Diversifying supply sources for businesses to participate in the global value chain

Scene of the Business Forum 2024.

In the positive results of our economy in the first 6 months of 2024, a strong recovery of export activities is recorded with an estimated turnover of nearly US$ 189 billion, an increase of 13.8% over the same period in 2023. Notably, in some key products, export turnover increased not only from market demand but also from a certain shift of orders from other countries to Vietnam.

However, Vietnamese trade also faces some challenges. According to experts, although the supply chain has gradually been restructured, in fact the majority of Vietnam's industrial businesses are still small and cannot participate deeply in the value chain.

Information at the Business Forum 2024 "Diversifying supply chains, developing markets, improving adaptability for businesses" organized by Business Forum Magazine in coordination with relevant agencies in the afternoon on June 26, Mr. Hoang Quang Phong, Vice Chairman of the Vietnam Confederation of Commerce and Industry (VCCI), said that Vietnam had nearly 900,000 operating businesses, but large businesses only account for about 2%, the rest are small and micro businesses.

Meanwhile, the main problem with small and medium-sized businesses was lack of management skills, little technological innovation, and limit ed access to finance. This led to the business connection between domestic and foreign investors remaining extremely blurred.

Also on this issue, Mr. Nguyen Van Hoi, Director of the Institute for Industry and Trade Strategy and Policy Research, Ministry of Industry and Trade, said that the challenges for the business community were still very large, with difficulties coming from policies. Promoting growth model transformation was ineffective, policy implementation lacked vision...

Therefore, to solve this problem, experts and businesses believed that it was necessary to deploy many specific groups of solutions, such as promoting the development of supporting industries and increasing new production capacity to proactively create new supply of raw materials, fuel, and materials, meeting production needs and improving the added value and competitiveness of exported goods.

Businesses need to take advantage of free trade agreements, focus on domestic connections to participate in production and supply chains of FDI businesses and large global ones, creating markets for developing industries. …

Authorities need to create favourable conditions and have solutions focusing on removing technical "barriers" for businesses to penetrate new markets; Strengthen digital transformation in the issuance of preferential Certificates of Origin (C/O) and propaganda, guidance on rules of origin and issuance of C/O, self-certification of origin... Along with promoting development of logistics services, contributing to reducing costs and improving competitiveness for Vietnam's export goods...

Dr. Nguyen Tu Anh, Director of the Center for Economic Information, Analysis and Forecasting (Central Economic Committee), said that the world economy was tending to be polarized and global investment flows were shifting strongly, helping to open up the development potential of Vietnam's economy in the medium and long term. The government was trying to support businesses, so businesses need to look ahead at risks and challenges to proactively find solutions and seize opportunities.

Economic expert Le Duy Binh, Director of Economica Vietnam, also commented that to invest a large amount of capital in the global supply chain, businesses must have confidence that the investment must be safe and if they want to be safe, policy mechanisms or legal regulations must be stable. Therefore, the improvement of mechanisms and policies towards stability and transparency was essential to be maintained to support businesses to feel secure in investing and participating in the global supply chain.