On the morning of February 7, leaders of Import and Export Department (Ministry of Industry and Trade) chaired a meeting with representatives of Vietnam Textile and Apparel Association, Vietnam Cotton and Yarn Association, Vietnam Leather and Footwear Association and Association. Vietnam Electronics Business Association, Vietnam Steel Association, Samsung Group to assess the impact on the business of the industry when raw materials, components and components imported from China difficulty; assess the impact on export activities of the industry to China and other markets; difficult and entangled issues of the commodity line in case of complicated epidemics. Attending the meeting, there were representatives of Planning Department, Asia-Africa Market Department, Europe-America Market Department, Industry Department.
Epidemic respiratory infection caused by new strain of corona virus (nCoV) has a comprehensive impact on all aspects from health, transportation, tourism, education, trade … However, this epidemic has an impact on Vietnam’s import and export activities not only limited to direct trade relations with China but also in third markets. , import, border trade to domestic trade, industrial production, supply chain management.
Some impacts can be indicated as: prolonging delivery time, customs clearance due to strict medical quarantine at both ends (export and import); trade by road, rail and air between the two countries is limited; import demand for Chinese consumption and production decreased. Regarding imports into Vietnam, some difficulties may occur when the source of goods from China decreases, which may affect production and export activities to third markets. On the balance between supply and demand, there may be shortage / excess of certain commodities.
Recently, the Ministry of Industry and Trade has collaborated with other ministries, departments and agencies to implement specific actions to support businesses to cope with the nCoV epidemic. Recently, on February 5, 2020, Deputy Minister Tran Quoc Khanh signed the Document No. 709 / BCT-XNK to Vietnam Association of Logistics Services Enterprises (VLA): requesting VLA to encourage its members to join hands. efforts and support measures such as reducing warehousing costs, transportation costs, loading and unloading goods … so that distribution businesses, trade centers and supermarkets can increase purchasing of agricultural products. for farmers.
On February 5, 2020, the Government Office issued Official Letter No. 808 / VPCP-KTTH on the activities of importing, exporting and transporting goods across borders, in which the Prime Minister instructed: Export, import and transportation of goods across borders continue to comply with regulations; to ensure the prevention of epidemics, without interrupting and affecting production and business activities of enterprises. Drivers of vehicles transporting goods (without passengers) across the border, flight crew, crew from the epidemic area are allowed to enter and exit across the border (including international border gates, national border gates of roads ministries, seaways, railways, air routes) but must apply strict and strict epidemic prevention, management and health control measures; only going to the place of goods delivery and receipt, the isolation point at the border gate area, not allowed to go deep into the inland; ensure the complete elimination of risks of disease transmission ”.
At the meeting, Mr. Truong Van Cam – Vice Chairman cum General Secretary of Textile and Apparel Association said that the material source of textile industry has a significant proportion from China. The occurrence of the nCoV epidemic has caused many businesses to shut down their raw materials and production, especially Wuhan, a city with many large factories, so the risk of lack of raw materials in the near future is very high. Therefore, although the export market of the garment industry is less affected, but because many textile factories in China may close in February, the input – the supply of raw materials – will be affected.
To cope with the worst case scenario, a number of textile and footwear enterprises are considering plans to import raw materials from other countries such as Korea, India, Bangladesh, Brazil … to offset the source. Shortage of raw materials for production. However, the current difficulty is that transferring raw materials to other countries is not easy, especially comparing the advantage of unit price, Chinese customers are always lower than other countries, so it will be very hard to compete. If the disease cannot be extinguished in the next 1-2 months, the global economy and Vietnam will face difficulties. However, this is also an opportunity for domestic enterprises to continue to source raw materials from other markets. This has been done by businesses in Thailand, India or Indonesia to reduce the dependency on raw materials from China. However, due to the current situation, about 90% of domestic enterprises are small and medium-sized, so in addition to the initiative of enterprises, it is necessary to have the support of mechanisms and policies of the State. By now, some difficulties that businesses are in need of support such as preferential loans, support packages to access new technologies, and policies to support technological innovation. Or is it necessary to support the output from national key trade promotion programs of the Government, instead of just promoting, connecting and providing general information.
Prior to the current developments, the Vietnam Textile and Apparel Association (Vitas) has announced to request its member businesses to send reports on the impact of the nCoV epidemic to the production and business situation for Vitas to summarize and report to the Government. In order to minimize the negative impacts on production and business activities, Vitas recommends that businesses need to discuss with customers, focusing on exploiting domestic raw materials and auxiliary materials or from other countries to replace auxiliary materials. Imported materials from China, ensuring maintenance of production and business, stabilizing the lives of workers.
Representative of Vietnam Electronics Business Association, Ms. Do Thi Thuy Huong said: Only in 1-2 months will see clearly the impact of the disease. The risk of stopping production is very high, the payment of salaries for workers, plus the cost of maintaining and maintaining machinery is also a big amount.
Samsung representatives also asked the Government of Vietnam to assist businesses in coordinating with the Chinese Government to facilitate exchange of customs clearance for imported goods at road border gates.
Deputy Director of Import and Export Department (Ministry of Industry and Trade), Mr. Tran Thanh Hai said, Ministry of Industry and Trade was very aware and shared with the difficulties of enterprises. Recently, the Ministry of Industry and Trade had a discussion with the Ministry of Health towards implementing drastic measures against epidemics and epidemic prevention, but still ensuring that the measures given do not cause undue difficulties to the delivery. love. We accept to lose time but not to waste time unreasonably, Mr. Hai emphasized.
In the afternoon of the same day, Minister of Industry and Trade Tran Tuan Anh chaired a meeting to implement the Industry and Trade sector’s response measures to nCoV. Business information, industry associations reflecting, proposing and recommendations in the morning meeting on February 7 will be summarized and reported by the Import and Export Department and reported to the Ministry’s leaders.
