Singapore's Sembcorp Industries announced Friday new collaborations in sustainable urban development in Vietnam by building five more Vietnam-Singapore Industrial Parks (VSIPs).
Witnessed by Prime Minister Pham Minh Chinh who is on an official visit to Singapore, Sembcorp announced a memorandum of understanding with its long-standing Vietnamese partner Becamex IDC to co-establish the five new VSIPs valued at approximately $1 billion.
Singapore’s Prime Minister Lee Hsien Loong, in a speech at his Thursday meeting with Chinh, hailed VSIPs as “concrete symbols” of the cooperation between the two countries. He said the VSIPs have “grown tremendously in scale and number” since the first project was launched in 1996. Today, there are 12 VSIPs across Vietnam.
The five new VSIPs are envisioned to be smart and sustainable industrial parks with low carbon footprints, Sembcorp said Friday. They will feature decarbonization solutions like rooftop solar systems, solar farms (where feasible), and green-certified buildings.
Real-time tracking devices will remotely monitor and manage energy, water and waste use, as well as traffic and security, to allow for enhanced visibility over operations, the Singapore giant added.
The Vietnamese government on Friday presented Sembcorp and Becamex with an investment license to develop the 500-hectare VSIP II in Nghe An province. The license is an expansion of the successful 750-hectare VSIP Nghe An I established in 2015.
The IP is located within the 1,159-hecatre Tho Loc Industrial Park, a core part of Dong Nam Economic Zone. Per a decision signed by Deputy Prime Minister Tran Luu Quang, construction must be completed in 48 months from the date of land delivery.
VSIP Nghe An I is host to large investments from manufacturing industries including electronics, garment manufacturing and fast-moving consumer goods companies. As of end-January 2023, the park attracted 39 projects with a total registered capital of $743.6 million, including 19 FDI ones worth $681 million.
Major foreign investors are Luxshare ICT with $330 million investment and Everwin with $200 million. Both are key suppliers of Apple. Everwin’s investment is expected to double soon.
Nghe An province in Vietnam’s north-central region plays a supporting role to the capital of Hanoi. Government-provided investment incentives of up to 15 years under Dong Nam Economic Zone are available to manufacturers.
Appointed by the governments of Singapore and Vietnam to operate the VSIP since 1996, VSIP Group - a joint venture between Sembcorp Development and Becamex IDC - has expanded to 12 developments to date.
The IPs are located in Bac Ninh, Hai Phong and Hai Duong in the north; Nghe An, Quang Tri and Quang Ngai in the central region; and Binh Duong and Can Tho in the south.
Sembcorp Industries received an investment license on October 17 to develop a 293.7-hectare IP in Can Tho city, its first in Vietnam's Mekong Delta. A VSIP could also take shape in the central province of Ha Tinh next year.
Over the last 27 years, the joint venture has drawn $18.4 billion in investments from more than 800 multinational companies, Sembcorp said Friday.
“Our commitment to Vietnam remains deep because the spirit of partnership has held strong. We look forward to the continued support of all parties as we grow VSIP,” Kelvin Teo, CEO of Sembcorp Development and co-chairman of VSIP Group, said.
“This year marks the 50th anniversary of diplomatic relations and 10th year of Strategic Partnership between Singapore and Vietnam. We have been privileged to partner with the government and to serve as an enabler for Vietnam’s investment potential,” he said.
Besides helping drive value-added economic transformation through bringing in international manufacturers, VSIP Group has also delivered wider societal impact to local communities across Vietnam. More than 288,300 jobs have been created by the joint venture in the industrial service sector, supporting the rise of Vietnam’s middle class.