Hanoi's ancillary industries have innovated and invested in smart production technologies to adapt to the major changes in supply chain dynamics to improve their competitiveness.

In Song Cung Industrial Park, Hanoi, Nam Phuong Electrical Construction Co., Ltd. has teamed up with a German partner to produce electrical cabinets and elevator control systems using INTEC technology. This cooperation has allowed the company's electrical cabinets and elevator control systems to be a customer alternative to better-known and more expensive elevator brands, meeting German standards and offering cost-effective solutions.

According to the company, the production process of elevator cabinets and control systems is strictly enforced, while the cost is only one-fourth compared to that of other brands.

"Our goal is to become a leading supplier of control systems in the domestic market and to export to markets such as Malaysia and Singapore," said the company representative.

Production at Hanoi's Thang Long Metal Wares Company. Photo: Pham Hung/ The Hanoi Times

Nam Phuong Electrical Construction Co., Ltd. is one of over 320 enterprises with production systems and products that meet international standards and are able to supply to the production networks of multinational corporations in Vietnam and around the world. According to the city's Department of Industry and Trade, two-thirds of Hanoi's enterprises in this sector have less modern production lines. They cannot meet the requirements for deep participation in the global production chain.

The city will continue to support industrial enterprises, enabling them to access capital and technology and connect in person and online with partners and customers at home and abroad.

Nguyen Dinh Thang, Deputy Director of the Hanoi Department of Industry and Trade, said that Hanoi has identified ancillary industries as vital for sustainable economic development, attracting foreign direct investment, promoting technology transfer, and developing small and medium-sized enterprises.

He emphasized that this perception is driving domestic companies to actively participate in the supply chains of foreign-invested enterprises and the global value chains of multinational corporations.

"Component and spare parts manufacturing is an important sector that supplies the automotive, motorcycle, machinery and electronics industries. The production systems and products of many enterprises in this sector meet international standards, qualifying them to be suppliers to multinationals' global networks in Vietnam," Thang said.

Tran Thi Phuong Lan, Acting Director of the Hanoi Department of Industry and Trade, said the department will work closely with associations and industries in Hanoi, especially the Japan Business Association and the Italian Chamber of Commerce in Vietnam (ICHAM), to promote Hanoi's ancillary industrial enterprises.

Hanoi's ancillary industry enterprises are expected to be suppliers at home and abroad. Photo: Hoai Nam/ The Hanoi Times

According to the latest plan, the city's target for this year is to have about 950 operating enterprises in ancillary industries, of which about 300-350 will have production systems and products that meet international standards and are capable of participating in the global production networks of multinational corporations in Vietnam.

In particular, the value of industrial production in ancillary industries accounts for about 16-17% of Hanoi's total industrial output. The development index of the ancillary industry sector is expected to increase by over 12% by 2023.

The plan emphasizes that Hanoi's ancillary industry enterprises should aim to become domestic and international suppliers, thereby attracting foreign investment into the sector.

To achieve this goal in 2023, the city has hired technical support consultants for ancillary industry enterprises in various industries, sectors, and priority product categories. The companies will receive assistance in operating management systems that meet the requirements of global production chains in business and production.

In the city's 2021-2025 plan, Hanoi expects 10% of its ancillary industry enterprises to reach Vietnam's Top 500 list.