The COVID-19 pandemic has been disrupting the operations of the global supply chain, making it difficult for businesses to model investment - trading activities and assess risks. Both of the supply chains in many countries including Vietnam and the global economy have been seriously affected.
However, Vietnam has stabilized its economy and ensured social security because of controlling the pandemic well, compared to many other countries. Also, Vietnam is gradually transitioning from the crisis response phase to the recovery one.
In this context, the shift of the global supply chain and how to better prepare for the new supply chain are top concerns of businesses. This can be seen as a key to overcome challenges and seize opportunities for investment, manufacturing, and business in the coming time.
The COVID-19 pandemic not only tests the health and endurance of businesses but also motivates them to face challenges and go ahead.
Currently, the investment flows go to different industries and sectors. However, the supply chains and value chains are changed by factors including geopolitics, markets, especially business partners.
Therefore, not only businesses but countries need to meet market needs in terms of core competencies and technology. In Vietnam, there are full conditions of competitive advantages and international network, allowing business for capturing opportunities in the new situation.
Recent surveys show that if manufacturing factories move out of China, they are set to move to Southeast Asia, Mexico, and the US. However, Vietnam faces fierce competition in the Southeast Asia region because besides establishing industrial parks and processing zones to welcome investment capital, the requirements for infrastructure and traffic need to be met.
However, in export markets, the strength of Vietnamese brands has not been clearly shown. Therefore, businesses are forced to continuously strive for improving their ability and complying with laws, standards, and market requirements. Also, businesses must know how to choose a reputable partner, thus enhancing the business network.
Supporting businesses to make the most of the new global supply chain
According to Director of the Investment and Trade Promotion Center of Ho Chi Minh City (ITPC), Mr. Nguyen Huu Tin, ITPC has been actively supported the business community to make use of the FTAs as well as enhance Vietnam's participation in global supply chains through trade and investment promotion activities.
During the COVID-19 pandemic, many direct support activities were canceled. Instead, ITPC quickly turned to online support to help businesses update market information and seek customers.
Many programs to disseminate knowledge about FTAs, especially the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and EU - Vietnam Free Trade Agreement (EVFTA) are frequently organized in various formats to help businesses deeply access and take advantage of benefits in exports.
In the coming time, ITPC will continue to deploy specific solutions to support businesses to improve their competitiveness in the international integration process.
It is forecasted that many investors will continue to shift their investment to Southeast Asia, especially Vietnam in the period 2020-2021.
Depending on the industry, sector, and scale, enterprises can choose an investment, production, and business strategy that suits the market trend, so they can take benefits from the shift of the global supply chain.
Multi-sector enterprises need to maximize operating costs and corporate management costs, make use of vertical integration to allocate resources reasonably.
Each enterprise needs to focus on its strength as well as ensure cash flow management and market risk. When enterprises have sufficient practical capacity, they can seize business opportunities, including multi-sector activities and fields.
Regarding the assessment of the state's role in promoting new opportunities and supporting business, some experts believe that it is very important to adjust and issue appropriate policy mechanisms. But the more important thing is having quick and effective execution solutions.
In particular, ministries and local authorities need to promote the Government's support packages to businesses to empower them to overcome difficulties in innovation, technology application, product value increase, human resource training, etc.
On the other hand, the Government, ministries, and local authorities not only have a role of orientation but also stand by businesses for active and mutual assistance in the business community.
Compiled by VietnamCredit