Foreign direct investment has contributed significantly to breakthroughs in socio-economic development for the southern province of Binh Duong, as it was revealed that targets for 2020 have already been smashed.
In the 2016-2020 period, the province has set a goal of attracting $7 billion in foreign direct investment. However, by this September over $9.7 billion had been attained.
According to Sung-Moo Hong, deputy general director of South Korea’s Kolon Group, a project to produce polyester yarn to reinforce materials for Kolon automobile tyres in Binh Duong with the registered investment capital of $220 million was put into operation just over a year ago. Hong explained that this was only the first phase of the project and with good business results achieved recently, Kolon will expand its capacity at the factory. Previously, Kolon signed an MoU with Binh Duong authorities on implementation of a scheme to manufacture automobile tyres and airbags with investment capital of up to $1 billion in an area of nearly 42 hectares in the same province.
Apart from Kolon Group, many other foreign-invested enterprises with projects in Binh Duong have accelerated the construction process to bring their factories into operation recently.
Among those are a factory which sterilises paper boxes with capital of $110 million from Sweden’s Tetra Pak, and a hi-tech electrical and electronic products factory from TECO Group of Taiwan, with the total investment of $50 million.
According to a report by Binh Duong People’s Committee, in the first nine months of 2019 there was $2.56 billion of additional FDI poured into the province, an increase of 83 per cent over the same period of last year and exceeding 82.9 per cent of the whole-year plan.
This result increases the number of foreign-invested projects in Binh Duong to 3,702, from 64 countries and territories with the total registered capital of nearly $34 billion, ranking third in attracting FDI after Ho Chi Minh City and Hanoi. This capital source is mainly poured into the fields of industrial production, and trade and services.
Other notable projects which have been given licenses since the beginning of the year with high investment capital include a $135 million initiative funded by Japanese group Sharp Manufacturing, two projects invested in by BW Industrial Development, which is a joint venture between Becamex IDC and the US’ Warburg Pincus, with the total investment capital of $106 million, and a $186 million venture invested in by Japan’s Nitto Denko.
To attract sustainable FDI, Binh Duong has implemented a renewal programme in order to attract more investment in the 2016-2020 period with the goal of attaining such capital from partners with strong economic potential and major economic corporations in the world.
The province has also strengthened calls to attract FDI in hi-tech fields which are less labour-intensive, more environmentally friendly, and which boast high added value. Focus was placed on attracting planned industrial zones and industrial clusters. The plan also provided specific figures to strive to lure $7 billion of FDI.
As per the report however, in the period from 2016 to September 2019, Binh Duong attracted 38 per cent more funding than the five-year plan originally laid out.
With nearly 75 per cent of total FDI in the field of industrial production, in the 2011-2016 period FDI contributed more than 67 per cent of the total industrial production value of the whole province, ensuring the economic structure of Binh Duong moved in the right direction, and that industry and services played the leading role. In 2018 alone, FDI contributed almost half of the total development investment capital and accounted for nearly a fifth of the total provincial budget revenue.
Foreign-invested enterprises have forged close connections with domestic counterparts, focusing on hi-tech industries and producing highly competitive products. As a result, it helped meet the need of supplying raw materials for domestic enterprises as well as creating a high trade surplus, contributing to the province’s trade surplus in 2018 which reached nearly $5 billion.
According to Binh Duong People’s Committee Chairman Tran Thanh Liem, to attract more FDI, the province will continue to focus on improving its investment environment, improving competitiveness and promoting support for the development of relevant enterprises in the province.
“Binh Duong commits to continue promoting administrative procedure reform, and focusing on developing high-quality services to meet the business production requirements of enterprises. Moreover, we will enhance all authorities and bodies to focus on ensuring political security, social order, and safety to help businesses,” said Liem.
Source: VIR – By: Quynh Chau