Northern Key Economic Zone accelerates growth pace
10:57 | 24/06/2019

VGP – Socio-economic statistics showed that the northern key economic region has been accelerating its growth pace toward higher level ahead of schedule. 

PM Nguyen Xuan Phuc and his Deputy PMs will chair a conference on Northern Key Economic Region Development on June 25 in Hung Yen province. 

The Ministry of Planning and Investment reported that in the 2016-2018 period, the Northern Key Economic Zone has made big leap forwards, holding high proportions in the four key economic zones. 

In the 2016-2018 period, the region's GRDP grew 9.08% which is the highest level in the four zones. 

However, GRDP of the Northern Key Economic Zone  accounted for 31.73% of the country’s total one and ranked second after the Southern Key Economic Zone (with 45.42%). Especially, Ha Noi took the lead by contributing 16.96% of GRDP. 

GRDP per capita grew from US$ 4,164 in 2016 to US$ 4,813 in 2018, 1.86 times higher than the national average rate. By 2020, the Zone will strive for US$ 5,500. 

Impressive industry production index

Economic structure has shifted positively in combination with the transformation of the growth modal. Agro-forestry-fishery sector contributed the least proportions of GRDP in comparison with that of other zones. Meanwhile, the service sector had the highest density in GRDP. 

In some localities, the service sector occupied high proportions, like in Ha Noi with 64%, the highest rate and Hai Phong with 44.05%. 

Industrial and construction sector played as a pillar for growth especially in Bac Ninh, Ha Noi, and Hai Phong. The sector contributed nearly 40% of national GDP and focused on key spearheads including electricity, electronics, automobile assembling, ship building, garments and textiles, and auxiliary industry. 

Industrial production index was impressive especially Hai Phong with 25.01%. 

Service sector saw the sharpest growth rate in the economic structure. By 2017, it contributed 3.73 percentage points. 

The zone houses 27 logistics centers, accounting for 55% of the total,  including 14 in Bac Binh, 11 in Ha Noi, and two in Hai Phong. 

In the reviewed period, export growth rate hit 25.6%, making up 32% of the national figure. 

In the 2016-2020 period, export turnover is expected to grow 57% from US$ 49.6 billion in 2016 to US$ 78.1 billion in 2018, much higher than the national average rate of 38%. 

Meanwhile, import turnover surged by 44.9% from US$ 61.8 billion in 2016 to US$ 89.5 billion in 2018, higher than the national average rate of 35.5%. 

Other bright points

The agricultural restructuring process has been accelerated in combination with new rural area building. By late 2018, 936 out of 1,217 communes met new rural area standards. The fulfillment rate was 78.91%, which was the highest rate out of the four key economic zones, much higher than the national average rate of 46.48%. 

In the 2016-2018 period, total state budget collection met or even exceed forecast. 

The business investment environment was improved significantly. The number of enterprises picked up sharply from 146,377 in 2016 to 204,310 in 2018, accounting for 28.6% of operational businesses. 

FDI attraction ranked second by absorbing US$ 32.1 billion. Last year, Ha Noi attracted US$ 7.5 billion in which 640 projects were licensed with over US$ 5 billion. 

Total development capital hit VND 1.593 trillion, making up 29.76% of total national investment. 

Meanwhile, the sectors of healthcare, education, environmental protection and social affairs  received due attraction. 

Limited high-tech development

However, there are shortcomings and difficulties in socio-economic development. Specifically, the service sector is serving as a spearhead one but growth rate is unsustainable. 

All seven provinces and cities have planned to develop industries, electronics, and hardware. However, Ha Noi, Hai Phong and Bac Ninh succeeded in attracting foreign big groups including Samsung, LG, Microsoft, and Canon. 

In the 2016-2018 period, the zone gained a total trade export of US$ 426.4 billion. However, the zone failed to contribute to national trade balance (US$ 10.69) billion. On the other hand, the zone suffered a trade deficit of US$ 40.7 billion. In addition, export growth is unsustainable dropping from 31.2% in 2017 to 20% in 2018. 

In some localities, provincial competitive index (PCI) and Provincial Governance and Public Administration Performance Index (PAPI) were at low average, requiring more institutional reform in favor of a better business and investment environment. 

Moreover, the zone is struggling against  other issues namely budget collection, population, immigration, environmental protection, and natural resource saving./.  

By Kim Anh 

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