Telephone export: Opportunities for support industry
The Ministry of Industry and Trade (MOIT) reported that in the first nine months of 2013, the export revenues of telephones and accessories reached US$15.1 billion, up 75.5 percent compared with the same period last year, much higher than the growth of total export revenue. In 2009, this category ranked only ninth among Vietnameseexports, but rose to fourth in 2010, second in 2011 and 2012 and to the leading position in the nine months of this year.
Chairman of Vietnam Electronic Industries Association Le Ngoc Son predicted that the export turnover of telephones and accessories could exceed the US$20 billion mark in 2013. The major import markets of telephones and components from Vietnam included the European Union (EU) with turnover reaching US$5.4 billion, up 71 percent compared to the same period last year and accounting for 40 percent of the total export value of telephones and accessories. In addition, the export turnoverfrom the United Arab Emirates also reached US$2.27 billion, an increase of 156 percent; while that from India reached US$642 million, an increase of 163 percent.
Luu Quang Khanh, Head of the Department of Service Economy under the Ministry of Planning and Investment said the increased export of Vietnamese telephones was mainly attributed to the production of Foreign Direct Investment sector (accounting for 99 percent).
Opportunities for the support industry
Despite the high export revenues from telephones and accessories, added value remained low as most of the materials are imported. Domestic electronic enterprises only contribute a small part in the total export value as they mainly process and assemble the products for foreign companies.
According to Deputy Director of Ministry of Industry and Trade’s Department of Heavy Industry Truong Thanh Hoai, in the short term, Vietnam’s electronics industry require practical policies and developed links between Vietnamesemanufacturers with FDI enterprises to boost the support industry development.
In reality, FDI enterprises also received supplies of electronic accessories fromVietnamese enterprises. General Director of Nokia Vietnam (Bac Ninh) Ivan Herd said his plant is using materials supplied by 10 domestic electronic suppliers around the country. This is a very good opportunity for Vietnamese electronic enterprises to exploit and develop its support industry.
| Professor, Dr Nguyen Mai, the Chairman of the Vietnam Association of Foreign Invested Enterprises “Vietnamese electronics enterprises should be more active in the joint venture or association to become satellite companies to the international electronics groups for sustainable growth”. |
The director of Vietnam Institute of Economics, Dr. Tran Dinh Thien said attracting large projects like what Samsung did will contribute to luring more small and medium-sized investors to Vietnam, making good influence on technological transfers of enterprises and the research and development (R&D) activities. The important thing is to develop support industry based on key projects like Samsung.
Le Ngoc Son also said Vietnam’s electronics enterprises should try to participate in supply chains of well-known groups to improve their production levels and master new technologies, targeting to make complete products with high localization rates and to become large scale high-tech enterprises to join in the global electronics supply chains
