Foreign developers of urban areas and industrial parks are eyeing Vietnam with renewed vigour, due to a rise in foreign direct investment.
Foreign developers of urban areas and industrial parks are eyeing Vietnam with renewed vigour, due to a rise in foreign direct investment.
The Republic of Korea (ROK)’s KovinaNet Company last week signed a co-operation deal with the Nghe An People’s Committee for the construction of an US$80 million industrial park (IP) in the central province’s Hoang Mai town.
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The company’s president Son Jae Sell said this project will cover 30 to 90 hectares of land. After construction is completed, KovinaNet will call for investments from 30-40 Korean firms operating in the sectors of electronics, auto spare parts, and lighting.
Currently, eight Korean firms have expressed their interest to locate their plants in the upcoming IP.
A group of nearly 20 Taiwanese IP developers have worked with the Ministry of Planning and Investment’s (MPI) Economic Zone Management Department on the possibilities of implementing multi-million dollar IP and urban areas projects in Vietnam.
Among these developers, WUS Printed Circuit Co.’s president Hsu Huan Chung said his firm is about to develop a large IP in Vietnam.
“We are selecting locations, either in the north or south of Vietnam,” he said.
Meanwhile, Hua Tsai Paints Co. wants to implement a multi-million dollar project consisting of an IP, urban areas, and infrastructure development in the country.
The firm’s president Yu Wen Hua said Vietnam needs tens of billions of US dollars for developing high-quality IPs and urban areas.
“We will work with Vietnam’s authorised agencies on planning our project,” Hua said.
Also, Chao Chien Min, deputy director general of the Export Processing Zone Administration under Taiwan’s Ministry of Economic Affairs, told MPI’s Economic Zone Management Department that his administration wishes to co-operate with Vietnam in planning, designing, and constructing smart IPs and urban areas throughout the country.
“We want MPI to introduce Vietnamese partners to us so we can co-operate with them as soon as possible,” Min said.
One of the reasons Taiwanese firms wish to implement their projects in Vietnam, Min noted, is that a great deal of foreign direct investment (FDI) has poured into the country, most of which is going into IPs and economic zones.
“Investing in IP development in Vietnam can bring promising profits,” Chung of WUS Printed Circuit said.
In the year to October 20, 2016, Vietnam licensed 2,061 new FDI projects, registered at over US$12.26 billion – up 24.4% in number of projects and down 1.3% in registered capital – compared to 2015.
In addition, another 967 already-licensed projects received capital infusions of US$5.35 billion. As a result, the total newly-registered and newly-added capital since early this year reached over US$17.6 billion.
The 10-month FDI disbursement is estimated to be US$12.7 billion, up 7.6% year-on-year.
Vu Quoc Huy, head of MPI’s Economic Zone Management Department, said that since the beginning of this year, many foreign firms came to Vietnam to seek investment opportunities in IP and urban area development. Many of them have been licensed.
Amata Vietnam, a subsidiary of Thailand’s industrial estate developer Amata Corporation, is reportedly planning to build a US$200 million project named Amata City Long Thanh during the next two years in the southern province of Dong Nai.
This project is expected to cover 3,200 acres of land. Forty per cent will be industrial land while 60% will be taken up by accommodations and other commercial buildings.
The industrial estate will be developed first, while the accommodations will be built in 2019, after Vietnam’s government completes the construction of an expressway running near the Amata City Long Thanh project.
Amata Vietnam, one of the top three foreign-owned industrial estate developers in the country, invested in its first project – Amata City Bien Hoa – about 22 years ago. So far, it has injected around US$800 million into development in Vietnam.
Meanwhile, Minister of Planning and Investment Nguyen Chi Dung recently discussed with the Singaporean government the possibility to open an eighth Vietnam-Singapore Industrial Park (VSIP) in the central province of Quang Tri.
VSIP is a joint venture between Becamex IDC Corporation and a Singaporean consortium led by Sembcorp Development. Since the inception of the first VSIP 20 years ago, there are now seven VSIPs nationwide.
