8:56:16 PM | 8/11/2011
In the last 18 years, since re-establishment in 1992, Tra Vinh has been making efforts toward socio-economic development. The province has gained many important achievements such as creating an open and attractive investment environment, and improving people’s material and cultural situation.
Focusing on key economic fields
130km from Ho Chi Minh City, Tra Vinh has a full system of rivers and waterways with 65km of coastline favourable for tourism development, sea transportation and aquaculture. Tra Vinh is a coastal province of the Mekong Delta, surrounded by the Tien and Hau Rivers, and the East Sea. With some key national projects implemented by the Central Government, Tra Vinh has good conditions for constructing its international transit port at Dinh An.
Besides a strategic location, Tra Vinh has many advantages for agricultural development with rice, industrial trees, fruit trees, cattle husbandry and aquiculture. Tra Vinh’s strategy is to positively transform its agriculture structure. Local scientists are very successful in replicating high-yield rice varieties with high quality. From 2000, rice cultivation area has decreased but output is up to over 1 million tons/year, twice as much as in 1992. Nearly half the land in Tra Vinh is affected by salty water. The areas affected by increasing salinity, including Duyen Hai, Tra Cu and Cau Ngang, can be used to raise tiger prawns. While other areas with fresh water like Chau Thanh, Cau Ke, Tieu Can, Cang Long and Tra Vinh City are suitable for raising shrimp, tra and basa fish. In terms of industry, Tra Vinh puts a strong emphasis on processing industries, especially processing frozen shrimp for export, with a capacity of 14,000tons/year. Some other industries like pharmaceuticals, sugar, dried coconut, mineral water and textiles also make big contributions to the province’s economic development.
Other small industries such as sedge mat weaving and rush carpet for export are very profitable. In addition, Tra Vinh has over 27,000 hectares of sandy band soil suitable for industrial development. Its 65 km coast and interlacing river system make it very convenient for aquiculture and water transport. Particularly, Tra Vinh has Dinh An Economic Zone, Long Duc Industrial Zone, Co Chien Industrial Zone and Cau Quan Industrial Zone, attracting construction and investment projects to the province. More importantly, the province has created many preferential policies for investors, with comprehensive technical infrastructure and a strong road and waterway transport network exchanging goods. Some other incentives include free tax policy for investment projects in new business fields or on the preferential list; low land rents; supporting policies for training and technology transfer, technical infrastructure, and electricity and water supply. At the same time, Tra Vinh offers some services free of charge, such as survey, establishment of investment projects, investment licensing, and land compensation and clearance. All these make an attractive investment environment in Tra Vinh.
Average GDP growth over 5 years: 11.4 percent
Although Tra Vinh has a lower starting point than other localities, the province has made big efforts in the past few years. In 2005-2010, the province has achieved average GDP growth of 11.64 percent, in which agriculture enjoys an increase of 3.15 percent, forestry10.95 percent, aquaculture 6.94 percent, industry 15.83 percent, construction 29.5 percent, and service 20.87 percent. Economic structure has changed for the better since 2005. Specifically, the agriculture-forestry-aquaculture sector fell from 59.82 percent in 2005 to 43.85 percent in 2010, construction and industry grew from 16.68 percent to 23.59 percent; and services grew from 23.5 percent to 32.56 percent. Total mobilized capital is VND18.186 billion, an annual average growth of 17.8 percent. Total budget reaches VND 655 billion, an annual average growth of 10 percent. In addition, Tra Vinh has created about 50,000 jobs for local people, the rate of trained labourers is about 28 percent, the poverty rate falls an average 3 percent/year (to 16.4 percent), per capita income reaches VND11.625 million, equivalent to USD 653.
Tra Vinh continues to invest in socio-economic infrastructure, especially irrigation, water, electricity and telecommunications systems. Besides, the province has done a good job with social policies, national defence and social security. In 2009-2010, Tra Vinh received special attention from the Government with many important projects: Duyen Hai Thermo-power centre; expansion and upgrading National Road 53, 54 and 60; Dinh An economic zone; Cau Quan industrial park; and Co Chien Industrial Park. Tra Vinh has attracted special attention from local and foreign investors through 3 trade promotion seminars in Ho Chi Minh City, Ha Noi and Tra Vinh, 23 agreements with 33 projects were signed. These are premises for Tra Vinh to reach its stated goals and objectives for socio-economic development in the following years.
In the period of 2010-2015, Tra Vinh strives to achieve economic growth of 14 percent/year; average income of VND 34 million per capita/year (equivalent to US$ 1,500), twice as high as that in 2010. GDP structure by 2015 is predicted to be: agriculture-forestry-fishery over 38 percent, industry & construction over 28 percent and services over 33 percent; export value in 2015 will reach US$ 300 million, 2.14 times that in 2010. The total province budget in should reach twice as high as in 2010, with expected annual growth of 16 percent; total investment capital for social development in 5 years will be VND 76.621 billion. Till 2015, school attendance rates should reach 99.90 percent at primary schools, 98.5 percent at the secondary level and 80 percent at the high school level. The province also strives to supply potable water to 95 percent of rural areas and 97 percent of urban areas; sustaining political and social security.
A strong emphasis will be put on doing research and applying advanced production technology in agriculture, and constructing concentrated agricultural areas. At the same time, Tra Vinh also focuses on industry and tourism development suitable with the province’s potential; transferring the economic structure with an increasing proportion of industry and service, linking with neighbouring provinces to create new development. In addition, the provinces also takes care of cultural-social activities, improving training and education quality, vocational training, preparing a highly skilled labour force for the new period of development, ensuring social security, and strengthening scientific-technology potential to serve socio-economic development.
Dinh An economic zone - A platform for Tra Vinh economy
Recently, the Prime Minister approved Decision No 69/2009/QD-TTg on establishing Dinh An Economic Zone, located at Tra Cu & Duyen Hai districts, Tra Vinh province (construction and development of marine industries, tourism, and the port economy, along with a port-related non-tariff area and an urban residential complex, restaurants and hotels). The project is one of 15 coastal economic zones to be set up in the country in accordance with a decision signed by Prime Minister Nguyen Tan Dung. Dinh An Economic Zone is expected to pave the way for Tra Vinh to integrate into the global economy and to create new driving-force for the whole Mekong Delta area.
Dinh An economic zone consists of Dinh An commune and some other communes in Western National Road 53 and Southern provincial road 914 of Tra Cu and Duyen Hai districts, bordered by Cau Ngang to the North and the East Sea to the West, South and East. When completed, the project will connect Southern coastal provinces with the Mekong Delta’s satellite urban areas. According to the Decision, Dinh An economic zone will have an area of 39,020-hectare with initial capital of US$ 4.5 billion. This is a complex of industrial parks, sea ports, urban areas, finance, telecommunications, trade, service, tourism and agriculture-forestry-fishery connecting with marine economy. The project is divided into two phases. The first phase’s objective - carried out on about 15,400 hectares - (till 2020) is to build some basic items of infrastructure, building a fairway for large vessels (over 10,000 DWT) to enter Hau River and other rivers, constructing Duyen Hai Thermo-Power centre, Ba Dong Tourism Resort and some other urban areas in Duyen Hai & Dinh An towns. It is expected at the end of the first phase that population of Dinh An economic zone will reach 200,000 people, of which urban population accounts for 90,000 people.
The next phase (till 2030) will focus on investment and development. Dinh An economic zone will include a modern oil refinery with state of the art technology (US); deepwater port for 50,000DWT ships, warehouse; shipbuilding yard; supporting industries; tariff area; urban area and other technical infrastructure, including water supply of 150liter /person /day and power supply of 1,000kwh/person/year. In this period, according to local labour managers, Dinh An economic zone will attract around 40,000 labourers to the region.
When completed, Dinh An will become one of the economic-cultural centres of Tra Vinh province. It is also a gateway for international goods exchange and for the whole Mekong Delta area, because waterway routes to Can Tho and An Giang ports are still not smooth. Many heavyweight ships (over 10,000DWT) cannot enter the above ports, making exporters pay extra fees to use Sai Gon Port, totalling US$ millions/year. However, in the coming time, investors in the Mekong Delta area will get peace of mind because a deepwater port with capacity of 50,000DWT will be built at Dinh An. Together with its considerable advantage of location, Dinh An Economic zone will push up Tra Vinh’s social-economic development, making it a gateway for Mekong Delta agricultural products.
According to the approval of the Prime Minister, Dinh An Economic Zone will focus on developing fields such as electricity production, steel, petrochemical, marine shipbuilding, port economy, non-tariff area, residential and urban areas. Investors in Dinh An economic zone will benefit from various tax preference policies, including 10 percent tax for 15 years; or 4 years tax-free and a 50 percent tax reduction over the 9 following years. (In accordance with Decree 124/2008/ND-CP on corporate income tax). Preferential investment projects stipulated by the State include construction and trading infrastructure for non-tariff area, high-tech projects and large-scale projects. These projects will get free land rent for 11 years (Decree No142/2005 ND-CP dated November 14, 2005; Decree No 69/2009/ ND-CP dated August 13, 2009). Projects on the list for investment encouragement will operate tax-free for 15 years. Land rent price (if not stipulated) will be set at the lowest price in accordance with Tra Vinh Provincial People’s committee. In terms of corporate income tax, there are some preferred or free policies for importing goods and equipment to create favourable conditions for investors (Decree No149/2005 ND-CP), and a 50 percent personal income tax reduction for labourers in Dinh An economic zone. In addition, there will be flexibility in adjusting tax policy in tariff area, including export-import goods, processing, recycling or assembling.
If everything is on schedule, Dinh An economic zone will be started at the end of Quarter 1, 2011. The investor of the project is now finishing necessary procedures for receiving financial resources up to US$ 4.5 billion sponsored by L2G Holdings Company. The amount can be much more if the project is on schedule.
Economic potential of Tra Vinh is huge, the province has made big efforts but its inner force is limited, so Tra Vinh needs support from the Government, provinces and especially from local and foreign investors to bring it to its full potential. Tra Vinh is now opening its door for investors with friendliness and hospitality, together with open and preferred policies, making an attractive investment environment.