Key industrialisation planned for 2020

Five to seven industries will be selected as key national industries under a draft industrialisation strategy for the period from now until 2020, which is expected to be submitted to the Government by June.

At the recent fifth meeting in Hanoi of a special team charged with selecting the key industries, organised by the Central Institute for Economic Management (CIEM), participants agreed it is critical for Vietnam to set up an industrialisation strategy and proper action plans to transition from a low-income nation to an industrialised, middle-income country by 2020.

The list of key industries will be selected from 12 fields, including electronics, motor vehicles, shipbuilding, food processing, steel, petrochemicals, textiles and computer software.

A list of support industries will also be considered, mainly production industries such as engine manufacturing, flat steel products, agricultural products and raw materials including crude oil, composite plastics, artificial rubber, aluminium and synthetic fibres.

At the meeting, Minister of Planning and Investment Bui Quang Vinh said the industrialisation strategy and action plans toward 2020 and the list of key industries will play an important role in restructuring the national economy.

Minister Vinh said that improving the competitiveness of key industries needs to be part of the strategy, adding that the Government should call for international and domestic funding.

Sectors involved in the manufacturing of motorbikes, automobiles and heavy industries attracted the most attention at the meeting.

In terms of motorbike production, foreign experts said the high rate of local production – nearly 100 percent – made Vietnam the fifth largest motorbike market in the region and that domestic production could take advantage of this to export to South America and other Asian countries.

Meanwhile, several participants said a gradual process was needed to build domestic material industries such as petrochemicals and steel, in order to replace imported materials.

Other participants suggested that Vietnam focus on several other segments of the value chain and instead import materials from neighbouring countries in the region, arguing that industries producing such materials would require large amounts of capital and bring in low returns in the context of a fluctuating global market.

Many experts also noted bicycle and garment production as the strongest industries to develop.

Several participants said these two industries should be geared towards promoting exports, transfering technology, improving human resources and developing support industries.

Several foreign investors suggested the electronics sector is also one of the country’s key industries, while Japanese experts said Vietnam should establish a petrochemical zone in the southern provinces and a bicycle production area focused on exports in the central region.

Several northern provinces have been developed as bicycle production centres for the domestic market, while electronics production zones are being expanded in HCM City and Hai Phong.

Textiles, agricultural products, seafood and software have traditionally been some of the country’s leading exports, but there are doubts about the future of these industries.

Experts also say that the existing advantage of low-cost labour for garment and footwear producers will decrease in the future.

VNS/VOV

Tags: Vietnam industry, Vietnam indutries