DEEP C – next destination for Taiwanese investment

09:00 | 25/07/2019

As Haiphong is emerging as a favourable investment hub for Taiwanese investors, DEEP C Industrial Zones sets out to embrace this rising investment wave with its industrial land and ready-built, built-to-suit factories. Hans Kerstens, head of sales & marketing at DEEP C Industrial Zones, told VIR’s Thanh Van about the recent wave of Taiwanese companies flocking to the northern port city and how DEEP C prepares to benefit from this trend.

What makes Haiphong a promising investment destination for Taiwanese companies?

deep c next destination for taiwanese investment
Hans Kerstens

The last few years has seen Haiphong’s phenomenal rise into one of the top economic performers among localities in Vietnam. The city has secured the first spot in Vietnam’s fastest-growing localities for three consecutive years so far, with its 2018 GDP growth rate hitting 16.27 per cent, more than double the national rate. The infrastructure boom, firm support from the central authorities, together with the province’s strategic geographical location are the major drivers that turn Haiphong into a hotspot for foreign investment, with Taiwan being one of the leading sources of funding. The cultural familiarity between Taiwan and Vietnam also counts as a reason.

Aiming to create a thriving ocean economy, Haiphong’s port infrastructure and expressway network have undergone a complete makeover. The new Lach Huyen Deep Seaport, together with the well-known Haiphong Port, supported by a synchronous highway network connecting the city to China and key neighbouring regions do not only improve regional linkages but also establish Haiphong as an international gateway and major industrial hub of Vietnam.

Adding to that, the constantly improving business climate and preferential treatment such as the tax incentives at Haiphong Economic Zone have paved the way for the stellar rise of Taiwanese investment.

At this rate, Haiphong still has a lot to offer. The city is rolling out the red carpet for companies to come and explore its potential. Current Taiwanese companies in DEEP C include Vinasanfu gas, Vinasanfu material, and Peisun Chemical, among others.

In the past, if companies wanted to set up operations, they would go for a land lease of about 50 years and build their own factories. Since then, the demand has become more sophisticated. More investors show interest in ready-built factories/warehouses and the built-to-suit concept for short-term lease, and consider this a safe way to enter the market.

How does DEEP C capitalise on the rising number of Taiwanese ­investors flocking to Vietnam?

Being adjacent to all mega-infrastructure of Haiphong is an absolute advantage in terms of logistics for us and tenants operating in our zones, ensuring cost efficiency and the speedy shipment of goods. We have been joining investment promotion activities in Taiwan to help companies understand the benefits in partnership with DEEP C. We have also been co-operating with local authorities to organise seminars on ­industrial manufacturing trends and the investment environment of Haiphong.Through these activities, we aim to extend our business network and increase our exposure to investors while exploring their demand. As a customer-oriented company, it is important for us to understand and foresee investors’ need and develop our industrial zones based on these insights.

What facilities and infrastructure ­elements is DEEP C planning to ­upgrade to accommodate more ­foreign manufacturers?

DEEP C has been steadily expanding its land bank to meet the rising demand and at the same time offering flexible solutions for investors to choose from, including ready-built factories and built-to-suit options.

Well-prepared industrial land, however, is only the first step, and DEEP C has gone into a lot of effort to construct reliable utilities and put in place supporting services.

We seek to focus and spend more on the things we are good at: underground electricity distribution system all over the cluster of five industrial zones, abundant supply of both water, power, and fast-responding firefighting system, as well as the latest technology in our in-house wastewater treatment plant.

Support and licensing services are to be elevated to catch up with the speed of utilities. The improvement is limitless and carried out on a daily basis.

With sustainable development in mind, DEEP C is shaping up to become a budding eco-industrial park where businesses can thrive without putting a burden on the environment. We are convinced that this initiative will help our tenants achieve their corporate social responsibility as well as environment preservation goals.

DEEP C is striving to become Vietnam’s first eco-industrial park. Could you share some of the company’s ­initiatives to reach this goal?

Transforming into an eco-industrial park has become DEEP C’s primary development target. We still have a long way to go with so much more to achieve and numerous initiatives to be rolled out. As of now, DEEP C is constructing the first road made from plastic waste in Vietnam in co-operation with the US’ Dow Chemicals. After a pilot one-kilometre road passes the tests of Vietnam Maritime University, more will be laid across our industrial complex. Urged by the mission to provide power in a stable and abundant way, DEEP C is building its own power grid with energy generated from rooftop and floating solar panel, wind, and waste-to-energy facilities. Power generation units can communicate with each other so all or only a few can operate at a time, depending on real time energy demand at the zones.

Extra energy will be stored in batteries used to power hybrid barges sailing on the Hanoi-Haiphong inland waterway. We are targeting to supply 50 per cent of tenant electricity demand from renewable energy by 2030.

With renewable energy components manufacturing being one of the most dynamic industries in DEEP C, we expect to receive more tenants to be our partners in roadmap toward sustainability.

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