Technology transfer through FDI enterprises is a good opportunity for accessing new production technologies

At present, Binh Duong province has 2,939 FDI enterprises with total registered capital of $ 27.43 billion. This is considered as a favorable channel for technology transfer through licensing, franchising, purchasing ... or labor training. However, currently the  technology transfer through FDI enterprises still face many difficulties.

 The potential for modern technology

According to experts and scientists, nowadays technology has become the most important driving force in economic development. The reality is that high economic growth rates could come from enhancing production or technological innovation or the combination of the both. Developed countries have carried out most of R&D activities to create new technologies and innovations. The technology transfer through FDI enterprises has become a dominant channel, especially in the process of globalization today.

The technology transfer through FDI enterprises must get the cooperation between FDI and local businesses, as well as the smoothness in support policies. In picture: Snacks production at PepsiCo Vietnam Food Company (Song Than 3 Industrial Zone, Thu Dau Mot Town).

Mr. Nguyen Quoc Cuong, Director of Science and Technology Department, said that the policy of "red carpet inviting for investment" of the province has attracted many FDI companies to invest, in which there are large corporations with modern technologies. This is a potential for improving the province's production technology as well as creating conditions for enterprises to access new technologies through the technology transfer, human resource training ... Mr. uong added that Department of Science and Technology received the list of foreign technology transfer contracts for enterprises operating in Binh Duong, such as Rohto Pharmaceutical Co., Ltd transferred technology to produce eye medicine and other medicines and healthcare product with a contract value of nearly $61,000 to Rohto Vietnam Co., Ltd.; SV Probe Inc transferred the technology of producing semiconductor chip with contract value $850,000 to SV Probe Vietnam Co., Ltd...

According to Nguyen Thanh Nhan, Deputy Head of Management Board of provincial industrial parks, currently FDI enterprises operating in provincial industrial zones are invested in modern production lines, advanced technologies, typically mechanical enterprises, paint production ... Recently, some enterprises operating in the field of textile, dyeing have also invested in modern technologies such as dry dyeing, automatic textile production ... These are favorable conditions for domestic enterprises  to approach quickly modern technologies of the world.

Early removal of barriers

Clearly, the potential for access, technology transfer through FDI enterprises today is very large. However, there are still some barriers, which may include complicated policies, the cooperation between FDI enterprises and localities in the technology transfer is not good ... For example, according to regulations on technology transfer ,in investment dossier, enterprises have to explain technology, set out technology options... However, the new Investment Law does not have this specific requirement.

Mr. Nguyen Thanh Trung, Deputy Head of VSIP Management Board, said that at VSIP, most technology-transferring enterprises are mainly FDI enterprises, focusing on hi-tech industries and new technologies. However, the appraisal and certification for the preferential treatment for science and technology enterprises still takes time to complete, while the certificate period lasts only 5 years. Therefore, enterprises are not interested in technology transfer.

In addition, technology transfer from abroad into the country also involves the protection of intellectual property rights. At the same time, the sanction against violation is not deterrent enough. In particular, Decree 99 stipulates the sanction against administrative violations in the field of industrial property, the maximum fine level is only VND250 million to individuals and VND500 million to organizations; Decree 64 stipulates sanctions against administrative violations in scientific and technological activities, maximum VND50 million to individuals and VND100 million to organizations. These levels of administrative sanctions do not have a compensation mechanism, so the offending party is willing to pay fines.

According to Department of Science and Technology, in order to promote the technology transfer in general and technology transfer through FDI enterprises in particular, in the coming time, the province will promote the technology transfer through linkages, including the implementation of joint programs between foreign companies and local suppliers, namely in-depth consultancy, training and technology transfer to enhance process improvement and high specialization. At the same time, the province will strengthen the technology absorption capacity of enterprises through the training of skilled labor force and the interaction between enterprises and educational institutions and training units; R&D activities on technology in the locality will also be strengthened. Binh Duong also proposes the Central to revise legal normative documents issued by the Central Government for timely amendment and supplementation in order to ensure the implementation of technology transfer activities; adjust and amend supporting policies in technology transfer activities ...

From 2005 to April 2017, provincial Department of Science and Technology approved 24 foreign technology transfer contracts, of which 18 were in the supporting industry sector, 6 in the mechanical engineering sector and 1 domestic technology transfer contract.

Reported by Hoang Pham – Translated by Ngoc Huynh