Currently, Binh Duong province has 2,277 enterprises producing and trading support industry products

Shortage of domestic components, materials

According to the Binh Duong Department of Industry and Trade, the province located just north of Ho Chi Minh City has 2,277 enterprises producing and trading in support industry products, including 442 enterprises in garment, 172 businesses in leather and footwear, 953 companies in wood processing and 710 in mechanics.

Although the capacity of the support industry sector has been significantly improved, it meets only 40-45 percent of the textile and garment and leather and footwear sector’s needs, 10-20 percent of the car manufacturing and assembling needs; 15 percent of the electronics, information technology and telecommunications needs and five percent of specialized electronics and high technology needs.

According to the Binh Duong Textile and Garment Association, garment and textile export enterprises still prioritize the domestic supply of raw and auxiliary materials, but the response rate is still low. Meanwhile, for products requiring high technology, businesses must import from abroad to meet the strict requirements of customers, especially famous brands.

A representative of the Binh Duong Wood Association said that as the province’s main export industry, wood enterprises spend hundreds of millions of dollars to buy raw materials and auxiliary materials for production. Most of the auxiliary materials such as screws, paint and emery paper are provided by import enterprises.

Plans to boost localization

The Binh Duong Department of Industry and Trade is preparing to advise the provincial People’s Committee on steps needed to complete and supplement the legal basis and the investment stimulus program for supporting industries. The focus of the project is to formulate regulations for the implementation of supporting industry development programs, implement training programs, support and develop human resources, improve the management capacity of supporting industry enterprises and assess the localization rate.

In addition, Binh Duong is developing a separate industrial park in Bau Bang District on 1,000ha, and devising incentive policies to attract investment in the province, including supporting industry projects. The province has also introduced many policies to encourage business and production development of each product group, and has formed industrial zones and clusters to produce spare parts, components and materials for the industry sector. Moreover, the province has supported the participation of small and medium-size enterprises in the production of support products, such as components, spare parts and raw materials.

In order to create favorable conditions for the supporting industry enterprises, Binh Duong Department of Industry and Trade is also strengthening connections with business associations in response to the needs of enterprises, and coordinating with the Management Board of Industrial Parks to link supply and demand, helping support industry enterprises connect with domestic and foreign partners, expand markets, improve capacity and gradually join the global supply chain.