Ministry proposes more aid for equipment upgrades

Companies that want to upgrade their equipment may receive financial support equal to 50% of costs under a new proposal by the Ministry of Science and Technology (MoST).

Under the proposal, companies would receive an increase in support from the original 30% as stated in Decree 119 passed in 2002, said Nguyen Trong Thu, an official of the MoST.

Decree 119, which was issued to encourage companies to update their machinery and technologies, stated that businesses would receive financial incentives if they make upgrades. Support includes bank loans at low interest rates and reduced corporate income taxes, land rentals and import taxes.

Although the decree was issued several years ago, only a few businesses have registered to receive funds since many of them have not known about the programme.

In addition, some companies have complained that application procedures were too complicated. But these companies that have received funds, have been able to upgrade equipment and technologies used in production and improve product quality for export. Ha Long Shipyard, for example, received 2 billion VND (118,800 USD) to install a 25,000 tonne keel to build large vessels weighing 6,500 to 22,500 tonnes for export.

The company has been able to double its capacity and revenue has increased to 2 trillion VND (118.8 million USD) per year.

Hanoi-based Bach Khoa Co., Ltd received 1.1 billion VND (65,340 USD) to manufacture four kinds of additives used in cement production. The additives have helped the company reduce production costs by 20% and create safer products. (VNA)