Based on existing advantages and assessing its appeal to investors, Dak Nong province has launched many investment attraction programmes, issued some policies on investment encouragement and incentives, and in a timely fashion, supplemented suitable investment attraction mechanisms to give a boost for local economic development, said Mr. Tran Xuan Hai, Director of Planning and Investment Department of Dak Nong.
Investment attraction results of Dak Nong province in 2014
The mountainous province of Dak Nong, established in 2004, did not see good results in investment attraction in the past years due to low starting point of development and tough socio-economic development condition, particularly infrastructure systems. But, with the assistance from central to local authorities, investment attraction results were positive last year. The province licensed 40 projects worth nearly VND 31,300 trillion (US$ 1,500 million) in 2014. Notably, Dak Nong drew some big projects like Dak Nong aluminium Electrolysis Plant, Thien Tam General Hospital, and Khang Nam agricultural and forestry production investment project.
With good external relations, the province attracted a lot of ODA and NGO programmes and projects in various fields for social and economic development. These projects are very meaningful when the Government has tightened fiscal policies, including public investment, as now. In 2014, the province had seven ongoing ODA projects with a total investment capital of VND 1,608,384 million. The Department of Planning and Investment also coordinated with project managers to carry out and speed up disbursement for 10 ongoing projects, worth US$ 7,254,285, funded by non-governmental organizations (NGOs). Besides, Dak Nong licensed one FDI project capitalized at US$ 900 million estimated to be disbursed in 2014. Most projects focus on mining, quarrying, construction sand, agriculture, forestry, trade and tourism. This shows that investors are keen on local strengths.
Although investment attraction is more positive, Dak Nong has yet to fully utilize its strengths and potential. So, what are the limitations that weaken its attractiveness to investors?
Last year, the province's business environment was improved though, however, its competitiveness remained low relative to other provinces in the country. Enterprises still feel unhappy when they do business in the province. The toughest difficulty of the province is the narrow market distant from major economic centres of the nation. Furthermore, Dak Nong is a mountainous province with poor transportation networks, technical and social infrastructure. In addition, this is home to many ethnic minorities with low literacy standards and low labour skills. Undeveloped domestic trade causes prices of goods to go up, resulting in a higher price of labour – a negative point in the eye of investors. Weak purchasing power and consumption capacity also affect the investor sentiment when they take trade investment projects into consideration.
Agricultural and forest product processing is one of major advantages of the province but the supply of agricultural product is unstable because of small-scaled, scattered farming and uneven input quality for processing and export. Land management is still inadequate and clean land fund for fresh investment projects falls short. Particularly, professional capacity and expertise of civil servants and officials in provincial and districts agencies are limited while the resolution of investment procedure is troublesome and time-consuming. Seeing these constraints and limitation, the province has reviewed all criteria to identify bottlenecks to improve the business environment.
What has Dak Nong done to deal with the above difficulties and attract more investors?
To improve the investment environment, the province has approved of the strategic investment attraction plan for the period until 2020 while building and carrying out many practical solutions. In addition to general State policies, Dak Nong has issued processes and policies on investment incentives in most areas and created favourable conditions for investors to do business in the province. It has also sped up information technology application to investment attraction like local electronic information portal and electronic single-window mechanism in a bid to shorten the time required to fulfill administrative procedures for investors. It has also strengthened direct dialogues between local authorities with businesses and investors to seek timely solutions to difficulties against them to create and build up the confidence of investors in Dak Nong.
The province will focus on enhancing the investment climate, deploying measures to raise the provincial competitiveness index (PCI), creating an open investment environment, and training officials in charge of investment promotion in order to quicken the settlement of investment and business procedures for investors and enterprises. Specially, Dak Nong will utilize its resources to enhance synchronous infrastructure and draw investment capital for locally advantageous fields.
Together with its efforts to better the investment and business environment in the past, how is the province's investment environment now?
Being aware of the importance of infrastructure to socio-economic development, in recent years, Dak Nong has utilized the State budget and call for all available resources to develop the infrastructure system, especially transport and power networks. Many important traffic projects have connected production regions and population groups to create momentum for socio-economic development, improve livelihoods of local people and stimulate trade. Local advantages like abundant mineral resources, land and climate suitable for developing livestock, agricultural, forestry and its proximity to major consumption centres are also major favorable conditions for the province to attract investors.
Furthermore, Dak Nong has introduced investment incentive policies to attract more investors. In the coming time, the province will issue more new policies, grant special preferences and best supports for investors and enterprises, and speed up administrative reform in the field of investment. It will also raise the quality of local labour and instruct banks to give loan to businesses and investors. Hopefully, with its efforts, Dak Nong will attract more investors.
According to Dak Nong Department of Planning and Investment