Coastal economic zones remain ailing

Coastal economic zones have been established continuously in recent years, because they are believed to help attract investors, thus helping develop local economies. However, the achievements gained by the zones remain far below the expectations.

The coastal economic zones cover 730,000 hectares of land and water surface. However, only 10 percent of the zones have been occupied. It is now clear after nine years that the coastal economic zones have been developing too slowly in comparison with the great potentials and advantages.

The report released by the Ministry of Planning and Investment MPI late last week at the workshop held in Quang Nam province, discussing the policies to develop coastal economic zones in Vietnam, showed that after nine years of development, Vietnam now has 18 coastal economic zones, including 15 built zones and three under implementation.

The economic zones have attracted 130 foreign invested projects with the total investment capital of 25 billion dollars, about 650 domestic invested projects, totaling 537 trillion dong.

Economists say that only the Dung Quat Economic Zone in the central province of Quang Ngai, with the Dung Quat oil refinery being the “nucleus” of the zone; can fulfill its role as the driving force for the local economy development. Meanwhile, other zones keep going slowly with large unoccupied areas and high number of pending projects.

However, even Dung Quat has also witnessed the slowdown in development, as it still has not found the new way to follow. Le Van Dung, Deputy Head of the Dung Quat Economic Zone Management Board, has admitted that over the last two years, the signs of development slowdown have appeared. A lot of big projects capitalized at hundreds of millions of dollars have been delayed due to financial difficulties and the problems in site clearance.

The underground petroleum depot project, which was licensed in 2010, capitalized at 340 million dollars, for example, has not been implemented yet. The Quang Lien steel project capitalized at 4.7 billion dollars has also been delayed for many years due to financial difficulties.

To date, Dung Quat has attracted 112 investment projects with the total registered capital of up to 8.3 billion dollars. However, the actual implemented capital has reached 4.9 billion dollars only.

Other economic zones, including the Chu Lai open economic zone in Quang Nam province, Nghi Son in Thanh Hoa, Vung Ang in Ha Tinh, are also facing the same difficulties. Some mammoth projects worth several billions of dollars have not been implemented yet.

The Chu Lai Open economic zone, the first sea-borne economic zone in Vietnam, which was established in 2003, has attracted 66 projects only with the total registered capital of 1.7 billion dollars. The problem is that of the projects, only 45 ones, capitalized at 600 million dollars, have been operational, and most of the projects are domestic invested ones.

Head of the Vietnam Economics Institute, Tran Dinh Thien, has expressed his worry about the low efficiency of the economic zones. “The coastal economic zones, which have been set up in a massive scale in the last few years have caused the so called “investment dilution”, the lack of strength concentration and the stiff competition among localities to scramble for investors,” Thien said.

Vu Dai Thang, Director of the Economic Zone Management Department of the Ministry of Planning and Investment, also said that the economic zone establishment has not been put in the harmonization with the national interests.

Thang went on to say that some established zones could not meet the basic requirements to develop effectively: they do not have key projects, deep water ports or airports.

MPI has been urged to build up concrete standards which serve as the basis to assess the operation of the economic zones. Concentrated invested will be made only in the zones which can create breakthrough to help develop local economies, while underdeveloped zones may have the licenses revoked.

Source: VnExpress

Tags: Vietnam economic zones