Outlook not rosy for supporting industries

According to the report, only 35.9 per cent of the surveyed companies offered a positive outlook in the development of supporting industries in Ho Chi Minh City and the two neighbouring provinces, as well as Vietnam as a whole.

But more than 25 per cent of the surveyed companies expressed a negative outlook, and the remainder said they did not a clear outlook for such development, said Nguyen Viet Se, the chief author of the survey.

The fact that almost two-thirds of the companies gave such dreary answers showed that corporate confidence in development policies and opportunities in supporting industries was low, said Se, director of the Ho Chi Minh City Branch of the National Centre for Socio-Economic Information and Forecast under the  Ministry of Planning and Investment.

On a more positive note, 41.4 per cent of the surveyed firms said they would continue to invest in business expansion over the next three years, including 42.3 per cent of private Vietnamese owned firms and 40.6 per cent that of foreign-invested enterprises (FIEs).  The proportion of companies with no definite answer to a decision for business expansion investments over the next three is 42.3 per cent, he said. Specifically,  the rate of private Vietnamese enterprises is 38.7 per cent, of FIEs is up to 44.5 per cent. While the overall rate of companies expressing no plans to expand was 16.3 per cent, there were wide differences in sectors. The footwear section saw a 36.4 per cent rate, textile and garment 24.1 per cent, rubber, chemicals and plastics 13.8 per cent, engineering 16.5 per cent and automobile production 11.7 per cent.

The survey was conducted over 650 companies – 250 in Ho Chi Minh City, 200 in Dong Nai province, and 200 in Binh Duong. In terms of market selection, 54.5 per cent of the surveyed businesses said they gave top priorities to the Vietnamese market, and the rest chose overseas markets.