The Saigon Hi-tech Park in District 9, Ho Chi Minh City (Photo: VNA)

HCM City (VNA) - The Southern Key Economic Zone needs more robust policies and mechanisms for attracting resources and foreign direct investment (FDI) and enhancing linkages between localities to enable the region to develop faster and sustainably, according to experts.

The zone, which consists of Ho Chi Minh City and the seven provinces of Binh Duong, Tay Ninh, Binh Phuoc, Ba Ria – Vung Tau, Long An, Tien Giang, and Dong Nai, accounts for only 8 percent of the country’s area but plays a leading role in its economic development as it making up 60 percent of the Government’s revenues.

The region also tops in FDI attraction, accounting for 50 percent of the capital and 60 percent of projects, Nguyen Thi Minh Chau of the Banking University in HCM City told a recent workshop in Binh Duong. But FDI flows to the region lost steam in 2015-2017, she said.

For instance, they increased by 11.8 percent in 2016 and 8.4 percent last year, she explained, blaming it on the lack of linkages between localities in the region.

There is a lack of coordination between management agencies as well as between enterprises, she said.

Creating regional connections and supply chains from the input to output stages would help better exploit the competitive advantages of each locality in the region, she said.

Prof. Dr. Bui Van Trinh of Can Tho University said that to attract more FDI, the Government needs to complete zoning plans for the region and, based on that, for each locality in there.

The Government should vest authority in the management of key economic regions in general and the southern key economic zone in particular, he said.

Localities need to closely cooperate to spell out objectives and policies for attracting FDI on the basis of the overall regional benefits, he said.

Dr Pham Phu Quoc, General Director of the HCM City Financial Investment Company, said the region needs a total 4,650 quadrillion VND for economic development in 2015-2020.

This means there is an urgent need to frame policies and create mechanisms to attract sufficient resources to develop the entire region, he said.

He also suggested measures to enhance links and attract capital for developing the region.

They included making zoning plans for the region based on its socio-economic needs and developing value chains for the region’s products.

In addition, the Government should concentrate its own resources and mobilise them from all sectors to invest in local socio-economic development, and at the same time have policies and mechanisms to attract all economic sectors to participate in developing the region’s economy, Quoc said.

The workshop’s recommendations will be forwarded to ministries and localities to develop appropriate mechanisms and policies.-VNA