AsemconnectVietnam - After 75 years of development, Vietnamese industry has achieved many important accomplishments, becoming a driving force for economic growth and gradually asserting its position in the global value chain.

Industrial competitiveness improved
Vietnam has risen to become one of the countries with an industrial sector belonging to the group of countries with a medium-high level of global competitiveness. The global competitiveness of Vietnam's industrial sector has increased by 16 ranks in 10 years, from position 58 in 2009 to position 42 in 2019 (according to UNIDO ranking), becoming the country with the fastest ranking increase among ASEAN countries, approaching the 5th position in the region (only 0.0015 points behind the Philippines) and getting closer to the group of the 4 most competitive countries in ASEAN.
During the past 10-year strategic period (2011-2020), the industry was the fastest-growing sector in the national economy, contributing approximately 30% to GDP and becoming the country's key export sector. This contributed to Vietnam's rise from 50th place (in 2010) to 22nd place (in 2019) among the world's largest exporting nations.
To date, Vietnam has developed several key industries such as: oil and gas exploration and processing; electronics, telecommunications, and information technology; metallurgy, iron and steel; cement and building materials; textiles, garments, and footwear; mechanical engineering, manufacturing, automobiles, and motorcycles, creating an important foundation for long-term growth and promoting the modernization and industrialization of the country.
Furthermore, the restructuring of the industrial sector, coupled with innovation in the growth model and improved labor productivity, has increasingly focused on the core of industrialization. The internal structure of the industrial sector has shifted positively. The proportion of the mining sector in GDP has continuously decreased (from 9.1% in 2010 to approximately 8.1% in 2016 and only 5.55% in 2020).
The processing and manufacturing industry has become the main driving force of growth for the entire industrial sector. In 2020, the processing and manufacturing industry played a key role in driving economic growth with a growth rate of 5.82%. Considering the period from 2011 to 2020, the manufacturing industry group has continuously expanded and accounts for the highest proportion of all industries, with its contribution to GDP increasing steadily over the years (from 13% in 2010 to 14.27% in 2016; 16.48% in 2019 and reaching approximately 16.7% in 2020).
Similarly, the supporting industries have also received attention and promotion, strengthening linkages, especially in Vietnam's key manufacturing sectors such as textiles, footwear, electronics, and agricultural processing... A supporting industrial ecosystem is beginning to form, and the localization rate is increasing.
Positive shift in product structure
According to the Ministry of Industry and Trade, the product structure has shifted positively, with a significant increase in the proportion of high-tech and medium-tech products in Vietnam, creating a basis for the formation of several large-scale private industrial groups capable of competing in the international market. The proportion of processed goods in total export value increased from 65% in 2016 to 85% in 2020; the proportion of high-tech product exports increased from 44.3% in 2016 to 49.8% in 2020.
A noteworthy milestone is that the UNIDO industrial competitiveness report has moved Vietnam from the group of "developing economies" to the group of "emerging industrial economies," demonstrating a significant improvement in industrial competitiveness.
Significantly, industry has become the sector with the largest contribution to the state budget, accounting for over 90% of the country's total export turnover, actively contributing to job creation, labor restructuring, increased labor productivity, and improved living standards.
The industrial structure has undergone positive changes, gradually reducing the proportion of resource-intensive and low-technology industries, while increasing the proportion of medium- and high-technology industries (the proportion of manufacturing in GDP increased from 13% in 2010 to 16.7% in 2020). Several large private industrial groups have been formed and developed with the potential to expand into regional and international markets.
Notably, the processing and manufacturing industry is also the main sector determining the growth rate of the entire industrial sector, creating the largest added value for the industrial sector and being the main driving force in the country's economic growth for many years, contributing to the successful implementation of socio-economic development nationwide. By 2025, with a share reaching 24.7% of GDP, the processing and manufacturing industry has excellently fulfilled its mission as the "backbone" of the economy. These achievements affirm Vietnam's capabilities on its journey to becoming a sustainably developed industrial nation.
Prioritizing foundation industries, aiming for long-term development
According to experts and managers, to develop industry and enhance competitiveness in the global market, a synchronized and unified system of solutions and policies is needed, from theory to practice, to mobilize resources and leverage the strengths of Vietnam's industries.
More fundamentally, to have a truly developed industrial sector that plays a key role in promoting economic growth, the Ministry of Industry and Trade needs a new approach and mindset regarding the model and policies of industrialization and modernization in Vietnam in the new context and conditions of the period up to 2030, with a vision to 2045. In particular, the industrialization and modernization policies should prioritize the development of foundation industries; encourage the harmonious/rational development of key industries and new industries; and be based on science, technology, innovation, and the technologies of the Fourth Industrial Revolution.
Simultaneously, industrialization and modernization policies need to expand from traditional mechanisms and policies such as credit incentives and tax exemptions to new mechanisms and policies such as budget support. The focus should be on developing criteria, conditions, and mechanisms to identify and strongly develop models of industry clusters, supporting industrial parks, and specialized industrial parks for certain foundational industries, based on the level of industrial concentration and connectivity along the production chain, to form an overall ecosystem for the development of foundational industries, thereby creating a ripple effect on related industries.
Furthermore, focusing on building new growth drivers for Vietnam's industry from a sustainable development perspective: Strengthening self-reliance and moving towards high self-sufficiency by capturing high value-added stages in the global production chain, coupled with resource conservation and environmental protection, is one of the important factors enabling Vietnam's industry to overcome existing challenges and risks, and continue to be the leading engine of economic development.
In addition, the Ministry of Industry and Trade will also propose to the Government the construction of large-scale industry clusters to attract investment and build industrial production chains; policies are needed to build large corporations to lead other industries. Alongside the development of foundational industries, it is also necessary to develop industries that produce raw materials for other industries, such as self-sufficient industries, mechanical engineering, chemicals, and materials industries.
CK
Source: VITIC/moit.gov.vn