HCM City to focus on attracting FDI into technology-based sectors

Update: 11:03 | 11/12/2020
Ho Chi Minh City will step up efforts to attract foreign direct investment by focusing on infrastructure and administrative procedures, with priority given to high-tech projects, a top city official has said.
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HCM City to focus on attracting FDI into technology-based sectors
A view of Swan Bay in HCM City. (Photo: Swan Bay)

Le Thanh Liem, Standing Vice Chairman of the municipal People’s Committee, said priority would be given to foreign investors in technology who have innovative and advanced management capabilities.

Vietnam, especially HCM City, remains appealing to foreign investors who are continuing to make a beeline to the southern economic hub despite the COVID-19 pandemic.

Hua Quoc Hung, head of the HCM City Export Processing and Industrial Zones Authority (Hepza), said Vietnam has done a good job in containing the outbreak, which has persuaded investors to move their production from abroad to the city, contributing to boosting production, creating more jobs, especially in the services, footwear, leather and textiles and garment industries.

The city is expected to receive a wave of investments post-pandemic when American, European and Japanese investors move their production lines to Vietnam.

Experts said to welcome them, the city should set standards for foreign investors, saying priority should be given to high-tech projects.

He proposed establishing specialised industrial parks and attracting more investment in the production of materials, especially those used in major industrial sectors.

Besides, it is important to set up zones for support industries using the State budget to regulate land lease prices and attract investors to sectors targeted by the city and the central governments.

He also recommended existing industrial parks should attract intensive investment for sustainable development.

They should prioritise businesses with cutting-edge technologies and high added value while improving export capacity, he said.

HCM City also plans to offer competitive land rents and other incentives at industrial parks (IPs) and export processing zones (EPZs), and earmark more lands for building infrastructure to attract investment, according to Hung.

The city would switch to newer models of IPs and EPZs to attract foreign investment, and ensure it has appropriate incentives during the transition process, he said.

There are 17 IPs and EPZs in the city, and they have an occupancy rate of 68 percent, he said.

But only 120ha of land is available there in 2021 compared to 500-600ha a year in the last five years.

The city has sought the Government’s approval for a 380ha IP in Bình Chánh District, a specialised one prioritising innovative start-ups and producers and distributors in new industries.

The city is expected to have 23 EPZs and IZs with a total of 5,797.62ha in future.

HCM City received 3.81 billion USD worth of FDI in the first 11 months of the year, a drop of 30.5 year-on-year, according to the city's Statistics Office. The city accounted for 14.4 percent of the country’s total FDI in the period.

It took the lead with 865 FDI projects, followed by Hanoi with 470 and Bac Ninh province with 136.

The Statistics Office attributed the drop in FDI to the fact that the pandemic is still unpredictable.

This year, HCM City authorities have approved 3,401 cases of capital contribution and share purchase involving 2.83 billion USD, down 28.3 percent and 13.6 percent.

Experts have warned that foreign investors complain that traffic infrastructure and administrative procedures have not improved much.

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(Source: VNA)