Thesis an analysis of factors affecting the competitiveness

Dang Hoai Anh HS130186 Dang Cam Trang HS130211 Bui Minh Dung HS130085 Pham Ha Nhat Huy HS130168 Nguyen Bao Thach SB02456 Mrs. Cung Thi Anh Ngoc 1|Page ACKNOWLEDGEMENT This dissertation took a circuitous route to completion. It was completed largely due to the efforts of exceptional individuals and organisations who pushed, helped, and stayed with us all the way. We want to express our heartfelt appreciation to Mrs.

Cung Thi Anh Ngoc, our research supervisor, for her inspiration, diligence, and invaluable advice during the research phase, which aided us in completing this report. Second, we would like to express our gratitude to FPT University for their guidance and encouragement during the graduation process. Finally, we would like to express our gratitude to numerous pangasius and seafood firms for their assistance and anyone who took the survey and contributed their thoughts and knowledge throughout the study phase. Without their generosity, it would be not easy to complete the study.

Hoa Lac, May 5th, 2021 Authors of thesis 2|Page EXECUTIVE SUMMARY Export is the main activity in international exchange, and has a long tradition and continues to grow significantly in breadth and scope. Globalization also accelerated the growth of exporting practices across countries. Vietnam - a developing nation - is no exception, as shown by the pangasius industry's rapid development. With favourable natural environments and plentiful labour capital, Vietnam has leveraged its economic advantages to become one of the largest world-class pangasius exporters in recent years, contributing significantly to various aspects of the Vietnamese economy.

Notably, for several years, China has been one of the largest and most competitive markets for Vietnamese pangasius. China's consumer size has increased significantly in recent years and is projected to become the largest market for Vietnamese pangasius exporters by 2020. However, due to COVID 19, the value of Vietnamese pangasius exports in this sector has lacked compared to the market's actual capacity, resulting in low and unpredictable profits for pangasius farmers. Indeed, pangasius export has been debated both internationally and domestically by several interested scholars, but most of these discussions are out of date.

Thus, this study used a quantitative methodology based on the National Competitiveness Pyramid and a qualitative tool to comprehensively analyze the association between many variables and Vietnam's pangasius export turnover to China from 2016 to 2020. SPSS 26 was used to scrutinize a panel data set of 186 findings to provide explicit support for this paper's conclusion. Following 186 survey answers, the study identifies seven major components that contribute to the competitiveness of Vietnamese pangasius in China: Business Environment, Physical Infrastructure, Knowledge Infrastructure, Product, Productivity, Price, and Labour Supply. It is discovered that these seven elements all have a strong correlation with competition, with Physical Infrastructure having the most significant effect on service efficiency.

Following that, some recommendations were made to increase Vietnamese pangasius exports to China between 2021 and 2030. 3|Page TABLE OF CONTENTS ACKNOWLEDGEMENT. 3 LIST OF FIGURE. 8 LIST OF CHART.

8 LIST OF TABLES. 8 ABBREVIATIONS AND ACRONYMS LIST .5 Methodology and data overview. 14 CHAPTER 2: LITERATURE REVIEW. Overview of export .1 Definitions of export.

Importance of export .2 Overview of pangasius export .1 Definition of pangasius (including HS code) .2 The importance of fish export to Vietnam .3 Characteristics when exporting pangasius .3 General theory of competitiveness .1 Theory of competition in business .3 Levels of competitiveness .4 The importance of improving competitiveness .4 Recent studies related to thesis topic .3 Summary of literature review .1 The original model .2 The modified model .3 Data collection methods. Sampling and collecting data. Data analysis methods. Definition of SPSS.

Data analysis of SPSS .5 Ethical Consideration and Limitation .2 Limitations of the research project. 49 CHAPTER 4: ANALYSIS AND FINDINGS .1 Overview of Vietnam’s Pangasius export .1 Pangasius export turnover .2 Overview of China market. Introduction to China market .3 Analysis of factors influencing Vietnam’s pangasius export .2 Findings - Achievements and Limitations. 85 CHAPTER 5: CONCLUSION AND RECOMMENDATIONS.

Summary of findings – answer the research questions .2 Vietnam’s pangasius export target to 2030.2 Pangasius oriented development. Recommendations for factor Business Environment. Recommendations for factor Physical Infrastructure. Recommendations for factor Knowledge Infrastructure.

Recommendations for factor Product. Recommendations for factor Productivity. Recommendations for factor Prices. Recommendations for factor Labour Supply.

Limitations and suggestions for further research. 106 7|Page LIST OF FIGURE Figure 2.1: The Competitiveness Pyramid (NCC, 2010) Figure 2.2: Factors affecting competitiveness of Vietnam’s pangasius exporting companies Figure 3.1: Research philosophy Figure 3.2: Deductive process in research approach Figure 3.3: Inductive process in research approach LIST OF CHART Chart 4.1: Structure of pangasius exported by HS code in 2019 Chart 4.2: Pangasius export turnover of Vietnam 2016-2020 Chart 4.3: Top 5 pangasius export markets of Vietnam Chart 4.4: The export volume of pangasius to China market 2016-2020 Chart 4.5: Type of business Chart 4.6: Size of business Chart 4.7: Pangasius area and production in the Mekong Delta from 2016 to 2020 Chart 4.8: Prices of raw pangasius in Vietnam 2015-2020 Chart 4.9: Pangasius price imported to China market year 2015-2020 Chart 4.10: Vietnam's pangasius export price in international market LIST OF TABLES Table 2.1: HS Code of pangasius Table 2.2: Summary of key studies related to the thesis Table 3.1: The Research Process Table 4.1: Factors descriptive analysis Table 4.2: Reliability result Table 4.3: Results of Exploratory factors analysis for independent factors Table 4.4: Results of Exploratory factors analysis for dependent factors Table 4.5: Results of Correlations analysis Table 4.6: Competitiveness model summary and Results of ANOVA test Table 4.7: Competitiveness Coefficients Table 4.8: Hypotheses tested result Table 4.9: List of pangasius production facilities certified by GlobalGap 8|Page ABBREVIATIONS AND ACRONYMS LIST ACFTA The ASEAN - China Free Trade Agreement ASC Aquaculture Stewardship Council ASEAN Association of Southeast Asian Nations BE Business Environment CEE Central and Eastern European CFA Confirmatory Factor CFR Cost and Freight COVID 19 Coronavirus pandemic CP Competitiveness of Vietnamese exporting pangasius companies EFA Exploratory Factor EU European Union FDI Foreign Direct Investment GDP Gross Domestic Product GNP Gross National Product HACCP Hazard Analysis and Critical Control Point HS Code Harmonized System Code KI Knowledge Infrastructure KMO Kaiser-Meyer-Olkin coefficient LS Labor Supply NCC National Competitiveness Council NRC National Research Council PI Physical Infrastructure PR Product PS Prices PV Productivity SEM Structural Equation Model SQF Safe Quality Food SWOT Strength, Weakness, Opportunity, and Threat TEU Twenty-foot equivalent unit US The United States of America USD United States dollar VASEP Vietnam Association of Seafood Exporters and Producers VIF Variance Inflation Factor WTO World Trade Organization 9|Page Chapter 1 - Introduction provides a brief of the research topic overview, practical problem, research objectives, research questions, research scope, methodology, and data overview. Topic background Pangasius is a species of catfish in the family Pangasiidae distributed in the Mekong basin. Pangasius is cultured in Vietnam, especially in the Mekong Delta.

Vietnamese pangasius is very popular in the world market, which is considered the most suitable substitute for white fish scarcity. Vietnamese pangasius has become a major source of many important market areas. According to the Vietnam Association of Seafood Exporters and Producers (VASEP) (2019) information, pangasius is mainly raised in 10 provinces of the Mekong Delta of Vietnam. The provinces of Can Tho, An Giang, Dong Thap are the largest pangasius farming areas in the Mekong Delta, accounting for more than 75% of the total pangasius.

The whole country currently has 200 establishments producing pangasius breeds, 3,000 ha of rearing, producing about 21 billion pangasius breeds, more than 2.1 billion pangasius breeds. Pangasius products are manufactured according to strict international quality management standards and strict food safety such as globalgap, ASC, BAP, etc. Pangasius is increasingly popular in the world thanks to its nutritional value. In 2019, Vietnam exported pangasius to 131 markets.

Those main markets include China, the United States of America, Europe, ASEAN, etc. Total pangasius export turnover in 2018 achieved a record 2.26 billion USD, up 26. Due to the disease COVID 19, pangasius export in 2020 reached about 1.54 USD billion, down 23% compared to 2019 (VASEP, 2019). The information shows that Vietnam's pangasius export market fluctuates from year to year.

For the Chinese market in the past 11 months of 2020, China continued to be the country with the largest proportion of Vietnam’s pangasius exports. According to the incomplete statistics of VASEP, although down 20.6% over the same period last year, the total value of fish exports to Mainland China and Hong Kong (China) reached USD 385.4 percent of the total pangasius export value. Practical problem Competition in the economic sense is the competition between people producing goods, between traders in the economy to win the most favorable production, consumers, and market conditions. It is the same as export, in Vietnam, we are on growing momentum and consider our export operation as the development of the economy.

So it is vital to raise the 11 | P a g e competitiveness of Vietnam's exports. More specifically, the competition of exporting Vietnamese pangasius to the Chinese market. According to VASEP, in early 2019, 33 aquatic items were confirmed by the Chinese side to import tax-free into China, including pangasius. When the US-China trade war broke out, Chinese businesses tended to import more pangasius products from Vietnam as alternative sources.

Chinese consumers favor Vietnamese pangasius products. With the growing trend, these consumers tend to increase the demand for aquatic imports due to concerns about food safety, mainly foreign and new products. They are also willing to pay for products accepted by the US and European markets (Anh, 2019). A typical example is the pangasius product of Vietnam.

Exports increased gradually from 2015 to 2019, most in 2019, up to 663 million USD, far ahead of the US and EU. However, Vietnam's pangasius export turnover to the Chinese market in 2020 dropped sharply. As stated by VASEP, pangasius exports in 2020 sharply declined because goods at Chinese border gates were stuck waiting for sampling for COVID 19. Pangasius export to this market has been delayed.

As VASEP (2019) maintained, Vietnam's pangasius industry faces many Chinese market competitors, including India, Indonesia, and Bangladesh, etc. Both China and India have invested in high technology to raise pangasius actively. Along with that, Chinese pangasius import standards are no different from the US or EU standards. In the United States, Laws enacted to ensure food supplies' safety and establish the level of national protection as some critical laws and regulations related to seafood safety include CFR federal law, Federal law on food, medicine, and cosmetics.

The EU ensures the implementation of the law on food safety and checks the compliance of production and business establishments with regulations on food safety at all stages of the production, processing, and distribution process. In terms of exporting pangasius to China, Vietnam's suppliers who want to export pangasius to China must have quality certificates such as HACCP Standards, SQF Standards, and globalgap Standards. Vietnam's export description has met the above criteria to enter the Chinese market. Due to the COVID 19 epidemic effect, depending on the Chinese market, the revenue and profits from pangasius exports of domestic enterprises have declined sharply in recent years.

Through the above, it is evident that businesses need to pay more attention to quality, traceability standards, and food safety requirements, which are becoming stricter like in the US or EU; many competitors proactively improve product quality by investing in high 12 | P a g e technology to raise pangasius. As a result, it is urgent to determine the factors affecting Vietnam's pangasius export competitiveness, thereby offering solutions to improve competitiveness and help export businesses deal with immediate problems in this market.2 Research question The topic needs to answer the following questions: ● What is the situation of exporting Vietnamese pangasius to China in the past five years (2016-2020)?