Lesson 2: Long-standing unfinished projects

(Baonghean)A concerning situation is occurring at the Nam Cam Industrial Park (Nghi Loc District, Nghe An Province): Many projects are being implemented at a slow pace, with low investment capital and construction progress far exceeding the regulations stipulated in the investment certificates. Many projects have been allocated land for a long time, but the investors have hardly started construction, leaving the land barren for years.

Mr. Dau Van Nam, Director of Nam Cam Industrial Park Infrastructure Development Company, stated: In Nam Cam Industrial Park, businesses have signed land lease contracts for almost all the cleared land (land already cleared), but very few businesses are actually operating and making a profit. The rest are barely making progress, or have not implemented anything for a decade or more. Because of this, 16 projects have been revoked. These projects include: a ready-mix concrete and block factory invested by Truong Thinh JSC; a fish and shrimp feed factory (Bien Xanh JSC); a granite processing plant (Hoa Cuong B&A Co., Ltd.); a biodegradable packaging and paper factory (Binh Minh Co., Ltd. - Hanoi); an animal feed factory (TAGS Nhuan Duc Co., Ltd.); a warehousing and mechanical repair center (Binh Minh Trading & Transportation Co., Ltd., Nghe An); a barite and limestone powder processing plant for export (Phuc Thinh Company); a white limestone processing plant (Wolkem Vietnam Co., Ltd.); and a superfine limestone powder processing plant (Freeland Universal Co., Ltd.)... Many projects registered with large total investment capital include a factory producing high-tech plastic products and building materials invested by New Technology Development and Investment Services JSC with nearly 170 billion VND, or a superfine limestone powder processing plant (Co., Ltd. Freeland Universal registered an investment of $8 million on over 6.5 hectares of land... all of which are subject to expropriation.

The Environmentally Friendly Packaging Factory project, invested by Toan Thang Packaging Joint Stock Company, was granted an investment certificate in April 2007 in Zone C, covering an area of ​​25,409 m2, with a committed completion time of 12 months. The investor completed some items such as site leveling and the construction of a canteen, but some other items were left unfinished and construction has been halted since the beginning of 2010. The project is 40 months behind schedule. The Management Board of the Southeast Economic Zone has conducted inspections, urged progress, and issued written requests to the investor to continue construction, but the project remains stalled. In light of this situation, the Management Board of the Southeast Economic Zone issued Document No. 519/KKT-DT dated August 16, 2011, announcing the revocation of the investment certificate and the termination of the project's operations. The reason given by the investor for the delay is difficulty in raising capital. The company has made efforts to find partners and raise funds for the project. However, this reason is unconvincing. According to our sources, the investor applied for a bank loan in September 2009 and completed the loan procedures on March 31, 2011, for 63.9 billion VND, with the first disbursement of over 14 billion VND already announced. However, to date, the company has not commenced construction on the unfinished items at the project site. Inspection revealed that since the investor received the bank loan for the project, no construction unit has been present at the site.

A typical example of the procrastination in resolving the consequences is the case of Phuc Thinh Company, the investor of the "Barite and Limestone Powder Processing Plant for Export" project, which was granted Investment Certificate No. 06/GP-BQL on November 27, 2002, by the Management Board of Nghe An Industrial Parks (now the Management Board of the Southeast Nghe An Economic Zone). Visiting the Nam Cam Industrial Park one day in mid-September, the large plot of land belonging to Phuc Thinh Company, located in Zone B, outside the fence, had a row of abandoned single-story buildings as security guards. The security guard stated that the land had long been leased by another company for dumping raw materials.

In 2007, nearly five years after the investment certificate was issued, Phuc Thinh Company lacked the capacity to complete and operate the project. Therefore, on August 9, 2007, the Management Board of Nghe An Industrial Parks issued a decision to revoke the investment certificate. After revoking the investment certificate, the Management Board of the Southeast Nghe An Economic Zone directed the Industrial Park Development Company to liquidate the land lease contract with Phuc Thinh Company. However, after two years, the liquidation of the land lease contract has still not been completed. The 4.05-hectare plot of land granted to Phuc Thinh Company has remained unused for over eight years, causing significant losses to the State. To definitively resolve this situation, the Management Board of the Southeast Nghe An Economic Zone is proposing that the Provincial People's Committee establish an appraisal council to determine the value of the investment assets at Lot C35, Zone C, Nam Cam Industrial Park.

The Thành Hưng Company's project to produce various types of limestone powder is also equally complicated. This project, licensed in 2008 in Zone A, had its license revoked in October 2010. After the revocation, the company filed a lawsuit against the Southeast Economic Zone Management Board. Currently, the court is gathering evidence for trial. The final verdict is unknown, but the case has consumed considerable time, effort, and money for all parties involved.

Thu Huyen