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The finding was presented by an official from the Ministry of Planning and Investment at a conference in Hanoi on Tuesday, reports Tuoi Tre.
The official Bui Thu Thuy, deputy head of the ministry’s Agency for Enterprises Development (AED), said that technology used by Vietnam’s small firms, which account for over 95 percent of the country’s enterprises, use equipment and technology that are two to three generations behind their global peers, citing statistics from the Business Indexing 2014 report.
“Seventy-five percent of the machines and technology production lines of these firms were made in the 1960s-1970s,” Thuy said, adding that “50 percent of them are refurbished.”
Thuy pointed to the difficulty that these business face in securing bank loans which in turn only invest .2 to .3 percent of their revenue for technology enhancements compared to 5 percent and 10 percent for India and South Korea, respectively.
Further compounding the issue is a lack of hi-tech industry (accounting for only 20 percent nationally) compared to its neighbors. Singapore, Malaysia and Thailand come in at 73 percent, 51 percent and 31 percent, respectively, according to the AED.
“Such numbers rank Vietnam 102nd out of 148 global economies, and ninth out of ten ASEAN countries,” Thuy told the conference.
[Tuoi Tre // photo via Ika Ink on Flickr]
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