In recent years, Vietnam has become one of the most attractive investment destinations for many global corporations and businesses. However, the number of Vietnamese businesses participating in global supply chains remains very limited, requiring effective solutions to enhance their ability to participate in global supply chains.
This was also a topic discussed by experts at the seminar "Vietnamese Entrepreneurs' Role in Leading Key Industries" organized by the Industry and Trade Newspaper on September 24th.
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| Seminar "Vietnamese Entrepreneurs in the Role of Leading Key Industries" - Photo: Can Dung |
The story of screws and the injustice suffered by Vietnam's mechanical engineering industry.
According to official figures, Vietnam currently has approximately 5,000 supporting industry enterprises. However, only about 100 of these are domestic private enterprises that are first-tier suppliers to multinational corporations; around 700 are second- or third-tier suppliers. These figures indicate that the number of Vietnamese enterprises participating in global supply chains remains quite limited.
Mr. Vu Van Khoa, Deputy Director of the Institute of Mechanical Engineering Research, Ministry of Industry and Trade , assessed that participating in supply chains is not easy; we must meet quality standards, deadlines, and prices. While most domestic businesses are small, medium, and micro-sized enterprises, investing in machinery and equipment and applying the standards of multinational corporations is very difficult.
"That's why there's the story about domestic businesses not being able to produce screws for phones," Mr. Khoa said, citing a story that was once a "hot" topic on all forums, and behind the screw story lies a long series of problems whose origins need to be investigated.
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| Mr. Vu Van Khoa - Deputy Director of the Institute of Mechanical Engineering Research, Ministry of Industry and Trade |
According to Mr. Khoa, it's not that Vietnam can't produce screws, but the quality requirements of partners, along with the production volume of millions of products in a very short time, are impossible for any single enterprise to meet.
In fact, Vietnam's supporting industries have made significant strides. Many high-precision mechanical products, such as screws, are now manufactured by several Vietnamese companies, meeting the standards for the automotive industry and for export abroad.
Where do domestic businesses stand in the supply chain?
Realistically speaking, economist Dr. Tran Dinh Thien believes that the Vietnamese economy is currently highly open and increasingly integrated. However, domestic businesses are still unable to participate more deeply in global supply chains.
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| Economist, Dr. Tran Dinh Thien - Photo: Can Dung |
According to Mr. Thien, Vietnam's industrial level is still low; it is still primarily focused on processing and manufacturing, and has not yet made significant progress in automation and digitalization.
Furthermore, the industrial chain system is not yet clearly defined. Vietnamese industrial enterprises and entrepreneurs have not truly created industrial linkages between the domestic market and the world ; they have not truly led the industrial chains of global enterprises and corporations into Vietnam. The industrialization and modernization transformation of enterprises remains weak.
The capabilities of domestic businesses, especially in the technology sector, are a major obstacle to attracting technology corporations' supply chains to Vietnam and limit Vietnam's ability to participate in the upstream stages of global production networks.
If these weaknesses are not addressed soon, they will increase the risk of falling deeper into the trap of outsourcing and assembly, making it difficult to control low-quality investment flows, investments aimed at taking over domestic markets and businesses, and investments made under false pretenses...
Citing the example of domestic businesses' participation in Samsung's supply chain, Vu Van Khoa, Deputy Director of the Institute of Mechanical Engineering Research, stated that it remains difficult for domestic companies to directly participate in the supply chain of materials and components for this enterprise.
"The companies that provide technical services to the Samsung complex are 'backroom' companies. It's very difficult for Vietnamese businesses to participate in their supply chain, or if they do, they only participate in simple technologies, a very small part," Mr. Khoa said.
According to Mr. Khoa, in the trend of global supply chain shifts, Vietnam has become one of the manufacturing destinations for many global corporations, and deep participation in supply chains and production chains is essential for Vietnamese businesses.
Deeper integration into global supply chains in the current context depends heavily on the self-effort of the business community; however, this effort will be much easier and more favorable if institutional conditions, the business environment, and legal regulations are more conducive to the self-effort of businesses.
Furthermore, it is necessary to strengthen the connection between domestic businesses and international corporations. The government should play an intermediary role, creating favorable conditions for domestic businesses to participate in international supply chains through organizing seminars, economic forums, and capacity-building training programs.
Source: https://congthuong.vn/loi-di-nao-de-doanh-nghiep-viet-vao-chuoi-cung-ung-toan-cau-349870.html
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