Illustrative photo (Photo: VNA)

Domestic enterprises are suggested taking advantage of global supply chain shifts as Vietnam is emerging as an attractive investment destination for global investors.

According to experts, the trend of placing supply sources closer to consumer markets to minimise risks is the safest pathway to avoid interruptions. Many multinational corporations are diversifying their supply sources in many markets that Vietnam's supporting products are also targeting.

Phung Anh Tuan, Deputy Director of Manutronic Vietnam JSC, said that the global supply chain shifts bring his company and other Vietnamese electronics businesses opportunities to participate in the global supply chain, expand production and business activities, and create more jobs.

However, the shifts pose challenges for domestic supporting industries as they must meet high requirements and standards of partners.

To meet the requirements, Vietnam needs a workforce with the capacity to obtain scientific and technological transfers to Vietnam.

Vice Chairwoman and Secretary General of the Vietnam Association of Supporting Industries (VASI) Truong Thi Chi Binh said that Vietnamese enterprises in the manufacturing sector are mostly small and medium-sized ones that supply components and spare parts for the automotive, electronics, and motorcycle industries.

They are well aware of the regulations and requirements of the supply chains regarding quality and delivery time. However, producing components for high-tech products such as automobiles or aeroplanes is much more challenging. For the aviation industry, Binh said, some Vietnamese companies can produce separate small components for lower-tier suppliers of Boeing, but it is highly technical to be a supplier for a global aviation corporation like Boeing.

To become a chain of the global aviation industry in general, and Boeing in particular, countries need to have long-term preparation, she said, taking the example of India and Malaysia who started building strategies on developing the aerospace industry 30 years ago, from training engineers to researching technology trends.

Nguyen Thi Van Anh from Systech Trading and Technology Joint Stock Company said Vietnam is attracting an influx of foreign direct investment, creating opportunities for domestic enterprises to become suppliers of the world's major groups. However, localisation rates remain low, only around 30-40%, demonstrating significant challenges ahead for the supporting industry.

Nguyen Hoan Vu, general director of KORI Beauty said that to participate more deeply in global supply chains, Vietnamese businesses need to drastically change their thinking to meet client demand.

Enterprises should invest 10-20% of resources in research and development to be able to produce products with high technological content, he said. They should also apply international standards to improve professionalism and build trust.

He suggested that they are urged to adhere to internationally recognised management tools such as ISO9001 and ISO14001 to enhance professionalism and build trust with large foreign corporations./.