Industry Focus

Trend Analyses ofVietnamese Fastener Industry
1. Introduction
Since Vietnam launched a reform andopened its ow n ma rket i n 1986, it has
gradually been connecting with the globale c o nomy. It p r omu lg at e d t he For eig n
Investment Law in 1987, joined the WTO in
2007, and has gradually transitioned froma centrally planned economy to a marketoriented economic system. Although thecomplex global political and economic
landscape has impacted most economies inrecent years Vietnam's GDP still grew at
a rate of 5.05% in 2023, its manufacturing
output grew 3.02%, and its trade surplus
reached a record high of US$ 28 billion.
Vietnam effectively leverages structuralchanges in global trade to support its GDP
growth and benefits from the shift in global
supply chains. Inter national companies
such as Apple and Samsung Electronics areexpanding their manufacturing and R&D
activities in Vietnam.
The reason why Vietnam is one of theworld's important manufacturing and export
centers is that as of 2023, Vietnam has signed
15 FTAs with important trading partners,
including Comprehensive and ProgressiveAgreement for Trans-Pacific Partnership (CPTPP ), Regional Comprehensive Economic
Par t nership (RCEP), EU-Viet nam Free
Trade Agreement (EVFTA), and agreements
signed by the Association of Southeast Asian
Nations (ASEAN) with China, Japan, India,
South Korea, etc. Vietnam’s political stability
and relatively low production costs and land
rents increase the country’s competitive
adva nt ages. Th is ar t icle beg i ns from
Vietnam’s fastener import and export
to explore whether the export-oriented
Taiwan fastener industry has opportunities
to use Vietnam’s advantages in globaleconomy, trade and geographic location inorder to expand the global deployment ofTaiwan fastener industry. From there, thisarticle provides analyses and suggestions.

2. Global Import and Export of the Fastener
Industry in Major ASEAN Countries(a) Import Analysis
Table 1 shows the trend of major ASEAN countries importing fastener products
from the world from 2019 to 2022. The top three fastener-importing ASEAN countries
were Thailand (approximately NT$32.94 billion), Vietnam (approximately NT$21.77billion), and Malaysia (approximately NT$18.02 billion). Although the volume produced
and sold by Vietnam on its own is a factor that has to be considered in pinpointing
domestic demand, the import trend reflects Vietnam’s demand for fastener products.
Over the years, Thailand has been the largest importer of fasteners in ASEAN,
accounting for about 30% of imports by ASEAN countries. The fastener importsof major ASEAN countries all had positive growth. In the past four years, fastener
importing countries with the highest compound growth rate were Malaysia (15.3%),
Philippines (11.3%), and Vietnam (8.3%).

(b) Export Analysis
Table 2 shows the major ASEAN countries exporting fastener products to the worldfrom 2019 to 2022. The top three ASEAN countries exporting fastener products wereVietnam (approximately NT$20.28 billion), Thailand (approximately NT$19.86 billion)
and Singapore (about NT$10.99 billion). Vietnam, the largest fastener exporter inASEAN, had a compound growth rate of about 14.4 % in the past four years, accounting
for nearly 30%. Thailand and Vietnam have been equally matched in fastener export formany years, but since the compound growth rate of Vietnam's fastener export is muchhigher than that of Thailand, it is roughly determined that Vietnam will set out tobecome the largest fastener exporter in ASEAN. The global fastener export of major
ASEAN countries grew except for the Philippines. The top three ASEAN countries
with the highest compound growth rate of fastener export in the past four years wereIndonesia (14.8%) , Vietnam (14.4%), and Thailand (6.9%).

3. Current Development of Vietnamese Fastener
Industry(a) Vietnam’s performance in the global fastener market
Table 3 shows the import and export trade of Vietnamese fastener industry withthe world and Taiwan from 2018 to 2022. In 2022, Vietnam’s import value of fasteners
from the world were US$731 million (approximately NT$21.77 billion). The compound
growth rate over the past five years was 5.7%, and the value of fasteners exported to
the world was US$681 million (approximately NT$ 20.28 billion), with the compound
growth rate over the past five years at 9.7%. On Taiwan’s fastener trade with Vietnam,
Taiwan’s export to Vietnam increased year by year from US$53 million to US$59 million(approximately NT$1.76 billion) from 2018 to 2022, with a compound growth rate overthe past five years at approximately 2.4%. However, the export share dropped from9.1% to 8.0%, and the compound growth rate of the share dropped 3.2%, indicating thatcompetitors are gradually encroaching on Taiwan’s share in Vietnam.
惠達雜誌 Fastener World no.206/2024

233

Industry Focus
Unit: 100 Million US dollars; %Table 1. Major ASEAN Countries Importing Fastener Products from the World from 2019 to 2022
Coutries
Thailand
Vietnam
Malaysia
Indonesia
Singapore
Philippines
Other ASEANCountries in Total
ASEAN in Total
Global Total

2019
10.39
5.76
3.95
5.38
4.10
1.44

2020
8.86
6.23
3.81
3.33
3.60
1.33

2021
11.42
7.56
5.23
4.80
4.38
1.87

2022
11.06
7.31
6.05
5.89
4.83
1.99

Share in ASEAN
29.0%
19.2%
15.9%
15.4%
12.7%
5.2%

CAGR
2.1%
8.3%
15.3%
3.0%
5.6%
11.3%

1.01

1.27

0.97

1.02

2.7%

0.3%

32.03
427.4428.42
383.2636.23
483.2838.14
535.06100.0%
--

6.0%
7.8%

Unit: 100 Million US dollars; %Table 2. Major ASEAN Countries Exporting Fastener Products to the World from 2019 to 2022
Countries
VietnamThailandSingapore
Malaysia
Philippines
Indonesia
Other ASEANCountries in Total
ASEAN in Total
Global Total

2019
4.55
5.46
3.17
2.98
1.65
0.77

2020
4.53
4.36
2.96
2.70
1.07
0.77

2021
5.38
5.97
3.29
3.64
1.43
0.97

2022
6.81
6.67
3.69
3.55
1.40
1.17

ASEAN share
29.2%
28.6%
15.8%
15.2%
6.0%
5.0%

CAGR
14.4%
6.9%
5.2%
6.0%
-5.2%
14.8%

0.00

0.01

0.03

0.05

0.2%

127.9%

18.58
400.5516.40
368.6920.70
461.7323.34
504.45100.0%--7.9%
8.0%

Unit: 100 Million US dollars; %Table 3. Import and Export Trade of Vietnamese Fastener Industry with the World and Taiwan from 2018 to 2022
Product Category
Value of Vietnam’s fastener
import from the world
Value of Vietnam’s fastenerexport to the world
Value of Vietnam’s fastener
import from Taiwan
Proportion of Vietnam’s fastener
import from Taiwan
Value of Vietnam’s fastenerexport to Taiwan
Proportion of Vietnam’s fastenerexport to Taiwan

20182019

2020

2021

2022

CAGR

5.85

5.76

6.23

7.56

7.31

5.7%

4.71

4.55

4.535.38

6.81

9.7%

0.53

0.49

0.51

0.58

0.59

2.4%

9.1%

8.4%

8.1%

7.6%

8.0%

-3.2%

0.04

0.05

0.04

0.06

0.05

3.0%

0.9%

1.1%

0.9%

1.0%

0.7%

-6.1%

Data source: Compiled by ITC/MIRDC(b) Vietnam's fastener trade partners andtrade value proportions
Table 4 is the top 10 fastener trading partners with Vietnam in 2022.
in terms of import, the top three import sources for Vietnam were
China (US$358 million, accounting for 49.0%), Japan (US$120 million,accounting for 16.4%), South Korea (US$88 million, accounting for12.1%). Taiwan was Vietnam’s fourth largest source (US$59 million,accounting for 8.0%). China alone accounted for nearly 50%. The top
10 import sources accounted for more than 95%, indicating a highly
concentrated market structure. In terms of export, Vietnam's top 3
fastener export destinations were Germany (US$135 million, accountingfor 19.8%), the United States (US$119 million, accounting for 17.5%),and Japan (US$75 million, accounting for 11.0 %). The top 10 export
destinations accounted for nearly 80% of the total, which also
indicates a highly concentrated market structure.

234Fastener World no.206/2024 惠達雜誌(C) Vietnam’s Import of Various Fastener
Products
Table 5 shows Vietnam's fastener import from the world by
product category from 2019 to 2022. The values and compound
growth rates of the top 3 fastener categories imported by Vietnam
from the world in 2022 were: other iron or steel screws and bolts(US$277 million, 37.9%), other iron or steel washers (US$116million, 15.8%), and iron or steel nuts (US$98 million, 13.4%).
In the past four years, the proportion of top 5 imported fastenerproducts (all of which being critical items) accounted for nearly
90%. The top 3 fastener products with the highest compound
growth rates in the past four years were iron or steel self-tapping
screws (27.4%), other iron or steel screws and bolts (15.1 %), ironor steel springs and lock washers (11.8%).

Industry Focus(D) Vietnam’s Export of Various Fastener Products

Table 6 shows Vietnam's fastener export to the world by product category from 2019 to 2022. The values and compound growth rates ofVietnam’s top 3 fastener products exported to the world in 2022 were other iron or steel screws and bolts (US$434 million, 63.7%), iron orsteel self-tapping screws (US$0.53 billion, 7.7 %), iron or steel wood screws (US$ 49 million, 7.2%). Other types of iron or steel screws andbolts were the top export items, and their export values far exceeded those of iron or steel self-tapping screws which ranked second in export.
The top 3 fastener products with the highest compound growth rate in the past four years were other iron or steel threaded products (38.1 %),steel rivets (36.8%), and iron or steel automotive screws (36.5%). Although the export value of some items was not high, the high compound
growth rate could mean that Vietnam’s product quality and production efficiency has improved, and that overseas customer demand issteadily increasing. These factors are worth the attention.
Unit: 100 Million US dollars; %Table 4. Top 10 Fastener Trading Partners with Vietnam in 2022
Import Sources
ChinaJapanS. Korea
TaiwanThailandUSA
GermanyItaly
Malaysia
Singapore
Subtotal of top 10 import sources
Total of other import sources
Total

Import
Value
3.58
1.20
0.88
0.59
0.23
0.21
0.15
0.07
0.05
0.04
7.00
0.31
7.31

ImportProportion
49.0%
16.4%
12.1%
8.0%
3.1%
2.9%
2.0%
1.0%
0.7%
0.5%
95.8%
4.2%
100.0%

Export Destinations
ChinaJapan
S. Korea
TaiwanThailandUSA
Germany
Italy
Malaysia
Singapore
Subtotal of top 10 export destinations
Total of other export destinations
Total

Export
Value
1.35
1.19
0.75
0.70
0.33
0.30
0.23
0.22
0.18
0.15
5.39
1.42
6.81

ExportProportion
19.8%
17.5%
11.0%
10.3%
4.8%
4.4%
3.4%
3.2%
2.6%
2.3%
79.2%
20.8%
100.0%

Unit: 100 Million US dollars; %Table 5. Vietnam's Fastener Import from the World by Product Category from 2019 to 2022
Product Category
Other iron or steel screws and bolts
Other Iron or steel washers
Iron or steel nuts
Iron or steel cotters and cotter pins
Other types of iron or steel non-threaded products
Other iron or steel threaded products
Iron or steel rivets
Iron or steel self-tapping screws
Other iron or steel wood screwsIron or steel spring washers and lock washers
Iron or steel automotive screws
Iron or steel screw hooks and screw rings
Total

HS Code731815731822731816731824731829731819731823731814731812731821731811731813

2019
1.82
1.19
0.76
0.58
0.59
0.49
0.14
0.05
0.06
0.05
0.02
0.01
5.76

2020
2.12
1.10
0.81
0.63
0.66
0.53
0.13
0.07
0.08
0.05
0.02
0.01
6.23

2021
2.73
1.18
0.94
0.77
0.98
0.51
0.17
0.09
0.09
0.06
0.02
0.01
7.56

2022
2.77
1.16
0.98
0.74
0.70
0.53
0.15
0.11
0.08
0.06
0.02
0.01
7.31

Proportion CAGR
37.9%
15.1%
15.8%
-1.0%
13.4%
9.2%
10.1%
8.1%
9.6%
6.0%
7.3%
2.7%
2.1%
1.5%
1.5%
27.4%
1.1%
9.3%
0.9%
11.8%
0.3%
7.7%
0.1%
-16.2%
100.0%
8.3%

Unit: 100 Million US dollars; %Table 6. Vietnam's Fastener Export to the World by Product Category from 2019 to 2022
Product Category

Other iron or steel screws and bolts
Iron or steel self-tapping screws
Other iron or steel wood screws
Other iron or steel threaded products
Iron or steel cotters and cotter pins
Other iron or steel washers
Iron or steel nuts
Other non-threaded iron or steel products
Iron or steel rivets
Iron or steel spring washers and other locking washers
Iron or steel automotive screws
Iron or steel screw hooks and screw rings
Total

HS Code731815731814731812731819731824731822731816731829731823731821731811731813

2019
2.84
0.36
0.36
0.14
0.22
0.17
0.17
0.27
0.01
0.01
0.00
0.00
4.55

2020
2.75
0.39
0.40
0.15
0.23
0.17
0.16
0.27
0.01
0.01
0.00
0.00
4.53

2021
3.25
0.39
0.46
0.29
0.28
0.23
0.21
0.25
0.01
0.01
0.00
0.00
5.38

2022
4.34
0.53
0.49
0.36
0.29
0.29
0.25
0.24
0.02
0.01
0.00
0.00
6.81

Proportion CAGR
63.7%
15.2%
7.7%
13.9%
7.2%
11.0%
5.3%
38.1%
4.2%
9.1%
4.2%
18.7%
3.6%
12.3%
3.5%
-4.3%
0.3%
36.8%
0.2%
7.9%
0.0%
36.5%
0.0%
-34.8%
100.0%
14.4%

Data source: Compiled by ITC/MIRDC

惠達雜誌 Fastener World no.206/2024

235

Industry Focus
4. Current Development ofFastener-Related Industries inVietnam(a) Foreign investment in Vietnam andstatus of fastener-related industries
Foreign investment and fastener-related industries inVietnam include local infrastructure, motor vehicles andcomponents, metal processing, electronic appliances,construction industry, etc. The main source of foreign
investment and fastener-related fields in Vietnam areJapan (motor vehicles and machinery), China (motorveh icles), a nd t he Un it ed St at es (veh icle -relat ed
metal machinery and electrical appliances industry);
Distinguished by geographic location, metal processing
is located in North Vietnam, Central Vietnam is largely
represented by Formosa Ha Tinh Steel plant, and steel andmotor vehicle components are located in South Vietnam.
In addition, the fastener-related industries invested by
Taiwanese businessmen in Vietnam include steel, nonferrous metal materials, metal products, construction, etc.,
most of which are conventional small and medium-sized
manufacturing industries.

(b) Fastener-related infrastructure inVietnam
The infrastructure projects expected to be built in the"2021-2025 Five-Year Plan" launched by the Vietnamese
government in 2021 include building 9 new railways(including high-speed railways), updating 7 railways,
and building and expanding dozens of highways. Ho Chi
Minh City alone is expected to build approximately 454
kilometers of highways, ring roads, national highways andlarge bridges, with a total investment of US$11.5 billion.
In terms of industrial parks, 61 of Vietnam's 63 provinces
and cities establish industrial parks and economic zones,
including 403 industrial parks, 18 coastal economiczones, and 26 port economic zones, of which Dong Nai
Province has the largest number of industrial parks andis continuing to increase and improve related facilities.
In the next five years, the Vietnamese government will
invest more than US$139 billion in building stations,airports, ports, highways, railways, power plants andother infrastructure.

5. Conclusion
There is a gap bet ween Viet nam and Taiwan ineconomic development. Taiwan's fasteners have long been
mainly exported to European and American countries,
and Vietnam is not one of the main export destinations
for Taiwan’s fasteners. However, Vietnam has geographic
advantages and possesses the tariff-free advantage underglobal FTAs. Vietnam has many potential industries for
future development. The following are suggestions for thedevelopment of Taiwanese fastener manufacturers in theVietnamese market:(a) Get in line with the Vietnamese government'sindustrial development policy: In addition to thehuge demand for Vietnams future infrastructure
construction mentioned above, the "Socioeconomic

236

Fastener World no.206/2024 惠達雜誌Development Strategy from 2021 to 2030" launched by the Vietnamese
government will focus on AI, semiconductors and automobileindustries. The government will also construct facilities and digital
infrastructure involved with digital economy and smart cities (mainly
Ho Chi Minh and Da Nang). These are the potential markets that
Taiwanese fastener companies can further study in the future.
(b) Use Vietnam as a test site to connect with the world: The primary
production lines of Taiwanese fastener industry are all located inTaiwan. It is unlikely for Taiwanese companies to move their primary
fastener production lines to Vietnam. However, Vietnam has theadvantages of connection with the international market and tariff-freeexport; and therefore, Taiwanese fastener companies can think about
making Vietnam a test ground for trial production of small quantities
of various fastener products for international manufacturers. In
addition to connecting with international manufacturers and gaining
orders, and supplying local demand nearby, they can bring market
intelligence, production experience and know-how back to Taiwanese
fastener industry.
(c) Hop on Vietnam's carbon reduction trend to expand the market: TheVietnamese government's Environmental Protection Law, which tookeffect in 2022, proposed reducing carbon emissions and developing
a carbon trading market to make way for EVs to become Vietnam’stransportation vehicles. Vietnam sells 50,000 to 60,000 units of EVs(excluding electric bicycles) annually. Taiwan is more technologicallyexperienced in EV than Vietnam and has more vehicle components
and battery manufacturers. Therefore, Taiwan has a competitiveedge breaking into the Vietnamese market. Taiwanese fastener
manufacturers can think about supplying critical EV components,
EV fasteners and fastening tools in Vietnam, collaborating withVietnamese EV companies to develop the local market.
(d) Integrate the industrial chain of Taiwanese companies in Vietnam:
Taiwanese fastener companies can cooperate with local Taiwanesebusinessmen to integrate the upstream and downstream industrial
chains, and produce low-tech, labor-intensive products in Vietnam
through technical collaboration or joint ventures, and ship them backto Taiwan to assemble and re-export, taking advantage of international
division of labor.
Copyright owned by Fastener World / Article by Dr. Arthur Hsu