Can Tho Industrial Sector Striving for International Integration

Can Tho city’s industrial sector saw a growth rate of 30 per cent in the first half of 2005. This was third highest figure in Vietnam. The sector attracted 16 more projects, capitalised at over US$40 million. With such a result, the Can Tho industrial sector has affirmed its solid position when the city develops into an industrial city.

 

Total industrial production of Can Tho reached VND 3,794 billion in the first six months of 2005, equal to 47.5 per cent of the yearly plan and up by 30.9 per cent against that of the same period last year. According to a forecast, in the final half of 2005, there are still difficulties due to an increase in price of materials and fiercer competition in exporting textiles and garments, and seafood. To gain the 2005 yearly targets, the Can Tho Department of Industry will concentrate on promoting co-operation of Can Tho city with the Mekong delta and the key southern economic region, in particular Ho Chi Minh City. Also, the development of infrastructure facilities of IPs and industrial and handicraft centres will be promoted to attract domestic and foreign-invested projects. At the same time, the city will take advantage of domestic and foreign investment capital to create capital for industrial development. The city will develop a list of spearhead industries and products, in particular exported products to gain a sustainable development for each period. Local authorities will issue more priority and industrial promotion policies, providing support for small and medium-sized enterprises. It will build an information system about industrial fields to help local enterprises access information about technology and markets.

 

Can Tho accounts for 15 per cent of the industrial production value of the whole region. In the coming years, the city will strive to increase its contribution to between 50 and 60 per cent with its number of workers accounting for between 50 and 70 per cent of the local economic structure. Its export value will reach between US$1 billion and 1.2 billion in 2010 and industrial production value (according to the 1994 price) will reach VND 21,000 billion in 2010 with an annual growth rate of 21.29 per cent.

 

Over the past few years, Can Tho industry, despite a high growth rate, has not yet become sustainable. Some processing industries, which depend much on material supplies, have suffered from complicated developments in the market. Most enterprises in Can Tho have small or medium size with outdated equipment and technology. As a result, their production capacity is constrained and the quality of their products remains poor. Their intermediary costs are often high, thus reducing their competitiveness in the market. In additions, enterprises face a difficulty to have capital for equipment and technology renewal due to poor re-investment accumulation while credit from banks are often short and medium-term ones, which can partly meet local enterprises’ demand. Site clearance and compensation for building industrial parks remain slow while the development of local human resources has not met the demand of the local industrial sector yet.

 

Therefore, in the coming time, Can Tho will concentrate its investment on spearhead industries while developing suitable human resources development strategies. At the same time, local enterprises will have to promote their equipment and technology renewal, selecting technology and equipment suitable with their capital and management capability to improve their competitiveness. Also, a focus will be given to the expansion of the domestic market alongside foreign markets.

 

In the 2006-2010 period, Vietnam is expected to fully join the ASEAN Free Trade Area (AFTA) and initially join the World Trade Organisation (WTO). This requires enterprises to develop projects suitable to Can Tho’s master plans. Accordingly, enterprises will have to have modern technology and equipment. Also, they will have to further concentrate on building and boosting their trademarks, improving the quality of products to build up customers’ trust. At the same time, they should take advantage of locally-made materials, improving their productivity, reducing production costs, saving energy and material consumption. Furthermore they should take into account their sustainable development and environment protection.