31st Sea Games - Vietnam 2021 Covid-19 Pandemic
Home / Economy / Industry
Symbiotic environment - a need to promote win-win formula
Hai Yen 09:47, 2021/04/28
Symbiosis is seen as an important link facilitating the cooperation between local and foreign direct investment firms in Vietnam.

Vietnamese firms would have no chance to join their foreign peers’ supply chains once the latter shift their entire value networks to Vietnam, as such, government policies are needed to encourage more local firms to strengthen the linkage between those two sides.

 Production at Toho Vietnam in Thach That industrial park, Hanoi. Photo: Thanh Hai

Chairman of the Vietnam Chamber of Commerce and Industry (VCCI) Vu Tien Loc made the statement in a recent conference discussing new opportunities for the business community in a new context.

“A symbiotic environment in this case is necessary to facilitate such cooperation,” stressed Loc, saying this is increasingly important at a time when there has been a growing trend of production chains from multinationals moving into Vietnam.

Loc also pointed out the fact that more than 30 years since Vietnam opening its economy to the world, foreign capital is still concentrated on labor-intensive industries requiring basic skills, including footwear or garment.

“As 67% of machinery and input materials are imported, added-value created from these industries remains modest, while there have been limited spillover effects from high level corporate governance and modern technologies in the FDI sector to the domestic enterprises,” Loc stated.

“If provinces/cities are still focusing on attracting billion-dollar projects and ignore the growth quality, there would be a lack of incentive for Vietnamese and FDI firms to cooperate for mutual benefits,” Loc continued.

While the Covid-19 pandemic is wreaking havoc on global economy, Loc said foreign investors are holding high hope for Vietnam’s investment and business environment.

“Vietnam is fast becoming a top choice for firms looking to diversify  their investment destinations, thanks to the country’s effective containment of the pandemic, political stability and effective anti-corruption measures,” he added.

The VCCI Chairman urged government agencies to push for greater reform in administrative procedures, including a simplification in protocols for business registration, customs process, taxes and social insurance, along with improvements in infrastructure system for greater economic competitiveness.

As of present, 136 countries/territories have invested in Vietnam with a combined investment capital of over US$400 billion.

FDI capital remains a key source in state budget revenue, while ensuring social welfare through job creation and aiding the fight against poverty.

As Vietnam is pushing for global economic integration, the FDI sector is one of the key driving forces to boost the country’s exports, accounting for 70% of the country’s export turnover, and taking made-in-Vietnam products into global supply chains.

TAG: Vietnam VCCI FDI domestic firms global supply chains value chains garment footwear
Other news
18:17, 2022/17/29
Agritech, Greentech, Deeptech and Foodtech - foreign funds interests in Vietnam
The Vietnamese Government has issued many mechanisms and policies to attract foreign-invested enterprises, including foreign tech startups.
16:58, 2022/58/29
New businesses formation hits record high in H1
The positive business environment is conducive to the reinstatement of nearly 41,000 enterprises, a whopping 55.6% increase year-on-year and nearly double the average figure in the previous five years.
15:46, 2022/46/29
Vietnam's GDP in 2Q hits decade-high
The positive economic performance in the second quarter helped Vietnam’s GDP growth reach 6.4% year-on-year in the six months.
00:19, 2022/19/29
Vietnam to draft national action plan for circular economy adaptation
The adaptation of circular economic models would help Vietnam realize its commitment to net-zero carbon emissions target by 2050.
12:09, 2022/09/27
Vietnamese Goods and Gastronomy Week underway in the UK
The event aims to promote among British consumers and retailers high-quality Vietnamese products that are benefiting from the UK-Vietnam Free Trade Agreement (UKVFTA).
11:54, 2022/54/25
Vietnam – Germany, dynamic duo for energy transition: GIZ
Germany helped Vietnam initiate its Smart Grid roadmap in 2017 when the Southeast Asian country did not yet have a complete energy transition concept and had not yet committed to net zero.