IZs development needs planning to attract FDI

HÀ NỘI – The development of industrial zones (IZs) needs a comprehensive plan to capture the transition of the foreign direct investment (FDI) inflow spurred by trade wars and the COVID- 一 九 pandemic in which Việt Nam has significant opportunities to become the next global factory.

The global production transition out of China spurred by the US – China trade wars and the COVID- 一 九 pandemic recently gave a push to the development of IZs in Việt Nam.

In the first three months of this year, five new IZs were founded with a total area of  八00 hectares, compared with only four in the whole of  二0 一 九.

Some deserted IZs found new developers and had infrastructure developed to get ready for leasing, such as the  四 六-hectare An Phát High Tech Industrial Park in the northern province of Hải Dương.

Sử Ngọc Khương, senior director of investment, Savills Việt Nam, said that a lot of domestic and foreign investors were finding locations in industrial zones for investment, some wanted to become developers of industrial parks while some others planned to expand factories.

Đỗ Nhất Hoàng, Director of the Ministry of Planning and Investment’s Foreign Investment Agency, said that a close watch was being kept on the transition of global production, which was opening opportunities for a number of countries, including Việt Nam.

Hoàng said that the agency was working with foreign investors who were considering moving to Việt Nam so as to raise policies which would create a favourable investment climate.

He added that the Law on Investment was being amended to enable Việt Nam to capture the FDI inflow in the context of the global production transition.

The ministry said that the development of IZs needed a strategy which aimed at sustainability, economic efficiency and environmental friendliness.

According to Nguyễn Văn Toàn, Deputy President of Việt Nam’s Association of Foreign Invested Enterprises, the infrastructure of IZs remained a limitation. Toàn said that many IZs did not have good transport connectivity.

“A comprehensive plan is needed for the development of IZs,” Toàn said, adding that the plan would prevent rampant development of IZs nationwide and enable Việt Nam to capture the opportunities from the global production transition.

Việt Nam targeted that the total registered capital into IZs would reach VNĐ 二. 七- 三. 二 quadrillion (US$ 一 一 六- 一 三 八 billion) in domestic investment and $ 二 八0- 三 三0 billion in FDI by  二0 三0. Realised capital was expected at VNĐ 一. 五 - 二 quadrillion and $ 二 四0- 二 九0 billion, respectively, according to the ministry.

In addition, IZs would generate jobs for  五- 六 million workers in  二0 二 五 and  七- 八 million in  二0 三0.

The promulgation of the Law on Foreign Investment in  一 九 八 七 created conditions for the formation and development of IZs which had so far contributed significantly to attracting the FDI flow into the country.

Statistics of the Ministry of Planning and Investment showed that as of March,  三 三 五 IZs were founded with a total area of  九 七, 八00 hectares,  二0 六 of which were operational with a total area of  六 八, 七00 hectares. The average occupancy rate was  七 五. 六 per cent. – VNS