Sun sets on the central coast’s tourism projects

Lang Co beach offers many charming locations for projects,
but developers have yet to draw a line in the sand

With its 120 kilometre coastline, warm climate and hundreds of famous landscapes, the former imperial capital of Vietnam is considered the  promised land in the eyes of many foreign tourism property developers.

After the Investment Law took effect in 2007, for consecutive several years, the province licenced many large-scale resort projects worth millions of dollars.

At this time, Thua Thien-Hue province has attracted 44 tourism property projects, with four already having their licences revoked due to excessive delays. The other projects have registered investment capital of $1.47 billion, according to the latest MPI inspection.

However, snail’s paced construction plagues the remaining projects. A MPI investigation report revealed that the implemented investment capital of the 40 projects reached only $63.7million, a 4.3 per cent of their total registered investment capital while 29 projects violated laws.

For example, Thuan An-Tan My tourism project was transfered to Electronic and Informatics Joint Stock Company in 2009 after its former developer Thuan An Development and Investment  Company had incurred losses and failed to operate the resort. However, the new developer has not registered the transfer with the authorities.

Meanwhile, the Pilgrimage ecological resort used more than 5,500 square metres of residential and garden land for tourism purposes but its developers had not registered land use purpose changes.

Thanh Tam resort was licenced with a 50-year land lease, however the land lease contract signed between the developer with the local authorities is only for 34 years.

Meanwhile, Chan May-Lang Co Economic Zone Management Board granted a licence allowing  Lang Co Tourism Limited Company to sell and lease villas in the third phase of Lang Co Resort. However, the company’s business registration certificate does  not allow for the trading of real estate units.

The continuing delays because of developers lacking financial ability to execute projects have prompted the MPI to get tough.

Recently, it suggested revoking the licenses of five tourism projects situated along Lang Co beach, one of the most beautiful beaches in central Vietnam due to indolence.

The Lang Co marine eco-tourism area project, developed by Lang Co Eco-Tourism, is one of the projects in danger of facing the axe.

Licenced in November 2007 with total investment capital of $6.3 million,  by the end of last year, the project’s total implemented capital reached only VND8 billion ($386,473).

Doan Thanh Ha, a representative of Lang Co Eco-Tourism, said the  three year delay was due to financial difficulties, with the government’s current monetary tightening policy biting. As a result, the company has only mobilised VND10 billion ($483,000) for the project.

The Diana marine tourism area, developed by Viet Trade and Investment Service JSC, was licenced four years ago. However, at this time, the developer has just fenced the project site and constructed pathways inside the projects. The developers have not reported the delays to local authorities. The MPI’s inspectors suspect that the developers are not financially strong enough to proceed with the project as the firm only has contributed only VND10.5 billion ($507,250) to the project, whilst its total investment capital is VND232 billion ($11.2 million).

Meanwhile, Handico Investment, Construction and Furnishing JSC’s $7 million Lang Co eco-tourism area project was licenced in 2007. However, it remains on paper. The developers also did not report the status of the project to local authorities.

The MPI’s inspectors also detected that Hoa Binh-Hue Development and Investment JSC’s $9 million Hoa Binh International Resort project had been behind schedule for three years. The company owned only VND5.34 billion ($258,000) and has to date spent only VND5 billion ($240,000) on the project.

Another project in danger of having licence revoked is Conic Lang Co Resort, which was licenced in the end of 2006 with its developers pledging to finish construction two years later. The $14 million resort is still on paper.

Meanwhile, three under-construction projects are in danger of having  their licences revoked due to developers’ failures to get their houses in order.

One of three projects is Huong Giang Tourism JSC’s $14 million Thuan An Resort. Licenced in August 2008, the project started construction in November 2011 and expected to be completed in December 2011. However until March, Huong Giang Tourism JSC had just advanced VND75 million ($3,723) in compensation to local residents.

The $7.3 million Mysterious Pilgrimage resort, licenced in 2007 and the $20.3 million Public Constructions and Service Resort licenced in 2008 are also in the red zone.

The MPI requested the provincial people’s committee find methods to speed up the construction of golf course projects such as Lang Co golf course and resort, Lap An golf course and resort and Thien An golf course.

Hue-Thu Duc House JSC’s La Sapinette resort, CIT Investment and Tourism JSC’s Lap An-Lang Co luxury resort, VicoLand’s Mediterranean Legendary resort, Bai Chuoi Vietnam Co.Ltd’s Bai Chuoi resort and Electronic Communication JSC’s Tam Giang ecological tourism area are also still delayed.

The MPI requested Thue Thien-Hue People’s Committee make any decisions to punish the delayed tourism projects before September 30, 2011, while decisions to revoke project licences must be made before  December 31, 2011.