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From the beginning of the year until now, amongst one newly established enterprise, three firms announced that they filed for bankruptcy protection. Therefore, Vietnamese enterprises not only need the support of state management agencies but they themselves should collaborate with others to be stronger as well.
In general, many enterprises have operated stably present while some businesses are running around looking for orders. Mr. Tran Viet Anh, General Director of Thai Son Nam Trading Company, said that the company's plastic orders can still manage until the end of April.
Similarly, Ms. Nguyen Thi Loan, Deputy General Director Director of Industrial Engineering and Construction Company (IME), said that from the end of 2022, the company has negotiated and signed an export contract worth US$1.7 million with a partner in Europe.
However, many textile manufacturing companies are still struggling to find orders. For example, Viet Thang Jean Company is still producing in moderation, waiting for a better market sign which was forecast in June. Worse, Thanh Dat Garment Company has not yet received product orders.
Mr. Vu Duc Giang, Chairman of the Vietnam Textile and Apparel Association, said that from October to December each year, textile and garment enterprises will receive enough production orders for the next six months or years. However, so far, very few businesses can receive long-term orders.
According to Mr. Vu Duc Giang’s explanation, Vietnamese enterprises are slow in shifting to green production. He pointed out that while Vietnamese enterprises are thirsty for orders, textile enterprises in Bangladesh still keep stable orders because Bangladeshi enterprises have transformed production, catching up with the trend of green consumption and green trade globally. Therefore, they will not be affected much even if the purchasing power is slightly reduced.
Meanwhile, the green transformation of the textile and garment industry in Vietnam is still quite slow. Even many businesses are too confident with long-term partners, stable orders, and competitive prices available, so they refuse to convert green. This is also the reason why Vietnamese textile and garment enterprises lack orders, said Mr. Vu Duc Giang.
Statistics from the Ministry of Industry and Trade show that the proportion of Vietnam's export turnover to key export markets such as Europe, the US, Canada, Mexico, and Australia, is just under 5 percent compared to the import needs of the countries. As a result, enterprises need to learn what their partners from many different markets need to have a long-term plan to ensure stable production activities.
Sharing more about this issue, Mr. Ngo Xuan Nam, Deputy Director of Viet Nam Sanitary and Phytosanitary Notification Authority and Enquiry Point (Vietnam SPS for short) under the Ministry of Agriculture and Rural Development emphasized that all export markets have set up technical barriers; therefore, enterprises must meet technical barriers of quality standards, food safety and hygiene and green trade trends if they want to maintain sustainable exports.
For instance, from the beginning of 2023, the European Union (EU) has reduced the frequency of sample testing for many Vietnamese exports from 100 percent, 50 percent and 20 percent, and has not applied official control measures as before. This has created favorable conditions for Vietnamese exports to accelerate their presence back in this market. Before, because many Vietnamese products did not meet food safety and hygiene standards, strict control measures were applied, affecting exports from all Vietnamese enterprises.
In order to help businesses overcome difficulties, Minister of Industry and Trade Do Thang Hai directed trade counselors in foreign markets, especially in the main export markets of Europe, the US, Canada, Australia, and Dubai, to look for orders by connecting domestic and foreign enterprises. Vietnamese enterprises have linked together to be stronger. As per schedule, five associations including the Vietnam Wood and Forest Products Association, the Ho Chi Minh City Handicraft and Woodworking Association, the Binh Duong Province Wood Processing Association, the Wood and Crafts Association in Dong Nai Province, and the Binh Dinh Wood and Forest Products Association and related associations jointly organize an export fair of wooden furniture and furniture in Ho Chi Minh City.
Furthermore, the Ho Chi Minh City Business Association, retail systems Saigon Co.op and Satra are making efforts to support domestic enterprises by sharing orders with each other with the aim to expand the domestic consumption market and improve quality standards to increase exports.
