Dong Nai Province's Industry Ready for International Integration

When mentioning Dong Nai’s industry after the liberation of the south, people often remember the Bien Hoa technological zone, or the Bien Hoa I industrial park today, which depended much on imported materials and spare parts. After 1975, the Bien Hoa I industrial park had only 33 plants operating perfunctorily and 12 plants having to close and 3,000 unemployed workers.

 

In the late 1970s, it was a difficult task to resume production activities of plants as the fierce war had just ended in Vietnam. Many emulation movements, launched to develop ideas and initiatives for overcoming difficulties due to shortage of materials, and spare parts, helped resume production of tens of plants in the Bien Hoa I industrial park. Also, tens of industrial and handicraft co-operatives and complexes were formed. However, due to the negative impact of the centrally-planned economy, many State-owned plants gained poor production effectiveness. The average growth rate of the 1981-1985 period reached around 8.5 per cent per annum.

 

The most important milestone for Dong Nai’s industry was seen in the 1986-1990, the beginning period of the renovation process. Many local plants found their development orientations under the market mechanism. However, due to the fact that the centrally-planned mechanism was not completely removed, the industrial sector did not see a strong development. Until 1990, industrial production value increased by 1.35 fold against that of 1985 and the contribution of the sector to the province’s GDP reached 20 per cent.

 

In the 1991-1995 period, Dong Nai’s industry with the State’s encouragement of the development of all economic sector, especially foreign investment attraction, witnessed a rapid development. The average growth rate of the industrial sector reached 37.2 per cent per annum. In 1995, the province’s industrial production value was put at VND 7,139 billion, up by 4.8 fold against 1990 and the sector contributed around 40 per cent to the province’s GDP.

 

In the last decade, from 1996 to 2005, Dong Nai’s industry overcame the negative effects of the Asian monetary and financial crisis to accelerate its development. In particular, the foreign-invested sector became one of the driving forces for industrial development. The average growth rate of the period reached around 19.4 per cent.

 

Thirty years have gone by, marking a long development period of Dong Nai’s industry with the formation of industrial parks. By 2005, when the province’s industrial sector increased by 320 folds against 1976, Dong Nai had become the third largest industrial centres in Vietnam, generating jobs for around 300,000 people. As a result, from an agricultural province, Dong Nai has turned into an industrial province with industry accounting for 57 per cent of its GDP. The export of industrial products has gained a high growth rate with an average turnover of over US$3 billion per annum, accounting for around 10 per cent of the whole country’s total turnover. Apart from Bien Hoa city, industrial production has developed in many poor rural areas such as Nhon Trach, Long Thanh, Vinh Cuu and Trang Bom, making a contribution to improving the living standard for the people in the localities.

 

Despite its outstanding development, Dong Nai’s industry has exposed many shortcomings. For example, the province’s industrial sector has developed widely but not in depth. Many plants, implementing subcontracts, still use many workers, leading to low industrial added value. These enterprises have yet to attract hi-tech and source technologies, and they have not made breakthrough in investment yet. In addition, the competitiveness of local industrial enterprises remains poor.

 

As planned, the industrial sector in Dong Nai province in the 2006-2010 period will see its production value increasing by 16 per cent per year. In the coming years, the industrial sector of Dong Nai province will encourage and prioritise projects on manufacturing spearhead products, hi-tech, and products of high intellectual condense and high added value, such as machines, electronic and electric equipment, new materials. Also, the province will call for investors to invest in support industries. The province will increase the effectiveness of investment in industrial parks, providing support for the farm-produce and food processing industries and developing traditional crafts, improving the competitiveness of local enterprises, as well as reducing the contribution of those labour-intensive industries, such as footwear and textiles and garments.