HCMC more cautious about choosing FDI projects

HCMC has turned more careful in choosing foreign direct investment (FDI) projects so as to avoid those requiring much land and using outdated technologies which are detrimental to the environment, a city official told local media last week.

The city authorities even make more careful choices when it comes to projects registered in industrial parks (IP) and high-tech zones, said Su Ngoc Anh, director of the municipal Department of Planning and Investment.

“The city has recently faced a problem with a big FDI project whose investor requires nearly 200 hectares of land, which is a very large area,” he said.

Regarding the solution for attracting FDI projects in the future, Anh said IPs are preparing land lots to serve Japanese and South Korean investors who use advanced technologies but do not require large land lots. Such IPs are building multi-story facilities to cater to these investors.

The city is now home to 6,500 operational FDI projects with combined registered capital of nearly US$41 billion, many of which will expire in the next five to ten years. The city will screen all such projects, and allow them to expand their scales and extend their operational durations.

District-level authorities will also make lists of projects that they need to call for foreign investments.

Anh noted that foreign investors tend to change their business policies when investing in HCMC by switching from pouring investments in wholly-owned projects to establishing joint ventures, contributing capital or acquiring stakes in operational projects as the move allows them to save time and costs for clearing land and building workshops.

Total investment in the city in 2016 is estimated at VND310 trillion (US$13.68 billion), with 17% of it from foreign investors, 8% from the city’s budget, 11% from State-owned firms and the rest from local people, according to Anh’s department.

The data reflects the role of FDI in the city’s socio-economic development when its share in the total investment in the city’s economy has increased from 15% in 2010 to the current level.

This year, the city expects to attract 713 FDI projects worth a combined US$1.3 billion and sees 174 FDI projects raising their capital by US$465 million.

The city also has allowed 1,900 foreign investors to spend US$1.9 billion contributing capital and acquiring stakes in enterprises here.

In all, the city expects to lure an estimated US$3.7 billion of FDI capital this year.

Source: The Saigon Times