HCM City’s Index of Industrial Production (IIP) in the first 10 months of the year increased by nearly 8 per cent compared to the same period last year, propped up by high growth of electronic equipment and machinery.

Production in electronic equipment and machinery sector grew by 17.3 per cent while the mechanical sector increased 8.35 per cent, according to the city’s Department of Industry and Trade.

The total export of electronic equipment reached US$7.94 billion, an increase of 17.6 per cent compared to the same period last year, making up 30.78 per cent of total exports in HCM City.

Manufacturers have begun to invest more in the domestic market and compete with imported goods, as opposed to focusing mostly on exporting.

In addition, more companies are investing in modern machinery to produce automobile components.

The other industries of the city such as food and beverage processing saw growth rise by 7.19 per cent and the chemical industry, by 2.82 per cent.

The four key industries are continuing to grow strongly thanks to market expansion, investment in equipment and quality improvement.

HCM City’s industrial sectors have seen good growth due to the city’s efforts in creating a better environment for investment and businesses.

It will also hold more trade promotion events and develop an Exhibition Centre for Supporting Industry Products.

Le Nguyen Duy Oanh, deputy director of the HCM City Centre for Supporting Industries Development, said the city had created programmes to help support industries, including connecting local suppliers with foreign-owned and local manufacturers and training high-skilled labour.

Last year, the city’s IIP increased by 7.9 per cent compared to 2016. Of this, the manufacturing and processing sector rose by more than 8 per cent and four major industries increased by 13.9 per cent, higher than the average rate of the industrial sector, and exceeding the target of 2017.

The four key industries in the city achieved impressive growth. Notably, the electronic and information technology sector had remarkable growth. The IIP increased 39.1 per cent compared to 2016, although there were only 260 enterprises operating in the city.

To reach the goal of 8-8.5 per cent growth in the city’s IIP in 2018, Nguyen Phuong Dong, deputy director of the department, said the department would help the People’s Committee organise meetings and tackle problems that firms are facing.

In addition, the IIP would increase gradually over the past five years (6.58 per cent in 2013, 6.99 per cent in 2014, 7.24 per cent in 2015, 7.25 per cent in 2016 and 7.9 per cent in 2017).

HCM City will call for investment in five sectors at the city’s second science and technology park, which is scheduled to open in 2019.

The sectors are information technology, renewable energy, biotechnology, semiconductor circuits and applied space technology.

The city will offer low-interest and long-term loans for enterprises investing in the sectors.

Le Hoai Quoc, head of the Sai Gon Hi-Tech Park’s Management Board, said the aim is to attract big foreign companies to the park. Local enterprises will also have more opportunities for investment in the hi-tech park.

However, local companies face more difficulties accessing capital and have less capital than foreign firms.

A representative of one enterprise said that land rent, which was much higher than surrounding provinces, was the biggest barrier for local enterprises.

Local enterprises also lack high-quality human resources because most of them are working for foreign-invested enterprises.

The 200ha second science and technology park will be built in District 9 near the Sai Gon Hi-Tech Park.

By 2020, the supporting industry for automobiles targets meeting 35 per cent of the nation’s demand for automobile components. — VNS