The biggest obstacle in determining specific land prices over the past few years has been policy. The government is amending and supplementing Decree No. 44/2014; the Ministry of Natural Resources and Environment is amending and supplementing Circular No. 36/2014. Due to various reasons, Binh Thuan has been "waiting" for the past three years, and by 2023, a review across the province revealed that 47 projects were awaiting specific land price determination. The situation unfolded as the Chairman of the Provincial People's Committee acknowledged: Businesses cannot wait any longer…
Lesson 1 : Carefully addressing land price fluctuations
2/47 projects
In late December 2023, the Provincial People's Committee issued a decision approving specific land prices to determine financial obligations for another tourism project in Phan Thiet city. Notably, this is the second of 47 projects in the province that has been unable to proceed with further steps due to awaiting specific land price approval. With land designated for commercial and service use, and the land leased from the State with a one-time payment for the entire lease period (calculated for the remaining 35 years of the project), these two projects have contributed approximately 126 billion VND to the State budget in land use fees.
At a recent meeting to implement the socio -economic development plan for 2024, Chairman of the Provincial People's Committee Doan Anh Dung emphasized that, through the two aforementioned projects, the relevant provincial authorities will gain experience and methods to continue conducting specific land valuation for the remaining projects. In reality, the implementation of specific land valuation for each project faces many obstacles stemming from policy regulations, coupled with delays caused by related legal cases. This has made officials and valuation companies cautious, and even those with valuation functions hesitant. This is the main reason, not to mention the impact of the COVID-19 pandemic, which has resulted in a backlog of old tasks and a build-up of new ones over the past three years, creating a total of 47 projects. And by the end of 2023, only two projects had received specific land valuation approval.
Currently, the Provincial People's Committee assigns specific thematic areas such as housing, commercial services, tourism, and minerals to the Chairman and Vice-Chairmen of the Provincial People's Committee for direction. The Provincial People's Committee leaders have held meetings for each thematic project group and issued concluding notices to direct the resolution of difficulties and obstacles for each project and project group. At the same time, they continue to direct the review of projects that meet the criteria for determining specific land prices, urging consultants to promptly finalize land price plans for one-time land lease payments, land allocation with land use fees, or to remove projects from the list of those not requiring land price determination, projects that do not meet the criteria for land price determination, and projects that require guidance from the Ministry of Natural Resources and Environment.
We are determined to complete 3 major projects by the end of Q1 2024.
Following the two aforementioned tourism projects, there will be three major projects that, according to the head of the Department of Natural Resources and Environment, will be determined to finalize specific land prices by the end of the first quarter of 2024. These include the NovaWorld Phan Thiet project and the Tan Duc and Son My 1 industrial parks. For these three projects, consulting units have begun developing specific land prices. However, during this process, many obstacles and difficulties have arisen stemming from policies and practices, including the limited availability of information for land lease pricing in industrial parks. The Department of Natural Resources and Environment has advised the Provincial People's Committee to propose solutions to the central government. For example, the NovaWorld Phan Thiet project has encountered numerous obstacles regarding policies and valuation methods; furthermore, this project is very large in scale with many complex investment and business items, including some unique business items not yet available in the province. Subsequently, in August 2023, the Prime Minister's Task Force and the Ministry of Natural Resources and Environment provided guidance to resolve the issues. However, the valuation results from the consulting firm still lacked sufficient information and calculation methods for some items such as the golf course, villas, and amusement park, so the Department of Natural Resources and Environment requested the firm to supplement and finalize the results. On January 10, 2024, the Department sent a letter to the consulting firm requesting them to promptly submit the valuation results for the NovaWorld Phan Thiet project.
“Currently, the Department of Natural Resources and Environment has directed the Land Management Sub-Department to request the consulting unit to complete the valuation certificates for two tourism projects, including NovaWorld Phan Thiet, and send them to the Department for a meeting to gather opinions from the Department of Construction, the Department of Finance, the Tax Department, the Department of Planning and Investment, and the People's Committees of the districts and cities where the projects are located, in order to submit the valuation certificates to the Provincial Land Valuation Council,” said Mr. Tran Nguyen Loc, Director of the Department of Natural Resources and Environment, at the meeting to implement the province's socio-economic development plan for 2024.
At the same time, Mr. Loc also informed that other projects among the 47 projects are continuing to finalize their certificates to hold meetings to gather opinions before submitting them to the Provincial Land Valuation Council. Regarding the two projects, Son My 1 Industrial Park and Tan Duc Industrial Park, at the end of December 2023, the Department issued a document approving the land price adjustment coefficient to determine the specific land price for compensation calculation when the State acquires land for the two projects. This document was sent to the Ham Tan District People's Committee requesting them to work with the consultant again for explanation, paying particular attention to analyzing and excluding comparable assets with exceptional value from the land price plan; and reviewing the legal basis to ensure strict compliance with regulations. The consulting unit is currently making revisions. After Ham Tan District submits the revised documents, the Department will compile a report for the Provincial Land Valuation Council to make a decision.
Once specific land prices for compensation are established, the land clearance process will be smoother. As Ham Tan district has suggested, the compensation plan has not yet applied specific land prices, only temporary prices based on Decision No. 37/2019/QD-UBND, thus failing to gain the consensus of those whose land is being acquired. Expediting land clearance will help consolidate the project's land, which is currently not contiguous, facilitating the establishment of specific land prices for lease calculations and enabling investors to proceed with construction according to the plan.
In other developments, at a meeting held on January 16, 2024, Vice Chairman of the Provincial People's Committee Nguyen Hong Hai directed the Department of Natural Resources and Environment to coordinate with relevant departments and agencies, the People's Committee of Ham Tan District, and Sonadezi Joint Stock Company to complete the approval of specific land price adjustment coefficients for agricultural land located within residential areas and land lease prices in Tan Duc Industrial Park by February 2024.
Lesson 2: How to retain and attract large projects
BICH NGHI - PHOTO BY N. LAN
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