Can the automobile industry be the main economic force in the Central region?

Truong Hai's head calls for cooperation from other businesses to create value chains in the automobile industry...

Thaco Group's KIA passenger car manufacturing and assembly plant.

“Very suitable” is the opinion of Mr. Tran Ba ​​Duong, Chairman of Truong Hai Auto Corporation (Thaco) when proposing to choose the automobile industry as the key industry for the dynamic economic region of the Central region.

At the discussion session on the morning of August 15 of the Central Economic Forum organized by the Central Economic Committee and Vietnam Economic Times in Da Nang, Thaco Chairman was the only businessman to speak.

The proposal of the successful businessman in Quang Nam originated from the development of Thaco, which currently holds more than 31% market share in the Vietnam Automobile Manufacturers Association (VAMA).

Thaco is also the first and only company in Vietnam to produce all 3 vehicle lines: trucks, buses and passenger cars with the highest localization rate: 40 - 46% for buses, 30 - 35% for trucks and 18 - 22% for passenger cars.

In the first 6 months of 2014, Thaco reached nearly 40 thousand vehicles and ranked first in the Vietnamese market, Mr. Duong informed at the forum.

Returning to the proposal to choose the automobile industry as the key industry for the Central economic region, Chairman Thaco led that this industry in Quang Nam province in particular and the Central region in general plays an important role, accounting for a large proportion in the development of the mechanical industry of the province, the region and the whole country.

This is also the industry chosen by the State as the key and spearhead industry of the country.

The automobile industry is a combination of many other important industries such as: mechanics, materials, electricity, electronics, plastics, rubber, glass, chemicals, etc. Experience from other countries shows that when this industry develops, it will lead to the development of other industries, Mr. Duong analyzed.

Mr. Duong also said that it is necessary to maintain the automobile assembly industry as a basis for developing other industries and creating links with other industries as a driving force for regional economic development.

On the other hand, to successfully build the automobile industry into a key industry for the Central economic region, the supporting industry plays an extremely important role.

With this view, Truong Hai wishes to become a multi-purpose mechanical center in the Central region.

"We have invested a lot of machinery, have clean land to build factories, businesses in the Central region only need to have the desire, we will support in management, connect with foreign countries to transfer technology", Mr. Duong called for cooperation from other businesses to create a value chain in the automobile industry.

Reiterating the call of Chairman Tran Ba ​​Duong, Chairman of the Vietnam Chamber of Commerce and Industry (VCCI) Vu Tien Loc emphasized at the beginning of the afternoon discussion session: every value chain must start from enterprises.

The Chairman of VCCI also said that the model of connecting the central coastal region still lacks a basic pillar: enterprises.

"The Central region's regional connectivity needs a three-pillar mechanism: government, scientists and businesses. The regional business council is the action team, the core of regional connectivity. The heart of regional connectivity is businesses," Mr. Vu Tien Loc emphasized.

Commenting on the fact that the nine central coastal provinces are developing below their potential, the Chairman of VCCI pointed out that one of the reasons comes from the small business community.

Many figures have been given to prove this, such as the average capital of over 42 thousand enterprises in this area is only equal to 39.1% of the average capital of the whole country. The rate of return on capital is only 0.96%, while the whole country is 2.25%.

With a small number, scattered, small scale, and very low business efficiency, according to the Chairman of VCCI, businesses in the central region need to have a resonance of interests and mutual support to develop through promoting links between large enterprises and small and medium enterprises.

According to VnEconomy