Rising FDI calls for better supporting industry: experts

Jul 9th at 09:19
09-07-2019 09:19:06+07:00

Rising FDI calls for better supporting industry: experts

The domestic supporting industry needs to improve to take advantage of foreign direct investment (FDI) pouring into Viet Nam, experts have urged.

 

In the first six months of the year, Viet Nam attracted more than 1,720 new FDI projects with total registered capital of nearly US$7.5 billion, according to the General Department of Statistics.

The period also saw $9.1 billion of FDI being disbursed, an 8.1 per cent increase from the same period last year.

More foreign investors have also injected capital to buy shares of or contributed capital to Vietnamese businesses, totalling around $8.12 billion so far, nearly doubling the figure in the same period last year.

Dr Huynh Thanh Dien of the HCM City University of Economics said that while this was a positive sign for the economy, authorities should examine the capability of domestic businesses, especially those in the supporting industry.

The localisation rate in the supporting industry, for example, needs to be increased to attract foreign-invested companies.

Businesses' ability to be part of the global supply chain for supporting industries is still limited. For instance, car manufacturers in Viet Nam have to import most parts, while the electrical and electronics industry has to import nearly all of its auxiliary products such as components, plastics and rubber products.

Nguyen Phuong Dong, deputy director of the city Department of Industry and Trade, said that many domestic supporting industry businesses continued to struggle with capital problems, lack of access to market information, and limited management capability to participate into the global supply chain.

A survey conducted by the department and Samsung showed that the number of faulty products and inventory goods in Vietnamese supporting businesses was still high, and the prices of their products were relatively high and non-competitive.

In addition, there is no concentrated industrial park dedicated to the supporting industry, so manufacturers in the industry are dispersed throughout many areas.

Without an industrial park and adequate infrastructure, businesses find it difficult to satisfy FDI companies' demands.

To help improve business capability, the department and the city have organised many programmes, one of which businesses received capability evaluation, innovative advices, and preferential interest rates to renovate their technologies.

Dong said the Ministry of Industry and Trade and the city would organise more events for the supporting industry to network and learn more about the demands of end-product manufacturers.

bizhub



RELATED STOCK CODE (1)

NEWS SAME CATEGORY

Viet Nam and UAE strive to lift bilateral trade to $10 billion

The Vietnamese Government will continue reforming the business environment to facilitate firms from the United Arab Emirates (UAE) investing in Viet Nam, striving...

Enterprises need better branding to compete in int'l market

Vietnamese enterprises must develop globally competitive brands if they want to succeed internationally, speakers said at a conference on domestic trademarks held...

VCCI, EuroCham to help SMEs extract EVFTA gains

SMEs will be counseled on how to benefit the most from the newly-signed EU-Vietnam Free Trade Agreement.

Numbers of new and closed enterprises keep rising: WB

There is considerable churning in the domestically-owned private enterprise sector in Vietnam, with the registration of new, and closure of existing enterprises...

Politburo passes plan to attract FDI

The Politburo, at a July 5 meeting chaired by Party General Secretary and State President Nguyen PhuTrong, approved a plan to improve the quality and efficiency of...

Foreign investors pump $1.3 billion into Binh Duong in first half of year

Foreign enterprises invested US$1.3 billion into the southern province of Binh Duong in the first half of 2019, according to the provincial People’s Committee.

Different scenarios for CPI in 2019 outlined

Experts have outlined a number of different consumer price index (CPI) scenarios for this year, which are all below 4 per cent as requested by the National Assembly.

Stakeholders urged to consult arbitrators in PPP project disputes

Arbitrators need to step-in and deal with disputes in public-private-partnership (PPP) projects so economic development will not be disrupted, experts have warned.

Seminar discusses VN-India business opportunities

Viet Nam and India can co-operate in areas of strength such as agriculture, textiles, footwear, renewable energy, and pharmaceuticals, according to the Ministry of...

U.S. President supports trade, energy cooperation with Vietnam: spokesperson

U.S. President Donald Trump, at a meeting with Prime Minister Nguyen Xuan Phuc on the sidelines of the G20 Summit in Osaka, Japan, had voiced his support for the...


MOST READ


Back To Top