Apple, one of the world's largest technology corporations, has decided to move 11 manufacturing factories to Vietnam. This move marks a strong trend of shifting global supply chains and brings opportunities as well as challenges for Vietnamese businesses participating in this supply chain.
According to information from Vietnam Times, the Ministry of Industry and Trade organized an online seminar titled "Vietnam - Strategic position in the global supply chain: Opportunities and challenges" on September 5. via. The seminar emphasized the shift in global supply chains that is strongly affecting smaller countries like Vietnam. A typical example is Apple Inc. of the United States has moved 11 audio and video equipment factories to Vietnam.
Intel Corporation has also expanded the second phase of its chip testing factory in Ho Chi Minh City with a total value of 4 billion USD, while Denmark's Lego Group has invested in building a factory in Binh Duong. with a total investment capital of 1 billion USD. Large US corporations such as Boeing, Google and Walmart have also researched the business investment environment in Vietnam, sought to expand supplier networks and develop production facilities in Vietnam.
Currently, Samsung has moved its entire phone production line to Vietnam and India. 60% of Samsung smartphones sold globally are manufactured in Vietnam. This shows both opportunities and challenges for Vietnamese businesses participating in the global supply chain.
According to Mr. Ngo Khai Hoan, Deputy Director of the Department of Industry, currently Vietnamese enterprises participating in the supply chain are only at the intermediate stage, with low added value. The main raw materials supplied to the processing, textile and footwear industries are mostly imported. According to Mr. Hoan, in the past, Vietnam took advantage of cheap labor, but now labor costs are increasing, so we are gradually losing this advantage.
To seize opportunities from foreign direct investment (FDI) enterprises expanding factories in Vietnam, the Ministry of Industry and Trade focuses on activities such as policy development and training support to improve the capacity of businesses. Accordingly, Decree 111/2015 on supporting industry development has preferential policies for this industry. However, in accordance with the new situation, the Ministry of Industry and Trade has submitted to the Government a draft amendment to Decree 111/2015 to create more favorable conditions for supporting industry enterprises to enjoy additional incentives. , improve capacity and increase competition with foreign competitors.
Now, we have taken another step to upgrade the factories of Vietnamese supporting industry enterprises through a memorandum of understanding to develop 50 smart factories with Samsung,” Mr. Hoan said. . Yang Yoon Ho, customer relationship manager of Samsung Electronic Vietnam Company, said that through the smart factory program, Samsung shares its expertise in smart manufacturing with 50 businesses under a two-year plan. Currently, Samsung has completed the smart factory project with 26 local businesses and will continue to expand to other localities in the near future. “Through this project, we hope Vietnamese businesses will improve their competitiveness according to global standards. There will be many Vietnamese businesses participating in the supply chain of Samsung and global businesses," Yang Yoon Ho said.
According to Vietnam Times, since 2015, Samsung Korea's manufacturing experts have worked with 400 Vietnamese businesses to improve production management and quality towards developing potential supplier supply chains. These businesses reported a 40% increase in productivity and a 50% reduction in product defects after three months of support. These companies are given priority to join the supplier network for Samsung Vietnam. Up to now, Samsung continues to look for suppliers.