Improving the efficiency of FDI investment in the Southeast Economic Zone

Hiep Hai (Southeast Economic Zone Management Board)• DNUM_BHZBCZCACA 08:00

(Baonghean) - Up to now, the Southeast Economic Zone and industrial parks in Nghe An have attracted 249 projects with a total registered capital of VND61,972.5 billion. Of which, there are 48 FDI projects with a total registered capital of USD825.28 million.

Many big projects

ThoseFDI enterprisesCurrently employing many workers in the Southeast Economic Zone (EZ), including BSE Electronics Vietnam Co., Ltd. (Korea) producing electronic components with 3,245 workers, Sangwoo Vietnam Co., Ltd. (Korea) producing garments with 1,457 workers, Matrix Vinh Co., Ltd. (China) producing toys with 1,004 workers. It is expected that in the near future, when the Luxshare - ICT Project and the Merry&Luxshare Project come into operation, they will be able to create jobs for about 20,000 workers.

Minister of Planning and Investment Nguyen Chi Dung listens to an introduction to the production line at the factory invested by LuxShare ICT Company in VSIP Nghe An Industrial Park. Photo: Thanh Duy

Currently, the Southeast Economic Zone Management Board is continuing to support procedures.investment licensefor large-scale projects such as: Juteng Group's Computer Case Manufacturing and Assembly Factory Project (200 million USD), Everwin USA Group's Electronic Equipment and Components Factory Project (200 million USD), Foxconn Electronic Components Manufacturing Project (300 million USD),...

Graphics: Lam Tung

Some large-scale FDI projects registered for investment in the Southeast Economic Zone and industrial parks of Nghe An province in the past include: Luxshare - ICT project invested by Luxshare ICT Nghe An Co., Ltd. (Hong Kong), with a total investment of 140 million USD; VSIP Nghe An Industrial, Urban and Service Park Project (Singapore) invested by VSIP Nghe An Co., Ltd. with a total investment of 76.4 million USD; WHA Industrial Zone -1 Nghe An Industrial Park Project invested by WHA Industrial Zone Nghe An Joint Stock Company (Thailand), with a total investment of 92.2 million USD.

Regarding production and business activities, as of August 2020, 26/43 FDI projects have come into operation, contributing to the growth and socio-economic development of Nghe An province in recent times. However, the contribution rate to the State budget revenue compared to domestic enterprises is still limited. Specifically, in 2019, the State budget revenue at FDI enterprises only accounted for 11.9% of the total State budget revenue of all enterprises in the Southeast Economic Zone.
FDI projects invested in the Southeast Economic Zone and industrial parks of Nghe An province in recent times are mainly projects invested in the fields of garment export, electronic component production, agricultural and forestry product processing and consumer goods production. These are investment fields that employ a large number of workers, helping Nghe An province solve a large number of local unskilled laborers, at the same time, creating conditions for local people to be able to provide accompanying services such as house rental, food service, essential goods business, etc.

Đóng hộp tại Nhà máy Royal Foods Khu công nghiệp Nam Cấm (Khu Kinh tế Đông Nam). Ảnh: Lâm Tùng

Canning at Royal Foods Factory in Nam Cam Industrial Park (Southeast Economic Zone). Photo: Lam Tung

In general, foreign direct investment projects in the Southeast Economic Zone and industrial parks of Nghe An province have contributed to effectively supporting the investment environment, pioneering in training, improving the qualifications and industrial style of workers, technicians and managers. Many foreign-invested enterprises have paid attention to fulfilling their social responsibilities to the community, participating in hunger eradication, poverty reduction and other volunteer activities.

However, FDI enterprises in the Southeast Economic Zone mainly have small project scales, the ratio of investment capital contribution and payment to the State budget of the foreign direct investment sector is still limited compared to domestic investment projects, the ratio of implemented capital and registered capital is still low.

Improving the quality of investment activities of FDI enterprises

To improve the efficiency of attracting FDI investment as well as improve the quality of operations of FDI enterprises in Nghe An, in the coming time, it is necessary to implement synchronous solutions such as:

The first,need to continue to improvepreferential mechanisms and policies, support investment, administrative reform, improve the province's investment and business environment; Effectively implement Resolution No. 58/NQ-CP dated April 27, 2020 of the Government implementing Resolution No. 50-NQ/TW dated August 20, 2019 of the Politburo on orientations for perfecting institutions and policies, improving the quality and effectiveness of foreign investment cooperation by 2030 into specific tasks, suitable to the practical situation of Nghe An Southeast Economic Zone.
Monday,Review and adjust the master plan for the Southeast Economic Zone, reshape functional areas and industrial parks to meet the requirements of attracting FDI in the period of 2020 - 2025 and the following years.

Hệ thống hạ tầng trong Khu công nghiệp WHA Industrial Zone 1 đã sẵn sàng. Ảnh: Trân Châu

The infrastructure system in WHA Industrial Zone 1 is ready. Photo: Tran Chau

Tuesday,Focus and prioritize resources to invest in the construction of complete and synchronized infrastructure, transportation, seaports, urban areas and essential hotel and resort services to create favorable conditions for FDI investors in the process of carrying out investment activities.

Wednesday,Develop plans and train local human resources to ensure qualifications and capacity to work in the foreign investment sector.

Thursday,Improve the efficiency of management, support and investment supervision of agencies and officials working in the field of foreign investment.

Friday,Attracting FDI requires investment promotion to be innovated, improving the quality and form of operation in the direction of proactively seeking and attracting investment. Regarding the partner structure, it is necessary to identify the attraction target as multinational corporations, corporations with advanced technology, source technology, in which, priority is given to projects associated with technology transfer, environmentally friendly. In the long term, it is necessary to study and attract investment projects that are development drivers and have high added value chains such as: production and assembly of automobiles and motorbikes; production and assembly of electronic components and computers; key mechanical industries, high-tech processing and manufacturing.