Bosch secures coveted hi-tech recognition

Bosch’s high-tech Gasoline System Plant in Long Thanh, Dong Nai

The Prime Minister Nguyen Tan Dung’s in-principle recognition came after reviewing proposals from the Ministry of Planning and Investment, the Ministry of Science and Technology, the Ministry of Finance and the Ministry of Industry and Trade.

The decision means Bosch will pay just 10 per cent corporate income tax on their income for products at its operating high-technology factory in southern Dong Nai province.

“We view the high-technology qualification as an affirmation of Bosch as a global leader in innovation and technology,” said Vo Quang-Hue, managing director of Bosch Vietnam.

Bosch established its first wholly-owned subsidiary in Vietnam in 2008 for trading, as well as the planned investment in a continuously variable transmission pushbelt manufacturing plant.

In 2011, the high-technology plant opened its doors in  Long Thanh Industrial Zone in southern Dong Nai province. By the end 2012, Bosch said it had invested approximately 100 million euros in this factory.

The German firm planned to expand its investments to 230 million euros by 2015 through the construction of new production workshops and import new equipment and machinery to raise production capacity to 5.7 million units per year.

“We are heartened by the progressive direction that the Vietnamese government is taking to not only attract new foreign investments into the country, but also to incentivise existing companies to expand their operations within the company,” said Martin Hayes, president of Bosch Southeast Asia.

He believed this decision demonstrated Vietnam as a “pro-investment country” not only to other business divisions within Bosch, but to the rest of the world as well.

Since Vietnam wants to attract more investments from multinational companies, the government has granted the highest possible incentives to transnational companies such as Samsung Electronics, Nokia, Intel and now Bosch.

The Vietnamese government is now also mulling over offering more giant foreign investors alluring incentives to attract important investment projects in the country.

According to the latest draft Corporate Income Tax Law proposed by the Ministry of Finance sent to the National Assembly last month, the Vietnamese government will directly negotiate with foreign investors to offer more investment incentives for their mammoth projects which are due to have big impacts on the country’s socio-economic development.