Soc Trang reforms investment climate

Soc Trang’s leaders have enacted a raft of practical solutions to improve the province’s business climate

The province’s An Nghiep industrial zone has accommodated major projects of both domestic and foreign investors, such as the Long Phu 1 thermal power plant by Vietnam’s state-run oil and gas group PetroVietnam, and foreign-invested textile projects by Tuntex, Best Way and Textray.

Many other investors have registered to do business in the province, such as India’s Tata Power with the Long Phu 2 thermal power plant project, and a wind farm project spearheaded by local investor Phu Cuong.

In the first six months of this year, 42 investors met with the provincial authorities in search of investment opportunities. A total of eight investment projects received investment certificates valued at VND376 billion ($17.2 million) in the total committed capital, and four other investment proposals were approved. Of the former, four projects were licensed by the Soc Trang People’s Committee, valued at VND123.4 billion ($5.6 million) and the remaining four projects were issued certificates by the Soc Trang Industrial Zones Management Authority, worth $252.6 billion ($11.5 million) in the total investment capital.

During 2009-2014, the Soc Trang Department of Planning and Investment, in co-operation with other authorised agencies, met 265 investors representing 267 projects. A total of 33 projects received approved investment proposals, and four others completed the survey process, valued at more than VND165.8 trillion ($8.2 billion) in the total committed investment capital. During this period, the province licensed eight foreign invested projects worth more than $79 million and 93 domestic investment projects valued at nearly VND29 trillion ($1.3 billion). The projects focus on fertiliser and packaging production, aquaculture and processing of agro-fishery products.

In recent years, Soc Trang has posted noteworthy results in attracting domestic and foreign investors to the province, making positive strides forward in the province’s socio-economic development plan during 2011-2015. New projects going into operation have created a large number of jobs, helping people improve their income as well as their quality of life.

The province’s socio-economic infrastructure has also seen remarkable improvements, as has local awareness about the importance of investment promotion activities to help lure investors to the province.

These outcomes, however, are still below expectations, relative to the province’s actual potential and its ever-increasing development needs. This subdued improvement is partly because the province is far away from Ho Chi Minh City – Vietnam’s largest economic hub. Also, crucially, its transport infrastructure leaves much to be desired.

In addition, the provincial authorities have room for improvement in terms of preparing a clear space for investors, as well as effectively supporting businesses to finalise investment procedures.

To ameliorate this situation, according to director of the Soc Trang Department of Planning and Investment Mai Phuoc Hung, the province will ramp up its efforts to better its investment climate.

Soc Trang recently enacted Plan 33/KH-UBND on measures and tasks to further improve its business climate and competitiveness, pursuing governmental Resolution 19/NQ-CP which presents major tasks and solutions to continue improving the business environment and national competitiveness from 2015 to 2016.

With this in mind, the province will expedite a raft of tasks and solutions to achieve these goals.

First, it will increase the publicity and transparency of investment projects, programmes and planning schemes, while stepping up legal support to help businesses grasp new laws, particularly the new laws on Investment and Enterprises, which came into force from July 1, 2015.

Second, businesses will get greater support in product sale and market expansion. In the upcoming time, the province will strive for effective implementation of the agricultural sector restructuring plan, focusing on linking products to the output market, and boosting trade promotion efficiency, with a priority given to local specialty products.

Third, efforts will be made towards accelerating administrative procedure reforms, primarily shortening the time required to process administrative business procedures. For instance, the time for business registration will be shortened from three working days to two, and from 30 days to 20 days for licensing planning schemes. The time to process construction permits, land permits, and permits for fire prevention will be cut by 10-30 per cent. The time for business tax declarations will be shortened to 121.5 hours per year, compared to the current 152 hours per year.

The province will also strive for a better quality of business support. Specifically, the province will continue improving the operational efficiency of the Soc Trang Investment Promotion and Business Support Centre in respect to information, advice, and training service provision to provincial-based businesses.

The centre’s other tasks are to ensure effective usage of funds to support small- and medium-sized enterprises (SMEs) under a project on supporting SME development, and to effectively operate a fund on credit guarantee for SMEs.

In a bid to simplify administrative procedures that will benefit businesses and investors alike, the centre was tasked by the Soc Trang Department of Planning and Investment to act as a central agency in meeting and directly supporting investors and businesses searching for investment opportunities in the province.

At the centre, investors will be able to receive advice and support, as well as submit their investment proposals. The centre will help them move along this process until they receive their final results from the Soc Trang Department of Planning and Investment. This policy of helping investors save time and costs has been praised by the business community.