Danang Silicon Valley project stays in limbo
In spite of being taken over by the domestic investor after the withdrawal of its foreign investors, the fate of $278-million Danang Information Technology Park (IT park) remains uncertain.
The project was invested by US and Japanese groups Rocky Lai & Associates and KDDI. Accordingly, Rocky Lai & Associates was to be in charge of technical infrastructure and KDDI would have developed the IT infrastructure. The two investors established Danang Information Technology Park Development Co., Ltd. (DITP) to develop the project.
The construction was divided into two phases, the first phase was kicked off in April 2013 and expected to complete in 2017. The second phase would be taken from 2017 to 2023.
The IT park was designed with six functional areas: a production area, an area for research and development and training-consulting, an office area, an area for technical infrastructure, an area for product exhibition, and one for healthcare services, supermarkets, and a school.
The project would have followed the model of the Silicon Valley in the US and Hshinchu Science Park in Taiwan. It expected to lure foreign scientists, engineers, and IT and hi-tech specialists into Danang, and encourage hi-tech training at universities. In addition, the investors hoped the IT park would attract investors from around the world, including the US, Japan, South Korea, Taiwan, and India.
However, after three years of the ground breaking, the project remained immobile. In addition, despite Danang spending over VND100 billion ($4.48 million) on site clearance, DITP had yet to pay land rent, taxes as well as other fees. As a result, the Danang Taxation Department was forced to freeze the investors’ bank account.
The Danang People’s Committee warned that if DITP failed to pay the advance payment to the city’s fund, along with a fine of VND10 billion ($448.194) for the delay, before June 30, 2015, DITP would have its investment certificate revoked.
In March 2015, DITP announced to withdraw from the project due to lack of finances.
In July 2015, when the city decided to revoke the project certificate, Trung Nam Land JSC (Trung Nam) expressed interest in paying DITP’s debts to the city to take over the project in partnership with Trung Nam Construction & Engineering Corporation (Trung Nam E&C).
The Danang People’s Committee approved in principle to license Trung Nam to develop the project, however, it requested the company to pay the shouldered debts and implement the project on schedule, as it committed to, evidence of which would be submitted to the Danang People’s Council in August 2016 for approval.
However, in early 2016, Trung Nam E&C and Trung Nam Land started to implement the construction of the technical infrastructure without receiving the comments of the Danang People’s Council.
VIR’s reporter contacted the representatives of both companies to verify the reason for the discretionary start of project implementation, however, neither of the two companies came out with a comment.
Source: VIR
