Kinhtedothi - Labor shortage, production stagnation, high costs, mandatory implementation of "3 on the spot" in the context that many provinces and cities are social distancing according to Directive 16 of the Prime Minister are the difficulties of textile and garment enterprises due to the impact of the Covid-19 epidemic.
This reality is becoming a big challenge for the textile and garment industry and the goal of achieving an export turnover of 39 billion USD is impossible when there are only 4 months left until the end of 2021.
Stacking of difficulties
Information from the General Statistics Office, the total export turnover in the first 7 months of 2021 of Vietnam's textile and garment industry reached 18.6 billion USD, up 14.1% over the same period in 2020. Notably, as reflected by the By this time, most businesses have received orders until the end of 2021, even enough orders for the first and second quarters of 2022. However, the Covid-19 epidemic has been having a great impact on production and export activities of the textile and garment industry, especially for textile and garment enterprises in Ho Chi Minh City, which is a locality with complicated epidemics. the most in the country.
The textile industry is facing difficulties because of the Covid-19 epidemic. Photo: Qinghai
Vitas Chairman Vu Duc Giang said that textile enterprises in Ho Chi Minh City in particular and textile enterprises in the whole country in general are facing great challenges. Orders already exist, but due to the impact of the epidemic, the risk of enterprises stopping production, unstable production, and unscheduled delivery exists. In fact, when the fourth wave of Covid-19 broke out, at least 45 textile and garment enterprises had to stop production. Along with that is the concern of labor shortage while costs are increasing. Not only that, businesses also have to change the mode of transportation, switch to air freight to timely deliver the goods to partners.
“At the moment, the proportion of factories that have to close has reached 30-35%. At this point, a series of these factories will even have to close for a long time, especially for small and medium enterprises. That's because businesses do not have enough potential to pay for problems for "3-on-the-spot" work, pay support for employees to return to work, etc. This is a huge challenge in the industry. stabilizing the model of Vietnamese textile and garment enterprises” - Mr. Vu Duc Giang analyzed.
General Director of Garment 10 Corporation (Garment 10) Than Duc Viet shared that from now until the end of the year, there is a shortage of containers for both import and export directions, as well as transport enterprises are demanding an increase in freight rates. to 20%, while May 10 still has to pay other costs. This will certainly have a negative impact on the export turnover of enterprises. Even if the business is slow to deliver the goods, the partner will be fined for the progress, not to mention the shipments that the enterprise cannot deliver by water, must go by air at a cost many times higher.
Efforts to overcome difficulties
In order to pay orders to partners in time, textile and garment enterprises are running at full capacity. According to Mr. Than Duc Viet, the unit has to take care of production and business, and strictly implement measures to prevent and control the epidemic with the goal of not letting the Covid-19 epidemic appear in May 10 and not letting anyone be left behind. back behind. Currently, May 10 increases production capacity and restructures working groups and shifts to increase labor productivity in order to promptly return goods to partners under the contract, avoiding penalties for being late.
At this time, Binh Minh Garment Joint Stock Company (Ho Chi Minh City) only dares to accept orders equal to about 70% compared to 2020 from US and European customers so that when there is a bad situation, a case occurs, can transfer orders to the company's factories in other regions to produce. “In order to ensure the delivery schedule, before receiving the order, we calculate and choose the goods that belong to our forte. The delivery time must be extended, if there is a shortage of labor, other lines will increase the number of workers, if there is a shortage of people or labor, they will rotate people in the line or send people from the indirect block to support the direct production block. - General Director of Binh Minh Garment Joint Stock Company Vo Quoc Hao said.
At Viet Thang Jean Co., Ltd., factories in Ho Chi Minh City have to produce about 20,000 products every day so that there are enough 5 containers of goods a week to deliver to customers in the US, Europe and Japan. While the labor shortage is about 20% and the distance must be implemented, enterprises are forced to increase to 2 shifts. Meanwhile, businesses still strictly follow the principles of disease prevention, ensure the distance in production, lunch, break between shifts and continuously disinfect these areas. General Director of Viet Thang Co., Ltd. Jean Pham Van Viet said: “In order to ensure safe production in the context of complicated epidemic developments, the company has remodeled its factory to meet the strict implementation of the Directive. Directive 16 of the Prime Minister on social distancing. The company has arranged for workers to both work, eat and rest on the spot, so even though many areas in the city are blocked, the company still ensures to maintain production."
According to many economic experts, the urgent and long-term solution for Vietnamese textile and garment enterprises to stabilize production is still to speed up the vaccination schedule for workers. In particular, in the current context, recruiting enough workers and vaccinated workers will create good conditions for businesses to feel secure in production and timely delivery of goods in the time to the end of the year. This not only helps improve the prestige of Vietnam's textiles and garments today, but also creates a source of profit, creating a premise for the industry's breakthrough in the coming years.
Can't hit export target?
Commenting on the possibility of achieving the export target of 39 billion USD in 2021, Mr. Vu Duc Giang said that if entering September 2021, the epidemic situation in the southern region will be controlled, enterprises will return to work. Under normal conditions, this year's export figure will reach about 32-33 billion USD. But if the epidemic continues to be complicated, the figure of 32.33 billion USD is also difficult to achieve.
Forecasting the situation of textile and garment exports in the last months of the year, some economic experts expressed unoptimistic views. Because according to the explanation, in the context of implementing the dual goals of preventing epidemics and maintaining production, textile and garment enterprises will continue to face many challenges that cannot be overcome in the short term. Even when the Covid-19 epidemic is controlled, difficulties such as: Lack of labor, higher production costs due to increased raw material prices, transportation and logistics fees will still surround businesses.
To remove difficulties for textile and garment enterprises as well as promote domestic production, the Government needs to have a policy of debt freezing, debt rescheduling, reduction of bank loan interest rates, and a favorable mechanism for enterprises to access loans at low interest rates. incentives to prepare for upcoming orders and pay workers. Along with that, the State supports businesses to reduce costs, extend the time to pay social insurance and health insurance until the end of the year, reduce and relax taxes so that businesses are more proactive in finance for immediate production. .
Particularly for textile and garment enterprises in Ho Chi Minh City and southern provinces, what they most want right now is for the Government to accelerate vaccination to soon achieve herd immunity, towards complete control of the disease. to return to normal business operations. At that time, the support policies of the state will create more resources for textile enterprises to restore production, speeding up the fulfillment of year-end orders.
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