Workers assemble sewing machines at the Tan Thuan Industrial Zone. At the end of March there were about 1,254 projects, worth a total of $7.3 billion, in local zones. — VNA/VNS Photo Thanh Vu

HCM CITY (VNS) — Export processing and industrial zones in HCM City are showing signs of economic recovery with increased investment and higher production levels, according to the city's Export Processing and Industrial Zone Authority (Hepza).

In the first quarter of the year, local EPZs and IZs attracted a total investment of nearly US$145 million, a year-on-year increase of more than 21 per cent, said Ho Xuan Lam, head of Hepza's chief office.

Of the total, he said that $123 million was from foreign investors, an increase of 80 per cent compared to the same period last year. Domestic investors poured in nearly $22 million, a year-on-year decline of 57 per cent.

During this period, about 12 projects received investment certificates to set up in local zones. Five others have been permitted to add capital.

Two new projects had been put into operation, and another is waiting for a construction license.

"Production in the first quarter in these zones was more stable, with no bankruptcies or stopping of operations," Lam told Viet Nam News. "Some of the companies in food and foodstuff processing want to widen their investments."

He said that several sectors, such as the building materials industry, still faced challenges.

To help companies solve difficulties, Hepza promises to hold conferences in which companies located in Hepza will discuss their problems with local authorities and officials in the banking and tax sectors.

Hepza also plans to open trade promotion fairs in regional countries such as Laos and Cambodia to widen export markets.

Lam predicted that investments would improve until the end of next year. Many investors are thinking of setting up business in local zones and others are considering widening their investments.

Lam said that, at of the end of March, there were about 1,254 projects, worth a total of $7.3 billion, in local zones.

Of the total, foreign investors got involved in 495 projects with a total capital of nearly $4.4 billion. Domestic investors poured $2.9 billion into another 759 projects, he said.

Local authorities have reported that more than 1,000 projects were under operation, while 32 projects were under construction, 66 projects had yet to be carried out and more than 100 projects had been suspended or closed.

Last year, due to tough economic conditions, investment in local industrial zones and export processing zones fell substantially compared with previous years. —VNS