Preface

It is widely acknowledged that foreign trade holds a significant position in a country's economic system, with its role not only in optimizing global resource allocation but also in helping to maintain economic stability.

China is a country with a high dependency on foreign trade, especially in the manufacturing sector, where it has shown remarkable performance.

Domestically, competition among provinces is becoming increasingly fierce, and Guangdong, with its formidable production capacity, is known as the "world's factory."

Guangdong's Manufacturing Industry

In 2021, the number of people employed in the manufacturing industry in Guangdong Province reached 10 million, and it is projected to surge to 13.5 million by 2025.

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Such a vast manufacturing workforce, coupled with the gap between Vietnam, a Southeast Asian small to medium-sized country, and Guangdong, makes Guangdong's strength truly formidable.

Because of this, Vietnam is gradually emerging in the global market, even surpassing India and Bangladesh.

In the first half of 2023, Vietnam achieved a trade export volume of 1.34 trillion, with the processing manufacturing industry accounting for 80%.This achievement has a significant gap with China, which has also attracted attention to the development potential of Vietnam's manufacturing industry.

However, at the same time in China, the total output value of manufacturing industry in Guangdong Province has reached 11 trillion, accounting for 25% of the total value of the national manufacturing industry. In contrast, Vietnam's manufacturing industry is only 8 trillion.

Such a clear gap has sparked people's thinking.

How can we achieve the same high GDP as Vietnam?

By comparing the manufacturing data of China and Vietnam, it can be found that although Guangdong Province has a higher GDP level than Vietnam, it is obviously at a disadvantage in terms of trade exports.

To achieve the success of Vietnam, where does Guangdong Province need to work specifically?

Vietnam VS our country.

According to the data released by the Vietnamese government, since January 2023, Vietnam's total trade export volume has reached about 424 billion US dollars.

This number has surpassed China, Germany, and the Netherlands, ranking fifth in the world.

In the Southeast Asian region, although ASEAN countries have a huge market potential, they are only ranked sixth in the global trade ranking.According to data from 2023, the total export volume of ASEAN was 2.5 trillion US dollars.

Among them, Vietnam, as one of the top five exporting countries, has particularly outstanding performance.

In Southeast Asian countries, Vietnam's total trade volume accounts for 16.2%, indicating that Vietnam's economic status in the Southeast Asian region is increasingly improving.

At the same time, other Southeast Asian countries are also following Vietnam's example to explore new opportunities.

Although India has a population of 1.3 billion, it does not have an advantage in manufacturing.

The reason is that the quality of India's labor force is generally low and lacks relevant experience.

In addition to the low quality of the labor force, India's business environment is also relatively poor, with a large amount of corruption and robbery.

This bad business environment makes it difficult for Indian companies to develop, further leading to a global industrial output share of about 2% to 3%.

In the future, if India wants to achieve its "Made in India" goal, the overall quality of its labor force needs to be improved.

Firstly, India needs to improve the overall quality of the labor force by reforming the education system.Secondly, India also needs to improve the local business environment to attract more foreign investment.

The reasons for Vietnam's success.

In fact, Vietnam still has a long way to go to surpass Guangdong.

Compared to Vietnam, China, with its strong productivity, has more advanced production equipment and a large number of excellent technical talents.

At the same time, China also has a high-quality demographic dividend.

Vietnam has a unique geographical advantage.

Vietnam is close to China and closely connected with the Southeast Asian region.

Vietnam's geographical location makes it a regional center, which gives it a great advantage in attracting foreign investment.

Especially in trade with China, Vietnam can quickly improve its own manufacturing level by leveraging China's manufacturing technology and experience.

At the same time, Vietnam also has a higher quality of labor force.Despite the relatively low labor costs in Vietnam, the quality of Vietnamese workers is generally high. They have received better education and possess certain skills and experience. This higher quality of the labor force makes Vietnam more attractive in attracting foreign investment. In addition, Vietnam's policy flexibility is also one of the keys to its success. The Vietnamese government has an open attitude towards attracting foreign investment and has actively removed some obstacles to create a better business environment. This policy flexibility has enabled Vietnam to quickly attract a large amount of foreign investment, thereby promoting the development of the domestic economy. Guangdong Province was not so powerful from the beginning. In 1984, Shenzhen developed from a small fishing village into a metropolis with a population of tens of millions, which laid the foundation for the development of Guangdong. To achieve a GDP as high as Vietnam, Guangdong Province needs to find industries suitable for development and attract talents and enterprises. With the development of technology, future manufacturing will rely more on automation and artificial intelligence, not just labor costs.Guangdong Province needs to place greater emphasis on innovation and technological research and development in order to maintain its competitiveness in the global market.

Conclusion

Vietnam's success may inspire other Southeast Asian countries to follow suit, which could alter the future layout of global manufacturing.

An increasing number of countries may realize that, with their geographical advantages, policy flexibility, and higher quality of labor force, they can also secure a place in the global market.

If this is the case, the Southeast Asian region will become the new center of global manufacturing.

Under such circumstances, China also needs to continuously upgrade its industries to maintain its competitiveness in the global market.

At the same time, if Vietnam can improve its manufacturing level while maintaining policy flexibility, it is expected to become a leader in global manufacturing.

We will wait and see what the future economic landscape will look like.