The pandemic has caused a lot of difficulties for enterprises in Vietnam, especially industrial enterprises. (Photo: congthuong.vn) Hanoi (VNS/VNA) - The Ministry of Industry andTrade (MoIT) said that the most important priority at present was to maintainthe operation of domestic industrial enterprises during the COVID-19 pandemic.
The pandemic has caused a lot ofdifficulties for enterprises in Vietnam, especially industrialenterprises. If an enterprise is closed due the pandemic, its workers losetheir jobs and it has negative impacts on other businesses in the supply chain.
According to the ministry, many key industrial sectorshad suffered greatly from the COVID-19 pandemic, especially electronics,textiles, leather, footwear and furniture.
The textile, garment, leather and footwear industries havesuffered due to a decline in demand in the US and European markets, whichhas had strong impacts on national export value.
New orders in April and May are expected to fall byabout 70 percent. The ministry predicted that the likelihood of neworders this year end was low.
Enterprises were also facing problems at home becausedomestic demand was decreasing due to the pandemic.
The ministry suggested the Government implement three basicsolutions to maintain operations at local industrial enterprises.
The Government needs to reduce the time and cost ofcustoms clearance for businesses so they could access imported rawand auxiliary materials quickly, especially for large enterprises andenterprises in key industries such as electronics, automobiles, textiles,garments, leather and footwear, according to the ministry.
In addition, the State should have practical supportpolicies on credit and tax to help businesses ensure production, whilehelping find new markets at home and abroad for the industrial sector,mainly export markets for key industrial products.
For the textile, garment and footwear industries, theministry has recommended the Government allow extensions of payment deadlinesfor corporate income tax and value added tax.
It should also permit extensions of payment deadlinesand exemptions or reductions for land rental fees, industrial parkinfrastructure fees and waste water treatment fees during the pandemic.
The ministry has asked the Government to considera support package for corporate income tax for small- andmedium-sized enterprises, especially in support industries and labour-intensiveindustries such as textiles, garments, leather and footwear.
Banks are also suggested reducing deposits andinternational payment fees for enterprises importing raw materials so they canaccess capital and resume manufacturing. The banks should extend termsfor working loans to 11 months.
To implement these support solutions, the ministrysuggested that other ministries, sectors and localities should acceleratethe equitisation and divestment of capital in State-invested enterprises toincrease budget revenue.
According to the Vietnam Electronic Industries Association,long-term and new export contracts would be few and far between dueto the declining demand for electronic products due to lower demand fromthe US and European markets.
The domestic furniture production industry was noexception because the US and Europe were key markets accounting for 58 percentof Vietnam’s total furniture exports.
The Vietnam Timber and Forest Product Associationreported that exports of timber and wooden products wouldfall significantly in the next three-six months due to theimpacts of COVID-19. That could lead enterprises to cut 70 percent ofcapacity and even temporarily suspend production.
Some enterprises producing wooden products for the domesticmarket would only be able to operate at about 10-15 percent of their capacity./.
VNA
