Better technologies help firms become entrenched in global value chains

Vietnamese enterprises should dig into new technologies to improve product quality and brands so as to better engage in the global value chains, Minister of Industry and Trade Tran Tuan Anh has said.

Anh, who is also Chairman of the Party Central Committee’s Economic Commission, suggested that technological development within businesses could be made through close cooperation with foreign-invested enterprises and encouraging technology transfer.

Along with the State’s support policies and mechanisms, enterprises should also invest substantially in technologies while sharpening their focus on human resources development to master state-of-the-art technologies.

It is necessary for enterprises to participate in the policy consultation process to ensure their rights while introducing policies that are beneficial to them, he stressed.

To join the global value chains, enterprises can become suppliers of multinational corporations in Vietnam or export supporting products such as automobile parts, electronic products, and materials for the garment-textile and leather footwear sectors, he said, highlighting that despite supply chain disruptions caused by COVID-19, production and business activities in the country have carried on as normal.

Customs figures show that as of December 15, Vietnam had exported US$5.3 billion worth of automobile parts last year, the same amount as in the previous year, and US$42 billion worth of computers and parts, or ten-fold higher than in 2019.

Though the garment-textile and leather footwear sectors were battered by the pandemic, they nonetheless brought in US$6.9 billion, just 1 billion less than in the same period of 2019.

COVID-19 also transformed global production, making major foreign corporations keen to shift their production to Vietnam, he said, adding that local supporting enterprises have seen better integration into the supply chains of multinational corporations.

In just two years, Japan’s Toyota Motor Corporation developed 10 tier-1 suppliers, while the Republic of Korea’s Samsung admitted 50 enterprises to its list of tier-1 suppliers and increased its number of tier-2 suppliers from 157 in 2018 to 192 in 2020.

Anh described Vietnam’s participation in various free trade agreements as a distinct advantage for the country to attract foreign capital flows.

The country’s success in its dual tasks of preventing the pandemic and promoting socio-economic development helps improve its prestige as a safe investment destination that is resilient to global shocks.

Economists have pointed to several challenges for the country, however, including weak management capacity, poor infrastructure, a shortage of skilled workers, and cumbersome procedures, among others, he added.

Add new comment

Related

Deeper integration into global value chain crucial: Minister
Deeper integration into global value chain crucial: Minister

Deeper integration into the global value chain while developing an increasingly independent and self-controlled economy are both a requirement and a solution to help Vietnam overcome the challenges to realise its goal of rapid and sustainable development, according to Party Central Committee and Minister of Industry and Trade Tran Tuan Anh.

Deeper integration into global value chain crucial: Minister

Deeper integration into global value chain crucial: Minister

Deeper integration into the global value chain while developing an increasingly independent and self-controlled economy are both a requirement and a solution to help Vietnam overcome the challenges to realise its goal of rapid and sustainable development, according to Party Central Committee and Minister of Industry and Trade Tran Tuan Anh.