What does Nghe An do to attract foreign direct investment?

(Baonghean) - Editor's note:Nghe An Newspaper respectfully publishes comments and suggestions from Associate Professor, Dr. Major General Le Van Cuong, Former Director of the Institute of Strategy and Science, Ministry of Public Security.

1. History tells and practice proves: Every country that develops quickly and becomes rich is thanks to attracting a lot of foreign direct investment (FDI).

Singapore and South Korea, in just one generation (30-35 years), from a poor, backward country, became leading developed countries in the East Asia - West Pacific region and surpassed countries with the same starting point (30-40 years ago, they had the same level of development).

In the country, whichever province or city attracts many foreign direct investment projects (large FDI capital), that province or city develops rapidly, the people's lives are guaranteed at an above-average level, a part of them are rich thanks to honest labor. In the South, Binh Duong stands out, which used to be a poor province, but is now one of the richest in the country. In the North, Hung Yen used to be the poorest province in the Northern Delta, but thanks to attracting many FDI projects, this province is now one of the richest in the Red River Delta. Of course, we need to be alert and have clean hands in attracting FDI, otherwise a lot of FDI capital does not necessarily mean wealth, and can even bring about consequences. Notably, from the lesson of Formosa Ha Tinh...

Infrastructure construction in Dong Nam Economic Zone. Photo: CL

2. In the past 5-6 years, Nghe An has had positive changes in attracting FDI capital. Economic and social infrastructure has been invested heavily, the local government apparatus has become more dynamic, caring more for the people and a number of projects have been implemented. In general, the social face and economic strength of Nghe An have changed a lot. That is a signal, a positive aspect that needs to be preserved and promoted.

So what are the disadvantages and limitations of Nghe An?

To properly assess the limitations and shortcomings of Nghe An in attracting FDI capital, it is necessary to put the results obtained in two relationships: First, natural and human conditions; Second, Resolution No. 26 - NQ 26.NQ/TW of the Politburo dated July 30, 2013 on the direction and tasks of developing Nghe An province until 2020.

Let's take Vinh Phuc and Thai Nguyen, two northern mountainous provinces, to compare with Nghe An. Vinh Phuc and Thai Nguyen are two northern mountainous provinces, about 170 km from Hai Phong port and have no airport. However, these two provinces have attracted a very large amount of FDI capital, larger than Nghe An. Thanks to attracting many FDI projects, these two provinces have escaped poverty, Vinh Phuc is a rich province. In terms of transportation, roads, railways, sea routes, and air routes, Nghe An is much more convenient than Vinh Phuc and Thai Nguyen. Nghe An has more universities, colleges, and vocational schools than Vinh Phuc and Thai Nguyen.

If we do not admit that Nghe An is behind Vinh Phuc in attracting foreign direct investment (FDI), we must admit an obvious truth: Nghe An has great potential but has not been effectively exploited to attract FDI. In other words, we are letting Nghe An's internal strength sleep for too long!

Resolution 26 of the Politburo dated July 30, 2013 determined the goal of "Striving to build Nghe An into a fairly developed province by 2015, creating the foundation to basically become an industrial province by 2020...".

Vinh International Airport. Photo: PV

2015 is over.

By 2020, with 4 years and 3 months left, how can Nghe An “basically become an industrial province…”? Thus, Nghe An is in debt to the people (leaving resources dormant for too long) and missing its appointment with the Party (failing to achieve the target set by Resolution 26 of the Politburo).

3. What should be done to attract FDI? Foreign economic groups base their investment decisions on two basic factors: First: Simple procedures, clear and stable policies and laws; Second: Profitability - profitability.

50 years ago, in 1966, Singaporean Prime Minister Lee Kuan Yew had the opinion: To attract FDI, we must do 3 things: First, build a clean and strong state apparatus, with all officials and civil servants dedicated to their work and honest. Second, have skilled human resources and third, have good infrastructure (transportation, communications, health services, financial services, etc.). During his 30 years as Prime Minister, Mr. Lee Kuan Yew has done the above 3 things, and thanks to that, he has turned Singapore from a small, poor, backward island into a leading developed country in the world with a GDP per capita of about 40,000 USD in 2015.

Contact Nghe An today. Regarding infrastructure, it is necessary to continue investing in upgrading Vinh Airport and Cua Lo and Cua Hoi ports, upgrading the intra-provincial transportation system (roads). At the same time, complete a step of financial, telecommunications and medical services. Solving infrastructure is difficult because it requires large financial resources, but it is not the most difficult problem.

Regarding skilled human resources, it is not too difficult for Nghe An. Currently, Nghe An has 6 universities. In my opinion, it is necessary to invest heavily (mobilize capital from many sources) in Vinh University and Vinh Medical University to improve the quality of training. The remaining four universities should be transformed into universities training practical engineers following the model of Germany or Korea.

A class of Automotive Technology at Vinh University of Technical Education. Photo: My Ha

The most necessary and also the most difficult thing is to build a State management apparatus with a team of officials and civil servants who are honest and dedicated to the revival of Nghe An. Is this the bottleneck, the “bottleneck” that is hindering Nghe An’s FDI attraction?

I propose that the Provincial Party Committee and the People's Committee of Nghe An province organize a broad political activity with the theme: What to do and how to attract FDI? What must each Nghe An citizen, each Nghe An cadre and party member do to open up the flow of FDI into Uncle Ho's homeland? We cannot speak in general terms, because the people are tired of grandiose slogans. We must take the quantity and quality of FDI capital flowing into Nghe An as a measure of the effectiveness of studying and following Ho Chi Minh's morality. We have the right to be proud of being the children of the Soviet homeland, the homeland of Ho Chi Minh, so we must have the obligation to make Nghe An rich and strong, and when Nghe An is "inferior to its sisters and brothers", we must be proud, must know shame, and from there overcome ourselves. We need to go to Ha Tinh to learn to avoid failure and go to Binh Duong to know why they are successful.

Major generalLe Van Cuong-
Former Director of the Institute of Strategy and Science - Ministry of Public Security