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Vietnam to build product chains to improve competitiveness

Vietnam plans to build product chains to increase the value of the goods and cut out middle men to improve competitiveness. The country has witnessed strong exports in both scale and production. The total export turnover of the country reached $214 billion in 2017, a 21.2 per cent year-on-year increase. Exports this year are also expected to increase as the government has implemented commitments for international integration, reducing import-export taxes.

Government efforts have provided a favorable business environment and aided export activities. Total import-export turnover in the first seven months of this year rose by 12.7 per cent from the same period last year to reach $264.3 billion. Of which, export turnover was $133.6 billion.

Exports continued to maintain high growth of 15.3 per cent in the period, meeting 56.5 per cent of the year’s targets. In addition, the country’s exports depended on foreign directed investment (FDI) enterprises, which accounted for 70 per cent of total turnover.

However, the sector has mainly performed cutting and sewing in the global garment and textile supply chain. Vietnamese garment and textile firms have participated in simple outsourcing and lack the ability to provide packaging, resulting in low added value. The garment and textile industry has also relied on imported materials. The local companies had to import up to 86 per cent of cloth for production and exports.