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Vietnam looks to bolster ties with overseas markets to help coronavirus-stricken firms

Tuesday, May 05, 2020, 16:18 GMT+7
Vietnam looks to bolster ties with overseas markets to help coronavirus-stricken firms
Vietnam's Minister of Industry and Trade Tran Tuan Anh (right) speaks to a representative of a local garment firm that manufactures face masks. Photo: M. Khang / Tuoi Tre

Authorities are taking various measures to boost trade ties with overseas markets to help local firms get out of difficulties, due to the devastating impacts of the novel coronavirus disease (COVID-19) pandemic on their imports and exports.

In a report on Vietnam’s industrial production and trade between January and April this year, the Ministry of Industry and Trade provided insights into the adverse effects of the virus crisis on the country’s manufacturing industries.

The ministry cited the General Statistics Office as saying the country’s index of industrial production in April dropped by around 13.3 percent from a month earlier and fell by 10.55 percent from a year ago.

Overall, the headline index in the first four months of 2020 was up a mere 1.8 percent year-on-year, the slowest pace over the past five years.

The ministry pointed out the slowdown in industrial production has led to a shortage of raw materials and difficulties in goods consumption and exports.

The industrial and processing sector rose by three percent while many other sectors saw slight increases, or even suffered sharp declines, said the ministry.

The pandemic is having impacts on imports and exports between Vietnam and its major trading markets, such as China, Japan, the European Union, and the United States.

The rapidly falling demand for goods and subdued trading activities have resulted in steep declines in both imports and exports in April, according to the ministry.

Exports in the industrial and processing sector suffered the largest contraction of 20 percent compared with other industries while the import of raw materials slumped by about eight percent.

Deputy Minister of Industry and Trade Do Thang Hai was quoted by the Vietnam News Agency as saying that the ministry aims to restructure the chains of industrial production, especially in textile and garment, footwear, electronics, and wood-processing sectors.

The move is to promote sustainable cooperation with partners from South Korea, Japan, and India, thus reducing the reliance on a few partners and markets.

The ministry is planning to review the situation and demand for input materials so that production plans and solutions will be put forward, and sources of raw materials diversified.

For the first time, the ministry’s trade promotion department has collaborated with the Department of Commerce of Guangxi Zhuang Autonomous Region in showcasing goods online in an event that gathered hundreds of Chinese and Vietnamese firms.

The ministry predicted the global demand for consumption will make a recovery once the pandemic runs its course.

Early this month, Prime Minister Nguyen Xuan Phuc gave the go-ahead for the export of medical face masks without any cap on their export volume so that Vietnam would grab the opportunity to become the world’s face mask manufacturing hub amid the COVID-19 pandemic.

Customs data show the Southeast Asian nation exported more than 415 million face masks worth US$63.19 million between January 1 and April 19, mainly to Japan, South Korea, Germany, and the United States.

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