Difficulties and challenges

According to the Ha Tinh provincial Department of Industry and Trade, the local supporting industry is currently only at the beginning stage. The biggest difficulty now is that the number of supporting industry enterprises is still limited, small in scale, with restricted production capacity, capital, and technology. They have only engaged in fields that do not require high technological levels.

Ha Tinh Province has identified supporting industry as one of the four major breakthroughs for the 2021-2030 period

In addition, most supporting industry enterprises in the province have not participated in the supply chain of operating FDI enterprises. Raw materials, components, and spare parts are mainly provided by FDI enterprises, key enterprises from import sources, parent companies, or from their home countries. Production linkages between enterprises in the province and FDI enterprises are also limited.

Specifically, because the textile-garment industry is a key industry to attract investment and create jobs for workers, in recent years, Ha Tinh’s garment industry has developed rapidly. There are more than 20 enterprises operating in the sector and over 1,100 small-scale garment establishments. However, currently, the development of the textile and garment supporting industry is still fragmented.

Textile and garment enterprises in the province mainly import raw materials and accessories for production, so the added value is low and the dependence is high.

As for the mechanical engineering industry, there are currently about 16 supporting industry enterprises in this group, with current production value having increased compared to the previous period, but most of the products are mainly processed to serve the Formosa Ha Tinh Steel Complex and Son Duong Port project; while the remaining products serve industrial and civil construction works.

As a garment export enterprise to the Japanese market, Ho Van Cat - Deputy Director of TAAD Ha Tinh Investment, Producing and Trading Joint Stock Company said: To serve production and meet the standards of partners, the company must import raw materials from Japan; some other materials such as thread and packaging must be imported from other provinces and cities in Vietnam. Currently, there is no companies in the province that produces accessories for the garment industry.

The company’s representative also expressed that, in addition to these imports from Japan, some accessories supplies, if any, from the province with qualified quality will be much more convenient for the company.

Supporting industry - a major orientation

In the provincial planning for the 2021-2030 period, with a vision to 2050, the province has identified “Supporting industry, steel-making industry, manufacturing of steel products and power generation” as one of the four major breakthroughs of the province’s development orientation.

Therefore, at meetings with large enterprises and corporations, Ha Tinh provincial leaders always emphasized that supporting industry is a priority for attracting investment.

In the coming time, the provincial People’s Committee will direct the development of supporting industry for advantageous industries, such as steel-making industry and products made from steel, automobile manufacturing industry, textile industry and anticipate electronic and high-tech industrial projects; create conditions for investors to build an automobile and auto part manufacturing complex in Vung Ang Economic Zone, and implement projects using steel raw materials from Formosa Iron and Steel Plant.

The province will also focus on attracting large projects applying advanced and modern technologies such as locomotive projects to promote the development of other industries and fields.