Economic and Industrial Zones Generating New Attraction

9:19:37 AM | 15/12/2021

Quang Tri province has made an important mark on economic growth and investment attraction. Especially, its economic zones and industrial zones are actively clearing the way with attractive incentives for investors to locate their projects. Vietnam Business Forum’s reporter has an exclusive interview with Mr. Tran Quang Trung, Deputy Director of Quang Tri Economic Zones Authority. Nguyen Dung reports.

Could you please depict the current picture of Quang Tri economic zones and industrial zones?

Currently, Quang Tri province is home to two economic zones and five industrial parks listed in the Vietnam Economic and Industrial Zone Development Plan. Lao Bao Special Economic and Commercial Zone (Huong Hoa district) is the first border gate economic zone to be established in the province (1998). Dong Nam Quang Tri Economic Zone (Hai Lang, Trieu Phong and Gio Linh districts) is a coastal economic zone, established in 2015, to create a driving force for local and regional development. Industrial parks include Nam Dong Ha (Dong Ha City), Quan Ngang (Gio Linh district), Tay Bac Ho Xa (Vinh Linh district), Quang Tri VSIP (Hai Lang district) and Trieu Phu (Trieu Phong district) in Dong Nam Quang Tri Economic Zone.

To date, mainly funded by the central and local budget, essential technical infrastructure such as internal roads, power grid and water supply and drainage systems in Lao Bao Special Economic - Commercial Zone, Nam Dong Ha Industrial Park and Quan Ngang Industrial Park were invested and built synchronously to meet investors’ needs. Currently, Nam Dong Ha Industrial Park has attracted 37 investment projects, which rented 90% of the area. Quan Ngang Industrial Park has 20 tenants, which hired 83% of the area. Concentrated industrial areas in Lao Bao Special Economic - Commercial Zone have attracted 70 investment projects and leased 80% of the rentable area.

Quang Tri Dong Nam Economic Zone has a total natural area of 23,792 ha, established under the Prime Minister's Decision 42/2015/QD-TTg dated September 16, 2015. Currently, this zone is actively conducting land compensation and site clearance to build infrastructure to attract investors. Many domestic and foreign strategic investors have come to learn and conduct investment procedures for their key projects.

In 2021, the Prime Minister licensed three infrastructure investment projects in Quang Tri Industrial Park (investor: a joint venture of VSIP - Amata - Sumitomo), Tay Bac Ho Xa Industrial Park (investor: Quang Anh Quang Tri Joint Stock Company) and Trieu Phu Industrial Park (investor: Trung Khoi Joint Stock Company). Currently, investors have completed relevant procedures for debuting construction in the first and second quarters of 2022.

Thus, compared to other provinces and cities in the country, Quang Tri has a quite diverse and vibrant picture of industrial zones and economic zones, including industrial zones, border gate economic zones and coastal economic zones, providing favorable conditions for comprehensive socioeconomic development.

Would you be kind enough to tell us about investment performance in economic and industrial zones and business performance of tenants in recent years?

Quang Tri Economic Zones Authority has strongly conducted administrative reforms, improved the business and investment environment, strengthened investment management, stepped up investment promotion, and supported businesses on their development course. Therefore, the face of local economic and industrial zones was lifted. Licensed investment projects increased in both number and scale.

Economic and industrial zones licensed 179 investment projects with a combined registered capital of VND230,038.86 billion (US$10 billion), including 10 foreign direct investment (FDI) projects with US$2.86 billion, 116 domestic projects with VND10,318.92 billion (US$440 million), and 62 projects under construction. In 2021, ten new investment projects were licensed into economic and economic zones with a total registered fund of VND63,081,928 billion (US$2.8 billion). In addition, the authority is guiding the completion of investment procedures for 41 projects with a total investment fund of VND237,670 billion (US$10.5 billion), including large-scale motivational projects invested by giant domestic and foreign corporations in Dong Nam Economic Zone.

Regarding business results, tenants’ investment projects in economic and industrial zones are increasingly effective and contribute more to local socioeconomic development. Every year, their revenue, industrial production value and tax payment rise by over 10% compared to the previous year.

In 2019, their production value totaled VND5,500 billion, up 13.4% over 2018), and their tax payment amounted to VND420 billion, up 14.4%. They employed 7,000 workers who were paid VND6 million each a month on average.

In 2020 and 2021, the COVID-19 epidemic affected business performances of many tenants. It is difficult for them to import inputs and components and export and sell outputs. They had to scale down production or even end production. Their output, revenue and tax payment all decreased deeply as a result.

In 2020, they made revenue of VND4,500 billion, paid VND315 billion of tax to the State Budget, employed 7,000 workers who were paid VND6.2 million each month on average.

In 2021, their business performance showed signs of recovery after the Government issued Resolution 128 on a safe and flexible response to the COVID-19 epidemic. Their total revenue and tax were estimated at VND5,200 billion and VND490 billion. in the year. Tenants in economic and industrial zones employed 7,400 workers, paid VND6 million a month on average.

In addition to boosting external investment promotion, the authority has actively carried out many solutions to attract new investors from existing ones. Would you mind telling us more about this?

Investment promotion is one of key tasks for the Quang Tri Economic Zones Authority. In addition to conducting traditional investment promotion tasks like organizing conferences and seminars and providing information and documents for investors, the authority carries out localized investment promotion by guiding and supporting investors to deal with emerging difficulties and obstacles to complete relevant legal procedures for project implementation; supporting and assisting investors to settle procedures for investment, production and distribution of goods, recruiting workers, especially hiring foreign experts and workers; guiding them to develop COVID-19 response plans, and developing appropriate production plans to realize dual goals, expanding vaccination policies for all workers in economic and industrial zones to ensure safety for businesses and their employees in the context of the COVID-19 epidemic.

Due to the complicated development of the COVID-19 epidemic and mobility restrictions in the world and in the country, the authority has developed an online promotion plan, fully equipped with essential facilities for online meeting and working with foreign and domestic investors to introduce local potential, advantages, preferential policies in economic and industrial zones; advised the Provincial People's Committee and relevant agencies to tackle difficulties and obstacles in investment procedures, planning, convert land-use purposes and forest use. Online investment promotion is launched regularly and continuously for authorities, investors and enterprises.

With its resolution to reform and provide reasonable support policies for investors and businesses, economic and industrial zones in Quang Tri province will hopefully continue to be a destination for investors in the coming time. In the near future, boosted by a new wave of investment flows, economic and industrial zones will make more positive, impressive and effective contributions to serve as a driving force and leverage for development of Quang Tri province, which will soon become an averagely developed province in the country as targeted by the 17th Provincial Party Congress.

By Vietnam Business Forum