Vietnam Propels SMEs To Global Market Amid China-U.S. Trade War
The Vietnamese government has started encouraging small and medium enterprises (SMEs) to infiltrate global markets as the country has widely been recognized to be a big winner in the ongoing trade dispute between China and the United States.
According to Viet Nam News, Tuesday's workshop with the theme of "How to Become a Qualified Supplier to Foreign Firms" centered on pushing SMEs to attract foreign investments and foreign interest.
FF Linkage Director of the USAID LinkSME project in Vietnam, Frank Weland, noted during the workshop that the country should change the initial impression that Vietnamese SMEs are worth taking on as suppliers because of low labor costs.
"Locating for low labor cost is the wrong reason for Vietnam's economy - a race to the bottom," Weland argued. He added global firms are looking at other aspects of business, especially in terms of supplier deals.
Weland recommended that Vietnamese SMEs should begin participating in activities will improve the country's stand-in global value chains. Innovation and the ability to supply client needs are two major aspects that SMEs should look into.
There are other issues that Vietnam has yet to resolve such as inexperience in working with foreign partners, poor technological processes, and a lack in experienced workers who can offer service or performance that foreign clients demand.
Through the workshop, the Vietnamese government is expecting to see more SMEs getting involved in expos and other business activities that will help attract the attention of global companies in search of reliable suppliers.
The government is also hoping that SMEs will adopt the recommendations shared during the seminar so they can build trust with potential clients who have confidence in the country's production capacity.
Vietnam has repeatedly been dubbed as a "winner" in the ongoing trade war between China and the U.S. that saw companies moving to Vietnamese cities to escape tariff impositions from the world's largest economies.
Due to the apparent shift in supply chains ever since the trade war kicked off last year, Vietnam's economy gained almost eight percent, prompting the government to implement reforms to improve the country's business environment.
Despite high hopes for Vietnam's rise amid global trade tensions, the country refuses to be overconfident. According to VnExpress International, Deputy Prime Minister Pham Binh Minh said during the National Assembly meeting that the country is prepared to with strategic moves in case the Vietnamese winning streak dies down.
Minh said the trade war still has the power to bring down Vietnam's GDP by millions in five years. To curb potential damages to the economy, the government has prepared appropriate responses to boost monetary stability, business competitiveness, and inflation control.