Vinh Phuc Develops Industrial Parks as Economic Growth Driver

11:45:40 AM | 26/9/2019

In recent years, Vinh Phuc province’s economic development indicators showed that developing industrial zone infrastructure to attract investment funds to motivate economic growth and socioeconomic development is a key policy, an important driver of local economic growth. To learn about operations of industrial parks and local development results in recent years, Vietnam Business Forum has conducted an interview with Mr. Bui Minh Hong, Director of Vinh Phuc Industrial Parks Authority. Nguyet Tham reports.

Could you please briefly introduce the performance of industrial parks in Vinh Phuc province in recent years?

Situated in the northern key economic region, the gateway to Hanoi, the capital of Vietnam, near Noi Bai International Airport and functioning as a bridge to link Northwest provinces with Hanoi and the Red River Delta, Vinh Phuc province has favorable geographical, economic and political conditions to develop industrial park infrastructure and attract investors to motivate economic growth and development.

To date, Vinh Phuc has planned to build 18 industrial parks covering over 5,228 ha in total, including 11 operational facilities covering over 2,159.1 ha. The occupancy rate is over 65.1%. Many industrial parks report high occupancy rates such as Ba Thien Industrial Park in Phase 1 of 52 ha (100%), Binh Xuyen Industrial Park (92%) and Khai Quang Industrial Park (98%). Investors from 16 countries and territories have located 276 projects in Vinh Phuc province-based industrial parks, including 225 FDI projects with over US$3 billion of investment capital and 51 DDI projects with more than VND14,000 billion. Vinh Phuc is also a destination for many big firms such as Honda Vietnam, Toyota Vietnam, Piaggio, Sumitomo, Jahwa Vina, Prime Group, Vietnam-Germany Steel Pipe Joint Stock Company (VG Pipe), enabling the province to establish the manufacturing center of automobiles, motorcycles, high-tech industries, supporting industries, electronics and construction materials. Tenants in industrial parks account for over 50% of industrial output value, 50-65% of total export value, and 30-45% of fiscal revenue. They also employ thousands of workers.

In the eight months of 2019, the growth index of industrial parks continued to be impressive. Local industrial parks attracted 46 new FDI projects and allowed 32 existing projects to add their investment base with a combined registered capital of US$530.63 million (new grants: US$242.52 million, additional permits: US$288.1 million), 2.2 times that of the same period of 2018, equal to 190% of the full-year plan. They also drew eight new DDI projects and permitted five existing projects to invest in VND2,662.78 billion (new grants: VND2,585.8 billion, added permits: VND76.98 billion), 9 times that of a year ago and fulfilling 190% of the yearly plan. They disbursed a total of US$7.1 billion. They posted estimated revenue of US$19.13 billion, export value of US$ 17 billion, value of US$12.3 billion, and tax payment of VND4,370 billion. Tenants in local industrial parks hired nearly 112,000 workers. Well-performing investment projects have boosted economic growth, increased the share of service and trade in the local economic structure, while reducing the share of agriculture and forestry, and helped strengthen the balance of international trade payment.

Besides, accelerating urbanization has formed a closed link chain from supply, production to consumption. Industrial parks have modern synchronous technical infrastructure systems capable of effectively connecting with external social and economic infrastructure, especially to traffic routes linked to industrial parks in neighboring localities, and create spillover impacts on regional socioeconomic development investment.

So, what solutions will you take to increase the appeal of local industrial parks to investors?

We will focus on executing consistent solutions on development of industrial parks with modern and synchronous infrastructure capable of connecting and developing the region to give priority to large-scale investment projects using advanced, modern technologies to make value-added products and environmentally friendly products; speed up administrative reform, apply administrative procedures according to the single-window mechanism, and increase business exchanges and dialogues; consolidate the administrative apparatus in industrial parks to ensure sufficient authority and resources to run industrial parks and meet local development requirements.

The Vinh Phuc Industrial Parks Authority will give better advice on industrial park planning to 2030 in order to effectively exploit advantages of geographic location, infrastructure and population, support economic restructuring and labor restructuring, and speed up rural urbanization. We will accelerate communications to inform people of land policies and development plans to facilitate land compensation and site clearance; study and propose applying State land compensation policies to create land funds for building synchronous infrastructure in industrial parks; and strengthen inspection and supervision, and improve the quality of infrastructure construction of industrial parks. We will construct many modern, synchronous industrial parks with high competitiveness in the country and in the region. We will take care of material and spiritual life for laborers; propose mobilizing funds for building worker accommodation and utilities for industrial parks. We will work with relevant agencies to advise on vocational training for young people in rural areas, especially in rural areas where residents gave up their land for industrial parks, to build a skilled, well-qualified workforce.

By all the above solutions, we believe that local industrial parks will continue to reap new successes in the coming time, thus helping generate motivation for local economic development.”

Thank you very much!