Bar raised on FDI projects

Scores of FDI projects have been slow to start building on cleared sites

Bac Giang People’s Committee told the Ministry of Planning and Investment (MPI) in March that it was determined to withdraw the investment certificate of investors who intentionally delayed investment commitments.

In its report to the MPI, the provincial committee said it would urge Taiwan’s Foxconn to construct the Van Trung Industrial Park, which was granted investment certificate in 2007. Other provinces including Binh Dinh, Quang Nam, Quang Ninh, Binh Phuoc, Phu Yen and Danang also told the MPI they planned to revoke the investment certificates of projects that had fallen behind schedule.

The reports come in response to a direction from Prime Minister Nguyen Tan Dung telling ministerial bodies and local authorities to tighten up management of foreign direct investment (FDI). Vietnam’s provincial authorities haven’t always been shy about withdrawing investment certificates in recent years.

Quang Nam province withdrew licences for eight foreign-invested projects worth about $108 million last year and Bac Ninh did likewise for 16 long-delayed projects with total investment capital of $47.64 million. But, provincial authorities report there are still many delayed projects in these provinces.

The new reports from the provinces, however, imply that local authorities will use their rights to reject FDI projects and ensure the quality of foreign investment flowing into Vietnam. Tran Van Tri, director of Quang Nam Department of Planning and Investment, said many foreign investors were meeting difficulties in mobilising funds or finding partners to sell projects.

“These projects are negatively affecting lives of residents and economic development of the province,” said Tri.

Nguyen Van Dung, deputy director at Binh Dinh Department of Planning and Investment, said the rejection of delayed FDI projects would not impact on the investment climate. In return, he said, the provincial authorities would create more opportunities for new investors. In Binh Dinh, four projects had investment certificates revoked last year.

The provincial committee also urged foreign investors to start the construction of other projects, including the $250 million Vinh Hoi resort and the $1.7 billion Vung Ro oil refinery.