HCM City needs development policies as population surges

Visitors to HCM City on Nguyen Hue Street in District 1. - VNS File Photo

The city’s population rose from 3.4 million in 1975 to 8.9 million in 2016, and the figure is expected to increase to over 10 million by 2019.

Today, the city’s population is six times higher than the average population of each province (1.5 million), accounting for more than 9.1 per cent of Viet Nam’s population, Nhan said at a HCM City Party Committee meeting held last week.

The city’s population density is 4,000 people per sq.km, while the average population density of provinces across the country is only 280 people per sq km.

“The figure in HCM City is expected to increase sharply in coming years,” Nhan said, adding that the rise in population had worsened traffic congestion.

Because of the huge increase in population, HCM City now produces a massive volume of waste, 15 times higher than the average amount in other provinces.

The demand for clean water in the city is 20 times higher than in other provinces, according to Nhan.

At least 21.6 per cent of the country’s GDP is contributed by HCM City, with each sq km of land in the city contributing an average of VND463 billion to GDP each year, 34 times higher than the average rate of other provinces, he said.

The city has important advantages over other localities, including a workforce composed of 27 per cent of university graduates and a high rate of labour productivity.

Of the 477,000 enterprises in the country that pay tax to the state, 160,000 are from HCM City. The city’s enterprises contribute up to 33.6 per cent of the total national budget.

Challenges

However, 55 per cent of the city’s land is used for agricultural produce, contributing 0.8 per cent of the city’s GDP, while the industrial and service sectors use only 6.8 per cent of the city’s land, contributing 99 per cent to the city’s GDP.

“That’s an irrational proportion,” said Nhan. “If land priority was given to the industrial and service sectors, the city’s GDP would increase.”

Despite its rapid economic growth, financial resources remain the biggest challenge facing the city.

In 2003, HCM City maintained 33 per cent of the city’s revenues, but the figures dropped to 20 per cent, 26 per cent and 23 per cent in the following years, and to 18 per cent in 2016.

The city also faces challenges in transport infrastructure, which remains underdeveloped, affecting all sectors of society as well as public confidence, Nhan said.

Attracting more foreign investment remains a challenge as well. In 1997, FDI contributed 38 per cent to the city’s total investment capital, but that figure has dropped to 15 per cent for several reasons, including land issues, infrastructure and transportation development.

Lower foreign investment rates have resulted in lower exports. Fifteen years ago, the city’s export turnover contributed 56 per cent of the country’s export value, but the figure has fallen to 18 per cent.

The city is also dealing with the effects of climate change, including land erosion and saline intrusion.

Nhan said to cope with natural disasters, the city must build sea and river dikes, but finding funds to build them would not be easy.

Another challenge to sustainable development is the number of patients newly infected with HIV, accounting for 16 per cent of the country’s total figure. In addition, the birth rate is 2 per cent lower than the rate of the entire country.