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Vietnam will have a special economic-administrative area

vietnam will have a special economic-administrative area

Over 20 years of construction and development, the model of economy and industrial zones are now limited, compared with the development demand of Vietnam; therefore, a new model with outstanding dominance is really needed to attract investment. To meet this demand, the government is researching the project of the special economic-Administrative Law.

According to the Ministry of Planning and Investment, the whole country is now applying some area models such as industrial zone, export production zone, hi-tech zone, economic zone, concentrated information technology zone and hi-tech applied agricultural zone to attract investment.

These zones have contributed to economy development through renewing the investment and business environment, which attracts a large amount of investment to the infrastructure of technique and business-production, promoting industrial production and forming some key industrial majors.

As data shown, until June, 2017, there are 325 industrial zones formed with the natural area of 94.9 thousand hectares, in which industrial areas being able to rent reach 64 thousand hectares, making up 67 % the total natural area of industrial zones

In which, 220 industrial zones with the natural area of 60.9 thousand hectares have been active and 105 industrial zones have been in the period of land clearance and a natural area of 34 thousand hectares have been built. The ratio of industrial zones being filled gains 51.5 %. The ratio of the active industrial zones being filled gains 73%.

About economy zone, the number of coastal Economy Zones founded in the whole country is 16 with total surface and water area approximately 815 thousand hectares. Besides, there are two economic zones (Thai Binh Coastal economic zone, Thai Binh Province and Ninh Co economic zone, Nam Dinh Province) zones but they have not formed.

In 16 coastal economic zones, there are 36 industrial zones, a non-tariff  area is established with the total area of 16.1 thousand hectares, in which industrial areas being able to rent reach 7.8 thousand hectares, making up 48 % the total natural area of industrial zones.

The economic and industrial zones attract 473 newly-registered foreign investment projects and increase the investment of nearly 7.3 billion USD; 385 domestic investment projects and increase the investment for over 139 projects with the new investment, increasing by 111,000 billion VND.

According to the Ministry of Investment and Planning, the model of Vietnam’s economic and industrial areas aim to develop different majors and areas but their competitive preference is built on the rule of promoting the favorable conditions about scale, forming the concentrated production areas with the tight relation between manufacture factories to produce products and services low-costed but high-competitive.

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However, attracting investment through the models of economic and industrial zones has revealed many disadvantages, which is difficult to attract qualified investment. According to the Ministry of Investment and Planning, the reason is that the local governments haven’t promoted the pioneer role to reform the administration “one door in place”. Preference for these zones is concerned but not attractive; the investment mobilization to develop infrastructure encounter difficulty; the economic link in developing  the models of economic and industrial zones is unclear and ineffective. “To further promote the role of the models of economic and industrial zones in the socio-economic development  and ensure that the models of economic and industrial zones will work, it is necessary to find out the models of economic and industrial zones with extra favor and attraction, fixing the defects of the old ones”, the Ministry of Investment and Planning claimed.

From international experience and the conclusion of the economic district, administrative district and free economic zones and other similar models built and developed in 13 countries  and regions  in the world, the Board of Editor of economic –administrative Project of Law said, the models of new investment attraction can be divided into 3 levels with different institutions and policy.

In which, level 3 is the highest, with independent administrative-economic institution system, different from other areas in the country. The organization, mechanism, policy proposed by provinces applied for 3 special economic-administrative units are deployed

in Van Don, Bac Van Phong and Phu Quoc equivalent to level 1.

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The Board of Editor said, the special model of administrative-economic units predicted to be built in Vietnam is the combination of Chinese economic district model and the model of economic, administrative district in Korea. They can be considered as a synthetic socio-economic zone, in which, a characteristic frame about administrative and economic management is applied to demand the national aim of social, politic, economic development to attract investment and develop social economy.

This model is being proposed and how large it will be is unknown; however, the proposing Board said, to promote this model, countries apply a diversified characteristic socio-economic mechanism such as state budget support, exemption, land renting fee,  land renting time, infrastructure renting, visa exemption, business-registered policy, tariff, favorable tax… Besides, the Boards of the management of economic district are delegated to the aim “one door in place”.

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