Foreign Direct Investment (FDI) projects in Dong Nai increases in quantity but the quality has not yet been improved.

The total investment capital of fresh and expanded projects is about 565.03 million US$ and is 51% higher than that of the same period last year. This exceeds the year target. Accordingly, it is estimated that Dong Nai province will surpass the target of attracting foreign investment in 2005 which is the two successive years Dong Nai fulfills its task since the outbreak of Asian economic crisis in last quarter of 1997.

* Dong Nai – promising destination for foreign investors   

Vo Van Mot (in the middle), chairman of Dong Nai People's Committee attended the opening ceremony of a  cattle-feed company in Ho Nai IZ.

With high growth of FDI in the first half of the year, Dong Nai remains the most attractive destination in Vietnam for foreign investors. During the period, the province attracted 56 new projects licensed with FDI capitals of US$ 336.172 million. Up to now, about 665 FDI projects were licensed with registered capitals of US$ 7.7 billion. Of which, US$ 5.67 billion was of 479 projects that have come into operation in Dong Nai’s industrial zones (IZs) and US$ 315.031 million invested in 54 projects being under construction. Foreign invested enterprises (FIEs) employed 213,366 people. In the other hand, Nhon Trach 6 industrial zone has just set up; this helped raising number of IZs in the province up 17. At present, Dong Nai attracted FDI from 28 countries and regions throughout the world.      

Most of the FIEs in Dong Nai are performing well and investors made considerable profits. Many investors plan to expanding business. Some of them asked permission for increasing investment with a combined value of US$ 320 million in the first half of 2005. Although falling behind target, the provincial export turnover increased by 29 per cent over the same period last year. During the period, total turnover in the FIEs reached US$ 2.5 billion. Taxes paid by foreign investors were VND 324 billion (excluded VAT on imports and taxes on exports).

Song May and Ho Nai industrial zones attracted more FDI, it is larger considered than ever before. Many foreign investors have come and run business in the whole area of Tam Phuoc industrial park, in areas of 20 hectares of Long Thanh industrial zone and 40 hectares of Nhon Trach industrial park. In addition, short leasehold land agreements in Dinh Quan industrial zone were signed between foreign investors and local authority. At this place, about 10 FDI projects were licensed. These are under construction.

* High growth in FDI but not reach expectations

Dong Nai attracted more 50 foreign investors in the first half of the year, it will continue to grow to record high in FDI regardless of lower

Dyeing line in Global Dyeing company Ltd. located in Long Thanh industrial park

number of foreign investors coming Dong Nai during the final half. The local authority is creating opportunities for inward foreign investment in high-tech sectors with its purpose of land rental reduction and avoiding workforce crisis. A serious labor shortage arose during 2004-2005. Because workforce demands of FIEs are growing, many investors had to go to rural areas, Southwest provinces and Northern regions for finding workforce supplies. Numbers of these supplies were inadequate to meet demands of employers. For these reason, the province should give incentive to attract FDI into high-tech sectors in order to increase labor force skills, not repeat workforce crisis. In addition, expansion of auxiliary industries will benefit to the local economy, create good opportunities for growing small and medium enterprises in Dong Nai. At the same time, foreign currency trading will be saved from lower imported raw materials.

Dong Nai will accelerate public administration reform, improve further investment environment in order to attract more FDI. The province will also pay more attention to build qualifying industrial zones following the model of clean, green and safety as well as maintain a stable workforce and create favorable conditions for foreign investors. These are importance factors which help Dong Nai ecouraging FDI throughout the world and becoming the most attractive destination for foreign investors.

(Source Dong Nai Newspaper)