Needed: Putting industrial complexes in order

13:28 | 14/01/2017 Industry

(VEN) - The Ministry of Industry and Trade has submitted a decree on the management of industrial complexes (ICs) to the government for approval. This decree is expected to drive the management of ICs to framework.  

Disordered planning

More than 600 ICs were formed before the issue of IC management regulations following Prime Ministerial Decision 105/2009/QD-TTg. The planning, establishment, construction and investment of these ICs did not follow the close process.
Almost all districts and even communes agreed on the establishment of ICs, making provinces and cities difficult in redevelopment. Prior to its decision, Thanh Hoa Province planned 100 ICs with small scale. After two times of review, some 47 ICs were given out of the planning.

Quang Ninh Province brought 35 ICs out the planning. As a result, the province will have 13 ICs by 2020 and 19 ICs by 2030.
Massive development of ICs caused many implications. In particular, infrastructure and investment procedures were incomplete in the majority of ICs in many localities. There were only 66 ICs with complete wastewater treatment system in the country by 2015.

Uncontrolled development of ICs was attributed to mechanisms and policies, while legal documents were issued inconsistently. For example, according to regulations, ICs without infrastructure investors will establish IC development centers. However, there is no guidance for its establishment, while local budget remains limited. In addition, the mechanism is inappropriate that in some ICs, district people’s committees are both infrastructure investors and management agencies.

Phu Tho Department of Industry and Trade Director Nguyen Manh Hung said that management agencies did not know those to report when businesses come to invest in ICs. Moreover, departments of planning and investment are responsible for granting investment and business certificates, but post-investment management is implemented by departments of industry and trade.

According to Thanh Hoa Department of Industry and Trade Deputy Director Le Trong Han, the management of ICs following Decision 105/2009/QD-TTg is not specific. Departments of industry and trade are assigned to manage ICs, but many contents are not engaged.

Adding legal documents

Realizing the inadequacies in the management and development of ICs across the country, the Ministry of Industry and Trade and the Ministry of Planning and Investment issued Joint Circular 31/2012/TTLT-BCT-BKHDT guiding the settlement of ICs formed before the issue of IC management regulations following Prime Ministerial Decision 105/2009/QD-TTg.

Around 400 ICs were handled by provincial people’s committees under their authority or were asked to switch to industrial zones, while 83 ICs were changed to other purposes or withdrawn from the planning. However 20 among 63 provinces and cities did not complete their tasks by December 31, 2015. To overcome difficulties for localities, the Ministry of Industry and Trade proposed a deadline on December 31, 2017.

This decree would grant many development incentives to ICs development. Preferential policies will be applied to ICs in areas with difficult socioeconomic conditions. Workers working in ICs will enjoy a 50-percent reduction in personal income tax to be paid within 15 years and a 50-percent exemption in personal income tax for annual bonuses. Investment projects to build technical infrastructure will be subject to a maximum loan of 70 percent from preferential credit of the state, land lease for no more than 70 years and capital raising under the form of public-private partnerships.

State budget will support IC development activities, including conducting surveys in businesses and manufacturing bases wishing to invest in ICs; forming detailed planning and investment projects to build technical infrastructure; evaluating development mechanisms and policies and learning experience about IC development at home and abroad; and organizing promotion activities to attract more investment in ICs.

The decree also stipulates in detail the planning, establishment and expansion of ICs. In addition, withdrawal from the planning must be done according to strict orders.

The Ministry of Industry and Trade is responsible to chair and coordinate with ministries, departments and localities to promulgate or propose to issue legal documents, mechanisms and policies, and organize professional training for state management officers on IC development; develop and submit support programs and the list of ICs raising capital under the form of public-private partnerships on building technical infrastructure in ICs to the government for approval.

Organizing periodical or irregular inspection on the implementation of mechanisms and policies of the state on IC development and assessing the effectiveness of investment in building technical infrastructure in ICs are needed.

Viet Nga