Not only advancing trade, import and export, the Trans-Pacific Partnership (TPP) Agreement is expected to open up opportunities to start a major wave of foreign direct investment (FDI) flowing into Vietnam, particularly investment from the United States. This will be a driving force to create positive change both in value and quantity of FDI capital in Vietnam in the coming time. Vietnam Business Forum interviewed Mr Nguyen Van Dat, General Director of Vietnam Urban and Industrial Zone Development Investment Corporation (IDICO), on this issue. Van Luong reports.
IDICO is reportedly an investor of many large industrial zones in Dong Nai, Ba Ria - Vung Tau and other provinces. It is known that foreign investors are very interested in the firm’s industrial parks. Could you please briefly introduce the corporation’s industrial zones?
In the past years, IDICO has continuously developed major projects of national scale. Particularly, in industrial zone infrastructure development, IDICO has invested to build, manage and operate 17 industrial parks nationwide with a combined area of about 10,000 ha and a total investment capital of VND10 trillion. These projects have sufficient utility services and synchronous infrastructure. As they are located in industrial areas, their occupancy rate is quite fast. For example, Kim Hoa Industrial Park (first phase) and Nhon Trach V Industrial Park are fully occupied; Nhon Trach I Industrial Park has rented over 90 percent of rentable area; and My Xuan A Industrial Park leased over 85 percent. These industrial parks have attracted many big foreign projects, particularly from South Korea and Japan. Typical investors are HOYSUNG Group of South Korea (US$1.615 billion), POSCO Group of South Korea (US$1.128 billion), POSCO Steel Corporation (US$620.425 million) and Nippon Sheet Glass Company of Japan (US$182.8 million). These projects have largely contributed to increasing the State Budget, accelerating economic restructuring and creating jobs for local workers.
Along National Road 51 from Dong Nai province to Ba Ria - Vung Tau province, IDICO has built many industrial parks, including Nhon Trach I, Nhon Trach V, My Xuan A, My Xuan B1, Phu My II, and expanded Phu My II, with a total area of 3,000 ha. This is typically an environment-friendly industrial park system that draws deep interests of domestic and foreign investors.
Noticeably, industrial parks invested and developed by IDICO are located in strategic positions and designed according to international standards. Is this one of key factors that creates the value of IDICO brand?
IDICO, affiliated to the Ministry of Construction, was established under Decision No. 26/2000/QD-BXD dated December 6, 2000 by the Prime Minister from merger of construction companies in the region. As a late-coming company of the Ministry of Construction, since its inception, IDICO defined to focus on investing and developing industrial parks in addition to existing business operations.
Industrial zones invested by IDICO like Nhon Trach I, Nhon Trach V, My Xuan A, My Xuan B1 and Phu My II were based on poor regions in the 2000s. With the support and assistance of authorities from the central to local levels, and the ongoing effort of all the staff, IDICO-invested industrial parks have importantly contributed to local economic development.
To achieve these successes, IDICO thoroughly studied and weighed all factors that affected investment project most like transport system before it made investment decisions. When it invests and operates infrastructure systems of industrial parks IDICO always focuses on perfecting the quality and utility and satisfying legitimate needs of tenants. In spite of numerous existing difficulties and obstacles in procedures, IDICO has invested to build houses to meet accommodation demands from workers in industrial zones and low-income people. Then, the prestigious, brand and position of IDICO have been gradually enhanced.
What do you think about the wave of foreign direct investment in the coming time, when the country is changing and restructuring rapidly as now?
Currently, Vietnam is stepping up its economic restructuring and gradually perfecting its market economy to better integrate into the world economy. The Party and State of Vietnam are carrying out consistent reform policies on national administration, including institutional reform, bureaucracy and administrative procedures, in order to create a favourable legal framework and environment for local residents as well as foreign investors investing in Vietnam.
In the coming time, the FDI flow is forecast to change significantly. This is a favourable but challenging factor for development and investment process. To get prepared for catching a new investment wave, IDICO will continue to seek for building new modern industrial parks to meet rising demands of investors, with focus given to environmental protection and sustainable development. On planning, IDICO recommends relocating production companies into industrial zones and building houses for workers. Besides, IDICO is also eager to receive supports from authorities for accommodating policies and from investors to build modern industrial parks with synchronous infrastructure, well-connected transport systems, and friendly environments.
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