A corner of Nhon Hoi Economic Zone. The province will  withdraw licences of projects that have been delayed. — Photo kktbinhdinh.vn

HA NOI (Biz Hub) — The management board of Nhon Hoi Economic Zone has revoked the investment certificate of a Russian bus manufacturing project over delays in implementation in the central coastal province of Binh Dinh, said Deputy Chairman of the provincial People's Committee, Phan Cao Thang.

The project, owned by Russia's Buscenter Met Company Ltd, was meant to assemble and manufacture bus parts and agricultural machines.

Under the licence granted in April 2013, the US$1billion project was to be built on 50ha in Nhon Hoa Industrial Park in An Nhon township.

"The construction was expected to be finished in three years. However, it is now at a standstill," Thang told Biz Hub.

The project was the foreign direct investment project that had the largest-ever capital in the province.

Viet Nam and Russia signed an inter-governmental protocol on supporting the production of motor vehicles in the Southeast Asian country in March.

The document said Russian automakers would co-operate with Vietnamese partners to set up several joint ventures to manufacture and assemble trucks, cars with 10 seats and above, crossover utility vehicles (CUV) and a number of special-use vehicles.

The two sides have pledged to assemble cars under Viet Nam's planning for automobile industry development by 2020, with a vision towards 2030. In this, the local supply rate will be 25 per cent for special-use vehicles, 30 per cent for trucks and CUVs and 35 per cent for cars with 10 seats and above by 2020.

By 2025, the local supply rate is set to reach 40 per cent for special-use vehicles and CUVs, and 45 per cent for trucks and cars with 10 seats and above.

If the joint ventures failed to reach the committed local supply rate, their licences will be revoked.

During the first period of operation, Viet Nam will allow the joint ventures to import a number of complete built-up units without paying duty, which will be sold to get an understanding of the market demand. In addition, there will be no duty on imported components and auto assembly parts for five years.

The protocol will come into effect by mid-2016.

According to the Nhon Hoi Economic Zone, it has also withdrawn the investment certificate of the Nhon Hoi Wind Power Plant, which was jointly funded by Germany's Viettracon Management and Investment Limited Company and Switzerland's Green Venture Invest AG Company, for its delay in project implementation.

The project, granted a licence in 2014, was designed to be built on 600ha in the zone.

The plant was scheduled to make its first phase operational this year, with a capacity of 30.55 MW, and the second phase with 61.1 MW by 2020.

Local authorities said the province always provided the best conditions for investors to do business, but it would withdraw licences of projects that have been delayed. The withdrawal of licence is aimed at helping other investors to get an opportunity to do business in the province. — VNS