Building infrastructure for industrial clusters in Hanoi

The rapid development of small and medium enterprises and craft villages in rural areas has caused environmental pollution, hindered development and encountered the "bottleneck" of infrastructure. The establishment of industrial clusters is a suitable solution to solve these obstacles in order to promote rural industrial development.

Industrial clusters are a new form of industrial production organization by territory. It was formed and developed after the Government's Decree No. 90/2001/ND-CP dated November 23, 2001 on supporting the development of small and medium enterprises and after Decision No. 132/2000/QD-TTg dated November 24, 2000 on a number of policies to encourage the development of rural industries. Through the survey results of the Industrial CCNLN Development Project VIE01/025 in 2004

-2005 of the Central Institute for Management Research pointed out: by December 2004, the number of industrial clusters built in Hanoi (old) was: 3 Clusters with an area of 96.1 ha, Ha Tay province (old): 21 Clusters with an area of 591 ha, Bac Ninh province: 15 Clusters with an area of 335.7 ha; Nam Dinh province: 15 Clusters with an area of 202.69 ha.

In fact, CCNs are formed and developed from two main paths:

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First: Spontaneous formation, ahead of the socio-economic development planning of the province/city, stemming from the urgent need of households in villages who need larger land areas to develop production, the households build themselves, then develop into industrial clusters. To meet the need to expand production scale, some production and business households in villages that do not have enough production land have exchanged agricultural fields with each other, consolidated fields to have larger land areas and concentrated industrial production in a separate area, changing the land use purpose from agriculture to industry. In response to the urgent need of production households for production land, the local government has allowed the conversion of agricultural land use purpose to industry, forming industrial clusters. In addition, there is another way that in some villages, there are

The production facility pioneered in applying for permission to lease production premises from agricultural land to invest in building production facilities such as Minh Phuong facility in Ha Tay. In response to the urgent need from the reality of production development, although there was no legal basis, the local government agreed to let these production facilities use agricultural land to convert to industrial production very early. From the success of Minh Phuong, gradually many other production facilities also applied to lease premises in that area and eventually formed industrial parks.

Second: The City/Province or District People's Committee plans to build new industrial parks. The City or District has allocated land to build industrial park infrastructure, then divided the land in the industrial park and bid or assigned it to businesses and business establishments to invest in the industrial park.

The formation of industrial parks in the territories must meet the following conditions and criteria:

- In accordance with the planning, plans and socio-economic development situation; land use planning and plans of each locality. The formation and development of industrial parks must be sustainable;

- Included in the approved industrial park development plan;

- Have reserved land for development and conditions to link into industrial parks;

- Ability to achieve an occupancy rate of no less than 30% within one year of establishment;

- There is an investor to build industrial park infrastructure;

- Ensure security and defense requirements;

- Expansion of existing industrial parks can only be carried out when: i) There is a land fund suitable for the district's land use planning, meeting the needs of industrial park expansion; ii) The demand for industrial land lease in the industrial park exceeds the existing industrial land area of the industrial park; iii) The occupancy rate has reached at least 60%; iv) There is a centralized wastewater treatment facility for industrial parks with an area of 15 hectares or more. [47]

1.1.3. The role of Industrial Clusters

From the actual operations of many industrial parks and from the development planning of industrial parks, it can be seen that industrial parks have the following main roles:

(1) Developing industrial clusters contributes positively to the transformation of local economic structure, the implementation of industrialization and modernization of agriculture and rural areas, and the development of local socio-economy. Thanks to larger production areas and better infrastructure such as roads, power supply systems, telecommunications, wastewater treatment stations, etc. than before entering the cluster, industrial clusters have increased production scale and improved production capacity of many small and medium enterprises and many craft villages. Previously, production in craft villages took place in households, both for production and for daily life, so the area was limited, hindering production development and polluting the environment, affecting people's lives. In addition, it is very difficult to consume products in large quantities because the roads in craft villages are narrow and winding (it is difficult for cars to reach each family). Currently, the establishment of industrial parks not only creates conditions for expanding and increasing the scale of production but also separates the production area from the residential area. The establishments participating in the industrial parks will have better operating conditions because they have a larger area than before, so the ability to introduce their products is greater, thereby leading to more favorable conditions when signing product consumption contracts.

(2) Industrial clusters are geographical concentrations of production and business establishments, organizations related to each other in production, in the use of infrastructure and in limiting environmental pollution. Therefore, industrial clusters can be considered as the focal point for internal linkages between industry and services and linking industry with rural areas in the region and locality. Therefore, industrial clusters are the nucleus promoting regional development and local socio-economic development.

(3) Minimize environmental pollution. Thanks to the Industrial Park, there are conditions to apply measures to reduce environmental pollution such as: reserving land to plant trees in the Cluster, building centralized waste treatment facilities and applying measures to reduce environmental pollution such as:

Other measures to reduce environmental pollution. Ninh Hiep Industrial Park (Gia Lam, Hanoi) with an area of 63,138 hectares has reserved 8,277 m2 ( accounting for 13.10% of the area of the Cluster) for planting trees and has a wastewater treatment plant with a capacity of 2,400m3 / day and night; Hapro Industrial Park has reserved 3,656m2 ( accounting for 26.17% of the area of the Cluster) for planting trees and entertainment areas...

(4) Creating conditions to promote scientific and technological progress in production and business of craft villages. The formation of industrial clusters is a shift from scattered, fragmented production to concentrated production, thereby promoting and creating conditions for technological innovation. Thanks to industrial clusters, it is possible to apply technological lines with larger and more modern capacities. In Nguyen Khe industrial cluster (Dong Anh - Hanoi), thanks to a larger area (each small and medium enterprise in this industrial cluster has an area of at least 1 hectare to build a factory) and better infrastructure, 12 small and medium enterprises in different industries (garment, construction materials production, food processing, animal feed processing, assembly...) have all applied advanced scientific and technological advances, applied modern production lines and improved the level of technological equipment of production.

(5) Solving many jobs for rural workers. In industrial clusters, thanks to expanding the scale of production and combining concentrated and decentralized production, it has allowed attracting more workers, solving employment problems, and promoting the division of labor in rural areas. Many production and business establishments in industrial clusters, in addition to solving jobs for local workers, also attract workers from other localities. The development of industrial clusters contributes to improving the quality of life of the community, increasing income for workers, and accelerating the process of industrialization and modernization of agriculture and rural areas.

According to the report of the Hanoi Department of Planning and Investment, the total value of industrial production in industrial zones, clusters and points in 2009 was 75,000 billion VND, the total value paid to the budget was 1,500 billion VND and attracted about 200,000 workers.[60]

(6) Production and business establishments in industrial parks have the opportunity and conditions to increase productivity and reduce costs by taking advantage of their geographical proximity.

Currently, some industrial clusters and the majority of industrial clusters are established and developed on the basis of the value chain of production and product supply. Therefore, industrial clusters have promoted cooperation, linkage and increased the competitiveness of production and business establishments in the cluster. According to Michael Porter, industrial clusters have the potential to impact competition in three ways: i) By increasing the efficiency of enterprises in the cluster; ii) By regulating innovation in the region; iii) By encouraging enterprises in the region.

Michael Porter considered the level of development of Industry Clusters as one of the fundamental factors of competitiveness (Diagram 1.1).

Micro Competitiveness

Level of expertise in corporate strategy and operations

Level of cluster development

Quality of national business environment

Macro competitiveness

Infrastructure x= society and political institutions

Macroeconomic policy quality

Natural advantages

Natural resources

Location

geography

Scale

Figure 1.1. Fundamental elements of competitiveness

Source: [2]

Thus, it can be considered that industrial clusters are the highlight and breakthrough in the current rural industrial development. Therefore, it can be said that the formation and development of industrial clusters is necessary and contributes to accelerating the process of industrialization and modernization of agriculture, rural areas and socio-economic development in the locality.

However, we should not overemphasize the positive aspects of industrial park development. In addition to the positive aspects, we should also consider the negative aspects that have occurred in the development of industrial parks such as: Impact on agricultural production and the lives of suburban farmers; Negative impacts on the environment; Rampant ineffective development of industrial parks, wasting land funds...

1.2. CONCEPT, CHARACTERISTICS AND CRITERIA REFLECTING THE SITUATION OF INDUSTRIAL PARKS' INFRASTRUCTURE CONSTRUCTION

1.2.1. Concept and role of Industrial Cluster infrastructure

The English word Infrastructure is directly composed of two words: i) Infra below, the part below or also known as infrastructure and ii) structrure means structure, structure) is translated as infrastructure or CSHT. There is an author who defines: “Infrastructure is a general concept to refer to roads, railways, hospitals, schools, irrigation systems, water supply, etc. accumulated from investments of the Central and local governments. This concept also includes intangible assets such as capital, human resources, i.e. investments in training the workforce. Infrastructure plays an important role in achieving high economic growth rates and improving the general living standards of a country”. According to this concept, infrastructure is viewed as sectors and fields of the national economy, not only having material and technical conditions (construction systems) created to ensure socio-economic development but also having human, financial, management and training factors and conditions to create and conditions.

material and technical resources and their operation as the basis for socio-economic activities.

The Vietnamese dictionary defines “Infrastructure is the entire system of works such as roads, power lines, water supply, drainage, waste… in relation to the works and houses built in that area. In my understanding, “infrastructure” is specialized works serving production and social life, while “infrastructure” is also works, but built in a certain area that we are talking about, the scope mentioned in “infrastructure” is narrower than “infrastructure”.

Thus, it can be understood that infrastructure is a specific part of the technical infrastructure in the national economy with the basic function and task of ensuring the general conditions necessary for the production and expanded reproduction process to take place normally and continuously. Infrastructure is also defined as the totality of physical, technical and architectural facilities that play a fundamental role for socio-economic activities to take place normally. The entire infrastructure can be divided into many different types based on different criteria. Specifically:

- Based on the economic and social sectors, infrastructure can be divided into: economic infrastructure, social infrastructure and security and defense infrastructure. However, in reality, there are few types of infrastructure that serve only the economy and not social activities and vice versa.

- Based on the classification of the national economy, infrastructure can be divided into: infrastructure in industry, agriculture, transportation, post and telecommunications, construction, financial activities, banking, healthcare, education, culture and society...

- Based on residential areas and territories, infrastructure can be divided into: urban infrastructure: rural infrastructure; marine economic infrastructure, infrastructure in the plains, midlands, mountains, key development areas, major cities...[35]

Infrastructure in each field, each industry, each region includes works that are specific to the activities of the field, industry, region and inter-industry works that ensure the synchronous operation of the entire system. In many research works on infrastructure, authors often divide infrastructure into two basic types: economic infrastructure and social infrastructure.

(1) Economic infrastructure includes technical infrastructure works such as: energy (electricity, coal, oil and gas) serving production and life, transportation works (roads, railways, seaways, rivers, airways, pipelines), post and telecommunications, irrigation works serving agricultural, forestry and fishery production, etc. Economic infrastructure/infrastructure is an important part of the economic system, ensuring the economy develops rapidly, stably, sustainably and is the driving force for faster development, creating conditions to improve people's lives.

(2) Social infrastructure includes housing, scientific facilities, schools, hospitals, cultural and sports facilities, etc. and their synchronous equipment. This is an essential condition to serve and improve the living standards of the community, and to train and develop human resources in accordance with the process of industrialization and modernization of the country. Thus, social infrastructure is a collection of industries with social service characteristics; the products they create are expressed in the form of services and are often public in nature, related to human development both physically and mentally.

Building infrastructure for industrial clusters in Hanoi - 5

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