Vietnam seeks foreign investment to enhance support industry capacity
Vietnamese supporting industry enterprises are making efforts to improve their products and performance in order to take advantage of investment shifts into the country and expand opportunities to join the global value chain.
A series of giant manufacturers operating in Vietnam, among them Panasonic, Bosch, TTI, Samsung, and Klaus, are seeking additional local suppliers and increasing their localization rate in order to optimize production and business efficiency. To welcome the shift of foreign investment, numerous domestic companies have made great strides to improve their capacity in the race to become major suppliers for large international corporations.
In 2019 and 2020, for example, three member companies of the An Phat Holdings Group (APH) implemented consulting programs on improvement and development of supporting industries offered by the Ministry of Industry and Trade (MoIT) and Samsung. APH's long-term goals are to improve the localization of products, develop high-tech products, expand investment, and deepen and enhance its position in the global supply chain.
Dong Nai Province prioritizes investment attraction in support industries
According to Le Tri Tin, Deputy Production Director of the CLF Plastics Company Limited that participated in the consulting program, in order to quickly integrate into the global supply chain, the capacity of Vietnamese enterprises must be enhanced. Its own participation in the program helped it strengthen management and operations, meet global standards, achieve high efficiency in production, improve capacity and become a supplier for FDI enterprises and multinational corporations.
Effective FDI projects
According to the Dong Nai provincial management board of industrial parks, since early this year, the province has attracted 66 FDI projects, with a total capital of more than US$680 million, almost achieving the annual goal of US$700 million. The projects are mainly in the province’s prioritized fields such as supporting industry, machinery and equipment, and intensive processing of agricultural products.
FDI enterprises investing in Dong Nai’s supporting industry generally have links with global multinational corporations and can therefore provide advantageous conditions for the consumption of output products. For example, many FDI enterprises in Dong Nai are producing electronic components for the Samsung Group; Meggitt Vietnam Co., Ltd. manufactures aircraft engine components for the world's major aircraft manufacturers; and Hyosung Dong Nai Co., Ltd. supplies yarn products to many corporations in the United States and Europe.
A representative of the Management Board of the Saigon Hi-Tech Park also said that in October 2020, the park signed an agreement with the management board of industrial parks and export processing zones in provinces in the Southern Key Economic Zone, forming a network to help small and medium-sized supporting industry enterprises expand domestic and foreign markets.
Vietnam will continue to give priority to attracting investment projects in supporting industries that apply advanced, modern and environmentally friendly technologies, and in those effectively using natural resources, minerals and land. It will also strive to strengthen links between foreign-invested and domestic enterprises.
VietNam Economic News