Laws of Vietnam

THE PRIME MINISTER

Article 1.- To approve the master plan on development of Vietnam's electronics industry up to 2010, with a vision toward 2020, with the following principal contents:

I. Development viewpoints and objectives

A. Viewpoints

1. To develop the electronics industry into an important industry of the economy in the direction of satisfying export and domestic consumption demands and contributing to accelerating the process of national industrialization and modernization.

2. To encourage various economic sectors to invest in electronics industry in different scopes and forms, from assembly of finished products to manufacture of accessories, spare parts and subsidiary products, attaching special importance to attracting foreign investment from transnational conglomerates.

3. In the coming time, domestic enterprises will develop through restructuring their production towards development of specialized electronics, including the manufacture of products, accessories, spare parts and subsidiary products for informatics, telecommunications, medical electronics, industrial electronics, mechanical electronics, measurement and automation.

4. Development of human resources to meet qualitative and quantitative requirements constitutes an important factor in the development of electronics industry in Vietnam.

B. Development objectives

1. General objectives

To develop Vietnam's electronics industry in service of national industrialization and modernization as well as defense and security tasks, and to become competitive in the regional and world markets.

2. Objective by 2010

The industry will achieve a production turnover of USD 4-6 billion and an export turnover of USD 3-5 billion, create 300,000 jobs, and grow at an annual rate of between 20% and 30%.

3. Vision toward 2020

a/ Electronics industry will become a motive force for development, making great contributions to export.

b/ To create 500,000 jobs and build a contingent of engineers and technicians with international qualifications.

c/ Domestic manufacture will be capable of satisfying most of the market demand and not depend on imported products.

d/ Subsidiary industries will be developed to meet domestic manufacture and export demands.

e/ Manufacturing establishments will be located rationally according to regional development orientations.

II. Development orientations

1. Orientations on products and product structure

a/ The group of products to be developed includes: computers and peripheral devices; information-telecommunications products; products of medical electronics, industrial electronics, measurement and automation; accessories, spare parts and subsidiary products.

b/ To raise the proportion of special-use electronic products, spare parts and accessories by promoting the manufacture and assembly of special-use electronic products and hi-tech products in order to improve enterprises' technology capacity.

c/ To develop the production of electronic materials, a domain in which Vietnam has many advantages in terms of resources. To prioritize the development of some subsidiary industries such as template treatment, casting, plastic pressing, metal piercing, and surface treatment (painting, plating, etc.) in service of the manufacture of spare parts and accessories for the electronics industry.

2. Orientations on market

To diversify and raise the competitiveness of, products in order to satisfy the domestic market and approach to the regional and world markets. To concentrate efforts on studying and developing products of high added value and competitiveness in the region and world.

3. Orientation on human resources

The State encourages all economic sectors in society to participate in the development of human resources to meet development requirements of electronics industry. To develop human resources through training:

a/ Experts in designing, researching and developing new products of high added value and competitiveness so as to meet the demands of the regional and world markets;

b/ Qualified technological engineers who are capable of receiving and effectively applying advanced technologies in Vietnam, and creating new technologies;

c/ A contingent of skilled workers who are directly engaged in production activities and ensure product quality;

d/ Good middle-ranking managers who are capable of effectively managing production processes.

4. Orientations on research, designing and development of products and technologies

To research and design civil and special-use electronic products, spare parts and accessories of moderate complexity and diversified designs, so as to meet the market demand and raise product competitiveness.

To continue building and training a contingent of experts in researching, designing and developing hi-tech products of high intellectual content, making the full use of advantages in design, system integration and programming capacity to turn out products of higher added value.

To ensure close coordination among universities, research institutes and enterprises in order to make the full use of research capacity, equipment and results. To encourage the application of research results to production and business activities and support the development of new products.

To apply advanced technologies and receive technologies directly from foreign companies which have created source technologies without going through an intermediary, regarding economic benefits as the primary criterion.

5. Orientations on region-based development of electronics industry

To concentrate investment in the development of electronics industry in industrial parks and export-processing zones in key economic regions according to the Government's orientations on socio-economic development of these regions up to 2010, with a vision towards 2020.

III. Implementation solutions

1. Solutions related to mechanisms and policies

a/ To perfect the legal environment in order to improve the investment environment and protect industrial property rights in electronics industry.

b/ To perfect tax policies along the line of creating conditions for, and taking into account the benefits of, both assembly enterprises and manufacturing ones, creating a fair and equal environment for production and business.

c/ To comply with commitments in international agreements (AFTA/CEPT, WTO, etc.).

d/ To accelerate reform of administrative procedures; to raise the state management capacity in electronics industry; to publicize mechanisms and policies; and to continue perfecting legal foundations aiming at improving the investment environment.

e/ To invest in the construction of infrastructure: To ensure stable power supply and convenient information and traffic networks; to build IT parks.

2. Solutions related to investment capital

a/ To encourage all economic sectors to invest in electronics industry, paying special attention to the attraction of foreign investment capital from giant and transnational conglomerates and foreign-invested enterprises currently operating in Vietnam.

b/ To mobilize to the utmost all domestic capital sources for investment in the electronics industry.

c/ To prioritize investment capital from the state budget for infrastructure construction, human resource training, research-development (R-D) activities and trade promotion in electronics industry. To prioritize the use of ODA capital borrowed from the Government for electronics industry development projects.

3. Solutions related to key products

In each period, the Prime Minister shall approve a program on development of key products and, along with incentive mechanisms for the application of research results to production and business activities, provide for the minimum proportion of R-D expenditures for the development of new products in enterprises. Enterprises eligible for participating in developing key products are entitled to investment incentives from the state budget for R-D activities, pilot production, trade promotion programs, and supports for production and investment in IT parks. Financial supports for the development of key products are allocated from the state budget for the program on development of key information technology products approved by the Prime Minister.

4. Market solutions

a/ The domestic market:

- For special-use electronic products, spare parts and accessories: Enterprises should apply measures to raise the quality and utility of products, thereby increasing their added value.

- For civil electronic appliances: To apply measures in order to improve product quality, reduce costs and improve designs in order to increase their domestic market shares.

b/ Export markets: To create high-quality electronic products with competitive prices to meet the market demand. To enhance international cooperation, trade promotion and marketing activities carried out independently or within the framework of national trade promotion programs, and the participation in overseas fairs and exhibitions in order to get information on foreign markets and partners. The State encourages and creates conditions for enterprises to set up their branches or representative offices or trade centers in foreign countries to conduct market surveys, product and brand promotion, signing contracts and organize product outlets.

5. Technology solutions

a/ To attract foreign investors to invest and transfer technology in the domain of manufacturing hi-tech products of high intellectual content.

b/ To make investment in strategic technologies and key products on the basis of increasing budget allocations for scientific and technological research, providing credit and credit guarantee for the application of new technologies.

c/ To adopt proper mechanisms in order to commercialize scientific research results. To build a system of electronic product-testing laboratories up to international standards. To provide consultancy, guidance and support for enterprises participating in the program on building quality management systems. To guide industrial property and trademark registration.

6. Solutions related to human resources

a/ To strongly renovate training methods and teaching programs used in electronics-telecommunications and information technology departments of technical universities and colleges. To boost the training of managers, technicians and skilled workers. To selectively apply foreign programs and experiences on training human resources for electronics industry, coordinate closely with prestigious training organizations and establishments in the world and the region in order to train human resources of high quality.

b/ To encourage the application of a training model with the participation of three parties (enterprises - institutes and schools - state management agencies) to train high-quality human resources to meet the requirements of enterprises, in which training establishments will be placed under the management of enterprises, industrial parks, export-processing zones or IT parks.

c/ To properly address the relations between training, employment and treatment and between training and retraining. To adopt policies to support electronics enterprises to organize the training of human resources.

7. Solutions related to subsidiary industries

a/ To improve the capacity of essential processing industries such as piercing metal details, casting, plating and template manufacture under the framework of the national program on development of subsidiary industries.

b/ To accelerate the reform of state enterprises engaged in mechanical engineering, plastics and casting to become enterprises specialized in manufacturing products for subsidiary industries.

IV. Key projects

1. The project on building an information technology-telecommunications industry complex, carried out by the Ministry of Post and Telematics in association with electronics groups and enterprises.

2. The project on restructuring electronic products, carried out by the Vietnam's Association of Electronics Enterprises.

3. The project on building an electronics industry information center, carried out by the Ministry of Post and Telematics.

4. The project on training human resources for electronics industry, carried out by the Ministry of Education and Training in coordination with the Ministry of Labor, War Invalids and Social Affairs.

Article 2.- Responsibilities of ministries, branches and localities

1. The Ministry of Post and Telematics shall:

a/ Publicize, and organize the implementation of, the plan on development of the electronics industry; elaborate and promulgate a list of key information technology products; effectively manage state budget capital invested in projects on development of key products;

b/ Coordinate with ministries and branches in elaborating policies to facilitate the attraction of investment in the development of electronics industry; elaborate and promulgate quality standards and technical regulations applicable to electronic products; coordinate with localities, especially economic regions, in adopting mechanisms and policies to set orientations for investors to develop production in accordance with the development orientations set forth in the master plan;

c/ Act as a market link for domestic enterprises, providing information on technological trends and product designs, analyzing, forecasting and publicizing statistical data synthesized on a national, regional or sectoral basis in order to help enterprises take the initiative in producing products based on market demand and in technological research and development.

2. The Ministry of Industry shall assume the prime responsibility for, and coordinate with concerned ministries and branches in, formulating programs and policies on development of subsidiary industries commensurate with the development of electronics industry.

3. The Ministry of Planning and Investment shall assume the prime responsibility for, and coordinate with the Ministry of Finance and the Ministry of Post and Telematics in, elaborating investment promotion policies so as to improve the capacity of attracting investment in the development of the electronics industry; allocate the State's development investment capital for programs on development of electronics industry in each period.

4. The Ministry of Finance shall assume the prime responsibility for, and coordinate with concerned ministries and branches in, studying, proposing, amending, or promulgating new policies on tax and capital sources in order to facilitate enterprises' investment and production activities; study and promulgate incentive policies to encourage the development of electronics industry to meet the requirements of international economic cooperation.

5. The Ministry of Trade shall assume the prime responsibility for, and coordinate with the Ministry of Post and Telematics and concerned ministries and branches in, organizing the implementation of solutions, programs and projects in order to boost trade promotion, develop market and build brands for electronics industry. To prioritize electronics industry in the national trade promotion program.

6. The Ministry of Science and Technology shall elaborate and promulgate policies to promote R-D activities, technology import and commercialization of scientific and technological results and encourage enterprises to develop and renew technologies; and coordinate with the Ministry of Post and Telematics in promulgating technical regulations, quality standards and regulations on transfer of special technologies in electronics industry.

7. The Ministry of Education and Training shall formulate training policies and programs; coordinate with the Ministry of Post and Telematics in formulating policies on training human resources, including specialists, engineers and skilled workers, for realizing the plan on development of electronics industry.

8. The Ministry of Labor, War Invalids and Social Affairs shall elaborate policies on labor training, labor, wage, social insurance, health insurance and labor safety for laborers, and on relations between laborers and labor users in electronics industry.

9. Provincial/municipal People's Committees shall organize investment promotion activities, invest their resources in the construction and renovation of infrastructure, reform administrative procedures, associate with other regions and promote their geographical, economic and human resource advantages to attract foreign investment in industrial parks, export-processing zones, hi-tech parks and IT parks in their localities.

10. Trade associations and enterprises

Associations shall act as a link between enterprises and state management agencies. Trade associations, on the one hand, should quickly reflect enterprises' opinions and problems in administrative procedures to state management agencies, request these agencies to actively help enterprises solve these problems, and on the other hand, assist enterprises in accessing statistical indicators and information on the market and products from state management agencies.

Enterprises shall actively participate in the program on restructuring enterprises and renovate their working styles so as to match the professionalism of international economic conglomerates and multi-national companies. To attach importance to re-investment in technological R-D and the development of new products and key industrial products. Enterprises that participate in these programs are entitled to incentives prescribed by law.

Article 3.- This Decision takes effect 15 days after its publication in "CONG BAO."

Article 4.- Ministers, heads of ministerial-level agencies and government-attached agencies and presidents of provincial/municipal People's Committees shall implement this Decision.