Industrial and Export Processing Zones Should Unite in Investment Attraction

Vu Van Nam, Director of Managing Unit of HCMC industrial and export processing zones, said zones in the HCMC area are running out of “clean land”. Investors have rushed into HCMC and over-burdened the available land. A lot of investors require hundreds of hectares, but the zones in HCMC are already operating at full capacity with nearly 100 per cent of zones filled with companies. Many investors end up leaving unsatisfied.

The same situation is occurring not only in HCMC but also in the surrounding provinces of Ba Ria – Vung Tau, Binh Duong and Dong Nai. Some provinces have placed restriction on low-ICOR projects, and resolutely refused industries proposing labour intensive projects like garment and leather-footwear. Nguyen Manh Van, Vice Director of Managing Unit of Dong Nai industrial zones, said: “Dong Nai has no longer accepted small invested and labour intensive projects, first in Bien Hoa, as recurring labour disputes have broken out that functional institutions are unable to control.”

Meanwhile, only two industrial zones are operating on the acreage of 40 hectares in Tay Ninh. Although the province has offered favourable conditions and general priorities, the number of projects in industrial zones remains modest.

Le Van Hoc, Director of Department of Local Economy and Territory (Ministry of Planning and Investment), admitted that investment attraction in most provinces in the Mekong Delta were also facing difficulties. This region has 111 industrial zones and complexes covering 24,000 hectares, yet less than half of the area is hired in many zones. Therefore, sustainable development can only be attained by the zones working together, each specializing in its strong points. For instance, HCMC should give priorities to the banking and finance sector, high-tech-intensive and labour-saving industries. Ba Ria – Vung Tau should focus on industries demanding harbour access. Provinces endowed with abundant labour like Tien Giang and Long An should propose policies to preserve human resources and appeal to industries based on this privilege and the advantage of large industrial land area. Provinces like Tay Ninh and Binh Phuoc have become a destination for businesses in the agricultural and forestry processing industry. Simultaneously, local governments should recheck projects in industrial zones and terminate inactive and land-occupying projects to help develop efficient projects operated by true investors.

As planned, the Government has approved the development of 100 more industrial and export processing zones, and increased the quantity of industrial land to over 40,000 hectares by 2010. By 2020, the area of industrial land will rise to 70,000-80,000 hectares. In addition, the Government also approved the industrial development direction of the Southern key economic region, to gradually shift from focusing on quantity to quality, with high technology and techniques. Regarding the planned allocation of industrial and export processing zones, new zones will be limited in HCMC, Vung Tau and Bien Hoa city (Dong Nai province). Accordingly, industrial zones will be strongly encouraged to develop in Tay Ninh, Binh Phuoc and Dong Nai.