On August 30, Minister of Industry and Trade Nguyen Hong Dien worked with the leaders of Lao Cai province on the situation of industrial production, commercial activities, and the implementation of national planning in the fields of energy and minerals in the area.
BORDER GATE ECONOMY IS HEAVILY RELIANT ON CHINA
At the meeting, Minister Nguyen Hong Dien assessed that Lao Cai, a border province, is considered the “bulwark of the nation.” Located in the central region of the northern midlands and mountains and belonging to two large economic corridors, Lao Cai is the gateway connecting Vietnam and ASEAN countries with China. This highlights its critical geo-economic, geopolitical, and geo-defense position.
Lao Cai is also known for its “headwater rivers and highest mountains,” featuring well-known tourist destinations like Sa Pa, Fansipan peak, and Bac Ha. In the future, it will have three major international border gates (currently, there is one international border gate, Kim Thanh, and two more are in the planning stage). The province boasts developing multimodal transportation infrastructure, including road, rail, water, and air travel. It is also rich in mineral resources with various high-quality and high-reserve minerals such as apatite, iron, and copper.
“Lao Cai has favorable conditions and converges sufficient potential and advantages to become a growth pole for the region and the country, especially in the development of clean energy, mining and mineral processing industries, border gate economy, commodity trading, logistics services, and ecological, resort, and cultural tourism,” emphasized the Minister of Industry and Trade.
According to Minister Dien, in the past, Lao Cai province has effectively utilized its potential and strengths. The industry and trade and service sectors account for nearly 80% of the province’s GRDP. Export turnover has increased spectacularly, doubling (while the country’s increase was 15.7%); import turnover increased by 50% (the country’s increase was 18.5%).
“Thus, the imports are not only for Lao Cai but also for the whole country. This shows that the raw materials for production and export to the world through this border gate are increasing, which is a very positive sign,” affirmed the Minister of Industry and Trade.
However, the Minister also frankly pointed out that alongside the achievements, there are limitations and weaknesses in the province’s industry and trade sector that need to be addressed.
Although industrial production has achieved a fairly high growth rate, it is not yet sustainable, especially with slow technological innovation. The internal structure of the industry is imbalanced (the proportion of processing industry is low, while the proportion of extractive industry is high; extraction has a small added value, and environmental issues are also challenging).
Moreover, the border gate economy and import-export activities are heavily dependent on the Chinese market and have not expanded to other markets. Businesses have limitedly taken advantage of market opening opportunities from free trade agreements, especially the new-generation FTAs to which Vietnam is a signatory.
The domestic market has low purchasing power (partly due to the small population size, of which about 66% are ethnic minorities). The distribution system and commercial infrastructure are not developing synchronously and are still limited in scale.
STIMULATING LOCAL POTENTIAL
Highly valuing the vision and planning of Lao Cai for its future development orientation, the Ministry of Industry and Trade basically agreed with the tasks and solutions proposed by the locality. The philosophy of “1 axis, 2 poles, 3 regions, 4 pillars, and 5 solutions” is worth referring to.
From the perspective of the industry and trade sector, Minister Nguyen Hong Dien shared that the provincial planning of Lao Cai was approved quite early compared to other localities (March 2023). However, the Regional Planning was only approved in May 2024, and many national industry planning were approved simultaneously or after the provincial planning approval. Therefore, many industry and regional planning must not have been updated in the provincial planning.
Thus, the province needs to urgently and proactively review the provincial planning to adjust and update the regional planning, industry planning, and national industry planning for consistency. Simultaneously, it is necessary to develop planning and land use plans, especially the land use plan for the period, to ensure synchronization.
Particularly, it is crucial to promptly implement the national industry planning in the fields of energy and minerals in the area. Accordingly, by 2030, the province is planned to have: 28 MW of rooftop solar power, 30 MW of biomass power, 1 MW of waste-to-energy, 25 small hydropower projects with a total capacity of 223.5 MW, 01 cogeneration thermal power plant project with a capacity of 100 MW, 11 power grid projects, 26 mineral mining sites, and 03 rare earth processing projects.
“As such, Lao Cai has many favorable conditions to implement these projects. If they are realized, they will not only enhance industrial, commercial, and service production capacity in the area but also awaken the local potential, fostering the development of other economic sectors,” emphasized Mr. Dien.
Regarding the mineral industry, it is necessary to focus on deep processing rather than just extraction. Support and facilitate businesses to implement a rolling mechanism to achieve two goals: increasing the added value of the deep-processed mineral industry and creating clean land funds to attract investment.
Lao Cai needs to restructure the industry towards modernity, large-scale production, green and circular development, and sustainability. Focus on developing the industry of deep processing of minerals, establishing Lao Cai as a leading metallurgy, mechanics, and chemicals center in the country.
It is essential to pay attention to the deep processing of some agricultural products with strengths in the province (such as tea, cinnamon, medicinal materials…) to enhance export value and meet the requirements of demanding markets (such as the US and Europe).
Developing clean energy sources and supporting industries associated with local advantages is also crucial. The province should promote the internal structural shift in the industry, especially in clean energy, processing, and manufacturing, towards promoting industry groups and products that apply high technology, have high added value, use clean technology, and produce export goods.
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