Lao Cai Offering Various Business Support Solutions

8:14:40 AM | 6/12/2016

By tapping the potential and advantages of a frontier province, the industry and trade sector of Lao Cai province has affirmed its leading and driving roles in local socioeconomic development. The Vietnam Business Forum has an interview with Mr Do Truong Giang, Director of Lao Cai Department of Industry and Trade. Duy Binh reports.
Could you please introduce the achievement of industrial and commercial development criteria of Lao Cai province in the 2010-2015 period?
As the backbone of the local economy, the industry and trade sector of Lao Cai province has promoted its strengths. To date, the operation of many large industrial projects engaged in mining, chemical, fertiliser, metallurgy and hydropower has given a strong boost on economic development. Industrial zones have been expanded with good infrastructure to house new tenants and projects. Commercial activity has thriven.
Industrial production has become a breakthrough stage in local socioeconomic development, making Lao Cai a centre of metallurgical and chemical industry of the region and the country. The operation of many downstream mineral processing projects like Viet Trung iron and steel mill, DAP fertiliser production plant and Duc Giang chemical complex has sped up industrial development and quickened industrial production restructuring with the aim of raising the share of processing industry and creating high valued-added production. Besides, the potential of hydropower industry is rationally tapped. The province now has 37 operational hydroelectric projects with a total capacity of 604.9 MW. The national grid has reached all communes, 92 per cent of the villages and 93 per cent households. The value of industrial production (based on the base price in 2010) was estimated at VND18,959 billion in the first 11 months of 2016, or 98.9 per cent of the full-year plan and up 15.3 per cent year on year. Of the sum, the mining industry was forecast to generate VND1,918.7 billion, equal to 64.3 per cent of the yearly plan and up 12.7 per cent year on year. Handicraft development policy has effectively applied to facilitate production development.
Commercially, sustainable domestic trade development meet consumer demands while export and import are defined growth engines of the provincial economy.
Domestic trade is very active. Well-circulated goods basically meet consumer demands, even in remote areas. Currently, some distributors always have effective distribution and sale plans, particularly for high-demand Lunar New Year. Commodity prices are kept relatively stable. The total value of retail sales and services was estimated at VND1,528.3 billion in November, up 0.9 per cent from the previous month and totalled VND14,916.3 billion in the first 11 months, fulfilling 88.8 per cent of the full-year plan and rising 7.3 per cent from a year earlier.
Cross-border trade is also stable. Import for re-export is very active. Export and import value was US$217.9 million in November and US$1,671.1 million in the first 11 months, completing 66.8 per cent of the yearly plan but down 16.4 per cent from a year earlier. Key exports include rice, sugar, rubber, phosphorus and footwear while main imports are power, ferrous alloy, fertiliser, coke, iron, steel and equipment.
Trade promotion is accelerated. The province has actively organised market surveys and attended international trade fairs in foreign countries. It has cooperated with Yunnan Province (China) to rotationally organise Vietnam-China Border Fair and actively responded to “Buy Vietnamese goods” campaign.
Market management is also a major concern as the province has actively sought measures to control inflation, stabilise the market, create a competitive environment, and facilitate production and trading operation to ensure the sufficient supply of essential commodities to meet consumer demands.
In 2016, the industry and trade sector of Lao Cai province has hosted many trade fairs and exhibitions. How do you think of their impacts?
The Lao Cai Department of Industry and Trade has approved the organisation of 20 trade fairs in the province. These events attracted 1,150 exhibitors, 1,400 booths and more than 100,000 visitors. Specially, the Vietnam - China International Trade Fair, rotationally opened in Lao Cai and China, drew a lot of exhibitors and visitors. As many as 15 agreements and a memorandum of understanding, worth US$325 million in combination, were signed in this event. Particularly, the export contract was valued US$222.5 million, an import deal was worth US$98.5 million, and a transportation agreement was worth US$4 million. By industry, seafood sector captured US$175 million, fertiliser sector earned US$63.5 million, coke sector garnered US$15 million, and rubber sector took US$20 million.
Trade fairs and exhibitions displayed typical products of Lao Cai province to domestic and foreign companies, helped consumers understand the capacity of Vietnamese companies and the quality of Vietnamese products and services, and enhance the competitiveness of local products, particularly agricultural products and handicraft products. The province has supported companies to carry out investment plans and business expansion plans to encourage them to do long-term business in the locality and produce products to meet local demands from urban to remote areas. The province has also advised, encouraged and facilitated local businesses to carry out trade promotion events, stimulate consumption, speed up circulation of products, and boost local socioeconomic development.
To assist local companies to tackle emerging difficulties, what solutions and measures has the Department of Industry and Trade recommended to the provincial authority?
Slow-recovering prices of copper, iron and steel market, instable DAP fertiliser production and high prices of inputs hurt some of local key industries. In export and import, as China frequently intensifies cross-border trading, cross-border trade has substantially reduced.
To support local enterprises to deal with emerging difficulties, the Department of Industry and Trade has advised the Provincial People’s Committee on some major measures as follows:
Assign employees to keep track of local enterprises in order to help them address emerging problems when they need; advise the Provincial People’s Committee to host regular meetings with local enterprises to understand their issues.
Propose infrastructure investment in industrial zones and economic zones to create rentable spaces for enterprises. Particularly, the department has consulted the Provincial People’s Committee to build two projects which have been approved by the Government: (1) Adding Western Lao Cai Industrial Park into the list of Vietnam centralised industrial zones; and (2) expand the Lao Cai Border Gate Economic Zone.
Advise the provincial government to deal with requests from enterprises, such as fee reduction, tax break, iron ore export permit, apatite stockpile, protection of steel and fertiliser production, and VAT-zero tax application to fertilisers.
In export and import, the department has proposed piloting the opening of an export point in Lung Po, Bat Xa district, extending the time of seafood export to 10:00 pm at the international border gate, reducing export and import fees, simplifying the certification of origin, and issuing the list of merchants allowed to perform trade via auxiliary border gates and border crossings.
Effectively carrying out industrial promotion policies to support enterprises to purchase machinery and equipment, upgrade technology, train personnel, build brands and boost production and business operations. In 2016, the department will spend VND4 billion on 29 business supports for local enterprises.
The department will speed up trade promotion and support local businesses to seek markets; actively deploy the “Buy Vietnamese goods” programme (encouraging Vietnamese consumers to give priority to Vietnamese products on their shopping lists) to help enterprises to expand and occupy the domestic market. The department has organised trade promotion programmes and market surveys in Vietnam and China, advised local enterprises to grasp information on market demands and consumption, organise exporter and importer meetings, and maintain showrooms and exhibitions for local products.