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Some big industrial movers and shakers were present to make some big deals
Hanoi last week hosted its ever largest industrial exhibition organised by Thailand’s Reed Tradex Company, Hanoi Trade Promotion Centre and Japan External Trade Organisation.
Its three co-located industrial events were “Vietnam Manufacturing Expo 2011”, “Industrial Components & subcontracting Vietnam 2011” and “Vietnam-Japan Supporting Industries Exhibition” annually organised in the capital.
Thousands of foreign and local industrialists visited three co-located industrial events where industrialists found ways to develop supporting industries, one of the weaknesses of Vietnam’s industry development.
Vietnam is currently on the industrialisation and modernisation pathway and it targets to become an industrial country by 2020. But, supporting industry weakness are holding it back.
“The exhibition is a good opportunity for business executives to have a practical look about the role and status of supporting industries in Vietnam so that they can find the suitable solutions as well as policies to develop their business in Vietnam, especially in the context of market economy and international economic integration process,” said Deputy Minister of Industry and Trade Ho Thi Kim Thoa.
At the Vietnam Manufacturing Expo, for example, visitors found the machinery and technologies by 200 exhibitors from 20 countries who demonstrated how the visitors could upgrade the quality of the industrial parts and other products they produce.
The Industrial Components & Subcontracting Vietnam was a place for 60 Vietnamese part manufacturers exhibiting industrial parts they can produce to new buyers. Meanwhile, in the Supporting Industries Exhibition, 59 Japanese manufacturers came and looked for new subcontractors to produce for them, while 52 Vietnamese manufacturers were showcasing parts that they can produce to prospective buyers.
Chainarong Limpkittisin, managing director of Reed Tradex, said the exhibition helped 8,000 part-makers and manufacturing industrialists from across Vietnam to upgrade their production precision and products’ quality, to sell and source parts, and to expand businesses beyond the border.
The large volume of visitors, especially Vietnamese visitors, indicates that local manufacturers are more interested in the development of supporting industries.
In the process industrialisation and modernisation, supporting industries plays and important role, not only in contributing to attract foreign direct investment (FDI), but also promote the development of local small- and medium-sized companies to manufacture competitive products and development in the domestic market.
In recent years, Vietnam has been emerging as one of the most attractive destinations for FDI in the world. Though the newly committed FDI in some risky sectors like property and finance is declining in the country due to current global economic recession, foreign industrial manufacturers remain expressing interests to set up new facilities here.
Statistics from the Foreign Investment Agency, under the Ministry of Planning and Investment, showed Vietnam attracted $201.8 billion of committed FDI till now. Half of FDI commitment is in industrial manufacturing sector.
Japanese manufacturers, for example, are increasing investments in Vietnam like Honda, Toyota, Canon, Panasonic, Suzuki and Yamaha.
However, Japan External Trade Organisation executive vice president Takezo Yanagida said weak supporting industries in Vietnam were deterring Japanese investors from expanding manufacturing in the country.
Nguyen Van Suu, vice chairman of Hanoi People’s Committee, said Vietnam was moving towards the ASEAN Economic Community, so the increased investment capital flows and improved competitiveness were inevitable.
“Therefore, industries need to consolidate and to stay updated on new trends in modern machinery and technology solutions to enhance production capacity and products quality to meet the market demands,” he said.
To do that, an industrial exhibition like the ones held in Hanoi last week could be a good way.
“I believe that the co-location of such three exhibitions in Hanoi will be an effective bridge to network Vietnamese and international companies in supporting industries for direct meeting, trade transactions and long-term partnership,” said Thoa.
In the meantime, she added, the event helped Vietnamese companies to find stable output, on-site export and helped overseas manufacturers in Vietnam to improve the localisation rate and find reliable part manufacturers with high quality and reasonable price.
For Reed Tradex, 2011 is the fourth year it has been organised industrial exhibitions in Vietnam. The organiser announced to organise such events in this country every year.
Chainarong said Reed Tradex had been working with Vietnam’s government bodies and it was evident that the government highly-valued the importance of the supporting industries including the parts making sector. He added the government had been providing support that the parts makers needed to produce industrial parts whose quality lived up to the expectations of investors.
“To do so [developing supporting industries], new machinery and technologies are needed, new know-how is required, and new business networks need to be established and expanded. And so we organised Vietnam Manufacturing Expo with confidence that the event will be one piece of a jigsaw that will fill into help complete a picture of a vibrant parts making sector which is ready to push Vietnam’s manufacturing industries and economy forward,” said Chainarong.