Da Nang Hi-Tech Park and IZs Authority Joining Forces to Become Silicon Valley of Southeast Asia

Despite being adversely affected by COVID-19 pandemic, Da Nang Hi-Tech Park and Industrial Zones have still achieved a very good result of investment attraction and made Da Nang City one of the most attractive investment destinations in the Central Coast and the Central Highlands. This achievement comes from outstanding efforts of the municipal government and the Da Nang Hi-Tech Park and Industrial Zones Authority to support investors and enterprises operating in Da Nang Hi-Tech Park and Industrial Zones. The following interview with Mr. Pham Truong Son, Director of the Da Nang Hi-Tech Park and Industrial Zones Authority, will provide more insight into Da Nang Hi-Tech Park and Industrial Zones. Thanh Tung reports.

Could you please introduce the investment picture of Da Nang Hi-Tech Park and Industrial Zones and its investment attraction prospects?

In the first six months of 2021, Da Nang Hi-Tech Park attracted 24 projects, including 12 domestic projects with a registered investment fund of VND6,291 billion (US$270 million) and 12 FDI projects with US$545.1 million. In total, Da Nang Hi-Tech Park and Industrial Zones attracted 499 projects with VND26,696 billion (US$1.1 billion) and US$1.74 billion. Large investment projects included the US$110 million semiconductor materials manufacturing plant of the United States Enterprise (United States) and the US$35 million Fujikin Da Nang Research, Development and Production Center of Fujikin International Co., Ltd (Japan).

Given that the COVID-19 pandemic is developing very complicatedly in Vietnam and in the world, the continued entry of many FDI hi-tech and information technology projects into Da Nang Hi-Tech Park and Industrial Zones is a good signal, showing the trust of investors in Da Nang City as a destination for their projects. Once in operation, investment projects in Da Nang Hi-Tech Park will produce positive changes in attracting hi-tech investment projects into Da Nang City, make important contributions to local socio-economic development, and nurturing the future development of science - technology. By investing in hi-tech and information technology infrastructure and enticing many large technology corporations, Da Nang City is working toward being a "Silicon Valley" of Southeast Asia.

In order to realize its goals and boost industrial development where Da Nang Hi-Tech Park is the core, the Da Nang People’s Committee issued Decision 2649/QD-UBND dated July 24, 2020 approving amendments to the Industrial Zones Development Planning Project to 2020, with a vision to 2025. The city aims to attract at least three projects of over US$100 million in 2020-2025 to increase the share of Da Nang Hi-Tech Park to the city’s GRDP to at least 10% by 2025. By 2030, Da Nang Hi-Tech Park will develop on par with Hoa Lac Hi-Tech Park and Saigon Hi-Tech Park to become the nucleus of socio-economic development of the Central Coast and the Central Highlands.

The city will carry out many solutions like drastically reviewing and using the land fund for inefficient investment projects inside and outside Da Nang Hi-Tech Park and Industrial Zones; clearing obstacles and ensuring the schedule of hi-tech projects; speeding up procedures for establishment and infrastructure completion in second-phase Hoa Cam, Hoa Nhon and Hoa Ninh industrial parks. At the same time, the city will complete and operate the infrastructure in Hoa Khanh Nam, Cam Le, Hoa Nhon and Hoa Hiep Bac industrial complexes; build affordable accommodations and socio-cultural institutions to support workers in industrial zones. The city will also develop logistics infrastructure of national and international class; drastically reform administrative procedures; scale up self-training models of industrial parks that cooperate with vocational schools to serve tenants; and accelerate scientific and technological application and innovation.

The reason why many investors have chosen Da Nang Hi-Tech Park and Industrial Zones as their destinations partly comes from the accelerated administrative reform, the enabling investment climate and the friendly and responsible leadership of Da Nang City and Da Nang Hi-Tech Park and Industrial Zones Authority.  Would you tell us more about this effort?

To attract investors, in addition to incentives for projects in Da Nang Hi-Tech Park as per Decree 04/2018/ND-CP of the Government dated January 4, 2018, Da Nang City in general and Da Nang Hi-Tech Park and Industrial Zones Authority in particular always provide an open and transparent investment environment; promptly respond to the feedback and recommendations of domestic and foreign investors and other organizations; support and facilitate enterprises to research and expand investment in Da Nang.

To create an open investment environment, Da Nang Hi-Tech Park and Industrial Zones Authority gives top priorities to reform of administrative procedures. In 2019, the authority advised the Municipal People's Committee to issue two decisions on new administrative procedures and revised and improved administrative procedures within the jurisdiction of the former. It publicly posted regulations on documents, procedures, timeline, fees and charges concerning administrative procedures on the information board at the public relations division, on the website of the city government and on the website of the authority. All administrative procedures are handled under the single-window mechanism with detailed instructions. All processes, procedures and service times are publicly listed on the information board and on the website.

On e-government construction, the Da Nang Hi-Tech Park and Industrial Zones Authority has coordinated with the Department of Information and Communications to upgrade all 42 procedures within its jurisdiction to Level 4 (except for seven procedures classified to be in the labor category undertaken under the system of the Ministry of Labor, Invalids and Social Affairs at Level 3). The authority has launched a plan to manage administrative procedures and continuously review regulations and administrative procedures. Accordingly, the settlement time of 17 administrative procedures has been reduced, with 10 related to investment. Specifically, the granting of new investment registration certificates in an industrial zone is reduced from 25 working days to 22. Seven labor administrative procedures are raised from Level 2 to Level 3. Two procedures are abolished (granting temporary residence permit and extending temporary residence permit for foreign workers in industrial zones).

To build a favorable, friendly and responsible environment, the authority has applied many forms of handling feedback and recommendations from tenants (through the website, writing documents or monthly meetings). In addition, every year, the authority organizes a business meeting to receive and solve complaints and recommendations from enterprises, promptly remove emerging difficulties and facilitate business development to contribute to local socio-economic development.

What industries are expected to create a strong boost to the development of Da Nang City in general and Da Nang Hi-Tech Park and Industrial Zones in particular in the near future?

Da Nang City has great potential for developing supporting industries, especially manufacturing materials, components and semiconductors. The fact that many foreign companies set up their manufacturing and assembly factories in Vietnam proves their expectations for the city to enter the global supply chain and value chain. And, to develop supporting industries, it is necessary to smoothly coordinate central and local efforts in formulating, promulgating and implementing preferential policies to develop supporting industries.

First, the Government of Vietnam needs to create a complete and favorable legal framework for the industry and attract businesses in supporting industries. It needs to apply technical standards, industry registration regulations, customs incentives and tax policies. It must consider making decrees and circulars on mechanical and electronic development. On that basis, the city will develop programs and projects to offer specific measures for implementation, with specific systems and processes such as technical development, human resource training, and financial support.

Second, the Government should have incentives of finance, land, infrastructure and human resources to participate in supporting industries, issue encouragement policies on the establishment of supporting industries, build funds for supporting industries, form lead bodies to strengthen State management of supporting industries.

Third, universities and research institutes need to focus on market-demanded training programs, and train skilled engineers capable of making inputs or conducting technological research for the development of supporting industries to meet market demands.

Fourth, it is necessary to pay attention to developing the distribution system to build a strong domestic market. The distribution system can easily and fully meet the market demand of enterprises for components, thus helping promote the development of supporting industries.

On February 4, 2021, the Prime Minister issued Official Letter 158/TTg-CN to ratify the proposal of the Ministry of Planning and Investment on revisions and supplements to add the Da Nang Industrial Zone Development Plan to the Vietnam Industrial Zone Development Plan to 2025. Accordingly, a 58.5-ha Supporting Industrial Zone of Da Nang Hi-Tech Park (Hoa Lien commune, Hoa Vang district) will be added to the Vietnam Industrial Zone Development Plan to 2025. The area, adjacent to the industrial park and Da Nang Hi-Tech Park, Da Nang IT Park and Hoa Ninh Industrial Park, will become a driving force for socio-economic development in the northwest of Da Nang City. Moreover, the addition and formation of the supporting industrial zone of Da Nang Hi-Tech Park will create a driving force to attract and promote the development of the city's supporting industries as advocated by the Standing Board of the Da Nang Party Committee in Resolution 01-NQ/TU dated October 30, 2020 on the development of supporting industries in Da Nang City to 2030, with a vision to 2045, and at the same time, entice supporting projects for Da Nang Hi-Tech Park and Da Nang IT Park.

Source: Vietnam Business Forum