Inside a floor tile manufacturing of Hoang Gia Investment and Trading Joint Stock Company. — Photo courtesy of the companyHanoi (VNS/VNA) - Vietnam is entering a level playing field in whichefficient solutions to maintain economic development always causes headachesfor experts and business leaders.
Data released by the General Statistics Office recently showed that Vietnam’s10-year consecutive export growth declined in the first half of this year, withonly 238.4 billion USD in value, down 2.1 percent year-on-year.
However, there are several bright spots, including the export turnover of goodsto the US reaching 30.3 billion USD, up more than 10 percent.
The US was still Vietnam’s largest export market in the first half of thisyear, outstripping China at 19.5 billion USD.
Talking about exports to the US, a market of more than 300 million people andthe highest purchasing power and expenditure in the world, Dinh Viet Anh,Chairman of Hoang Gia Investment and Trading Joint Stock Company – the secondlargest manufacturer of floor tiles in Vietnam – said people in the US peoplechange the interior of their houses whenever they change tenants. They are alsolikely to renovate their own houses after a few years.
“Therefore, the consumption of materials in the US market usually ranks firstin the world,” Anh said.
Anh said this is one of the reasons that Royal Crystal Joint Stock Company, ajoint venture between Hoang Gia and Crystal Plastic Manufacturing andTechnology Joint Stock Company (PLP) – a listed company on HOSE – decided topour capital into the production of SPC plastic bricks, with export-orientedfocus on the US.
PLP currently owns a quarry in the central province of Nghe An with reserves ofmore than five million tonnes of PVC, a plastic material.
Plastic bricks have just appeared on the world market in the last two yearswith a core layer of calcium carbonate (CaCO3) stone powder.
In the US market, this material has accounted for 50 percent of the flooringmarket share, reaching an unexpected growth rate for the material distributors.
According to Chairman of FPT Corporation Truong Gia Binh, the domestic marketwith nearly 100 million people is important, but Vietnamese businesses can onlygrow if they reach out.
In the first five months of this year, while FPT’s domestic revenue sharplydecreased compared with the same period last year, its foreign market stillmaintained growth, with 20 percent in the EU, 18 percent in the US and 15 percentin Japan.
Economic expert Phan Van Truong, a trade advisor to the French Government, saidto help Vietnamese businesses reach out to the global market, it needed astrategy supported by the Government at the national level.
In the field of international trade, Truong said most advanced countries havetheir economic and trade counsellor teams located in the embassies in the hostcountry. These people, most of them technical or commercial specialists, ratherthan administrative officials, help every citizen of their homeland who wish toexport to the host country, providing them with full of information, facts,statistics, contacts, as well as historical and geographical knowledge forquick success.
“Even with that information, there is the stage of market analysis,competitors, prices, and directories of intermediaries or distributors,” Truongsaid.
“Many countries also have safe trade insurance mechanisms for businesses whowant to export. And yet, their banking system is very popular in foreigncountries – this is a very beneficial stage for export businesses because thebank is an effective support point,” he added.
It is difficult to rely on support policies, so many businesses have decided tolist on the stock market, taking advantage of opportunities to mobiliseinvestment capital in the global market.
Vicostone Joint Stock Company, an affiliate of Phenikaa Group, is one firm thathas shifted its strategy from production of normal products to luxury ones, andfrom domestic consumption to exports.
Success in the international market has brought Vicostone to the top fourlargest artificial stone manufacturers in the world, joining the club of listedcompanies with trillions of dong in profit.
Many others including Vingroup, Hoa Phat, Vinh Hoan, Viglacera and FPT haveincreasingly expanded production with big investment thanks to the mobilisationof capital through the stock market. This is also the core value for businessesto attract more investors.
Truong said Vietnamese businesses need a mindset to create more value and moreprofits. “If you want a sustainable profit policy, there is only one roadmap:rapid technological change, adding value and quality.”
Ho Xuan Nang, Vicostone's Chairman, said that R&D is a mandatory conditionto ensure sustainable development and growth. Without R&D, enterprises, nomatter how successful, can only be a short-term business.
“However, in order to do effective R&D, businesses must have determination,vision, and long-term financial and human resources,” Nang said.
Chairman of PLP, Mai Thanh Phuong said after more than two years of investmentin R&D with support from the country’s leading professors and doctors, thecompany has mastered the formula of mixing CaCO3 stone and additives,conducting technology in the creation of the core layer of SPC bricks.
“We will continue investing in R&D to improve labour efficiency, creatingdifferentiated products with competitive advantages and high added value,” Phuongsaid.
Economic expert Truong said Vietnamese businesses do not lack ambitions andaspirations.
“It is important that we must further disseminate the spirit of going abroad,encouraging and providing them with an effective export policy, a robust andorganised personnel and information, as well as a competitive tax code.”
“Then we will see how dynamic and effective Vietnamese businesspeople are,” Truongsaid./.
VNA
