Telecoms groups gear up for battle

August 14, 2020 | 10:00
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Though international technology giants like Lenovo, Keysight Technologies, and Amazon Web Services are expected to gain the advantages to move forward in the lucrative Vietnamese market, driven by future cuts of business conditions and new incentives, the path remains tough for them amid fierce competition from EU rivals.
1504p13 telecoms groups gear up for battle
Telecoms groups gear up for battle (photo source: internet )

The Ministry of Information and Communications (MIC) in late July issued Decision 1254/QD-BTTTT on establishing a working group to cut administrative procedures and business conditions to further facilitate business and investment activities in the field. As part of the work, there will be dialogues and a meeting with organisations and businesses to listen to their problems, and assessments of performance of business obligation among companies, as well as possible issuance of new regulations.

“The plan to cut administrative procedures will be submitted to the leader of MIC before submitting to the prime minister for approval,” the decision stated.

The new decision is issued in line with the Resolution 68/NQ-CP dated May 12 on the action programme to cut procedures and business conditions in the 2020-2025 period in the context the country is accelerating digital transformation in sectors with the recent approval of the National Digital Transformation Programme by 2025, with a vision towards 2030.

In recent years, a number of business conditions have been cut. In Decree 27/2018/ND-CP issued in 2018 amending and supplementing some regulations in 2013’s Decree 72/2013/ND-CP on management, supply and use of internet services and information, 11 business registration conditions and 13 administrative procedures were cut. Moreover, technology giants will benefit from Vietnam’s new investment rules when the new Law on Investment 2020 takes effect from next January, which gives incentives and supporting policies for innovation-related sectors such as IT, research and development, digital content, high technology, and more.

Also importantly, the Ministry of Planning and Investment has submitted to the government for approval the special incentives for the National Innovation Centre to encourage business and investment activities in the field.

With the new cuts and rules, groups like Qualcomm, Lenovo, Keysight Technologies, and Amazon Web Services (AWS) are expected to gain the advantages to boost their footprint in the Southeast Asian country. However, the path is not rosy for all as they are forecast to face stiffening competition from potential EU rivals empowered by the EU-Vietnam Free Trade Agreement (EVFTA) which has just taken effect.

DEK Technologies, Ekino, Ozitem Group, Robert Bosch Engineering Vietnam, Sunbytes, Archetype Group, and Avistel are among the members of the European Chamber of Commerce in Vietnam’s Digital Sector Committee, which are planning to expand in Vietnam.

Under the EVFTA’s commitment, Vietnam permits the establishment of 100-per-cent foreign-invested enterprises in the non-network infrastructure value-added telecommunications services after five years of the agreement’s entry into force, while in the World Trade Organization (WTO), just joint ventures are permitted with the foreign ownership limit (FOL) of 65 per cent.

In the value-added telecommunications services with network infrastructure, the FOL will be 65 per cent, being effective from five years after the EVFTA enforcement from the current 50 per cent. The threshold is 50 per cent under the WTO commitments.

In regard to basic telecommunications services, the FOL will be raised to 75 per cent for the services without network infrastructure after five years of performance of the EVFTA, in comparison with 70 per cent in the WTO. For services with network infrastructure, the country allows the establishment of joint ventures with telecom service providers licensed in Vietnam, with the FOL being 49 per cent at maximum by then which is similar to WTO commitments. In the wake of growth potential and fierce competition, Qualcomm, Lenovo, Keysight Technologies, and AWS have been working with each other to reach their own ambitions.

On August 5, Keysight Technologies, Inc., a leading technology company that helps enterprises, service providers, and governments accelerate innovation to connect and secure the world, announced it has joined the Ericsson Industry 4.0 partner programme, delivering value with test and measurement solutions for the planning, deployment, and operations of industrial 5G networks.

Keysight Technologies also earlier announced that Qualcomm Technologies, Inc. is working with the company to accelerate small cell deployment supported by 5G virtual radio access network architecture. Meanwhile, Qualcomm and ZTE Corporation achieved a 5G-enabled Voice over New Radio call last month, marking an industry-leading step in 5G.

By Tung Anh

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