Dong Nai province has a fast-growing industry, which now contributes 57 percent to local GDP. The province is endeavouring to become a modern industrialised locality by 2015. According to experts, if supporting industries of Dong Nai are not developed beginning now, the province will encounter numerous difficulties in developing high-tech industrial products. This is a daunting challenge that the province to resolve now.
Challenges
Dong Nai province is attracting investment capital into support industries, with focus paid to three driving sectors of engineering, electrics - electronics, and apparel - footwear. Indeed, these three supporting industries have achieved significant progress and contributed greatly to export growth. Supporting industries have supplied components for industries of the province and the entire country, and helped raise the localisation ratio in major industrial products like motorcycles, automobiles, and electric - electronic devices. Besides, the development of supporting industries has contributed to linking the production of domestic and foreign companies.
However, the variety of key industrial products remains modest. Except for some fast-growing sectors, many have low growth rates. Key supporting industries like textile, garment, footwear, automotive and motorcycle engineering, and electronics still focus on outsourcing and assembly. Moreover, most supporting industries in Dong Nai province are now being developed by Japanese and Taiwanese companies, while domestic producers make up a minority because supporting industries and primary industries in the province lack links to boost specialisation production. This is a major challenge for the province in the process of industrialisation and modernisation.
Currently in Dong Nai, the number of firms in product support is very thin. At present, there are not many parts producers. As some companies are unable to calculate return on investments and lack cooperation with large manufacturers, they dare not make bold investment into parts production.
Opening a new way
It is obvious that supporting industries play an important role in enhancing the competitiveness of final industrial products (finished by manufacturing and assembling industries), increasing the ratio of local content, reducing dependence on imported inputs, and stepping up industrialisation and modernisation. The development of auxiliary industries holds an important position in socioeconomic development strategy, especially in the context of Vietnam integrating deeper into the world economy. For that reason, the development of supportive industries in Dong Nai province is becoming more urgent than ever, as it is necessary to meet integration requirements and local socioeconomic development.
According to the Dong Nai supporting industry development plan in the 2007 - 2015 phase, with vision towards 2020, the development of supporting industries is directed to meet both domestic and export markets. To do so, the province is attracting domestic and foreign investors into parts production. In addition to domestic supply, supporting industries of Dong Nai province are trying to become a product supply chain in global production lines managed by multinational corporations.
To give impetus to supporting industry development strategy, Dong Nai province has sent a request to the Prime Minister seeking permit to set up specialised zones for supporting industries, which will be chosen from planned industrial zones in the province.
With these specialised zones, Dong Nai will certainly attract more investors for the purpose. Thus, the industry will take initiative in all manufacturing processes, as reliance on imported inputs like components and accessories is abolished.
Thanh Tuyen
Vietnamese
