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Friday,  Nov 24,2017,05:07 (GMT+7)

Three SEZs seen needing big money

By Tu Hoang
Friday,  Nov 10,2017,20:28 (GMT+7)
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Three SEZs seen needing big money

By Tu Hoang

HANOI – The nation’s three special economic zones (SEZs) will require dozens of billions of U.S. dollars to develop infrastructure in the coming years, according to their development plans passed to lawmakers for consideration.

The three SEZs are Van Don in the northern province of Quang Ninh, Bac Van Phong in the south-central province of Khanh Hoa, and Phu Quoc which is an island off mainland Kien Giang Province in the Mekong Delta.

Phu Quoc SEZ will need up to US$40 billion until 2030, with domestic capital accounting for 58.9% (US$23.49 billion), and foreign capital making up the remainder. In the 2016-2020 period alone, Phu Quoc SEZ will require US$20.38 billion, with US$11.32 billion (56%) to be raised from local sources and US$9.06 billion (44%) from international funds.

The SEZ will have to mobilize US$19.5 billion between 2021 and 2030, including US$12.17 billion (62%) from domestic sources and US$7.33 billion (38%) from foreign sources.

As for Van Don SEZ, around VND270 trillion (nearly US$12 billion) will be needed by 2030 and sourced from domestic and foreign funds, according to the province’s plan.

In particular, Van Don will carry out 42 projects from 2018 to 2022 at a total cost of VND164.85 trillion (over US$7.2 billion), of which VND109 trillion (US$4.8 billion) will be funneled into transport and technical infrastructure, VND127.25 trillion (US$5.6 billion) into services, tourism and trade infrastructure, VND11.85 trillion (US$520 million) into healthcare, educational, environmental, scientific and technological infrastructure, and around VND21.9 trillion (US$964 million) into secondary projects at industrial parks and non-tariff zones, and other investment and production projects.  

Quang Ninh Province said it could raise VND108.5 trillion (US$4.78 billion) from private investors for this period. For instance, Sun Group, the province’s strategic private investor, will complete an airport project this year and is planning to spend an extra VND1.5 trillion (US$66 million) to enable the airport to serve five million passengers a year.

Sun Group has also proposed a high-end resort and entertainment complex worth VND48.5 trillion (US$2.1 billion).

Besides Sun Group, FLC Group plans a similar luxury resort and amusement complex on Ngoc Vung Island with total capital of VND46 trillion (US$2 billion). Other investors such as CEO and MBLand are considering investment projects in Quang Ninh.

The province is confident in raising funds from the private sector.

Meanwhile, the province plans to use around VND26.4 trillion (US$1.16 billion) from its budget to fund transport and economic zone infrastructure development, site clearance and supporting works, among others. Around VND18 trillion (US$792.6 million) of the amount will go to projects until 2022.

Quang Ninh plans to set aside VND7.5 trillion (US$330 million) from its budget for Van Don SEZ and ask the central Government for a five-year allocation of VND10.5 trillion (US$462.3 million) starting from 2018.

In the second phase from 2023 to 2030, Quang Ninh will need an average of VND1.05 trillion (US$46.2 million) a year, which will be sourced from the SEZ’s annual budgeting plan.

Regarding the plan to raise VND135 trillion (US$6 billion) from foreign sources, Quang Ninh said this was a possible goal. Van Don currently has four FDI projects capitalized at US$131.4 million, and 14 ODA and NGO projects whose combined investments are US$4.9 million.

Regarding Bac Van Phong SEZ, there is little information about it.

The Ministry of Planning and Investment said it is in charge of crafting a law on special administrative and economic zones. Contents of the draft law are seen more open than those in countries like China, South Korea, Japan, Indonesia, Malaysia, Thailand, Singapore and Myanmar.

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