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Removing legal barriers for eco-industrial park development

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By 2030, 40-50 per cent of localities will have plans to convert existing industrial parks into eco-industrial parks, while 8-10 per cent of localities are determined to build new eco-industrial parks to attract investment.

According to data from the Ministry of Planning and Investment, by the end of 2023, the country had 416 industrial parks established, including four export processing zones, with a total natural land area of ​​about 129,900 hectares and a total industrial land area of ​​about 89,200 hectares.

Up to now, the system of industrial parks has been present in 61 out of 63 provinces and cities nationwide, becoming a key area attracting domestic and foreign investment projects and a destination for many leading world corporations.

In the new development trend, economic organisation models by territory are changing in development goals, and Vietnam is no exception.

At the same time, towards sustainable development, the requirement to build green industrial parks and convert existing industrial parks into ecological industrial parks is becoming an urgent need to adapt to development requirements.

An assessment report by the Ministry of Planning and Investment shows that in over 30 years of forming and developing industrial zones in Vietnam, up to now, the development of industrial zones in width is facing difficulties due to the limited resources of labour, land, and resources. Labour productivity and resource exploitation efficiency are low, not ensuring harmony between economic development, environmental protection and social security.

This process also faces difficulties as tax and land incentives are gradually decreasing. The linkage and cooperation in industrial production in industrial zones and economic zones are still limited.

According to the plan, by 2030, 40-50 per cent of localities will have plans to convert existing industrial parks into eco-industrial parks, while 8-10 per cent of localities are determined to build new eco-industrial parks to attract investment.

A survey by the Institute for International Investment Studies (ISC) shows that the demand for attracting investment capital to fill the remaining area of ​​Vietnam’s planned industrial parks is about 600-650 billion USD. The total investment capital for infrastructure development and filling industrial parks is about 650-700 billion USD.

In addition, the demand for investment capital for technological innovation in enterprises in industrial parks and restructuring and converting 293 existing industrial parks into ecological industrial parks, to realise the green growth target according to the commitment of the Vietnamese Government to the international community, is also very great.

According to the Vietnam Industrial Park Finance Association, the implementation time of an industrial park infrastructure investment project can last more than three years, even five years, because of many difficulties and obstacles in the legal framework and site clearance, especially investment in the model of new industrial parks and ecological industrial parks.

Dr Ngo Cong Thanh, Vice Chairman of the Vietnam Industrial Park Finance Association, said that attracting investment to develop economic zones and industrial parks is showing limitations that must be overcome.

The planning and development orientation of industrial parks and economic zones still lacks a comprehensive vision and long-term perspective. They are still spread out across administrative boundaries, lack industry and regional linkages, and the quality and efficiency of investment attraction have not met the requirements for in-depth development.

In addition, localities and investors developing infrastructure for domestic industrial parks still prioritise attracting investment to fill in, not paying attention to the industry structure, technology, and environmental and social factors of investment projects, so the efficiency of investment in developing industrial parks has not met the requirements.

On the other hand, due to limited financial capacity, investors in industrial park infrastructure still have the mentality of waiting to find secondary investors before investing in shared infrastructure in the industrial park while foreign investors want to have land and technical infrastructure immediately before deciding to invest. This is one of the reasons why many industrial parks have low occupancy rates.

To mobilise large capital sources for investment in industrial parks and economic zones in the coming time, Dr Ngo Cong Thanh said there should be fundamental changes in attracting capital flows, creating conditions for investors to easily access production factors and innovate investment promotion activities.

In addition, legal issues regarding the formation and development of ecological industrial parks, and converting existing industrial parks into ecological industrial parks, need to be legalised or specifically guided, encouraging investors to participate in developing industrial park infrastructure.

Every year, the amount of foreign direct investment (FDI) in industrial parks and economic zones accounts for 60-70% of the FDI capital attracted nationwide, and this rate is still on the rise. This shows that industrial parks play a very important role in foreign investment cooperation activities in Vietnam. The trend of foreign investment in Vietnam in the coming time will focus mainly on industrial parks and economic zones.

Dr Phan Huu Thang, Chairman of the Vietnam Industrial Park Finance Association

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Ensuring water security in economic zones and industrial parks

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In recent years, the key economic region of the central region has developed rapidly and achieved many outstanding results. Multi-sector and multi-sector economic zones and industrial parks, with a focus on industrial and service development, have created many breakthroughs for the socio-economy in the central coastal provinces.

Along with the development of infrastructure in economic zones and industrial parks, the issue of water security is of concern to localities because the demand for water resources for industry is a challenge that needs to be solved in conjunction with appropriate policies and solutions.

The central coastal provinces of Quang Nam, Quang Ngai, Binh Dinh and Khanh Hoa have 28 economic zones and industrial parks, spanning more than 16,880 hectares, attracting nearly 1,200 projects, with a total investment capital of over VND 623,800 billion, equivalent to 25.35 billion USD. The economic zones of Van Phong, Dung Quat, Chu Lai, and Nhon Hoi, along with many other industrial parks, are the driving force for the strong economic development of the region.

Water demand in industry and services increases

In recent years, the demand for water in industrial production, business and services has increased sharply in the central provinces. In addition, the requirements for sufficient and stable water sources for production, business, and water quality are also of greater concern to investors and enterprises. Currently, the total water demand for industrial production in the provinces of Quang Nam, Quang Ngai, Binh Dinh and Khanh Hoa is about 194 million cubic meters per year. The key economic zone focuses on many heavy industrial projects such as steel, mechanics, automobiles, petrochemicals, seaport services, industrial urban areas, etc., so the demand for water has been increasing by 20-30% in each phase of investment attraction.

In Quang Ngai Province, economic zones and industrial parks need 94 million cubic meters of water per year. The greatest demand is in steel production, pulp, equipment manufacturing, and petrochemicals. In Dung Quat Economic Zone, Hoa Phat Group has invested more than 7 billion USD in the Hoa Phat Dung Quat Iron and Steel Complex. This is the project with the largest water demand in Quang Ngai Province, at about 73 million cubic meters per year.

Ho Duc Tho, Deputy General Director of Hoa Phat Dung Quat Steel Joint Stock Company, said: The project receives and uses raw water from Tra Bong River, with phase 1 using about 23.7 million cubic meters per year. This is the amount of water compensated by evaporation, deducting the amount of water circulated and reused. If water is not recovered and reused, the project’s water demand would be one million cubic meters per day and night.

Quang Nam Province currently has 13 industrial parks, including 10 industrial parks in Chu Lai Open Economic Zone, attracting 255 secondary investment projects, with total registered capital of VND 85,100 billion. The total water demand for industrial production in Chu Lai Open Economic Zone, Quang Nam Province, is about 38,000 m3/day and night.

Ngo Van Hai, Deputy Director of Chu Lai Truong Hai Industrial Park and Urban Infrastructure Development Investment One Member Co., Ltd., said: THACO Chu Lai Industrial Park invests in the fields of automobile manufacturing and assembly, mechanical engineering and supporting industry, agricultural and forestry processing, etc., with total investment capital of more than 4.2 billion USD. Each year, this industrial park uses 767,500 m3 of water, supplied from the two water plants of Tam Hiep and Tam Xuan. With the increasingly expanding scale, the demand for water in the industrial park in the next 10 years is about 10.5 million m3/year.

According to the Nguyen Hong Quang, Head of the Management Board of Economic Zones and Industrial Parks of Quang Nam Province, the demand for water for industry and services is increasing. The water source for Chu Lai Open Economic Zone is relatively favourable, the raw water is mainly exploited from the surface water of Phu Ninh Lake and Thai Xuan Lake with abundant and good quality reserves. Other industrial parks use surface water sources in the surrounding area according to the planning orientation of the province. The raw water source ensures the flow and quality to supply to the water plant serving the industrial production of investors.

Ensuring stable water supply

Along with the construction of infrastructure for economic zones and industrial parks to attract investment, the central coastal provinces of Quang Nam, Quang Ngai, Binh Dinh and Khanh Hoa prioritise resources and investment in water supply and drainage infrastructure to ensure sufficient and stable supply of raw water and clean water for industrial production, trade and services. Many provinces and cities attract investors to build and upgrade factories, transmission systems and water supply stations; at the same time, zoning water supply to ensure security and safety of water sources, preventing water source disputes.

The dense network of rivers and streams, tributaries of Phu Ninh Lake, Vu Gia-Thu Bon River system in Quang Nam Province; large reservoirs of Hoa Son, Da Ban, Cam Ranh, Suoi Dau, Ta Ruc and water from Cai Nha Trang River in Khanh Hoa Province; and Tra Bong River and Tra Khuc River in Quang Ngai Province, with large water reserves, are valuable hydropower sources for agriculture and industry.

Water security is one of the important conditions to increase competitiveness in attracting investment among localities. As soon as the economic zones and industrial parks were established, the central coastal provinces calculated how to solve the strategic problem of electricity, transportation and water systems for 20-30 years. The three provinces of Quang Nam, Quang Ngai and Binh Dinh have 19 water plants, supplying 147.8 million cubic meters for industrial production and services. Nhon Hoi Economic Zone and seven industrial parks in Binh Dinh Province have a large-scale water treatment plant system, including Phu Tai Water Treatment Plant, Binh Dinh Ward Water Treatment Plant, and Quy Nhon Clean Water Plant, with a capacity of more than 37.6 million cubic meters of water per year, meeting the basic needs of industrial parks and industrial clusters in the area.

Le Tien Dung, Director of Binh Dinh Water Supply and Drainage Joint Stock Company, said that the demand for clean water is increasing in Quy Nhon City and the nearly Becamex Industrial Park with the trend of developing services, urban areas, industrial parks. Therefore, innovating production technology and providing stable and safe water for production is the top priority today.

The river and lake system has abundant raw water reserves, Quang Nam Province and Quang Ngai Province are upgrading and expanding water infrastructure, and dividing water supply zones for economic zones and industrial parks. Quang Nam Water Supply and Drainage Joint Stock Company has 11 water plants, with a total design capacity of more than 40 million cubic meters per year, providing enough water for Chu Lai Open Economic Zone, industrial parks, and industrial clusters in the province.

In addition, Quang Ngai Province has Tra Bong River and Tra Khuc River, with a total length of 204 km, and 126 reservoirs, with a total flow of about 403 million cubic meters of water, which can supply 94 million cubic meters for industry and services each year. According to Hoang Nguyen Linh Chau, Director of Vinaconex Dung Quat Joint Stock Company: Dung Quat Water Plant has a capacity of 5.5 million cubic meters per year, providing water for industrial production and main services for Dung Quat Economic Zone. From 2020 to now, the unit has supplied 17 million cubic meters of water to 50 factories and enterprises, reaching 70% of capacity.

Many enterprises in the economic zone have invested in their own water supply systems, so the plant currently only supplies to key projects such as Dung Quat Oil Refinery and auxiliary manufacturing plants. If there are many large investors, the unit will upgrade and increase the water scale accordingly according to the needs of the enterprises.

The three key economic zones of Nha Trang, Cam Ranh and Van Phong in Khanh Hoa Province aim to become the economic centre of the South Central Coast, the Central Highlands, and the whole country. The province is taking the initiative in water resources to ensuring the needs of investors and businesses are met. Water sources are mainly taken from rivers and a system of 10 reservoirs and irrigation dams, providing about 25 million cubic meters of raw water each year for industry and services.

According to statistics from the central coastal provinces, the current demand for water for industry has not fluctuated much, with the actual demand being lower than that registered by investors. Many businesses are applying water-saving circulation systems and reducing wastewater to reduce wastewater treatment costs, so the capacity to meet the demand for raw water and clean water is stable for industrial production and services in the region.

Nguyen Tu Cong Hoang, Vice Chairman of the People’s Committee of Binh Dinh Province, said Binh Dinh Province is focused on investing in the water supply system and putting water plants into operation, in order to concretise the approved Urban and Industrial Park Water Supply Planning Project. In addition, the province focuses on developing water supply infrastructure, exploiting and using water resources effectively, contributing to improving the capacity to provide clean water sources that ensure standards, standards, and safe water supply for people and production and services.

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US giant Wanek Furniture to expand production capacity in Vietnam by 30% over 5 years

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Wanek Furniture Co., Ltd., a leading wood producer in the U.S., plans to expand its production capacity in Vietnam by 30% over the next five years, said Lien Andrew Michael, its vice president and general director of Asian factories.

At a meeting with Vietnamese Deputy Prime Minister Nguyen Chi Dung in Hanoi on Thursday, Michael stated that Wanek Furniture, a 100% US-invested subsidiary of Ashley Furniture Industries, Inc., has invested more than $200 million in Vietnam since 2008, with factories in the southern province of Binh Duong and the central province of Quang Ngai.

The company is now employing about 16,000 Vietnamese workers, he said, adding that its products have been shipped to 48 countries worldwide.

Deputy Prime Minister Nguyen Chi Dung and Lien Andrew Michael, Wanek Furniture's vice president and general director of Asian factories, in their meeting in Hanoi on March 13,2025. Photo curtesy of the government's news portal.

Deputy Prime Minister Nguyen Chi Dung and Lien Andrew Michael, Wanek Furniture’s vice president and general director of Asian factories, in their meeting in Hanoi on March 13,2025. Photo curtesy of the government’s news portal.

Dung welcomed Wanek’s plan to expand investment in Vietnam in the next five years. He affirmed that Vietnam will continue to improve its institutional framework and create favorable conditions for foreign investors, including those from the U.S., to engage in sustainable and long-term business operations in the country.

The Deputy PM urged the American firm to enhance cooperation with Vietnamese businesses to help Vietnam integrate more deeply into the global value chain.

He suggested Wanek continue to exchange information and coordinate with Vietnamese authorities to manage risks arising from the U.S.’s new trade policies.

“Wanek and the American business community should raise their voices to encourage the U.S. government to continue promoting relations with Vietnam and to minimize policies that could negatively impact the bilateral investment and trade ties,” Dung noted.

Appreciating Wanek’s contributions to the socio-economic development of Vietnam and the Vietnam-U.S. relationship, the Deputy PM emphasized that the U.S. is one of Vietnam’s key strategic partners, especially in the areas of trade and investment.

He affirmed that Vietnam aims to maintain and develop a harmonious, sustainable, and mutually beneficial economic cooperation with the U.S.

“Vietnam is always ready to cooperate in reducing the trade deficit the U.S. is incurring by encouraging businesses to increase imports of goods from the U.S., such as aircraft, LNG, and agricultural products,” he stressed.

Dung also confirmed that Vietnam is willing to engage with U.S. authorities to enhance mutual understanding and jointly address issues of mutual concern, while also promoting negotiations for a bilateral agreement to reduce tariffs and facilitate trade cooperation.

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Developing eco-industrial parks to attract FDI

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By 2030, about 40-50% of provinces and cities are expected to convert traditional industrial parks into eco-industrial parks, and 8-10% of localities will have plans to build new eco-industrial parks to plan and attract investment industries gradually.

In reality, industrial parks that develop sustainably are becoming the selection criteria for foreign investors with economic benefits and responsibility to the social community. In that flow, industrial parks in Vietnam face a trend of comprehensive transformation to retain investors and attract new investment projects, especially high-tech and large-scale projects.

The Ministry of Planning and Investment has just coordinated with the United Nations Industrial Development Organization (UNIDO) and the Swiss State Secretariat for Economic Affairs (SECO) to sign a project document on replicating the eco-industrial park approach to promote circular economy in Vietnam.

The project aims to promote the implementation of circular economy in enterprises in industrial parks, reduce the environmental impact of industrial production, and adapt to climate change.

Director of the Department of Economic Zones Management under the Ministry of Planning and Investment Le Thanh Quan said that since 2015, the Ministry of Planning and Investment and UNIDO have piloted the conversion of several traditional industrial parks into eco-industrial park models in four localities: Hai Phong, Da Nang, Ho Chi Minh City, and Dong Nai. In turn, 90 enterprises were supported with resource efficiency and cleaner production (RECP) solutions, and 429 out of 889 proposed solutions were implemented in Dinh Vu, Hoa Khanh, Hiep Phuoc, and Amata industrial parks.

RECP solutions helped enterprises reduce electricity consumption by 14,378 MWh/year, fossil fuel consumption by 264,127 GJ/year, water consumption by 278,690 m3/year, and greenhouse gas emissions by 55,663 tonnes of CO2 equivalent/year, bringing economic benefits to enterprises. Many industrial symbiosis and industrial-urban symbiosis solutions have been implemented, contributing to optimising waste reuse, concretising the implementation of circular economy, etc.

Currently, ecological industrial parks are becoming the selection criteria for foreign direct investment (FDI) with the goal of sustainable development, economic benefits and responsibility to the community and society. Many localities and industrial park infrastructure investors have identified that developing industrial parks according to a new model is an inevitable and urgent need to create sustainable competitive advantages.

Sharing at the recently held forum on comprehensive green solutions for industrial parks and investment promotion in Vinh Phuc Province, Chairman of Vinh Phuc Provincial People’s Committee Tran Duy Dong said that during the period of fluctuating global investment capital flows due to the COVID-19 pandemic, FDI capital in this locality was still higher than planned. From 2020 to now, Vinh Phuc has attracted an average of 500-600 million USD of FDI capital annually, the highest year reaching nearly 1 billion USD.

In just three years, from 2021 to 2023, Vinh Phuc’s investment attraction results exceeded the target set for the entire 2020-2025 term of 2 billion USD. This province also attracts high-quality investment flows from big brands such as Honda, Toyota, Piaggio and Daewoo.

According to the plan, by 2030, Vinh Phuc will have 28 industrial parks with an area of ​​about 4,800 hectares, in which priority is given to developing new industrial parks along key traffic routes such as the Hanoi-Lao Cai Expressway, Ring Road 4, Ring Road 5, etc.

In which, orienting investment to develop industrial parks to achieve high efficiency and towards sustainable development is one of the top urgent requirements.

According to economic experts, to successfully replicate the approach of eco-industrial parks to promote circular economy in Vietnam, it is necessary to develop a specific roadmap and implementation plan, continue improving mechanisms and policies, create favourable conditions for this transformation process, propose solutions for practical values and develop criteria to identify and register eco-industrial parks and eco-enterprises certification.

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