Seizing Int’l Demand from Providing Products of High Quality Localization

While the world’s largest emerging economies including Russia, Brazil and China falter, Vietnam’s steady economic growth at near 7 percent this year will make it being a standout investment country. But despite the fact that there are ample opportunities for investors to Vietnam's market, many small and medium businesses have yet to overcome difficulties in the area of high-quality machinery and equipment, even to the spare parts to catch this chance.

 

According to a survey of the Japan External Trade Organisation (JETRO), in the supporting industry, although the localisation rate of Japanese enterprises in Vietnam has reached 32.2 percent, up 4.3 percentage points compared with the year before, this level is still low compared to 64 percent in China, 53 percent in Thailand, 42 percent in Malaysia and 41 percent in Indonesia. Mr. Daisuke Hiratsuka, Executive Vice President of JETRO said that “International enterprises when making investments in Vietnam have to encounter huge costs of importing components, which pushes up production costs. Therefore, to become more attractive to the investors and more competitive as well as to prepare for the TPP, AEC and Vietnam’s industrialization in 2020, the development of supporting industries and localization is crucial”.

 

Reported by Reuters, the Vietnamese government plans to invest a total of 1.72 trillion dong ($77 million) in supporting industries over the next 10 years. About 52% of this — 890 billion dong — will be used to subsidize research and development projects. Launched in January, the initiative is focused on improving the technical capabilities of domestic companies.

 

Indeed, "In a very competitive global environment, domestic provide ability is king. Some of the world’s biggest manufacturers are already producing in Vietnam such as Samsung Electronics with 10% localization as of last autumn, and Toyota Motor was 19-37%, depending on the car model. Such a delay in localization has caused these investors to import a large amount of components. This year is an important milestone for all the manufacturers and industrialists in Vietnam to update the industrial facts and global trends, upgrade the technology and exchange knowledge to gain the firmly competitive position in the region", said by Mr. Duangdej Yuaikwarmdee, Deputy Managing Director and General Manager Vietnam of Reed Tradex Co., Ltd.

 

Reed Tradex – an Asean’s leading exhibition organizer has set up a big chance for the event Vietnam Manufacturing Expo by scheduled it in this April to be able seize the golden time when TPP and AEC have taken full effects in the beginning of this year. Vietnam Manufacturing Expo 2016 focuses on machine tools for Mold & Die making and injection technologies for plastics manufacturing. To maximize the business integration and technology exchange, the organizer will bring up 200 brands from 20 countries to present their machine and equipment, including showing up their intention to expand business in Vietnam. This will be the chance for Vietnam industrialists to attend on-site seminar and forum presented by experts from the relevant industry associations, government representatives and the top leading companies, in order to get update more industrial facts and global trends.

 

Former Ford Vietnam General Director, Laurent Charpentiersaid that “To increase the localization, the role of supporting industry is extremely important, there is a necessity of quality spare parts manufacturers, parts supply and assembly businesses”. Vietnam Manufacturing Expo 2016 is one of thenotableevents for industrialists in Hanoi to have an objectively look on current market demand, as well as directly sharing the practical experience to contribute to the implementation of the essential strategies in the near future to improve production ability, as well as meet specifications request from foreign partners.

 

 “Vietnam Manufacturing Expo 2016” will be co-located with “Sheet Metalex Vietnam 2016” which is Vietnam’s only sheet metal fabrication technology and machinery exhibition on 06-08 April, 2016 at Hanoi International Center For Exhibition (I.C.E.), Hanoi, Vietnam. For more information at: www.vietnammanufacturingexpo.com