IZs and EPZs are built to play a strategic role in the development of the local economy. 

However, due to unfavorable land conditions, poor transport infrastructure connections and high agricultural land prices, it is difficult to build new and expand existing IZs and EPZs. HCMC reserved a land fund of 8,900 hectares for IZ and EPZ development, but only 50 percent of the fund has been used so far.

HCMC Party Committee’s Secretary Nguyen Thien Nhan commented that the land fund has not been used up even though it is very modest.  

Since 2007, IZs and EPZs in HCMC have been told to focus on attracting investments in production fields with high intellectual content, high technology and high competitiveness. However, the result is still far below the expectations with very few projects of this kind.

Fewer than 10 enterprises in IZs and EPZs have certificates for high-tech enterprises, while the high-tech proportion in the zones is low at 10 percent.

The problem, according to analysts, is that most IZs are designed to develop as general IZs, while infrastructure development companies try to attract as many investors as possible to collect land rent, while they have not been choosy in selecting investors.

Most IZs are designed to develop as general IZs, while infrastructure development companies try to attract as many investors as possible to collect land rent, while they have not been choosy in selecting investors.

In reply, infrastructure developers said they really wanted to attract investments in the four key industries and supporting industries as requested by municipal authorities, but they need support to do this. 

Local authorities need to apply policies to encourage investors to renovate production lines and technologies to improve production value and competitiveness.

There are only two EPZs in Vietnam, Tan Thuan and Linh Trung in HCMC, and 320 IZs.

According to Phan Chanh Duong, former general director of Tan Thuan EPZ, Vietnam decided to set up an EPZ years ago because they were the most reasonable model at that time. The enterprises in EPZ were not allowed to buy materials from Vietnam and all of their products must be exported.

Duong said the EPZs had fulfilled their tasks after a long period of operation and now is the time for HCMC authorities to set up a new development strategy for the future. Tan Thuan EPZ in district 7, for example, needs changes in use. 

He suggested turning Tan Thuan EPZ, which is now in the inner city, into a financial and trade service center. In China, the former Shenzhen EPZ became the city of Shenzhen.

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