The Hanoitimes - On June 16, the midterm Vietnam Business Forum (VBF) 2017 with themes “Strengthening the linkage between FDI and domestic businesses in the new global context” kicks off in Hanoi.
The event was jointly held by the Vietnam Business Forum, the International Finance Corporation, the Ministry of Planning and Investment, and the World Bank in Viet Nam.
Midterm Vietnam Business Forum 2017 kicks off.
The forum offered a venue for foreign direct investment (FDI) and local enterprises to get connected, contributing to sustainable development and improving the quality of the national economy.
Participants discussed solutions to help small-and medium-sized enterprises (SMEs) connect with FDI enterprises and join regional and international production networks towards eliminating national boundaries in production.
According to Chairman of the Vietnam Chamber of Commerce and Industry (VCCI) and Chairman of VBF Vu Tien Loc, there has been a poor linkage between foreign and domestic investors while the knock-on effect in terms of technology and labour productivity from foreign firms on Vietnamese firms remains limited.
In addition, according to a survey conducted by VCCI, the proportion of domestic businesses supplying commodities and services for FDI enterprises is pretty low. The Provincial Competitiveness Index (PCI) report in 2016 showed that only 14 percent of private businesses have customers that are FDI enterprises operating in Vietnam.
Less than 27 percent of FDI firms' input materials were purchased from Vietnamese partners while a substantial amount was bought from other FDI companies. High-tech FDI enterprises tend to import input materials from their homeland.
The real situation was attributed to puny marketing policies, inefficient industry support programmes and domestic firms’ failure to provide supplies that meet standards in production management and quality of from FDI enterprises. According to Chairman of VCCI, improving the qualifications of human resources is the key to promoting FDI businesses’ effects on domestic enterprises. Vietnam needs to mobilise all resources to better competitive capacity of private enterprises and the Government should realise policies to bolster the supporting industry.
Accordingly, this year VBF has received nearly 1,000 suggestions from businesses and associations sent to the Government and administrative agencies. The forum includes four sessions, focusing on employment, development of the support industry, investment into infrastructure, the fourth industrial revolution, or industry 4.0, free trade agreements, elimination of non-tariff barriers, attracting investment from the private sector and improvement of the effectiveness of law enforcement.