Da Nang Skyline: The futuristic city hall (left) and the ultramodern Novotel tower over the Han River. Photo courtesy of the City of Da Nang.
As investment grows in Vietnam, Da Nang differentiates with a focus on high-tech
My first trip to Da Nang was quite by accident, but I fell in love with it.
I am a professor of global business and leadership at Saint John’s University/College of Saint Benedict — as well as an entrepreneur. One of my former students ended up working in Da Nang’s Department of Investment and Planning (DPI), and last summer he arranged for me to give a presentation on strategies to attract investment from the U.S.
I spent five days and got fascinated by the city — its beauty and culture — as well as Da Nang’s focus on becoming an IT and high-tech city instead of a low-cost production center. That’s how I got interested, and now the city wants me to help it get investments from the U.S. at its IT and High Tech park. I believe in the model they are following and hence I wanted to get associated with Da Nang and Vietnam. I believe Vietnam is the next China.
Da Nang is Vietnam’s sixth largest city and a major port, yet many older Americans remember the name because it was the site of a major U.S. air base during the Vietnam War. It was a strategic location then and it still is now, as it sits midway along the coast of Vietnam. As part of the protest movement against the war in the 1960s, people created an ironic travel poster saying, “Visit beautiful Vietnam” but which depicted soldiers fighting. Now the war is over, but the beauty remains. Indeed, Forbes magazine called Da Nang’s 70 km coastline one of the most beautiful in the world.
This extreme beauty has made Da Nang a tourist destination and its low cost of living has made it attractive to retirees. To sustain these assets, city planners do not want just any kind of economic growth.
“We are a little picky,” says Huynh Van Thanh, Vice-Director of Da Nang’s DPI. The city has denied bids to build a textile dye plant and a shipbuilding business, in order to protect local agriculture and its beautiful beach. Instead, the city wants clean industry, especially software and high tech.
Toward this end the city has made $4.5 billion worth of investments in infrastructure projects in the past five years, outpacing Vietnam’s two largest cities, Ho Chi Minh City and Hanoi. Da Nang’s improvements include a new airport terminal, a high-tech city hall, and a high-tech park, not to mention 186 miles of fiber-optic cables installed by Cisco Systems.
Da Nang is also luring investors with an incentive package that includes various discounts and tax breaks. The strategy seems to be working so far, with investors coming from a variety of countries, mostly from Asia. A little less than 10% of the investors come from the U.S., with about 50 projects totaling $848 million. As far as I know, none of these investors are from Minnesota, though it will now be my job to help change that.
Kingshuk Mukherjee is an entrepreneur and an assistant professor for Global Business Leadership at the College of St. Benedict/Saint John’s University. He is in the process of being appointed as a trade and investment representative of the Department of Investment and Planning for the City Government of Da Nang, Vietnam.