Reshaping the World’s Supply Chain? A Case Study of Vietnam’s PAN Group Adopting the Circular Economy Concept

Tung Bui, Quan Vu Le, and Jason Nguyen

Presented at the BASC Indo-Pacific Geo-Economic Competition Conference, Sponsored by the Center for Global Partnership

As a repercussion of the Sino-American trade war and the global outbreak of the COVID-19 pandemic, major economies are seeking ways to reduce dependence on China’s production prowess. A much touted reaction is the relocation of manufacturing activities of multinationals out of China. East Asian economies, including Vietnam, are actively lobbying industrialized economies to consider them as alternate or expanded suppliers in the new global supply chain system. We argue that the current relocation of factories is at best a political move that might soothe the current protectionism mood, and at worst an inefficient business decision. We advocate that the reshaping of the global supply system would be best achieved by engaging all members of the supply chain to embrace the Circular Economy (CE) core principles to ensure a sustainable and equitable economic and social development, both locally and globally. We present a case study of the PAN Group, a young, unconventional, and growing 17,000-farmers strong agricultural group in Vietnam that has been aggressively taking strategic moves toward the circular economy. The early success of the PAN Group in assisting a variety of independent farms and food industries across the country to innovate and, by doing so, enabling them to join the global economy in a self-reliant and resilient manner has caught the attention of the Vietnamese government. The latter sees the PAN Group as an integral part of its CE national policy in promoting public-private-partnership (PPP). Throughout the case analysis, we discuss the feasibility, opportunities and challenges of an economy in search of a new path to join the future world’s supply chain.

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