Support industries predicted to attract greater foreign investment

25-Nov-2020 Intellasia | VNA | 6:51 AM Print This Post

Support industries for machinery manufacturing, electronics, and deep processing are forecast to attract greater foreign investment in the years to come, according to insiders.

Hua Quoc Hung, director of the HCM City Export Processing and Industrial Zones Authority (HEPZA), said it has already exceeded its 2020 investment goal, with total registered capital of more than 591 million USD, up 7 percent compared to the same period last year.

Investment primarily focuses on areas encouraged by the city, including support industries, the official noted.

Six of the 11 newly-licensed FDI projects are in support industries for the fields of mechanics, electronics, plastics, and rubber.

Notably, Japan’s Nikkiso Vietnam MFG Co., which specialises in producing medical equipment, increased its investment capital by 3 million USD to expand production in Vietnam.

Among the FDI projects licensed by local authorities in 2020 are many large projects in support industries, such as the 20 million USD investment from Singapore’s Ever Giant International Private Limited producing aluminium alloy products, and a 30 million USD project owned by the island state’s Sung Shin Tech Limited.

Eighty-six percent of FDI in Binh Duong has gone to manufacturing and processing, while many support industry projects in electricity, electronics, mechanics, pharmaceuticals, and chemicals have been attracting investors.

Meanwhile, according to the Dong Nai Industrial Zones Authority (DISA), the majority of newly-licensed FDI projects this year are in support industries.

Projects in the field also had capital added, such as those invested in by the Schaffler Vietnam Co. and by the Chang Shin Vietnam Co., with 50 million USD and 87 million USD, respectively.

The Saigon Hi-Tech Park (SHTP) in HCM City said it signed an agreement with the management boards of industrial parks and export processing zones in the southern key economic region in late October to form a network of organisations to support small- and medium-sized enterprises (SMEs) in support industries via regional links.

The agreement also supports businesses operating in support industries in expanding domestic and foreign markets by creating a direct supply-demand link between enterprises and introducing industrial manufacturing units to join the supply chains of domestic finished product manufacturers and FDI enterprises.

According to HEPZA, it will grant investment licenses to a large-scale FDI project in the support industry that will focus on building high-rise workshops for lease to enterprises participating in the group’s production and supply chain.

Okada Hideyuki, Chair of the Japanese Business Association in HCM City (JBAH), forecast that the wave of Japanese investment shifting to Vietnam will be stronger by the end of this year or early next year, when the COVID-19 pandemic is brought under full control.

Support industries for machinery manufacturing, electronics, and deep processing will receive major investment from Japanese businesses, he said, adding that within Japan’s new investment trend, most businesses are using modern and environmentally-friendly technologies and fewer workers.

Prime minister Nguyen Xuan Phuc, meanwhile, signed Resolution No 115 this year on measures to further propel support industries, setting out development goals for the next decade.

Vietnamese enterprises are to be able to produce highly-competitive support products, meeting 45 percent of essential needs for domestic production and consumption and accounting for about 11 percent of industrial production value by 2025.

About 1,000 enterprises are to be capable of direct supply to assembly enterprises and multinational corporations, with domestic enterprises to account for about 30 percent by 2025.

By 2030, support products will meet 70 percent of demand and account for about 14 percent of industrial production value. Some 2,000 companies are to be capable of supplying directly to assemblers and multinational corporations by 2030./.

https://en.vietnamplus.vn/support-industries-predicted-to-attract-greater-foreign-investment/190876.vnp

 

Category: Business, Vietnam

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