Vietnam surpasses Bangladesh in RMG export

[Indos]

However, when the price of Coke/Pepsi (12 oz small bottle) is 8,232 Rp in Indonesia, the price in dollar is $1.81 almost the same in other countries. So, even though the term is Rupiah in Indonesia, it is something like Paisa in Pakistan or Bangladesh. Its 100 Rupiah is the lowest value coin. Please refer to the wiki citation below:

"The current rupiah consists of coins from 100 rupiah up to 1000 rupiah (1 rupiah coins are officially legal tender, but are effectively worthless and are not circulated) and banknotes of 1000 rupiah up to 100,000 rupiah".

You are right, but I just need to give more additional information. Rupiah is traded freely in market so Indonesia never try to devalue Rupiah to gain export boost, the Rupiah before Asian Financial Crisis is traded at 1 Dollar = 2.500 Rupiah. Indonesian central bank try to control Rupiah using market mechanism and Rupiah was traded at 1 Dollar =16.000 Rupiah at the peak of our Financial Crisis 1997-2000.

 

[bluesky]

That is a misunderstanding.
Vietnam’s labor cost is 1/2 of China not 1/5. If we are just 1/5 of the cost, China manufacturing has no chance against Vietnam in making products.
The long term trend is clear: China delivers raw materials and resources while we make it to finished goods.
Second, $1 is 23.208 VND (15, August 2019). Now $1 is 23.174 VND (14, August 2020). That means USD is less worth.

No, the factory worker salary remains about $230 per month in Vietnam. In comparison the factory wage in China is more than $700. So, it is more than three times in China and it will keep on increasing as China moves towards more value-added products. This is why its textile companies are moving mostly to Vietnam. By the way, the labor cost is not the only factor in the costing of a product.

Vietnamese wages will also keep on increasing at the pace of its development of non-textiles manufacturing sectors in metal and petrochemical/plastics products.

 

[bluesky]

Both Italian and Turkish Lira (old ones) saw the same kind of downstream effects from earlier upstream inflation (or even hyperinflation) episodes. Even Japanese Yen to some degree (thats why like 100 yen is like 1 USD traditonally).

Sometimes countries create new version and revalue and reissue to make things simpler. Turkey did that with new lira, thats why its like 1 USD = 7 lira now or so rather than some million lira like before.

Taiwan also has New Taiwan Dollar etc for similar reason, coz the old one depreciated to some crazy level.

But the number itself in current time frame is not really an indication of snapshot of the current economic strength by itself....as a country can meaningfully stabilise its currency rate and inflation rate at any level be it 1, 10 or 10,000 or 10 million even to a dollar (though the larger it is, the kind of sillier it is to have it there).

Throughout the world there have been currency fluctuations. Think about German Mark when people had to carry suitcase full of money to buy groceries because of hyperinflation. Indonesia also faced similar phenomenon in a lower scale.

British pound also fell vis-a-vis dollar. As far as i know, 1 British pound could buy 5 US dollar before WWll. After the war, it can buy something like $1.5.

In the case of Japan, 1 dollar was 4 yen sometime before the war. Post-WWll, the GoJ took a very pragmatic step to revive its manufacturing and export economy to the pre-war level by fixing the rate at $1 equal to Y360. Gradually, with its economic performance it started to appreciate through a few decades. Now, 1 dollar is about Y108 -110.

 

[Archie]

Try and find another sector for export growth

You can’t rely on being the sweatshop of the world

 

[Bilal9]

Try and find another sector for export growth

You can’t rely on being the sweatshop of the world

 

[Bilal9]

 

[Bilal9]

Walton has commenced export of Compressors to Turkey.

 

[Nike]

One company can't change the entire country though, South Korean Samsung is a behemoth, but South Korean still had LG, LOTTE, DAEWOO,Hyundai and among other to prop their economy. Japan too, Honda, Toyota, Sony, Toshiba, SoftBank and other is behemoth at their respective field and one still need the support of many companies especially the middle and small ones in which emphasize the use of technology and efficiency to boost the whole country productivity.

 

[Viet]

No, the factory worker salary remains about $230 per month in Vietnam. In comparison the factory wage in China is more than $700. So, it is more than three times in China and it will keep on increasing as China moves towards more value-added products. This is why its textile companies are moving mostly to Vietnam. By the way, the labor cost is not the only factor in the costing of a product.

Vietnamese wages will also keep on increasing at the pace of its development of non-textiles manufacturing sectors in metal and petrochemical/plastics products.

Can be the case I don’t know. There are stats showing Vietnam labor cost is 1/2 of China. Vietnamese tend not working overtime while Chinese are more willing. More working hours more money.

https://www.statista.com/statistics/744071/manufacturing-labor-costs-per-hour-china-vietnam-mexico/

It’s good that our wages are much lower. Otherwise how we can attract factories?
Garment is just small portion of our exports we had 270 billion USD in exports. The government predicts the trend will continue in the years (to boost exports we just signed off to Tpp and EU free trade pacts) our exports will reach 340 billion in 2025. Depending on the pace of US/China trade war we could reach somewhere between 500 billion or in a most optimistic scenario one trillion USD in exports. Garment will just play a minor role even we overtake Bangladesh garment exports. Don’t forget we make own smartphones, 5g, automobiles, warships, vessels, etc while many other rich countries can’t.

 

[bluesky]

Can be the case I don’t know. There are stats showing Vietnam labor cost is 1/2 of China. Vietnamese tend not working overtime while Chinese are more willing. More working hours more money.

https://www.statista.com/statistics/744071/manufacturing-labor-costs-per-hour-china-vietnam-mexico/

It’s good that our wages are much lower. Otherwise how we can attract factories?
Garment is just small portion of our exports we had 270 billion USD in exports. The government predicts the trend will continue in the years (to boost exports we just signed off to Tpp and EU free trade pacts) our exports will reach 340 billion in 2025. Depending on the pace of US/China trade war we could reach somewhere between 500 billion or in a most optimistic scenario one trillion USD in exports. Garment will just play a minor role even we overtake Bangladesh garment exports. Don’t forget we make own smartphones, 5g, automobiles, warships, vessels, etc while many other rich countries can’t.

The present Vietnamese export performance is quite large. However, you may be projecting too fast and too far. Please note when your industries are geared with non-textile high-value metal and plastic-based production, it means the labor cost will also go high and high.

In that case, Vietnam will have to compete with the already established countries with its lower price, higher quality assurance and name value. However, Vietnam has one good advantage, that is the FDI companies invest, produce and export to their markets throughout the world.

 

[Nike]

The present Vietnamese export performance is quite large. However, you may be projecting too fast and too far. Please note when your industries are geared with non-textile high-value metal and plastic-based production, it means the labor cost will also go high and high.

In that case, Vietnam will have to compete with the already established countries with lower price, higher quality assurance and name value. However, Vietnam has one good advantage, that is the FDI companies invest, produce and export to their markets throughout the world.

When economy is more geared toward resale products, they become a hollow manufacturing center. Vietnam import large goods from China and rebranding it so Chinese goods can circumvent many trade barrier being set up against them and Vietnam can gain comission fee. And with Vietnam can easily gaining FTA with several large player it is just a ploy to many.

 

[Tom-tom]

One company can't change the entire country though, South Korean Samsung is a behemoth, but South Korean still had LG, LOTTE, DAEWOO,Hyundai and among other to prop their economy. Japan too, Honda, Toyota, Sony, Toshiba, SoftBank and other is behemoth at their respective field and one still need the support of many companies especially the middle and small ones in which emphasize the use of technology and efficiency to boost the whole country productivity.

We need another 7 waltons, Walton bds can be premium brand that targets west and other rich places as well as being on offer everywhere else.

Other bd brands can target asia, Africa, Latin America

 

[bluesky]

When economy is more geared toward resale products, they become a hollow manufacturing center. Vietnam import large goods from China and re-branding it so Chinese goods can circumvent many trade barrier being set up against them and Vietnam can gain commission fee.

You cannot really say it is a pure HOLLOW manufacturing because even with this re-branding work for commission, Vietnamese people gain employment. It may consist of following activities:

- C&F works at the port
- unloading from ships
- transportation by trucks/rails to factories
- doing assembling/re-assembling/finishing works
- packaging/repackaging works
- C&F for shipping
- transportation to ports
- loading to ships, etc. etc.

All the above activities generate wages. So, even just a re-packaging work is not a waste. This is how a developing country locks itself with the process of foreign trade that generates employment and wages, and raise GDP. After all, GDP is the cumulation of all economic activities in a country expressed in the local currency or in dollar.

 

[Viet]

When economy is more geared toward resale products, they become a hollow manufacturing center. Vietnam import large goods from China and rebranding it so Chinese goods can circumvent many trade barrier being set up against them and Vietnam can gain comission fee. And with Vietnam can easily gaining FTA with several large player it is just a ploy to many.

Nonsense
That’s difficult now with reexport. Many countries keep watch on chinese exports so I think just a tinny portion of chinese goods are reexported.
We make real things than just shoes and garments.
Many aero parts factories are opening. For example the new UAC in Danang will make 4,000 different aircraft component parts (a aircraft has about 5 million component parts).

Kevin Loebbaka, managing director

 

[Indos]

Garment is just small portion of our exports we had 270 billion USD in exports. The government predicts the trend will continue in the years (to boost exports we just signed off to Tpp and EU free trade pacts) our exports will reach 340 billion in 2025. Depending on the pace of US/China trade war we could reach somewhere between 500 billion or in a most optimistic scenario one trillion USD in exports. Garment will just play a minor role even we overtake Bangladesh garment exports. Don’t forget we make own smartphones, 5g, automobiles, warships, vessels, etc while many other rich countries can’t.

It is quite strange to see Vietnamese export that is similar and even surpass its nominal GDP figure in 2018