The Ministry of Industry and Trade in Vietnam has come up with a draft decree intended to develop the support sector by offering the most attractive set of incentives to date to propel its growth.
The trade ministry said that the poor state of the support industry is leading to padded production costs, bigger trade deficits with overseas partners, and low competitiveness of Vietnamese products in the global market.
The draft decree for submission to the government offers a slew of enticing perks including exemption from business income taxes for companies taking part in the industry and for firms involved in the transfer of technology to the support industry, a 50 percent reduction in land rent for those located outside of industrial zones, and funding support for technical staff training, mass media campaigns, trademark registration, and participants to local and international trade fairs.
At the same time, a pilot program will be rolled out cutting by half the personal income tax of individuals in support industries who specialize in technology transfer and training, according to a report by the VietnamNet Bridge.
Other incentives: exemption from import duties for goods shipped into the country to build fixed assets for production and products of support industries, and preferential lending rates for projects in support industries.
The government will also push for the development of clusters in the support sector through a bevy of incentives for companies that join a cluster, as well as preferential policies for investments that aim to develop industrial clusters.
Moreover, support centers for building the sector will be put up nationwide to help reduce costs for companies in terms of hiring experts, product testing, and checking of product quality standards, among others.
The ministry said these policies are needed to develop the support industry before 2018 when the regional free trade agreement takes full effect.
Investing in inland waterways
As this developed, Vietnam’s Ministry of Transport plans to ask the government to implement policies to attract investments to inland waterway facilities.
Transport Minister Dinh La Thang disclosed to local media that he intends to make agencies and localities see the importance of inland waterways in facilitating transport.
In the Hong River Delta region, for instance, water transport has a huge potential because it involves 10 of the 18 main river routes in Vietnam with a total length of 1,550 kilometers of rivers and canals.
The region is also home to economic hubs such as Hanoi, Hai Phong, and Quang Ninh.
River transport carries about 25 percent of total goods transported in the region, and generally costs less than road or rail transport and can carry heavy loads.
Minister Thang said that to maximize river transport, he will prioritize projects that will open new routes and canals that link up with road and marine transport.
Photo: mikecogh
