With the policy of opening the market, promoting competition and integrating into the world and allowing all economic sectors to produce and supply IT services, this market has become really very active. The contribution of small and medium IT companies is very important.
Smallholding development
Together with the economic development, the role, position and importance of small and medium-sized enterprises increase robustly. The size of capital, revenue and workforce at small and medium-sized IT and telecom companies has considerable growth in comparison with larger enterprises. The IT industry has reportedly remarkable progress and development with high productivity and efficiency. In 2008, the industry was estimated to have total revenue of US$4.5 billion, a rise of some 20 per cent. Of the sum, the electronics and telecom equipment industry contributed some US$2.8 billion (US$2.4 billion from exports and US$400 million from domestic sales), up 16 per cent, the computer hardware industry made some US$700 million, up 16 per cent, the software industry generated some US$670 million, up 35 per cent, and the digital content industry made US$270 million, up 50 per cent.
Arguably, the IT industry is becoming very active thanks to the presence of companies from all economic sectors. The industry is being developed under the strategy of speeding up the growth rate and expanding the size to build a balanced and completed industry consisting of hardware, software and service. The industry has started developing the digital content industry to meet the domestic demand and gradually compete with the rest of the world.
In the electronics industry, Vietnam now has 70 State-owned enterprises with a total capital of VND400 billion (US$23 million) and 10,000 labourers; 52 private-run enterprises with a combined capital of VND500 million (US$29 million) and 1,900 labourers; 30 foreign-led joint ventures with nearly US$400 million in capital and 3,700 employees, and 39 wholly foreign-invested enterprises with US$360 million and over 3,000 workers. The electronics industry has annual revenue of over US$1 billion, including domestic sales and export earnings, in which foreign investors make some US$780 million and domestic enterprises US$250 million. More than 900 enterprises supply and assemble computers.
The number of software-related companies in Vietnam totalled some 6,000. The workforce of the software industry reached nearly 15,000 people and has productivity of US$10,000/person/year.
In fact, many companies operate in software, hardware, trading and service fields. IT companies in Vietnam are now mainly small and medium-sized, with a workforce of 10-50 people each. However, not many have popular trademarks.
Hanoi and Ho Chi Minh City house 80 per cent of IT companies in Vietnam while the rest are located in the 62 provinces and cities.
Untapped potentiality
The development of small and medium enterprises is an important role of the Vietnamese economic development strategy. This goal is stated in the Resolution of the Party Congress VIII. “Intensive investment to exploit the most resources; in new development, priority is given to small and medium size, modern technology, job creation and quick capital payback,” it says.
The importance of SMEs in the economy in general and in the ICT industry in particular is asserted in the Decision No. 133/1999/QD-TTg dated May 31, 1999 of Prime Minister, the Decree No. 90/2001/ND-CP dated November 23, 2001 of the government on supports to develop small and medium enterprises through small and medium enterprise development encouragement policy.
However, SMEs fail to tap their all resources for development. Some of the reasons are the shortage of capital, technology and experience, difficulties in market development, land policies, infrastructure and inconsistent policies.
The human resource training for software development and application is a challenge of the IT industry, especially software sector. To turn the IT industry into a spearhead economic sector, Vietnam strives to have 100,000 people holding college and university-level IT background by 2010. Of the sum, 20 per cent will reach regional and international levels.
Development goal and solution
According to the policy of the Party and State, IT will be widely applied in key economic sectors. Vietnam expects to have a good IT level in the ASEAN region. Especially, Vietnam’s policy is to widely apply and develop software industry and information content industry in combination with expansion and development of communication network.
Accordingly, Vietnam will continue to have a high growth of 40 per cent per year in software industry and information content industry. By 2010, the revenues of the two sub-industries are US$1.2 billion. Vietnam targets to become a centre of electronic, computer and telecom equipment assembly and a producer of components for new equipment manufacturing. Therefore, the development of small and medium IT enterprises will focus on software production, software transfer, informatics equipment import - export, informatics equipment installation and maintenance and IT consultancy.
To achieve these goals, small and medium IT enterprises need to restructure their operations to enhance efficiency. Besides, they also need supports and encouragements from the Government to operate in a synchronous environment.
The Vietnamese Government is speeding up administrative reform and eliminating unnecessary obstacles for enterprises to operate in the IT industry. At the same time, it focuses on completing IT service quality management to ensure the smooth connection, protect the legitimate rights and interests of consumers, raise the corporate responsibility, and enhance the capacity of the Vietnamese enterprises in the process of global economic integration.
PMT
Vietnamese
