“Businesses Thrive, Lao Cai Develops”

5:34:46 PM | 25/10/2011

That is the slogan that leaders of Lao Cai at all levels have defined and worked for over the past years. The province has created the most favourable conditions for local businesses to develop on hopes that “business development is the best way to ensure and improve social security.” To have a more complete picture of investment attraction in Lao Cai at present and in the future, Reporter Le Sang has an interview with Mr Dang Xuan Phong, Director of Department of Planning and Investment of Lao Cai province.
The mountainous border-sharing province of Lao Cai lies on the Kunming - Lao Cai - Hanoi - Hai Phong economic corridor. What are its advantages and disadvantages in attracting investment capital at present?
Lao Cai has huge advantages in agriculture, forestry and tourism. Its greatest advantage is the Lao Cai - Ha Khau international border gate – the main gate linking Vietnam and ASEAN with the vast western region of China. At present, the Lao Cai - Ha Khau international border gate is attracting more and more companies to do business.
However, Lao Cai now has some difficulties and limitations and it is striving to overcome them. The biggest problem facing Lao Cai today is infrastructure, particularly weak transport systems, and many investors shrug off the province because of this matter. In addition, the worker quality is too low to meet the demand of businesses.
Urgently seeking solutions to investment attraction problems, Lao Cai has taken up advantages and overcome weaknesses in recent years. Particularly, the province always creates most favourable conditions for domestic and foreign businesses to access China's vast market. It has also continuously improved infrastructure, electricity and water systems, while focusing on public administration reform.
In 2010, Lao Cai ranked second out of 63 provinces and cities across Vietnam on the provincial competitiveness index (PCI). Would you mind sharing the lessons Lao Cai has learned in attracting investment?
The PCI 2010 result brought great happiness for Lao Cai people as it recognised efforts of the province in attracting investment and developing the economy over the past years. However, this is a big challenge for Lao Cai province because keeping this ranking is a hard task in the future. Knowing this, we have quickly drawn valuable lessons in attracting investment as follows:
First, attracting investors with the business environment. Accordingly, all levels, branches, localities and civil servants are deeply aware that each business is a precious "pearl" to be kept for Lao Cai. Therefore, all officers and civil servants have to create the best conditions for those “pearls” to shine.
Second, attracting investment into strong local fields. The province is stepping up investment attraction for industry, commerce and tourism. It is calling investment capital for downstream processing of metals, where the province has advantages, like iron and copper and for processing of agricultural and forestry products. To boost trade, it is increasing investment for improving the quality of warehousing, logistics, commercial and hotel services. It will focus on upgrading services in Sa Pa and Bac Ha tourist sites and other attractions.
Third, attracting investment by mechanisms and policies. In addition to general preference policies applied to all investors provided by the central government, Lao Cai province offers investors additional preference mechanisms and policies on tax and administrative procedures.
Given the current economic slowdown, maintaining and promoting the investment environment is a tough challenge for many provinces and cities. So, what has the Department of Planning and Investment advised that the provincial authorities do to create a better, more transparent and more dynamic investment environment in the future?
In the coming years, particularly in 2012, the influence of the global economic crisis will continue to affect Vietnamese businesses. Credit flows have been tightened as a measure of fighting rising inflation. In this context, clearly aware of difficulties facing Lao Cai businesses, the Department of Planning and Investment has advised provincial authorities to focus on the following contents:
Stepping up investment and trade promotion activities to attract more companies to do business in Lao Cai, particularly into Kim Thanh commercial - industrial zone, which is granted exclusive mechanisms approved by the Prime Minister.
Advising provincial authorities to cooperate and coordinate with Yunnan province, China, to launch pilot and official operation of Customs Check Point 2 linking Kim Thanh commercial - industrial zone (Vietnam) with Beishan commercial - industrial zone (China).
Reviewing ongoing investment projects in the province, closely coordinating and cooperating with local authorities and the Lao Cai Business Association to catch up with new investment trends and needs, as well as understand difficulties facing the business community to advise provincial authorities to launch timely solutions. Then, the department will know more about expectations of investors in other localities and in other countries wanting to invest in Vietnam.