Recovery in production, driving force for accelerated export growth

Industrial production recovery drives export growth.

Quality determines market scope

Emphasizing market development from the beginning of the year, Ms. Nguyen Thi Hai Nga, Head of Import-Export Department at Zongshen Vietnam Engine Manufacturing Co., Ltd., stated that the export orders for the enterprise in 2024 are quite optimistic. The company's export items are gasoline engines and electric vehicle engines. Currently, the company has exported to many markets worldwide. By mid-2024, there are already orders from markets for the rest of the year.

How to develop the market? Ms. Nguyen Thi Hai Nga shared that Thailand is the first export market for the company when it started its export strategy. Currently, the company's products have been exported to the US market, and the next target is the market of Taiwan (China), the Philippines, Malaysia, and possibly Europe. With a large market like the US, Ms. Nguyen Thi Hai Nga informed that when accessing this market, initially the company only had two partners, but now it has increased to dozens. However, to enter this market, US partners are very concerned about the company's infrastructure, product quality commitment, as well as compliance with the company's legal regulations. Therefore, they will conduct inspections. Factors such as the living conditions of employees, working conditions, employee welfare policies... are also issues that US partners are concerned about when deciding to purchase products.

"When a company has successfully passed through investigations, and its products introduced to the market are highly regarded by consumers for their quality, the number of customers continues to increase," Ms. Nguyen Thi Hai Nga said and added that currently, the company is focusing on investing in infrastructure and human resource training. With the set plans and the current order situation, the company expects smooth production and business operations in 2024, as well as in 2025.

Similarly, Duc Thanh Wood Joint Stock Company has received many optimistic signals as both existing and new customers continuously place numerous orders. Currently, the company has mobilized all its workforce to support production, arranged personnel, machinery, and suitable raw materials, delivering on schedule to customers.

Increasing product value

In the textile industry, despite facing many challenges such as decreasing orders, supply chain risks, digital transformation trends, economic cycles, and green initiatives... the outlook for export growth remains positive due to the prospects of global economic recovery as well as forecasts for Vietnam's economic situation.

Deputy Director of the Trade Promotion Agency (Ministry of Industry and Trade) Le Hoang Tai stated that to date, many international textile manufacturers have been expanding their operations into Vietnam, thereby boosting the already thriving domestic industry. Furthermore, being a member of new-generation free trade agreements such as the Regional Comprehensive Economic Partnership (RCEP), the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the EU-Vietnam Free Trade Agreement (EVFTA)... continues to serve as positive foundations for the industry's development in the upcoming period.

Assessing the production and export situation in the first month of the year, Mr. Michael Kokalari, Director of Macroeconomic Analysis and Market Research at Vinacapital, believes that exports continued to rise in the fourth quarter, surging by a substantial 42% compared to the same period in January 2024, thanks to a 33% increase in the export of high-tech electronic products (which accounted for one-third of Vietnam's total exports). Additionally, manufacturing saw a 19.3% growth compared to the same period in January 2024, indicating that export growth outpaced production growth. This implies that manufacturers' inventories decreased in the previous month. The combination of inventory depletion and increased new orders signifies that production activities at factories in Vietnam will need to be intensified to meet the rising demand for "Made in Vietnam" products.

Regarding export market development, the Vietnam Trade Office in the United States suggests that businesses need to diversify their product range, adopt systematic approaches to market access and penetration, enabling Vietnamese goods to leverage competitive advantages and increase their presence in various markets. Furthermore, it is crucial to increase and diversify the range of flagship export products, promote the exchange of competitive product groups with high technology content, high added value, deep processing, green economy products, circular economy products, and so forth.