Vietnamese businesses have voiced their concerns over the struggle to cope with the coronavirus due to a lack of raw materials.
Mai Xuan Duong, president of the Garment and Textile Association in Hung Yen Province, said while businesses had not been affected that much, the possibility of lacking materials in the coming months seemed real.
“Most of our materials such as cloth and thread are imported from China. Reports show we only have enough to last for another month.
“Due to the epidemic in China, our suppliers cannot ensure the materials we have ordered will be delivered. It’s almost unavoidable that businesses in Vietnam will lack materials at this time,” Duong said.
He said such a shortage would result in businesses having to temporarily suspend operations, with workers being laid off, for two to four weeks.
The damage was obvious, he said.
Some 5,000 garment businesses in Vietnam employ 2.5 million workers. Even if workers are laid off due to lack of production materials, businesses will still have to pay them.
The garment and textile sector is not the only one affected.
Nguyen Van Manh, a driver for the North-South Passenger Bus Company said in the past month, the number of passengers had dropped sharply, so his company was planning on cutting services and laying off drivers like him.
Meanwhile, Ho Chi Minh City Rubber Plastic Manufacturers Association chairman Nguyen Quoc Anh said production of rubber and plastic in Vietnam was largely dependent on China with 70 per cent of materials imported from the country.
“If our Chinese partners aren’t able to supply materials in the next month, we will have to import them from Japan or South Korea at higher prices. We won’t be able to make a profit because we signed contracts for these goods years ago,” he said.
Vu Minh Tien, director of the Ministry of Labour, Invalids and Social Affairs’ Institute of Workers and Unions, said laws on labour and social security state that in certain cases when labourers are laid off temporarily, businesses could temporarily suspend paying their social insurance.
“I think both businesses and labourers need to share these difficulties to overcome the situation,” Tien said.
VIET NAM NEWS/ASIA NEWS NETWORK