Supporting Enterprises to Innovate and Connect Supply Chains

10:13:43 AM | 12/13/2021

Vinh Phuc province has attracted many large FDI engineering and electronic enterprises that have established supply chains. However, small and medium-sized enterprises (SMEs) are finding it hard to meet and join these supply chains, thus they need to be interconnected for capacity improvement. Therefore, Vinh Phuc has many leverage policies to support them to access this market.

Supply chain connection

Mr. Nguyen Van Do, Director of the Department of Planning and Investment, said Vinh Phuc is known as a major industrial center for automobile, motorbike and electronic engineering in northern Vietnam. Currently, the province has over 11,000 businesses registered to invest a total of over VND128 trillion. Among them, about 8,000 enterprises are actually in operation. However, just a very small share of local enterprises can directly take part in the top value of supply chains of FDI enterprises, while companies in the lower value section of the chain are only taking shape. Although the province has introduced support and incentive policies to spur the development of supporting industries, there is still a significant gap between existing capacity and actual requirements.

Defining that FDI enterprises are both customers and competitors of domestic companies in the same global supply chain, Vinh Phuc advocates strengthening connectivity, cooperation and support of domestic enterprises and FDI enterprises, and facilitating domestic companies to gradually approach advanced technology and deeply participate in the value chain.

For example, more than 40 companies are engaged in automobile and motorbike supporting industries and more than 100 companies are making electronics and ICT components. Many domestic direct investment (DDI) companies are working well even amid the COVID-19 epidemic thanks to their good relationship with foreign-investing manufacturing and mechanical engineering firms, including Thuan An Industrial Investment Joint Stock Company; Cosmos Technology Co., Ltd; Me Tran Binh Xuyen Electric - Electronics Co., Ltd; SSP Moulding Co., Ltd; Thanh Thang Co., Ltd; Tung Lam Vinh Phuc Co., Ltd; and Lam Vien Co., Ltd

In July 2021, the Department of Planning and Investment coordinated with the Vietnam Technology Advice and Solution from Korea Center (VITASK) to sign a memorandum of understanding on supporting mechanical and electronic companies. This is considered a stepping stone for local companies to have the opportunity to connect, cooperate and expand markets with high-tech firms from South Korea.

Ensuring infrastructure for digital transformation of the business community

Vinh Phuc strives to be one of 20 provinces and cities with the best e-government in the country by 2025; formulate policies for the digital economy to make an important contribution to the province's gross regional domestic product (GRDP); and foster the development of smart city services and digital society in a sustainable manner. In addition, the province will focus on launching tasks and solutions to develop digital transformation infrastructure and platforms in the coming time.

According to the Vinh Phuc Department of Information and Communications, to have digital transformation infrastructure and platforms, the department asked the Provincial People's Committee to introduce such solutions as investing in the local government service platforms (LGSP) of Vinh Phuc province, and upgrading the cybersecurity and operations center (SOC).

Vinh Phuc currently has two 5G base transceiver stations; 100% of the fiber optic network is ready for connection; 66% of households have high-speed internet connectivity (higher than the national average); 100% of 3G and 4G networks cover the province. All administrative agencies from provincial to commune levels have LAN and internet connectivity.

To date, Vinh Phuc has integrated nearly 800 administrative procedures of Level 3 and Level 4 on the Vinh Phuc Public Service Center; built an online conference system with hundreds of bridge points installed at administrative agencies at all levels. The document management and administration system has been effectively operated. From March 2019 to the end of February 2021, the system sent/received over 300,000 documents, estimated to save more than VND10 billion for the state budget.

By Hien Nam, Vietnam Business Forum