State Budget allocation for some infrastructure construction is among preferential policies and regulations that the Prime Minister has approved for the Da Nang Hi-Tech Park in a new decision.
Doan Hung Anh, deputy head of the park’s management board, said that the PM’s approval would smooth the way for Da Nang to call on more key investors to invest in hi-tech industries that the city has planned in the Master Plan until 2030, with vision to 2050.
The decision, in general, would facilitate domestic and foreign investment inflow in the hi-tech park, he said.
Under the decision, the Government will allocate State Budget funds for projects aiming to complete technical infrastructure in the park by 2020.
The Government will also raise Official Development Assistance (ODA) funds for Da Nang to develop public utilities projects at the park and to establish technology research and application centres as well as hi-tech business incubators.
Da Nang will use funds from the local budget to complete investment and project proposals.
Anh said the decision, which takes effect next month, would be a magnet for global insdustrial firms and producers, offering flexible land rent, land clearance, income tax and import tax policies including land rent exemption for the first three years of operation.
He said the decision would also be a legal base for the city to build its own support and priority mechanisms and create more room for businesses to grow in Da Nang.
A corner of Da Nang Hi-tech Park in Hoa Vang district. The Prime Minister has approved preferential policy and regulations for investors at the Park. — VNS Photo Doan Hung Anh
Tax preferentials
Under the decision, investors in traffic, technical infrastructure and public works, or special investment projects will enjoy land-rent exemption for the entire duration of their investment period in the park.
Other incentives offered to investors include a 10 per cent tax rate for 15 years, a four-year tax exemption and a 50 per cent cut in income tax for the following nine years.
Investors with projects valued at more than VND3 trillion (US$133 million) will enjoy a 10 per cent tax rate for 30 years.
The decision also states that businesses will have to pay no import tax on materials and equipment that are not available in Viet Nam for the first five years of operation.
The park will also offer investors land-rent exemption for the initial construction period of infrastructure, while special listed projects will enjoy land rent exemption for 19 years.
The 1,100ha park in Hoa Vang District, 20km west of the city, is envisioned as a hub for green and hi-tech investors, and one of three major national multi-functional hi-tech park in the country after HCM City and Ha Noi.
The first phase of development, covering 300ha, has been completed. Work on the second phase, estimated to cost VND363 billion ($16 million), has begun.
The park is situated near the Da Nang-Quang Ngai Expressway to connect with the Chan May Economic Zone in Thua Thien-Hue, the Chu Lai Economic Open Zone in Quang Nam and Dung Quat Economic Zone in Quang Ngai Province.
According to head of the park’s management board, Phung Tan Viet, the park has attracted six projects – two Japanese and four domestic investors - worth $180 million.
The two Japanese investors – Tokyo Keiki Precision Technology Inc and Niwa Foundry, have already begun operating their plants, which have a combined investment of $62 million.
In 2015, Tokyo Keiki Precision Technology Inc inaugurated its first plant outside Japan on a 30-hectare plot in the park with a capacity of 50,000 digital directional valves per month for the Asia-Pacific region.
The same year, an investment licence was granted to the Danapha Pharmaceutical Joint Stock Company’s first nano-technology and biotech project with an investment capital of VND1.5 trillion ($67 million).
In 2016, the park granted an investment certificate to the U&I Logistics Joint Stock Company for a logistics project with a total registered capital of $14 million.
Last year, local firm QCM Technology Company, which has an embedded software system development project, also decided to invest $5 million in seafood processing, agriculture and forestry production.
According to recent reports, Da Nang has thus far attracted a total of 546 foreign direct investment (FDI) projects worth more than $3 billion. —VNS