VSIP - a specialist integrated township developer

What are the foundations for VSIP’s success?

Back in 1994, the late Prime Minister Vo Van Kiet and Singapore’s then Prime Minister Goh Chok Tong mooted the idea of a joint collaboration to promote co-operation at the government level. VSIP was officially launched in 1996. While it enjoys strong support from the two governments, it is commercially managed by state-owned enterprise Becamex Corporation and Singapore’s Sembcorp Industrial Parks.

Becamex brings to the joint venture a deep understanding of what Binh Duong province needs in terms of infrastructure in order for the province to develop. The Singaporean company brings its Singapore international system. Sembcorp also contributes expertise learnt from having developed other successful industrial parks in Indonesia and China. The joint venture partnership has worked very well together to manage the VSIP and in turn, help bring prosperity to the province.

Why should investors choose VSIP as their destination rather than other industrial parks?

In VSIP, our customers are very important. With 22 different nationalities and territories among our customers, VSIP works hard to understand their various needs. We are essentially managing an international business: providing essential services with the service support that is almost ‘a home away from home’ operating environment. At the end of the day, investors come to VSIP because things get done for them. We are very thankful of the strong support rendered by our VSIP Management Board from the provincial government.

Together with our customers from all parts of the world, we share a common concern for the environment. We believe in long term sustainable development. Our roads are lined with trees, there is proper management of our estate, we have sewage treatment plants, etc and these are all steps to contribute to Vietnam’s strive for environmental friendliness.

Can you elaborate on your plan to expand VSIP’s investment in Binh Duong and nationwide?

I mentioned earlier that VSIP aims to ensure sustainability. With the success of our first VSIP in Binh Duong, it became apparent that we cannot continue to develop industrial zones if the surrounding vicinity is not able to offer amenities to support people’s needs. With worsening traffic in Ho Chi Minh City, it is increasingly difficult for workers and employers to come to work.

They need accommodation close to the workplace. Furthermore, as more young Vietnamese executives are employed, they look forward to affordable accommodation with modern facilities. So VSIP is developing residential and commercial properties close to the industrial park. We call this an integrated township and industrial park concept. Our second VSIP in Binh Duong’s New City will offer this integrated concept on 2,045 hectares. Ninety-five per cent of its initial industrial phase of 345ha is already taken-up, so we will commence developing some residential land soon.

Our third VSIP in the northern Bac Ninh province is about 700ha, out of which 200ha are allocated for residential and commercial purposes. The first phase industrial area has 19 committed customers. We are preparing to handover some land to customers in the third quarter of this year. Our Bac Ninh project should be popular with young Vietnamese executives. It will take just 15 minutes from Hanoi when the new highway is completed, so really they do not have far to travel for work. Living in VSIP Bac Ninh can also be a reality as affordable residences will be available.

I think our fourth 1,600ha VSIP in Haiphong can potentially be our most exciting. It is also an integrated township development, but it has a truly advantageous geography being sited in a coastal city. We have four kilometres of waterfront interspersed with a long commercial corridor to create a modern and urban environment. Adjacent are the new art and convention centres, making this an appealing livable city within the larger Haiphong.

With the economic downturn going on, many investors want to suspend the expansion of operations and investment. But it is different with VSIP which still continues to expand investment in industrial parks and township. Why is this?

You are right that the economic downturn has affected many investors. Some of our customers have adopted caution in implementing new investments. However, VSIP remains very confident in Vietnam. We believe fundamentally Vietnam has much to offer and when the world economic situation improves, it will be amongst the first to benefit. VSIP has been in Vietnam since 1996. We have together with Vietnam navigated the difficult Asian financial crisis in the late 1990s. We believe Vietnam will again ride through this difficult period and emerge stronger. VSIP is here for the long haul.

For VSIP, the integrated township and industrial parks are long term developments that span 10 to 15 years. Our new projects in Binh Duong and Bac Ninh were only recently launched. We continue to prepare the land for infrastructure including roads. By the time the economy shows signs of recovery, we would have readied land for customers to take over immediately. In a way, the economic downturn has ‘bought us time’ for land preparation, so for VSIP, we take this opportunity to prepare ourselves.