|Rubber latex processing line at the factory of Chu Pah Rubber Co Ltd in central highlands province of Gia Lai. — VNA/VNS Photo Vu Sinh
Tai told the conference that international trade had seen the establishment of global value chains with active participation of not only developed countries but also developing ones and emerging economies.
“With developing countries like Vietnam, global value chains help them gradually join the production network and take advantage of trade, thus accelerating the industrialisation process. Taking part in the chains helps firms gain a foothold in the global market,” he added.
Vietnam’s economy in general and its industrial sector in particular has seen positive changes in the past few years. According to a report from the General Statistics Office (GSO), the country’s GDP in 2018 rose by 7.08 per cent from the previous year. This was the highest growth since 2008. The industrial sector maintained a growth rate of 8.79 per cent, accounting for 28 per cent of GDP.
The index of industrial production (IIP) in 2018 posted a 10.2 per cent year-on-year increase. Manufacturing and processing continued to be the main momentum for the industrial sector’s growth.
He said both local and foreign investors had put their trust on the stability of Vietnam’s marco-economy and continue their strong investment into industrial sector.
Some big projects include the Vinfast automobile manufacturing complex with total investment of VND35 trillion (US$1.5 billion) and the $1.2 billion LG Innitek Hai Phong plant.
GSO figures showed that last year, the processing and manufacturing sector attracted the highest FDI capital of $9.06 billion, accounting for half of total registered investment.
The presence of many big multinational companies in Vietnam such as Samsung and LG would create opportunities for Vietnamese firms to join the global value chain.
Samsung Vietnam needed 500 suppliers by 2020, showing the potential for local firms to join the global value chain.
However, Truong Thi Chi Binh, vice chairwoman cum general secretary of the Vietnam Association for Support Industry (VASI), said Vietnam’s electronics sector had shortcomings such as high input costs including taxes, fees and bulky production. In addition, many small-and-medium sized enterprises had been unable to serve big orders due to a lack of completed production process.
The Government should prioritise policies to call for both domestic and foreign investments into production.