(VEN) – The southern province of Binh Duong is implementing solutions to develop support industries in order to meet local production needs and reduce reliance on imports.
Not meeting demand
According to the Binh Duong Department of Industry and Trade, the province currently has 2,277 businesses involved in support industries, including 442 in the garment and textile sector, 172 in leather and footwear, 953 in wood processing and 710 engineering firms.
Despite significantly improved capacity, local support industries have only met 40-45 percent of demand from the garment and textile, leather and footwear sectors; 10-20 percent of demand for nine-seat auto manufacturing and assembling; 15 percent for electronics and informatics; and five percent for specialized electronics and high-tech. Truong Thi Thuy Lien, deputy general director of the Lien Anh Company in Binh Duong Province’s Di An Commune, said raw leather offered by domestic tanning factories is low-quality cowhide and small pieces, making it difficult to meet demand for exports. Meanwhile, the import of each batch of alum leather to make finished products is difficult to control in terms of quality, and it mainly depends on the reputation of foreign partners.
According to the Binh Duong Furniture Association, with its position as the province’s main export sector, local wood businesses annually spend several hundred million US dollars to buy raw materials such as screws, paint and sandpaper. If support industries develop strongly, the province will have a bigger budget and businesses will have enough raw materials on the spot, saving time and money.
Binh Duong Province has been striving to build a long-term strategy to develop support industries effectively. Specifically, the Binh Duong Department of Industry and Trade is implementing a project to develop support industries in order to advise the provincial people’s committee on completing and supplementing the legal basis and the stimulus package for local support industries. The focus is on developing local support industries by 2025, formulating regulations on management and implementation of support industry development programs, implementing training courses, supporting human resource development, enhancing management capacity of support industry businesses, and assessing the local content of four key industries.
Binh Duong Province has formed industries producing materials for garment and textile, leather and footwear, engineering, electric-electronic sectors. The province has also developed a 1,000ha industrial zone in Bau Bang District to prioritize investment attraction in support industries.
The province will continue to improve the investment environment, encourage the development of each group of support industry products, form industrial zones and clusters to produce spare parts and components for industries, and support small- and medium-sized enterprises to participate in the production of auxiliary products.
In addition, the province will build a system of technical standards for product quality according to international standards, provide support for businesses in research and development, and promote technology transfer. The Binh Duong People’s Committee has issued a decision on the list of investment priorities for socioeconomic infrastructure development during the 2017-2021 period. The province is also developing preferential policies to promote investment in industry, especially support industries.
The Binh Duong Department of Industry and Trade will strengthen cooperation with associations to understand business needs. In addition, the department will coordinate with management boards of industrial zones to organize goods supply-demand connection programs in order to create favorable conditions for support industry businesses to meet domestic and foreign partners, exchange information and share experience so they can join global supply chains.
To develop support industries, Binh Duong Province is completing planning of raw material areas, while continuing to
improve the investment environment to attract domestic and foreign investors.
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