The unity and contradiction in the development of the industrial zones and new rural areas: From practice to the role of the state

Nội dung text: The unity and contradiction in the development of the industrial zones and new rural areas: From practice to the role of the state

1. THE UNITY AND CONTRADICTION IN THE DEVELOPMENT OF THE INDUSTRIAL ZONES AND NEW RURAL AREAS: FROM PRACTICE TO THE ROLE OF THE STATE Dr. Nguyen Thi Hao haonguyen1841976@gmail.com Dr. Le Ngọc Thong thongleh@yahoo.com Department of Political Theory National Economics University, Hanoi, Vietnam Summary By the appropriate scientific method, the article has contributed to complete the theory of the development of the industrial zones and new rural areas. From there, analyze the unified and contradictory relationship between these two processes. At the same time, the article shows the need for a state intervention role. Thereby, the article proposes some corresponding solutions Key words: industrial zones, new rural, the role of the state, 1. Introduction The 10th Congress of the Communist Party of Vietnam affirmed that “For now and for many years to come, the issue of agriculture, farmers and rural areas is particularly important” is a strategic issue in the process of socio-economic development, contributing to promoting economic growth, serving as a basis for political stability and security and defense; is an important factor to ensure the sustainable development of the country in the process of industrialization and modernization in the direction of socialism. It is also the process of building new rural areas (NRA) with the development of industrial zones (IZs) nationwide. That should be studied in both theoretical and practical terms. 2. Targets, methods 2.1. Target (1) Contribute to improve the theory of the development of IZs and NRA (2) Analyze the unified and conflicting relationship between the two processes. (3) Indicate the need for the intervention role of the state and propose some corresponding solutions. 306
2. 2.2. Methods The article uses a combination of appropriate methods: qualitative research incorporates some of the quantitative research; unity between history and logic; between analysis and synthesis; between specific and abstract, to achieve the goal 3. Results 3.1. Development process of IZs and NRA 3.1.1. Development of IZs In each country, the IZs has different economic activities and names. The Government’s Decree No. 29/2008/ND-CP dated March 14th, 2008 stipulates that: The IZs is specialized in producing industrial goods and provides services for industrial production with defined geographical boundaries, to be established according to the conditions, order and procedures prescribed by the Government. IZs is a specific object of state management. The IZs is formed and developed in association with the renovation of the country. In the early 1990s in the 20th century, the policy of developing IZs was promulgated. Starting by the estabishment of Tan Thuan Export Processing Zone in 1991. The model of the IZs has achieved important achievements, contributing positively to the cause of industrialization and modernization of the country: attracting investment capital in the country and abroad to develop the economy; boosting exports, increasing revenues and reducing foreign exchange spending and contributing to increasing budget revenues; receiving advanced technics and technologies, modern management methods and stimulating the development of supporting industries and enterprises in the country; creating jobs, reduce poverty and development of human resources; promoting the modernization of the infrastructure system and the nucleus for the formation of a new urban center; development of IZs in association with environmental protection. The development of the IZs is concerned by the whole society, with the good situation. Table 1. Status of the development of IZs 1 (TL5) Overall Allocation Number of South Num South Red River Natura IZs has come ber of West Num Rent Occup East Area Delta l area into operation Izs is Area ber able ancy (thous being of Area Rate Num Occup Num % Num % Num % and land IZs (%) (%) ber ancy ber ber ber ha) of Rate cleara of of of IZs % nce IZs IZs IZs 325 94,9 67 51 220 73 105 111 34 85 26 52 16 1 Based on Department of Management of Economic Zones, Ministry of Planning and Investment (2017), “Summary data of activities situation in the IZs in the whole country,” Hanoi. 307
3. Table 2. Attract investment capital into IZs at the end of 20162 (TL5) FDI - Foreign Direct Investment Domestic Direct investment Total Total registered Performing Number Performing Number registered investment investment of investment of investment (thousand (thousand billion projects (Billion USD) projects (Billion USD) billion dongs) dongs) Quantity Rate % Quantity Rate % 7.013 111,4 67 61 6.504 710,6 358 51 Table 3. Production achievements of IZs in 20163 Total revenue Export Import Payment to budget (billion USD) (billion USD) (billion USD) (thousand billion dongs) Compare Compare Compare Compare Achieved Achieved Achieved Achieved to 2015 (%) to 2015 (%) to 2015 (%) to 2015 (%) 145,5 109 96 108 94 107 110 106 In general, the IZs increasingly plays an important role in the socio-economic development of the locality and the whole country Each IZ has an infrastructure system which is relatively synchronous and has a long term value, contributing to the modernization of the infrastructure system throughout the country and increasingly showing an important role in the socio- economic development of localities and the whole country in general. The total number of accumulated employees in IZs, CUs as of 7/2016 is over 3 million laborers4. The operation of the IZ has contributed greatly to the growth of the whole industry, as a motive force for the development of enterprises in the province as well as an important contribution to local growth and exports. In the industrial zone, on average 1 hectare of industrial land generates 4.62 million USD in export turnover, higher than the national average (2.12 million USD per hectare). 2 As above Department of Management of Economic Zones, Ministry of Planning and Investment (2017), “Summary data of activities situation in the IZs in the whole country,” Hanoi 3 Report of the Department of Management of Economic Zones of the Ministry of Planning and Investment in 2017 4 PV. “Industrial parks and economic zones contribute to the economic restructuring”, Posted on: kinh-te-88038.html, ngày16/08/2016 308
4. The IZs have contributed to the training of human resources, job creation, raising incomes and qualifications of laborers, contributing to increasing local budget revenues. The IZs have a spillover effect on industrial services activities, financial – banking services, transportation, post and telecommunication, speeding up urbanization, creating equal development among regions and completing the local socio-economic infrastructure. Particularly in Hanoi, IZs in Quarter 1/2017, the total number of employees working in industrial zones was 144.968 people. In Bac Ninh, in 2017, industrial zones create jobs for 285.000 workers. 3.1.2. The process of the development of NRA The national target program for new rural development is a comprehensive rural development program, covering a wide range contents related to the fields of economic, culture, sociality and environment, basis political system and the social security and order in the countryside; to build modern socio-economic infrastructure in rural areas; to build economic structure and rational organization of production; linking agriculture with fast-growing industry and services; Criteria for recognizing new rural communes (19): planning, transportation, irrigation, electricity, schools, cultural facilities, rural markets, post offices, residential housing, incomes, poor households, regular employment rate, organization form of production, education, health, culture, environment, strong social and political system, social security and order. By the end of 2017, the whole country has 3.069 communes (accounting for 34.4% of the total number of communes in the country, while the target for 2017 is 31%) is recognized as standard NRA. In which, 492 communes have met the standard under Department of national criteria for NRA communes in the period 2016 - 2020. Currently, there are 113 communes under 5 criteria in the country. There are 43 district-level units in 24 provinces/cities under central met the NRA standard5. In particular, localities have developed about 21.000 new advanced production models: developing clean agricultural production under the link chain; application of economical and efficient irrigation system; trade village, flower village associated with ecotourism, homestay; linking with plants of medicinal and high value winter crops 5 Ministry of Planning and Investment, "Report of the Ministry of Planning and Investment on the results of the implementation of the two National Targeted Programs for NRA Development and Sustainable Poverty Reduction in 2017” 309
5. 3.2. The unified and contradictory relationship between the development of IZs and NRA 3.2.1. The Unity 3.2.1.1. Rural areas are the main areas of industrial zones. In Vietnam, rural areas are a necessary and sufficient condition for IZs development. The success of NRA is favorable condition for the development of IZs 3.2.1.2. Positive impacts from IZ development to NRA building. (i) The contribution of the IZs to the growth of rural economic, local economy, directly or indirectly contributes to the implementation of 11 contents of building of NRA. (ii) IZs are a great motivation of industrial production and local exports. In 2008, in Hanoi, was 1.624 million USD accounted for 26.5% and in Quang Ninh was 136 million USD, accounted for 45.8% The IZs contributed to the local economy by land use unit, each hectare of IZs land brought higher industrial production value (over 3 million USD in Vinh Phuc and 737 thousand USD in Quang Ninh). (iii) The development of IZs in the regions and areas is accelerating the speed of urbanization and modernization of infrastructure in and outside the IZs or the formation of new urban areas in locality. The infrastructure of the IZs has been improved; stimulating local economic development, increasing the demand for auxiliary services, contributing to develop business activities for business and services establishments in the region. The IZ attracts new investment and creates favorable conditions for businesses to expand their businesses, increase their production capacity and competition, or move out of densely populated areas, helping localities solve their pollution and environmental problems, to regenerate and form new land funds, to form social infrastructures in service of the laborers’ and inhabitants’ lives such as dwelling houses, schools and hospitals . (iv) IZs contribute to the economic restructuring of the locality. IZs have contributed greatly to increasing the proportion of industries and services, reducing the proportion of agriculture in the country in general, and in the localities with IZs. For example 310
6. Table 4. The change in the Northern key economic region 6 No. Fields/year 2000 2005 2009 1 Industry 37,1% 42,2% 44,4% 2 Agriculture 17,8 % 12,6% 10,0 % 3 Service 45,1 % 45,2% 45,6% This confirms that: the contribution of IZs to local economic development is quite positive and effective. There are many other positive effects to be appreciated. The development of IZs should be simultaneous and linked to the NRA development process. Investment in IZs should be considered as the main investment for rural development, essentially, rural industrialization. That is only effective when there is intervention by the State. In fact, on June 4th, 2010, the Government issued Decree No. 61/2010/ND-CP on policies to encourage enterprises to invest in agriculture and rural areas with many conditions and incentives for: land, investment support, human resources training. 3.2.2. Contradiction - negative impact. Negative impact is also quite serious, requiring careful consideration. 3.2.2.1. Negative impacts (i) Land loss of the laborers and employment are relatively small, with a growing trend Table 5. Examples in Hung Yen until the end of 20087 Van My Yen Van Criteria Total Lam Hao My giang 1. Laborers have to relocate for the 29.759 9.400 5.593 5.735 10.705 development of IZs 2. Number of employees has been 12.645 5.782 3.889 2.608 1.962 solved employment problems 3. Number of employees working 8.500 2.683 1.898 1.670 300 in the IZs 4. Number of employees has not 17.114 3.618 1.740 3.127 8.788 been solved employment problems 5.Unemployed rate (%) 42,5 61,5 69,5 45,5 18,3 6. The rate of relocated laborers 28,6 28,5 33,9 29,1 2,8 working in the IZ (%) 6 Based on Coordination Division for Key Economic Zones, MPI (2009), “Socio-economic data of key economic regions nationwide”, 2009, Hanoi. 7 Based on Hoang Ha, Ngo Thang Loi, Vu Thanh Huong and some other authors (2009), “Solutions for settlement of employment, residential housing, ensuring life for employees to develop IZs in Hung Yen province in the process of industrialization and modernization” ", Labor Publishing House, Hanoi. 311
7. The number of laborers who lost land for the communes’ IZs was 42.5%; who working in Izs accounted for 28.6% (8.500 people), accounted for 70% of the total number of laborers has been solved employment problems and 65% of the total number of employees working in the IZs. (ii) Localities have more complex IZs, the security order decreases. Due to the IZ attracts a lot of laborers, the scale of population increases dramatically; some workers are also objected to the search for the law; residential place, complex accommodation, lacking of management needed. Some local people lose their land and unemployment leading to theft, social evils The sociological Investigation in Hung Yen, the respondents affirm the stable local security situation is 41% and good is 46%. In which, Yen My, Kim Dong, Hung Yen Commune and An Thi have the results of 50% (iii) Underlying the danger of insecurity, un-orderly due to strikes, protests, conflicts with employers, (Source from document 2); v.v 3.2.2.2. Causes of the above symptoms (i) The rapid development of IZs exceeds the forecast, making the policies quickly obsolete. The amendment and supplementation of new mechanisms and policies for IZs have not yet been regularly implemented; The specification and implementation of guidelines and policies on IZs development is slow and lack of synchronism between sectors and levels. (ii) Planning work is less predictable and lack of actual survey. (iii) Links between central and local; between the state agencies managing the development of IZs and NRA in the process of developing and implementing the loose policy on related issues; There is no coordination mechanism between the two parties. (iv) There is no mechanism to control the power of the relevant authorities. (v) The very basic reason is that the role of state intervention in these processes has not been seriously and properly implemented. 3.3. The role of the State in solving the relationship between the development of IZs and NRA 3.3.1. State management system in the development of IZs & NRA 3.3.1.1. State management system in the development of IZs Decision No.99/2000/QĐ- TTg dated August 17th 2000 of the Prime Minister, transfer functions of the Vietnam Industrial Zones Authority to the Ministry of Planning and Investment and Decree No.36/CP dated April 24th 1997 of the Government and other legal documents stipulating the State management operation structure for IZs. (See the picture below) 312
8. Source: self-built authors Diagram 1. Diagram of state management structure for development of IZs 3.3.1.2. State management system in the development of NRA Decision No. 800/QD-TTg dated June 04th 2010 of the Prime Minister and other legal documents stipulating: State management agencies to implement the contents of development of NRA including the Ministry of Agriculture and Rural Development to assume the prime responsibility and coordinate with the ministries and the provincial, district and commune People's Committees. (See the picture below) Source: self-built authors Diagram 2. Diagram of state management structure for development of NRA 313
9. As a result, state agencies at all levels are the ones managing both above mentioned processes. Therefore, in the management and administration of these agencies, there should be a harmonious combination of activities in order to create conditions on the social legal basis to benefit both the process. The role of the state in managing this relationship including: building the infrastructure; Training labor resources; improving the administrative procedures; Inspection and supervision 3.3.2. Solutions to promote the role of the State 3.3.2.1. Direction Opinion (i) Development of IZs and NRA and in the spirit of sustainable development for the benefit of the country (ii) Policies for development of IZs and NRA to promote advantages and support for each other, limit the direction of adverse effects. 3.3.2.2. Solution System (i) Solutions need to be implemented immediately: a. Strengthening linkages between agricultural and industrial enterprises and develop local support industries. b. Completing training and employment policies for local IZs. c. Improving both the quality of life and the spirit of workers in IZs and local people; combining cultural exchanges and other activities, promoting the role of cultural spread from IZ to NRA and vice versa (ii) Long term solution a. Establish mechanisms and laws for linking and coordination of activities in both processes, firstly from the activities of the Management Board of the Industrial Zones and the State management unit in the development of NRA. b. Establish mechanisms and laws to coordinate benefits, and control power with affiliated agencies d. Actively improve the rule of law state of tectonic state c. Planning IZs towards models of ecological and park IZs. Consider Izs as embryo germs to form future urban and smart metropolitan areas when IZs have run out of historical missions. 314
10. Discussion and Conclusion: In the above article, we have only realized the task of discovering and raising a problem that is still under discussion from both theory and practice in the process of development of the IZs and NRA. In which, the state intervention on the one hand is to prevent, limit the harm caused by the above processes, on the other hand to intervene to support these two processes. By that, the country is strong in the spirit of “rich people, strong country” % References 1. Coordination Division for Key Economic Zones, MPI (2009), “Socio-economic data of key economic regions nationwide”, 2009, Hanoi. 2. Hoang Ha, Ngo Thang Loi, Vu Thanh Huong and some other authors (2009), “Solutions for settlement of employment, residential housing, ensuring life for employees to develop IZs in Hung Yen province in the process of industrialization and modernization” ", Labor Publishing House, Hanoi. 3. Le Du Phong (2006), “Status on income, life and employment of people whose land is recovered for the construction of IZs, urban areas, construction of socio- economic infrastructure, public needs and national interests, independent state level”, Hanoi 4. Vu Thanh Huong (2010), “Development of the industrial zones in the Northern key economic region along the direction of sustainable development,” LA Economic Department, 2010, Hanoi 5. Department of Management of Economic Zones, Ministry of Planning and Investment (2017), “Summary data of activities situation in the IZs in the whole country,” Hanoi. 315