HCM CITY – As HCM City’s four key industries continue to lag behind expectations, the city has decided to launch an investment encouragement programme to help enterprises upgrade machinery and expand production.

“Sixteen projects have received confirmation of their preferential interest rates for loans and four others are awaiting approval,” said Trần Anh Hào head of the Industry Commission for the municipal Department of Industry and Trade.

The department announced the initiative at a meeting on Wednesday of the city’s People’s Council’s Economy and Budget Committee.

The city’s four key industries include engineering and automation; electronics and IT; chemicals, rubber, plastics; and food processing.

In the first six months of the year, the city’s four key industries helped spur industrial growth, which reached growth of 10.23 per cent compared with an increase of 7.5 per cent in the industrial development index.

From 2006 to 2010, the four key industries gained an annual growth of 14 per cent, and from 2011 to 2015, an annual growth of 8.8 per cent, higher than the average growth of other industries.

“These four key industries have taken a great proportion of the city’s economy, but productivity and products haven’t met the potential,” Cao Thanh Bình, deputy head of the city’s People’s Council’s Economy – Budget Committee was quoted as saying in Người Lao Động (Labourers) newspaper.

For the last four years, the percentage of newly established enterprises in the four key industries has remained low.

“The city has considered action plans for these four key industries, but investment has been insufficient, and authorities haven’t worked well to solve difficulties for enterprises,” he said.

“There have been problems in capital, land and social infrastructure, and solutions have progressed very slowly, which has affected enterprises’ investment decisions and ability to do business,” he added.

Industries, authorities and the HCM City Export Processing and Industrial Zone Authority (HEPZA) have all agreed that the city should resolve land problems in order to attract more investment.

“Land rental prices in HCM City’s export processing and industrial zones are higher than other neighbouring regions, and investors are moving out,” one official said. -- VNS