Building a leading business team in the new era

From a purely agricultural country, starting from zero in the automobile sector, but now Vietnam has had an automobile brand listed on the US stock market for more than a year. The event of ringing the opening bell on the Nasdaq (US) trading session by VinFast leaders not only opened up opportunities to access the international capital market, promoting the strong development of the VinFast brand in the future, but also inspired Vietnamese brands to go global. Since then, the name VinFast has been continuously mentioned not only domestically but also regionally and globally.

After only 5 years of establishment, VinFast has continuously caused a stir with "huge" advances such as: making Vietnam one of the countries with the leading number of charging ports in the region as well as the world, surpassing both the US and China; helping Vietnam become the first country exporting transportation services in the world; pioneering the implementation of the franchise charging station model in Vietnam... Vingroup Corporation is also at the forefront of new applications that are world trends such as artificial intelligence (AI), science and technology...

VinFast electric car factory in Cat Hai district, Hai Phong city

Ba Hung

Or in the steel industry, from depending on imports, Vietnam has entered the top 15 in the world in steel production when in 2022 it ranked 13th with an output of 20 million tons. In particular, Vietnam has a manufacturing steel and high-grade steel industry. To achieve this position, we must mention Hoa Phat - the largest steel enterprise in Vietnam. In 2021, the British data firm Refinitiv Eikon (formerly Thomson Reuters Data) announced the Top 30 largest steel companies in the world, and Hoa Phat Group ranked 15th on this list with a capitalization of 11 billion USD, larger than the capitalization of Japan's leading steel group JFE Holdings. Hoa Phat is also in the Top 50 largest steel producers in the world. In Southeast Asia alone, Hoa Phat is currently the largest steel producer in the region. It is expected that from 2025, Hoa Phat's capacity will increase to 14 million tons/year and later will reach 20 million tons of steel/year when Dung Quat 3 Factory is completed as planned. At that time, Hoa Phat will be in the Top 20 largest steel producers in the world, surpassing steel producers from the US, Russia, Germany, Brazil, and many Chinese steel producers, standing on par with Hyundai of Korea. This group is even researching the production of high-quality products such as silicon steel or specialized rail steel for high-speed trains, the highest and most difficult technologies in the world steel industry...

Some other leading private enterprises in the country include Sungroup, FPT, Thaco, Masan… which are also pioneers in different fields. These corporations have contributed a lot to the development of Vietnam in recent times and also inspired the domestic business community to develop.

Although developing quite rapidly, with some leading birds, compared to the population of over 100 million people, the number of Vietnamese enterprises, especially large enterprises, is very modest. Statistics show that, in terms of scale and type of enterprises, micro-enterprises account for nearly 70%, small enterprises about 25%, medium-sized enterprises 3.5% and large enterprises 2.6%. Resolution 41 of the Politburo issued in October 2023 on building and promoting the role of Vietnamese entrepreneurs in the new period also clearly stated that most enterprises are small in scale, with limited competitiveness, operational efficiency, business capacity and management skills; the number of large-scale enterprises with the capacity to lead supply chains is still small; connectivity, cooperation and the ability to take advantage of opportunities from international economic integration and the fourth industrial revolution are still weak.

Dr. Nguyen Dinh Cung, former Director of the Central Institute for Economic Management, raised the question: How many businesses like Hoa Phat, Vingroup, Thaco... do we have? He said that if businesses are healthy, the economy will be healthy. But the important thing is to continuously develop the team, both in quantity and quality, with quantity comes quality. "We cannot naturally have 100 billionaires when the number of businesses is only a few hundred thousand. That means there must be a corresponding proportion of businesses. Thus, when there is a large number of businesses, an ecosystem will be created, at that time there will be an eagle leading in research, mastering technology... The problem is that there must be enough small and medium-sized businesses to have large businesses", said Dr. Nguyen Dinh Cung.

Production line inside Thaco's supporting industry factory at Thaco Chu Lai Industrial Park (Quang Nam)

Manh Cuong

According to the report, Vietnam has nearly 70% of small and micro enterprises, lacking units that act as a bridge between large enterprises and small and micro companies. Meanwhile, only 30% of small and micro enterprises reported profits; while 70% of small and medium enterprises reported profits. Thus, it can be said that the larger the enterprise, the higher the ability to make a profit and there is a huge difference between micro companies and the remaining enterprises in the ability to survive in the market. Our country's economy is very open, and will continue to open even in the context of the world and regional economy being forecasted to have more unpredictable fluctuations. Building an independent, self-reliant and resilient economy has become more urgent than ever. To do so, it is necessary to promote the spirit and mood of many private enterprises that are down. Our target of 1.5 million enterprises by 2025 and 2 million enterprises by 2030 is a very challenging number. When there is a large number of enterprises, an ecosystem will be created, at that time there will be an eagle leading in research and mastering technology.

Mr. Hoang Quang Phong, Vice President of the Vietnam Federation of Commerce and Industry (VCCI), cited a nationwide survey by VCCI showing that as of September this year, only 32% of enterprises said they would expand production and business in the next 2 years. This figure is slightly higher than the 27% in 2023, but is still the second lowest in 18 years of conducting annual enterprise surveys by VCCI. In addition, medium and large enterprises still said they would expand production and business. In particular, many companies in some important sectors of the economy such as manufacturing industry, agriculture, forestry, fishery, etc. also continue to have plans to expand operations. However, compared to the population size, the number of established enterprises in Vietnam is quite modest. In particular, the number of small and micro enterprises is increasingly shrinking and disappearing, making it further and further away from the set target of having at least 1 million active enterprises by 2020 and 1.5 million enterprises by 2025. Therefore, more policies are needed to support the business community.

VinFast factory in Hai Phong

Economist, Dr. Tran Dinh Thien, former Director of the Vietnam Economic Institute, assessed that the desire to grow, the ability to withstand and overcome difficulties of Vietnamese enterprises throughout history has been very resilient. However, that desire has different nuances in each period. After many difficulties, we must face the truth that the mentality of enterprises has somewhat declined due to the pandemic, devastating storms and floods, bad debts, and slow business recovery. These factors cause damage and more or less weaken, even eliminate the motivation of enterprises and entrepreneurs. According to Dr. Tran Dinh Thien, there are 3 "fatal" weaknesses of the strength of Vietnamese private enterprises: small, weak and low, despite having a history of development for several decades. For that reason, enterprises have difficulty growing and expanding to larger and larger enterprises is also extremely difficult. Therefore, to achieve the goal of making the country strong and prosperous by 2045, according to market economic logic, private enterprises must play a fundamental role with large corporations as pillars.

“What is not reassuring is that the foundation of our private enterprises is still quite weak. The role of the pillar has not been clearly defined, and production chains have not been built to participate in the global value chain led by large domestic corporations and enterprises. Limited enterprise capacity lacks connectivity to increase strength. Meanwhile, a modern global economy, if it does not participate in the production chain or is weak in that chain, it is difficult to build a strong economy,” Mr. Thien expressed his concern. From there, this expert emphasized: Vietnam's economy does not stand alone, it must compete and cooperate with the world. The team of enterprises that meet this requirement must develop strongly in both quantity and quality to compete and cooperate effectively. We really need production chains led by large domestic corporations, from which they can spread to the entire economy... Only with new chains can we change the structure of the economy, entering a new era. It is the economic corporations that help create new space for other enterprises to innovate and create. Without a chain, small and medium enterprises alone cannot develop, but will shrink and disappear.

“Vietnam recently signed an agreement with the global technology corporation NVIDIA, thereby showing the shape of a modern economy that Vietnam must follow,” Mr. Tran Dinh Thien cited and emphasized: Removing bottlenecks to create an open business environment, we have talked a lot about it for a long time, but have not been able to do it, now we must do it to talk about a new era. “In reality, we have chains but they are still very few and weak. There is no established chain in the market that has made an impression on the world. For example, Hoa Phat is making steel, which can create conditions to develop into a chain, move to mechanics, make railways, link with the Truong Hai automobile production chain, the VinFast electric vehicle chain…”, Dr. Tran Dinh Thien expressed his opinion.

According to Dr. Nguyen Si Dung, former Deputy Head of the National Assembly Office, in order for Vietnamese enterprises to truly grow and become pillars in various fields, ready to enter the new era, Vietnam needs to focus on three important prerequisites. One is to increase support for existing large enterprises. Focus resources to support the "leading cranes" to develop further, especially in high value-added fields such as technology, renewable energy, and advanced industrial production. For example, the state can consider preferential credit policies, tax reductions, or public-private partnerships (PPP) so that leading enterprises have the capacity to compete in the international market.

Next is to build a generation of "average crane" enterprises. Need to nurture   Potential enterprises by building support programs for small and medium enterprises with the potential to become large enterprises, focusing on management training, digital transformation and technological innovation; connecting small and medium enterprises with large corporations to create a sustainable development ecosystem, helping small enterprises gradually improve their competitiveness.

Manufactured at Hoa Phat Group

Another point is to improve the institutional and policy environment. It is necessary to ensure that resolutions and policies on enterprise development are effectively implemented, minimizing administrative barriers, informal costs and inconsistencies in management. A stable and transparent legal environment will create confidence for enterprises to invest long-term and focus on sustainable development.

“To make the business community truly strong, we need a comprehensive strategy to both promote the leading role of current large enterprises and build a new generation of enterprises capable of rising up. The most important thing is to create a transparent, fair business environment that encourages innovation. This will be the foundation for Vietnamese enterprises to become pillars in many fields, contributing to bringing the country into a new era,” Dr. Nguyen Si Dung emphasized.

Thanhnien.vn

Source: https://thanhnien.vn/xay-dung-doi-ngu-doanh-nghiep-dan-dat-trong-ky-nguyen-moi-185241207201039869.htm