Sunday, August 20, 2017 - 13:04:34

IZs, support sector link up to push growth

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Development of industrial clusters and zones (IZs) should be closely linked to the support industry sector, heard attendants at a conference in Hanoi on Nov. 23.

Jointly held by the Ministry of Planning and Investment's Central Institute for Economic Management (CIEM) and the United Nations Industrial Development Organisation (UNIDO) as part of an ongoing project, the conference was aimed at collecting ideas about how to boost industrial growth.

Tran Kim Hao of CIEM said the country has 260 IZs that provide jobs for around 3.5 million workers.

"However, some localities have developed IZs without strategic planning which has made sustainable development virtually impossible," Hao said.

He added that many support industries have a low localisation rate, despite preferential policies and encouragement.

"The number of support industry enterprises is low, thus increasing reliance on imports," he said.

Prof Nicola Coniglio from UNIDO and the University of Bari in Italy said the growth of a cluster will promote the development of support industries, and vice versa, and small- and-medium-sized enterprises in the clusters will then have opportunities to access investment and advanced production lines.

"Not all agglomerations can be supported and the Government should design a selection mechanism through which the potential clusters –directly or via provincial governments –reveal their interest in a collective initiative aimed at boosting competitiveness," he said.

He suggested analysing clusters while piloting a small number of dynamic clusters, adding that the role of local authorities is fundamental.

Head of EU Defensive Industrial Policy Tea Petrin shared how other countries have implemented policies that promote competitiveness and renewal.

She said development of IZs needs long-term policies that are regularly reviewed so they can be further enhanced.

Cluster development will also help improve domestic technologies and local economic structure while accelerating industrialisation and resolving other socio-economic issues, she added.

Statistics from the ministry showed that IZs have contributed to the country's industrialisation and modernisation process.

IZs and industrial clusters last year attracted 8,500 projects with more than 70 billion USD, creating industrial production value of 20 USD to 25 billion and accounting for up to 25 percent of the country's GDP.

Head of CIEM Le Xuan Ba said Vietnam 's sustainable development has been threatened by low competitiveness while the advantages of natural resources and cheap labour costs have been reduced.

"Promulgation of policies on cluster development and a legal framework to develop the network will promote Vietnam 's participation in global production chains," he said.

The project aims to develop policies to promote sustainable development for the country's growth./.

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