HCMC develops hardware industry

Ho Chi Minh City (HCMC) is a strong locality in terms of information technology (IT), which contributes considerably to Vietnam’s efforts to become a strong country in the world in this field. When developing IT, the city pays equal attention to software and hardware industries. To keep pace with new development trends, the city is boosting the hardware industry.

A report by the Vietnam Electronic Industries Association (VEIA) shows that in 2009, Vietnam exported more than US$2.77 billion worth of hardware products. Also in 2009, Ho Chi Minh City exported US$391 million worth of computers, electronic products and components, which accounted for 2.84 percent of the total export revenue of the city’s industrial products. In the first five months of 2010, the export revenue of the city’s hardware industry totaled US$203 million, up 30.3 percent compared with the same time of 2009. Ho Chi Minh City exports hardware products mostly to Japan, Singapore, China, Thailand and the US.

Pham Thien Nghe, the secretary general of the Ho Chi Minh City Computer Association (HCA) and the chairman of the Khai Tri Technology Group, said that in 2009 the market value of Vietnam’s hardware products totaled about US$6.4 billion and the added value that was created through activities such as providing IT consulting services and integrated solutions, import, wholesale and retail of hardware products was about US$1 billion. Notably, many small and medium-sized companies have taken active part in creating added value for hardware products to contribute to the development of the hardware industry. These companies have generated jobs for a considerable number of workers. The per-capita productivity in the hardware industry of Ho Chi Minh City is more than US$50,000 per year (the country’s average is US$38,000). In 2010, the market value of Ho Chi Minh City’s IT products is predicted to reach more than US$7.5 billion, 21 percent higher than in 2009. The results of a survey carried out by HCA at many IT companies show that retail sales of hardware products and services account for about 84 percent of the market value of IT products, i.e. about US$4.8 billion. This is why the hardware market of Ho Chi Minh City is very attractive to the multinational companies of other countries such as the Republic of Korea and the US.

To boost the growth of the hardware industry, Pham Thien Nghe said that stages of the hardware production process must be professionalized and it is necessary to build brands for hardware products. The government of Ho Chi Minh City is creating favorable conditions for the hardware industry to develop by granting licenses to foreign direct investment (FDI) projects in this field. At the same time, the city is facilitating the operation of the Ho Chi Minh City Hi-tech Park, the Quang Trung Software City and the Thu Thiem Hi-tech Park that will come into operation in the near future. Ho Chi Minh City will also support small and medium-sized hardware companies.

On the side of businesses, Nguyen Huu Le, the chairman of the board at TMA Solution, said that Ho Chi Minh City in particular and Vietnam in general must concentrate on R&D (Research and Development) activities when developing IT. In his opinion, environmentally friendly hardware products must be created. Appropriate policies must be put in place to encourage investment in R&D activities.

Le Ngoc Son, the president of VEIA, said that companies that trade in integrated IT solutions and small and medium-sized hardware companies must be offered preferences related to tax and capital.

It is hoped that in the future Ho Chi Minh City in particular and Vietnam in general will create more hardware products to meet both domestic needs and export demand. – VEN

Tags: Vietnam hardware industry