Resolution No. 115/NQ-CP 2020 solutions to promote the development of supporting industries

RESOLUTION

On solutions to promote the development of supporting industries^[1]

THE GOVERNMENT

Pursuant to the June 19, 2015 Law on Organization of the Government;

In furtherance of instructions of Prime Minister Nguyen Xuan Phuc at the December 19, 2018 Conference on solutions to promote the development of Vietnam’s supporting industries;

At the proposal of the Minister of Industry and Trade;

Based on voting results of the cabinet members,

RESOLVES:

I. SITUATION AND CAUSES

1. Supporting industries are of important significance to restructuring the economy toward industrialization and modernization, helping raise labor productivity and competitiveness, create added value, and increase the contribution ratio of the processing and manufacturing industries in the country’s economic structure. To develop supporting industries is one of the most important solutions for Vietnam to raise the quality of its economy, develop in a sustainable manner, and avoid the middle-income trap; increase its attractiveness to foreign direct investment (FDI), boost the acquisition and transfer of technologies and the development of domestic small- and medium-sized enterprises. Thereby, a strong spillover effect will be created to help domestic enterprises participate deeply in the supply chains of FDI enterprises and the global value chains of multinational groups.

Over the past time, the Party and the State have paid special attention to supporting industries and give priority to their development and investment. Since the issuance of the Government’s Decree No. 111/2015/ND-CP of November 3, 2015, on development of supporting industries, and relevant legal documents, the system of laws and policies on supporting industries has been further strengthened, contributing to their development and growth. Specifically, the quantity and quality of Vietnamese enterprises engaged in supporting industries have significantly been increased. Products of supporting industries have met to some extent the domestic demand and been exported to many countries around the world. A number of domestic enterprises engaged in supporting industries have applied modern management tools in production activities according to international standards and become suppliers for multinational companies.

2. However, Vietnamese enterprises engaged in supporting industries still reveal weaknesses and limitations and face new problems. The implementation of some incentive and support policies remains difficult, inconsistent and unstable. The policies on development of the processing and manufacturing industries prioritized for development, such as electronics, key mechanical engineering, automobile manufacture and assembly, textile-garment, and footwear, etc., for creating a market for supporting industry products, still fail to bring about goods results as expected. Supporting industry products remain simple with low or medium technological content accounting for a small ratio in their value structure. The capacity to self-provide supporting industry products remains inadequate. Imported raw materials, components and spare parts create a great trade deficit and the industrial localization remains low. Vietnamese enterprises engaged in supporting industries still have many limitations in production management capacity and technology; lack resources for innovation; are engaged in similar production fields in terms of level, scale, technology and product; and are incapable of supplying components and spare parts satisfying requirements for deeper participation in the global production chains.

3. The above limitations are attributed to various causes, objective and subjective. Specifically, Vietnam has no enterprises leading regional or international production chains that can play a development-leading role and can exert a spillover effect in the industrial sector. The domestic market remains small, failing to ensure the manufacturing scale of supporting industry products while the export market is fiercely competitive. Vietnam has almost no key industrial products that are able to compete with imported ones while lacking basic manufacturing materials. Its small- and medium-sized enterprises have a low starting point and a weak capacity, failing to satisfy the demands of global production chains and customers.

In addition, the State’s investment resources and supports for the processing, manufacturing and supporting industries are inadequate, ineffective and disproportional to their size and role. Awareness about the role of the processing and manufacturing industries in nurturing revenue sources and building up the internal strength and resilience of the country in the long term remains limited. Methods of balancing resources, including allocation of resources and making of policies for industrial development, remain short-term and not fully conformable with the development orientations set out by the Party and the State. Policies on development of supporting industries have been issued late and are still incomplete and impractical although the Party and the State have identified the role and position of supporting industries in socio-economic development in the January 28, 2016 Resolution of the XII^th National Party Congress and the 2011-2020 socio-economic development strategy. Moreover, the implementation of these policies by various ministries, sectors and localities remains uncoordinated, inconsistent and ineffective, failing to meet the requirements of practical development. Officials in many localities still have limited capabilities and lack proactiveness and creativeness; the analyzing, forecasting and inventorying capacity remains weak.

In order to remove difficulties and problems in the mechanisms and policies related to supporting industries, improve the investment and business environment, attract investment and receive the production shift of multinational companies and, at the same time, create favorable conditions for enterprises engaged in supporting as well as processing and manufacturing industries to develop and raise their competitiveness, the Government requests ministers, heads of ministerial-level agencies, chairpersons of provincial-level People’s Committees, and heads of related agencies to direct and organize the performance of the following tasks:

II. GUIDING VIEWPOINTS AND OBJECTIVES

1. Guiding viewpoints

- To develop supporting industries in conformity with the country’s socio-economic development conditions and the global development trend with a view to satisfying the domestic demands of the industries prioritized for development in accordance with the Political Bureau’s Resolution No. 23-NQ/TW, including electronics, key mechanical engineering, automobile manufacture and assembly, textile-garment, footwear, hi-tech industries, and defense industry.

- To develop supporting industries on the basis of creating competitive edge over other countries in the region and the world so as to attract investment, approach and satisfy the demands of multinational groups, and extensively and intensively participate in the global production networks and value chains in these fields.

- To develop supporting industries in a harmonious and sustainable manner, focusing on in-depth development with breakthrough priorities to create industrial development spearheads, ensuring sustainable development and environmental friendliness.

- To develop supporting industries on the basis of mobilizing resources from all economic sectors, especially from foreign-invested enterprises and local small- and medium-sized enterprises.

2. General objectives

By 2025, Vietnamese enterprises will be able to manufacture highly competitive supporting industry products that can satisfy 45% of essential domestic production and consumption demands and will account for some 11% of the production value of the entire industrial sector. There will be around 1,000 enterprises capable of supplying their products directly to assembling enterprises and multinational groups operating in Vietnam, of which domestic enterprises will make up about 30%.

By 2030, supporting industry products will satisfy 70% of domestic production and consumption demands and will account for some 14% of the industrial production value. There will be around 2,000 enterprises capable of supplying their products directly to assembling enterprises and multinational groups operating in Vietnam.

3. Specific objectives

a/ Regarding components and spare parts: To develop metal, plastic-rubber, and electric-electronic components and spare parts, so that by 2025, these products will satisfy 45% of the demands of various industries in Vietnam. By 2030, these products will satisfy 65% of domestic demands while the manufacture of products for hi-tech industries will be promoted.

b/ In the supporting industries for the textile-garment and footwear industries: To develop raw materials, materials and auxiliary materials serving the textile-garment and footwear industries so that by 2025, the rate of domestic supplies for the textile-garment industry will reach 65%; this rate will be 75-80% for the footwear industry with products of high added value serving export production.

c/ In the industries supporting hi-tech industries: To develop the manufacture of materials, special-use support equipment, software and services for hi-tech industries; to develop a system of enterprises supplying special-use support equipment and technology transfer support equipment in hi-tech industries. To form international-standard machinery maintenance and repair service enterprises as a premise for development of enterprises manufacturing equipment and software for these industries. To form a system of research and development (R&D) and manufacture of new materials, especially electronic materials.

III. GENERAL TASKS AND SOLUTIONS

1. Completing mechanisms and policies: To develop, improve and effectively and synchronously implement special mechanisms and policies for development of prioritized supporting industries and processing and manufacturing industries (which are eligible for the State’s incentives and support under the Law on Investment), thus facilitating the development of supporting industries and the formulation and effective implementation of policies for material industries and development of markets for complete product-manufacturing and assembling industries in order to create an essential foundation for modernity and sustainability-oriented industrialization.

2. Ensuring and effectively mobilizing resources for supporting industry development: To arrange, ensure and effectively mobilize resources for implementation of investment policies to develop prioritized supporting industries and processing and manufacturing industries. To raise the role of, and encourage localities to invest resources for implementation of policies, programs and activities to support enterprises engaged in prioritized supporting industries and processing and manufacturing industries in conformity with law and local socio-economic conditions.

3. Finance-credit solutions: To further implement policies on interest rate incentives for enterprises engaged in prioritized supporting industries and processing and manufacturing industries to borrow short-term loans from credit institutions. The State shall offset interest rate differences for medium- and long-term loans borrowed by enterprises for execution of projects to manufacture products on the list of products of prioritized supporting industries with central budget or local budget funds, ODA and foreign concessional loans.

4. Developing domestic value chains: To create opportunities for the formation and development of domestic value chains through effectively attracting investment and promoting business connection and linkage between Vietnamese enterprises and multinational groups as well as domestic and foreign manufacturing and assembling companies. To build concentrated zones of supporting industries to form industrial clusters; to develop material industries with a view to enhancing the self-supply of input materials for production activities, reducing dependence on imported materials and increasing the domestic added value and competitiveness of Vietnamese products and lifting the position of Vietnamese enterprises in the global value chains. At the same time, to promote the development of complete product-manufacturing and assembling industries and provide support for Vietnamese enterprises in prioritized processing and manufacturing industries to grow into regional-scale groups which can motivate and lead the development of supporting industry enterprises in the spirit of the Political Bureau’s Resolution No. 23-NQ/TW on orientations for the formulation of national industrial development policies through 2030, with a vision to 2045.

5. Market development and protection: To boost the development of domestic and foreign markets to facilitate the development of prioritized supporting industries and processing and manufacturing industries. Specifically, to ensure the size of the domestic market through taking solutions to develop prioritized processing and manufacturing industries on the principle of ensuring economic efficiency; to develop and enforce a system of technical regulations and standards in industry with a view to protecting domestic production and consumers; to increase quality inspection of imported industrial commodities and use technical barriers for reasonably protecting the domestic market in conformity with international commitments and practices. At the same time, to seek and expand overseas markets on the basis of the signed free trade agreements (FTAs); to take measures to help enterprises engaged in prioritized supporting industries and processing and manufacturing industries to effectively benefit from the FTAs; to actively remove barriers and combat acts of monopoly and unfair competition; to develop modern forms and modes of trade.

6. Building capacity for supporting industry enterprises: To build and effectively operate regional and local technical centers to support industrial development with the central and local budgets’ medium-term investment funds based on development demands and objectives and available resources with a view to helping enterprises engaged in prioritized supporting industries and processing and manufacturing industries to carry out innovation, R&D and technology transfer, and raise their productivity, product quality and competitiveness so that they can deeply participate in the global production chains. To adopt incentive and support mechanisms and policies on finance, infrastructure and physical foundations for raising the capacity of regional technical centers to support industrial development. These centers will play the role of linking local centers of this kind, thus forming a common ecosystem of technology and industrial production.

In addition, efforts need to be concentrated on raising the scientific and technological capacity of enterprises engaged in prioritized supporting industries and processing and manufacturing industries in order to create breakthroughs in the areas of technological infrastructure and technology transfer and improve the technology absorption capacity of supporting industry enterprises. To enhance domestic and international cooperation in research, development and application of science and technology as well as trading and transfer of scientific and technological products. To step up the commercialization of scientific research and technological products; to enhance public-private cooperation in the implementation of technology innovation and R&D projects. Furthermore, to develop the workforce of supporting industries and processing and manufacturing industries through national programs and plans on improving occupational skills, promoting linkage between training institutions and enterprises, linking vocational education with the labor market, developing vocational education management and quality assurance systems, applying a modern, streamlined and professional management model up to international standards and based on information technology, and promoting international cooperation in training and developing human resources and developing systems for evaluation of occupational skills and grant of national occupational skills certificates, especially for important occupational skills in supporting industries.

7. Information-communications, statistics and databases: To build and complete systems of statistics and databases on prioritized supporting industries and processing and manufacturing industries in order to promote connection between Vietnamese suppliers and multinational groups and increase the effectiveness and efficiency of the state management and formulation of policies on supporting industries; to raise the quality of statistical work, ensuring provision of prompt, sufficient and accurate information. To step up communication and information about prioritized supporting industries and processing and manufacturing industries with a view to drawing attention and changing and raising the awareness and responsibility of authorities at all levels, sectors, localities as well as the entire population about the development of supporting industries and processing and manufacturing industries.

IV. TASKS TO BE PERFORMED IN ASSOCIATION WITH RESPONSIBILITIES OF MINISTRIES, SECTORS AND LOCALITIES

1. The Ministry of Industry and Trade shall:

- Assume the prime responsibility for, and coordinate with related ministries and sectors in, revising the Government’s Decree No. 111/2015/ND-CP of November 3, 2015, on development of supporting industries, to meet practical requirements of supporting industries while ensuring uniformity with the investment and tax laws and conformity with the Law on Support for Small- and Medium-sized Enterprises.

- Review and modify the program on development of supporting industries under the Prime Minister’s Decision No. 68/QD-TTg of January 18, 2017, and submit it to the Prime Minister for approval, ensuring satisfaction of the industry’s development requirements.

- Develop a strategy on development of the textile-garment and footwear industries through 2030, with orientations toward 2035; formulate a program on sustainable development of the textile-garment and footwear industries during 2021-2030 with a view to removing the “bottlenecks” in raw materials and auxiliary materials, human resource training, and application of Industry 4.0’s technologies in designing and production activities; build “green” textile-garment and footwear industries so as to make the most of the signed FTAs.

- Study and propose policies to boost the development of a number of prioritized industries with a view to creating a market for supporting industries to develop, which are suitable to the characteristics of each industry.

- Coordinate with the Ministry of Planning and Investment in promoting the  attraction of investment from major global FDI enterprises in order to make use of their investment shift in the new context; encourage complete product-manufacturing FDI enterprises to open their regional-level plants in Vietnam so as to help domestic supporting industry enterprises to join the supply chains of multinational groups.

- Intensify international cooperation, expand markets, and make the most of market advantages of the signed FTAs; help supporting industry enterprises build their capacity through technology transfer and human resource training cooperation.

- Assume the prime responsibility for, and coordinate with the Ministry of Planning and Investment in, designing a scheme on pilot construction of industrial parks in several localities after the model of industrial clusters for manufacturing components and spare parts of prioritized processing and manufacturing industries, such as manufacturing key electronic and mechanical products; manufacturing and assembling cars as well as important raw materials and auxiliary materials for the textile-garment and footwear industries, e.g., fiber, cloth, leather and new materials; submit to the Prime Minister or consider and decide on support mechanisms based on local budget funds (expenses for ground clearance,  construction of environment treatment facilities, worker dormitories, etc.) and incentives for each project in accordance with the Law on Investment and relevant guiding documents.

- Coordinate with the Ministry of Finance (the General Department of Customs) and related ministries and sectors in establishing inter-agency working teams to inspect the origin of exports and imports eligible for tariff preferences in conformity with international practices.

- Coordinate with related ministries and sectors in effectively controlling transfer pricing and tax fraud; and actively remove barriers and prevent acts of monopoly and unfair competition.

- Work out a scheme on application of digital technology and advanced techniques to serve the traceability of industrial products in the prioritized industries and submit it to the Prime Minister for approval in order to step up quality inspection of imported goods and reasonably protect the domestic market in conformity with international commitments and practices with regard to industrial commodities; and raise the quality and effectiveness of market inspection and control activities.

- Develop big central databases on the prioritized industries, attaching importance to developing databases on enterprises manufacturing supporting industry products and creating conditions for them to access necessary information in a fast and convenient manner to serve analysis, evaluation and selection of sectors and trades for investment.

- Coordinate with ministries, sectors and the mass media in promoting communication about and advertising of supporting industry activities in a comprehensive and long-term manner and increasing information about the formulation and implementation of policies on prioritized supporting industries and processing and manufacturing industries.

- Build 5 regional technical centers to support industrial development, including 3 ones to support development of mechanical engineering and electronics and 2 R&D centers for the textile-garment and footwear industries with a view to supporting innovation, trial production and quality inspection for enterprises, with public investment funds allocated for the 2021-2015 period, in Hanoi, Ho Chi Minh City and localities with advantages for the development of processing and manufacturing industries. For these centers, the Prime Minister shall consider and decide on special incentive and support mechanisms to be implemented on a pilot basis (state budget funds for the construction of physical foundations and procurement of technical equipment and machinery to serve the transfer of manufacturing technologies and techniques, and tax and charge breaks under current regulations, etc.) on the basis of the scheme formulated by the Ministry of Industry and Trade.

2. The Ministry of Planning and Investment shall:

- Study and propose competent authorities to issue policies to ensure the macroeconomic stability and reasonable organization and structure of markets in conformity with the objective law so as to facilitate the distribution of social resources for industrial development in conformity with the market principles.

- Review and adjust the operation mechanism of the Small and Medium Enterprise Development Fund to help supporting industry enterprises easily access funding sources.

- Study and unify the planning of land use for and the licensing of large-scale industrial parks with textile and garment industries.

- Study and formulate policies to provide concessional loans for investment in building centralized parks for supporting industries in order to form industrial clusters; develop material industries.

- Assume the prime responsibility for, and coordinate with ministries and sectors in, proposing the allocation of medium-term and annual public investment funds to competent authorities for approval so as to offset interest rate differences for credit institutions to provide concessional loans for enterprises engaged in prioritized supporting industries and processing and manufacturing industries which are eligible for investment support under the Law on Investment.

- Study and formulate policies to attract large-scale FDI projects in association with development policies of domestic suppliers based on levels of enjoyable incentives and supports; call for strategic investors and multinational groups to invest, open their offices, and establish R&D centers and innovation centers in Vietnam.

- Promulgate regulations and criteria on FDI attraction:

+ To take into account the planning of territorial areas, sectors and trades for investment attraction; to decentralize the powers to approve investment and grant investment registration certificates for FDI projects so as to avoid overlaps and ensure synchrony and consistency in socio-economic development master plans for localities and economic regions;

+ To avoid licensing small-scale FDI projects to manufacture components and spare parts with low technological content, which apply outdated and polluting technologies or use lots of natural resources.

- Assume the prime responsibility for, and coordinate with the Ministry of Industry and Trade in, building a system of statistics on prioritized supporting industries and processing and manufacturing industries and periodically announce such statistics.

- Effectively carry out activities to support small- and medium-sized enterprises in prioritized supporting industries and processing and manufacturing industries in accordance with the Law on Support for Small- and Medium-sized Enterprises.

- Include development investment funds for building physical foundations for 5 technical centers to support industrial development in the key economic regions in the 2021-2025 medium-term public investment plan.

3. The Ministry of Finance shall:

- Improve and simplify tax-related policies and procedures so as to facilitate the development of enterprises engaged in prioritized supporting industries and processing and manufacturing industries.

- Propose a competent authority to promptly amend the Law on Value-Added Tax toward adjusting the value-added tax refund mechanism and time so as to facilitate access to capital for enterprises engaged in prioritized supporting industries and processing and manufacturing industries.

- Revise excise tax policies (regarding taxable prices) for automobile products with a view to encouraging the automobile manufacturing and assembling industry to increase the added value created in the country and submit the revisions to the XIV^th National Assembly’s 10^th session as instructed by the Government in Resolution No. 93/NQ-CP of June 11, 2020.

- Review and formulate mechanisms and policies to support export processing enterprises in selling their products and participating in domestic supply chains.

- Assume the prime responsibility for, and coordinate with the Ministry of Natural Resources and Environment in, creating a mechanism for charging the  disposal of discarded products, for imported products; assume the prime responsibility for, and coordinate with local People’s Committees in, creating mechanisms for disposal of discarded products, for home-made products, in accordance with the law on environmental protection’s provisions on recall and disposal of discarded products.

- Allocate 3-year medium-term and annual non-business funds to ensure the effective implementation of the Program on development of supporting industries approved under the Prime Minister’s Decision No. 68/QD-TTg of January 18, 2017.

- Guide localities in formulating programs on provision of concessional loans for enterprises engaged in prioritized supporting industries and processing and manufacturing industries in accordance with the Law on the State Bank of Vietnam, Law on Credit Institutions and other relevant current laws.

- Prioritize the allocation of ODA and concessional loans of donors:

+ Arranging concessional loans and offering interest rate support for enterprises engaged in prioritized supporting industries and processing and manufacturing industries;

+ Building technical centers to support industrial development;

+ Implementing technical assistance projects on human resource training and building capacity for enterprises.

- Assume the prime responsibility for, and coordinate with the State Bank of Vietnam and Ministry of Industry and Trade in, formulating and submitting to the Prime Minister for issuance policies on provision of interest rate differences for enterprises engaged in prioritized supporting industries and processing and manufacturing industries to take loans from commercial banks. The interest rate difference to be provided by the state budget will be 5%/year at most.

- Coordinate with the Ministry of Planning and Investment and related ministries and sectors in allocating the 2021-2025 medium-term public investment funds for provision of concessional loans for enterprises engaged in prioritized supporting industries and processing and manufacturing industries in accordance with the Law on Investment.

- Guide the provision of interest rate differences for commercial banks providing concessional loans for enterprises engaged in prioritized supporting industries and processing and manufacturing industries.

- Assume the prime responsibility for, and coordinate with related ministries and sectors in, effectively controlling transfer pricing and tax frauds so as to create a fair competitive environment.

- Coordinate with the Ministry of Planning and Investment in allocating medium-term public investment funds for building physical foundations to form 5 technical centers to support industrial development through 2025.

4. The State Bank of Vietnam shall:

- Review and adjust credit policies for supporting industries, ensuring effectiveness and helping supporting industry enterprises have easy access to concessional loans.

- Assume the prime responsibility for, and coordinate with ministries, sectors and local People’s Committees in, guiding and directing credit institutions to provide concessional loans through providing interest rate differences from state budget funds as well as foreign ODA and concessional loans.

- Include the demands of credit institutions for provision of interest rate differences in order to provide interest rate differences for enterprises engaged in prioritized supporting industries and processing and manufacturing industries in medium-term and annual public investment plans and send them to the Ministry of Finance and Ministry of Planning and Investment.

- Encourage credit institutions to arrange credit and develop credit programs as appropriate for supporting industry enterprises, especially small- and medium-sized ones; combine the appraisal of the eligibility to provide loans for clients with the counseling on financial solutions suitable to the characteristics of each enterprise.

5. The Ministry of Information and Communications shall:

- Direct the press and publishing agencies and grassroots information systems to increase information and communication about the Party’s guidelines and the State’s policies and laws in order to boost the development of prioritized supporting industries and processing and manufacturing industries; direct radio and television broadcasters to increase the time slots for programs on prioritized supporting industries and processing and manufacturing industries, which must account for at least 10% of the total time volume for broadcasting information about essential political and information and communication tasks of the country and localities, aiming to introduce to the public the formulation and implementation of policies as well as activities of enterprises engaged in prioritized supporting industries and processing and manufacturing industries; place orders for press agencies to produce information promoting the development of supporting industries.

- Propose and recommend breakthrough policies and mechanisms on application of information technology in operations of state agencies and enterprises for boosting the application of e-government, reform of administrative procedures, and development of information technology application in prioritized supporting industries and processing and manufacturing industries, ensuring synchrony, uniformity and integration, toward centralized national databases serving the management and administration work of administrations at all levels; ensure publicity and transparency in the receipt and handling of reports and settlement of petitions of enterprises.

- Study and formulate mechanisms, policies and solutions on development of supporting industry enterprises operating in the fields of information technology and telecommunications and electronics industries, giving priority to the development of enterprises engaged in supporting industries to manufacture products with 5G technologies, Internet of Things (IoT), artificial intelligence (AI), robotic, etc.

6. The Ministry of Natural Resources and Environment shall:

- Coordinate with the Ministry of Finance and related ministries and sectors in, studying and proposing the supplementation and completion of land-related incentive policies and supporting the handling of environmental issues for projects manufacturing supporting industry products on the List of products of supporting industries prioritized for development; and land access support policies meeting the requirements of the industries manufacturing supporting industry products.

- Assume the prime responsibility for, and coordinate with related ministries and sectors in, formulating and submitting to competent authorities for revision in 2020 legal documents on the recovery and disposal of discarded products in accordance with the law on environmental protection on the principle of holding importers responsible for disposal of discarded products of electronics and automobile industries through payment of charges for disposal of discarded products upon import and refund upon complete disposal of discarded products.

- Review and adjust national technical regulations on industrial wastewater of a number of prioritized processing and manufacturing industries and supporting industries as suitable to the reality and capacity of domestic enterprises as well as the country’s technical and technological level and socio-economic development level in each period. All environmental parameters and indicators shall be adjusted to ensure harmony with and equivalence to those of regional advanced countries like Japan and Republic of Korea, etc., in order to meet the international integration requirements and restrict the transfer of projects using outdated, polluting technologies into Vietnam, thus step by step improving the environmental quality.

- Review and supplement the list of environmental protection activities eligible for preferences and supports issued together with the Government’s Decree No. 19/2015/ND-CP of February 14, 2015, detailing a number of articles of the Law on Environmental Protection, by supporting textile and dyeing and leather tanning projects investing in wastewater systems; producing clean and renewable energies; manufacturing, importing and using renewable energy-operated machinery, equipment and vehicles; producing and using environment-friendly products and services with eco-labels; or applying the circular economy model and optimal technologies in production and business activities.

- Formulate and submit to the Prime Minister for approval solutions to support supporting industry enterprises in environmental treatment activities, especially in the textile-garment and footwear industries (textile and dyeing and tanning, etc.).

7. The Ministry of Science and Technology shall:

- Review and adjust mechanisms for access to the National Technology Innovation Fund and National Foundation for Science and Technology Development to be more open and simpler for supporting industry enterprises.

- Assume the prime responsibility for, and coordinate with related ministries and sectors in, reviewing, revising, formulating, appraising and declaring national standards; appraising draft national technical regulations with regard to products of the supporting industries of the automobile, mechanical engineering, electronics, textile-garment and footwear industries, and increasing harmony with international standards and ensuring conformity with international and regional commitments and relevant regulations.

- Prioritize support for and performance of national-level scientific and technological tasks in the supporting industries.

- Intensify the provision of counseling on, seek, introduce and support the transfer of modern manufacturing technologies and develop intellectual assets; support the establishment and application of advanced management systems and instruments for increasing productivity and quality, especially instruments in support of smart manufacturing, thus helping raise labor productivity, quality of products and goods and efficiency of production and business activities of supporting industry enterprises to meet the requirements of complete product-manufacturing and assembling enterprises.

- Assume the prime responsibility for, and coordinate with related ministries and sectors in, popularizing, and guiding supporting industry product-manufacturing enterprises to apply, national standards, foreign standards, regional standards and international standards in the supporting industries.

- Earmark land areas for building a technical enter to support industrial development in Hoa Lac Hi-tech Park to serve technology research and transfer activities and raise the manufacturing capacity of enterprises engaged in prioritized supporting industries and processing and manufacturing industries in accordance with law.

- Develop national data on national standards, national technical regulations, foreign standards, regional standards and international standards and data on organizations conducting experimentation, certification, testing and calibration related to supporting industries.

8. The Ministry of Labor, Invalids and Social Affairs shall:

- Assume the prime responsibility for, and coordinate with the Ministry of Education and Training in, encouraging young people to study at vocational education institutions so as to meet the labor market demands for skilled human resources and the demands of enterprises, ensuring a balanced structure of holders of graduate, postgraduate and college, intermediate and elementary degrees.

- Develop systems for evaluation of occupational skills and grant of national occupational skills certificates, especially important occupational skills in supporting industries; form national occupational skills councils for developing national occupational skills standards, forecasting demands for occupational skills and future skills to meet the society’s demands for supporting industries.

- Step up international cooperation (with the Republic of Korea, Japan, Australia, Germany, etc., and international organizations) in training and developing the supporting industry workforce.

- Coordinate with the Ministry of Industry and Trade in providing training for workers directly engaged in supporting industries.

- Assume the prime responsibility for, and coordinate with the Ministry of Education and Training, other ministries, sectors and localities in, stepping up the work of forecasting the labor market demand, especially for supporting industries, ensuring a balanced structure of engineers and bachelors in scientific and technical sectors and skilled technical workers.

- Issue documents on occupational skills up to international standards, attaching importance to training processes and methods, and systems of certificates to meet the labor exchange demand in the region and the world.

- Simplify procedures for certification of training programs in association with market economy development factors.

- Formulate policies to promote supporting industry enterprises to proactively participate in vocational training activities, and form close and appropriate links between vocational training programs and skills requirements of the labor market.

9. The Ministry of Transport shall:

- Study and improve national technical regulations on technical safety and environmental protection quality, especially technical regulations on vehicle emissions; at the same time, take measures to closely control and impose strict penalties on vehicles that fail to comply with emission regulations.

- Study and report to the Prime Minister a roadmap for application of emission standards to automobiles in conformity with the actual development of Vietnam’s automobile industry.

- Coordinate with related ministries and sectors in studying and proposing regulations on disposal of discarded products in the transport sector.

- Complete procedures for inspection, experiment and certification of technical safety and environmental protection quality for domestically manufactured and imported automobiles so as to create favorable conditions for enterprises.

- Strengthen quality control measures for imported automobiles in complete units while limiting the import of inferior-quality products into Vietnam’s market and trade frauds.

- Speed up infrastructure projects and apply comprehensive modes of transport with a view to cutting logistics costs and increasing the competitiveness of industrial products and supporting industry products.

10. The Ministry of Home Affairs shall:

- Assume the prime responsibility for, and coordinate with the Ministry of Industry and Trade in, guiding the order and procedures for the establishment of regional and local technical centers to support industrial development.

- Permit joint venture enterprises and foreign-invested enterprises in mechanical engineering, electronics, textile-garment, footwear, supporting industries and other manufacturing industries to join associations as official members pending the revision of the Government’s Decree No. 45/2010/ND-CP of April 21, 2010, on the organization, operation and management of associations.

11. Provincial-level People’s Committees shall:

- Further proceed with reform of administrative procedures and raise the quality of human resources for supporting industries at all levels and in all sectors. Encourage enterprises in localities to expand linkage and cooperation in production and business activities with large domestic and foreign partners, first of all foreign investors, so as to attract investment capital while tapping opportunities for technology transfer and renewal and participating in the global value chains.

- Formulate and submit to provincial-level People’s Councils for promulgation or revise policies to attract domestic investment and FDI subject to the condition of increasing locally added value, taking into account the territorial space linkage.

- Based on their advantages in the development of prioritized supporting industries and processing and manufacturing industries, the provinces and centrally run cities shall:

+ Develop and issue their local programs on development of supporting industries;

+ Allocate annual budget funds for implementation of their local programs on development of supporting industries;

+ Improve the organizational structures and build capacity of provincial-level Departments of Industry and Trade and related units to carry out activities for industrial development and development of supporting industries in localities.

- Build local technical centers to support industrial development by upgrading existing units, or building new physical foundations or adding functions and tasks of and reorganizing, existing units with the use of local budget funds and other lawful funding sources to meet industrial development demands and suit local socio-economic development conditions.

- Pay part of costs for investment in infrastructure and environment treatment for projects manufacturing supporting industry products.

- Develop and implement preferential credit programs eligible for provision of interest rate differences, for medium- and long-term loans of enterprises, for implementing projects manufacturing products of prioritized supporting industries based on the characteristics of each locality; support the provision of interest rate differences with local budget funds as well as ODA, concessional loans and other lawful funding sources.

- Plan, invest and support investment in a number of locally managed industrial parks and clusters engaged in supporting industries, including construction of workshops for lease, financial lease-purchase for renewal of manufacturing equipment after the model of industrial clusters, manufacture of supporting industry products and important raw materials and auxiliary materials for the textile-garment and footwear industries like fiber, textile, dyeing, leather, new materials and metal materials in mechanical engineering and manufacture.

- The People’s Committees of Hanoi, Ho Chi Minh City and Da Nang shall allocate sufficient land areas (at least 3 hectares) for the Ministry of Industry and Trade to build regional technical centers to support industrial development on a scale stated in their approved establishment schemes.

12. The Vietnam Association for Supporting Industries and related trade associations shall:

- Work with state management agencies in further improving mechanisms and policies on industrial development, and support programs aiming to raise the capacity and efficiency of production and business activities.

- Encourage joint venture enterprises and wholly foreign-owned enterprises to join various associations for enhancing coordination, forming linking chains and exchanging experience between domestic and FDI enterprises in the mechanical engineering, electronics, textile-garment, and supporting industries.

- Mobilize members of associations to form production value chains.

13. Press, radio and television agencies

The Vietnam Television, Voice of Vietnam, Vietnam News Agency, and other press, radio and television agencies shall increase the production, transmission, broadcasting and distribution of assorted programs, columns and printed publications on industrial development and development of supporting industries with a broadcasting time volume making up at least 10% of the total time volume for broadcasting political news and essential information of the country and localities in order to disseminate information about policy making and enforcement as well as activities of enterprises engaged in prioritized supporting industries and processing and manufacturing industries.

V. ORGANIZATION OF IMPLEMENTATION

1. Ministers, heads of ministerial-level agencies, chairpersons of provincial-level People’s Committees, and heads of related agencies shall, within the ambit of their assigned functions and tasks, direct, guide and organize the implementation of the solutions mentioned in this Resolution so as to promptly remove difficulties and problems related to supporting industries.

2. The Ministry of Industry and Trade shall assume the prime responsibility for, and coordinate with related ministries and sectors in, monitoring, urging and inspecting the implementation of this Resolution; summarize and report to the Prime Minister on the implementation of this Resolution when so requested.-

On behalf of the Government
Prime Minister
NGUYEN XUAN PHUC