Fierce competition forecast for domestic industrial production

10:55 | 11/11/2015 Industry

Industrial products will not have it easy against those from countries with outstanding advantages, as well as cheap imported goods, when Viet Nam joins the Free Trade Agreements (FTAs).

Fierce competition forecast for domestic industrial production

n the first 10 months of the year, the processing and industrial products accounted for 79 per cent of the country's total export turnover — Photo casuminaradial.com

"The industrial sector has always been a key pillar in the country's economy with continuous growth increase and a leading position in exported staples," Tran Tuan Anh, deputy minister from the Ministry of Industry and Trade (MoIT) said.

He told a conference on ‘Sustainable Export Growth of Industrial Products' held in Ha Noi yesterday that enterprises should also update information regularly on export markets, consumption habits and import policies of foreign countries.

He urged a closer connection among ministries, sectors, the business community and associations to exchange information on FTAs or Trans-Pacific Partnership (TPP).

Tran Thanh Hai, deputy director of the ministry's Import-Export Department said that in the first 10 months of the year, the processing and industrial products accounted for 79 per cent of the country's total export turnover. Several sectors including mobile phone and spare parts, garment and textile, shoes, and computers, apart from electronics spare parts, and transport vehicles, had relatively high growth thanks to international integration and on joining the FTAs, which have helped expand markets.

In addition, FDI inflow in Viet Nam, which was mainly in the industrial sector, has also been considered a factor to promote exports of products.

However, he also said the sector was faced with difficulties in terms of its sustainable export growth. The fierce competition with foreign rivals could be unavoidable. The non-tariff barriers with stricter requirement on products' quality would become more popular. On the other hand, the support industry has not been well developed, making Viet Nam a small cog in the global value chain. Big industries such as garment and textile, leather shoes, mobile phones and electronics products have high outsourcing rates, and have not brought high value adds to the economy.

Vietnamese firms, which have not been active in their material supply for production, have also faced a challenge in proving the certificate of origin (C/O) to enjoy benefits from FTAs.

However, he said, the biggest challenge was still the low competitive capacity of Vietnamese businesses in the fields of quality, prices and product persity, as well as the ability to adapt quickly to rapid changes in markets and customers.

Vu Van Thanh, deputy general director of Hoa Sen Group, suggested that State agencies and associations should further support businesses to help them develop in the face of fierce competition./.

Source: VNS



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