According to the assessment of the General Statistics Office, world aggregate demand in the first quarter of 2024 will maintain a recovery trend from the fourth quarter of 2023. Domestically, some leading enterprises in export activities such as Samsung, Intel… set production plans for positive growth in 2024. Input factors such as raw materials and fuel increased, showing the recovery of production and export activities.
Orders are not abundant, costs are high
Dr. Can Van Luc, Chief Economist of BIDV, member of the National Financial and Monetary Policy Advisory Council, commented that Vietnamese enterprises, after a very difficult time in terms of export orders, are now proactive and diversify Form and concise orders more than before. Businesses have also become more interested in digital transformation and greening to meet increasingly high standards from foreign countries, especially the US and EU. “We monitor and see that businesses from other countries, including Vietnam, have been resilient and adapted well to geopolitical risks recently. For example, when conflicts occurred in the Middle East or the Red Sea area, many goods and service transports immediately switched to going around the Cape of Good Hope. The amount of goods circulating through the Cape of Good Hope has now doubled, compensating for the decline in goods passing through the Red Sea. However, the problem that arises is that transportation costs have increased, insurance fees, and labor have also increased while delivery time is 1.5 times slower than before” – Mr. Luc informed.
To cope with unpredictable changes in the coming time, this expert believes that on the one hand, businesses must adapt; On the other hand, management agencies provide more information and market forecasts for businesses to be more proactive. “Enterprises have diversified their markets, partners, including partners in the transportation sector, also need to pay more attention to the field of goods storage, must have warehouses to store and store goods to be proactive. production and business plans. In addition, there needs to be better support from embassies, Vietnamese trade offices abroad and industry associations to inform businesses and help them minimize legal risks. , trade protection has been increasing” – Dr. Luc stated his opinion.
According to Mr. Nguyen Phuoc Hung, Standing Vice Chairman of Ho Chi Minh City Business Association (HUBA), although exports in the first quarter of 2024 have improved much better than before, some industries and businesses are still in a state of scarcity of orders due to being affected by the shortage of orders. loss of traditional markets and consumers tightening spending. Labor-intensive industries such as footwear and textiles still do not have enough medium and long-term orders, so production and business cannot be stabilized. Due to a lack of orders and fierce price competition, many customers offer prices that are only 50% of the normal price, and some even offer prices that are only 40%. To adapt, many businesses proactively restructure, save, reduce resources, and cut spending.
In addition, economic institutions still have many barriers, administrative procedure reform has not met expectations and some unclear legal issues… are barriers for the business community.
For the seafood industry, exports in the first quarter of 2024 reached nearly 2 billion USD, an increase of more than 8% over the same period last year. Many markets have shown clear signs of recovery, especially the US market with a growth rate of 16%. According to Mr. Ho Quoc Luc, Chairman of the Board of Directors of Sao Ta Food Joint Stock Company, Vietnamese shrimp is entangled in an anti-subsidy lawsuit in the US market. The US Department of Commerce (DOC) recently announced the preliminary tax rate for this lawsuit is 2.84%. Although this tax rate is lower than that of the Indian and Ecuadorian shrimp industries, it is still a significant obstacle. “Hopefully in the near future, DOC will go to Vietnam to appeal, if this tax rate is reduced below 2%, the lawsuit can be canceled” – Mr. Luc said.
In the Japanese market, businesses are currently stuck with Doxycycline antibiotic targets. This is a substance that is not banned in Vietnam and many countries in aquaculture. However, the maximum allowable residue level (MRL) regulation of the Japanese market is 10 ppb while the EU, China, and New Zealand allow this target to be 100 ppb. Businesses recommended that they need to negotiate with Japan to bring the MRL of Doxycycline to the same level as other markets.
In the Korean market, despite high growth thanks to the Korea-Vietnam Free Trade Agreement (KVFTA), shrimp importers in this country currently have no incentive to increase purchases from Vietnam because of quota problems. Korea only brought tax to 0% on 15,000 tons of Vietnamese shrimp, the excess must pay 20% tax, so importers in this country give priority to increasing shrimp purchases from Peru because there is no need for quotas.
Capital barriers
A significant barrier for export enterprises is capital. Mr. Vu Thai Son, Chairman of the Board of Directors of Long Son Joint Stock Company, Chairman of Binh Phuoc Association, said that businesses are borrowing 6 months in VND with an interest rate of only 4.5%-5%/year – a low interest rate. the best he had seen in decades. “However, only large enterprises like Long Son can borrow capital at cheap interest rates, small and medium enterprises will not be able to do so. We have to go through the process of mergers and acquisitions to increase scale and optimize management. Therefore, the state needs to create conditions for businesses to increase their scale to have enough potential and competitiveness, thereby accessing cheap capital” – Mr. Son said.
With the coffee industry, the capital situation is even more stressful. After only half a year, the price of raw coffee has more than doubled and is approaching the threshold of 130,000 VND/kg, causing many businesses to lack capital to do business. Recently, the Vietnam Coffee and Cocoa Association (VICOFA) proposed that banks increase loan limits and prioritize interest rates for coffee export businesses right at the beginning of the harvest season to stabilize the source of goods. .
Mr. Nguyen Duc Hung, Director of Napoli Coffee Import-Export Production Trading Joint Stock Company, said that the export coffee market is good, with more buyers than sellers. However, to increase profit margins, businesses are required to participate in deep coffee processing because the future price of raw coffee will be high. “However, everything you do requires capital. In the coffee industry, weak capital means failure. Any business with large capital to reserve goods will make large profits. Therefore, businesses currently need preferential capital from banks” – Mr. Hung expressed.
Regarding the fruit and vegetable industry, Mr. Dang Phuc Nguyen, General Secretary of the Vietnam Fruit and Vegetable Association, said lack of capital is also a big problem for businesses. “Last year, durian exports achieved high value but many Vietnamese businesses lost money because they had to buy high-priced raw materials to pay low-priced contracts” – Mr. Nguyen explained. The reason for this situation is because some Chinese traders with strong capital and market knowledge come to Vietnam to buy goods under the name of Vietnamese people. This makes many Vietnamese businesses unable to export directly but can only do outsourcing for Chinese traders and enjoy small profits.
| Not fully supported by the bank
Mr. Nguyen Phuoc Hung cited the results of the business survey in the first quarter of 2024 showing that many businesses reported not being fully supported by banks. Typically, deposit interest rates have fallen to a very low level, only 4%/year, but many old business loans have not yet dropped below 10%. Some regulations on lending, loan collateral and collateral valuation are too strict, making it difficult for businesses to access bank loans. As a result, many businesses are still struggling to manage cash flow for production and business. “According to HUBA’s survey, 43.3% of businesses petitioned the city to support credit capital and reduce loan interest; 60% of businesses recommended promoting investment and consumption stimulation; 45.6% of businesses proposed reducing taxes and fees…” – Mr. Hung said. |
According to NLD.com.vn
