Dong Nai's IPs loosen policies to attract investors

Dong Nai Province currently has 27 industrial parks (IPs) for small to medium-sized enterprises (SMEs) on a total area of over 1,502ha. Over the past many years, although the province laid a red carpet to welcome investors, the number of businesses in provincial IPs was still modest. Dong Nai should loosen its policies to attract more investors to IPs.

Illustrative image

Various preferences

Development of IPs for SMEs is a target of the province, in which development of infrastructure pertaining to industry structure transformation has become a priority. Dong Nai will have policies on promoting infrastructure investment to attract new investment projects, including support industry projects and projects manufacturing spearhead and key industrial products. The Dong Nai Province Department of Industry and Trade recommended the provincial People’s Committee to issue Resolution 189/2015/NQ-HDND regarding a number of policies on promoting provincial IPs’ development in the 2016-2020 period, in order to attract SMEs and relocated businesses to IPs.

SMEs relocated to IPs can have their relocation expenses, including infrastructure construction expenses, funded by the province at a rate of VND30,000 per square meter of leased land. The financial support doesn’t exceed VND300 million for a medium-sized enterprise, VND150 million for a small company and VND60 million for a household business. The provincial development fund allocates capital for site clearance in advance to districts so areas ready for investment in IPs can be created. IP investors can have their expenses of infrastructure construction, including ground leveling, local road construction, water supply and drainage system building, financed by the province. The financial assistance will be up to VND20 billion for each IP totaling 30ha upward in area and VND15 billion for each IP with area of less than 30ha. Dong Nai is expected to spend more than VND448 billion on realizing IP development promotion policies in the 2016-2020 period. Dong Nai will continue to review, adjust and suggest preferential policies for SMEs to promote investment in industrial and fine-art and handicraft production in the region.

Still hard to attract investors

Phu Thanh IP in Vinh Thanh Commune, Nhon Trach District is an effective facility of its kind. Businesses have leased all of the IP’s area. The IP-based enterprises currently provide jobs for more than 3,000 people. However, Phu Thanh is still encountering a number of difficulties that obstruct businesses’ operations: Road 25C hasn’t been connected to the IP, and no wastewater treatment system exists in the IP.

IP infrastructure investment procedures, especially site clearance compensation formalities remain complicated. A number of IPs find it difficult to attract investment capital for infrastructure development. Infrastructure development requires huge investment, while each IP has small area of no more than 75ha, so investment efficiency could be low and therefore doesn’t attract investors. Infrastructure construction is still tardy due to investors’ limited capability. This really affects attraction of investment to IPs.

Dong Nai Province People’s Committee Deputy Chairman Tran Van Vinh said that local authorities need to coordinate closely with IP investors to assist them to overcome difficulties. It is important to build workspaces for lease to secondary businesses to attract SMEs to provincial IPs. The authorities should learn about SMEs’ demands to develop IPs that satisfy SMEs’ actual needs.

(Source:VEN)