Few Vietnamese companies receive tech transfer from foreign companies

Few Vietnamese companies receive tech transfer from foreign companies

Technology transferred through foreign direct investment has not occurred in Vietnam, economists have said.

Pham Chi Lan, a renowned economist, said that Vietnam should not expect technology transfer from foreign investors.

“Vietnamese small- and medium-d businesses do not have close relations with foreign-invested enterprises simply because they are not on the same playing field,” Lan said.

“Foreign-invested enterprises, which receive many investment incentives, make friends with each other. Vietnamese businesses play in another field, with no incentives,” she added.

“Private Vietnamese businesses have a high corporate income tax of 22 percent, while foreign invested enterprises are taxed 10 percent only for 15 years. Why should the foreign invested enterprises cooperate with the Vietnamese and transfer technologies to Vietnamese businesses?” Lan said.

The director of a private mechanical engineering company, who asked to be anonymous, said that foreign-invested enterprises did not trust Vietnamese enterprises and were not inclined to transfer technologies to Vietnam.

An analyst noted that Samsung, the South Korean electronics group, a big foreign investor in Vietnam which has received special investment incentives, has never made promises about technology transfer.

Samsung has only promised to work with Vietnamese businesses capable of providing spare parts and components as satellite businesses. Samsung suggested that in the immediate time, Vietnamese businesses should only work as second- or third-class suppliers.

“In upgrading technologies and improving business capability, Vietnam should not and cannot expect assistance from foreign-invested enterprises,” Lan said.

A survey of 8,000 Vietnamese enterprises conducted by the Central Institute of Economic Management (CIEM), the General Statistics Office (GSO) and the Copenhagen University found that 90 percent of Vietnamese businesses do not carry out R&D (research and development) and technology improvement.

Only 3 percent of the enterprises said they tried to improve technology and 5 percent carried out R&D. Lack of capital is believed to be the main reason behind the businesses’ indifference to technology upgrading. The 500 businesses which carried out R&D said they spent only 4 percent of their total budget to develop new technology.

The survey found that only 11 percent of local businesses received technology transfer from foreign importers, and 14 percent had received tech transfer from foreign partners who provided them with input materials.

In most cases, the technology transfer was a provision included in contracts signed between the parties.

vietnamnet