Chu Lai zone told to boost infrastructure

Speaking at an online seminar held on 11 August 2013 in the central city of Da Nang, Huynh Khanh Toan, vice chairman of Quang Nam People’s Committee and Director of Chu Lai Open Economic Zone Authority said FDI projects in the zone were declining.

"There are many reasons for the decline, but lack of infrastructure is a fundamental factor," Toan said. "Besides investing in production-related projects, we should invest in resident-focused facilities for people working and living in the zone."

He said foreign businesses would hesitate to invest in the zone as it did not have international schools, hospitals, entertainment and other resident-focused facilities.

Planning and Investment Vice Minister Dang Huy Dong agreed, saying that an economic zone needed not only factories, but also accommodations for workers.

"However, we should think twice about how much to invest, because we should not plough lots of money into these projects and then just hope the investors come. It would be very risky," Dong said.

Pham Van Tai, vice director of Truong Hai Group, the country’s biggest truck maker and the largest investor in the zone, said convenient accommodation was a vital factor for attracting investors.

"Investors in HCM City, for example, would not invest here if the living standards were behind those in HCM City," Tai said.

However, Tai believed investment in accommodation should be carried out gradually following the actual demand of investors to avoid risks.

According to the Quang Nam People’s Committee, after 10 years of construction and development, the face of the first economic zone in Viet Nam has been gradually formed.

Investment projects in Chu Lai Open Economic Zone have significantly contributed to the overall development of Quang Nam Province, especially by generating key industrial products and increasing local budgets.

To date, Chu Lai Open Economic Zone houses a total of 85 investment projects with combined registered capital of US$1.5 billion. Of these, 56 projects valued at over $750 million are in operation.

Investment projects in the economic zone paid VND12.2 trillion to the local State Budget in the 2006-2012 period, accounting for 50.67 per cent of the province’s budgetary income.

In 2012, investment projects contributed VND3.3 trillion ($160 million) and accounted for 58.8 per cent of the province’s total budgetary revenue.