VNExpress-Oct 23
Vietnam’s factories are bracing for a challenging end-of-year season as plunging orders from their main markets, U.S. and Europe, hamper their post-pandemic recovery.
For the last several months, workers at bag manufacturer Virtue King Vietnam have not had overtime because there is no extra work for them after their eight-hour shifts.
“Orders have been plunging by 20-30% year-on-year even though Christmas is coming up,” Nguyen Thanh Can, chairman of the Binh Duong-based company, told VnExpress International. He said that the strongest declines were seen in Europe and the U.S., while other markets such as Canada, China, Japan and South Korea also lowered their purchases. Footwear maker V.P. in Ho Chi Minh City, an exporter to European countries with a major focus on Spain, said that the company has seen orders fall nearly 30% over last year. The decline burdens the company with more challenges after it already faced difficulties this August and September in sourcing materials from other countries; and earlier this year, it had faced difficulties in recruiting employees, said deputy CEO Pham Thi Minh Thu. With less orders, workers have seen their incomes decline and make life more difficult, she added. Many other factories in Vietnam are in a similar situation as residents of Western nations tighten spending amidst rising inflation. Vietnam’s exports in September fell by 14.3% over August, the second lowest this year, according to the General Statistics Office.
In the third quarter, 65% of exporters saw new orders decline or stay the same as the second quarter, it added. Garments, one of Vietnam’s biggest export items, is set to post slower growth for the remainder of this year as demand from American and European buyers fall and retailers there still have high inventories, analysts of Rong Viet Securities said in a note. Read more at: https://e.vnexpress.net/news/economy/factories-brace-for-cold-winter-as-western-orders-decline-4526417.html
