Thousands hectares of rice fields have been cleared to give place for IZs, but the occupancy rate of the IZs remains very modest, at less than 14 percent. In Bac Giang province, hundreds of hectares of land in IZs have been left idle. Local farmers have lost cultivation land and provincial authorities have to pay money for the site clearance, while the land has been left unused. Meanwhile, the provincial authorities still continue licensing more projects.

IZs, hi-tech zones left fallow

Nguyen Van Long, an old farmer, pointing hands to the land area which has been taken back by the local authorities to give to the investors of the Van Trung IZ project, said that the land area was once a large rice field. Located on the bank of the Cau River, having a good irrigation system, the rice field always gave bountiful crops to local farmers.

However, the “rice granary” has existed no more. Long and other farmers have left the rice field to give up place for the IZ project. However, the hundreds of hectares of land have still been left unused over the last four years, since Long and the farmers stopped cultivating rice on the field.

The Van Trung IZ project, which was advertised to become the place which gathers hi-tech projects making personal computers, laptops, mobile phones and other modern equipments, is now just a fallow land. The only things on the 100 hectare land area that people can see when they stand on the 1A Highway are a billboard and the grass.

According to the Bac Giang provincial IZ Management Board, the Van Trung IZ project would cover an area of 960 hectares, including 433 hectares to be reserved for the IZ. In 2008, the local authorities gave 230 hectares of “clean land” to the Taiwanese investor. However, no further progress has been made so far, and the land plot still has been left idle.

A big waste of the society’s resources

The Quang Chau IZ project is located just five kilometers from the Van Trung IZ. It got the investment license in 2005, under which the project would cover an area of 426 hectares, mostly agricultural land.

All the land area was allocated by the local authorities to the investor, the Saigon-Bac Giang IZ Company already. However, the investor has not made any further step to implement the project. To date, five enterprises have re-leased the land (25.42 hectares) for setting up their production workshops.

While the two big projects were still left unimplemented, Bac Giang provincial authorities granted investment licenses to two other IZ projects, the Song Khe-Noi Hoang IZ (158.7 hectares) invested by Hoang Hai Housing Trade Company and the Bac Giang Shipbuilding Industry Company, and the Vietnam-Korea IZ (101.53 hectares).

The former project, the Song Khe-Noi Hoang IZ, has not been kicked off yet, and what the project has now is just a fallow land area. Meanwhile, the latter project has just been on… paper.

More and more IZ projects licensed

There are five IZs in Bac Giang province, which cover an area of 1209 hectares. Of these, only the Dinh Tram IZ, established in 2003, has been nearly fully occupied. Meanwhile, the operation of other IZs has been very bad, while only 14 percent of the land in the IZs has been occupied, which is really a big waste of the resources.

According to the Bac Giang People’s Council, though existing IZs have not been fully occupied, the provincial people’s committee continues granting new licenses.

Bac Giang has developed thousands of hectares of agricultural land into the land for IZ development, spent thousands of billions of dong for the site clearance and infrastructure items. However, the investment has brought very modest efficiency. In the first six months of 2010, the total sum of money in tax collected from IZs was 3.5 billion dong only, while the figure was 15 billion dong in a long period from 2006 to 2010.

The art of hunting for IZ projects

A lot of investors rush to register the investment projects on building industrial zones (IZs), because the investment licenses would bring them fat profit when they transfer them to other investors.

IZs have been mushrooming in Mekong Delta over the last 10 years. The agricultural land here is cheap; therefore, investors do not have to spend too much money to compensate local residents for site clearance. Since the houses here are just short-lived, it is not too costly to relocate them. Therefore, it is easier in Mekong Delta to implement IZ projects than in any other places in the country. This has prompted investors to rush to pour money into IZ projects.

Hunting for projects

Just spending minimal money to compensate local residents for site clearance, investors surely can make fat profit right after they fulfill the construction of the infrastructure system in IZs, simply because the land price increases every day.

A lot of businessmen have been flocking to Long An province to hunt for IZ projects, especially the ones on “golden land areas”. Some of them seek projects for themselves, while others just act as “brokers”, who look for projects for… others to get “commissions” which are sometimes worth billions of dong. Other investors just try to obtain investment licenses from local authorities and then transfer the projects to others immediately.

That explains why just within a short period, 30 IZs and 40 small industrial workshop clusters were established in Long An province. The fact that the investor of an project in Can Giuoc district transferred the project right after he got a license once stirred up the project. However, such a thing now does not surprise anyone more.

Another project on an IZ development in An Nhut Tan commune was licensed to the Long An Steel Company. However, in fact, the project has changed hands.

Most recently, the Long An provincial people’s court brought a fraud case into trial. Do Van Son, the defendant, told his “client” that he could lobby for obtaining the investment license for building a 200 hectare IZ in Duc Hoa district, if the client, an enterprise in HCM City accepted to pay him 13 billion dong.

Son has also been found as the cheater in another case, where he also promised to help an enterprise in HCM City to obtain the investment license for a project in Long An province.

IZs remain quiet

There are 8 IZs in Can Tho City, but only two of them – Tra Noc 1 and Tra Noc 2 - have completed infrastructure systems and have nearly fully occupied.

Meanwhile, two IZs, O Mon and Bac O Mon, are still under the planning period. Three others, Hung Phu 1 (262 hectares), Hung Phu 2A (134 hectares) and Hung Phu 2B (967.27 hectares) have been left idle for the last many years.

In Hung Phu 1, what has been done in the last 10 years is the resettlement residential quarter.

In October 2007, the Binh Thuy industrial workshops’ cluster project, which is expected to cover an area of 63 hectares, was approved. However, the project has not attracted any investors so far.

In Hau Giang province, the Song Hau IZ in Chau Thanh district, which has existed for the last five years, still cannot produce. In April 2007, in the IZ, Vinashin started the construction a big shipbuilding yard capitalized at 60 tirllion dong. However, to date, the large area land remains unused.

In Vinh Long province, the My Thuan IZ took shape in 2000 after 400 households had to leave their homes and a lot of orchards were damaged. However, to date, the Saigon-Vinh Long brewery factory remains the only investor who has started the construction of its factory here in the third quarter of 2009. Meanwhile, the construction has been going very slowly.

According to the Can Tho Branch of the Vietnam Chamber of Commerce and Industry (VCCI) that the occupancy rate at 70 IZs in Mekong Delta is 22 percent only, and that the land in the region has been wasting.

Source: Lao dong.