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Economic Sector

Last updated: Tuesday, March 26, 2019

 

Fostering Supporting Industry Development

Posted: Friday, December 28, 2018


Speaking of the overall picture of Vietnamese supporting industries, Prime Minister Nguyen Xuan Phuc said that the capacity of manufacturing supporting industries has gradually improved to meet part of localisation process of the manufacturing industry, with 40 - 45 per cent of localisation in the garment and textile and leather and footwear sectors, 10 - 20 per cent for the nine-seat or fewer automobile manufacturing and assembling sector, 15 per cent for electronics and telecommunication sectors, and 5 per cent for the specialised electronics and high-tech sectors.

At the Conference on Solutions to Promote the Development of Supporting Industries in Vietnam on December 19, he said that there are still many shortcomings and limitations. For example, Vietnam does not have key industries to play a leading role and many industries do not meet development objectives, resulting in the underdevelopment of supporting industries and the low localisation rate in many industries.

This is attributed to the lack of strong policies to strengthen the capacity of private industrial enterprises, to form a truly favourable, transparent and stable business environment, and shape fair competition. The Prime Minister said that only 23 certificates of preferences are issued for prioritised industrial component manufacturing projects, a very low figure.

In addition, domestic enterprises are not strong enough to engage in global supply and production chains, especially when Vietnam's technological prowess is still far from other countries in the region.

Another weakness that Prime Minister Phuc pointed out is human resources, especially high-quality personnel, attributing to outdated, unpractical training contents at technical schools. Along with that, the cohesion of domestic companies and FDI firms is limited, with some FDI enterprises lacking interest in developing domestic suppliers.

He stated that, by 2020, Vietnam will have competitive industrial products, meeting 45 per cent of domestic production and consumption demand and accounting for about 11 per cent of industrial production value. The country will have about 1,000 enterprises capable of supplying industrial parts to assemblers and multinational corporations in Vietnam.

By 2030, supporting industrial products will meet 45 per cent of domestic production and consumption demand and account for about 14 per cent of industrial production value. The country will have about 2,000 enterprises capable of supplying industrial parts to assemblers and multinational corporations in Vietnam.

PV








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