Hanoi (VNA) - Vietnam needs to adjustits development strategy for the mechanical engineering industry to ensure itdevelops sustainably.

So said business associations at a conferencepromoting Vietnam's mechanical engineering industry, held in Hanoi on May 14 bythe National Assembly's Committee for Science, Technology and Environment.

At the conference, they said the nationshould create technical infrastructure for the economic and industrialsectors to produce a number of technical products instead of joining toforeign production chains.

To develop the local mechanical engineeringindustry, they said the State should have appropriate, protectivepolicies. Vietnamese mechanical enterprises have lost much of their domesticmarket share, according to the association.

Representatives of the Vietnam Association ofMechanical Industry (VAMI) and some businesses said that since 2013,the industry has begun to see development slow, with the exception ofautomobile and motorcycle manufacturing, which has maintained a high growthrate.

Reasons for the slowdown included a widereconomic slowdown and high interest rates for loans.

Despite that, the State and the private sectorshave in recent years invested billions of US dollars in buying equipment,machinery and production tools to develop technical infrastructure and buildmany new factories.

Speaking at the conference, Chairman of the NA’sCommittee for Science, Technology and Environment Phan Xuan Dung said the Statehas given priority to developing the industry.  

Dung said the industrial production value of themechanical industry has increased year by year and many mechanical products arenow made in Vietnam.

The mechanical industry is considered a keyfactor in sustaining rapid national industrialisation, he said. To become anindustrialised country, the Government has issued policies to encourage investmentand development of the support industry and localise production of componentsand accessories at foreign direct investment (FDI) enterprises.

This is considered an inevitable directionfor small- and medium-sized enterprises in Vietnam during the integrationprocess.

The State has promoted the development ofnational research programmes for the industry and opened research anddevelopment centres to increase the number of products made in Vietnam and thelocalisation rate of some products, he said.

However, there are still many obstacles in theindustry’s development process, Dung said. The engineering and manufacturingindustry has not yet played as central a role in the national economicdevelopment as expected.

FDI enterprises are finding it difficult to coordinate witheligible domestic suppliers to reduce production costs and increase thelocalisation rates of their products.-VNA