Attracting Investment, Leveraging border-gate Economic Development

 

With the support of the Government, ministries and central agencies, Lao Cai province has actively and effectively carried out government policies, flexible guidance solutions, and introduced policies on economic zone development. The province has applied investment incentives and land-use rights auctions, encouraged cottage industry development, stimulated cross-border trading, and reformed administrative procedures. In addition, the province holds regular meetings and maintains contact with local companies to learn about their difficulties and obstacles arising in the process of investing and doing business in Lao Cai province, and promotes development in local industrial parks and border gates to foster socioeconomic development.

 

The province has significantly improved the investment, production and business environment; gradually completed the infrastructure system and ensured security and order in industrial zones and economic zones; and raised the provincial competitiveness index (PCI), which was ranked the Top 10 in the country. The improved investment, production and business environment is one of effective investment support conditions, thus drawing more investors to do business in the province and locate their projects in border gate economic zones and industrial parks. The province now has three industrial parks, one commercial - industrial zone, and six border gate economic zones.

 

As of mid-September 2016, Lao Cai province-based industrial zones drew 140 investment projects (an increase of 28 projects over 2010), with a total registered investment capital of VND21,000 billion (an increase of VND4,000 billion over 2010). The annual growth in industrial zones averaged 15-16 per cent in 2010 - 2015. The revenue in 2015 was 3.07 times as much as that in 2010 (VND6,600 billion in 2010); the industrial production value in 2015 was 11.7 times bigger than that in 2010 (VND378 billion in 2010); tax payment value in 2015 increased 4.6 times over 2010; the workforce included 7,344 workers in 2015, up 2.8 times against 2010; and per capita income was 1.5 times as much as that in 2010. To date, the average occupancy rate of industrial zones is over 80 per cent (the occupancy rate in Bac Duyen Hai Industrial Park is 99 per cent and the rate in Dong Pho Moi is 100 per cent). As much as over VND18,000 billion was disbursed, equal to 81 per cent of the total registered investment capital, and over 80 per cent of tenants operated effectively.

 

The border gate economy is a driving force of local socioeconomic development. In the past time, Lao Cai province has actively carried out flexible policies and guidance to draw more investors to invest in local border gate economic zones. The border gate economy has made important contributions to local socioeconomic development. Export and import revenues increase year after year. Key exports include ores, rice, sugar, rubber, fresh litchi, cassava and banana, while major imports are chemicals, fertilisers, ores, gypsum, ceramics, machinery, vegetables and fruits. Export and import value reached US$1.66 billion in 2011 and amounted over US$2 billion in 2014. The province now has over 600 companies engaged in cross-border export and import. Cross-border trade tax revenue valued nearly VND2,000 billion, accounting for a third of the local total budget revenue). Over 2 million people and over 150,000 automobiles cross the border gates each year.

 

In the coming time, Lao Cai province will have ample opportunities and advantages for development after key transport works like Noi Bai - Lao Cai Highway and upgraded Yen Vien - Lao Cai Railway are put into operation to serve transportation demands. Industrial parks, commercial - industrial zones and border gates have better infrastructure systems. The province expects to achieve an annual production growth of 20 per cent and a yearly export growth of 20 - 30 per cent and serve 2 - 3 million people cross its border gates a year. These facilities will increase the province’s budget revenue and create driving forces for developing industry, trade and services, thus helping restructure the economy, ensure national defence, create jobs for local people, and improve livelihoods for citizens. The province expects to achieve an annual production growth of 20 per cent and a yearly export growth of 20 - 30 per cent and serve 2 - 3 million people cross its border gates a year.

 

Therefore, Lao Cai province has directed relevant agencies to consider expanding and developing new industrial parks (from 1-2 heavy industrial parks covering 1,000 - 1,500 ha), enlarging border gate economic zones, building cross-border economic cooperation zones and opening border gates and routes to boost cross-border trade, as well as managed industrial parks according to the law.

 

To enhance the efficiency of FDI capital contributed to overall local development, address difficulties and limitations in attracting and managing FDI capital and facilitate FDI companies to do effective business, Lao Cai province has directed relevant agencies to review and publicise foreign investment attraction and management orientations, build the list of projects in need of investment capital in the 2015 - 2020 period, with a vision to 2030, and promptly resolve hardships facing investors, thus facilitating them to invest and expand operations in industrial parks.

 

Besides, it is necessary to mobilise and reasonably allocate resources, and focus investment on upgrading infrastructure, to create breakthroughs in improving the investment climate and supporting production and business activities. The province will particularly give priority to perfecting transport, power and water infrastructure systems as well as infrastructural facilities in industrial and economic zones; encourage enterprises to make active investments in manufacturing products with high degree of grey matter, modern technology towards sustainable development in industrial parks; and raise the quality of personnel training to meet the demands of local enterprises.

 

At the same time, Lao Cai will effectively carry out operation administration regulations at border gates issued together with the Prime Minister’s Decision 45/2013/QD-TTg; continue to study and propose mechanisms, policies and solutions on exit and entry, export and import to attract more to do export and import; enhance foreign affairs and exchanges with Chinese authorities to deal with emerging issues at border gates; and step up trade promotion and support export and import at border gates.

 

In light of the principle “Businesses thrive, Lao Cai develops”, Lao Cai province has provided the most favourable conditions for businesses to invest, do business and cooperate for the purpose of building Lao Cai into a prime example of socioeconomic development, a growth engine and a growth nucleus in the Northwest mountainous region and in the country.