Industrial Zones- Growth Engine of Long An Province

5:13:26 PM | 23/6/2014

Since the two first industrial zones, Duc Hoa 1 and Duc Hoa 2 (now Xuyen A Industrial & Residential Park) were established 17 years ago, industrial zones (IZs) in Long An province have made important contributions to local development. Vietnam Business Forum Magazine has an interview with Mr Nguyen Van Tieu, Director of Long An Economic Zone Authority ((LAEZA), to learn more about this achievement. Kim Bang - Minh Tuan report.
Could you introduce the remarkable achievements of industrial zones in Long An province?
As of April 26, 2014, Long An province had 16 industrial zones in operation on a total area of 3,998 ha. They housed 804 investment projects, including 276 foreign direct investment (FDI) projects with a total registered capital of US$1.921 billion and 528 domestic investment projects capitalised at VND28,807 billion (US$1.4 billion). Tenants rented 46.36 per cent of commercial area.
Also as of April 26, 2014, more than 450 companies in EZs have gone into operation and employed around 72,500 workers who were paid with an average of VND3.5 million a month each. In 2013, they raked in revenue of VND30 trillion (nearly US$1.5 billion) and paid more than VND1,115 billion (US$50 million) to the State Budget.
Although the total area of IZs is less than 0.3 per cent of the province’s land area, they contribute over 20 per cent of State Budget revenue. All IZ developers and tenants are private companies. This is a typical characteristic of Long An province. Besides, IZs are converted fallow land and infertile farming land in Duc Hoa, Ben Luc and Can Giuoc districts into highly efficient contributors, job generators, urbanisation accelerators, and economic engines. IZs have attracted sector-grouped investors, thus enabling easier State management over business operation and reducing environmental pollution impacts.
How have IZs contributed to industrial growth, export expansion, employment and plan-based industrial development?
According to statistics, existing investment projects are divided into two basic groups: Core industries and supporting industries. The scale of supporting industries in Long An province-based IZs is small on lack of specific support policies. However, in addition to serving the domestic market, many manufacturers opt to export their products to other countries. This is an unreasonable problem but this is also a basis for encouraging other investors of core industries to source local products and attracting new subcontracting investors.
In recent years, IZs annually attract nearly 100 projects capitalised at VND5,000 billion and create thousands of jobs for workers in the province and surrounding localities, even well-trained workforce in Ho Chi Minh City. In industrial development planning, infrastructure enterprises are an important force to affect industrial development and industrial development planning. At present, Long Hau Industrial Park has attracted specifically Japanese and South Korean investors. The investment for workshop construction has attracted a large number of enterprises from these two countries to invest in primary and ancillary products. In industrial development planning, we do not state country-oriented investment attraction but this happens in reality. This is resulted from the activeness of infrastructure developers in industrial area zoning to suit specific investors. This is also a good condition to draw investors.
For current general planning, Long An province has carried out the initial planning relatively well. However, according to current laws, the province impossibly issues its own policies. The development of industrial zones is mostly affected by specific preference policies for IZ infrastructure investors.
What is the Long An industrial zone development orientation to attract Japanese and ASEAN investors?
Currently, Long An province-based industrial parks continue to complete infrastructure, electricity and water systems to meet investors. Besides, Long An provincial leaders pay much attention to upgrading transport infrastructure, power grid and water systems for current and prospective investors. The load upgrading of bridges on Provincial Road 830 is much appreciated and thanked by Japanese investors. IZ infrastructure companies staffed by young, dynamic, innovative employees always have new products for tenants. They connect enterprises with enterprises and stimulate the development of primary and supporting industries. What makes me happiest is the service and support of infrastructure developers as they attentively listen to investors from their regular meetings and adjust their restrictions to provide better services. That helps IZs in Long An province and we, State management agency, leaves good impression on investors.
Regarding State management aspects, we always define that administrative procedures applicable to enterprises is the most important factor and now I have advocated shortening the time for administrative procedures for investors like reducing the waiting time for investment certification from 15 working days to 10. With this change, we hope to help businesses save time for their projects as well as enhance our management. In addition to the above factor, we always maintain close ties with businesses to help them deal with their difficulties.
Besides the State management, investment promotion is our primary concern. The Long An Economic Zone Authority has established a multi-language information channel for IZs in a bid to help local and foreign businesses to easily access sufficient IZ information to make their investment decisions. Investors can visit our website to find out information about industrial areas quickly. In addition, they can contact the Long An Economic Zone Authority to seek solutions to their problems relating administrative procedures or their difficulties in operations. This will help investors to feel assured when they do business in Long An province.