Nghe An Enterprises and the Issue of International Integration

Nguyen Van Nam (Deputy Director of NAPC) DNUM_BBZBAZCACB 07:32

(Baonghean) - Vietnam's participation in FTAs, especially FTAs, has significantly contributed to the country's international position being raised; especially in integration, economic development, and implementation of the foreign policy of multilateralization and diversification. Besides the advantages, Vietnamese enterprises in general and Nghe An enterprises in particular need to prepare themselves to face difficulties and challenges when the FTAs ​​come into effect.

Currently, Vietnam has signed 13 Free Trade Agreements (FTA) and is negotiating 3 FTAs. Participation in FTAs ​​has contributed to maintaining a high growth rate of 6-7%/year for our country's economy, the macro economy is increasingly stable; inflation is controlled, and major balances are ensured.

The FTAs ​​that Vietnam participates in cover most continents with nearly 60 economies whose total GDP accounts for nearly 90% of the world's GDP. This is a great opportunity for businesses.

Vietnam's participation in FTAs, especially FTAs ​​(Free Trade Areas), CPTPP (Comprehensive and Progressive Agreement for Trans-Pacific Partnership), EVFTA (Vietnam - EU Free Trade Agreement) is very timely, in line with the development trend and foreign policy of multilateralization and diversification; enhancing the intertwining of interests in relations with partners, gaining support from partner countries, and at the same time enhancing Vietnam's prestige in the international arena, Vietnam's international position is clearly raised.

Trung tâm Xúc tiến Đầu tư Thương mại và Du lịch Nghệ An làm việc với tỉnh Tuyên Quang về phát triển du lịch và khởi nghiệp.
Nghe An Investment, Trade and Tourism Promotion Center works with Tuyen Quang province on tourism development and startups. Photo: PV

Participation in and implementation of FTAs ​​has contributed to promoting export growth.diversify export markets, avoiding dependence on a traditional market. Creating more jobs, increasing income, improving people's lives. Easy access to high-quality goods and services from partner countries. Creating motivation to improve the quality of many agricultural, processing and high-tech products. The culture of international economic integration has also developed. Contributing to helping Vietnam perfect its institutions and legal framework to access international standards and practices, and reform administrative procedures.

Besides the advantages, Vietnamese enterprises in general and Nghe An enterprises in particular need to prepare themselves to face difficulties and challenges when FTAs ​​come into effect, including:
It is necessary to be ready to respond, set up trade defense measures and resolve economic, investment and international trade disputes that may arise...
More efforts are needed to build a synchronous system of policies and laws compatible with international treaties, shorten the gap with developed countries and become an attractive country for international investors, a safe destination for all global citizens.
It is necessary to increase the added value content in the global value chain, this is one of the requirements to improve the capacity of domestic enterprises. In the orientation of attracting foreign investment, it must be affirmed that, up to this point, our country has the right to choose and prioritize environmentally friendly projects with modern technology.

Dây chuyển sản xuất cá hộp hiện đại tại nhà máy Royal Foods (KCN Nam Cấm). Ảnh: Lâm Tùng
Modern canned fish production line at Royal Foods Factory (Nam Cam Industrial Park). Photo: Lam Tung

Even in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), Vietnam also faces many challenges. To be fair, the requirements for environmental commitments set forth in the CPTPP are very high compared to Vietnam's ability to meet them. This poses many challenges for Vietnam in terms of compliance and implementation of commitments. Specifically, Vietnam's environmental legal system is not yet consistent, does not meet the requirements of sustainable development and is not truly adapted to the environmental commitments in the CPTPP.

By the end of 2020, Nghe An had 13,220 operating enterprises, ranking 10th in the country. However, 98% of Nghe An enterprises are small and micro-sized enterprises, lacking good business management personnel, technical workers, low competitiveness and no strong brands capable of competing in the market. There are not many large-scale production and business enterprises, leading to the development of other enterprises. The proportion of enterprises operating in the manufacturing sector is still low,
There are 13,107 non-state enterprises in Nghe An, accounting for 99.14%. There are 63 state enterprises, accounting for 0.48%. There are 50 foreign-invested enterprises, accounting for 0.38%.

Đồ họa: Lâm Tùng
Chart of enterprise capitalization scale. Graphics: Lam Tung

In terms of industry: Service is the sector with the largest number of operating enterprises, accounting for 60.25% of the total number of enterprises. Enterprises operating in the industrial - construction sector account for 35.99%. Enterprises operating in the agricultural sector account for only 3.76%.

Regarding contributions, in 2016, revenue from the business sector reached 7,431 billion VND, accounting for 67.2% of total revenue in the area; in 2020, the corresponding figure was 10,501 billion VND. New job creation each year from the business sector increased from 7,846 workers in 2016 to 10,412 workers in 2020.
Export markets are expanding, and the number of enterprises participating in exports is increasing. From 74 countries and territories in 2016 to 120 countries and territories in 2020. The number of enterprises participating in exports: From 129 enterprises in 2016 to 200 enterprises in 2020.

Nghe An strives to have about 30,000 enterprises by 2025, of which 20,000 are operating. On average, in the period of 2021 - 2025, the growth rate of the number of operating enterprises will reach about 8% - 9%/year; the proportion of medium and large-sized enterprises will increase to about 4% - 6% of the total number of enterprises by 2025. Nghe An aims to develop enterprises operating in industries and fields with advantages in tourism, trade, logistics, high-quality education and training, specialized healthcare, processing and manufacturing industry, supporting industry, biotechnology, clean energy, renewable energy, digital products; enterprises in the fields of supporting industry development, green industry, energy saving, environmental friendliness, high-tech agriculture and large-scale production.

Xuất khẩu hàng hóa ở cảng Cửa Lò. Ảnh: Trân Châu
Exporting goods at Cua Lo port. Photo: Tran Chau

To develop Nghe An province's businesses in the coming time, it is necessary to implement well the following solutions:

The first:There are policies to support the formation and development of supply chains, first of all the supply chains of agricultural products and essential foods, promote chain linkages, strengthen linkages between manufacturing enterprises and distribution and retail enterprises. Attract technology enterprises, develop technology trading floors, build technology consulting organizations... Support the development of science and technology enterprises, innovative startups, information technology enterprises. Promote the development of an innovative startup ecosystem:
Monday:Perfecting mechanisms and policies to support innovative startups to improve their capacity and develop markets; attracting resources, experts, and investors. Forming a network of experts, consultants, and coaches for innovative startups. Continuing to train and foster management skills for entrepreneurs on each topic, creating conditions for the formation of entrepreneurs with capacity, professional ethics, and responsibility to the community and society.
Tuesday:Continue to effectively implement the policies to support enterprises that have been issued; at the same time, review and promptly advise on amending mechanisms and policies that are no longer suitable, build effective mechanisms and policies in each industry and field to create a favorable legal environment for enterprises to operate; policies to support investment, training of highly skilled workers, application of high science and technology, market expansion and development...
Wednesday:Support the provision of information on investment, trade and tourism promotion; market forecasting to improve the ability to access domestic and foreign markets. Organize well the work of information and market forecasting for businesses, organize marketing consulting services to help businesses grasp investment and business opportunities. Create conditions for businesses to access, survey, find partners, exploit domestic and foreign markets for effective cooperation, and have the ability to dominate the market.


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