Vietnam Becomes World’s New Production Base

Vietnam is currently a "base" of mobile phone production for the world. Photo: Thanh Nien

Export of clothes, shoes, furniture

Vietnam's textile and garment industry has been in the top 3 of world exports. By 2021, Vietnam has surpassed Bangladesh to take the second place.

According to the World Trade Statistics Review 2021, released by the World Trade Organization (WTO), Vietnam's garment exports in 2020 decreased by 7%, while Bangladesh faced a 15% decrease due to the Covid-19 pandemic.

According to the World Footwear 2021, for the first time, Vietnam has accounted for over 10% of the global shoe market share in 2020, becoming the second largest exporter of this product in the world.

The story of Nike, a corporation specializing in sports products, also shows that the amount of leather and shoe production in Vietnam is increasing sharply, accounts for 51% of its global output.

This ratio of the company in China has dropped to 21% from 35% in 2006. Thus, Vietnam has officially surpassed China, becoming the main production base for this brand. Nike's rival Adidas is also moving in a similar direction, with 40% of footwear production being produced in Vietnam.

Vietnam's leather and footwear exports have risen to the second position in the world. Photo: Thanh Nien

Vietnam's wood products by the end of 2020 also surpassed Poland, Germany and Italy to rise to the position of the second exporting country in the world.

According to Nguyen Chanh Phuong, vice president and general secretary of Ho Chi Minh City Handicraft and Wood Industry Association, except for China in the top position, the next 3 positions are not too far away.

Therefore, the goal of Vietnam's wood industry is to surpass and maintain the second position. There are favorable conditions for the export of this product to increase.

"Made in Vietnam" mobile phones are being sold all over the world. Photo: Thanh Nien

Mobile phones, laptops for global export

In recent years, Vietnam has also emerged as a global production "base" for technology products such as mobile phones and laptops. Currently, more than 50% of Samsung's phone in the world is produced in Vietnam.

The trend of switching to manufacturing laptops and electronics in Southeast Asia and Vietnam particularly has increased sharply. At the end of 2020, the Nikkei Asia made a statement that by 2030, half of all laptops sold globally will be manufactured by Southeast Asian countries.

With many products from Samsung and Apple, Vietnam will attract a series of other technology projects in the near future. Together with the stable socio-economic situation, Vietnam will continue to become a more attractive attraction for many manufacturing industries, especially laptops and electronic technology," Do Khoa Tan, vice general secretary of the Vietnam Electronics Industries Association said.

Opportunities with shifting global capital flows

According to experts, Vietnam is gradually becoming a production "base" for many industries in the world, an important link in the global supply chain. This makes many foreign invested enterprises (FDI) want to set foot in Vietnam.

Within the first two months of this year, there were 183 foreign projects registered for new investment in Vietnam with a capital of US$631.8 million.

Phung Duc Tung, director of the Mekong Development Research Institute, said that after more than two years of the Covid-19, China still applies the "zero Covid" strategy. Therefore, the advantage of FDI attraction of this world factory has shown signs of decline.

Vietnam is not the only option in that shifting flow. However, with a favorable geographical position, next to China, and an international seaport system, Vietnam is one of the good choices for investors.

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