Research on banking FOREGN TRADE

FOREGN TRADE UNIVERSITY

HO CHI MINH CITY

INTERNATIONAL ECONOMICS

INDIVIDUAL MID TERM ESSAY

VIETNAM’S PRODUCT CODE 8517 TELEPHONES SET;

INCLUDING TELEPHONES FOR CELLULAR NETWORKS

EXPORT INDUSTRY FROM 2001-2018 ANALYSIS

Lecturer Ms Tran Nguyen Chat

Class K57CLC3

Student Nguyen Tri Dat

Student ID 1801015184

2

3

Contents

I. INTRODUCTION ………………………………………………………………………………………………………………...5

II. OVERVIEW ………………………………………………………………………………………………………………………..6

III. VIETNAM’S TELEPPHONES INDUSTRY 2001 – 2018 ………………………………………………………………..9

IV. IMPLICATIONS ………………………………………………………………………………………………………………. 19

V. CONCLUSION ………………………………………………………………………………………………………………... 21

VI. REFERENCE …………………………………………………………………………………………………………………… 23

4

This page is intentionally left blank

5

I. INTRODUCTION

Vietnam has come a long way since the day of Doi Moi policy. The average annual GDP

growth is roughly 6.5 percent (2010 – 2018, The World Bank), increased to 7,1% in 2018

and currently the 21st top exporters out of 221 countries in the world with a total value

220 billion dollars. The country’s economic structure shifted from an agriculture-focused

to a more Industrialized approach has brought immediate and vast changes in both the

nation’s economy and social welfare. This simultaneously alters many industries and

business in the economy. One major shift in Vietnam’s industrial structure in the past

twenty years has been the rise of Electrical engineering and assembly line manufacturing

method, opening up an absurd potential for the country’s economy in many

Telecommunication fields. Among them is Telephone set, Including Telephones for

cellular networks… (HS code: 8517, full name: “Telephone Sets, Including Telephones

for Cellular Networks Or For Other Wireless Networks; Other Apparatus For The

Transmission Or Reception Of Voice, Images Or Other Data, Including Apparatus For

Communication In A Wired Or Wireless Networks (such As A Local Or Wide Area

Network), Other Than Transmission Or Reception Apparatus Of Heading), which is now

the second largest export industry of Vietnam, only behind Broadcasting Equipment

products. The purpose of this paper is to analyze the reasons for the rapid change in

Vietnam from an Agriculture country to now world top Telephones exporter in the world.

This paper refers to Vietnam’s import and export data for HS code 8517 product

available on INTRACEN trade map, combining information and data from previous

available report as well as related articles. The author will also provide implications from

indexes, figures and graphs, … which is not the absolute solution or the most practical

way to deal with many problems the country is facing but rather, as a guideline in hope

of it will contribute to the overall welfare of Vietnam.

6

II. OVERVIEW

Telephones set; including telephones for cellular network, … (Telephones) exporting

industry is currently one of the most important leading industry of Vietnam. Contribute

for over 15 billion of dollar of total exported value (6,8% share value), which is the

second highest value industry. According to the latest figures from the General Statistics

Office, for the whole year of 2019, export turnover was estimated at US $ 263.45 billion,

up 8.1% compared to 2018. Of the 6 items with export turnover of more than US $ 10

billion in 2019, phones and components are the largest export items with 51.8 billion

USD, accounting for 19.7% of total export turnover. Phone exports in 2019 also

increased by 5.3% over the previous year. Meanwhile, the electronics, computers and

components industry witnessed a growth of up to 20.4%, reaching a turnover of US $

35.6 billion.

In the opposite direction, electronics, computers and components were the major import

turnover with US $ 51.6 billion (accounting for 20.3% of total import turnover) and an

increase of 19.5% over the year. before. As for phones and spare parts, the turnover

reached 14.7 billion USD, down 7.9%.

However, data from the General Statistics Office also shows that the export proportion

of some key commodities still belongs to the foreign direct investment sector. In

particular, phones and components accounted for 95%; electronics, computers and

components accounted for 82.3%.

Although the market no longer observes the rapid change in Telephone exports, the

smartphone market in Vietnam is still attractive. Opportunities open for all phone brands,

especially Vietnamese brands. According to a research survey from GfK, in 2019,

Vietnam market consumes 1,2 – 1,4 million smartphones. The same figures can be seen

in a report from TechniAsia: for every 100 Vietnamese there were 145 cellphones in

used in 2017. The report also noted that “For a country whose population is just over 90

million, that amounts to more than 130 million mobile phones“. With a potential ever-

consuming market, Vietnam is among one of the most promising destinations for foreign

investors. Combine with the cheap and abundant labor workforce, Vietnam has been