Hau Giang Receives 2 Energy Investment Projects

Energy is always a promising sector to attract foreign investors to set up business in Vietnam.

Recently, while many provinces in the Mekong Delta are thirsty for foreign direct investment (FDI), Hau Giang – a province with difficult socio-economic conditions, is receiving investment registration of 2 FDI projects with investment capital of over 4 billion USD in energy sector.

According to the Department of Planning and Investment of Hau Giang province, the 1st project is the Jinko Solar Vietnam, which is the solar polar plant, invested by Jinko Solar International Development Co., Ltd (Hong Kong) in Hoa An commune, Phung Hiep district, Hau Giang province with the goal of producing commercial electricity from solar energy. The plant has a designed capacity of 35 MW, using 40ha of land and the land lease period is 50 years.

The total investment capital of the project is 1,168 billion VND (equivalent to 52.5 million USD). According to the legal representative of Jinko Solar International Development Co., Ltd, the company has sufficient financial resources to carry out the project. In terms of technology, the plant uses the technology to convert optical energy into electricity using energy panels (photovoltaic technology) for high conversion efficiency, reasonable investment cost and suitable with Vietnam climate.

The 2nd project is the Song Hau 3 thermal power plant, invested by Viet Lao Energy Development and Investment Joint Stock Company, representing the consortium of investors including: Deo Ca Investment JSC, Viet Lao Energy Development and Investment JSC, Phongsubthavy Irrigation – Bridge and Road Construction Co., Ltd (headquartered in Vientiane, Laos). The investors propose location of the project at Song Hau Electricity Center, Phu Huu A commune, Chau Thanh district, Hau Giang province.

The objective of the project is to invest in the construction of a thermal power plant to supply commercial electricity to the national electricity network to meet the increasing demand for electricity. The design capacity of the plant is about 2,000 MW (3 x 660 MW), the operating hour is about 6,500 hours per year; annual consumption output is 13 billion kWh per year. The land area for the project is 117.08 hectares, including the main factory area, slag yards, construction yard…The project implementation period is 50 years from the date receiving investment policy decision. Total investment of the project is estimated at 81 trillion VND (equivalent to 3.636 billion USD), 100% investors capital.

At the present, there are 29 FDI projects in Hau Giang province with total capital of 808,563,599 USD. If the 2 above projects are granted investment certificates, then Hau Giang will rise to the 2nd place in terms of attracting FDI investment in the Mekong Delta (only after Long An province, which currently attracts above 6.7 billion USD of FDI capital).

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Hemaraj (Thailand) Builds Billion-Dollar Industrial Park in Nghe An

Nghe An – a province located in the central region of Vietnam always has a lot of attractive incentives for foreign investors who come and set up business in Vietnam. In which, Nghe An has a number of solutions to support infrastructure enterprises to quickly implement large-scale industrial parks, including the Hemaraj industrial park – which is preparing to start construction.

According to the plan, at the end of October 2017, Hemaraj industrial park project in the South East Economic Zone will be started construction by Hemaraj Group (Thailand). construction work. The project has a total area of about 3,200 hectares, total registered investment of about 1 billion USD, divided into 7 phases, in which phase I has an area of nearly 500 hectares.

According to leaders of Nghe An province, the provincial leaders are providing maximum support to Hemaraj so that the project can started construction as soon as possible.

Prior to that, in September 2015, a joint venture between Sembcorp Group (Singapore) and Becamex IDC have kicked off the VSIP Nghe An project with an area of 750 hectares. Currently, the project has leveled and built synchronous infrastructure for about 100 hectares of industrial land phase 1A.

More than 90 companies from many countries and territories have come to seek information and investment opportunities at VSIP Nghe An and 10 companies have signed investment commitments with total investment capital of over 400 billion VND. By the beginning of September 2017, some companies was handed over land and started to build the plant.

In order to attract investment, leaders of Nghe An province will be more drastic in reforming administrative procedures. Accordingly, if foreign enterprises want to complete the investment license application, they should only go through the one-stop department of the Investment Promotion Center of Nghe An province.

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Toyoda Gosei Invests in Auto Parts Factory in Tien Hai Industrial Park

Toyoda Gosei Group, the world’s leading manufacturer of auto parts, supplying for Toyota (Japan) has decided to choose Tien Hai Industrial Park, Viglacera as the location to set up factory in Vietnam.

Viglacera Real Estate Trading Company and Toyoda Gosei Group of Japan have just signed a land lease contract with an area of 11.3 hectares in Tien Hai Industrial Park, Thai Binh province, which is invested by Viglacera Corporation.

Toyoda Gosei is the world’s leading auto parts manufacturer, supplying for Toyota, with a network of about 100 factories and offices in 18 countries and regions.

The new plant is expected to be built in early 2018 and put into production in 2019 with a total investment of 24.6 million USD, specializing in the production of airbag components and airbags for safe protection for drivers and passengers in cars, leather and polyurethane coated car steering wheels.

Toyoda Gosei’s products will be exported to Japan, USA, Europe and some other regions.

Toyoda Gosei has also invested in Hai Phong, with 3 large-scale workshops, and also one of the largest investment companies in Nomura Industrial Park in Hai Phong.

Tien Hai Viglacera Industrial Park has the advantage of geographical position when locating near the coastal highway connecting the 6 northern coastal provinces (Quang Ninh – Hai Phong – Thai Binh – Nam Dinh – Ninh Binh – Thanh Hoa), which has just started construction in May 2017. In which, the construction of the expressway locating in Thai Binh province will be completed by the end of 2018, shortening the distance and travel time from the industrial zone to Hai Phong port (40km) – 60 minutes).

In addition, enterprises in Tien Hai Industrial Park are also enjoying attractive incentives for enterprises in the economic zone such as 10% corporate income tax rate for 15 years, tax exemption for the first 4 years and reduction of 50% for the next 9 years; land rental exemptions from 11 to 19 years; import tax incentives; personal income tax incentives…

Therefore, only after less than one month since the decision to establish Thai Binh Economic Zone was issued, Tien Hai Viglacera Industrial Park has received the attention for information and investment decision from many investors coming from the countries like Japan, Korea, Hongkong, Taiwan…

In order to meet the increasing demand for land leasing to build factory in Tien Hai Industrial Park, Viglacera is actively promoting land clearance to ensure a large area of clean land, complete construction of infrastructure to create the most favorable conditions for businesses operating here.

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Foreigners Rushing to Buy Real Estate in Vietnam

Hundreds of millions of dollars are waiting to pour into Vietnam real estate market in most segments. The real estate market attracts a lot of foreign investors, mainly through M&A activities.

According to the newly announced report from Savills Vietnam, in quarter 2 of 2017, housing development projects received strong attention. China Fortune Land Development Group has bought shares in VinaCapital’s Lotus Dai Phuoc project for 65.3 million USD. Dai Phuoc Lotus is a residential area project with a total area of 198.5 million hectares in Dong Nai province, bordering Ho Chi Minh City.

In addition, VinaCapital’s Times Square project (Hanoi) worth 41 million USD is also transferred to Elite Capital Resources Limited.

Japanese investors are also active in the market. Nishi Nippon and Hankyu cooperate with Nam Long to build a 26 hectares Mizuki Park residential project in Binh Chanh district, Ho Chi Minh City with total investment capital of 351 million USD.

In addition, Aeon Mall – the famous Japanese retailer has officially co-operated with BIM Group to develop the second shopping center of Aeon in Hanoi with an area of 16.7 ha, the estimated investment capital is 200 million USD.

In the field of industrial real estate, Hemaraj Land & Development (Thailand) and Cienco 4 (Vietnam) have officially confirmed the joint venture to establish 1 billion USD industrial park on 3,200 hectares of land in Nghe An province.

In recent years, the real estate market of Vietnam has witnessed the strategic moves of investors, including mergers – acquisitions and development – cooperation. Some typical deals include Gaw Capital’s acquisition of a series of high-value commercial properties from Indochina Land, Gamuda Land’s acquisition of stake of local investors in the Celadon City project.

At the same time, the M&A market happened on a large scale in all different segments, such as the joint venture between Chau Tai Phuc and Suncity Group into the large resort and casino project in Nam Hoi An with total investment of up to 4 billion USD or the deal that Lotte acquired Diamond Plaza.

The market is expected to continue to be active in 2017 with a series of acquisitions and mergers.

According to JLL Vietnam, in the first half of 2017, Vietnam has attracted about 19.2 billion USD of foreign investment capital, increase by 54.8% over the same period last year. This shows that Vietnam is still one of the potential markets for investment in Southeast Asia.

There are hundreds of millions of dollars waiting to be poured into the domestic market in most segments, including housing, offices, retail, hotels and industrial parks, according to JLL. Investors come from different countries like Japan, Korea, Singapore, and the growth of investor groups from China.

Joint ventures are becoming more popular among foreign investors – with strong financial strength and experiences, they will work with local corporations – investors who holding land in the market and also has close relationships with local authorities.

The hotel segment has always attracted the attention in the recent time with a lot of foreign capital poured into Vietnam. Forecasting this trend will continue to grow, while other markets such as industrial park and education are also growing constantly. The affordable housing market is seen as attracting much investment capital, largely due to the rise of the middle class.

Lastly, according to Savills Vietnam, M&A will continue to be the form that the vast majority of investors will use to enter the Vietnamese market in order to realize their goals.

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Foreign Investors Implement Food Projects in Vietnam

Foreign investors who are licensed to invest in the food sector in Ho Chi Minh City are in the process of implementing the project, while other projects are interested by foreign partners. It shows the excitement of investors when deciding to set up business in Vietnam.

In particular, project of Nam Duong International Food Co., Ltd with registered capital of 25.6 million USD has completed the construction of the factory, installation of equipment and machinery. The project is licensed by the end of 2015, which is a joint venture between the Saigon Co-operative Alliance (Saigon Co.op) and Wilmar International Limited (Singapore), with the capital contribution of 49% and 51% respectively. The project aims to produce sauces and spices for domestic and export markets.

Wilmar’s investment in Vietnam and cooperation with Saigon Co.op is to utilize strengths from both sides to improve the competitiveness and coverage of Nam Duong brand as well as contribute significantly to the development of the sauce and spices industry.

Meanwhile, the project of CJ Cau Tre Foods Joint Stock Company, with investment capital of 53.3 million USD, which was licensed by the end of May 2017, is being expedited by investors to implement the procedures under regulations to prepare to start construction.

This is a food processing complex on an area of 7.1 ha, including food processing plant, research and development center, modern food safety center… The 1st phase of the factory has designed capacity of 12,000 tons of products per year, which will be consumed domestically and exported to markets such as Korea, Japan, USA, EU…

The project is invested by CJ Cheiljedang Corporation (Korea) through the ownership of 71.6% stake in Cau Tre Export Processing Joint Stock Company.

We can see that, in recent times, many foreign investors have approached the market by acquiring or holding controlling shares in local companies and it is forecasted that this trend will continue.

In terms of attracting investment in the coming time, Ho Chi Minh City has many incentive policies for projects in 4 key industries, which are food processing, chemicals – rubber, mechanical and electronic – information technology. The field of food processing has received a lot of attention from many foreign investors and the fact that many large-scale investment projects have been licensed.

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