Ha Tay Province Making Disadvantages Advantageous

 

At a meeting with enterprises in Ha Tay Province on August 5, Mr. Nguyen Tran Nam, deputy general director of Viglacera, complained that his corporation wanted to move a factory into Ha Tay province but encountered numerous difficulties. The Viglacera floor tile factory was asked to move to another location because it is situated too near to the new National Convention Centre in the west of Hanoi. The Viglacera Board of Directors wanted to move to a favourable location along the Lang-Hoa Lac Expressway and near its existing factory.

 

Early in June 2005, the Board of Directors and leaders of Ha Tay province made a survey and agreed on building the new Viglacera factory in a 6-ha square in Quoc Oai District along the expressway. Both sides were very happy because Ha Tay province will have hundreds of locals employed and will receive considerable taxes each from the new factory costing dozen million of US dollars while Viglacera didn’t lose too much time and money finding a new location. Viglacera tried its best to complete the construction design for the factory to submit to Ha Tay province for approval by late July. However, the government of Ha Tay province ordered Viglacera to find another location because the selected one was unfeasible for some reasons. Mr. Nam said that Viglacera spent two months on this project and felt disappointed by the result.

 

This story may be an exception but Ha Tay province is well-known for land-use rights disputes and conflicts between locals and investors in several industrial parks. The wrongdoing from the Ha Tay side has worsened the business environment image here. In May, VCCI polled small and medium-sized enterprises about business environments in 42 provinces and cities nationwide. The questionnaire sample had 9 criteria, including business licence duration, land rental approach, information transparency, investigation duration, unofficial payments, policy execution, incentives for State-owned enterprises, law observance by local authorities and support for private enterprises. Ha Tay province came last in the survey.

 

Mr. Vu Huy Hoang, chairman of the People’s Committee, said in an interview with a reporter of Vietnam Business Forum Magazine (VIB) that Ha Tay leaders were surprised at the result but weren’t shocked. Hoang explained that Ha Tay leaders weren’t surprised because the non-cooperation of locals near industrial parks with investors were regularly broadcast on TV and had certain impacts on the result of the survey. Hoang also confessed that local authorities had previously raised difficulties for investors. However, Ha Tay leaders were also surprised because the province has attracted much more investment than many localities in the country.

 

Nonetheless, Hoang said, the VCCI’s result will add momentum for the provincial and local authorities to improve the business environment. In July and August, the province organised numerous meetings with communes, districts and branches to urge them to create a better business environment. Leaders of all administration levels must report on their wrongdoings and propose solutions to overcome them. The province also introduced a series of documents to apply the one-door administrative policy to save time and money for investors. Provincial leaders will meet enterprises weekly to resolve existing shortcomings.

 

However, the biggest difficulty facing Ha Tay province is site clearance and land compensation. The authorities must explain clearly to locals about land-use rights and compensations. Locals used to blockade factories to ask for a rise in compensation, such as in the An Khanh Industrial Park in Chuong My and ask for retroactive effects of old policies. This has become a domino effect, which resulted from the unfinished resolutions of local governments. This surely has had negative impacts on the investment decision of investors when considering investing here.

 

Mr. Ha Van Hien, Ha Tay Provincial Party Committee Secretary, confirmed at the meeting with investors that Ha Tay province is determined to improve the business environment. The new leadership has a strong consent to measures to provide a better business atmosphere. The close cooperation amongst parties, departments, branches, the Fatherland Front and neighbours associations has been further strengthened. Conferences and meetings have been regularly organised, especially where there are land conflicts and a lot of red tape. A lot of policies have been replaced to have a better administrative apparatus.

 

The Viglacera case may not be resolved immediately because of numerous difficulties originating from its location too close to the expressway and the effects of many old regulations. But, the situation must be much better as Mr. Hien promised the deputy general director of Viglacera. Furthermore, with its recent efforts, the rank of Ha Tay will surely level up next year. Right now, many investors are showing great interest in investing in Ha Tay province. Ha Tay hopes that domestic and foreign investment flows will soon return into the province.