With the trend of diversifying the global supply chain, many multinational corporations have been increasing their investment in Vietnam, creating great opportunities for domestic enterprises to participate. Meanwhile, the Government has also issued many policies and mechanisms with the goal of turning Vietnam into a major manufacturing center, providing a variety of products, increasingly high quality and competitive prices. However, according to assessments, many Vietnamese enterprises have not really grasped and taken advantage of the opportunities, and are still groping to find their way to join the global supply chain.
It is time for Vietnamese enterprises to quickly adapt to the new context, improve competitiveness, human resources, as well as improve labor productivity and technology, to meet the strict requirements of the supply chain in the world market.
Need to change thinking and perception
Since the end of 2023, many large economic and technology corporations in the world have been interested in and gradually shifted their supply chains to Vietnam, while promoting the search for local suppliers to increase the localization rate. In the first six months of the year alone, the total registered foreign direct investment (FDI) in Vietnam reached nearly 15.2 billion USD, up 13.1%; realized capital also reached about 10.84 billion USD, up 8.2% over the same period,...
The above results show that Vietnam is an attractive investment destination, trusted and chosen by countries and corporations, becoming a new address in the strategy of diversifying production chains and supply chains, affirming that the investment and business environment has many improvements.
In addition, increasingly synchronized infrastructure and technology are also advantages, attracting foreign investors to Vietnam. Some large corporations in the world such as Apple or Amazon, although not investing directly in Vietnam, always consider this area as a place to order components, raw materials, and input equipment for the production process. This is also an important factor for Vietnam to rise and participate more deeply in the global supply and value chain.
However, great opportunities often come with many challenges as the supply chain in Vietnam has not yet met the expectations of foreign investors. According to the General Statistics Office, Vietnam has about 5,000 supporting industry enterprises, producing industrial products to supply domestic demand and export to major markets such as South Korea, Japan, China, and the US.
However, only about 100 of these enterprises are tier-one suppliers for multinational corporations, and about 700 enterprises are tier-two, tier-three suppliers, etc. This shows that after nearly 40 years of development, Vietnamese enterprises are still struggling to find a foothold in the supply chain, with the rate of enterprises actually becoming part of the global supply chain still very low.
Director of the Center for Economic Information, Analysis and Forecast (Central Economic Committee), Dr. Nguyen Tu Anh said that out of more than 800 thousand enterprises in operation in Vietnam, 96%-98% are small and medium enterprises. These enterprises often lack management skills, have little technological innovation, have limited financial resources, the quality of human resources and labor skills are not really good and find it difficult to meet the needs of receiving and transferring science and technology of corporations when moving to Vietnam.
If these weaknesses are not promptly overcome, they will increase the risk of falling deeper into the processing and assembly trap, making it difficult to control low-quality investment flows, foreign investment taking over domestic markets and enterprises, "disguised" investment, etc. In addition, when the economy grows rapidly, attracting abundant capital flows, leading to a huge demand for energy sources, but for Vietnam, this is still an issue that makes foreign investors hesitant.
According to Nguyen Van Hoi, Director of the Institute for Strategy and Policy Research in Industry and Trade (Ministry of Industry and Trade), this process is facing many difficulties because the thinking, awareness, way of thinking, and vision of policy makers sometimes lack transparency and equality, lack stability, and policies are overlapping and contradictory. Some businesses have boldly invested in equipment, machinery, and high-quality human resources, but the level of investment is still too little compared to the actual needs of the value chain.
Besides, Vietnamese enterprises still have an inherent weakness which is the lack of connection between enterprises when participating in the supply chain, so they cannot expand the supply of raw materials and accessories locally, most of them have to find their own strategies in the market.
Focused, targeted support
Participating in regional and global supply chains is no longer a trend but has become a practical need for Vietnamese enterprises in the process of increasingly deep international economic integration. According to many experts, to anticipate that trend, Vietnam needs to have timely, synchronous and appropriate policies and solutions to prevent and limit risks, as well as take advantage of the opportunities of the shift trend, helping Vietnam gain an advantage in participating in the global supply chain right at home, especially when the world economy is showing signs of recovery.
At the same time, businesses need to proactively enhance the spirit of self-reliance, self-improvement, pioneering, innovation, daring to think, daring to do, daring to venture into new fields that the economy really needs to reach out to the international market and compete directly with foreign businesses according to market principles.
Another important issue is to improve competitiveness through focusing on developing human resources and science and technology, innovation associated with practical needs; aiming to produce high-tech products with high intellectual content, creating valuable products, standing at a high position in the global supply chain... And "greening" in production is the key for Vietnamese enterprises to improve competitiveness, meet the requirements set by the supply chain leaders on reducing carbon emissions into the environment, promoting the export of sustainable goods, creating new competitive advantages for enterprises.
The efforts of enterprises are the main factor, but according to Dr. Le Duy Binh, CEO of Economica Vietnam, the support of the Government is very important and decisive. In the coming time, the Government needs to perfect institutions and policies with administrative procedures, import and export, and specialized inspections need to be reformed and improved more strongly, at the same time, it is necessary to innovate in the approach to supporting enterprises in a more focused and important direction to achieve specific goals.
Support measures of exemption and reduction that have been implemented for too long should be gradually reduced in scale or intensity, and replaced by measures that create opportunities for businesses to develop on their own. Policies need to focus on helping businesses innovate technology, especially green technology, save and convert to renewable energy; develop digital economy, green economy, circular economy and new industries in the future such as: semiconductors, electronic chips, clean energy, digital economy, artificial intelligence, etc.
Vice President of the Vietnam Federation of Commerce and Industry (VCCI) Hoang Quang Phong hopes that in the coming time, the Government will continue to have solutions focusing on removing technical barriers for businesses to penetrate new markets; promote the development of logistics services, contribute to reducing costs, and improve the competitiveness of Vietnam's export goods, etc.
In addition, in the long term, the State needs to continue to promote growth model innovation and economic restructuring, develop strong Vietnamese enterprises with the capacity to link with technology corporations in global supply chains; develop and implement the National Strategy for regional and global supply chain integration; have policies and solutions for supporting industry development to help domestic enterprises have the capacity to participate in domestic, regional and global supply chains; promote cross-border e-commerce development to promote the development of supply chains, goods circulation, market expansion and export promotion. Only strong enough policies can help Vietnamese enterprises seize opportunities to participate in global supply and value chains, enhance independence and autonomy and affirm the position of the Vietnamese economy in the international arena.
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