Greater investment incentives are needed to get more industrial zone workers into personal residences.
Vietnam is home to 173 industrial zones (IZs) attracting 1.6 million labourers, 60 per cent of whom are not native to the IZ localities. Only around 20 per cent of the total workers have stable housing while the remainder has to lease houses.
Though the IZ management authorities have made constant efforts to make more IZ workers accessible to stable housing, actual outcomes have fallen below expectations.
The state should present more concrete incentive policies to stimulate firms to pump money into building workers’ housing, said Investment and Industrial Development Corporation deputy general director Bui Van Duc.
According to IZ developers, current legal procedures relevant to planning approval and implementation of worker housing projects are inconsistent. This has cost project developers time and extra expenses to get projects rolling.
Besides, some developers said they were given the land lease decisions, but not the land use right certificates. Therefore they could not access bank loans. Poor tax incentives also discouraged investors from jumping into such housing projects.
Ho Chi Minh City now accommodates 14 IZs and export processing zones with around 220,000 workers. However, only 13,000 labourers have houses, tantamount to 6 per cent of the total.
Ho Chi Minh City IZ and EPZ Authority head Vu Van Hoa had attributed IZs’ poor worker housing to tardy planning.
In northern Vinh Phuc province, the province is currently home to around 230 projects employing over 70,000 labourers, of whom around 48,000 work directly at enterprises.
The provincial authorities have thus far ratified a project on building housings for workers and low-paid people over 4.3 hectares in Vinh Yen city’s Khai Quang ward and similar projects over 12.2ha in Khai Quang IZ and 15ha in Ba Thien IZ. Japan-backed Honda Vietnam reportedly built a living block at a cost of around VND130 billion ($6.3 million) for its 1,800 workers.
Reality shows that after two years governmental Resolution 18/NQ-CP dated April 20, 2009 presenting policies and mechanisms to spur housing development for students, IZ workers and low-paid people in urban areas came into force, localities across the country had registered around 110 worker housing projects with a total registered capital of more than VND25.5 trillion ($1.23 billion), of which over VND24.4 trillion ($1.17 trillion) came from businesses.
However, only 25 projects got off the ground valued at around VND2.8 trillion ($135 million) providing accommodation for 129,000 workers and just nine projects were put into use.