Joining global value chains unavoidable for development: workshop

Participating in global value chains is an inevitable step towards building and developing brands, as well as gaining a firm foothold on the world market, said Le Hoang Tai, deputy head of the Trade Promotion Agency, at an investment promotion workshop in Hanoi on April 11.

Tai stressed that international trade has witnessed the formation of global value chains, which attract the participation of not only developed, but also developing nations.

In developing countries like Vietnam, global value chains have helped local enterprises gradually undertake different stages of the production process and bring into full play trade advantages, thus speeding up the industrialisation process, he added.

The Vietnamese economy has maintained its development trend over the past time. According to a report by the General Statistics Office (GSO), the national GDP in 2018 rose by 7.08 percent yearonyear, the highest level since 2008, in which the industrial sector enjoyed a growth rate of 8.79 percent, accounting for 28.44 percent of the GDP. The index of industrial production last year increased by 10.2 percent, with processing and manufacturing remaining the main driver with a growth rate of 12.98 percent.

Over the past few years, both domestic and foreign investors have continued to put their confidence in the stability of Vietnam’s macroeconomy and invest in the country’s industrial sector. Some outstanding investment projects are the 35trillionVND (1.5 billion USD) Vinfast automobile production complex project, with a capacity of 500,000 units a year; and Hyosung Corporation’s 1.2billionUSD project to build a polypropylene (PP) plant and underground storage facilities for LPG.

GSO statistics show that last year, processing and manufacturing attracted the largest share of foreign investment, with newlyregistered capital totalling 9 billion USD, accounting for 50.5 percent of the total newlyregistered capital.

Big enterprises choosing Vietnam as the location of their factories offers opportunities for Vietnamese businesses to participate in global value chains. For example, the Republic of Korea’s Samsung Group recently announced its requirement of about 500 supply firms for its production facilities in Vietnam during the 20192020 period.

However, Vice President and General Secretary of the Vietnam Association for Supporting Industries Truong Thi Chi Binh pointed to the fact that many small and mediumsized Vietnamese enterprises have yet to meet orders, either in terms of price or volume.

Therefore, Binh advised businesses to choose products suitable for their capacity.

She also stressed the need for policies to prioritise domestic supply, and attract domestic and foreign investments in the production of certain products depending on different periods.

Source: Vietnam News Agency