Auxiliary industries to be facilitated on worthy position

In the total of over 40.6 billion US dollars of foreign direct investment (FDI) in Binh Duong, more than 74% of the capital is concentrated in the processing and manufacturing industry. However, investment in high technology and supporting industries is still limited. In order to gradually improve the level of industrial production, Binh Duong has actively developed the supporting industry and integrated the local industry deeply into the global value chain.

Industrial support for the processing and manufacturing in Binh Duong is still weak and has not met the demand. In the photo: Production activities are at Foster Electronics (Vietnam) Co. Ltd. in VSIP II Industrial Park.

To grasp up opportunities on rapid transformation

Binh Duong is among the top 5 localities with a strong development of supporting industries in the country. The development of the supporting industry has initially formed a production linkage between domestic enterprises and FDI enterprises. At the same time, it creates conditions for domestic enterprises to gradually access advanced technology and participate in the global value chain.

According to Mrs. Nguyen Thanh Ha, Deputy Director of the Department of Industry and Trade, Binh Duong has developed industries producing raw materials for textile, garment, leather, mechanical, electrical and electronic sectors. Although the supporting industry in the province has been significantly improved, it still fails to meet the domestic demand for both quantity and quality of raw materials for production, which stands at 40-45% for textile and garment, leather and footwear, 10-20% for manufacturing, assembling cars under 9 seats, 15% for electronics, information technology, telecommunications, 5% for specialized electronics and high technology.

Dependency on imported raw materials is still a weakness of the processing and manufacturing industry in the province. In order to attract investors to the supporting industry, Binh Duong has prioritized and encouraged the development and enhancement of the capacity of supporting industrial enterprises. However, Binh Duong still does not have a specialized industrial park for deep supporting industries. When the mechanical supporting industrial park becomes operational, it will continue to make Binh Duong an attractive destination for many international corporations to choose for investment and development of supporting industrial products.

Mr. Do Minh Tam, General Director of Thaco Industries, believes that Binh Duong has many strengths to develop supporting industrial zones. The province has a strong business community, advantages in infrastructure, land fund, and the support of the government. Therefore, the supporting mechanical industrial zones not only encompass the automotive industry but also expand into many other fields.

To enhance investment luring effects

According to the statistics from the Provincial Industrial Park Management Board, as of the end of May 2023, Binh Duong province has 2,453 valid FDI projects with a total registered capital of 29.74 billion US dollars. Of these, more than half of the investment capital is concentrated in the supporting industry sector. There are increasingly larger projects and enterprises participating in the supporting industry in the province. According to statistics, currently there are nearly 2,300 businesses operating in the province in industries related to the support industry, including 442 textile and garment businesses, 172 leather and footwear businesses, 593 wood processing businesses, and 710 mechanical businesses.

High-tech development projects and industrial support projects that have received significant investment can be mentioned, such as the project of manufacturing tire and airbag factories with a capital investment of up to 1 billion US dollars, on an area of 42 hectares owned by Kolon Group (South Korea), providing materials for the automotive industry. The project of producing synthetic fibers by Polytex Far Eastern Co., Ltd. (Vietnam) with a registered capital of over 1 billion US dollars; the project of a factory specializing in producing aseptic packaging from paper, plastic, and aluminum for food packaging by Tetra Park Binh Duong Joint Stock Company (Singapore), with a registered capital of 124 million US dollars; the project of Nitto Denko Co., Ltd., with a registered capital of 186.2 million US dollars.

Along with that, many previous industrial projects have continued to increase investment capital and expand production. Recently, Panasonic Electric Works Co., Ltd officially put into operation a wire connecting equipment manufacturing plant at VSIP 2 Industrial Park. This new factory helps increase the company's capacity by 1.8 times compared to the current level, reaching nearly 150 million devices per year. According to Mr. Nagato Takahiko, Chairman of the Japan Business Association in Binh Duong, Binh Duong is a locality that Japanese businesses choose to invest heavily in the industrial sector. Specifically, in the fields of industrial production supporting machinery manufacturing, electronics, and deep processing.

Recently, Tetra Pak Corporation has announced that it will invest an additional 97 million euros in the beverage carton production plant in Binh Duong province, bringing the total investment since 2019 to over 217 million euros. Previously, Polytex Far Eastern (Vietnam) Co., Ltd. has also increased its capital twice, bringing the current total investment of the company to over 1.37 billion US dollars.

Deputy Director of the Department of Industry and Trade, Ms. Nguyen Thanh Ha, said that industrial support enterprises in the province are being provided with conditions for development to gradually participate in the supply chain. Once the support industry develops, it will create connections and early specialization, forming a system of suppliers of raw materials and high-tech component production.

Mr. Mai Hung Dung, Deputy Chairman of the Provincial People's Committee, said that Binh Duong always ranks first in the country in attracting FDI, although the results of investment in high technology and supporting industries are still limited. To develop sustainable industry, to go in depth, Binh Duong has been actively supporting industrial development, helping to increase the value of industrial products produced by domestic enterprises, and deeply integrating local industry into the global value chain.

Reported by Ngoc Thanh – Translated by Vi Bao