Difficulties in implementing policies on supporting industries

Supporting enterprises introduced products at the Conference for supporting industry suppliers held on September 11 in Ho Chi Minh City. Photo: Nguyen Hue

According to Mr. Ngo Khai Hoan, Deputy Director of the Industry Department, Ministry of Industry and Trade, although there have been many policies to develop supporting industries such as Decree 111/2015/ND-CP dated November 3, 2015 and Decision 68/QD/-TTg dated January 18, 2017 of the Prime Minister, the implementation of these policies has been relatively difficult. Up to now, only a few localities have implemented it, but only at the promulgation of regulations. There have been no specific activities to promote the development of supporting industry in localities.

Preferential policies on the supporting industry are clearly defined in the list of supporting products in Decree 111/2015/ND-CP. Accordingly, at the local level, the received and certified incentives agency is a state management agency assigned by the provincial People's Committee in accordance with Article 15 of the Decree. In addition, the order of procedures to confirm incentives and post-incentive inspections also has detailed provisions in Circular 55/2015/TT-BCT of the Ministry of Industry and Trade issued on December 30, 2015.

However, it shows that the confirmation of incentives for enterprises in supporting industry in localities is very limited. There were very few localities implementing preferential certification such as Ha Nam and Quang Nam, the other businesses mainly send documents to the Department of Industry of the Ministry of Industry and Trade to confirm incentives. While the locality where the production facilities of enterprises are located, there has been no support for certification of incentives and preferential procedures for enterprises under the provisions of Decree 111/2015 / ND-CP. Therefore, the role of local management agencies for enterprises in the area is lacking.

According to Mr. Ngo Khai Hoan, the confirmation of incentives is necessary. Many enterprises do not know the incentive program they are entitled to propose for incentives, while many localities have not grasped or implemented the State's regulations and policies to provide incentives for enterprises in the field of supporting industry. Therefore, the authorities need to exchange and coordinate to disseminate the reception and confirmation of incentives for enterprises in supporting industry in the provinces.

“In recent years, the Department of Industry has implemented Decision 68/ QD-TTg of the Government, using the budget to perform a series of activities to support the development of supporting industries in all three regions of the North, Central and South. Through actual implementation, it is found that in the South, the coordination of organizing activities to support industrial development, consultancy to support industrialization is not really effective,” Mr Hoan said.

Regarding the above-mentioned issues, the representative of the Department of Industry and Trade of An Giang province said that the locality is currently taking steps to implement policies of supporting industry development in accordance with Decree 111/2015/ND-CP and Decision 68/QD-TTg. However, it is difficult to access these policies as many regulations are unclear.

Specifically, An Giang province has access to advanced machinery support programs for rural industrial facilities and initially promoted the effectiveness of technological innovation to improve productivity and quality. However, a number of regulations on supporting the renovation of technology transfer equipment are not clear, suggesting clarification so that the locality has a basis to propose funding for projects. Currently, the local fund is very low, so it will be more convenient for businesses if there are more projects with central budget support.

Regarding the confirmation of incentives for supporting industry enterprises, representatives of An Giang Department of Industry and Trade said that due to the lack of awareness about benefits of the evaluation and certification of incentives, the enterprises were not interested in that, so it was necessary to clarify the purpose of the evaluation of preferential enterprises so that the management agencies and local enterprises can clearly understand these policies.

Regarding the implementation of supporting industry development policies, the representative of the Department of Industry and Trade of Ho Chi Minh City said that Ho Chi Minh City enterprises have enjoyed many supporting policies of the city on training, connecting supply and demand, promotion and stimulating investment. However, the central support programs are still inadequate. According to the representative of Ho Chi Minh City Department of Industry and Trade, in order to effectively implement supporting industry development policies, it should be practical.

Typically, the supporting enterprises in Ho Chi Minh City are facing challenges in land fund because it is difficult for small and medium enterprises to access large land funds according to the plans in centralized industrial parks. Therefore, it is necessary to have a central policy on land fund that is suitable for supporting enterprises. The regulations on land support also need to be specified so businesses can get benefits. Similarly, it is also necessary to have preferential tax policies for only supporting enterprises.

"The accession of enterprises to participate in the supply chain of supporting enterprises is also facing many difficulties due to the limited consumption of FDI enterprises. The number of sold goods is low. Therefore, it is necessary to have investment-oriented solutions to support enterprises participating in the supply chains of FDI enterprises to take advantage of foreign investment activities.” The representative of Ho Chi Minh City Department of Industry and Trade said.