The Ministry of Planning and Investment (MPI) has just announced the draft of the special economic administrative law with many of the most remarkable breakthroughs.
After being completed, the draft law is expected to build 3 special administrative units including Van Don, Bac Van Phong and Phu Quoc become 3 special economic zones with attractive investment environment.
Related to this topic, TheLEADER had a talk with Luu Bich Ho, former Director of Development Strategy Institute, Ministry of Planning and Investment.
What are your oppinions about the situation that while other countries such as China, Thailand, Laos, Myanmar which have many years experience in developing special economic zones, whether the preferential treatment of Vietnam for 3 special economic zones in the draft law is sufficient to compete and attract investors or not?
Luu Bich Ho: Vietnam's preferences for 3 special economic administrative units have not really achieved economic attractiveness.
Free trade agreements in the TPP (Trans-Pacific Strategic Economic Partnership Agreement) can be considered the highest incentive available today.
However, in order to attract investment in the special economic zones, we may have to offer higher incentives than that of TPP. We must reach the highest level of economic liberalization and go beyond current regulations.
When investors and businessmen in Vietnam's special economic zones feel no restrictions other than those of a very universal nature, we can compete with the rest of the world.
How do we maintain national security and defense in the special economic zones so as not to hinder investors but still ensure national security?
Luu Bich Ho: Developing special economic zones must go along with reaching the maximum level of security and national defense. Therefore, national defense must definitely be managed by the state.
As for security, in many foreign special economic zones, private security was hired. The issue of security and economic security must be left to the self-governing zone.
The police of state only manage the general to ensure there are intelligence operations and spy activities in the SEZ. The SEZ should create the maximum conditions for business investment, provided that such activity does not violate national security and political security.
In addition, one of the most controversial issues for the development of the SEZ is the institutional and administrative management mechanism. According to the current draft, special economic zones have a chief with great power instead of People's Committees and People's Councils.
However, I think that the powers must be clearly defined and accompanied by the responsibility and strict supervision mechanism to detect errors and timely handling if any.
What are the reasons why preferential policies in Vietnam's special economic zones are not attractive?
Luu Bich Ho: This is related to the perception, thinking and interests of law enforcement agencies so we do not dare to reach the highest level of business liberalization but only to a relative level.
I hope that in the beginning, we can do it at low levels but in the future, the mechanism needs to be improved. This can create motivation for development.
In the past, Vietnam built many open economic zones but in the reality, these were failed. In your view, at this time, does the government succeed?
Luu Bich Ho: Developing a special economic zone creates an empirical model and then this spreads and creates a driving force for the country's overall growth and development. Meanwhile, we do not have a special economic zone yet.
HCMC is the leader in the national economic development. 1% GDP increase of HCMC can generate a 0.24% GDP increase nationwide. So why do not we push this to develop the economy but want to push up a specific mechanism?
In fact, to develop the SEZ, we have to wait for 30 years. If this time is not successful, we will continue to wait. If 30 years is not enough for thinking and action, we have to wait until Vietnam feels really no other way than developing special zones.
Sincerely thank you!