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FDI enterprises dominate export turnover

​For the first six months of 2017, Dong Nai's export turnover reached over US $ 8 billion, an increase of more than 12% over the same period last year, but high growth was mainly recorded in the sector of FDI enterprises with over 7 billion. FDI enterprises now export to 160 countries in the world.


​In fact, most FDI enterprises export goods directly to overseas markets. Domestic enterprises are mostly small and medium-sized, most of which are incapable of direct exports but through intermediate agencies.

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 Sowell Vietnam Co., Ltd. in Nhon Trach Industrial Zone 3 (Nhon Trach District) has export markets in many countries in the world.
 
* Grow more strongly in various aspects

In Dong Nai, FDI enterprises which are from 43 countries and territories account for a large portion of exports. Dong Nai's export products are also diverse with more than 50 items, including key export items such as: footwear, textile, textile fibers, wood products, machinery and equipment, spare parts, computers, electronic products and components, plastic products ... The markets that record large turnover include the United States, Japan, Korea, China and Europe. Exports in the recent years have encountered a lot of obstacles, but Dong Nai still retains its high growth rate and is one of the provinces that have large export turnover thanks to the contribution of big FDI companies.

Mr. Nguyen Tuan Anh, Head of Import-Export Department of Vietnam Precision Industry joint stock company (100% Taiwanese capital, in Ho Nai Industrial Zone, Trang Bom district), said: "The company's products have been directly exported to more than 10 countries in the world and we continue to expand our export market to other countries. The company has continually invested in machinery and applied new technology, producing many quality machinery products, so we have gain customers’ trust and received more and more orders. "At present, the enterprise has opened a new factory in Giang Dien Industrial Zone (Trang Bom district) in order to handle major export orders. According to Mr. Tuan Anh, FDI enterprises are much stronger to meet the requirements from the most demanding customers compared with domestic enterprises in the industry because of abundant capital, modern machinery lines, good factories and highly skilled laborers. As a result, the company's export markets are constantly expanding.

Mr. Le Van Loc, Deputy Director of the Department of Industry and Trade, commented: "FDI enterprises make a great contribution to the province's exports. The reason for exports of FDI enterprises are higher than domestic ones because they are stronger in many fields, such as: capital, technology, branding, skilled labor, trade promotion, linkage ... Therefore, their export growth rate is twice as high as domestic ones. "

The majority of FDI enterprises operating in the industrial manufacturing sector are investing in industrial zones of the province to meet the standards of factory, production line, environment and labor and meet the increasingly stringent requirements of foreign partners, so their export markets are more stable and advantageous than domestic enterprises.

* Lose the completion due to weak linkage

At present, about 80% of domestic enterprises in Dong Nai are of small and medium size with limited capital sources, weak brand building, small factories and outdated production machinery that cannot meet big orders, which are the factors that lead to low export growth rate.

Mr. Nguyen Thanh Nhan, owner of Thanh Nhan Wood Handicraft Facility (Binh Minh commune, Trang Bom district), said: "Our facility received many large orders from the United States, Germany and France, but we have refused because we are yet to meet their requirements. Previously, we have tried many times to find to cooperate with other businesses in the same field to handle big orders but we have failed to." According to Nhan, cooperating with enterprises and manufacturing facilities in the same field is very difficult. Most domestic firms in the same field often mind their own business and compete each other unfairly, which leads to their failure to grow.

Mr. Chau Minh Nguyen, General Secretary of the Dong Nai Association of Enterprises, said: "Domestic enterprises are mostly of small and micro size, which are less likely to make direct export to foreign markets, most of them must go through a third party in another country; therefore, their product prices are pumped up, which lead to their low competitiveness. Because of being dependent on intermediary agencies, it is very difficult to expand new markets. What makes small businesses in the country difficult to grow is the lack of linkage." Mr. Nguyen added that many domestic enterprises, after being supported by the province to promote trade and receiving direct export orders in large quantities, had to refuse because they were unable to meet their customers’ demands. However, when the association proposed that businesses in the same field should cooperate with each other, very few people expressed their interest in the idea, while FDI enterprises are good at this. For example, Korean, Japanese and Taiwanese enterprises, after investing in Dong Nai province, have jointly introduced raw material suppliers and business of the same fields to invest in the province to support each other in manufacturing activities. Therefore, businesses in the same field grow together, easily capable of handling the large orders. Upon receiving large orders, businesses can share them with each other to ensure delivery progress. As a result, they serve more customers and the market is expanding.

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