Electronic firms should reduce their reliance on government support and push exports to promising markets in the context of the global recession and opening up of the Vietnamese market, analysts have said.

“Vietnamese electronic companies should believe in their strengths, not expect protection and understand WTO rules,” Tran Quang Hung, the general secretary of the Vietnam Electronics Association, said at at a conference held in Hanoi Thursday to assess the impact of WTO accession on the electronics and telecom sectors.

They should focus on a single area and actively seek partners in neighboring countries for production, investment and technology transfer, he said.

Delegates also stressed the importance of strengthening component manufacturing. Vietnam depends much on imports, with the heavy reliance on imported materials meaning value-addition is low.

The electronics industry should also focus on hi-tech and niche areas like medical, telecom and industrial equipment, they noted.

The Ministry of Industry and Trade said the electronics industry is lopsided, with 80 percent of its products meant for consumer use.

It said the industry should invest more to improve technology to reduce costs and strengthen quality.

Vietnamese firms spend only 0.3-0.5 percent of their turnover on research and development, compared to 5 percent in India, 10 percent in South Korea and 12 percent in China.

The government would help firms open offices and showrooms abroad to study markets and promote their products, the ministry said.

Delegates said, however, that the industry must tap the local market of 86 million people where more than half of them are aged under 30 and ready to spend on hi-tech products.

Dinh Thi My Loan, general secretary of the Vietnam Retailer Association, said electronics firms should diversify their products and improve their service to be more competitive.

Vietnam has 300 electronics firms, with 30 percent of them foreign-invested accounting for 90 percent of the total investment and revenues, and 80 percent market share, according to the Institute of Industrial Policy and Strategy Research.

Electronics exports are worth an estimated $2.75 billion this year, up 28.2 percent from 2007, the ministry said.

Source: thanhnien