Developing materials industry to build strong manufacturing foundation

The materials and mechanical engineering industries are widely regarded as the foundation of industrial production, determining a nation's manufacturing capacity, industrial self-reliance, and economic competitiveness.

Supporting industrial products for the automobile and motorcycle manufacturing sectors at Tuong Lai (Future) Co., Ltd. in Long Thanh Ward. Photo: Vuong The

Mastering technology and increasing domestic value added are now urgent requirements for industrial production, particularly in the materials and mechanical engineering industries.

A cornerstone of industrial production

The mechanical engineering and materials industries form the backbone of industrial development, playing a vital role in economic and industrial self-sufficiency, energy security, infrastructure resilience, and national defense. They supply essential inputs for key sectors, including construction, transportation, energy, manufacturing, electronics, semiconductors, healthcare, and other high-tech industries. The level of development of a country's materials industry is widely seen as a direct indicator of its industrialization, scientific and technological capabilities, and economic independence.

Vietnam, in general, and Dong Nai, in particular, have become a regional manufacturing hub for electronics, mechanical engineering, textiles and garments, footwear, and industrial equipment. However, they still rely heavily on imported high-tech materials. Many manufacturers can produce components, but must import specialty alloy steel. Electrical equipment manufacturers remain dependent on engineering polymers and high-purity chemicals, while battery producers have yet to master the production of many core materials.

Statistics show that Vietnam's imports exceeded USD283 billion in the first half of 2026, up 33.4% year-on-year. The domestic economic sector recorded a trade deficit of nearly USD25 billion, while the foreign-invested sector posted a trade surplus of approximately USD8.3 billion.

Vietnam aims to establish three to five national materials research centers by 2030 while developing domestic materials enterprises capable of leading supply chains.

Notably, more than 94% of the country's imports consist of production materials. Vietnam requires large volumes of industrial inputs, including alloy steel, engineering-grade aluminum, refined copper, engineering polymers, industrial rubber, basic chemicals, electronic materials, semiconductor-grade silicon, rare-earth materials, and battery and energy-storage materials.

Recently, the Politburo's Resolution No. 10-NQ/TW on the development of the foreign-invested sector emphasized the need to improve the spillover benefits of foreign investment for the domestic economy. However, Vietnamese enterprises still face significant limitations in supplying local industries. According to Dr. Huynh Thanh Dien, a lecturer at Nguyen Tat Thanh University in Ho Chi Minh City, Vietnam needs a comprehensive national supplier development program that places businesses at its center, enabling domestic firms to participate more effectively in both national and global supply chains.

At the enterprise level, companies are also striving to increase self-reliance. Friendly Plastics Co., Ltd., located in the Ho Nai Industrial Park, has achieved partial self-sufficiency by incorporating recycled materials into its production process. According to Duong Quang Tien, the company's Director of Business Development and Market Expansion, mastering research and development, material formulation, mold design, and automated manufacturing has significantly strengthened the company's competitiveness.

Moving toward advanced industrial development

In response to the requirements of industrial development in the new era, General Secretary and State President To Lam chaired a working session on May 21, 2026, with the Central Policy and Strategy Commission and several relevant ministries and agencies to discuss directions for the development of Vietnam's materials industry. General Secretary, State President To Lam noted that Vietnam lacks neither natural resources nor market demand. Its greatest shortcomings are in core technologies, deep-processing capabilities, leading enterprises, an ecosystem for research, testing, inspection, and commercialization, and a sufficiently robust integrated strategy for organizing a national materials value chain. Therefore, the materials industry must be identified as a strategic, foundational industry in Vietnam's industrialization and modernization process.

Products of Diep Nam Phuong Joint Stock Company at Loc An - Binh Son Industrial Park.

The General Secretary and State President To Lam called for mastering technology and increasing domestic value added, with science and technology, standards, highly skilled human resources, and Vietnamese enterprises serving as the pillars of development. He also called for the materials industry to develop along green, sustainable, and self-reliant lines, become internationally competitive, comply with international commitments, and safeguard national interests to the greatest extent possible.

The Ministry of Industry and Trade has drafted an outline for the Strategy for Developing Vietnam's Materials Industry through 2030, with a Vision to 2045. At a briefing on July 7, Nguyen Nam Binh, Head of the Minerals and Metallurgy Division under the Industry Agency (Ministry of Industry and Trade), said the strategy envisions building comprehensive national capabilities covering research, design, testing, standardization, manufacturing, commercialization, recycling, and supply security. The long-term objective is to establish a complete industrial value chain spanning raw materials, deep processing, advanced materials, components, equipment, industrial products, markets, and recycling.

Alongside businesses, Dong Nai is actively promoting greater manufacturing self-reliance. The city is placing particular emphasis on developing supporting industries that supply inputs for manufacturing. By 2035, supporting industries are expected to account for 21–23% of the city's total industrial output. By 2030, Dong Nai aims to have approximately 1,200 enterprises operating in supporting industries. To achieve these goals, Dong Nai plans to develop additional supporting-industry industrial parks and clusters while introducing incentive policies, particularly in finance, taxation, technical assistance, and industrial management.

By Vuong The – Translated by Mai Nga, Minho