HCM City industry shows stability hinh anh 1The chemical, plastic and rubber industry grew significantly in 2017, with a year-on-year increase of 3.4 percent. (Photo: congnghiepcongnghecao.com.vn)

HCM City (VNA)Ho Chi Minh City’s industrial production was forecast to maintain steady growth in 2018 with the industrial production index (IIP) to rise about 8-8.5 percent against last year, according to the municipal Department of Industry and Trade.

Nguyen Phuong Dong, deputy director of the department, said that the manufacturing and processing sector was estimated to increase by 8.2 percent in 2018 while the electronic industry will also continue to grow well.

The department expects the mechanical engineering sector to develop remarkably in future. For example, the market-orientation of Mercedes-Benz is focusing on manufacturing in Vietnam to distribute to the ASEAN market. The market entry of Deahan Motor, Vinh Phat and SAMCO will also help contribute to the development of the city’s automobile industry.

However, enterprises are facing many difficulties and challenges, especially competitive pressure involved in deepening integration.

Ly Kim Chi, chairwoman of the HCM City Food and Foodstuff Association, said most enterprises in the association were small and medium-sized and faced many difficulties in capital, product output, production technology. These companies would find it difficult to compete with businesses in the ASEAN region, as they enjoy many incentives related to taxes, interest rates and other tools.

To accelerate the restructure of the industry, the department’s representative said that in 2018, the city would deploy more solutions to support businesses to develop production, especially supporting industry enterprises.

Le Nguyen Duy Oanh, deputy director of HCM City Centre of Supporting Industries Development, said this year, the centre would focus on supporting manufacturing enterprises to improve their supply capacity, expand production, approach domestic and foreign partners, step by step joining in the global supply chain.

Last year, the city’s IIP increased by 7.9 percent compared to 2016. Of this, the manufacturing and processing sector increased by more than 8 percent, four major industries increased by 13.9 percent, higher than the average rate of the industry sector and exceeding the target of 2017.

Dong said industrial production was showing stability in both the short and long term. Specifically, the IIP gradually rose in 2017 (up 6.02 percent in the first three months, 7.51 percent at half year, 7.84 percent at three quarters and 7.9 percent for the whole year).

In addition, he said, IIP had tended to increase gradually over the past five years (6.58 percent in 2013, 6.99 percent in 2014, 7.24 percent in 2015, 7.25 percent in 2016 and 7.9 percent in 2017).

Last year, the four key industries in the city achieved impressive growth. Notably, the electronic and information technology sector had remarkable growth. The IIP increased 39.11 percent compared to 2016 although there were only 260 enterprises operating in the city.

From August 2017 until now, the sector increased more than 30 percent due to the application of high level technology, science and technology at projects by the world’s leading economies (such as Samsung) in the field of semi-conductor technology, micro-chip technology and electronic boards. - VNA