Workers at a textile factory in Vietnam (Photo: VNA)HCM City (VNS/VNA) - Vietnamese companies, manyof whom are facing a shortage of feedstock and raw materials as a result of thenew coronavirus (COVID-19) outbreak in China, have started looking atalternative sources.
The epidemic has had a significant impact on public health,transportation, tourism, education, and, importantly, trade and commerce,experts said.
It has affected Vietnam’s trade not only with China but alsoother markets, and started hurting Vietnamese businesses.
According to the Department of Import and Export under theMinistry of Industry and Trade, the impacts include prolonging delivery timesand customs clearance due to the quarantine requirements on both sides.
In addition, trade by road, rail and air with China hasslumped.
With Chinese goods not available, Vietnam has been unable tosource imports, which has affected its production and exports to third markets.
Many textile and footwear enterprises are therefore lookingat raw material imports from other markets such as the Republic of Korea,India, Bangladesh, and Brazil.
Pham Xuan Hong, President of the Ho Chi Minh City TextileAssociation, said this would only be a temporary solution since China could notbe replaced as the main supplier by anyone else due to its much lower costs.
Truong Van Cam, Vice Chairman and Secretary General of theVietnam Textile and Apparel Association (Vitas), said the textile industrysources a significant proportion of feedstock from China.
The epidemic has caused Chinese businesses to shut downproduction, especially in Wuhan, where there are a number of large factories,he said.
Since many textile plants in China are likely to be closeduntil the end of February or even longer, supply to Vietnam would be hard hit,he said.
If the epidemic continues for the next one or two months, theglobal economy, including Vietnam, would be in trouble, he warned.
But this is also an opportunity for Vietnamese businesses tolook for other sources to relinquish their dependence on China, he pointed out.
Other countries like Thailand, India and Indonesia are alsolooking for other markets to source raw materials from to reduce theirdependence on China, he said.
Companies, especially small and medium-sized enterprises,need Government support in the form of preferential loans and access to newtechnologies to sustain their business, he added.
Vitas has asked members for reports on the impact of theoutbreak on their operations and instructed them to follow developments.
It urged businesses to focus on the domestic market and fromother markets to sustain themselves and ensure workers are not affected.
Do Thi Thuy Huong of the Vietnam Electronics IndustriesAssociation said most enterprises in her industry are expected to be hit hardin the next one or two months, and face the risk of delaying payments toworkers and stopping production.
Tran Thanh Hai, Deputy Director of the Ministry of Industryand Trade’s Import and Export Department, said the ministry has worked with theMinistry of Health to take measures against the epidemic, but they would notimpact trade.
Recently a number of credit institutions offered to earmarkfunds to meet credit demand from customers affected by the outbreak./.
The epidemic has had a significant impact on public health,transportation, tourism, education, and, importantly, trade and commerce,experts said.
It has affected Vietnam’s trade not only with China but alsoother markets, and started hurting Vietnamese businesses.
According to the Department of Import and Export under theMinistry of Industry and Trade, the impacts include prolonging delivery timesand customs clearance due to the quarantine requirements on both sides.
In addition, trade by road, rail and air with China hasslumped.
With Chinese goods not available, Vietnam has been unable tosource imports, which has affected its production and exports to third markets.
Many textile and footwear enterprises are therefore lookingat raw material imports from other markets such as the Republic of Korea,India, Bangladesh, and Brazil.
Pham Xuan Hong, President of the Ho Chi Minh City TextileAssociation, said this would only be a temporary solution since China could notbe replaced as the main supplier by anyone else due to its much lower costs.
Truong Van Cam, Vice Chairman and Secretary General of theVietnam Textile and Apparel Association (Vitas), said the textile industrysources a significant proportion of feedstock from China.
The epidemic has caused Chinese businesses to shut downproduction, especially in Wuhan, where there are a number of large factories,he said.
Since many textile plants in China are likely to be closeduntil the end of February or even longer, supply to Vietnam would be hard hit,he said.
If the epidemic continues for the next one or two months, theglobal economy, including Vietnam, would be in trouble, he warned.
But this is also an opportunity for Vietnamese businesses tolook for other sources to relinquish their dependence on China, he pointed out.
Other countries like Thailand, India and Indonesia are alsolooking for other markets to source raw materials from to reduce theirdependence on China, he said.
Companies, especially small and medium-sized enterprises,need Government support in the form of preferential loans and access to newtechnologies to sustain their business, he added.
Vitas has asked members for reports on the impact of theoutbreak on their operations and instructed them to follow developments.
It urged businesses to focus on the domestic market and fromother markets to sustain themselves and ensure workers are not affected.
Do Thi Thuy Huong of the Vietnam Electronics IndustriesAssociation said most enterprises in her industry are expected to be hit hardin the next one or two months, and face the risk of delaying payments toworkers and stopping production.
Tran Thanh Hai, Deputy Director of the Ministry of Industryand Trade’s Import and Export Department, said the ministry has worked with theMinistry of Health to take measures against the epidemic, but they would notimpact trade.
Recently a number of credit institutions offered to earmarkfunds to meet credit demand from customers affected by the outbreak./.
VNA
