Hanoi steps up measures to support exporters to overcome Covid-19 havoc
Hanoi’s exports in the first two months of 2020 dropped 19% year-on-year to US$1.72 billion, and most export products suffered declines in revenue.
As the Covid-19 epidemic is causing negative impacts on trade, Hanoi has taken measures to aid exporters and ensure the target of US$18-billion exports in 2020 remains on track, according to Vice Chairman of the Hanoi People’s Committee Nguyen Doan Toan.
This include training courses for enterprises regarding new free trade agreements and information on foreign markets; stepping up administrative reforms and IT application in tax management process; issuing preferential certificate of origin for companies in industrial parks via public online services at advanced stages, among others.
Moreover, Hanoi’s authorities are set to provide support for specific export products. For electronic, computers and parts, the city plans to construct pilot electronic industrial parks, aiming to develop supporting industries. In the agricultural sector, Hanoi would mobilize financial resources for investment in new farming technologies and seedlings.
The municipal People’s Committee would request the State Bank of Vietnam to continue providing preferential loans for manufacturing and export companies.
Vice Director of Hanoi’s Department of Agriculture and Rural Development Ta Van Tuong said the agency is tasked with helping farmers and enterprises in branding promotion and adoption of safe production practices; geographical indication and traceability for labeling of agricultural export products; hi-tech farming, among others.
Director of Hanoi’s Department of Industry and Trade Le Hong Thang said trade disruption with China as a result of the Covid-19 epidemic is putting pressure on local enterprises, particular those in the fields of textile and electronics, in looking for input materials for production.
Thang added a number of industrial sectors are dependent on materials from China, which supplies up to 50% of input materials for textile and garment, 27% for footwear and 25% for phones, electronics and machinery.
Director of Thanh Vinh Agriculture and Foods Import Export Company Nguyen Duc Thanh said 60% of the company's revenue comes from exporting products to China. However, the epidemic is blocking trade flows to this market.
Data from Hanoi Statistics Office revealed the city’s exports in the first two months of 2020 fell 19% year-on-year to US$1.72 billion, in which most export products suffered declines in revenue, including phones and parts down 32.2%; electronic and computers down 30.5%; machinery, equipment and parts with 26.8%.
A representative of the Department of Industry and Trade suggested local enterprises diversify their export markets to economies having free trade agreements with Vietnam such as South Korea, Japan and the EU.
A recent study from Fitch Solutions said the Covid-19 epidemic in China would continue to exert heavy pressure on Vietnam’s manufacturing sector in the first half of 2020.
Fitch noted that China’s aggressive measures to prevent the spread of the virus have inevitably weighed on domestic manufacturing and production, as well as logistical mobility, which will lead to spillover effects into Vietnam, particularly as China is a key source of raw materials and a major export market for Vietnam.
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