Vietnam still primarily relies on processing and manufacturing with limited automation integration

VCN - Vietnam needs to cultivate domestic enterprises that are large-scale, possess international competitiveness, boast established brands, and can serve as cornerstones in leading the industrialization and modernization process.
Vietnam currently faces numerous opportunities for developing the semiconductor industry. Photo: Collaborator
Vietnam currently faces numerous opportunities for developing the semiconductor industry. Photo: Collaborator

The need to develop "flagship" enterprises

During the seminar "Vietnamese entrepreneurs and their role in spearheading key industries," organized by the Ministry of Industry and Trade's newspaper "Cong Thuong" (Trade and Industry) on September 24th, Mr. Pham Tuan Anh, Deputy Director of the Department of Industry (Ministry of Industry and Trade), assessed that Vietnam has witnessed the emergence of some "flagship" enterprises capable of driving the economy, such as Vingroup, THACO, and Hoa Phat. However, their numbers remain inadequate to meet the demands of economic development. Currently, the development of Vietnam's industrial sector still heavily relies on external factors.

Mr. Vu Van Khoa, Deputy Director of the Institute of Mechanical Engineering Research, argued that while some robust corporations exist in sectors like automobile and motorbike manufacturing and hydropower, in many other areas, Vietnam lacks enterprises strong enough to spearhead the manufacturing industry. Currently, businesses primarily focus on basic technology adoption and lack the capacity for industrial autonomy, with technology remaining heavily reliant on foreign companies.

Mr. Khoa cited examples, particularly in energy projects and the development of railway and highway infrastructure, where Vietnam heavily depends on FDI enterprises. Consequently, the value added generated is minimal, and the level of technology transfer is not substantial.

According to economic expert Dr. Tran Dinh Thien, Vietnam's production remains fundamentally based on processing and manufacturing, with limited integration of automation and digitalization. There exists a disparity in the industrial structure, with foreign-invested enterprises accounting for a high proportion, contributing 22-23% of GDP, while domestic enterprises contribute only 10%.

Moreover, the industrial value chain system lacks clarity. Industrial enterprises and Vietnamese entrepreneurs have not yet effectively established robust industrial linkages between domestic and international markets; they have not fully succeeded in attracting industrial value chains from global corporations and enterprises into Vietnam. Furthermore, the industrialization and modernization transformation of enterprises remains relatively weak.

Regarding the development of the industrial sector, particularly in key industries, to reduce dependence and participate in global supply chains, experts suggest focusing on developing "flagship" enterprises aligned with sector-specific development strategies. This involves identifying key sectors with a strong presence of enterprises, such as foundational industries, priority industries, spearhead industries, and high-tech industries.

Encouraging innovative start-ups

According to economic expert Dr. Tran Dinh Thien, Vietnamese enterprises still lack well-defined strategies for building businesses that are closely aligned with practical realities. The focus has primarily been on quantitative growth rather than developing robust enterprise strategies.

Mr. Tran Dinh Thien cited the example of Japan's multi-tiered enterprise model, encompassing large corporations, mega-corporations, medium-sized enterprises, small enterprises, and micro-enterprises. Based on this model, it becomes easier to categorize and define development strategies tailored to each tier of enterprises.

According to Mr. Tran Dinh Thien, encouraging innovative start-ups is akin to "injecting vitality" into the business community and the economy. This approach can potentially foster the emergence of new business leaders and create new "flagship" enterprises that drive economic growth.

From an enterprise perspective, Mr. Hoang Manh Tan, Deputy General Director of Son Ha International Joint Stock Company and Vice Chairman of the Board of Directors and Director of Son Ha Energy Development Joint Stock Company (SHE), argued that within a business environment characterized by various challenges, several factors are crucial for developing a thriving Vietnamese industrial sector and establishing strong pillars.

Firstly, it is essential to strengthen trust in Vietnamese enterprises and avoid excessive reliance on foreign companies. Furthermore, the development of enterprises into industry pillars requires a significant time investment and the implementation of long-term policies that foster their growth. Human resources also play a critical role in the enterprise development process.

"Enterprises themselves have proactively invested in training, producing a substantial number of engineers, but sometimes there is disconnection between training and practical application, and the availability of high-quality human resources remains inadequate," stated Mr. Hoang Manh Tan. He also noted that Vietnam is becoming an attractive investment destination for the region and the world, evolving into a leading manufacturing hub. Therefore, in addition to mechanisms and policies from regulatory agencies, businesses themselves need to proactively develop strategies to capitalize on opportunities, become pillars of national development, and achieve global reach.

By Ngoc Linh/Tran Minh

Related News

Vietnam and China promote Customs cooperation

Vietnam and China promote Customs cooperation

VCN - The representative of Vietnam Customs and the Ambassador Extraordinary and Plenipotentiary of the People's Republic of China to Vietnam exchanged the Action Plan between the General Department of Vietnam Customs (GDVC), the Ministry of Finance of the Socialist Republic of Vietnam and the General Administration of Customs of the People's Republic of China (GACC) on the Mutual Recognition Agreement on Authorized Economic Operator of Vietnam Customs and the Enterprise Credit Management Program of China Customs, on October 13, 2024, at the Government headquarters.
How to handle export processing enterprises forgetting to open a corresponding import declaration

How to handle export processing enterprises forgetting to open a corresponding import declaration

VCN - From 2014 to 2019, Dragonjet Vietnam Co., Ltd. (headquartered in Que Vo Industrial Park, Bac Ninh) opened 17 on-site export declarations of domestic enterprises, however, the company “forgot” to open a corresponding import declaration. Dragonjet Vietnam Co., Ltd proposed the Customs authority to instruct tax procedures and policies and whether failure to register a corresponding declaration will result in tax imposition?
How does the Fed

How does the Fed's interest rate cut affect Vietnam?

VCN - In the latest meeting of the Federal Open Market Committee (FOMC), the Fed decided to cut interest rates by 50 basis points to a range of 4.75%-5%. Analysts have given different perspectives on this decision.
Important step to soon upgrade stock market

Important step to soon upgrade stock market

VCN - According to experts, the Ministry of Finance's issuance of Circular No. 68/2024/TT-BTC dated September 18, 2024 is an important step in the process towards the goal of improving the quality of the Vietnam’s stock market.

Latest News

Shrimp exports bring home nearly 2.8 billion USD in nine months

Shrimp exports bring home nearly 2.8 billion USD in nine months

Vietnam's shrimp export turnover is estimated at nearly 2.8 billion USD in the first nine months of this year – the highest among aquatic products, according to the Vietnam Association of Seafood Exporters and Producers (VASEP).
Import and export potential growth promised to be vibrant in 6 end- year months, many industries welcome opportunities

Import and export potential growth promised to be vibrant in 6 end- year months, many industries welcome opportunities

VCN- According to Yuanta Securities Company, from now until the end of the year, Vietnam's import and export enjoys many favorable macro factors to recover and accelerate. Many industries will benefit from this momentum such as rubber, textiles, seafood, seascapes, etc.
Seafood exports soar to new heights in the third quarter

Seafood exports soar to new heights in the third quarter

VCN - Seafood exports in the third quarter of this year reached US$2.76 billion, up nearly 13% over the same period last year. This is a peak after 4 years of disruption due to the Covid-19 pandemic.
Understand businesses and markets to expand cooperation opportunities with the United States

Understand businesses and markets to expand cooperation opportunities with the United States

VCN - The demand for shifting supply chains of US corporations is huge. Understanding the needs, standards and working methods of corporations will help Vietnamese enterprises have the opportunity to gain a larger market share in this wave.

More News

Linkage - the "key" to sustainable development of agricultural value chains

Linkage - the "key" to sustainable development of agricultural value chains

VCN - Promoting sustainable and effective development of agricultural value chains is a core factor in restructuring Vietnam's agricultural sector and the key to optimize the value of Vietnam's agricultural exports.
Supporting industry enterprises: Learning standards, understanding opportunities

Supporting industry enterprises: Learning standards, understanding opportunities

VCN - Currently, many potential industries have "opened" opportunities for Vietnamese enterprises to enter, such as the semiconductor industry, supporting industries for the aviation sector. However, the higher the added value of the sector, the more it requires enterprises to meet international standards.
Vietnam’s distinctive agricultural exports to China exhibited in Hanoi

Vietnam’s distinctive agricultural exports to China exhibited in Hanoi

An exhibition showcasing Vietnam’s distinctive farm produce exported to China opened in Hanoi on October 13, featuring the participation of 16 local enterprises and introducing over 50 categories of high-quality products from across the three regions of the country.
100 most valuable Vietnamese brands on the limelight

100 most valuable Vietnamese brands on the limelight

This year’s Brand Finance Vietnam 100 Report was also released to provide a comprehensive picture of the valuations.
Need to quickly act to catch up with the "green" trend

Need to quickly act to catch up with the "green" trend

VCN - With the movement from the global level to Vietnam's main markets, as well as the strong commitment of the Vietnamese Government, the trend of "compulsory green/sustainable transformation" has become clear to Vietnamese businesses instead of voluntary as before. However, the level of readiness of businesses is not high.
Businesses cooperate to develop advanced technology

Businesses cooperate to develop advanced technology

VCN- In order to foster development of the high-tech sector, one of factors is close cooperation between businesses to improve competitiveness and promote innovation.
Export target for 2024 set at US$400 billion

Export target for 2024 set at US$400 billion

VCN - Since the beginning of the year, Vietnam's export activities have continued to recover. It is forecasted that the total export turnover for the entire year may reach a historic milestone of US$400 billion.
Thai Binh intensifies cooperation with Russian localities

Thai Binh intensifies cooperation with Russian localities

A delegation from the northern province of Thai Binh, led by Chairman of the provincial People’s Council Nguyen Tien Thanh, on October 10 met with representatives of the Moscow Chamber of Commerce and Industry, along with several Russian businesses.
Ho Chi Minh City partners with nine provinces to boost import and export activities

Ho Chi Minh City partners with nine provinces to boost import and export activities

VCN - Ho Chi Minh City (HCMC) and nine provinces in the northern and north-central regions are cooperating in socio-economic development, leveraging each region's advantages and potential to boost import and export activities.
Read More

Your care

Latest Most read
Shrimp exports bring home nearly 2.8 billion USD in nine months

Shrimp exports bring home nearly 2.8 billion USD in nine months

Vietnam's shrimp export turnover is estimated at nearly 2.8 billion USD in the first nine months of this year – the highest among aquatic products, according to the Vietnam Association of Seafood Exporters and Producers (VASEP).
Import and export potential growth promised to be vibrant in 6 end- year months, many industries welcome opportunities

Import and export potential growth promised to be vibrant in 6 end- year months, many industries welcome opportunities

VCN- According to Yuanta Securities Company, from now until the end of the year, Vietnam's import and export enjoys many favorable macro factors to recover and accelerate. Many industries will benefit from this momentum such as rubber, textiles, seafood,
Seafood exports soar to new heights in the third quarter

Seafood exports soar to new heights in the third quarter

Seafood exports in the third quarter of this year reached US$2.76 billion, up nearly 13% over the same period last year. This is a peak after 4 years of disruption due to the Covid-19 pandemic.
Understand businesses and markets to expand cooperation opportunities with the United States

Understand businesses and markets to expand cooperation opportunities with the United States

VCN - The demand for shifting supply chains of US corporations is huge. Understanding the needs, standards and working methods of corporations will help Vietnamese enterprises have the opportunity to gain a larger market share in this wave.
Linkage - the "key" to sustainable development of agricultural value chains

Linkage - the "key" to sustainable development of agricultural value chains

Promoting sustainable and effective development of agricultural value chains is a core factor in restructuring Vietnam's agricultural sector and the key to optimize the value of Vietnam's agricultural exports.
Mobile Version