Moc Bai border gate EZ: supermarkets closed
Supermarkets’ doors shut
The first days of July 2009 prove were the quietest days of the Moc Bai EZ since it put duty-free shops into operation. The roads to the supermarkets were empty, while the parking lot in front of the trade centre was deserted.
Le Van Tuong, Deputy Head of the Moc Bai Border Gate EZ, told newspaper that some trade establishments have temporarily shut doors for stock taking, while others have closed doors to adjust software for calculating taxes. Tuong said that most establishments have shut down because of the new regulations on selling duty-free goods. The new regulations stipulate that as of July 1, domestic visitors and tourists are not allowed to purchase goods duty-free in Moc Bai.“Enterprises have been living on trading duty-free goods. With the new regulations, they fear that the profit will not be high enough to cover expenses,” Tuong said.
According to the director of an enterprise in Moc Bai, the prices of goods in Moc Bai will be much higher than the prices in HCM City with import tax, VAT, luxury tax and the transport fee for carrying goods from Saigon port to Moc Bai. Therefore, Moc Bai will not attract visitors anymore.
A Viet Kieu from Canada, who has a stall at Hiep Thanh Trade Centre, related that he injected $12 million to trade in the area. However, his business is getting more and more difficult as Government policies have become tightened. At first, every visitor was allowed to purchase 500,000 dong per person per day worth of duty-free goods. The figure was then lowered to 500,000 dong per person per week, and now the purchase of duty-free goods is prohibited.“If the situation cannot be improved, I will have to close my business here,” he said.
According to Tuong, the Tay Ninh provincial people’s committee has sent a dispatch to the Government, proposing it reconsider some policies and the finance mechanism for Moc Bai EZ.
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New policies affecting investment attraction
Like at the Moc Bai EZ, trade activities at Tinh Bien border gate non-tariff area in An Giang province have also become quiet these days. Very few people visit the area these days.
Traders here complain that they are on the verge of bankruptcy. “We only made investment in the remote area because we thought we would enjoy the tax exemption,” a businessman said.
“Only tax incentives can encourage investors to open duty-free shops and make investment in infrastructure items here. Now with the new regulations, the investment projects in the border gate economic zone will be cancelled,” said Le Huu Trang, Deputy Head of the An Giang Border Gate EZ’s management board.
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