Thai Nguyen Province Further Facilitating FDI Businesses

 

In the past years, with the great efforts of all-tier governments and localities, Thai Nguyen province’s socioeconomic development and investment environment have made positive progress and attracted many domestic and foreign investors.

 

Its economic growth averaged over 13 per cent a year. The share of industry and construction weighed up in the economic structure and the share of agriculture, forestry and fishery reduced. The industry has experienced a miraculous growth of 70.8 per cent a year. Handicraft and cottage industries were expanded strongly. Services developed in both scale and form. Budget revenue collection increased significantly. Agriculture, forestry, fisheries were stabilised and developed. Livestock husbandry accounted for an increasing share in agricultural production. The new countryside construction programme was deployed positively. Thai Nguyen province achieved important results in investment attraction and socioeconomic infrastructure planning and construction.

 

Economic sectors and business forms developed according to the Party and State orientations. State-owned enterprises (SOEs) were reshuffled to enhance production and business efficiency. The private sector developed at an exponential rate. Most companies were small and medium-sized. Collective business was encouraged for development. Foreign-led business increased expanded sharply in investment scale and product value.

 

In industrial production, in addition to traditional products in metallurgy, mechanical engineering, construction material production, mining and mineral processing, Thai Nguyen province has drawn a lot of investment capital for electronics and information technology industries from Samsung Group and gradually established high-tech industrial clusters in the province, thus helping restructure the industrial production from relying on mining and material processing to relying on assembly and manufacturing. Industrial production growth was only 1.8 per cent a year from 2011 to 2013 but it surged 222 per cent a year on average from 2014 to 2015. This achievement was driven by big FDI companies with high-level labour, modern management models, high brand reputation and strong competition in the market.

 

- To mobilise more capital for development investment. The total social investment capital was estimated at VND121,512 billion in five years from 2011 to 2015, 3.5 times more than that in the 2006-2010 period, accounting for 64 per cent of GDP (60 per cent came from domestic sources and 40 per cent was from foreign capital), of which the State Budget contributed 10 per cent, State investment credit was 8.1 per cent and private enterprises and people accounted for 41.9 per cent. Notably, FDI capital made up for 40.3 per cent. As at September 30, 2016, the province had over 700 domestic and foreign investment projects with a total registered capital of over VND250 trillion, including 116 FDI projects with US$7.09 billion of investment capital.

 

- Business area continues to develop. The province expects to have nearly 5,000 businesses by the end of 2016 and have 300-400 new business start-ups a year.

 

- Administrative reform, business registration and investment licensing make progress. The investment environment improvement scheme in 2010-2015 was carried out effectively. The province institutionalised and issued many investment mechanisms, investment incentives, investment promotion to provide favourable conditions for attracting foreign and domestic investors. Many solutions were implemented effectively to clear obstacles against enterprises and raise the provincial competitiveness index - PCI (Thai Nguyen ranked No. 57 out of 63 provinces and cities in 2012 but jumped to No. 7 in 2015), Public Administration Performance Index - PAPI), and public administration reform index - PAR. The province also created favourable conditions for Samsung Group of South Korea and its vendors to carry out their projects in industrial parks, thus resulting in a surge in foreign investment value in the province.

 

Without doubt, Thai Nguyen has actively improved the investment environment, diffused State policies and strengthened local interests to attract domestic and foreign investors, big international corporations and even small businesses. Thai Nguyen has called for investors with strong financial capacity and professional competence, especially those in high-tech and supporting industries; and actively coordinated with investors to ensure a secure sustainable environment and develop long-term sustainable business in the province.

 

According to the view of the State and the province, FDI is an important resource of the economy and couple with the domestic resource to create a synergy to achieve the objective of national industrialisation, modernisation and economic restructuring. Therefore, in the coming period, Thai Nguyen province will focus on FDI attraction policies to enhance the cooperation efficiency of FDI companies and domestic companies in the period of international integration and the fourth industrial revolution as follows:

 

+ Creating a strong shift in FDI attraction by carefully selecting high-quality projects creating high added values, using modern technologies and environmentally friendly technologies, particularly in information technology and biotechnology for agriculture; developing infrastructure, training human resources, performing research and development and developing modern services, etc.

 

+ Attracting large-scale projects with highly competitive products; joining global value chains administered by transnational corporations from which the province can develop supporting industries and enterprises; encouraging industrial projects to shift from outsourcing to processing and manufacturing; selecting big well-reputed investors and paying attention to smaller projects according to actual needs of each economic sector and locality.

 

+ Attracting FDI and improving the efficiency of cooperation between FDI firms and domestic companies in the province; carrying out consistent solutions to draw and improve FDI efficiency in industrial development environment.

 

+ Raising the quality of FDI and utilising FDI to speed up modern and effective economic restructuring to improve growth quality and enhance economic competitiveness in 2016-2020.

 

+ Encouraging investors to invest in forming production chain links for supporting industries to establish value chains; building investment promotion policies in line with the province’s overall investment promotion strategy; building and announcing the list of projects calling for FDI capital projects in 2016-2020, with a vision to 2030.

 

+ Creating the environment and policies supportive of business start-up and business renovation; establishing specialised industrial clusters and introducing localised economic development policies; intensifying examination and monitoring over related sectors and units.

 

Thai Nguyen holds favourable potential and advantages for socioeconomic development. It is a convenient trade hub for foreign investors seeking to do business with the northern mountainous area. The province still has a lot of opportunities for investors to grasp and the province always treasures and pins high hopes on effective investment cooperation with investors.