Over the past days, escalating trade disputes between the US and China have impacted on the global trade activities. For domestic enterprises, in this context should take advantage of opportunities to expand export markets.
Opportunities and challenges to interweave
After the decision to impose 25% tax on $ 50 billion of imports from China, the new administration of President Donald Trump announced that it would apply a 10% tax on the size of goods worth 200 billion dollars, effective The tax rate will increase to 25% early next year. This escalation of trade tensions may have a direct and indirect impact on Vietnam. Some sectors of China affected by the tax rate of 10% is quite similar to the group of major exports of Vietnam to the US, so expected some sectors of Vietnam can benefit directly, in sectors such as wood, textiles, footwear ... are affected the earliest.
The investment flowing from China to South East Asia in the future will be an opportunity for Vietnam in general and Binh Duong in particular. In picture: Producing wood for export at Tuong Van Wood Co., Ltd (Bac Tan Uyen district). Photo: Xuan Thi
Huynh Quang Thanh, Chairman of Association of Woodworking Pacific, said the US tax both wooden goods of China is an opportunity for the timber industry Vietnam flourish, by furniture of China hard on the market American schools also synonymous with Vietnamese furniture have the opportunity to occupy market share that China leave. Vietnamese companies can take advantage of this opportunity to increase capacity by 30%, even those businesses that have conditions to invest in expanding production. Vietnam's wood exports are important in the international market because of its high quality, meeting the stringent requirements of the US market.
In addition, the export of materials and components from Vietnam to China could be affected if China's exports are weak. In addition, Vietnamese enterprises may face stiff competition if Chinese goods are dumped in Vietnam. In return, Vietnam could benefit if American businesses find alternative supply chains and US consumers use Vietnamese goods instead; More important is the influx of foreign investment from China into Vietnam to avoid taxation.
In addition, in recent years, the trend of investment shift from China to Southeast Asian countries, including Vietnam is gradually clear to take advantage of export opportunities and cheap labor. In addition, some US businesses investing in China also tend to shift production to other countries. It can be seen that in the past nine months China has a total new investment capital, increase and buy shares in Vietnam is 1.52 billion. Up to now, China has 2,006 valid projects with a total capital of nearly 12.7 billion US dollars, accounting for 3.8% of total foreign investment in our country are still valid, the country ranked 7/129 , territories invested in Vietnam. Meanwhile, the US is ranked 11th among countries and territories invested in Vietnam.
To take the opportunities
When pouring capital into Vietnam, the flow of investment capital from China usually chooses into the southern key economic region, of which Binh Duong capital is one of the preferred destinations. Binh Duong, with favorable geographic location, near Ho Chi Minh City and the policy of investment incentives, the most dynamic nationwide, has become an important investment attraction pole. According to the Office of the Provincial People's Committee, industrial production of the province in the past nine months continued to grow steadily and many businesses have signed contracts with partners to the first quarter 2019, orders increased 5-10% over the same period last year; Industry index in 9 months increased 9.37% over the same period last year, of which the processing industry increased 9.64%.
In the field of attracting investment, Binh Duong has a lot of prosperity. The province has held conferences, dialogues, business associations in the country and foreign investors. In the first nine months of 2018, Binh Duong attracted 39.353 trillion dong of business registration capital, an increase of 16.5 percent over the same period last year; of which 3,873 newly registered enterprises and 754 additional enterprises increased capital. FDI attraction also grew well at $ 1.189 billion, reaching 84.95% of the year plan. Up to now, Binh Duong has 3,430 FDI projects with a total registered capital of up to 31.29 billion USD, maintaining at the top of the country.
Not only maintaining high rankings in the FDI attraction chart of the country, Binh Duong also attracts FDI capital into the processing industry, high technology content, labor-intensive. Oriented province. The sectors that attract the most FDI are the electronics, metalworking, machinery and equipment industries. Especially, many projects have invested in auxiliary industries that Vietnam in general and Binh Duong In particular, it is lacking and weak. Thus, if the flow of investment from China moves to Vietnam as expected, Binh Duong will really become a preferred destination of investors.
Tran Thanh Liem, Deputy Secretary of the Provincial Party Committee, Chairman of the provincial People's Committee said that in the coming time, the province will continue to train Improve the investment environment, improve the competitiveness and promote support for the development of enterprises in the area. Specifically, the province will focus resources to invest in improving the system of socio-economic infrastructure such as transportation, water supply, electricity, environmental treatment ... as well as planning the expansion of industrial zones , creating clean land fund to attract investment. One of the key tasks is that the province will strengthen the dialogue, timely solve problems, obstacles ... of investors, thereby reducing costs for enterprises, enhance the competitiveness of Enterprises in the area.
Reported by Khanh Vinh – Translated by Vi Bao
