Vietnam is the 12th largest electronic exporter in the world
Vietnam`s electronics industry has been formed slowly, with relatively rapid growth over the years and increasingly plays a more important role in industrial production and export of the economy.
According to the Central Institute of Economic Management (CIEM), Vietnam has been the 12th-ranking electronic exporter over the world and the third-ranking in the ASEAN.
Vietnam is the 12th largest electronic exporter in the world
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Out of the ten largest electronic projects in Vietnam since 2003, Samsung ranks first with four manufacturing complexes and a total registered capital sum of over $17.3 billion, followed by projects of Inter, LG, Canon, Nokia, Panasonic, but no large-scale projects by Vietnamese enterprises.
Despite the country’s rising exports, Vietnamese electronics producers are still weak. Companies like Vietnam Electronics and Informatics Corporation (Viettronics) and Hanel Corporation mainly import SKD (semi knocked down) and IKD (incompletely knocked down) units to assemble and meet urgent market demand. Developing without long-term strategy, the Vietnamese electronics market is in serious imbalance now.
There are 610 electric and electronic components producers nationwide, accounting for 53.28 per cent of the total electronic sector’s businesses—a disconcertingly low proportion.
Almost all Vietnamese businesses deploy sporadic orders, providing materials and simple components, such as packaging, plastic spare parts, metal, and logistics services such as transportation and sanitation.
They have not been able to manufacture important components with higher added value yet. Almost all electronic products are assembled from imported components.
With Japanese partners like Canon and Brother, Vietnamese businesses sign contracts for a series of products for a relatively long time. However, these contracts, along with indirect contracts with subcontractors, are relatively few in number. Additionally, the linkages between domestic enterprises are very weak.
Bang Hyun Woo, deputy director general of Samsung Vietnam, said that Vietnamese companies produce more sophisticated components rather than just packaging and palletising. The localisation rate of Samsung mobile phones was 57 per cent at the end of 2016. As many as 29 Vietnamese firms are direct suppliers for Samsung now.
Samsung has been doing their utmost to seek out and support Vietnamese firms to take part in its supply chain. However, Vietnamese businesses have to raise their knowledge by inviting experts who have long experience working with Korean and Japanese firms.
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