Foreign investors frown on weak supporting industries
Weak supporting industries and a lack of skilled labor are among the major barriers to foreign investment capital flow in the city, according to representatives of foreign-invested companies.
At a meeting with leaders of HCMC on March 4, foreign investors called for the city to quickly resolve the two problems to support them to improve competitiveness at a time when Vietnam is deepening its integration in the world.
They complained they had made great effort to increase local content in their products to strengthen their competitiveness but to no avail.
Yutaka Watanabe, general director of Japan’s Towa Industry Co., Ltd. in Tan Thuan Export Processing Zone in District 7, said the company has been operational in Vietnam for 20 years but it has had difficulty finding local material suppliers, making its products less competitive.
With its billion-dollar facility to assemble and test chips at Saigon Hi-Tech Park in HCMC, Intel Products Vietnam is also facing the same problem.
Sherry Boger, general manager of Intel Products Vietnam, underscored an urgent need to develop local supply and high tech industries, saying her company could support Vietnam in this area.
Boger suggested the Vietnamese Government weigh establishing industrial clusters with attractive incentives to lure new investors who can supply materials and products at low prices but of good quality and high technology.
Yasuzumi Hirotaka, deputy chairman of the Japanese Business Association of HCMC (JBAH), said the localization rate of Japanese firms in Vietnam is only 14%, well below the 20%-plus of Japanese firms in Thailand and much lower than in other countries.
If the Government does not support small and medium enterprises enough, Vietnam cannot compete with other countries in terms of supporting industries, Hirotaka said.
Regarding low-quality manpower, Ngo Duc Chi, general director of Global Cybersoft Vietnam, said the lack of high quality manpower in the information technology (IT) field had caused his company to lose many business opportunities.
Chi said the potential for the IT market is huge but the shortage of human resources in the sector has made life tough for the company and triggered fiercer competition among firms in the sector in search for talent.
The meeting was attended by 200 representatives from 12 foreign business associations and foreign enterprises operating in the city.