Prime Minister Nguyen Xuan Phuc has underlined the role of domestic private enterprises as one of the key measures to bolster Vietnam’s supporting industries.
Speaking at a conference on December 19, he stated that Vietnamese businesses need to have the aspiration to take part in the supply, production and value chains.
Other measures highlighted by the PM included developing human resources and applying science and technology.
He said the capacity of Vietnam’s supporting industries has improved, helping to raise domestic content to 40-45% in the garment and footwear sector, 10-15% in the manufacturing of under-9-seater cars, 15% in ICT products and 5% in high-tech electronics.
However, many drawbacks remain such as the absence of a spearheading sector as the driving force, while many of the priority industries’ have failed to meet their goals, which are attributed to the lack of a strong policy to enhance the private sector’s capacity.
The PM also pointed to a lack of highly qualified manpower and the technological level, which is lower than the regional average, as the factors that are hindering the development of Vietnam’s supporting industries.
Furthermore, the linkages between domestic and foreign enterprises are relatively weak, with foreign investors paying inadequate attention to tapping into domestic suppliers.
The government leader expressed his wish that Vietnam should take advantage of investors’ reorientation in order to transform Vietnam into a manufacturing base of multinational companies.
Concluding the conference, PM Phuc urged the Ministry of Industry and Trade to work with the other relevant ministries to build industrial development support centres, while assigning the State Bank to introduce credit incentives to develop priority supporting industries.
In the meantime, the Ministry of Finance was tasked with addressing tax issues in order to encourage supporting industries and reduce the manufacturing costs of spare parts.
Data released by the Ministry of Industry and Trade shows that enterprises in the supporting industries currently account for just 4.5% of the total businesses in the manufacturing sector and their production capacity is also fairly limited.