Economic downturn has caused difficulties not only for domestic businesses but also for foreign direct investment (FDI) ones. Khanh Hoa Province has launched some measures to support FDI businesses in the province...
Economic downturn has caused difficulties not only for domestic businesses but also for foreign direct investment (FDI) ones. Khanh Hoa Province has launched some measures to support FDI businesses in the province.
. Businesses in difficult time
Due to many reasons such as production cost increase, week output, decrease in both domestic and international consumption and high lending interest, many FDI businesses in the province have been suffering a lot of difficulties.
Cao Tuan Dung, deputy director of Hyundai Vinashin Shipyard Co., Ltd., said, “Because of the financial crisis and economic downturn, the number of orders have been dropped sharply. Additionally, ship price also has felt deeply, causing losses for ship builder.”
Many other businesses in seafood processing, garment and some other fields also are meeting a lot of difficulties. So far this year, production of FDI businesses in the province has seen a year-on-year decline. The turnover has reached only USD283 million, 3.4% down. The export turnover got USD257 million, 3.3% down.
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| Hyundai Vinashin in lack of ship building contracts |
. Solutions to FDI businesses
To confront the difficulties, many FDI businesses have managed to save themselves such as cutting cost and labor, lowering cost price of products or endeavoring to seek contracts.
To support businesses in the difficult time, Khanh Hoa Province has done many practical actions.
The provincial Department of Planning and Investment has petitioned the provincial People’s Committee to implement solutions for FDI businesses and support the market according to Resolution No.13 of the Government. Specifically, reduction of business income tax, value added tax as well as land rent and excise exemption will be given to businesses of priorities in order to stimulate production and growth. Project investors who are meeting financial difficulties can receive a extension for land use payment by 12 months and be reduced 2012’ land rent by 50%.
Additionally, the department has promoted administrative reform on production, investment, tax and customs to facilitate businesses.
Recently, Vice-chairman of the provincial Standing People’s Committee Tran Son Hai also asked the authorities in the province to submit solutions for FDI businesses in the province.
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