Decision No. 175/2002/QĐ-TTg Approving the Strategy for the Development of the Automotive Industry in Vietnam until 2010, with a Vision to 2020

DECISION OF THE PRIME MINISTER

Approving the Strategy for the Development of the

Automotive Industry in Vietnam until 2010, with a vision to 2020

PRIME MINISTER

Pursuant to the Law on Organization dated December 25, 2001;

At the proposal of the Ministry Industry in the Report submitted under Document No. 3608/TTr-KHĐT dated September 19, 2002, and the opinions of relevant agencies at the meeting held on September 19, 2002, at the Government Office;

DECISION:

Clause 4 of Article 6Approving the Strategy for the Development of the Automotive Industry in Vietnam until 2010, with a vision to 2020, with the main contents as follows:

I. OBJECTIVES

1. General objectives

Developing the automotive industry in Vietnam based on adopting and applying advanced technology from around the world, combined with utilizing and gradually improving existing technology and equipment, to meet the majority of domestic automobile market demand, aiming towards exporting automobiles and parts.

2. Specific objectives

- Regarding ordinary vehicles: meeting 40-50% of domestic demand in terms of quantity and achieving a localization rate of 40% by 2005; meeting over 80% of domestic demand in terms of quantity and achieving a localization rate of 60% by 2010 (specifically, striving to achieve a localization rate of 50% for engines and 90% for transmissions);

- Regarding specialized vehicles: meeting 30% of domestic demand in terms of quantity and achieving a localization rate of 40% by 2005, progressing towards meeting 60% of domestic demand in terms of quantity and achieving a localization rate of 60% by 2010;

- Regarding high-end vehicles: joint ventures producing various types of passenger cars must achieve a localization rate of 20-25% by 2005 and 40-45% by 2010, while meeting 80% of domestic demand for high-end trucks and buses with a localization rate of 20% by 2005 and 35-40% by 2010.

II. STRATEGIC DIRECTION AND SOLUTIONS TO DEVELOP THE AUTOMOTIVE INDUSTRY IN VIETNAM

1. On products

a) Producing various types of common automobiles (small trucks, passenger cars, small passenger vans, buses, etc.) and specialized vehicles (fuel tankers, fire engines, small ambulances, refrigerated trucks, cement mixers, road cleaning water trucks, etc.) that are competitively priced and suitable for specific conditions in Vietnam.

b) Producing high-end vehicles to reasonably meet domestic demand and for export.

c) Concentrating on producing automobile engines to achieve appropriate localization rates as stipulated in Point 2, Section I of this Decision.

2. On production organization

Organizing automobile and automobile parts production on an industrial scale according to specialization and cooperation.

Encouraging all economic sectors to develop automobile parts production, especially components for engines.

3. Some mechanisms and policies to implement the strategy

a) Incorporating the Engine Production Program into the Priority Industrial Product Program from now until 2010.

b) Investment projects for producing common and specialized automobiles in accordance with the approved development plan shall enjoy certain incentives regarding land, credit loans, technology transfer support, scientific research support, and investment outside the fence, etc. Specific incentives will be considered and decided for each project during the approval process.

Article 2. Implementation Organization:

1. The Ministry of Industry shall take the lead and coordinate with relevant ministries, sectors, and localities to implement this Strategy; to develop the planning for the development of the automotive industry in Vietnam until 2010, and submit it to the Prime Minister for approval. All automobile production and assembly investment projects must comply with the planning, which has been reviewed by the Ministry of Industry and submitted to the Prime Minister for approval.

2. The Ministry of Finance shall study and propose tax policies to encourage the production of common and specialized automobiles as stipulated in Clause b, Point 3, Section II of this Decision.

3. The Ministry of Science and Technology shall take the lead and coordinate with the Ministry of Transport to complete and promulgate the technical standards and quality system for automobiles and parts.

Article 3. THIS DECISION SHALL TAKE EFFECT 15 DAYS AFTER THE DATE OF SIGNATURE.

Article 4. Ministers, Heads of ministerial-level agencies, Heads of government-affiliated agencies, Chairpersons of People's Committees of provinces and centrally governed cities are responsible for implementing this Decision./.