Foreign direct investment (FDI) accounted for most of the nation's totalelectronic export turnover, according to a report from the VietnamElectronic Industries Association.
At the same time, the number of FDI enterprises represent only one-third of electronic enterprises in Vietnam.
Thecountry's quick development in the electronics industry has mostlyoccurred due to the efforts of the FDI sector, the Thoi Bao Kinh Doanhnewspaper (Business Times) said, quoting Luu Hoang Long, Chairman of theVietnam Electronics Industries Association.
Export turnover oftelephones and spare parts was 24.1 billion USD in 2014, increasing by13.4 percent compared to that in 2013. However, export turnover oftelephones and spare parts within the FDI sector accounted for 99.6percent.
Further, the value of exported electronics, computersand spare parts last year totalled 11.6 billion USD. Yet, of thisnumber, the FDI sector accounted for 98.8 percent.
Someelectronics FDI giants accounting for a large proportion of market sharein the total export turnover of Vietnam's electronic industry,including Samsung, with factories in the northern provinces of ThaiNguyen and Bac Ninh, along with its electronics spare partsmanufacturers from KSD Vina Company, Morips Vina and Orientech Vina.
Canonand LG are also increasing their investments in Vietnam, turningVietnam into one of the largest manufacturers of mobile phones, as wellas printing and photocopy machines for their brands.
Experts havesaid that FDI enterprises expanding their scale of production inVietnam will be a premise for Vietnamese spare parts and serviceproviders to build large and long-term business plans.
Of the 90satellite enterprises producing spare parts for Samsung, only six toseven Vietnamese enterprises produce such parts. These enterprisesprovide mostly printing and wrapping products.
Vu Quoc Huy,deputy head of the Ministry of Planning and investment's Department forEconomic Zones Management, said that Vietnamese enterprises account foronly 10 percent of the total providers.
The participation ofVietnamese enterprises, in association with Canon, is unremarkable,involving mainly sectors that require simple technology. Spare parts andcomponents requiring high degrees of accuracy are imported from othercountries or produced by FDI enterprises, Huy added.
According tostatistics from the Japan External Trade Organisation (JETRO), whichfeature the comparison of domestic spare parts and raw materials andauxiliary materials provided for industrial products, Vietnam accountsfor only 27.8 percent of the industrial production value while China andThailand account for 50-60 percent. Therefore, the added value ofVietnamese products only stands between 15 and 30 percent.
Further,customers who purchase a mobile phone from Sony see that only earphonesare labeled as being "Made in Vietnam". Other parts are produced byforeign producers.
According to experts, Vietnam's domesticelectronics enterprises are weak in competitiveness in all domestic,regional and international markets.|
One of the reasons theelectronics industry remains weak is that import taxes on spare partsremain high, while import taxes are lower (five or zero percent) forcompletely built products, which encourages enterprises to import thelatter, instead of selling domestically- produced ones.
Despitethe launch of the "Vietnamese Use Vietnamese Goods" campaign,enterprises, especially state-owned enterprises, always face technicaland non-technical barriers.
To increase added value and the grossdomestic product (GDP) of Vietnam through the electronics industry, thecountry should not increase labour costs, which will make the nationlose its initial competitive advantages, said Long.
He advisesdomestic enterprises to boost the manufacturing of spare parts for FDIproviders. Boosting Vietnamese enterprises that manufacture electronicproducts, information and technology for other producers will increasethe value-added proportion of products made in Vietnam.
Toenhance the competitive capacity of electronics enterprises, companiesshould carry out synchronous measures, from production to distribution,as well as creating government policies supporting enterprises, saidLong.-VNA
At the same time, the number of FDI enterprises represent only one-third of electronic enterprises in Vietnam.
Thecountry's quick development in the electronics industry has mostlyoccurred due to the efforts of the FDI sector, the Thoi Bao Kinh Doanhnewspaper (Business Times) said, quoting Luu Hoang Long, Chairman of theVietnam Electronics Industries Association.
Export turnover oftelephones and spare parts was 24.1 billion USD in 2014, increasing by13.4 percent compared to that in 2013. However, export turnover oftelephones and spare parts within the FDI sector accounted for 99.6percent.
Further, the value of exported electronics, computersand spare parts last year totalled 11.6 billion USD. Yet, of thisnumber, the FDI sector accounted for 98.8 percent.
Someelectronics FDI giants accounting for a large proportion of market sharein the total export turnover of Vietnam's electronic industry,including Samsung, with factories in the northern provinces of ThaiNguyen and Bac Ninh, along with its electronics spare partsmanufacturers from KSD Vina Company, Morips Vina and Orientech Vina.
Canonand LG are also increasing their investments in Vietnam, turningVietnam into one of the largest manufacturers of mobile phones, as wellas printing and photocopy machines for their brands.
Experts havesaid that FDI enterprises expanding their scale of production inVietnam will be a premise for Vietnamese spare parts and serviceproviders to build large and long-term business plans.
Of the 90satellite enterprises producing spare parts for Samsung, only six toseven Vietnamese enterprises produce such parts. These enterprisesprovide mostly printing and wrapping products.
Vu Quoc Huy,deputy head of the Ministry of Planning and investment's Department forEconomic Zones Management, said that Vietnamese enterprises account foronly 10 percent of the total providers.
The participation ofVietnamese enterprises, in association with Canon, is unremarkable,involving mainly sectors that require simple technology. Spare parts andcomponents requiring high degrees of accuracy are imported from othercountries or produced by FDI enterprises, Huy added.
According tostatistics from the Japan External Trade Organisation (JETRO), whichfeature the comparison of domestic spare parts and raw materials andauxiliary materials provided for industrial products, Vietnam accountsfor only 27.8 percent of the industrial production value while China andThailand account for 50-60 percent. Therefore, the added value ofVietnamese products only stands between 15 and 30 percent.
Further,customers who purchase a mobile phone from Sony see that only earphonesare labeled as being "Made in Vietnam". Other parts are produced byforeign producers.
According to experts, Vietnam's domesticelectronics enterprises are weak in competitiveness in all domestic,regional and international markets.|
One of the reasons theelectronics industry remains weak is that import taxes on spare partsremain high, while import taxes are lower (five or zero percent) forcompletely built products, which encourages enterprises to import thelatter, instead of selling domestically- produced ones.
Despitethe launch of the "Vietnamese Use Vietnamese Goods" campaign,enterprises, especially state-owned enterprises, always face technicaland non-technical barriers.
To increase added value and the grossdomestic product (GDP) of Vietnam through the electronics industry, thecountry should not increase labour costs, which will make the nationlose its initial competitive advantages, said Long.
He advisesdomestic enterprises to boost the manufacturing of spare parts for FDIproviders. Boosting Vietnamese enterprises that manufacture electronicproducts, information and technology for other producers will increasethe value-added proportion of products made in Vietnam.
Toenhance the competitive capacity of electronics enterprises, companiesshould carry out synchronous measures, from production to distribution,as well as creating government policies supporting enterprises, saidLong.-VNA
