Integration for small and medium enterprises: Confidence is important

Despite assessing the difficulties that Vietnamese small and medium-sized enterprises will face when integrating globally, economic experts still believe that Vietnamese enterprises have the ability to "play" in this playground.

According to statistics, currently only 36% of businesses participate in the global production network (including direct and indirect exports) compared to 60% of Malaysia and Thailand. Of these, only 21% of Vietnamese small and medium-sized enterprises participate in the global value chain, while this figure for Thailand is 30% and for Malaysia is 46%.

According to economic expert Pham Chi Lan, this number makes it less likely for Vietnamese small and medium-sized enterprises to benefit from the spillover effect of FDI through technology transfer, knowledge transfer and productivity improvement.

"We are lacking medium-sized enterprises and small and medium-sized enterprises lack economic efficiency of scale. Meanwhile, we are facing fierce competition when exporting to the US market, one of the largest markets in TPP... Not to mention the trade and technical barriers, the consumer protection requirements set by the US market are very high, but Vietnamese enterprises do not have enough technological, financial and administrative capacity to meet this requirement.

The US market is also considered a market with large import demand, requiring fast delivery times, so it also requires suppliers to have a supply scale to meet large, stable demand and competitive prices. On the other hand, our small and medium-sized enterprises do not have their own brands but are largely dependent on outsourcing," Ms. Pham Chi Lan analyzed.

Still knowing the difficulties that small and medium-sized enterprises are facing, Mr. Vo Tri Thanh, former Deputy Director of the Central Institute for Economic Research, said that Vietnam has never been able to "play" with the world with as much reform as it does now. Therefore, the important issue is still confidence.

"For example, when "playing" with the US through the Vietnam-US Trade Agreement (BTA), we were nervous and delayed after 1 year before signing the agreement. But after only 14 years, there is no miracle like the increase of Vietnam's exports to the US 30 times, including a significant contribution from small and medium-sized enterprises," Mr. Thanh cited.

Mr. Vo Tri Thanh said that the opportunities of TPP for businesses are many. Small and medium enterprises can participate in all fields such as textiles, footwear, furniture, seafood... service industries such as retail, distribution, entertainment, tourism or logistics.

However, to participate in these fields, Mr. Vo Tri Thanh said that small and medium-sized enterprises must connect with larger enterprises because these enterprises cannot do all the stages. The connection not only helps businesses do business, services, and support industries, but importantly, learn and improve.

Ms. Pham Chi Lan also said that TPP brings great opportunities and creates pressure for Vietnam to reform and develop, but whether or not to take advantage of it depends on the businesses themselves. "Don't worry about lack of resources and capacity. What is needed most is will and action," Ms. Pham Chi Lan emphasized./.