Stronger SME connectivity needed to boost support industry
Linking small and medium-sized enterprises (SME) and selecting some of them to join the supply chain for FDI firms to boost support industry is among ideas to promote the role of SMEs in the industry’s growth that was given in a recent conference in Ho Chi Minh City.
The four major industries’ contribution to the city’s total industry structure rose to 60% in 2015 from 54.6% in 2005, while the other two traditional ones made up 17.7%.
However, the support industry for the sectors has faced many difficulties, as the majority of firms in the field are SMEs with limited capital and technology, making it hard to expand production and join the global supply chain.
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According to Ho Minh Son, General Director of Amura Precision, a mechanics company, support industry should be paid special attention to meet high demand of the world market, especially developed countries.
Son suggested that along with more investment in technology and human resource training, it is necessary to connect enterprises in the field to enhance their mutual support and coordination, creating a supply circle and bringing higher added value to all parties.
In Ho Chi Minh City and Vietnam at large, joining the supply chain for FDI firms remains a challenge for Vietnamese businesses, he said, taking Intel Products Vietnam as an example. The firm needs 100 suppliers while only 18 firms can cooperate with it, the majority of them are foreign-invested.
Meanwhile, Le Bich Loan, deputy head of the Ho Chi Minh City Management Board for High Technology Industrial Parks, proposed the selection of some firms to join supply chain for FDI businesses.
The city should design special policies for the chosen firms to produce outstanding products in terms of quality and price, thus drawing more orders from FDI firms, she said.
At the same time, Tran Anh Tuan, acting head of the Institute for Development Studies, the growth of SMEs remains limited as there has been no specific law applicable to them and poor support in various fields, including tax, market, trade promotion, technology and human resources.
Tuan held that stronger support for SME should me made with careful selection of sectors, adding that Ho Chi Minh City should prioritise high technology, support industry and startup.
