Hai Phong Economic Zone Authority Boasts Sustainable Development in New Era

The process of building and developing industrial parks (IPs) and economic zones (EZs) in Hai Phong can be divided into two stages. The first phase, stretching from 1994 to 2006, saw three industrial zones established, including Nomura - Hai Phong, Dinh Vu (phase 1) and Do Son. During this period, the city’s attraction of investment capital was largely affected by the financial and monetary crisis and the Japanese economic recession. The second phase, from 2007 to date, features HEZA’s efforts to advise the city on adjusting and supplementing the Hai Phong Industrial Park Development Plan. In this stage, the Prime Minister approved adjustments and supplements to the industrial park development plan for the period until 2015 when 16 industrial parks with a total land area of approximately 10,000 ha will be built. Besides, the Prime Minister decided to establish Dinh Vu - Cat Hai Economic Zone on an area of 21,640 ha and seven industrial parks (bringing the total industrial parks in the city to 10). The global financial and economic crisis in 2008 posed numerous difficulties and caused adverse impacts on the attraction of investment capital and business operations of companies in the economic zone and industrial parks. However, investors there gradually overcame difficulties to boost production and business activities. Since being established, the economic zone and industrial zones have attracted more than 100 foreign direct investment (FDI) projects and more than 40 domestic direct investment (DDI) projects with an aggregate investment capital of approximately US$6 billion.

 

With regard to quality, most investment projects in the economic zone are important and large-scaled (in terms of capital investment, land area and industry) like ports, thermal power plants, DAP plants and urban - industrial - service zones (VSIP). Some projects in industrial zones have sizeable scales ranging from US$30 million to US$60 million, while the majority have a medium scale, with investment capital ranging from US$5 million to US$20 million. Domestic investors are mainly large and prestigious corporations like Vietnam National Chemical Group (Vinachem) and Petrolimex Gas Joint Stock Company. All projects are immediately carried out after investment licences are granted and they operate very well. Many projects have been scaled up in investment capital, production capacity and business lines. Currently, HEZA gives priority to large-scale projects using modern technologies, manufacturing high value-added products and having good reputation.

 

In 2010, companies in industrial parks got through difficulties to attain remarkable results. FDI enterprises grossed revenue of some US$1.2 billion, up 38 percent from a year earlier; exports reached US$740 million, up 48 percent; and contributions to the State Budget were US$45 million, up 35 percent. DDI enterprises raked in turnover of VND5,200 billion, up 21 percent year on year; and tax payments totalled VND350 billion, equal to 48 percent of the amount in 2009.

 

Cumulatively, companies in the economic zone and industrial parks earned US$2.8 billion from exports, spent US$3.3 billion on imports, paid more than US$122 million and VND2,650 billion to the State Budget, and created 30,000 jobs for Vietnamese and foreign workers.

 

The formation and development of the economic zone and industrial parks in Hai Phong City have played significant roles in increasing investment capital, expanding production capacity, applying advanced sciences and technologies, and expanding markets. These facilities have also laid the groundwork for promoting consistent development of technical and social infrastructure; stimulated the development of services and markets; created jobs and improved working skills for labourers, thus heightening living conditions of local people and solving social problems; impacted service- and industry-driven economic restructuring; and accelerated the process of industrialisation and modernisation. They have also functioned as a driving force to speed up socioeconomic development, promote the market economy, strengthen external relations and international integration, expand economic space, and propped up external economic activities. They are important factors to realise the target of turning Vietnam into a powerful sea-based country as stated in Resolution 09/NQ-TW of the 4th Meeting of the Party Central Committee, Tenure 10.

 

The first is the primacy of Hai Phong City-based economic zone and industrial parks compared to other areas. The city has a clean land fund, good basic infrastructure (electricity grid, water supply, sewage treatment, communications systems, etc.), attractive investment incentive mechanisms, and streamlined public administrative services.