A Singaporean and Vietnamese joint venture has been green-lighted to develop a 750-hectare integrated township and industrial park in the north-central province of Nghe An, the seventh project of its flagship Vietnam-Singapore Industrial Park (VSIP).

The first phase of the VSIP Nghe An will comprise 198 hectares of industrial land and 81 hectares of commercial and residential land, the developer, Vietnam Singapore Industrial Park Joint Venture Co. (VSIP JV), announced Tuesday.

VSIP JV is a joint venture between Vietnam’s Becamex IDC Corporation and a Singaporean consortium in which Sembcorp Development holds a 92.9 percent stake. The Vietnamese side owns 49 percent of the joint venture.

Sembcorp Development is a wholly-owned subsidiary of Sembcorp Industries, a leading Singaporean energy, water and marine group.

The investment in phase one of the VSIP Nghe An will be funded partly by equity of US$15.2 million from VSIP JV, and the remainder will be financed by external borrowing and project cash flow, Sembcorp Development said in a press release on Tuesday.

Nghe An, located 400 kilometers from Hanoi and 70 kilometers from the border with Laos, plays a supporting role to the Vietnamese capital city.

The VSIP Nghe An will mostly target garment manufacturers, agribusinesses and fast moving consumer goods sectors as its favorite tenants, who will be able to enjoy special economic zone incentives from local authorities, according to Sembcorp Development.

The VSIP Nghe An adds to the list of six existing VSIPs across Vietnam, two of which are located in the southern province of Binh Duong, one in Quang Ngai Province in the central region, and one each in Bac Ninh Province, Hai Phong City and Hai Duong Province in the north.

The first VSIP was established in Binh Duong in 1996, and the second came online ten years later in the same province.

The VSIP reflects excellent bilateral economic ties between Vietnam and Singapore, Singaporean Prime Minister Lee Hsien Loong said in a statement prior to his Vietnam visit in 2013.

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