Vietnam aims to become an industrialized world exporter with highly competitive industries by 2030. Vietnam has set itself the target of being one of the top 15 largest exporters in the world.
The direct goal of the country is to develop 20 products with strong international brands, to strengthen its position in the global supply chain, to enhance the capacity of the supporting industry to meet 70 percent of the domestic demand and localization of production to 45 percent, according to a report from the Ministry of Industry and Trade (MoIT).
Vietnam’s support industry, which has remained underdeveloped and overly dependent on imports, has been identified as a major weakness for the country, especially in key industries such as electronics, textiles, leather and shoes, manufacturing and automobiles, local media reported.
The effect has become painfully apparent since the pandemic, as Vietnam’s main parts suppliers, including Chia, South Korea and Japan, were hit hard by Covid-19, severely disrupting production in the country.
In addition, over-reliance on external supplies has paralyzed the development of indigenous support industries, while deeply affecting the profitability of domestic companies.
For example, the economy depends on China and South Korea for no less than 90 percent of the raw materials for textiles, footwear and electronics.
Experts have long expressed concern about the country’s inability to contribute more to product value, putting it at significant economic risk in the event that major global companies decide to relocate production.
To address the problem, the MoIT has proposed a restructuring plan for the country’s industries, focusing on the development of support industries.
Significant progress had been made in the period 2011-20, according to the MoIT, with industrial production accounting for about 27.45 percent of the country’s total GDP annually.
The ministry advised the government to focus on qualitative rather than quantitative development and to take measures to improve productivity, one of the main weaknesses of the economy.
By the end of 2030, industrial production should account for 40 percent of total GDP, with a value added of more than $2,000 per capita, with 45 percent contributing 45 percent from high-tech industries, the MoIT said.
One of the top priorities for the next 10 years is to restructure many state-owned, self-owned companies that have been underperforming for decades and losing billions of dollars, according to the MoIT.