Illustrative photo (Source: VNA) HCM City (VNA) - Vietnamesemanufacturers and exporters are struggling to cope with rising material pricesdespite posting high export volumes in the first four months of the year.
Datafrom the General Statistics Office (GSO) show that exports were estimated at 103.9billion USD during the period, up 28.3 percent year-on-year. Up to 19 types of goodsearned more than 1 billion USD in export revenue each, or 84.5 percent of thetotal.
Asof late April, garment exports were up 9 percent year-on-year to 9.5 billionUSD while footwear shipments had hit 6.4 billion USD, an 18.7 percent increase.
The Ministry of Industry and Trade has forecast that exports and imports willcontinue to thrive in the near future as new free trade agreements withpreferential tariffs are implemented, including the Comprehensive andProgressive Agreement for Trans-Pacific Partnership (CPTPP), the EU-VietnamFree Trade Agreement (EVFTA), and the UK-Vietnam Free Trade Agreement (UKVFTA).
Companies, however,face challenges caused by rising material and transportation costs as well as theuncertainties over COVID-19 in the region.
Nguyen Quoc Anh, Director of the Duc Minh Rubber Company and Chairman of the Ho Chi Minh City Rubber Plastic Manufacturers Association, said that since early thisyear the price of materials, chemicals, and rubber additives have soared 60percent and show no signs of stabilising.
Many partners are hesitant to place orders and arewaiting for prices to decline. Meanwhile, if companies were to sell their productsat previous prices they would incur losses despite rising volumes, he said.
Experts have suggestedbuilding industrial zones designed exclusively for manufacturing apparel andfootwear materials as well as devising a strategy to develop the supply ofdomestically-made materials for production and export, thus helping firmscontrol costs and tap the advantages contained in free trade deals./.
