The role of manufacturing industry in economy: the case of the southern in Vietnam

Vu Thi Kim Hanh^1* & Vo Thi Le Uyen^2,3

¹Van Lang University, Ho Chi Minh City, Vietnam

²University of Economics and Law, Ho Chi Minh City, Vietnam

³Vietnam National University, Ho Chi Minh City, Vietnam

Abstract

The methodology is Path analysis model. The objective is to study how Index of Industrial Production (IIP) of five City-provinces in the Southern in Vietnam effect each other on these City-provinces’ GDP. How GDP of each City-province effects on Vietnam’s GDP. Results are Vietnam’s GDP is positively indirectly effected by IIPs of Ho Chi Minh, Binh Duong, Binh Phuoc, Tien Giang and is negatively affected by Tay Ninh’ s IIP. Besides, while GDP and IIP of Tay Ninh have negative general effect on GDP and IIP of other City-provinces and GDP of Vietnam, GDP and IIP of Binh Phuoc have the strongest general effect on GDP and IIP of other City-provinces and GDP of Vietnam. Next, GDP and IIP of Binh Duong have the second strongest general effect, GDP and IIP of Ho Chi Minh are the third strongest general effect, GDP and IIP of Tien Giang have the smallest general effect on GDP and IIP of other City-provinces and GDP of Vietnam. Therefore, we suggest that Tay Ninh should have a specific support mechanism. In particular, promoting development of science and tech in Ho Chi Minh to achieve the “spillover effect” to the other four City-provinces.

Keywords

manufacturing industry; economic region; IIP; index of industrial production.

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