DEEP C Industrial Zones: Success Story of FDI Attraction in Vietnam

11:16:21 AM | 10/10/2019

In the three decades since the approval of the first Law on Foreign Investment, the FDI sector has formed the backbone of Vietnam’s economy and made increasing contributions to national socio-economic development. More FDI projects are coming to the country, showing growing confidence among investors in market prospects.

At the heart of northern infrastructure development, DEEP C Industrial Zones are one well-established option for investors looking to venture into one of the most dynamic emerging economies. DEEP C itself is an FDI project success story in Vietnam. Starting out quite modestly in 1997 with one industrial zone of 500 hectares in Haiphong, also known as Dinh Vu Industrial Zone, the company is expanding aggressively to 5 industrial zones of approximately 3,400 hectares based in Haiphong and Quang Ninh, becoming one of Vietnam’s biggest industrial zone developers. The platform was initiated by the successful partnership between Belgian group Rent-A-Port and Haiphong People’s Committee, offering investors huge competitive advantages due to its direct proximity to Lach Huyen deep seaport, Cat Bi international airport, and a synchronous network of inland expressways linking to key surrounding regions.

DEEP C’s 20-year presence reflects the fruitful journey of Vietnam in FDI attraction. In addition to establishing best-in-class industrial complexes in the north, it has hosted 100 investment projects with a cumulative value of US$3.5 billion, including industry champions like Bridgestone, Chevron, Knauf, Flat, and others. Investors from multiple industries ranging from general industries, logistics, petrochemical to electronics and automotive are all welcomed, thanks to its flexible master plan. The case study of DEEP C is a firm example of how industrial zones are leveraging the appeal of Vietnam in terms of FDI inflows.

Nevertheless, its priority is not merely to cover land with factories. Over recent years, the group has made significant progress in moving up to technology-driven, high value-added, labor saving projects, meaning FDI attraction should be associated with sustainable development. This is also in line with the government’s direction and viewpoints towards FDI attraction.
Being on the radar of such targeted investors is not only the story of excellent connectivity and good infrastructure, but also requires a transformation into a new-generation industrial zone. In this context, industrial zone developers should have a keen eye on economic outlook as well as highlighted trends to cater to a broader audience in industrial markets.

Previously, manufacturers looking to set up operations in DEEP C would go for conventional option: long-term land lease. In recent years, a lot of them have chosen to enter the market by leasing ready-built-factory (RDF) or Built-To-Suit solution, a faster, safer and more cost-efficient option, before making a long-term commitment. As this trend continues to rise, DEEP C is speeding up to provide more high quality ready built workshop/warehouse space.

Further, aimed to become the pilot eco-industrial park where tenants can flourish without a heavy environmental burden, DEEP C is carrying out a series of initiatives. Its cross-industry partnership with US-backed Dow Chemicals to build Vietnam’s first road from recycled plastic in DEEP C is clearly one of them. The first 200-meter segment, to be completed this September, followed by another 1.2 kilometer within November, will divert about 4 metric tons of flexible packaging – the equivalent of roughly one million pieces of flexible wrappers. Plastic wastes are collected from different sources, of which a large part coming from DEEP C’s tenants. This project, coupled with the generation of renewable energy and more ideas lining up to be revealed, are establishing DEEP C as a symbol of innovation-driven industrial zones across the country.