Southern Ba Ria-Vung Tau province’s auxiliary industry is being paid attention by the Vietnamese government.
The province is determined to develop well-balanced industries and not rely on oil and gas
In order to enhance products’ value and reduce dependence on imported source of production devices, many efforts are being made to promote development of this industry.
Developing the auxiliary industry in Vietnam is a decisive factor to stable development of industries such as supplying materials, reducing dependence on foreign imports, improving competitiveness, drawing more foreign direct investment based on long-term comparative advantages of Vietnam. These include the local workforce, raw materials or conditions for building infrastructure and inventories.
Pursuant to a draft proposed by the Department of Industry and Trade from now up to 2020, 49 product items in six different industries within “The list of highly favoured auxiliary industry products” comprise informatics-electronics, garment and textiles, leather and footwear, automotive production and assembly, mechanical engineering and high-tech development. Development objectives for auxiliary industries until 2020 are to reduce imported ratio of materials, components and increase local supply ratio to 60-70 per cent.
Ba Ria-Vung Tau’s industry plays a very important role in Vietnam’s economic development. In 2010, industry and construction sector made up 72.52 per cent of the whole province’s economy. Industrial production value (excluding oil and gas) from 2006-2010 gained rather high growth rates, on average 19 per cent, per year. The total licenced industry-related investment projects were 291. Auxiliary industries alone occupied 79 projects with total registered capital of $781 million among them are 43 foreign investment projects with total registered capital of $543 million, and 36 local investment projects with total registered capital of $238 million. Auxiliary industries are mainly mechanical, electrical & electronics engineering, plastics, leather and footwear. Also, 1,000 small enterprises in districts are producing auxiliary products for main industries in the province without reasonable development to reduce reliance on foreign imported assembling accessories.
According to Ba Ria-Vung Tau Department of Industry and Trade, in order to meet the development requirements, Ba Ria-Vung Tau will promote the auxiliary industries to support the main industries in the province with the following orientations:
l These include general planning for developing auxiliary industries in the province, proposing objectives and policies encouraging long-term development on the basis of apportioning and using effectively source of development especially human and financial resources. Defining development of auxiliary industries as key industry to build policies attracting investment and development, focusing on machinery, manufacturing patterns, components from plastic and steel to supply the shipping repair industry, oil and gas technical services, electrical and electronics equipment.
l Attracting auxiliary industries foreign investors to invest in industrial zones to lay the foundation of auxiliary industries in province will blossom from 2011-2015. Continuing to speed up planning process and developing industrial zones in areas within the province in the direction of building up specialised industrial zones in order to attract investment capital for expanding auxiliary enterprises is essential.
l Linking supportive policies for small- and medium-sized enterprises (SMEs) in order to enhance enterprises’ production organisation with respect to their ability involving in production according to their industry is key.
l Strengthening synchronous investment in technical and social infrastructure in order to attract foreign and domestic investment capital developing auxiliary industries is important. There needs to be a focus on developing strongly human resources according to each industries requirements such as mechanics, electricity, electronics and sculpture art.
l Setting up supportive policies for SMEs to easily accessing funds and auxiliary industry skills will fit with establishing a provincial development fund to carry out preferential policies for auxiliary enterprises. Encouraging industry activities, supporting technology and science development must focus on assisting SMEs in investing, doing research and developing auxiliary industries expansion.
The provincial government will carry out promotion activities under Decision No. 602 issued by the Ministry of Planning and Investment in 201. Then investment promotion activities including investment seminars and surveys overseas, investment promotion programmes for auxiliary industries, heading directly toward partners with strong auxiliary background like Japan, the US, Thailand and Malaysia.
Specifically, the seminar on auxiliary industries will be held in Vung Tau city by the government’s provincial officials and Kansai Small and Medium Association to strengthen investment cooperation with Japan and urge to develop auxiliary industries projects in Ba Ria-Vung Tau.