Hanoi (VNS/VNA) - The Ministry of Industryand Trade (MoIT) has proposed a 100 trillion VND (4.31 billion USD)preferential credit package for the development of the country’s supportindustry.

The ministry says that Vietnamese support industry products could have high competitiveness,meeting 45 percent of essential demand and local consumption, and accountingfor 25 percent of total export value by 2020. The support industry plans tomeet 70 percent of local demand by 2030.

It also planned to have 1,000 firms capable of supplying products to assemblycompanies and multinational groups in Vietnam.

The local support industry would meet the requirements of localisation progressof production sectors including 40 to 45 percent for garment and textile, and leathershoes, and 10 to 20 percent to assembly of cars with fewer thannine seats.

To realise the set targets, the ministry has proposed a range of solutions interms of policies and market development for the support industry.

Accordingly, the Government should continue to build and complete policies topromote development of some key support industries. Policies to encouragelocalities to use their budgets for support industry would also be promulgated.

In addition, the Government should have mechanisms to develop some sectors suchas automobile, electronics, garment and textile, leather shoes and materialindustry.

Businesses should be given support to improve their capacity. The country wouldbuild three centres for the development of the support industry.

Preferential credit would also be given to the sector. Specially, the 100trillion VND credit package would have similar mechanisms to the credit packagefor hi-tech agriculture development. The package for hi-tech agriculturedevelopment has the participation of eight commercial banks. The banks wouldprovide loans to organisations and individuals who want to invest in clean andhi-tech agriculture. The interest rates would be 0.5 to 1.5 percentage pointslower than normal levels.

Prime Minister Nguyen Xuan Phuc assigned the Ministry of Planning and Investmentin co-operation with the Ministry of Finance to arrange capital to build thethree centres. The MoIT would study for the construction of the centres. TheState Bank of Vietnam would provide preferential mechanism on capital and loansto develop prioritised sectors within 5 to 10 years.

The Ministry of Science and Technology would consider adjusting accessmechanisms of the Vietnam National Fund for Science and Technology to make themsimpler for support industry firms. In addition, each locality should haveaction programmes to develop the support industry.

Statistics from the MoIT showed that Vietnam now has some 1,800 part suppliers.However, only 300 firms are in the supply chains of multinational groups.-VNS/VNA