KUALA LUMPUR, May 15 -- Viet Nam has created little value added from exports (US$69 billion in 2019), that is equivalent to only one quarter of nominal value of exports of goods and services (US$260 billion), posing many strategic challenges to Viet Nam’s development. (US$1 = RM4.343)
This is according to the recently released study by the ASEAN-Japan Centre on Global Value Chains in ASEAN: Viet Nam.
Massive foreign direct investment (FDI), in particular export-processing FDI in Viet Nam means that the country has become a favoured destination for export-processing production.
Although gross exports of Viet Nam are growing, the contribution of domestic value added exports to the national economy is small, accounting for only 12 per cent of GDP, compared with the ASEAN average of 33 per cent.
The effects of FDI on the economy as well as exports depend on the value added structure of the Vietnamese economy, in which the secondary sector (manufacturing), in particular the industry of foods and beverages, exhibits a large multiplier effect.
Global value chains (GVCs) of Viet Nam indicate the extent to which the country is involved in world and regional production networks.
During the period of nearly three decades, the share of contribution of foreign countries to value added exports from Viet Nam fluctuated from 23 to 42 per cent before stabilising at 32 to 33 per cent.
There is a relationship between the increasing level of FDI and the growth of participation of Viet Nam in GVC, and both of these create benefits for the economy.
In order to capitalise on this, Viet Nam should improve its legal framework and administrative procedures to help the domestic sector tackle its current challenges, and keep track of the economic reforms under Doi Moi to attract FDI, along with promoting the development of high technology and modern infrastructure.
More details at https://www.asean.or.jp/en/centre-wide-info/gvc_database_paper11/
-- BERNAMA
No comments:
Post a Comment