Comments for Decree on the development of supporting industries

Workshop on collecting comments on Ho Chi Minh city

In September and October 2014, the Ministry of Industry and Trade in collaboration with EU-MUTRAP held 2 consultation workshops and handed down comments on the draft decree on the development of supporting industries (SI) in Hanoi (September 25) and in Ho Chi Minh City (October 2).

Draft Decree on SI development is draft legal replaces Decision No. 12/2011/QD-TTg on development policy for SI and Decision 1483/QD -TTg issued priority products.

As representatives of the Ministry of Industry and Trade, Decree on construction is an urgent requirement for the current situation; the implementation of Decision 12/2011/QD-TTg and Decision 1483 / QD-TTg have problems constraints, firms are very difficult to access the incentives. After 3 years of implementation, only one project of Kyocera received preferential treatment under this Decision.

At the conference, besides the concurring opinions to the draft decree, businesses, associations and related agencies have some suggestions to modify and supplement Decree to complete before approving and implementing:

– Fiscal policy: The policy should focus on solving the problems: support import and export duties and simplify customs procedures, reducing the return time of Value Added Tax, rental tax assistance, corporate income tax, preferential interest rate.

– R&D policy: focus on supporting businesses to purchase machinery, new equipment, reduced import duty on machinery used in SI; avoid activities not applied directly in the production of enterprises.

– Human recourse policy: support training in business, training workers to meet actual needs, the support should not be limited to sending labors to centralized & abroad training.

– The state should have appropriate mechanisms to promote important downstream industries. Automotive, electrical-electronic sectors are the area that we should focus to support in the coming period. At the same time, the State should have appropriate mechanisms to promote larger assemblers in this area enhance the localization, creating markets for SI.

– Building the priority products list that Vietnam have the advantage, directly serving the downstream industry which oriented development, avoid spreading support that results low incentives, unattractive investment.

– Develop support mechanisms simply, easily and accessible; the comments focused on content: (1) A Decree must be passed soon & accompany with Circular on implementation guide; (2) the procedures to apply for preferential is simple: enterprises located in the priority groups will automatically receive preferential; avoid “ask for” mechanism; (3) the administrative procedures to implement Decree should be clarified, in particular, the execution time of administrative procedures, the agency should take responsibility for implementing the provisions of the legal documents.

Overall, businesses expressed their agreement with the policy was taken out in the draft Decree and desire Decree would soon be issued as a basis to support enterprises in this field. Summing up the conference, representatives of the Ministry of Industry and Trade to acquire the business comments to improve the draft decree before the Government issued.