Dak Lak Industry and Trade: Towards Sound Growth in Central Highlands

Over the past five years, the industry and trade sector of Dak Lak province has gained remarkable achievements. The local industry and trade sector are pursuing major goals in the coming time.

In the 2005-2009 period, the province gained annual industrial growth rate of 23 per cent. This year, it targets an on-year growth of 17 per cent, to VND3.75 trillion. The industrial sector accounts for an increasing ratio in the local economic structure.

 

The province’s industrial production scale has considerably increased, along with the quality and varieties of products to meet global demand. The processing industry makes up a big ratio of the provincial industrial sector (over 66 percent) and is the province’s key sector, meeting demand for agro-forestry-fishery processing. Last year, investment for the province’s industrial sector was estimated at VND4.25 trillion. Of the sum, VND42.88 trillion was from the state budget and VND4.209 trillion from other economic sectors.

 

In the year, 14 projects were completed and put into operation, including 13 industrial projects (rubber processing, beer, tuynel brick, engineering and wood); and Buon Kop hydropower plant with an annual capacity of 280MW. This year, an additional 43 projects will be implemented, including 28 industrial projects to produce fertiliser, process food and agricultural products and construction materials, nine hydropower plants and six industrial parks and complexes.

 

Hydropower plants are attracting large scale investment, a breakthrough for the local industrial sector. Total capacity of the province’s hydropower plants scheduled for investment by 2015 is estimated at over 900 MW. At present, 320 MW has been put into operation and the figure is expected to reach 620 MW after 2010 (commercial power output estimated at some 2.85 billion kwh). The province is home to big power projects such as Buon Kop, Krong H’Nang, Se Re Poc 3, Se Re Poc 4, Se Re Poc 4A and many small and medium-sized hydropower projects being carried out by investors. Among those, Krong Hin 2 with capacity of 5 MW and 12-MW Krong Kmar, Dray H’linh 1 and 2 have become operational.

 

Power transmission and distribution satisfies local production and consumption demand. To date, all local communes and wards have been connected to the national power grid and 90 per cent of local households are provided with power.

 

Mineral companies, which previously only exploited and processed construction materials, have expanded their operations to make new products such as tuynel bricks and granite ashlar paving stones to meet local needs.

Dak Lak has many favourable conditions for trade development in the Central Highlands region. With good natural conditions of abundant natural and forestry resources, the province is a major source for products such as coffee, pepper, maize and cassava. Dak Lak is Vietnam’s hub for agricultural products. Among those, coffee accounts for over half of the country’s total output. Buon Ma Thuot coffee was granted with geographical indicator register by the National Office of Intellectual Property of Vietnam.

Regarding business in the domestic market, retail sales in the province reached VND5.32 trillion in 2005, and the figure climbed to VND15.78 trillion in 2009. This year, the province targets VND17.8 trillion in retail sales, an on-year growth of 27.3 per cent.

 

In general, despite being impacted by the global economic slowdown, the circulation of goods and services in the province is stable. Diversified goods meet the needs of local consumers, particularly those in remote and mountainous areas.

 

Total investment for the province’s investment and trade sector was estimated at VND1.238 trillion, including VND93.26 billion from the state budget for markets and e-trade system and VND1.145 billion from enterprises. In 2009, five trade projects worth VND109 billion were put into operation, including one market, two supermarkets, and two trade and office centres; 18 projects valued at VND1.115 trillion carried over from 2009 will be continued, including one market and 17 supermarket and trade centre projects.

 

Exports are a strength for Dak Lak. In 2009, the province gained export revenue of US$600 million and the figure is expected at US$620 million, up 16.3 per cent on-year. Besides major exports such as coffee, cacao, rubber and starch, Dak Lak has focused on reforming technology and diversifying product processing, such as instant coffee, wood, traditional handicraft products and rattan. In the long term, the province will export new agricultural products like cacao. However, coffee makes up 80 per cent of the province’s total export revenue. The province exports its products to more than 70 countries and territories, including the big markets of the US, Japan, the UK, Germany and Switzerland.