SMEs must seek place in global supply networks

Friday, Sep 18, 2015 10:36

Small- and medium-sized businesses must meet standards in origin of goods and improve competitiveness to join the global supply chain, said experts. — Photo

HA NOI (Biz Hub) — The domestic small- and medium-sized enterprises (SMEs) should define positions in the global supply chain to gain success in integrating into the world economy.

Nguyen Thi Tuyet Minh, chairwoman of the Viet Nam Women Entrepreneur Council (VWEC) and also chairwoman of the ASEAN Women Entrepreneur Network, made this remark at a workshop on improving SME access to regional and global markets, on September 17 in Ha Noi.

The event held by the United States Agency of International Development (USAID), the US-ASEAN Business Council (US-ABC) and the Viet Nam Chamber of Commerce and Industry (VCCI) attracted 130 SMEs operating in many business sectors in the country.

According to the Asian Development Bank's Asian Development Outlook, only 36 per cent of Vietnamese enterprises have joined the global production and export network against 60 per cent in Malaysia as well as Thailand. Meanwhile, 21 per cent of Vietnamese enterprises have joined the global supply chain compared with 30 per cent of Thai enterprises and 46 per cent of Malaysian companies.

In fact, Vietnamese firms have assembled, processed and supplied alternative components but not produced main products.

At the seminar, Hoang Quang Phong, VCCI deputy chairman, said establishment of the ASEAN Economic Community (AEC) by this year-end and free trade agreements between Viet Nam and its partners would be a golden opportunity for local enterprises to integrate with the global supply and value chains for expanding export markets, attracting investment and receiving technological transfers.

Deputy Minister of Planning and Investment Dang Huy Dong said that with the trend of globalisation and economic integration, the local SMEs are considered the sector with great potential in joining further into the regional and global supply chain.

However, Phong said the local firms, especially SMEs, must face challenges due to low competitiveness, management at low level and limitation in integration ability.

Therefore, local firms need the State's policies to create good conditions for the development of the enterprise, Phong said.

Dang Phuong Dung, deputy chairwoman and general secretary of the Viet Nam Apparel Association, said joining the global and regional markets has forced local enterprises to reform and increase competitiveness for the remaining businesses in the market.

The local firms must meet standards in the origin of goods, reduce spending of enterprise and improve competitiveness when joining the global supply chain, Dung said.

Nguyen Binh, senior manager of FedEx Indochina and Myanmar, said Viet Nam has joined the global supply chain and that has promoted Viet Nam's economy.

However, local firms should improve further to get more chances to join the global supply chain and increase their competitive ability on the world market, Binh said.

The local firms need good managers with knowledge of integration and the market to take a chance on business and measures to increase production of the enterprise in the chain, he said.

For the long-term, the firms should improve product quality, productivity and production efficiency to reduce production cost and increase the competitiveness of products.

Meanwhile, Dung said local firms should promote co-operation to create a production chain among them.

During the seminar, experts from multi-national companies United States, such as FedEx, Microsoft, MasterCard and Baker&McKenzie shared their experiences in many issues such as supply chain management, cloud technology, digital payment and regulations in business. — VNS

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