Quang Tri, Savannakhet discuss plan to build Lao Bao – Densavan cross-border economic zone

The Quang Tri’s authorities today [March 15] and the Provincial People’s Committee of Savannakhet (Laos) jointly organized a seminar titled "Cross-Border Economic Trade Zone of Lao Bao - Densavan: From Concept to Reality."

Overview of the seminar. Photo: Tran Tuyen

Seeking public opinion on the plan

The Special Economic Trade Zone (SETZ) Lao Bao was established according to Decision No. 219/1998/QĐ-TTg dated November 12, 1998 by the Prime Minister of Vietnam, initially named as the area to encourage economic and commercial development of Lao Bao, applying special incentive policies to promote the economic and social development of the border area between Lao Bao and Densavan.

Over the years, thanks to the attention and support from the Party Central Committee, Government, central ministries, sectors, the efforts of the Party Committee, government, and people of Quang Tri, and the contribution of business communities both inside and outside the province, Quang Tri has gradually realized its potential and advantages, concentrating on mobilizing and effectively utilizing all resources for investment in developing the Lao Bao SETZ, contributing to shaping the landscape of the border urban area and contributing to the development of Quang Tri province as well as the East-West Economic Corridor towards Vietnam.

Chairman of Quang Tri People’s Committee Vo van Hung. Photo: Tran Tuyen

However, up to now, due to various reasons, the Lao Bao SETZ has not developed as expected; there are limitations and shortcomings regarding policy mechanisms that need to be overcome, creating new momentum for the development of the Lao Bao - Densavan area in line with the current context and situation.

In his opening speech at the seminar, Vo Van Hung, Deputy Secretary of the Provincial Party Committee and Chairman of the People’s Committee of Quang Tri province, emphasized that the Lao Bao SETZ, as well as the Densavan Border Trade Zone, was established based on the advantages of the region, the policy direction of the Communist Party of Vietnam and the Lao People’s Revolutionary Party since 1997, namely to build the “Lao Bao - Densavan Free Trade Area”.

In implementing the high-level leadership direction of the two countries, Quang Tri province has coordinated with Savannakhet province to develop the pilot project “Building the Cross-Border Economic Trade Zone of Lao Bao - Densavan” to advise the central ministries, sectors, and governments of both countries to implement this important direction.

Both sides hope that when the Cross-Border Economic Trade Zone of Lao Bao - Densavan begins operation, it will be highly feasible, suitable for the practical situation, and truly attractive to businesses for investment and business operations in this promising area.

"To ensure the early operation and effective activities of the Cross-Border Economic Trade Zone of Lao Bao - Densavan, Quang Tri province has determined that, besides coordinating with Savannakhet province to study and establish policy mechanisms, legal corridors, it must also simultaneously adjust the planning of the Lao Bao SETZ. Coordination with Savannakhet province to adjust the planning of the Densavan Border Trade Zone to align with the new development direction and actively promote and attract businesses to invest, especially in transportation infrastructure, technical infrastructure in the Lao Bao SETZ and the Densavan Border Trade Zone," emphasized Hung.

Representative of the Savannakhet province. Photo: Tran Tuyen

Affirming the importance of establishing the Densavan - Lao Bao Cross-Border Economic Trade Zone, the Deputy Provincial Governor of Savannakhet emphasized that the provincial government is ready to support and cooperate to officially establish the aforementioned economic zone.

Furthermore, it was emphasized that the establishment of the cross-border economic trade zone will become a symbol of cooperation between Laos and Vietnam, enhancing and strengthening the friendship and solidarity between Savannakhet province and Quang Tri province. It is an important prerequisite to encourage and promote economic, commercial, investment, and socio-economic development cooperation.

Overview of the seminar. Photo: Tran Tuyen

Exploring the project feasibility

During the seminar, Professor Tran Dinh Thien from the Vietnam Institute of Economics emphasized that after a period of development lacking substance, and experiencing ups and downs, the Special National-Level Border Economic Zone, with the highest level of incentives and support that a country can provide, requires a new approach and solution orientation to build the Densavan - Lao Bao Cross-Border Economic Trade Zone as a new fundamental development model, which is necessary and essential.

Prof. Dr. Tran Dinh Thien. Photo: Tran Tuyen

It is necessary to develop a comprehensive program for the construction and development of the cross-border economic trade zone, including projects to develop centers and other strategic priority coordinates such as airports, seaports, and the urban area of Dông Ha.

Ensure similarity in terms of level, structure, and connectivity of the “cross-border” mechanism between the two parts of the economic zone.

Regarding the operating mechanism of the Lao Bao - Densavan Cross-Border Economic Trade Zone, it is necessary to aim for a new type of “free trade zone” model to define specific tasks.

Dr. Tran Anh Tuan, Chairman of the Vietnam Association of Administrative Sciences, former Deputy Minister of the Ministry of Home Affairs, suggested that in terms of policies for the shared economic trade zone, attention should be paid to the fact that the State has policies to encourage and create favorable conditions to attract investment in priority sectors of development of the economic trade zone, building the economic trade zone towards green - knowledge - sustainability, applying advanced management methods, forming a civilized, modern, high-quality living environment; ensuring social security, maintaining political and social stability in the economic trade zone.

Regarding support mechanisms and policies for businesses, a representative from Hoanh Son Group proposed that continued research be conducted to apply the “one-stop, one-stop inspection” model with new, simplified customs procedures and inspection, control of goods and transportation means to maximize favorable conditions for international trade activities, import-export, and information connectivity between functional departments in the border area.

Dr. Tran Du Lich. Photo: Tran Tuyen

It is recommended that the Governments of Vietnam and Laos, as well as the authorities of Savannakhet and Salavan provinces, pay attention to investing in and upgrading the road from Taoi town to Ban Dong, connecting National Highway 15B with National Highway 9 (in Laos) as this will be a particularly important and convenient transportation route for transporting coal and other goods from the provinces of Southern Laos to Vietnamese seaports. The Vietnamese Government and Quang Trị province are interested in investing in the highway from Cam Lo to Lao Bao to meet the increasing demand for transportation of goods in the coming years.

Dr. Tran Anh Tuan. Photo: Tran Tuyen

Major findings

Summarizing the seminar, the Deputy Permanent Chairman of the Provincial People’s Committee of Ha Sy Dong expressed gratitude and acknowledged the insightful and valuable contributions of the delegates at the seminar as well as the submissions received.

The submissions and opinions sent to the seminar have adequately and comprehensively addressed the required topics, focusing on analyzing, clarifying, and achieving consensus on several key points: Affirming the pilot policy of constructing the Densavan - Lao Bao Cross-Border Economic Trade Zone as the correct policy direction of the high-level leadership of Vietnam and Laos, with expectations that the new cooperation model between the two countries will create a new development space with a cross-border nature commensurate with the special friendly relations between the two parties and peoples of Vietnam and Laos.

The model of the cross-border economic trade zone, the free trade zone, which has not yet been implemented in Vietnam but has been widely deployed in many countries worldwide and has proven effective in practice. The “common” regulations on simplification, harmonization of policies and procedures to meet the common standards of international trade ensure balance with the legal requirements of each country.

In the context of globalization, it is necessary to apply pilot models of cross-border economic trade zones, free trade zones in Vietnam to provide a basis for expansion. However, to implement this, adjustments are needed, and policies and regulations must be issued to synchronize certain legal provisions between Vietnam and Laos, which is a new and challenging issue but has been endorsed by the two countries' Party Central Committees and Governments.

Vice Chairman of the Quang Tri People’s Committee Tran Sy Dong and delegates. Photo: Tran Tuyen

The operational mechanism system needs to aim for a standard institutional system for free trade zones with international standards. Quang Tri province needs to closely coordinate with localities that are researching and developing free trade zones like Haiphong, Danang, referring to the pilot mechanisms of other localities (Hanoi, Ho Chi Minh City, Thanh Hoa, Nghe An) to propose preferential mechanisms applicable to the shared cross-border economic trade zone.

At the seminar, leaders of Quang Tri and Savannakhet provinces agreed to propose relevant ministries and agencies of the two countries to advise the Governments of Vietnam and Laos to sign an agreement on the pilot construction of the Densavan - Lao Bao Cross-Border Economic Trade Zone as a legal basis for Quang Tri province and Savannakhet province to establish coordinated regulations for the management and operation of the shared cross-border economic trade zone.

Thanh Truc - Ngoc Mai