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(VEN) – In a competitive market economy, scientific and technological development has always been considered a golden solution for creating high-quality products that can dominate the market.
However, many domestic businesses have not yet become fully aware of the important role of science and technology development and have adopted a wait and see attitude.
Investment incommensurateIn fact, companies that recognize the importance of science and technology development and make adequate investment in this sector, they will have quality products beyond the national level, which is a factor to ensure their success in business and sustainable development.
For example, the Viettel Group and Vietnam National Oil and Gas Group have in recent years spent hundreds of US$ millions in scientific and technological researches and development and have brought a series of valuable products out to the market, contributing greatly to the national economic development.
However, there are few such enterprises in Vietnam now, and most Vietnamese enterprises are not interested in the application of scientific and technological advancements to production.
In Vietnam, the total national investment budget for science and technology development is estimated at two percent, equivalent to about US$700 million. “These two percent disbursement from the state budgets is also equivalent to about 0.5-0.6 of the national GDP, which somehow proves the adequate interest of the state in science and technology development as developed countries across the world are often spend from 0.3-0.4 of their national GDP on such development,” Minister of Science and Technology Nguyen Quan said.
The difference here lies in the social investment in science and technology. In Vietnam, almost all economic components do not really interest in science and technology development, resulting in the total social investment in science and technology equivalent to only one percent of the national GDP. Meanwhile, these percentages are often from 2.3-2.4 percent of national GDP in developed countries. Particularly, the Republic of Korea usually spends 4.5 percent of the national GDP on science and technology development.
Apart from those who do not interest in science and technology development, some businesses have properly recognized the role of science and technology in the development of enterprises but cannot afford to make adequate investment due to financial difficulties. By a rough reckoning, there are more than 300,000 businesses operating in the country currently.
According to Director of Hanoi University of Science and Technology’s Advanced Science and Technology Institute Pham Thanh Huy, there are two obstacles to business’ less attention to science and technology development including the awareness of business leaders and their financial capabilities. Business leaders should be fully aware of the benefit from science and technology development and have plans for training staff, setting up adequate labs and larger research and development centers for science and technology, and applying scientific and technological advancements to production. However, many domestic businesses have not enough financial resources to do this.
According to Director of Vietnam National University’s Integrated Circuit Design Research and Education Center Ngo Duc Hoang, the majority of Vietnamese businesses are young and less experienced in science and technology development than foreign counterparts, not to mention their limited financial capabilities. They can now only focus on how to survive in the market in a fierce competitiveness with their little finance. So, science and technology investment decisions would seem inadequate for them at this time.
Domestic businesses’ indifference to science and technology development, combined with their difficulties in scientific and technological application to production, has hindered private investment in science and technology development.
Domestic businesses can not stay away from science and technology development
“Science and technology development does not only concern with the state sector but the private sector as well. That is the responsibility of the whole society including organizations and individuals. This fact has been seen in both developed countries and developing countries, and particularly in emerging economies,” Minister of Science and Technology Nguyen Quan said.
It’s time Vietnamese businesses should take a hand in science and technology development.
The Communist Party’s Central Committee issued Resolution 20 at the 6th Central Meeting that for the first time defined the state-owned enterprises are required to spend a percentage of profit before tax to establish a fund to develop their science and technology development budgets, and private-owned enterprises of all economic sectors are encouraged to do so. If this is implemented, investment sources for science and technology development will be abundant and sufficient for future needs of domestic science and technology development.
To spend a percentage of profit before tax is not a matter with a large corporation, but it may matter with a small or medium enterprises. Meanwhile, the majority of domestic businesses are small and medium enterprises; therefore, it is necessary to have policy to encourage them to participate in the country’s science and technology development.
To attract investment resources for science and technology, the Daft Law on Science and Technology revised regulations and mechanism to mobilize investments from private sectors, especially for research, development and application of science and technology. Participating businesses will receive incentives such as free registration fee when registering land use, facility ownership, and infrastructure use. In addition, they will be entitled to exemption or reduction of corporate income tax when investing in high-tech parks, use of equipment in operations related to scientific research and technological development in the lab national key labs, business incubators, and state science and technology research institutions.
The Draft Law on Science and Technology was open for discussion in terms of modification at the Session 5 of the National Assembly XIII, which shows the state’s and the party’s proper appreciation of the major role of domestic business circle in the course of science and technology development. If the Draft Law on Science and Technology passed with adequate amendments this time, it will definitely further boost science and technology researches and development in the country./.
Phuong Hoan & Anh Tuyet