3:39:34 PM | 8/8/2005
According to reports by the Ministry of Post and Telematics, statistic figures of the software industry seem optimistic. However, local software manufacturers still face many difficulties and challenges, without proper solutions it could be very difficult for the Vietnamese software industry to achieve the target assigned by the Government.
Low export value
Between 2000 and 2004, the average growth rate of the domestic software market was put at 30 per cent. This figure for total value of software products and services was put at over 32 per cent. In recent years, Vietnamese-made software products have seen a high export growth rate. Local software manufacturers have made great efforts to enter major markets, such as the EU, the and . However, the export value of software products remains low. In 2004 alone, total export value of software products reached around US$45 million, accounting for around 25 per cent of total revenues of the local software industry. The remainder went to the domestic market.
So far, has around 2,500 companies registered to manufacture software products. However, only around 600 enterprises have become operational, employing over 15,000 programmers and workers. The annual average growth rate of the number of software enterprises is around 30 per cent.
Difficulties
The major difficulty local software manufacturers face is a lack of capital. Many ideas suggest that to seeking capital sources is an issue of both enterprises and banks. Accordingly, enterprises can borrow from banks as stipulated – with mortgage. This is normal. However, in many cases, not all software enterprises can borrow money from banks. If it is considered as the State’s investment to develop markets and the software industry, some ideas suggest that the State should accept a certain rate of losses, providing enterprises with financial support. This may be a solution to save software enterprises from a premature death.
Another difficulty is their personnel. Enterprises do not consider a lack of staff members or a lack of skilled staff members as their difficulty. Instead, they blame instability of human resources. Small and medium-sized enterprises even cannot maintain their stability in their operation. Therefore, a stable business environment is needed for software enterprises.
Furthermore, software enterprises have paid careful attention to the market. The two challenges for local software manufacturers include a lack of market information and market instability. Enterprises said that apart from their efforts, they need further support from the State to collect information about markets. In the domestic market, the most important customer is the State-owned sector. Local enterprises need open and adequate information about the sector’s demand on the implementation of information technology projects of ministries, and central and local agencies.
Apart from difficulties, the software industry still faces many other challenges, including privacy, solutions for small and medium-sized software enterprises’ development, and trade promotion programmes, human resources development. There are many things for the local software industry to solve for a more rapid development of the market and local software enterprises.
Huyen Nhi
Vietnamese
