5:44:08 PM | 12/9/2006
Da Nang is the biggest urban centre and a driving force for the development of Central Vietnam. The city has a convenient geographic location as a point of national highways, trans-Vietnam railway route, the waterway and air route. It is a gate to the Central Highlands and the final point of the East-west corridor transportation route via countries in the Mekong greater subregion.
This is one of the leading localities in Vietnam in terms of social development norms. The 2002 Vietnam Human Resources Development Report shows that Da Nang is just behind Hanoi and Ho Chi Minh City in human development index. In 2005 and 2006, the city has been second in terms of provincial competitiveness index. Da Nang is a national city with a GDP growth rate of 13 per cent for the 2001-2005 period, 1.6 folds higher than the average figure of the whole country. It is a leading locality in Central Vietnam in foreign direct investment (FDI) attraction. The foreign-invested sector has made a significant contribution to the city’s economic growth quality.
FDI inflow has risen in both quality and quantity. The number of new projects has increased sharply year-on-year, 39.59 per cent per annum, just higher than the average figure of 33.7 per cent of the whole country. So far, Da Nang has attracted 86 FDI projects with a total investment capital of US$665.72 million. The city has been rated as one of the five provinces and cities to have attracted most FDI projects in Vietnam. The shift has contributed significantly to a change in economic space and structure of Da Nang city.
Industrial production value of the foreign-invested sector accounts for between 20 and 25 per cent of the city’s total industrial production value. FDI projects have helped renew technology, especially in exported goods manufacturing, to create higher added value and more jobs with products of high competitiveness. The sector has generated jobs for 19 per cent of annually recruited workers and thousands of workers in support industries.
FDI enterprises’ export turnover has seen a high year-on-year increase, accounting for between 27 and 30 per cent of the city’s total export value. FDI enterprises’ main exports include children’s toys, electric products, garments, footwear, beer and wood chips.
The sector’s budget contribution has increased sharply, accounting for between 10 and 12 per cent of the city’s total budget revenues. Its average growth rate is 18 per cent per year. Its budget revenues are put at US$18 million per year. This figure is just high in Central Vietnam and Vietnam as a whole.
FDI in Da Nang has been diversified with a multi-lateralisation of economic relations, acting as a bridge between the city with over 90 countries and territories in the world.
Services have great potential in Da Nang. The foreign-invested sector accounts for a high proportion with over 145 branches and representative offices in various fields, including trade, insurance, finance and banking, consultancy, and more importantly, strategic projects, including Daewon, P&I and Riverside Tower, which will connect with famous landscapes including the China beach, the Ba Na mountain and the Ngu Hanh Son range, helping the service sector account for 46.16 per cent of the city’s economic structure and gain an average growth rate of 12 per cent in the 2001-2005 period and 27 per cent in 2005 alone.
After ten years’ renovation and dynamism, the city has made firm steps in ‘hard’ infrastructure development and has made changes in ‘soft’ infrastructure development for Vietnamese and foreign investors. Da Nang will continue to expand more opportunities for investors of the private sector to get equal access to resources to the State-owned and foreign-invested sectors.
Quoc Tuan
Vietnamese
