Cities forge ahead with investment in support industries

Initiatives taken by localities

Through initiatives of industrial enterprises and state support, localities have implemented a series of programs, such as Sustaining Competitive and Responsible Enterprises (SCORE) to help small and medium-sized enterprises (SMEs) improve productivity and product quality. Under a Good Supplier Development program, hundreds of meetings have been held between domestic and foreign-invested enterprises to seek product outputs.

Most recently, support industry enterprises have invested in a precision engineering project in Saigon Hi-tech Park (SHTP) in Ho Chi Minh City with total registered capital of more than VND1 trillion. Once operational, plants are expected to manufacture high precision machine parts, plastic components, motor axis and molds of different types.

Hanoi City People’s Committee also approved the Project for Supporting Industry Development Program for the 2018-2020 period, with orientation to 2025. Accordingly, by the end of 2020, about 900 enterprises will operate in supporting industries in the capital. Of these, 40 percent already possess production systems and products of international standards and are eligible to supply multinational corporations’ global production network in Vietnam.

In Hai Phong City, the local People’s Committee also issued Decision 3499/QD-UBND on a list of prioritized industrial projects until 2025 with orientation to 2030. These include mechanical projects; automobile manufacturing and assembling.

Strengthening links

Truong Hai Automobile Joint Stock Company (Thaco), one of Vietnam’s leading support industry enterprises, has 13 satellite factories. In addition to providing parts for Thaco producers, it can also supply for non-Thaco manufacturers in Vietnam. A representative of Thaco said to promote the development of the domestic supporting industry, connectivity and cooperation must be strengthened; information channels including websites, must be developed to enable support industry enterprises to easily search for development opportunities and connect with other businesses.

A representative of the Minh Nguyen Support Industry Joint Stock Company said that by joining the Good Supplier Development program, the firm has procured advanced equipment and technology worth VND1.6 trillion to produce high-tech products. As a result, the company has become a level-one electronic component supplier for the Republic of Korea’s Samsung Group, represented by Samsung Electronics HCMC CE Complex Company Limited in the Saigon Hi-tech Park.

Ho Chi Minh City ranks first nationwide in terms of the number of support industry enterprises. The city has been building databases on support industry businesses to provide assistance in investment promotion and seeking suppliers and buyers. Over the past year, the city has updated databases of more than 500 support industry companies, which will help them learn about demand on quality, quantity as well as standards of domestic and foreign final producers in order to identify the supply requirements; gradually improve production capacity, meeting the requirements of partners, and participate in the global supply chain.

Meanwhile, Hanoi is attracting investment and developing support industries through activities of the Support Industry Development Program, contributing to forming satellite businesses and promoting cooperation and connectivity between local support industry enterprises and assemblers, multinational corporations and foreign-invested enterprises in Hanoi, the northern region and the country as a whole.