On the morning of March 16, at the headquarters of the People’s Committee of Quang Nam province, the provincial People’s Committee organized a conference to announce the provincial master plan for the period 2021 – 2030, with a vision to 2050 and kick off the National Biodiversity Recovery Year – Quang Nam 2024.
At the conference, billionaire Tran Ba Duong, Chairman of Thaco Group, shared passionately about what Thaco has achieved and will do in the future to contribute to the development of the province:
Serendipity in Chu Lai
“It can be said that Thaco’s investment is a serendipity when we, at that time, were a very small enterprise called to Quang Nam, while the Chu Lai open economic zone was just a project that carried more of the province’s aspirations for poverty alleviation than actuality.
During the period from 2003 to 2020, we also developed our investment in production in Chu Lai, starting with automobile assembly, then expanding into component production to increase the localization rate and develop logistics, an area that was lacking in the Central region at that time. This was also a determination to integrate in the context of international economic integration, which at that time was the vision until 2018 when the import duties for fully assembled cars from ASEAN countries became zero.
During this period, we have also achieved a result, which is to establish a role and position as a dynamic enterprise of Quang Nam province in particular, and in some sectors, we are also a driving force enterprise such as the automobile industry, mechanical engineering, and supporting industries.
Along with this natural development, we have aimed to ensure the sustainable investment and development of Thaco in Quang Nam.
We realized that although we have invested in ports, systems, the logistics cost here is still 20% higher than at the two ends of the country. To solve this key issue, we have had import goods as components for assembly and export, but we are still lacking in export goods.
From agriculture to solving the logistics problem
From here, with a fortuitous opportunity, we have developed large-scale agricultural production in Laos, Cambodia, and the Central Highlands through the acquisition of Hoang Anh Gia Lai Company.
Up to now, we have formed a production model with large-scale cultivation of tropical fruits such as mango, pomelo, durian, and especially banana and pineapple trees specialized in organic agriculture, large-scale production with mechanization and industrial management throughout the value chain.
With the development of agriculture, by the end of this year, we will have about 1,000 tons of fresh goods to export per day, and next year, it will be about 2,000 tons of fresh fruits per day. So on average, we have from 100 to 200 containers of exports every day. We have also gradually invested in a planned 500,000-ton port, which we expect to complete by May this year.
With the logistics in place, we found that Quang Nam’s master plan included the Cua Lo route with an investment capital of about 6,500 billion VND, we will be determined to participate in the bidding to receive this project through the PPP form.
Besides, along with the road transport system, we will also study to invest in branch routes through the BOT form to focus on the transportation route from Southern Laos, Northern Cambodia, and the Central Highlands to Chu Lai.
So the realization of the master plan announced today, with a vision until 2030 to become the logistics center of the Central region, I believe is very feasible if our Cua Lo route is invested in and completed early.
Along with the possibility of imports and large ships entering, we will be able to solve the logistics cost problem. When logistics costs are low, other investors will come to the Central region in general and Quang Nam in particular.
We expect the logistics center that focuses on containers, which are goods that need to be available every day and that small businesses really need. Therefore, regarding the logistics center plan, I believe we can achieve it.
Thaco’s business plans
Regarding automobiles , we continue to develop every year and currently still lead the market with a market share of about 35-38%. We collaborate with foreign brands and increase the localization rate, so that together with them, we can penetrate the ASEAN market and especially in the near future when the infrastructure develops, and as the Vietnamese economy steadily grows, the car popularization program will be implemented, the automobile industry center will become a reality, but that will only be concentrated in the central region and for Vietnam.
Regarding industrial support engineering, up to now, we have had one mechanical processing assembly complex and 22 industrial plants in supporting industries, and currently, there are a lot of orders. This year, we plan to build 7 new plants for export production, and this year, the export of machinery, equipment, and mechanical components is $350 million, while in the past, I only told the team that we only needed to successfully sell mechanical components worth $1,000.
Regarding civil goods, currently, there are a lot of orders. As for general and industrial support mechanical engineering in the Central region at Chu Lai, we focus on heavy industry, component parts for automobiles, large machinery and equipment, while civil goods will be produced in the South, in Binh Duong.
Regarding the medicinal plant industrial center and agricultural processing production, with an area of 85,000 hectares for industrial production, which is unlimited expansion in the Central Highlands, Southern Laos, and Cambodia, the primary processing will be organized for production there, while refining of agricultural and forestry products will be produced in Chu Lai.
With trends in the near future, even industrial products, for example, fabrics, now people also require a 20% proportion from plants or functional foods and medicinal products, people are returning to traditional values. So our medicinal plants are not just focused on Ngoc Linh ginseng or cinnamon, we will look at a large medicinal plant cultivation area and participate in the value chain for production.
We need companions
We see that for 2003, when I came here, the role was the first enterprise to invest in an open economy with pressure to make the Chu Lai economic zone successful until today, we have achieved that. And with the announcement of the master plan today, we also realize that the role to continue our development according to the plan in the automobile industry, in industrial support mechanical engineering, in the production part of the pharmaceutical and agricultural industries, and especially in the logistics center for container goods in Quang Nam, the Central region, is very feasible.
In a thought of a businessman whose whole life is associated with the development of a locality, associated with the development of a region, and associated with many key industries of the country, that is a very happy thing.
I will be determined to implement this program. At present, the 5-year plan of Thaco Group from 2022 to 2027 has been formulated 3 years ahead of the province’s set goal for each sector.
I also feel that when we invest in industry, it will create a budget, create employment, but it has a smaller impact, which is more vulnerable and easier to hurt people’s lives. I also promise with the experience of working in agriculture, which has fundamentally been successful and seen the model, we will also do agriculture in the Central region.
I want to prove that the Central region, which is stormy and dry, can do agriculture, and it is productive that brings value. I promise to do more of this and combine it with the chain so that farmers and people can participate.
For production and industry, it takes time and requires perseverance. It is different from real estate construction, where a house is built in two years, but to maintain a factory and sell products, there are many other things as well which also take a long time. But we also hope that the businesses in the province will participate with us in supporting industries in the sectors that we are about to develop, so that we don’t carry the burden alone.
Recently, the province has also held many seminars together with Thaco and invited Quang Nam businesses. We have also presented all models, but maybe at that time real estate and other industries were too attractive, so businesses were not enthusiastic enough. We hope that in the future, businesses here will collaborate to form a strong business community whose goal is not only for the economy of the South but for the economy of the Central region, including us.”
