Workers produce electronic components (Photo: VNA) Hanoi (VNA) - The COVID-19 pandemic has disruptedglobal supply chains and exposed many large foreign investors in Vietnam tomaterial shortages, and in response a number of domestic firms in supportindustries have taken the opportunity to become important “links” within thosechains.
Do Phuoc Tong, Chairman of the HCM CityAssociation of Mechanical-Electrical Enterprises, said a host of manufacturershave encountered disruptions in the supply of equipment from China, which hasbeen hit hard by COVID-19. This prompted them to switch to local suppliers to obtainalternative inputs, especially mechanical-electrical equipment and moulds.
Many domestic companies in support industrieshave received more orders and are operating at full capacity, he noted.
To meet partners’ standards, they have reorganisedproduction and view this as a chance to assure partners, particularly major foreignenterprises, of their product quality and gain a foothold in the market.
The HCM City-based mould producer the Lap PhucCo. Ltd has posted an increase of 10-20 percent in orders, most of which are fromforeign enterprises with factories in Vietnam.
Meanwhile, the An Phat Industrial Technology Co.Ltd in southern Dong Nai province has also accelerated production and introducedovertime as orders have increased 20-30 percent.
Le Tri Minh, head of the Dong Nai association ofenterprises in support industries, said a number of members have received 30-40percent more orders year-on-year, primarily from foreign enterprises.
He noted that manufacturers are short of materialsnormally imported from China, so have sought local suppliers.
Vietnamese companies in support industries,however, are also concerned about a shortage of input materials such as ironand steel, especially those in the machinery industry, and certain types of steelmust still be imported even though local providers have already ensured arelatively large supply.
Tong suggested that, in the long term, enterprisesin support industries should ensure product quality, competitive prices, andpunctual delivery to maintain their newly-found partners.
They also need to connect with each other, sincemany products from one company may be input materials for another. This wouldhelp them boost domestic supplies and reduce dependence on imports, he added./.
VNA
