Dong Nai Records Rapid Economic Growth in 2005

Garment, one of the sectors has high export turnover

Soaring oil prices boosted manufacturing raw material costs to a record high during the year 2005. Especially, the upward spirals in the price of oil had a dramatic effect on Vietnam’s industry production. Despite above difficulties, in 2005, Dong Nai’s industry had a production value of over VND 42,476 billion, up 21% over 2004. The figure showed a 5.6% increase compared with year target. Industrial growth in Dong Nai province has been much faster than the national average as well as higher than the growth of other cities and provinces such as Ho Chi Minh, Ha Noi, Hai Phong, Ba Ria-Vung Tau… This increase was primarily a result of an increase in revenues from central state-owned enterprises (SOEs) of 11.2%, the local state-owned enterprises of 15.7%, the non-State enterprises of 23.9%, and foreign-invested companies of 23.5%. Industrial output value from the following major industries surpassed last year’s level due to strong increases in food and beverage production of 31.4%, garments and leather dyeing of 35%, wood and forest product processing of 78.6% etc.  Besides, local SOEs have made remarkable achievements in investing in technology and equipment in recent years in order to improve the quality and enhance their competitiveness.  A total amount of VND 3,740 billion was invested over the period 2001-2005 to the development for these activities by provincial SOEs. In 2005, provincial SOEs were set to embark on major investment drives for construction, renovation and expansion amounting close to VND 523 billion. Of which, VND 184 billion was the invested amount of the local SOEs. Donafoods, Vikyno, Vinappro, the Dong Nai Water Supply Company… are typical SOEs that invested in new and innovative technology that help these companies raise their economic efficiency.

Bad weather conditions constituted the main problem faced by Dong Nai’s agriculture-forestry sector. In addition, breeding activity has been harmed by attempts to reduce bird flu risks. However, thanks to improvements in quality and markets, the export of some agricultural commodities has seen an optimistic view. Thus, the province’s total agricultural output value reached approximately VND 5,972 billion in 2005, up nearly 5.5% over 2004.

On the other hand, the attraction, promotion and facilitation of foreign direct investment are a central component of economic development strategies in Dong Nai province. The province has also enhanced oversea promotion with the aim of encouraging inward foreign direct investment in Dong Nai during the past years. At the same time, the province will continue to exert greater efforts to improve local investment environment. Dong Nai has proved itself as the most attractive destination in Vietnam for foreign investment.

In 2005, Dong Nai lured US$865 million in domestic investment capital including 100 new projects with registered capital of $500 million and 95 capital increasing projects with additional capital of US$365 million. The sum was US$ 201 million higher than the set target. Until the end of 2005, Dong Nai has licensed 698 foreign invested projects with a total registered capital of US$8 billion; of which, 470 projects have come into operation and 85 projects are under the construction with total capital of around US$4.45 billion, made up 55.6% compared to total registered capital. 

The dramatic growth of the foreign investment sector in Dong Nai has helped maintain a high export growth rate here. Its total export turnover in 2005 reached over US$3.179 billion, up 2.2% compared with year plan, accounted for nearly 10% of total export turnover of the country. Of this figure, US$2.9 billion came from foreign investment sector, US$195.5 million from local enterprises and US$82.4 million from central enterprises located in Dong Nai. The enterprises with high export turnover included Donafoods, Dona Biti’s, Dong Nai Rubber Co., Tin Nghia Co., Hoa Binh Co., Net Detergent Joint Stock Co., Tan Mai General Wood Processing Co. and Dong Tien Garment Co. etc. Fujitsu Vietnam heads the list of foreign enterprises that has high export turnover with US$458.8 million. It was followed by Pouchen Vietnam with over US$118 million, Changshin Vietnam with US$96.5 million, Vedan Vietnam above US$82 million, Dona Pacific Vietnam nearly US$81 million and Hwa Seung Vina around US$75 million, etc.

Thanks to quick economic growth and effective solutions in prevention of tax invasion, the province’s annual budget revenue for fiscal year 2005 hit VND7,358 billion, up 20% over 2004. In which, domestic collection amounted to VND4,573 billion and the rest came from import-export tax collection.

Dong Nai’s other economic fields such as bank credit sector, post and telecommunications, traffic and transport, service and trade also developed strongly in 2005. 

Xuan Phu