Large-scale Dong Nai plans remain mired in difficulties

Dong Nai authorities are looking for ways to expand available industrial land to accommodate large-scale manufacturers’ needs, with the large-scale projects of Long Thanh High-tech Industrial Park and Hyosung Dong Nai highlighting how land is running scarce for new set-ups and expansion alike.

Long Thanh High-tech Industrial Park (IP) was granted an investment certificate in 2015 with the total investment capital registered at $282 million. The project is located on an area of 410 hectares and was expected to put the first phase into operation in 2017. However, up to now, the investor has been unable to begin construction.

According to Somhatai Panichewa, general director of IP developer Amata Vietnam, the slow pace in land clearance and compensation is holding up progress in infrastructure development and the following steps of the project. 

The scheduled operation date in 2017 drew in many foreign-invested enterprises in high-tech manufacturing to register land plots and set up factories at the project before it got stuck. It was expected that the park would have attracted at least $2 billion from foreign investors when it had come into operation three years ago.

Cao Tien Sy, general director of Dong Nai Industrial Zones Management Authority (DIZA) said that so far, Long Thanh High-tech Industrial Park has disbursed less than $5 million for land compensation. The key reason hindering compensation procedures was the lack of land areas to set up resettlement areas for locals.

Sy told VIR that in order to support the developer with the issue, the province had recently reserved a 47ha plot in Long Thanh town to resettle local residents giving up their land for this project. “We expect that the land clearance and compensation for this project will be finished within this year and we can hand over clear land to the investor soon after that,” Sy said.

Meanwhile, Hyosung Dong Nai, a subsidiary of South Korea’s Hyosung Vina, is also facing difficulties in expanding the area of another project in Dong Nai. Hyosung Dong Nai was also granted an investment certificate in 2015. With the total investment capital of $660 million, this company is occupying a 22ha plot in Nhon Trach 5 Industrial Park to manufacture industrial materials, textiles, chemicals, and heavy electrical machinery.

According to the DIZA, Hyosung Dong Nai has so far disbursed $650 million to finish the construction of its factory and put it into operation, providing employment to more than 1,900 locals. With its ambition to expand the facility, Hyosung Dong Nai wanted to rent an additional 10ha at the IP, but there is apparently no land left to be leased.

The representative of Hyosung Dong Nai was not available for comment. However Sy said that he had recommended Hyosung Dong Nai several neighbouring IPs such as Nhon Trach 6 to set up its expansion factory.

Dong Nai is an industrial province with a very high portion of its land being industrial land, with 31 of its 32 IPs enjoying occupancy rates of over 80 per cent. Large-scale Dong Nai plans remain mired in difficulties

“Many investors in the province are now requesting more land to expand their activities, but not much land is left. At present, Dong Nai People’s Committee is instructing the local authorities to review and formulate plans to expand and develop more IPs to meet the investment demand,” Sy said.

He said that Hyosung Dong Nai should pick a site as soon as they can because the land fund is also dwindling in neighbouring parks as occupancies are increasing very fast.

Dong Nai is now home to 49 foreign-invested projects with the total registered investment capital of $100 million and upward. The majority of these projects have reported healthy operations.