Though exports remain strong, several sectors in Vietnam face difficulties due to the Covid-19 pandemic and require support from the government if they are to sustain the growth, experts said.

The Southeast Asian country is benefiting from the disruption of global supply chains, and manufacturers are seeking to diversify supply, including domestically.

Global demand is recovering and this is an opportunity for the country to boost its exports of consumer and industrial products, according to the Ministry of Industry and Trade.

It forecast the country’s foreign trade to remain robust as free trade agreements (FTA) are gradually being implemented in a more comprehensive and effective manner.

The Comprehensive and Progressive Agreement for Trans-Pacific Partnership, the EU-Vietnam Free Trade Agreement and the UK-Vietnam Free Trade Agreement will continue to smooth the way for Vietnamese goods to enter partner markets with preferential tariffs.

Yet Ho Chi Minh City Association of Garment, Textile, Embroidery and Knitting chairman Pham Xuan Hong said he remains worried since some members have had to suspend production since they are in a lockdown area or their workers are isolated for living in such areas.

“Though [the impact] is not too serious yet, there is cause for worry since we do not know when the pandemic would be controlled. If social distancing is prolonged, it will definitely affect export orders signed with foreign partners.”

Vietnam Association of Seafood Exporters and Producers secretary Truong Dinh Hoe said he has petitioned the Ministry of Agriculture and Rural Development to resolve the problem of lack of shipping containers for exports and reduce the growing freight rates.

In April freight for a 40-foot container to the west coast of the US was around $5,000, but now it is more than $10,000. It used to be less than $1,000 during pre-pandemic times.

Freight rates to Europe are also at high levels of $7,000-8,000.

Thuan Phuoc Seafood and Trading Corp chairman Tran Van Linh said marine transportation fees were at unreasonably high levels but import-export companies like his had to accept them.

Cancellation of orders or failure to deliver in time would undermine the company’s prestige and efforts to find customers in future.

Saigon Aquatic Products Trading JSC director Truong Tien Dung said that despite the increase in transport costs, it would be impossible to negotiate increases in products prices because Covid has forced consumers in places like the US and the EU to tighten their purse strings.

But the high transport costs are eating into companies’ profits, and not just the seafood sector but also others’ exports would be hit hard, he warned.

VIET NAM NEWS/ASIA NEWS NETWORK