90 percent of supporting enterprises remain small, medium-sized ones

In the supporting industry, the country currently has about 5,000 enterprises, but nearly 90 percent of them are small and medium-sized enterprises.

On February 28, at the seminar "Supporting small and medium-sized enterprises to join the global supply chain" organized by the Ministry of Industry and Trade in collaboration with the Ho Chi Minh City Department of Industry and Trade and Tuoi Tre Newspaper, Ms. Bui Thi Hong Hanh, Managing Director of NC Network Vietnam, said that the manufacturing industry, especially in the field of supporting industry, has a large market space but the supply capacity of domestic enterprises is still low.

Currently, the proportion of GDP contribution of the processing and manufacturing industry accounts for 23.9 percent, lower than industrial countries with a level of around 30 percent.

Particularly, in the field of supporting industry, the country currently has about 5,000 enterprises, but nearly 90 percent of them are small and medium-sized enterprises with a production scale of 300 employees or less.

Explaining this issue, many people think that supporting industry enterprises, in particular, and processing and manufacturing ones, in general, are facing many inadequacies. These include significant dependence on foreign-invested enterprises (FDI), reliance on imported raw materials, and low autonomy in terms of raw materials, leading to low competitiveness.

So far, the domestic industry has not had a global-scale industrial enterprise that plays a leading role in forming the domestic supply chain. In the opposite direction, the policy system has not practically supported the development of the industry, lacking legal grounds and resources to implement solutions to promote industrial development. Financial policies have not created favorable conditions for industrial development. The State management of the industry still has many shortcomings.

Developing supporting industries is one of the important solutions to improve the quality of the economy, develop sustainably, and avoid the middle-income trap; help increase the ability to attract foreign direct investment, step up the reception and transfer of technology, and promote the development of domestic small and medium-sized enterprises; thereby, creating a strong spillover effect, helping domestic enterprises to deeply participate in the supply chain of FDI enterprises and the global value chain of multinational corporations.

"Therefore, in order to be able to support enterprises to accelerate and develop, it is necessary to have criteria for screening and selecting foreign investors, avoiding attracting investors with competitive relationships with domestic enterprises. Along with that, relevant authorities need to increase the ability to connect domestic enterprises with FDI enterprises.

At the same time, it is necessary to have a loan policy with low interest rates to support enterprises to invest in equipment, research and development, technological innovation, and capacity building to help domestic enterprises participate in the supply chain of FDI enterprises," said Mr. Vo Tri Thanh, former Deputy Director of the Central Institute for Economic Management.

Mr. Ngo Minh Chau, Vice Chairman of the HCMC People's Committee, said that the city has synchronously deployed specific solutions to support businesses, such as building a program to develop supporting industries, organizing the supply-demand connection program for supporting industrial products, and supporting human resource training and development.

The city wishes to listen to the opinions of experts, scientists, associations, and enterprises to solve difficulties and propose solutions and policies to develop supporting industries, thereby promoting the city's as well as the country's industrial industry to develop more strongly.