Decision No. 482/QD-TTg dated April 14, 2010 of the Prime Minister promulgating mechanisms and policies to encourage external economic development in the Vietnam-Laos and Vietnam-Cambodia border regions

THE PRIME MINISTER

Decision No. 482/QD-TTg of April 14, 2010, promulgating mechanisms and policies to encourage external economic development in the Vietnam-Laos and Vietnam-Cambodia border regions

THE PRIME MINISTER

Pursuant to the December 25, 2001 Law on Organization of the Government;

At the proposal of the Minister of Planning and Investment in Report No. 2113/BKH-KTDN of April 1, 2010, on the promulgation of mechanisms and policies to encourage external economic development in the Vietnam-Laos and Vietnam-Cambodia border regions,

DECIDES:

Article 1. General provisions

1. Mechanisms and policies to encourage external economic development in the Vietnam-Laos and Vietnam-Cambodia border regions shall be closely associated with defense and security tasks.

2. Vietnam-Laos and Vietnam-Cambodia border regions regulated by this Decision embrace Vietnam’s provinces with their administrative boundaries partially overlapping the land borderlines between Vietnam and Laos and Vietnam and Cambodia (see attached Appendix).

3. The Government shall perform the unified state management of mechanisms and policies to encourage external economic development in the Vietnam-Laos and Vietnam-Cambodia border regions. Ministries, branches and localities shall, based on their functions, tasks and organizational structures, and implement these mechanisms under current regulations.

Article 2. Scope of application

1. The provinces specified in Clause 2, Article 1 of this Decision.

2. Vietnamese enterprises of all economic sectors carrying out investment programs and projects in the provinces listed in the Appendix to this Decision and Lao and Cambodian provinces bordering on Vietnam.

3. Mechanisms and policies to encourage external economic development in the Vietnam-Laos and Vietnam-Cambodia border regions do not apply to industrial parks, export-processing zones, economic zones and border-gate economic zones.

Article 3. Incentive mechanisms and policies

1. Priority will be given to investment with annual funds in support of cooperation with Laos and Cambodia from the central budget and official development assistance (ODA) reserved for Vietnam’s provinces bordering on Laws or Cambodia for:

a/ Supporting the construction of joint-control zones in major and international border gates and road routes in border-gate areas linking major or international border gates with major road routes. Priority will be given to building border patrol roads to facilitate inspection and control and promote economic exchange;

b/ Border market projects that are prioritized for receiving investment capital supports from the state budget. Particularly for border markets in geographical areas with socio-economic difficulties or with extreme socio-economic difficulties, state budget supports will account for 80% and 100% of total construction investment capital/market, respectively;

c/ Trade infrastructure projects in the Vietnam-Laos and Vietnam-Cambodia border regions such as markets, supermarkets, trade centers and commodity preservation storehouses that are eligible for investment incentives and preferences provided in the Government’s Decree No. 108/2006/ND-CP of September 22, 2006, detailing and guiding a number of articles of the Investment Law;

d/ Supporting the procurement of equipment and vehicles for joint-control agencies in border gates to improve their control of imports and exports and fight against security infringements, smuggling and trade fraud;

e/ Building and upgrading physical foundations for Lao and Cambodian students studying at collegial or higher-level training institutions in border provinces which assist in training 30 or more Lao and Cambodian officials and students per year;

f/ In addition to annual budget allocations, providing annual additional supports of VND 2-3 billion from the central budget for each border province for training Lao and Cambodian officials and students or providing material supports for Lao and Cambodian provinces;

g/ Prioritizing and encouraging the implementation of joint military and civil healthcare projects under the national target program on the prevention and control of social diseases and dangerous epidemics; investing in the construction and upgrading of district- and commune-level health stations in districts and communes bordering on Laos and Cambodia and providing proper healthcare for Lao and Cambodian border inhabitants who enter Vietnam for medical examination and treatment;

h/ Prioritizing and encouraging the implementation of projects under the program to control dangerous cattle and poultry epidemics and harmful crop epidemics in the Vietnam-Laos and Vietnam-Cambodia border regions;

i/ Building and upgrading radio and television broadcasting and telecommunications stations suitable to the areas and characteristics of each region in Vietnamese districts and commune clusters bordering on Laos and Cambodia to ensure timely information and propaganda to border inhabitants;

j/ Building a number of residential clusters in areas important to national security in provinces bordering on Laos and Cambodia.

2. Preferences will be provided to enterprises carrying out investment projects mentioned in Clause 2, Article 2 of this Decision when they make investment (offshore investment under the Investment Law) in Lao and Cambodian provinces bordering on Vietnam:

a/ Conditions for enjoying preferences:

- Generating and trading in electricity combined with importing electricity into Vietnam; exploiting and processing oil and gas and rock salt, iron and bauxite ores; planting and processing products from industrial crops; producing import substitutes for domestic production; producing, processing and preserving farm, forest and aquatic products;

- Combining investment cooperation with raising the living standards for border inhabitants and assuring border defense and security.

b/ Preferential policies:

- Being officially introduced by competent Vietnamese state agencies to competent Lao and Cambodian agencies and enjoying some preferential mechanisms and policies in the 2007 Hanoi Agreement signed by Vietnam and Laos on September 14, 2007, and the Agreement on “special preferential mechanisms to facilitate the cross-border movement of people, vehicles and goods to promote trade and investment cooperation in the Development Triangle Area of Vietnam and Cambodia and Laos” signed between Vietnam, Laos and Cambodia on November 26, 2008;

- The State’s investment credit mechanism:

+ Investors shall meet all borrowing conditions under regulations on the State’s investment credits and have equity capital at least equal to 15% of total investment capital of each project eligible for the State’s investment credit loans at the Development Bank. The lending mechanism complies with Decrees No. 151/2006/ND-CP and No. 106/2008/ND-CP;

+ Investment credit interest rates comply with current regulations;

+ Particularly for projects in which investment is decided by the Prime Minister:

(i) Enjoying investment credit guarantee for projects wholly invested by Vietnamese enterprises (Vietnamese investors) under Decree No. 151/2006/ND-CP on the State’s investment credit and export credit;

(ii) Obtaining Ministry of Finance guarantee free of charge for investors to take out domestic and foreign loans for investment in these projects;

+ Loan security and lending evaluation: Loan security complies with current regulations but is exempt from security transaction registration procedures; large-scale capital-intensive special projects in important sectors shall be submitted to the Prime Minister for the latter to permit the Vietnam Development Bank to exempt them from evaluation of financial plans and loan repayment plans, provided that investors commit to fully paying debts (principal and interest) of their projects.

Particularly for mineral survey and exploitation projects, loan guarantee for the State’s investment credits may be provided only in the stage of exploitation and processing.

3. Preferences for enterprises carrying out investment projects in Vietnam’s border gates.

a/ Conditions for enjoying preferences:

- Exporting at least 50% of the production value to Laos or Cambodia; or:

- Importing 100% of principal materials from Laos or Cambodia.

b/ Preferential policies:

- Eligibility for the State’s investment credit mechanisms with the highest levels of loans and guarantee under current regulations;

- Other preferences applicable to investments in geographical areas with extreme socio-economic difficulties according to current regulations

Article 4. Organization of implementation

1. The Ministry of Planning and Investment shall:

a/ Act as the focal point in taking charge of, monitor and urge concerned ministries, branches and localities in, implementing this Decision; and submit to the Prime Minister for consideration and decisions arising matters beyond its competence;

b/ Assume the prime responsibility for, and coordinate with concerned ministries and branches in, introducing Vietnamese investors to Lao and Cambodian sides;

c/ Assume the prime responsibility for, and coordinate with the Ministry of Finance and concerned ministries, branches and localities in, making annual investment plans under current regulations, and drafting documents for submission to the Prime Minister for consideration and decision.

2. The Ministry of Finance shall assume the prime responsibility for, and coordinate with concerned ministries and branches in, specifically guiding regulations on capital borrowing and guarantee and preferential mechanisms and policies related to this Decision.

3. The Ministry of Industry and Trade shall:

Study and supplement mechanisms and policies in the field of industry and trade which comply with the strategy aiming to encourage external economic development in the Vietnam-Laos and Vietnam-Cambodia border regions in close association with defense and security tasks, and actively call for cooperation and investment in the sector’s projects carried out in these regions.

Assume the prime responsibility for, and coordinate with concerned ministries and branches and Lao and Cambodian sides in, formulating a master plan on development of the network of Vietnam-Laos and Vietnam-Cambodia border markets.

4. The Ministry of Transport shall coordinate with localities in evaluating, reviewing, adjusting and improving the master plan on a network of roads in border-gate areas linking major and international border gates with major road routes, and propose construction plans to the Government.

5. The Ministry of Labor, War Invalids and Social Affairs shall coordinate with Lao and Cambodian sides in reaching agreement on labor safety, handling of labor-related violations and labor cooperation between Vietnam and Laos and Vietnam and Cambodia.

6. The Ministry of Foreign Affairs shall:

In pursuance to bilateral treaties and agreements, direct Laos- and Cambodia-based diplomatic missions to take proactive interventions against improper implementation and protect lawful interests of Vietnamese investors.

Direct Laos- and Cambodia-based Vietnamese diplomatic missions and consulates to properly promote socio-political, defense and security relations; boost economic and cultural cooperation between Vietnam and Laos and Cambodia and protect lawful interests of Vietnamese investors and communities in Laos and Cambodia in accordance with the law on diplomatic missions.

Assign Vietnamese diplomatic missions and consulates to supervise, support and promote economic development cooperation in the border regions between Vietnam and Laos and Cambodia; and to take proactive interventions against improper implementation and protect lawful interests of Vietnamese enterprises and citizens.

7.  The Ministry of National Defense and the Ministry of Public Security shall, on the basis of the defense and security strategies in the defense disposition to safeguard the Fatherland, study and advise the Prime Minister in considering and deciding on projects to be implemented within the border regions of the three countries to achieve the objective of external economic development in close association with defense and security tasks.

8. The State Bank of Vietnam shall:

a/ Encourage commercial banks to attend to, and create conditions for related commercial banks to implement these preferential mechanisms and policies;

b/ Coordinate with the Bank of the People’s Democratic Republic of Laos and the National Bank of Cambodia in creating conditions for commercial banks to open branches or enter into joint ventures with Lao and Cambodian commercial banks in opening branches in these two countries with a view to facilitating investment and trade activities of Vietnamese investors in Laos and Cambodia.

9. The People’s Committees of border provinces shall coordinate with ministries and branches and Lao and Cambodian provinces in dealing with related matters; and manage and effectively use central budget supports for proper purposes.

10. The Vietnam Development Bank shall submit to the Prime Minister for consideration and decision preferential mechanisms regarding investment credits for Vietnamese enterprises to invest in Lao or Cambodian provinces bordering on Vietnam.

Article 5. This Decision takes effect on the date of its signing.

Article 6. Implementation provisions

The Minister of Planning and Investment, other ministers, heads of ministerial-level agencies, heads of government-attached agencies and chairpersons of provincial-level People’s Committees shall implement this Decision.-

Prime Minister
NGUYEN TAN DUNG

Appendix

Vietnamese provinces in the Vietnam-Laos and Vietnam-Cambodia border regions

(to the Prime Minister’s Decision No. 482/QD-TTg of April 14, 2010)

1. Dien Bien.

2. Son La.

3. Thanh Hoa.

4. Nghe An.

5. Ha Tinh.

6. Quang Binh.

7. Quang Tri.

8. Thua Thien Hue.

9. Quang Nam.

10. Kon Tum.

11. Gia Lai.

12. Dak Lak.

13. Dak Nong.

14. Binh Phuoc.

15. Tay Ninh.

16. Long An.

17. Dong Thap.

18. An Giang.

19. Kien Giang.-