Hanoi (VNA) ꦑ– A shortage of capital support for the part supplying industry is hindering the development of the sector, which is crucial for the country’s economic development, participants at a forum said on May 31.

At the event held by the Institute for Industrial Policy and Strategy under the Ministry of Industry and Trade to discuss capital solutions for the part supplying industry, experts said that policy and capital support remained inadequate, which was seizing opportunities from firms. According to Nguyen Anh Son, the institute’s director, the industry was a major driver of the nation’s industrialisation progress, but investment in the industry did not parallel its achievements, given the tight State investment in the part supplying industry. In addition, complicated procedures made access to State financial support difficult while firms were thirsting for capital to invest in equipment and technology. Tran Van Quang, Deputy Director of the Local Science and Technology Development Department under the Ministry of Science and Technology, said at the conference that there were now several funds supporting part suppliers, but the access to incentives remained limited due to complicated procedures and high requirements. Quang said that bottlenecks in the operation of State funds in providing capital to the part supplying industry must be tackled, such as allowing firms to open accounts at commercial banks besides only the State Treasury, which is the current practice. Financial expert Can Van Luc said funds that supported small- and medium-sized enterprises, science and technology development and the part supplier industry must be used to enhance its operation efficiency. In addition, Luc said that commercial banks should have loan packages with preferential terms for part suppliers while the role of Vietnam Development Bank should be promoted. In November 2015, the Government issued a decree on developing the part supplying industry, which included policy support and incentives for the industry. Vietnam had about 1,380 businesses operating as part suppliers out of a total of 500,000 firms divided into the three groups of mechanics, electronics, and rubber and plastic.-VNA