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“EZ, hi-tech zone syndrome” impoverishes the country

 VietNamNet Bridge – Vietnam is facing the oversupply of high technology zones and economic zones (EZs).

VietNamNet Bridge – Vietnam is facing the oversupply of high technology zones and economic zones (EZs).

Commenting about the establishment of EZs and high technology zones, Ha Sy Dong, Head of the Quang Tri provincial Head of the Economic Zone Management Board, noted this is a “syndrome,” while Phung Quoc Hien, Chair of the National Assembly’s Finance and Budget Committee used the word “mushroom.”

EZs put heavy burden on state budget


According to Thoi bao Kinh te Vietnam, Vietnam plans to set up 18 economic zones nationwide which covers a land and sea surface area of 730,553 hectares.

It is obvious that Vietnam would need a huge sum of money to build up and put the EZs into operation.

Analysts said the infrastructure items of the EZs alone would “gobble up” trillions of dong of the state budget every year.

In 2010, for example, according to the Ministry of Planning and Investment, the state budget had to spend VND11.361 trillion to support the construction of the infrastructure system in the EZs.

Besides the capital from the state budget, the EZs have also been attracting trillions of dong worth of capital from other sources. By the end of 2010, the total investment capital injected in technical infrastructure items in EZs had reached VND170 trillion.

The 15 established EZs now cover an area of 662,249 hectares, while the figure is expected to increase in the future. Some local authorities plan to attract VND40 billion worth of investment capital per hectare in the EZs. However, experts have pointed out that this is an impossible mission in the context of the economic downturn and the budget tightening.

The establishment of EZs in masses, according to experts, has threatened the state budget balancing. A lot of EZs are meeting big difficulties in developing the infrastructure with high quality to attract investors.

The EZ syndrome

Dong has every reason to call the establishment of a series of EZs recently a “syndrome.”

In fact, there are a lot of “syndromes” in Vietnam, including the “oil refinery syndrome,” which is very hot on all economic forums.

“There is no oil in many localities, but the licenses to build oil refineries still have been granted to the localities. This is called a “syndrome,”” Dong said.

The Ministry of Construction, when answering the inquiry of Phung Duc Tien, a National Assembly’s Deputy from Ha Nam province, also admitted that there are too many EZs in Vietnam, which has led to the waste of land and resources.

Technology zones turn into “grass zones”

The Hoa Lac High-technology Zone in Hanoi and the Da Nang High-tech zone in Da Nang City, described as the rendezvous for high-technology enterprises, have still been deserted.

Hoa Lac zone, designed as a national science city, was expected to gather 100,000 scientists, students, engineers and skilful technicians to work at the most modern laboratories, research institutes and universities in Vietnam, has only attracted very few investors since 1998.

As such, the “technology” zone now remains the “grass zone,” where grass develops strongly on the idle land.

The Da Nang High Technology Zone, capitalized at VND9 billion, needs VND3.5 trillion in the first phase of the project. However, only VND300 billion has been disbursed so far, or only 10 percent of the capital needed for 2012-2015.

Dat Viet


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