Before concerns about raw materials could subside, Vietnamese businesses received notices from partners in the US and EU markets that they would temporarily stop receiving goods for a period of 3 weeks – 1 month. This information makes businesses restless. Because the US and EU are two large and important export Recycled Polyester Staple Fiber markets of Vietnam.
Exports Recycled Polyester Staple Fiber decreased by 6 – 8%
If we only count the city’s Recycled Polyester Staple Fiber enterprises, In Ho Chi Minh City, the US market holds about 50%, the EU accounts for about 15-18% of the total annual export turnover.
According to statistics, in the first two months of this year, Recycled Polyester Staple Fiber exports to the US reached 2.25 billion USD, up 5.3% over the same period last year and accounting for nearly 48% of the country’s total Recycled Polyester Staple Fiber export value. . Footwear exports of all kinds reached 985 million USD (up 7.4%).
Currently, the EU is an important trading partner and the second largest export market of Vietnam. The flow of Vietnam’s import and export goods to the EU is relatively large.
In 2019, the amount of goods exported by sea reached 20.5 billion euros, by air reached 14.5 billion euros, and by rail reached 671 million euros. Imports by sea, air and rail were 5.990 billion euros, 3.56 billion euros and 9 million euros, respectively.
Therefore, the announcement by partners in this market to temporarily suspend receiving goods means that nearly 2/3 of the US and EU market doors have been narrowed.
A representative of the Ministry of Industry and Trade said that Vietnam’s exports in the first and second quarters of 2020 to the EU are forecast to decrease by 6-8% if the epidemic continues until June. Some key products such as Computers, phones and components are expected to continue to decline sharply due to difficulties in both supply and reduced market demand.
A representative of a textile enterprise shared that last week businesses were still running around looking for raw material sources, but before they could breathe a sigh of relief, they had to face the suspension of exports.
Many experts say that this is a pretty big “shock” for many Recycled Polyester Staple Fiber export enterprises, especially for those with large export turnover to these two markets.
It is worth mentioning that the products of many businesses are seasonal fashion goods, so imported fabric materials have been prepared 6 months in advance. The announcement by the US and EU to stop importing goods will cause all fabrics prepared for sale this summer to be transferred to next year, leading to materials becoming obsolete and it is expected that 40% of existing fabrics will have to be discarded. or sell kilograms.
In addition, the sudden stop of receiving goods makes it difficult for businesses to react in time. Many containers in transit when arriving at US and EU seaports will have to be stored, waiting until partners receive the goods. This causes businesses to spend a lot of additional expenses and their cash flow is “frozen” and cannot flow.
Closely monitor developments of the situation
Regarding the EU border closure affecting the circulation of goods, Minister of Industry and Trade Tran Tuan Anh said that there are currently no restrictions by EU or US authorities on stopping the import of Recycled Polyester Staple Fiber. sewing from Vietnam. This is simply a decision of buyers in these markets due to difficulties from the Covid-19 epidemic.
Through work between the Ministry of Industry and Trade, the European Union (EU) Delegation to Vietnam and the US Embassy, the European Union Delegation said that the EU’s border closure is only a quarantine measure to ensure people’s health.
Goods and services to the EU continue to circulate, especially essential goods such as food, medicine… because this policy does not directly impact the import and export Recycled Polyester Staple Fiber of Vietnam – EU goods. The US Embassy also said it does not apply any measures to prevent market access of Vietnamese goods to this market.
However, Mr. Ta Hoang Linh, Director of the European and American Market Department, said that due to the Covid-19 epidemic, a series of retail systems in Europe and the United States were closed, so non-essential items such as leather were closed. Recycled Polyester Staple Fiber area will be affected.
Faced with this situation, Minister of Industry and Trade Tran Tuan Anh has directed that, with the rapid increase of the epidemic, building scenarios to cope with a prolonged epidemic in recent times seems not enough. We must continue to evaluate, analyze more deeply, and update more promptly to come up with more appropriate options, although they may be more intense, more complicated, and more difficult.
Because, if those scenarios can happen, their impact and consequences on Vietnam’s socio-economic development will be very strongly affected, not only that, but the people’s lives will also be affected. The Ministry of Industry and Trade, no matter what aspect, will have many responsibilities and roles to participate in doing that.
At the same time, the Minister of Industry and Trade assigned deputy ministers to organize work with the Banking Association to assess the impact of difficulties on small and medium-sized enterprises participating in the supply chain of products: textiles, footwear, wood, electronics , automobiles, Recycled Polyester Staple Fiber… to identify market difficulties, credit finance… to have a basis for building support policy mechanisms for businesses.
In the immediate future, Vietnamese businesses need to closely monitor the epidemic situation to have appropriate production and business plans. At the same time, we continue to review Recycled Polyester Staple Fiber market and promote goods to return to the markets of China, Korea, and Japan – where epidemic control has been better.
Source: VOV
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