14:37 | 02/02/2017 Economy- Society
(VEN) - Prime Minister Nguyen Xuan Phuc has recently given approval to double the Lao Cai Border Crossing Economic Zone (BCEZ), from 7,900ha to 15,900ha, to meet new development requirements and boost cross-border trade with China and beyond.
The establishment of the Lao Cai BCEZ in 1998 was designed to implement the policy adopted by the Vietnamese Communist Party and the State of taking advantage of border areas to boost economic development and trade. Initially, this economic zone was planned to cover more than 5,000ha. In 2008, its area was expanded to 7,900ha, aiming to develop the Lao Cai BCEZ into a dynamic trade and service center, promoting the exchange of goods and services between Vietnam and the southwestern part of China, as well as cross-border trade and economic cooperation with countries in the Greater Mekong Sub-region (GMS).
By the end of 2016, there were 279 investment projects in the zone with total registered capital of more than US$1.02 billion, including 15 foreign direct investment (FDI) projects with combined registered capital of over US$50 million, equivalent to 10 percent of total FDI in Lao Cai Province, and more than 1,870 business offices. The economic zone has created major impetus for the restructuring of the provincial economy, increasing local incomes and employment, ensuring border security, strengthening the friendship and cooperation between Vietnam and China.
Currently, industry, agriculture, forestry, trade and services are major pillars of the Lao Cai economy. Most of the province’s industrial, trading and service facilities are based in the Lao Cai BCEZ, creating 60-70 percent of total production value. In the 2010-2015 period, Lao Cai’s gross domestic product (GDP) grew more than 13 percent annually, while the Lao Cai BCEZ achieved a nearly three percent higher growth of 16 percent. The economic zone has significantly contributed to restructuring the provincial GDP, gradually reducing the percentage of agriculture and forestry while increasing the share of industry, trade and services.
The import and export value created by the Lao Cai BCEZ has grown continuously, from US$435 million in 2008 to US$2.15 billion in 2015, and stood at an estimated US$1.94 billion in 2016. In recent years, an average 1.7 million people and more than 100,000 automobiles crossed through the Lao Cai Border Crossing annually.
Annual retail sales of goods and revenue from consumer services in the Lao Cai BCEZ totaled about VND9 trillion in 2015 and 2016, 4.5 times higher compared with 2010. The provincial budget’s revenue from import and export activities almost tripled from VND470.6 billion in 2008 to nearly VND1.37 trillion in 2015 and remained at this level in 2016, accounting for 30-35 percent of the total. Currently, the Lao Cai BCEZ ranks third nationwide, behind the Lang Son and Quang Ninh BCEZs, in growth efficiency and growth rate. Adequate infrastructure, including water supply and drainage systems, lighting and telecommunications facilities, markets, hotels, restaurants, supermarkets, storage facilities, parking lots, office buildings, and transport facilities, allow the Lao Cai BCEZ to meet investor demand.
The transportation system connecting Lao Cai with other Vietnamese localities and with southwestern China and other ASEAN countries has been upgraded. The Hanoi-Lao Cai rail route, the Noi Bai-Lao Cai Highway that has been connected to the Kunming-Ha Khau Highway, and the Hanoi-Hai Phong Highway, have facilitated the transportation of goods to and from Lao Cai Province.
The plan to expand the Lao Cai BCEZ is focused on developing border areas from the city of Lao Cai to Bat Xat District to promote investment and trade. According to the provincial leadership, the infrastructure of the Lao Cai BCEZ will be supplemented with logistics systems, inland container depots, industrial complexes and entertainment facilities. Cross-border economic zones will be formed to attract investment and develop processing, packaging, financial, transport and tourism services.
Lao Cai Province is drawing up a master plan and a detailed plan for the development of the expanded Lao Cai BCEZ. The Chinese side is concentrating resources on tapping the potential of the southwestern region, including Yunnan Province. The Lao Cai BCEZ is expected to undergo major changes in coming years.