The government is considering rent control on all industrial park
developers to screw down surging rates.
The Ministry of Planning and
Investment (MPI) has just introduced the draft of a new decree amending Decree
29/2008/ND-CP regulating the operation and management of industrial parks and
economic zones.
In the draft, the MPI proposed a
new rule requesting all industrial park developers to register land rental
rates with state management authorities, a thing that developers have never had
to do.
“This is a crucial regulation to
control rental rates at industrial parks because rates have been surging
sharply in recent years,” said Vu Dai Thang, director of the MPI’s Economic
Zones Management Department. Thang said if rates kept on surging, Vietnam would
lose its cost advantage against rivals like Thailand, Cambodia and Indonesia.
Statistics from the Economic
Zones Management Department show that average land rental rates at industrial
parks nationwide are ranging from $100 to $200 per square metre. Particularly,
some industrial parks in Hanoi announced land rental rates of up to $280 per
square metre.
“We understand the target of
developers is profit, but the surging rates will affect our country’s
investment climate. We want developers to register to ensure that increases
must be reasonable,” said Thang.
Industrial parks play a crucial
role to attract foreign direct investment (FDI) to Vietnam. According to the
MPI, industrial parks have attracted more than 4,000 FDI projects with total
registered capital of around $65 billion, accounting for nearly one-third of
FDI capital committed to Vietnam.
Because of the importance of
industrial parks, at a meeting held by the MPI in Hanoi two weeks ago, most
local industrial park management authority representatives agreed with the
ministry’s proposal.
“Last year, I introduced a
foreign manufacturer to invest in an industrial park. At that time, the rental
rate was $70 per square metre per 50 years, but when the manufacturer came back
later, about several months ago, the rate was $100. Consequently, the
manufacturer left Vietnam for other country,” said Bui Hong Mai, deputy
director of the Industrial Parks Management Authority in Bac Ninh province.
Ngoc Linh | vir.com.vn
Business & Investment Opportunities
YourVietnamExpert is a division of Saigon Business Corporation Pte Ltd, Incorporated in Singapore since 1994. As Your Business Companion, we propose a range of services in Strategy, Investment and Management, focusing Healthcare and Life Science with expertise in ASEAN. Since we are currently changing the platform of www.yourvietnamexpert.com, you may contact us at: sbc.pte@gmail.com, provisionally. Many thanks.
No comments:
Post a Comment