A ready-built factory in Dong Nai province. Construction of such factories and industrial parks anticipates FDI flowing into the country after the pandemic subsides (Photo courtesy of KTG Industrial) HCMCity (VNS/VNA) - This month ground was broken for Viet Phat IndustrialPark, one of the largest in the country, in Long An province.
Beingbuilt by TZICO Joint Stock Company and Vietnam Innovation Parks ManagementCorporation in Thu Thua district’s Tan Long commune, the 1,800 IP will includea 600ha urban area. All the required land has been acquired.
MinhDuc LA Investment and Development Corporation broke ground for the 195.79ha DucHoa II-SLICO Industrial Park in Duc Hoa district also in Long An.
Itwill be the third largest IP in a cluster of 13 in Duc Hoa III.
KTGIndustrial, the industrial development arm of Khai Toan Group, recently beganconstruction of a ready-built factory in Nhon Trach 3B Industrial Centre inDong Nai province.
The8ha facility is its second-generation ready-built factory, and combines factories,pre-built warehouses and technology 4.0 to enable digital convergence fortenants.
LongHau Corporation has built a 29.6ha high-tech factory for lease in Da Nang cityto serve the supporting and tech industries.
Accordingto enterprises, there is a lot of investment being made in industrial parks andfactories for lease to welcome a likely wave of FDI inflows after the pandemicsubsides.
DangTrong Duc, deputy general director of the KTG Group and sales developmentdirector of KTG Industrial, said, “Vietnam has made great strides in economicand industrial development in recent years and attracted a large number offoreign manufacturers.
“Thenumber of industrial parks in Vietnam increased five-fold between 2000 and2018. By the end of last year there were 338 IPs all with high occupancy rates:92 percent on average in the north and 80 percent in the south.”
Thecountry’s industrial real estate segment enjoys certain advantages, he said.
Freetrade agreements that the country has signed offer incentives in terms oftariff duties and trade to manufacturers based in Vietnam.
TheGovernment offers corporate income tax, VAT and import-export tax breaks, visawaiver and other incentives to attract more investors, he said.
Ithas also paid great attention to infrastructure to facilitate cargo transport,he added.
Hesaid with the cost of production in China continuing to rise, manymanufacturers based there have expedited their relocation to alternativelocations in Southeast Asia, including Vietnam.
TheCOVID-19 outbreak has accelerated the move out from China, he said.
DonLam, co-founder and CEO of investment fund VinaCapital, said a survey by HarrisPolling this month found that over 70 percent of Americans think US firmsshould scale back their manufacturing in China.
“Therehave also been an increasing number of articles in publications such as TheEconomist and Foreign Policy, as well as comments from notable investors likeMark Mobius and organisations like JETRO and AT Kearny predicting that Vietnamis set to benefit from an acceleration in the movement of manufacturing out ofChina.
“Forthese reasons, we believe that a wave of FDI inflows is inevitable after theCOVID-19 medical issue is resolved.”
TrangBui, head of markets at Jones Lang Lasalle (JLL) Vietnam, said thanks to itsproximity to China, Vietnam is one of the markets benefiting greatly from thetrend of companies looking to diversify their manufacturing portfolio outsideChina.
Vietnam’soutstanding record in containing the pandemic could strengthen foreigninvestors’ trust in the country, she said.
“TheCOVID-19 has had some impacts on FDI investment in Vietnam in the short termdue to travel restrictions. FDI inflows will recover soon after the pandemicsubsides, offering great opportunities in the industrial real estate segment.”
LeThanh, chairman and general director of TZICO Joint Stock Company, said: “Somebig investors from the Republic of Korea and Singapore have shown greatinterest in the Viet Phat Industrial Park.”
NguyenVan Ut, Vice Chairman of the Long An People’s Committee, said the project is asignificant development for the province to attract high-quality FDI amid thewave of investors shifting from China and increasingly setting their sights onSoutheast Asia.
Accordingto Stephen Wyatt, country head of JLL Vietnam, industrial park developersremained confident that demand for land will continue to grow andtherefore land prices are expected to increase in line with the long-termpotential of Vietnam’s industrial segment./.
VNA
