More than 100 enterprises attend dialogue on "Tax policies and role of Customs to promote Vietnam's automobile industry"

	Customs sector removing difficulties, accompanying automobile industry
	Auto business recovers thanks to the government's stimulus policy
	Localisation rate of Vietnamese automobile industry remains low

Editor-in-chief of Customs Newspaper Vu Thi Anh Hong presents sponsors with flowers. Photo: Hong Van

The dialogue was attended by Deputy Director of General Department of Customs Luu ManhTuong; representatives of the Vietnam Automobile Enterprises’ Association (VAMA); Vietnam Association for Supporting Industries (VASI); representatives of the customs departments of the provinces and cities: Hanoi, Hai Phong, QuangNinh, Ha Nam Ninh, Quang Nam and Ba Ria-Vung Tau and more than 100 guests from auto importers, manufacturers and assemblers, automobile industry enterprises under the VAMA and VASI; banks and sponsors.

Speaking at the dialogue, Deputy Director of General Department of Customs LuuManhTuong emphasized that from the beginning of the year to October 15, the country imported 73,685 cars of all kinds, valued at US$1.6 billion and imported auto accessories and components valued at US$2.86 billion.

The Customs sector is actively implementing the issued policies to accompany the automobile supporting industry to develop according.

Deputy Director of General Department of Customs LuuManhTuong delivers his speech at the dialogue. Photo: Hong Van

Speaking at the opening of the dialogue, Editor-in-chief of Customs Newspaper Vu Thi Anh Hong said Vietnam's automobile industry developed about 30 years later than other regional countries.

While countries such as Thailand, Indonesia, and Malaysia have developed automobile industriesfrom 1960, it was not until 1991 that Vietnam’s automobile industry was born. This fact creates great competitive pressure on the domestic automobile manufacture.

In the context of high prices of domestically produced cars and low localization rates, domestically produced cars find it difficult to compete with imported CBU cars and the development of Vietnam’s automobile industry is increasingly difficult.

In recent years, Vietnam has signed and will sign many bilateral and multilateral trade agreements;accordingly, import tax on CBU cars is onthe tax reduction schedule and will quickly move to 0%.

With the goal of developing the domestic automobile industry and quickly reducing the import rate of components and CNU cars, the Government has issued many policies to encourage and support the automobile industry.

Ministries and agencies have also implemented many activities and solutions to support enterprises in investment, import and export, production and trading of mechanical products in general, and auto spare parts and components in particular. Moreover, there have been efforts of enterprises to invest in technology and human resources.

The automobile industry has developed with an increase in the number of automobile-related manufacturing enterprises. Currently, there are about 350 enterprises engaged in manufacturing and assembling of auto components, spare parts, chassis and vehicle body.

Recently, many large-scale automobile manufacture and assembly projects have been established and developed, meeting domestic demand and building a Vietnamese automobile brand.

In addition to the positive results, Vietnam’s automobile industry and the implementation of policies to support Vietnam’s automobile industry are still limited. There are still proposals and problems that need to be removed, Hong said.

For the supporting industry, current supporting enterprises are mainly small and medium enterprises. Of about 1,800 manufacturers of spare parts and components, only about 300 domestic enterprises participate in the production network of multinational corporations.

Editor-in-chief Vu Thi Anh Hong speaks at the dialogue. Photo: Hong Van

The localization rate of Vietnamese cars reaches 7-10%, while this rate of regional countries is 65-70% and Thailand is 80%.The localization rate in industriesofdevelopment priority is low. The ability to self-supply of supporting industrial products for the domestic manufacture and assembly demand is very low, so Vietnam still has to import components and spare parts of machinery and equipment.

With the determination to remove difficulties for the automobile industry, following the Government's Decree 122 in 2016 and Decree 125 in 2017 on tax incentives for imported auto components, the Government promulgated Decree No. 57/2020 / ND-CP dated May 25, 2020 on incentives for raw materials, materials and components for the manufacture and processing of supporting industrial products of development priority for the automobile manufacturing and assembling industryfrom 2020 to 2024.

This is considered a powerful solution to promote the participation of small and medium enterprises of all economic sectors in the Vietnam’s automobile industry, contributing to cutting input costs for supporting industrial products to compete with imported products.

"And this is an opportunity for supporting industry enterprises to develop, and expand their production and vice versa. If they do not make good use of this opportunity, Vietnam’s automobile industry will continue to lag behind the regional countries or only stop at assembly or small-scale production," the leader of Customs Newspaper emphasized.

With the desire to disseminate and discuss new legal policies (Decree No. 57 / ND-CP)and connect as well as listen to reflections from automobile manufacturing and assembly enterprises about difficulties and problems and propose authorities to remove difficulties and facilitate the supporting industry and promote the domestic automobile manufacturing and assembling industry, Customs Newspaper and the VAMA jointly held the dialogue on: “Tax policy and the role of Customs to promote Vietnam’s automobile industry”.

"Customs newspaper expects that the State management agencies the Ministry of Finance, the General Department of Customs, the Ministry of Industry and Trade and enterprises operating in the field of automobile manufacture and assembly, automobile supporting industry enterprises and automobile importers and credit institutionswill frankly exchange opinions and share experiences to promote production, trade, development and fair competition,"said Hong.

Customs newspaper will continue to update information to readers.