Auxiliary industries promoted towards sustainable development

Update: 13-09-2022 | 10:54:20

Binh Duong has promoted auxiliary industries in a sustainable way, going into depth to help increase the value of domestic industrial products, deeply participating in the global value-added chain.

Urgent need

In general, after a lot of efforts by industries and business community, so far Binh Duong has formed up industries producing raw materials for industries of textile-garment, footwear, metal mechanics, woodwork, car and motorbike automotive machinery and equipment, consumer goods...

Developing the auxilary industry for garment is an urgent need. In picture: Thread production at DS VINA Company in North Tan Uyen district-based KSB Industrial Park

However, according to provincial Department of Industry and Trade (DoIT), the local auxiliary industries have not met the demand for raw materials for production in both quantity and quality yet. The dependence on imported materials and the province's auxiliary industries that have not yet developed strongly, have partly affected the growth quality of the local industries. The technology of most auxiliary industry enterprises in Binh Duong is only average. There are only the products of some FDI enterprises involved in this field at the advanced level. This has led to the need to import components and details for production.

Regarding technological capacity, except for a few enterprises, especially FDI ones, which are equipped with modern and complete technology and machinery, the majority have still used outdated technology and machinery, not meeting the strict requirements of the assembler. Domestic enterprises have mainly produced simple components, machines with low technology contents and added values. Despite the recent rapid development, auxiliary industries in the province are in the early stage of development. FDI enterprises process products under orders or for their parent companies. Products supplied to the domestic market as raw materials are not large.

According to Nguyen Van Luong, Director of Esquel Garment Manufacturing Binh Duong Co., Ltd., most of materials are imported to produce finished products. The dependence on imported raw materials and the slow development of auxiliary industries have affected the competitiveness of industries. Specifically, through the last Covid-19 pandemic, many enterprises, especially in the electronics, textile, footwear, and chemical industries faced difficulties in shortage of production materials. The pressure from the rising price of input materials has made FDI enterprises to have the need of finding domestic suppliers. This is also an opportunity for auxiliary industry enterprises to have more opportunities to participate more deeply in domestic and international supply chains.

Practical support

According to Nguyen Thanh Ha, Vice-Director of provincial DoIT, policies on infrastructure investment incentives, housing construction for workers, vocational training support, industrial promotion, trade promotion…to facilitate the development of auxiliary industries are regularly adjusted and supplemented by the province to suit the local actual situation.

Recently, provincial People's Council has issued the Resolution 16/NQ-HDND on the list of investment and lending fields of the Binh Duong Investment and Development Fund for the period of 2022-2026, including hi-tech and auxiliary industries. Up to now, guidelines and policies to attract auxiliary industries have been implemented by departments, agencies and sectors in the province. In particular, provincial Department of Industry and Trade has coordinated with the Ministry of Industry and Trade to review and certify that 2 local enterprises, namely Yokohama Tyre Vietnam Co., Ltd. and Esquel Garment Manufacturing Co. Ltd., are allowed to enjoy a policy on auxiliary industry development under the regulations.

For sustainable development, provincial DoIT has advised provincial People's Committee on issuing a decision on approving provincial "Project on development orientation for auxiliary industry clusters to 2020, vision to 2030". Accordingly, in the coming time, the province will invest in 4 auxiliary industry clusters with an area of 75 hectares each, including an auxiliary industry cluster specialized in mechanical engineering. In addition, provincial DoIT will coordinate with relevant departments and sectors to advise provincial People's Committee on removing obstacles, issuing mechanisms and policies to develop auxiliary industry clusters in accordance with regulations and local conditions to create favorable conditions to attract investment in auxiliary industries. Especially, they will promote the local advantegeous auxiliary industries, providing raw materials for industries of textile and garment, footwear, mechanics, electricity and electronics.

Currently, the province is home to 2,277 enterprises in the fields related to auxiliary industries. Although being improved significantly, auxiliary industries in Binh Duong province in particular and the country in general have not yet met the demand for raw materials for domestic production in both quantity and quality.They have only met from 40% - 45% of material demand for textile, garment and footwear industries; 10%-20% for the production and assembly of cars with less than 9 seats, 15% for electronics, informatics, telecommunications, 5% for specialized electronics and hi-tech industry…

Reported by Tieu My-Translated by Kim Tin

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Auxiliary industries promoted towards sustainable development

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