Vietnam says No to low value added manufacturing

[VALKRYIE]

Local authorities say no to more garment projects

Last update: 17:00 | 10/03/2015

VietNamNet Bridge – Foreign-invested textile and garment projects are no longer welcomed in many provinces in Vietnam because the gains they bring are smaller than the losses.

Nam Dinh provincial authorities reported that the locality has licensed foreign-invested 32 textile and garment projects. Of the four Chinese-invested projects licensed recently, two are in textile and dyeing, registered by Thien Nam Sunrise and Yulun Vietnam.

Deputy director of the Nam Dinh provincial Planning and Investment Department, Do Ngoc Hoa, said the other Chinese enterprises, Luenthai and Sanshui Jialida, teaming up with Vietnamese Vinatex, are moving ahead with a $400 million project on developing Rang Dong, an industrial park reserved for textile and garment companies.

However, while textile and garment projects are welcomed in Nam Dinh, they are being turned away in other provinces.

Ba Ria – Vung Tau, Dong Nai and Binh Duong provinces in the south and Hai Duong province in the north have been restricting projects in the field.

Some sources said other provinces are considering adding textile and garment to the list of conditional business fields.

Bo Ngoc Thu, director of the Dong Nai provincial Planning and Investment Department, said textile and garment projects would only be licensed if they are located in industrial zones and the investors pledge to satisfy requirements on waste water treatment.

Meanwhile, Mai Hung Dung, director of Binh Duong Planning and Investment Department, said there is no textile and dyeing factory in Binh Duong. There are only garment factories.

“The added value that textile and garment projects can bring to the locality is smaller than the losses they cause to the environment,” Dung noted.

Hai Duong is the latest province which has “reconsidered” textile and garment projects.

The provincial authorities have decided to temporarily stopped trying to attract foreign direct investment to six business fields, including textiles and garments.

Meanwhile, the provincial authorities have called for investments in 41 projects in important business fields. These include six projects in industries and construction, two in transport services and seven in healthcare and education.

An analyst noted that Vietnam has indeed become choosier when licensing foreign-invested projects.

There is a growing tendency for rich provinces to say ‘no’ to projects in labor- intensive and low-added value industries like textiles and garments.

He said foreign investors were rushing to set up textile and garment factories in Vietnam in anticipation of free trade agreements of which Vietnam is a member.

Pham Chi Lan, a renowned economist, said high levels of investment in textile and garment factories would lead to oversupply and negative consequences.

 

[Raphael]

A country with 1.9K USD GDP/capita cannot be so choosy and must start from the bottom. This attitude reminds me of African-Americans who go on welfare instead of working, because they believe they are all entitled to being high paid rap stars or basketball players, but can only get jobs as burger flippers.

There is a huge price to pay for being delusional.

 

[dragonrider1984]

so, Vietnam is so first world country

 

[Kiss_of_the_Dragon]

A country with 1.9K USD GDP/capita cannot be so choosy and must start from the bottom. This attitude reminds me of African-Americans who go on welfare instead of working, because they believe they are all entitled to being high paid rap stars or basketball players, but can only get jobs as burger flippers.

There is a huge price to pay for being delusional.

Man you crack me up

 

[jhungary]

i dont understand what is the rift with Chinese member here, the article already said the gain of investing in textile is smaller than the lost

That mean the business is saturated and can no longer expanded, so naturally they would have to turn away further investment in such sector.

It does not matter if vietnam is first world or third world, when a business cannot make any profits by saturated market, they should allow no more investment in it, as they would just further slim down the market share and flush the market with supply and harm the market

 

[Kiss_of_the_Dragon]

i dont understand what is the rift with Chinese member here, the article already said the gain of investing in textile is smaller than the lost

That mean the business is saturated and can no longer expanded, so naturally they would have to turn away further investment in such sector.

It does not matter if vietnam is first world or third world, when a business cannot make any profits by saturated market, they should allow no more investment in it, as they would just further slim down the market share and flush the market with supply and harm the market

Have you ever read the title of this thread to start with???

 

[jhungary]

Have you ever read the title of this thread to start with???

I Did, but did you actually bother to read the actual article?

Mate, the title can read Vietnam say no to Chinese investment for all I care, I read whats actually written, not just laugh after reading the first line

 

[cirr]

So we have a new Vietnamese（most probably from the south）disguising himself as a Canadian。

A proud immigrant？

 

[NiceGuy]

i dont understand what is the rift with Chinese member here, the article already said the gain of investing in textile is smaller than the lost

That mean the business is saturated and can no longer expanded, so naturally they would have to turn away further investment in such sector.

It does not matter if vietnam is first world or third world, when a business cannot make any profits by saturated market, they should allow no more investment in it, as they would just further slim down the market share and flush the market with supply and harm the market

Right, the TPP deal is coming, and lots of Chinese beg for setting up their factories in VN, so their garments can export to other TPP nations. Unlucky for them, we just say : No !

Lots of Chinese bosses will go broke soon coz No one will buy their garments in near future

 

[BoQ77]

i dont understand what is the rift with Chinese member here, the article already said the gain of investing in textile is smaller than the los
That mean the business is saturated and no longer expanded, so naturally they would have to turn away further investment in such sector.

It does not matter if vietnam is first world or third world, when a business cannot make any profits by saturated market, they should allow no more investment in it, as they would just further slim down the market share and flush the market with supply and harm the market

As article: rich provinces reject textile and dyeing. It's logical.
Binh Duong, Hai Duong ... want to utilize their infrastructure investment for more value added like high tech, precision engineering... and they have been attracting many big investment to their IP, IZ

Nam Dinh is a poor province, they still want to earn something for their people by garment, textile ... because so far there's not many investment to their province.

Anyway, the title is an exact conclusion of the article.

So we have a new Vietnamese（most probably from the south）disguising himself as a Canadian。

A proud immigrant？

There're many oversea Vietnamese people. I myself has relatives in USA and Canada too.

 

[Kiss_of_the_Dragon]

I Did, but did you actually bother to read the actual article?

Mate, the title can read Vietnam say no to Chinese investment for all I care, I read whats actually written, not just laugh after reading the first line

Sorry the text size of the article is just too small compare to the Title , I think it's obvious that the OP want to get attention to the title...

 

[BoQ77]

i dont understand what is the rift with Chinese member here, the article already said the gain of investing in textile is smaller than the lost

That mean the business is saturated and can no longer expanded, so naturally they would have to turn away further investment in such sector.

It does not matter if vietnam is first world or third world, when a business cannot make any profits by saturated market, they should allow no more investment in it, as they would just further slim down the market share and flush the market with supply and harm the market

I guess most of them read the title only.

 

[AndrewJin]

Low-end and low value-added factories are moving to Southeast Asia and South Asia for cheaper labour force compared to China. Then from now on Vietnam's target is to make high value added items like hybrid bus, optic fibre and high-end steel?

 

[BoQ77]

Low-end and low value-added factories are moving to Southeast Asia and South Asia for cheaper labour force compared to China. Then from now on Vietnam's target is to make high value added items like hybrid bus, optic fibre and high-end steel?

andrewjin: you are changing.
But yes, you're right : Vietnam target to build aircraft components, microprocessors ...
beside garment, footwear, agriculture products.

Undeniable, to catch up TPP benefits, many Chinese manufacturers are moving their yarns, textile production from China to Vietnam. They aren't alone, but Korea, Taiwan ...

 

[areal]

In fact, Vietnam does not have so many choice to determine which kind of investment is what it needs.
Any industrial sate in modern times, must experience an era of intensive financial support, either from the external or internal resources. Unfortunately, Vietnam gets zero, or even worse, negative for this record, as it keeps a very long time of trade deficit, year after a year, with a number of dozens of billion US$, not end in sight.
Chairman Mao asked God when China will finish the industrialization, the reply is 100 years, Chairman Mao cried, I am sorry I cannot see it done.
Uncle Hu also asked when Vietnam will finished the industrialization, God cried, I am sorry I cannot see it.