Monday, June 25 2018

VietNamNews

Samsung ups investment in northern plant

Update: June, 12/2013 - 09:48

HA NOI (VNS)— Samsung Electronics Viet Nam, a wholly-owned subsidiary of South Korea's Samsung Electronics, received approval from the Government to raise its investment in northern Bac Ninh Province from US$1.5 to $2.5 billion.

Nguyen Quoc Chung, director of the provincial Department of Planning and Investment, said the added capital would be invested in another plant with special incentives.

Accordingly, Samsung would continue to pay a preferential tax of 10 per cent for 30 years, with corporate income tax exemptions for the first four years and tax reductions for the next five years. The normal corporate income tax in Viet Nam is 25 per cent.

Chung told Viet Nam News that the preferential tax was approved by the Government and related ministries and agencies.

The province had not offered additional incentives for the investors, he added.

Last year, Samsung got approval to increase investment to develop its complex in the province from $670 million to $1.5 billion.

The complex has produced mobile phones, laptops and other electronic products.

Since late 2009, the plant in the province's Yen Phong industrial zone has been operating efficiently. Last year, it produced more than 100 million products with export turnover of $12.7 billion.

In the first quarter of the year, the company earned export turnover of $5.2 billion.

In March, it also began the construction of a $3.2 billion high-tech complex in the northern province of Thai Nguyen.

When completed, the area will house Samsung's largest mobile phone factory, which is expected to provide jobs for thousands of local people.

It will also contribute billions of dollars to the country's annual export turnover, while boosting the development of the electronics support industry in the northern region of Viet Nam.

Recently, six projects providing components for the complex have been licensed with capital totaling $100 million.

The South Korean Group announced last year that it would expand operations in Viet Nam and planned to spend $2.2 billion by 2020 to reduce production costs and transport fees.

Bac Ninh province strives

Northern Bac Ninh Province is seeking suggestions from businesses to help them overcome economic turmoil and enhance the provincial competitiveness index (PCI), a system that evaluates regions based on their capacity to facilitate investment.

The PCI reflects the perception of over 8,000 domestic firms – operating in all of Viet Nam's 63 cities and provinces – on the economic governance and business environment in their locality, based on indicators such as transparency, time cost and proactivity.

Vice chairman of the Bac Ninh People's Committee Nguyen Luong Thanh told a seminar last week that the province wants to improve its score by focusing more on indicators that it has sidelined in the past.

Specifically, legal regulations influencing investment projects will be improved, with Bac Ninh hoping to gain a place in the top 10 provinces in this area.

This year the province has pledged to listen to the recommendations of businesses in order to improve its allure for investors by raising its PCI scores and maintaining its leading position nationwide.

Thanh said that while Bac Ninh does not offer investors conditions that are more favourable than in other provinces, it always strictly complies with State regulations in order to significantly better its PCI.

According to the overall index, the Cuu Long (Mekong) Delta province of Dong Thap topped Viet Nam's 2012 PCI. It was followed by An Giang and Lao Cai. Rounding up the top five were Long An and Bac Ninh, which was named one of the best governed provinces in Viet Nam.

Thanh said his province's PCI in 2012 scored lower than hoped, but local authorities have responded positively by improving the business environment. Even with the disappointing score, the province was still named the second best of among northern provinces and the leader of the Hong (Red) River Delta region.

Dau Anh Tuan, acting director of the Viet Nam Chamber of Commerce and Industry's (VCCI) legal department, said that leading provinces should be wary of unrealistic expectations for their PCI scores, even after promoting positive reform, as there are still problems with enforcing good policies.

According to a survey conducted by VCCI, up to 90 per cent of enterprises believe that few provincial policies are ever implemented at the district level. — VNS


Send Us Your Comments:

See also: