HCM City’s EPZs, IZs are aging, need to be eliminated

Nguyen Van Be, chairman of the HEPZA (HCM City Export Processing Zone and Industrial Park Authority) Business Association (HBA), said HCM City leads the country in attracting investment to EPZs and IZs. 

Phan Chanh Duong, former Deputy CEO of Tan Thuan EPZ, said the establishment of Tan Thuan EPZ 30 years ago was an unfamiliar model in Vietnam, especially as an import model.

“In principle, the success of the EPZ model was measured by the occupancy rate. But Vietnam’s success is more than that. Tan Thuan EPZ has ignited the establishment of more than 10 EPZs and IZs in HCM City and 300 IZs nationwide,” Duong said. 

However, there are many problems, related to land allocation, premises and urban infrastructure, which affect investment attraction in IZs and EPZs, experts said.

HCM City, for example, is working on a project to develop 620 hectares for IZs and EPZs. The project was initiated two years ago, but land has not been allocated. 

As for the IZs and EPZs built 30 years ago, the time left for use is 20 years. The city needs to extend the land use time by another 20 years. If so, the total duration of land use would be 70 years, within the time allowed by the law.

The HCM City Export Processing and Industrial Zones Authority (HEPZA) reported that by September 2022, IZs and EPZs in the city had attracted 1,674 projects with a total registered capital of US$12.33 billion, 45% of which is foreign capital.

IZs and EPZs lure US$260 million foreign capital a year, while their export value is US$7 billion on average. The IZs and EPZs pay VND22 trillion of taxes to the budget and create 281,000 jobs. 

Deputy Minister of Planning and Investment Tran Duy Dong said that shortcomings are exposed during the development of IZs and EPZs in HCM City. The quality and efficiency of investment attraction don’t satisfy requirements of in-depth development and further improvement of land use efficiency. 

The model of IZs and EPZs is innovated slowly. Connection and cooperation within the zones and among them are loose. The infrastructure in IZs is not synchronized and labor quality cannot satisfy requirements on investment structure transformation.  

HCM City’s Party Secretary Nen said in the last 30 years, IZs and EPZs have fulfilled their mission of attracting investment and creating jobs. In the new period, they need to shift to a new operation model based on innovations and science and technology.