Ba Ria - Vung Tau Province Perfecting Infrastructure in Industrial Parks

Along with planning and building industrial parks, tourism areas and sea ports, the People’s Committee in the southern province of Ba Ria-Vung Tau has been paying attention to the developing of infrastructure in industrial parks.

Compared to industrial parks in other provinces, industrial parks in Ba Ria-Vung Tau province have many advantages to draw investors. They are located near big industrial centres in Ho Chi Minh City (about 100 kilometres); as well as have convenient road and waterway transport system, including 10-kilometre Thi Vai River and a great number of ports along rivers capable of receiving cargo ships with capacity of up to 60,000 tonnes each. Energy sources supplied for production activities in the parks are rather abundant, mainly are thermal power from Phu My I, Phu My II, Ba Ria plants that are under operation in the province and from Phu My III and Wartshila plants with a combined capacity of thousands of MW that will be put into operation in the province; as well as gas associate sourced from Bach Ho oilfield transported through a pipeline with capacity of 1.5 billion cubic metres a year, or will be transported via underway Nam Con Son pipeline with capacity of three cubic metres a year for the first phase and seven cubic metres a year once fully operational. Service network to serve the provincial industrial development is synchronous. Local human resource has been improved to meet labour demand of many production sectors. 

 

In order to uphold the advantages to draw investment in the industrial parks in the province, the locality has been implementing well incentive policies issued by the state and the local authorities. It has also developed a training system to ensure high-quality human resources for the industrial parks; bettered infrastructure so as to lower land rent to between US$0.8 and US$1 per square metre per year from the current US$1.5 per square meter per year; as well as simplified administrative procedures on investment license in the parks.

 

The province has to date licensed 41 industrial park projects with a combined investment of VND355,507 billion. However, in order for over VND350,000 billion to bring economic effect to the province, it needs to pour at least VND10,980 billion into infrastructure projects. Of the total, the province has to inject VND2,300 billion to develop infrastructure for seaport projects, VND2,650 billion for infrastructure projects besides the industrial parks, VND1,920 billion for infrastructure for projects in Go Gang and Long Son, VND1,220 billion for power supply projects for Cai Mep-Thi Vai and Sao Mai-Ben Dinh seaport complexes and tourism projects in Chi Minh Cua Lap and coastal areas. The province, moreover, has to spend VND2,880 billion on site clearance for the projects.

If Ba Ria-Vung Tau province does not develop infrastructure works surounding the industrial parks, the province will meet difficulties in approaching the capital booked by investors, said Le Minh Chau, Head of industrial parks authorities in the province. Therefore, the provincial People’s Committee is taking drastic measures to develop infrastructure surrounding the industrial parks. Capital is the biggest problem for the province as the provincial budget does not meet the investment demand of the projects. The first practical policy that the province has ever carried out is encouraging and calling on investors to advance land rent to build infrastructure works besides their industrial parks. However, the advance capital is not enough for developing the works.

 

In the next five years, the province will need at least VND6,880 billion to develop infrastructure works besides the industrial parks. Of the total, VND1,980 billion will be used for Cai Mep-Thi Vai inter-port transport system, VND330 billion for roads leading to An Phu ship building factory, VND950 billion for Cha Va roads and bridges, VND770 billion for resettlement areas for Long Son oil refining and petrochemical complex, VND2,650 billion for roads leading to industrial parks. The province is seeking permission from the government to develop power supply infrastructure for projects in Cai Mep-Thi Vai, Long Son and Ho Tram areas. The province is estimated to spend less than VND5,000 billion this year, including over VND2,465 billion for infrastructure works, said Ms Le Kim Huong, Director of the provincial Department of Planning and Investment.

 

The provincial Department of Planning and Investment proposed the management board of industrial parks in the province to mobilise advance investment sources from enterprises, ODA and an additional capital from the government for big industrial parks in the province. The province is in need of a total of VND12,765 billion to develop technical infrastructure works besides the industrial parks, according to calculations by the management board. However, the province has to date mobilised only VND2,600 billion, meeting around 20 % of the need. Capital for five key roads leading to the industrial parks and serving implementation of projects that are under construction or will be kicked off in the future is estimated at VND2,700 billion, nearly equal to the total investment of VND2,900 billion that the province spent on its development in 2008. They include roads leading to Vinaline plant and roads leading to Hocim cement plant.