ANOVA
12.188 6 2.031 2.664 .028
32.792 43 .763
44.980 49
24.520 6 4.087 3.099 .013
56.700 43 1.319
81.220 49
43.959 6 7.326 3.936 .003
80.041 43 1.861
124.000 49
22.861 6 3.810 2.072 .076
79.059 43 1.839
101.920 49
1.500 6 .250 3.583 .006
3.000 43 6.977E-02
4.500 49
1.253 6 .209 5.733 .000
1.567 43 3.643E-02
2.820 49
19.921 6 3.320 2.691 .026
53.059 43 1.234
72.980 49
Between Groups Within Groups Total
Between Groups Within Groups Total
Between Groups Within Groups Total
Between Groups Within Groups Total
Between Groups Within Groups Total
Between Groups Within Groups Total
Between Groups Within Groups Total
International competition
Export Barriers due t o unf air com pet it ion Export Barriers due t o low price in import market
Purpose of using internet is searching general market inf ormation Reason f or not using internet is helpf ulness Reason f or not using internet is lacking int ernet skill
Export motiv e of the company is gov ernment incentiv es
Sum of
Squares df Mean Square F Sig.
It is very interesting to see that there is a significant difference between various industries and international competitiveness. Nevertheless, generally all SMEs do not have high competitiveness in international market (mean of 2.9) but some industries clearly show their strong position like Handicrafts (mean 4). Even though handicrafts account for only 8.2% of the total
43
interviewed SMEs, all of them say that their international competitiveness are high compared with other foreign competitors. Textile and Garment SMEs hold a surprising low position with mean of 2.4 despite this industry seems to be one of Vietnamese export strengths. This raises a question of whether those support from government incentives and policies really support this industry.
It also helps to explain the above situation when looking at other strong relations between export barriers and industries which SMEs belong to. As can be seen from table 4.24, most of industries faced high barriers in the import market. It is a negative sign to see that unfair competition is the very big obstacle of Textile and Garment and Footwares and Leather. Moreover, Food Processing industry and especially Chemistry cannot gain much profit or are even kicked out of the market due to low price of the export product.
Vietnam usually takes low labor cost as a competitive advantage but considering this situation, it seems that the labors are exploited unfairly.
Therefore, it can be easily understood that with no advantage of low labor cost in the latter two industries, Vietnamese products immediately cannot compete with others in term of price. However, handicrafts shows a good signal and a compensation for the other industries when it is found that Vietnamese handicrafts products seem to be highly evaluated and well recognized with almost no unfair competition.
44 Table 4.24
Exp or t bar rier d ue to unfai rco mpetiti on b y Ind ustr y
4.30 3.70
23.5% 20.6%
4.67 3.33
7.7% 5.6%
2.67 1.00
4.4% 1.7%
4.33 4.17
14.2% 13.9%
3.88 4.75
16.9% 21.1%
2.00 5.00
3.3% 8.3%
3.24 3.06
30.1% 28.9%
3.66 3.60
100.0% 100.0%
Mean Mean Mean Mean Mean Mean Mean Mean Industry in which f irm
operate
Textile and Garment Footwares and Leathers Handicraf ts
Food Processing Wooden Processing Chemistry
Others Total
Export Barriers due
to unf air competition
Export Barriers due to low price in import market
The story is more interesting and surprising when looking at the significant difference between industry regarding government incentives. It is surprising because it is Textile and Garment industry which receives most incentives from government which is reportedly the most important export motive for their companies whereas this industry is having low international competitiveness with ranges of unfair barriers. This really raises the question of why and most likely if there is any distortion between government policies and the implementation to bring the real effective support to SMEs.
Moreover, it is also interesting to see if the SMEs themselves are well aware of this situation. This is hypothesized that it can be attributed to the trade promotion network in realizing government incentive policies.
Another point worth to be mentioned is that, according to SMEs in handicrafts industry, they get almost nothing from Government incentives.
Neither do they highly evaluate those incentives while at the same time they achieve lots of success in international market. This again can be argued what proper government incentives are and whether they really support the right
45
industries fairly. Notably, even though there is a rosy picture on this handicrafts industry and the export share of this industry seems to be high but there is no significant difference between export share and industry to be sure in actuality this industry can earn large export revenue quantitatively.
Table 4.25
Gover nment incent ives by in dust ry
Export motiv e of the company is gov ernment incentiv es
3.40 22.8%
2.33 4.7%
1.00 2.0%
2.67 10.7%
2.63 14.1%
3.33 6.7%
3.41 38.9%
2.98 100.0%
Industry in which f irm operate
Textile and Gar ment Footwares and Leathers Handicraf ts
Food Processing W ooden Processing Chemist ry
Others Total
Mean
% of Total Sum