Singapore and Vietnam will study the feasibility of building an industrial park in Quang Ngai province in central Vietnam, a development they believe can spur growth in the region.
It will be the first foray into the region by the Vietnam-Singapore Industrial Park (VSIP) joint venture, which runs four industrial parks.
Yesterday, it signed a memorandum of understanding with the People’s Committee of Quang Ngai province to conduct the feasibility study.
The Istana ceremony was witnessed by visiting Vietnamese President Truong Tan Sang and Singapore Prime Minister Lee Hsien Loong.
VSIP is a tie-up between Vietnam’s Becamex IDC and Sembcorp Industrial Parks and yesterday, their chairmen highlighted the value of locating an industrial park in Quang Ngai.
Said Becamex IDC chairman Nguyen Van Hung: “The government has invested in a lot of infrastructure, facilities and even social amenities around the area. They need a good player to (take) development to another level.”
He also said VSIP’s tenants have asked for it to expand to central Vietnam, which is home to about 20 million people.
Sembcorp Industrial Parks executive chairman Low Sin Leng said Quang Ngai was a “strategic choice”, being a promising centre of growth.
Although Quang Ngai is not among Vietnam’s top-grade cities like Hanoi and Ho Chi Minh City, she noted that an expressway is being built to the major city of Danang, a tourism hub with direct flights to Singapore.
VSIP runs two industrial parks in Binh Duong, near Ho Chi Minh City in the south, and two more in Bac Ninh and Hai Phong near Hanoi in the north.
The proposed fifth park will be in Dung Quat Economic Zone, one of the few remaining areas in Vietnam offering incentives to investors.
Quang Ngai is ideal for labour intensive industries such as fast-moving consumer goods and food and beverage manufacturing, VSIP said in a statement. Said Ms Low: “We are putting in very long-range planning for VSIP. It shows our confidence in Vietnam’s economic growth.”
VSIP also wants to continue contributing to Vietnam’s social development, she added, noting that VSIP has invested US$4 billion (S$5 billion) in Vietnam since 1996 and created more than 100,000 jobs. The company also plans to help in the urbanisation of Vietnam, by building more housing and commercial projects.
The proposed 500ha industrial park is paired with an “integrated township” of about the same size for commercial and residential use.
Mr Sang, who ended his three-day state visit yesterday, stressed several times that Vietnam welcomes more investment from Singapore companies. During his visit, he visited Keppel FELS, which designed and built Vietnam’s first semi-submersible drilling rig.
He and PM Lee discussed trade and investment, among other topics, when they met. Both leaders affirmed the strong bilateral ties and spoke of strengthening cooperation in international fora like Asean, said Singapore’s Foreign Affairs Ministry.