Action plan for shipbuilding industry development

Kế hoạch hành động phát triển ngành công nghiệp đóng tàu
Vietnam’s shipbuilding industry has been heavily invested since 2002, and is in the process of taking over from major shipping hubs in Asia.

On October 22, 2014, the Prime Minister signed  Decision No. 1901 / QD-TTg  of the Shipbuilding Industry Development Action Plan to implement Vietnam’s Industrialization Strategy within the framework of Vietnam- Japan orientation to 2020, vision 2030 according to Decision No. 1043 / QD-TTg dated 1 July 2013 of the Prime Minister (Plan).

Vietnam’s shipbuilding industry has been heavily invested since 2002, and is in the process of taking over from major shipping hubs in Asia. Apart from Vinashin, which was established in 2006 (now the Shipbuilding Industry Corporation (SBIC)), Vietnam Shipbuilding Industry also plays a pivotal role in the shipbuilding industry. Vietnam (2) Vietnam National Oil and Gas Group and a number of other state corporations and corporations, (3) shipyards under management of the Ministry of Foreign Affairs, (4) local businesses and private, and (5) foreign invested enterprises.

Vietnam has 120 shipbuilding and repairing workshops with a tonnage of over 1,000 DWT, with 170 launching and lifting works. The total designed capacity of the plants is about 2.6 million DWT / year, but the actual capacity is 800,000 – 1,000,000 DWT / year (31-39% of designed capacity), of which 50% Domestic demand (300,000 – 400,000 DWT per year); Exporting 500,000 – 600,000 DWT / year, accounting for 0.3 – 0.4% of world shipbuilding market share.

As of 2010, the sector has nearly 100,000 employees, of which Vinashin has about 43,797 employees (up to 7/2013 with about 26,000 employees), but the laborers with international certificates are very few compared to the requirements. .

The shipbuilding industry still has its shortcomings such as:

i)  lack of a strategic vision and concrete action plan towards the development of the shipbuilding industry in line with the cyclical developments of the world shipbuilding industry.

ii) low efficiency of shipbuilding infrastructure; The investment is spread out, equipment is not synchronized. The efficiency of IT management and application for system management (design-production-finance) is low.

iii) weak research and development capacity (R & D); R & D spending in the maritime industry and shipbuilding industry is negligible; skills and human resources have not been strengthened to meet the development requirements of the industry.

iv) many factories have not completed investment, patchwork through many stages, few factories meet international standards. Lack of organic linkages between other economic sectors such as transport, oil and gas, tourism and fisheries with shipbuilding.

v) supporting industries in the country develop spontaneously, lack of synchronism, depend too much on materials and equipment manufacturers in China and other countries.

vi) domestic shipping companies have difficulty in finding funding to expand their fleet.

The goal  of the Plan is to make shipbuilding a key industry in the implementation of the Marine Economics Strategy; Focus on producing some products suitable to the development conditions of Vietnam; Establishing trust in the world market for Vietnam is a country with a high quality shipbuilding industry.

Some quantitative targets up to 2020:

– The growth rate of output value of the whole industry: 5-10%.

– To devote 70-80% of production capacity to serve the demands of shipbuilding of various kinds in the country, serving for economic, social, defense and security development, except for a number of ships such as submarines, yachts, battleships, high tech and technical requirements.

– 3-10% for export; The number of export vessels is expected to be 1.67-2.16 million tons per year.

Specific tasks :

1. Three shipbuilding clusters are formed in the North, Central and South.

To build three low-to-middle ship repair centers concentrated in geographically advantageous locations close to major seaports and / or international maritime routes.

3. Improve the localization rate by ensuring the linkage between the shipbuilding industry and supporting industries in the country and encourage the attraction of foreign investment into supporting industries for shipbuilding, First of all, priority should be given to the number of ships having domestic and foreign consumption markets and having competitive advantages.

4. Develop institutional arrangements, legal documents for the sector, develop product types, scale products, improve R & D capacity.

Strategic Issues  of the Plan:

1. Restructure (rearrangement, reorganization …) of the existing shipyards in the country in the direction of using concentrated infrastructure and existing human resources.

2. Development of supporting industries for the shipbuilding industry (specialized machinery, equipment, small diesel engines, small generators, screwshafts, steel plates, sections, etc.) and security Ensure the supply-cooperation relationship between these sectors.

By 2020: Focusing on all kinds of marine engine parts, equipment, deck fittings, specialized electric and mechanical pipes; To step by step form the hull steel industry for low to medium ships.

3. Development of domestic market and export of ships and ship repair services; Priority is given to a number of cruise ships that have a market share and a competitive edge. To carry out the common tasks in the strategy of developing Vietnam’s aquatic products up to 2020: “To consolidate and develop the fishing ship mechanics industry with an appropriate roadmap for quickly transferring ship- new material…”

4. Training high-qualified and professional human resources at all levels from management, engineers to workers, especially the shipbuilding engineers and shipbuilding management.

Capacity building for R & D, serving three clusters in the North, Central and South.

6. Monitoring mechanism.

Action plans to achieve the goals include:

1. Restructuring existing shipyards in the direction of using existing infrastructure and human resources:  Establishing three shipbuilding linkages and building a small number of enterprises The core of the industry, joint venture shipbuilding with foreign.

2. Development of supporting industries for shipbuilding:

To review all preferential tax rates on import of raw materials, components and proposed import tax / list of raw materials and components eligible for preferences. Review of tax incentives: (1) corporate income tax; (2) preferential tariffs for the production of high-tech products, for the production of intermediate products for shipbuilding. Develop and publicize the procedures and standards that apply to businesses. Simplification and minimization of administrative procedures; modernization of administrative procedures and customs; Procedures and appraisal process for preferential treatment. Formation of the Shipbuilding Development Assistance Fund for the period 2015-2020 …

3. Development of the market for ship-consuming and ship repair services in the country and for export:  To study and promulgate mechanisms and policies to raise the competitiveness of domestic shipbuilding enterprises for various grades which Vietnam has the condition to develop and strengthen linkages between economic sectors with industry and shipbuilding. Simplification of sales procedures in the domestic market of exporters to develop supporting enterprises and increase the localization rate for shipbuilding enterprises.

4. Training high-qualified, professional and world-class human resources for all levels:  Providing vocational training funding, allocating foreign training targets for supporting industries, focusing on Developed countries;

Developing standards for testing and assessing skills in support industries for the shipbuilding industry.

5. R & D capacity building, serving three industrial clusters in the North, Central and South:  Building 01 R & D center in the North to serve three clusters with the participation of the State and of the business.

In the course of implementation of the Plan, if any difficulties arise, agencies, organizations and enterprises shall reply to the Ministry of Communications and Transport and the Industrialization Strategy Strategy Team for consideration and settlement.

The Ministry of Transport and Communications shall coordinate with the Strategy Team for Industrialization and relevant ministries and sectors to synthesize and evaluate the implementation results up to 2016 as well as relevant experiences of the Japanese side. will revise the Action Plan to be implemented from 2017.

This decision takes effect from the date of signing (Nguyen Lan).