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| Dr. Phan Hữu Thắng, Chairman of the Executive Committee of the Financial Association of Việt Nam’s Industrial Zones. — Photo courtesy of Trade and Investment Promotion Centre |
Dr. Phan Hữu Thắng, Chairman of the Vietnam Industrial Park Finance Association spoke to Hải Quan (Customs) online newspaper reiterating that the success of developing an industrial zone largely depends on the enterprises and entrepreneurs as well as the investors of the industrial zone
How do you evaluate the current status of investment attraction for the development of industrial zones?
Reflecting on the evolution of Việt Nam’s industrial zone system and recent efforts to attract foreign investment, it’s evident that a significant portion of foreign capital is directed towards these zones.
Annually, industrial and economic zones receive 60-70 per cent of the nation’s total FDI, a figure that continues to climb. This underscores the pivotal role these zones play in Việt Nam’s economic landscape.
Despite a 32-year development journey since the establishment of Việt Nam’s first NOMURA industrial zone in Hải Phòng City in 1992, progress has been marked by fluctuations influenced by external factors like capital sources, market conditions, and political factors.
While Việt Nam’s industrial zones have been instrumental in driving economic growth, there remain persistent challenges that demand swift attention and resolution.
What specific challenges exist in this issue?
These challenges include several facets, starting with the underutilisation of industrial zones, as evidenced by the 121 out of 414 zones currently undergoing land clearance compensation processes, resulting in a significant underutilisation of valuable economic land resources.
While strides have been made in enhancing the technical infrastructure of industrial zones, they still lack the modern amenities necessary to compete effectively on regional and international stages.
The prevailing development model of industrial zones remains multifaceted, primarily relying on land potential rather than embracing innovative models like high-tech or eco-industrial zones. This oversight hinders the fulfilment of international investors’ demands for sustainable, environmentally friendly development, in spite of the path of Việt Nam’s green economic initiatives.
Despite the Government’s efforts to address housing shortages for industrial workers and the broader social housing dilemma, resolving these issues requires sustained, long-term strategies.
Although Decree 35/2022 NĐ-CP has been enacted to streamline the management of economic and industrial zones, delineating clear definitions for various zone types, the establishment of green industrial zones geared towards waste reduction and environmental preservation remains encumbered by numerous challenges.
While regulatory frameworks and development guidelines for industrial zones have been outlined, they are dispersed across a multitude of legal documents, complicating administrative procedures and necessitating further streamlining.
Could you please explain the factors influencing the development of industrial zones? Which factor plays the primary role?
The essential factors for the complete and modern development of industrial zones include the State management mechanism. This encompasses development orientation, legal frameworks, and administrative regulations for procedures. Financial resources are also crucial for investment and business activities.
In addition to business interests, individuals and enterprises must fulfil obligations to the State, employees, and uphold high social responsibilities.
Lastly, leadership’s vision is pivotal in evaluating trends comprehensively and finding the most appropriate and effective approaches.
The success of industrial zone development largely rests on the shoulders of enterprises, entrepreneurs, and investors themselves. While the State’s role primarily involves refining the management and developmental mechanisms of industrial zones, with regulatory aspects serving as a cornerstone for the entire system, the remaining factors predominantly lie within the purview of enterprises and are contingent on the leadership’s capabilities.
However, in the midst of the rapidly evolving scientific and technological revolution, companies must adapt to become digital enterprises. Digital transformation is no longer merely a distant vision but an imperative reality. Enterprises must equip themselves with the requisite knowledge and technical capabilities to participate in Vietnam’s economy and the global digital transformation process, thereby avoiding stagnation.
Thus, the development of Việt Nam’s industrial zone system is fundamentally driven by enterprise development and contributions, which are bolstered by the judicious leveraging of external capital to ensure investment quality and enhance national defence and security. — VNS
This article was first posted on Vietnam News