What's Happening?
Vietnam's manufacturing industry is focusing on enhancing its position in global value chains amidst shifting supply chains and tariff uncertainties. At the M-TALKS 2025 forum, Truong Thi Chi Binh, Vice President of the Vietnam Association for Supporting Industries, highlighted Vietnam's potential as a reliable manufacturing hub despite political shifts in the U.S. The government is implementing strategies such as monitoring product origins and imposing anti-dumping duties to strengthen trade relations. Experts at the forum emphasized the need for Vietnam to transition from assembly to original equipment manufacturing (OEM) and eventually to original design manufacturing (ODM) and original brand manufacturing (OBM) capabilities. This transition is crucial for Vietnamese firms to gain a stronger voice in the supply chain and attract major buyers.
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Why It's Important?
The strategic shift in Vietnam's manufacturing sector is significant for its economic growth and global trade positioning. By advancing to OEM and ODM capabilities, Vietnam can increase its competitiveness and attract foreign direct investment, which reached nearly $12 billion in the first half of 2025. This development could lead to increased export orders and stable new orders, as indicated by recent surveys. The move towards higher manufacturing capabilities also presents opportunities for Vietnamese firms to collaborate with international partners, potentially relocating production to Vietnam. However, the transition poses challenges, including the need for improved R&D, customer insight, and meeting international standards.
What's Next?
Vietnamese firms are expected to focus on building capabilities in research and development, customer service, and market understanding to meet international demands. The government will likely continue to adjust trade strategies to support this transition. As Vietnam aims to enhance its manufacturing capabilities, it may attract more foreign investment and partnerships, further integrating into global supply chains. Companies will need to address challenges such as certification requirements and detailed cost breakdowns to compete with regional competitors like Malaysia and Thailand.
Beyond the Headlines
The push for higher manufacturing capabilities in Vietnam could lead to long-term shifts in the global manufacturing landscape. As Vietnam strengthens its position, it may influence regional trade dynamics and contribute to the diversification of global supply chains. This development also raises ethical considerations regarding labor practices and environmental impacts, as increased manufacturing activities could affect local communities and ecosystems.
