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The province has lowered its target of attracting FDI in 2011 to $850 million from $1.5-$1.7 billion initially. Dong Nai Department of Industry and Trade director Bo Ngoc Thu tells VIR why.
Why was there a retrenchment in the province’s FDI attraction target for 2011?
The initial target of luring in $1.5-$1.7 billion in FDI in 2011 was rooted in business figures in 2010 between provincial management authorities and investors. Foreign firms came to Dong Nai searching business opportunities and voiced their investment intentions. In 2010, a number of Japanese business groups came to the province and made investment proposals. Most of them, however, were hit by the horrendous earthquake and tsunami in their home country in early 2011 so they had to concentrate on weathering the storm in their home country. Besides, firms face economic uncertainties. That was why we decided on lowering FDI attraction for this year to just $850 million.
Is the province in a position to achieve the revised target?
I believe the province could attract the remaining $387 million in remaining months of the year based on available figures from land lease contracts between industrial zones’ infrastructure firms and investors. Preliminary statistics show that until the year’s end, Dong Nai industrial zones will have five new licenced FDI projects, while other three projects seek more capital.
What are major hindrances to the province’s FDI attraction?
First, investment incentives for export processing zones and industrial zones’ enterprises no longer existed. Besides, state’s credit tightening policies have had big impacts on business operations. Industrial zones’ infrastructure firms are then short of capital for land acquisition and people’s resettlement. In this respect, the province proposed the State Bank to split real estate business into two types, non-production and production, thus enabling more businesses to get access to bank loans. But, there was no feedback.
Big foreign-invested urban property projects such as Waterfront City or Aqua City reportedly saw no progress or incurred slow pace of implementation though they were licenced long ago. Is that the case?
I want to confirm that these projects are in progress and the developers are loyal with their commitments. For instance, for Waterfront City project which was licenced in 2008, the developer is completing the detailed planning and is in the site clearance phase. Big projects incurring delays was mostly due to land acquisition woes.