Vietnam's IZs expand in anticipation of new FDI wave

Developing IZs is seen as a profitable business at this time as many foreign investors are leaving China and heading for Vietnam.

Since the establishment of the first IZ, covering an area of 153 hectares in Hai Phong, developed by a Japanese investor, Vietnam now has 335 IZs as of March, with total area of 97,800 hectares.

Vietnam's IZs expand in anticipation of new FDI wave



Of these, 260 IZs have become operational with the total natural area of 68,700 hectares, and the other 75 IZs are under construction. The occupancy rate of the operational IZs is 75.7 percent.

The development of IZs has become strong in recent months in the context of the US-China trade war and the wave of relocating production bases out of China.

In the first three months of 2020 alone, 5 new IZs were set up with the total area of 800 hectares. Meanwhile, in the year 2019, only four IZs were established. The occupancy rate has also increased by 1.5 percent to 75.7 percent in the first three months of the year.

Many IZs which were left idle in the past, have been revived in anticipation of the new FDI wave. The 46 hectare Viet Hoa – Kenmark IZ in Hai Duong is an example.

It was registered by a Taiwanese investor. However, the investor disappeared after three years of construction. Later, it was sold to An Phat Plastics and Green Environment, which built the IZ and made it ready to receive investors.

It was registered by a Taiwanese investor. However, the investor disappeared after three years of construction. Later, it was sold to An Phat Plastics and Green Environment, which built the IZ and made it ready to receive investors.

 

A representative of Sao Do Group, the investor of Nam Dinh Vu IZ, revealed that he has received many investors who have come to learn about investment opportunities. One of them is SK E&C, belonging to SK, one of the South Korean biggest groups.

Prior to that, SK had poured $1.5 billion into the projects in Vietnam and said it will expand business in Vietnam.

As too many IZs have arisen simultaneously, the Ministry of Planning and Investment (MPI) warned that this would have serious impact on socio-economic development and adverse effects the environment.

The ministry said in order to receive the new FDI wave, Vietnam needs to have a ‘conductor’ who programs the development of IZs so as to obtain the optimal benefits.

Nguyen Van Toan, deputy chair of the Vietnam Foreign-invested Enterprises (VAFIEs), pointed out that the weak point of Vietnam’s IZs lies in the poor infrastructure. In many IZs, the developers have just levelled the ground and are awaiting investors. In some IZs, there is no road to transport goods.

“Don’t let investors develop IZs spontaneously. It is necessary to program IZ development,” Toan said. “IZs not only sell the right to lease land, but also provide associated services." 

Kim Chi

Transfer pricing among FDI firms in Vietnam at alarming rate: State Audit

Transfer pricing among FDI firms in Vietnam at alarming rate: State Audit

While FDI firms continue to report losses, they keep expanding operations in the country.

FDI is important for VN's real estate market recovery

FDI is important for VN's real estate market recovery

Foreign direct investment (FDI), which will help the economy recover after Covid-19, is also a driving force for the recovery of the real estate market.

 
 

Other News

.
EVFTA hoped to help with sustainable poverty reduction in Vietnam
EVFTA hoped to help with sustainable poverty reduction in Vietnam
BUSINESSicon  05/08/2020 

The EU-Vietnam Free Trade Agreement (EVFTA), which came into force on August 1, is hoped to create a driving force to help Vietnam reap further achievements in poverty reduction and economic growth.

Analysts: High-end hotels hold appeal among investors
Analysts: High-end hotels hold appeal among investors
BUSINESSicon  05/08/2020 

Analysts from real estate consultant Jones Lang LaSalle have said domestic and foreign investors alike are actively seeking to purchase high-end hotels in downtown areas, mostly due to limited land supply.

Wooden plank exporters struggle with higher tax rates
Wooden plank exporters struggle with higher tax rates
BUSINESSicon  04/08/2020 

The Vietnam Timber and Forest Product Association has sent an urgent petition to the Ministry of Finance, Ministry of Agriculture and Rural Development and Ministry of Industry and Trade about congestion of wooden planks

E-wallet firms battle for slice of cashless payment pie
E-wallet firms battle for slice of cashless payment pie
BUSINESSicon  04/08/2020 

E-wallets firms are battling for a piece of the cashless payment market amid rapid growth in the context of the COVID-19 pandemic.

Corporate income tax reduction comes into effect
Corporate income tax reduction comes into effect
BUSINESSicon  04/08/2020 

Resolution 116/2020/QH14 granting a reduction of 30 per cent on corporate income tax (CIT) for eligible enterprises officially came into effect on Monday.

Big rearers win big
Big rearers win big
BUSINESSicon  04/08/2020 

Many animal husbandry enterprises are leveraging the pork supply shortage to sell at high prices, earning huge profits

VN businesses slow in preparing to enjoy preferential tariffs in EVFTA
VN businesses slow in preparing to enjoy preferential tariffs in EVFTA
BUSINESSicon  04/08/2020 

 Experts have raised concerns that Vietnamese businesses are slow in preparing conditions to enjoy preferential tariffs in the Viet Nam-EU Free Trade Agreement (EVFTA).

Probe into Tenma Vietnam’s alleged bribery underway: police official
Probe into Tenma Vietnam’s alleged bribery underway: police official
BUSINESSicon  04/08/2020 

The investigation into the Japanese-invested Tenma Vietnam company’s allegation of bribing civil servants and tax and customs officers of northern Bac Ninh province is still ongoing, according to a police official.

VN textile, electronics hardest hit in pandemic: official
VN textile, electronics hardest hit in pandemic: official
BUSINESSicon  04/08/2020 

Textile and electronics have been the two export-oriented sectors mostly impacted by the COVID-19 pandemic, an official has said.

Vietnam’s small companies look to the US market
Vietnam’s small companies look to the US market
BUSINESSicon  05/08/2020 

The US is an important export market targeted not only by large Vietnamese corporations but also small enterprises.

How can VN night-time economy develop?
How can VN night-time economy develop?
BUSINESSicon  05/08/2020 

Food and Music of An Bang Sea, a night event organized on An Bang Beach in Hoi An City in Quang Nam province last weekend, attracted many visitors.

Local F&B shops struggle to survive new COVID-19 outbreak
Local F&B shops struggle to survive new COVID-19 outbreak
BUSINESSicon  05/08/2020 

Eatery and beverage shops learned from experiences from the April lockdown and have prepared for the new difficult period.

Businesses in HCM City's central business districts are idle as demand is weak
Businesses in HCM City's central business districts are idle as demand is weak
BUSINESSicon  05/08/2020 

Many streetfront buildings in large cities that house shops that were busy in the past are idle because business activities have declined due to Covid-19.

Vietnam prepares to receive investors from Japan, the US, EU
Vietnam prepares to receive investors from Japan, the US, EU
BUSINESSicon  04/08/2020 

Japanese businesses have begun relocating factories to Vietnam, and it is expected that American and European businesses will also come soon.

VN Civil Aviation Authority's plans for new Quang Tri Airport face opposition
VN Civil Aviation Authority's plans for new Quang Tri Airport face opposition
BUSINESSicon  04/08/2020 

The Civil Aviation Authority of Vietnam (CAAV) plans to build Quang Tri Airport in Quang Tri province, but experts disagree with the idea.

Vietnam factory activity dips in July as Covid-19 impacts grow
Vietnam factory activity dips in July as Covid-19 impacts grow
BUSINESSicon  03/08/2020 

Despite a drop in output in July, firms remained confident in the 12-month outlook for production.

Enticing legal changes lure in foreign investors
Enticing legal changes lure in foreign investors
BUSINESSicon  04/08/2020 

Foreign investors are making new investments moves into Vietnam on the back of supporting policies and new rules. However, as some legal concerns remain, the development of the next steps still requires some preparation. 

Summary of new points of amended Law on Investment 2020
Summary of new points of amended Law on Investment 2020
BUSINESSicon  03/08/2020 

After more than six years in effect, the Law on Investment has been officially amended with a number of new articles to improve the country’s appeal to higher-quality foreign investment flows.

Outlining the preferential mechanisms for new PPP projects
Outlining the preferential mechanisms for new PPP projects
BUSINESSicon  04/08/2020 

Public-private investment projects play a significant role in developing infrastructure and have the potential to accelerate large-scale construction works across the country.

Vietnam economic outlook remains positive despite Covid-19 resurgence: HSBC
Vietnam economic outlook remains positive despite Covid-19 resurgence: HSBC
BUSINESSicon  03/08/2020 

HSBC economists forecast GDP expansion of 3% in 2020 for Vietnam, the only ASEAN country they expect to have positive growth this year.

 
 
 
Leave your comment on an article

OR QUICK LOGIN