The Saigon Times Weekly October 5, 2002

          US$500 Billion for High-tech Park             

(By Quoc Hung)

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The HCM City government is calling for local and foreign investment in a high-tech park that is expected to change the city's unreasonable industrial structure

Mr. Pham Chanh Truc (C), head of the Saigon High-tech Park management, talks with delegates at the seminar
Mr. Nguyen Tri Dung (R)

The idea to develop a high-tech park is initiated more than 10 years ago. To translate the idea to reality, HCM City leaders held a seminar early this week to garner opinions for the master plan and the feasibility study for the first-phase development of this ambitious project. The seminar gathered some 200 participants, including government officials and local and foreign academics.
    The Saigon High-tech Park, to be developed on an area of 804ha in District 9, is designed to attract local and foreign investment in high-tech industries and to train manpower for industrial parks (IPs) and export processing zones (EPZs) in the South. Facilities for high-tech manufacturing, manpower training, research and development, services and modern infrastructure will be developed. Investment will be encouraged in key industries such as electronics, information technology, telecommunications, biotechnology, precesion engineering, automation, new materials and clean energy. The investment funds are expected to come from the State budget, official development aid and utilities companies. First-phase development. According to the draft master plan and the feasibility study, the first phase of the project will cover 300ha, to be developed between now and 2005. HCM City will invest US$500 million to develop infrastructure to facilitate investors' operations and manpower training. Works in the first phase include high-tech factories (nearly 100ha), the administration and service section, research and development facilities and housing for experts. For the time being, the project management board is collecting expert opinions on the project and 22 reports by 50 researchers to submit to the Prime Minister. "If approval is forthcoming, expected in November, the city authorities will start work on the project immediately later this year." said Dang Ngoc Dinh, former director of the Science and Technology Strategy. Research Institute and member of the project compilation board.

     According to Pham Chanh Truc, director of the project management board, in the first phase, priority will be given to attracting investment in the electronics, telecommunications, information technology, precision engineering and automation industries. More than 10 big companies from America and Europe and several others from Asia have met the broad and signed memoranda of understanding for investment in the project. "Some overseas Vietnamese from the Silicon Valley in the U.S have promised to invest once the infrastructure is completed," Dinh said.

     Strong determination. Dinh said the Government and central authorities have showed support and appreciated the feasibility of the project as HCM City is the financial, economic and industrial hub of the country and the center of the southern economic quadrangle (HCM City,Vung Tau,Dong Nai and Binh Duong). The city has great potential for science and technology and a large contingent of qualified intellectuals .A total of 36 industrial parks, export processing zones and software parks are operating well in the city , and investors in the high-tech park can supply their products to manufacturing factories there.
     According to HCM to City Chairman Le Thanh Hai, the city authorities will develop the project with strong determination and the best preparations. "The Saigon High-tech Park is one of the 12 key projects that the city's leadership approved in December 2000."
     Tran Du Lich, director of the HCM City Economics Institute, admitted that the percentage of high-tech industry in HCM City is too low. He said the city's industrial growth in the first nine months of this year showed signs of slowdown due mainly to the the unreasonable industrial structure. Lich cited that food processing and textile, garment and leather production made up more than 46% of the city's industrial production value while other goods accounted for a small share, for example mechanical products 7% and electronics under 3%."This structure shows that the city's industrial sector is dominated by labor-intensive industries like textile, garment and leather, or semi-processing of agro-products whose materials are not available locally," Lich said. He noted that with this structure, the city is facing fierce competition from neighboring localities which have an advantage in materials and labor cost, and its industry is losing the competitive edge.
      Investment attraction policy. The Saigon High-tech Park will give priority to attracting investment from the world's leading high-tech multinationals such as Intel, IBM, Microsoft and Acer. According to Truc , the project management board will offer the most attractive incentives to investors. "The city authorities will give concrete support to each specific investors such as long-term reduction of land rent or exemption of land rent for investor possessing source technologies," Truc said. Meanwhile, Dinh noted that for investment projects that are specially encouraged, the city authorities will not only offer land free but also reduce or exempt taxes and develop housing for experts.
     The project management board will ask the Government to allow foreign investors to register their projects only instead of asking for licenses as currently done. Evaluation of technology, financial capacity  and safety should be conducted after investors start operations, and the one-door mechanism and onsite customs procedure should be applied. It will also propose the Government allow free trade in the park.
     "The city will encourage the establishment of small and medium high-tech enterprises, and high-tech production and services businesses with different investment sources from local funds, overseas Vietnamese and foreign investors, " Hai said.

The Saigon High-tech Park