Vietnam’s IT market needs a new breakthrough

Although the information technology market in Vietnam is developing rapidly, it has not made any major breakthroughs and few domestic consumers want to choose Vietnamese brand names.

Pham Thien Nghe, Deputy Chairman of the Vietnam Electronic Industries Association (VEIA) says that some Vietnamese IT businesses have not paid enough attention to creating their own individual trademarks. In addition, Vietnam’s IT products now have to compete with foreign ones in terms of price and quality.

In fact, IT products such as lap tops with Vietnamese trademarks such as FPT Elead, V-Open, CMS are built with almost all the components imported from abroad and assembled in Vietnam. In terms of quality, Vietnamese products are just as good as any product from Taiwan. However, in terms of price, on average Vietnamese computers are VND1 million cheaper.

Mr Nghe says that the difference in due to import taxes. Some components were removed from the import list this year. However, computer assembly plants have to pay for the difference in import tax between “components, electronics components, and a set of computer”.

For example, due to the globalization of computer manufacturing, almost all major computer producers have branches in China and can receive a certificate of origin (C/O form E) to enjoy a preferential import tax of zero percent under the ASEAN-China Free Trade Area (ACFTA). While Vietnam’s computer manufacturers have to pay an import tax of 3 percent for computer components. This means that the import tax for ready built computer is lower compared to the components.

In addition, Mr Nghe says that Vietnamese products have not produced popular designs and solutions for applications. He added that Vietnam’s IT businesses should not only pay attention to manufacturing but also to distribution networks and services.

It is necessary to invest in developing new designs, solutions for applications and building up trademarks. Taiwan’s IT industry has developed strongly and has been a major global IT market for several years thanks to these investments. For example, from a sector with simple production process, Taiwan’s IT sector has become a global industry which specializes in providing services and materials as well as conducting Research and Development (R & D) with the world’s leading IT brand names.

Ngo Van Vi, General Director of the Tan Binh Electronics Joint Stock Company says that almost all Vietnamese businesses have not paid enough attention to domestic policies or invested in supporting industries and R & D. Therefore, it is essential to develop R&D to establish Vietnamese trademarks. Mr Nghe suggested that the State pour investment into the Vietnam Institute of Software and Digital Content Industry (NISCI) for R & D to support businesses.

In addition, to help domestic businesses improve their competitive edge, the VEIA proposed 5 percent VAT imposed on domestic electronic products and 10 percent on imported computers. This would help domestic products in the home market. – VOV

Tags:

Posted by VBN on Oct 29 2010. Filed under Technology. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

You must be logged in to post a comment Login

Stay informed everyday

Subscribe to free RSS and email updates from Vietnam Business News

Subscribe via Email Subscribe in a Reader Follow us on Twitter Connect on Facebook

RSS China Business News

  • Copper up, but demand jitters cap gains
  • Gold prices fall 1 percent, silver was down 0.5 percent at $41.40 an ounce
  • Gold price in Hong Kong opens at 17,440 HK dollars per tael on Wednesday
  • Gold sheds 3 pc in choppiest day in two weeks
  • Appliance retailers eye shopping fest to boost sales
  • Stock break four-day losing streak
  • Swedish auto maker Saab files for bankruptcy protection
  • Chinese tourists to Sri Lanka almost double

Sponsored

Looking for an overseas forex broker?