VietNamNet Bridge - Given that imports of CBU (complete built unit) cars from China to Vietnam is increasing massively as the import tariff on CBU is lower than those of auto components, the Vietnam Mechanics Association has filed a petition asking for the Prime Minister’s help.

However, some economists said that domestic firms have to accept the fact, and instead of calling for help, they should become familiar with competition to participate in the game of integration.

The Vietnam Mechanics Association has filed grievances with the Prime Minister because of the large imports of Chinese CBU trucks into Vietnam, which is a big threat for the development of the domestic auto industry.

Discussing the issue, Prof. Dr. Dang Dinh Dao, former Director of the Institute for Economic Research and Development, National Economics University in Hanoi said that the petition is understandable because this directly affects the interests of the automotive industry in Vietnam.

"However, this story reflects the weakness of the automotive industry of Vietnam. They have to accept the massive imports of CBU, cannot call for the government to impose barrier as before. We have to accept the competition to participate in the game of integration," said Professor Dao.

Dao said the import of CBU trucks into Vietnam is a warning for the Vietnam automobile industry that they must rise, not lag behind forever, though it is extremely difficult.

"The authorities should also consider and evaluate the actual situation to have response to the concerns of auto manufacturers on the difference between the tariff on auto components and CBU,” he added.

Dr. Huynh The Du - lecturer at the Fulbright Economics Teaching Program – said that it was not unusual for the local auto manufacturers to file a complaint to the PM. Like the Vietnam Sugar Association, when their interest is affected, they reacted the same.

"In fact, in some areas we do not have the ability to compete, but we try to create barriers to have a competitive advantage. However, such barriers can be used in a certain period. When our market is intergrated into the world, the tariff barriers will not work anymore," said Dr. Du.

He said the nature of market competition is fierce and when Vietnamese enterprises join the game of integration, they must obey global rules and adapt. To gain advantage, Vietnamese businesses have to focus on their strengths and not pursue areas where they are weak.

"There are many examples of an inappropriate focus of resources, for example the shipbuilding industry 10 years ago. At that time everyone thought that we could take off with it, so we poured so much money in it, but in the end we could not develop it," Dr. Du said.

The Fulbright lecturer took an example: a piece of fabric that can be enough to sew a shirt for a family with five children. Should we use that piece of cloth to sew a shirt for a kid or tear it into five pieces as towels for five kids? It is better to give that piece of cloth for one.

"Similarly, we should focus resources in the strongest sector to promote efficiency at the highest level," Dr. Du said.

Minh Son