According to Vietnam’s “China-Vietnam+” report on May 26, according to statistics from the General Bureau of Statistics of Vietnam, Vietnam’s merchandise exports reached US$103.9 billion in the first four months of 2021, a year-on-year increase of 28.3% , among which the total export volume of 19 commodities exceeded 1 billion US dollars. In the context of the COVID-19 pandemic, this is a commendable achievement. Market information is very optimistic, but manufacturers and exporters still face the problem of soaring raw material prices.
More than a year after the outbreak of the COVID-19 epidemic, the world economy has gradually adapted and begun to recover, creating convenience for the recovery of Vietnam’s export industry.
According to a report from the Vietnam Textile and Apparel Association, the textile industry has proposed a textile and apparel export target of US$39 billion in 2021. With export results in the early months of 2021, this is a realistic goal. In recent times, market purchasing power has recovered and the textile industry has a competitive advantage. A series of free trade agreements have come into effect. Enterprises’ adaptability has been continuously improved and they have actively promoted the diversification of export markets.
Ms. Phan Thi Thanh Château, vice president of the Vietnam Leather Footwear and Handbags Association, said that the export of leather footwear products has grown well in early 2021, and Vietnamese products have won the trust of customers. In addition, the leather footwear industry can make better use of the free trade agreement (EVFTA) signed between Vietnam, the European Union and the United Kingdom, which will help improve the competitiveness of Vietnamese leather footwear products in some key markets.
According to the forecast of the Ministry of Industry and Trade, in the future, a series of free trade agreements will continue to play a role and become a booster for Vietnamese goods to enter partner markets, and export activities will Continue to improve.
Although the export market shows positive and optimistic signals, many companies still face difficulties with rising raw material prices, transportation costs, and the outbreak of the new crown epidemic in many places.
The rising prices of raw materials are also a headache for textile and garment enterprises. Li Rong, manager of Chengda Textile Company, said that not only has shipping freight increased, leading to an increase in imported raw materials, domestically produced raw materials have also increased by 20-30% compared with the end of 2020, causing enterprises to face many difficulties.
Li Rong shared that due to the impact of the COVID-19 epidemic, consumers have tightened their spending, and it is difficult to increase product prices due to increased costs.
Many experts and industry association representatives believe that rising raw material prices are not a new problem, but for many enterprises in Vietnam, this problem is becoming more and more serious. At present, attention should be paid to attracting investment and building specialized production areas for raw materials for industries such as textiles and leather shoes.
Experts also believe that authorities should take concrete actions to develop domestic raw material development strategies for production and export activities. Sufficient supply of raw materials and reduced product costs are important conditions for companies to effectively utilize the benefits brought by various free trade agreements and thereby improve product competitiveness.
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