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Prime Minister's Meeting with Enterprises: VITAS proposes recovery solutions for the textile and garment industry

09/08/2021 12:57 PM
On the morning of August 8, 2021 in Hanoi, Prime Minister Pham Minh Chinh chaired an online conference of the Prime Minister to work with representatives of businesses, business associations and localities on solutions to solve problems. remove difficulties, promote production and business of enterprises in the context of the Covid-19 pandemic.

rime Minister Pham Minh Chinh emphasized that "The government understands and sympathizes with the accumulated difficulties of businesses in the current pandemic context". He said that, within their capacity, the Government, ministries and localities have tried their best to create the best conditions to support businesses in terms of mechanisms and policies to maintain, restore and develop production. The difficulties of the business community will still be many and need timely solutions to restore production. Prime Minister Pham Minh Chinh said that he will meet businesses in each field and industry to discuss more deeply, have more suitable solution.

Prime Minister Pham Minh Chinh worked with business representatives, business associations and localities. Photo VGP 

The report of the Ministry of Planning and Investment at the conference also showed the "gray gamut" in the current business picture. In the first 7 months of the year, the number of enterprises waiting for dissolution was 28,038, an increase of nearly 29% over the same period in 2020. The number of enterprises that completed the dissolution procedures was 11,384, an increase of more than 27% over the same period in 2020. On average each About 11,300 businesses withdrew from the market every month. Minister Nguyen Chi Dung said, “It is becoming more difficult for businesses that are already hurt to become more difficult than ever. Resources reserve is running low while the market no signs of recovery or are recovering very slowly”, Stating point of view to support businesses in the future, Minister Nguyen Chi Dung said that It is necessary to continue to uphold the spirit of "Fighting the pandemic like fighting the enemy".


Sharing at the Conference, Chairman of the Vietnam Textile and Apparel Association (VITAS) Vu Duc Giang, on behalf of the Association and the industry, reported to the Prime Minister the great difficulties that the textile and garment industry faces in the fourth wave of the pandemic. Covid-19. Mr. Giang said The implementation of prolonged social distancing in accordance with Directive 16 of the Government in the southern provinces has caused most of the garment factories in these localities to close because they are not eligible to implement the "3 on-site" regulation. "Enterprises suffered great losses due to having to stop production, having to cancel export orders from customers, while still having to bear the costs of maintaining the factory and paying wages to employees. At enterprises still operating in production, it is difficult because they have to reduce 50%-60% of the number of employees working to implement the distance. The supply of raw materials is broken, and at the same time, it incurs many costs to establish measures to prevent Covid, test and vaccinate employees. Businesses have to face great pressure as many workers have moved back to their hometowns due to fear of spreading the disease. The high cost of international and sea transportation along with the increase in fuel costs and the price of imported raw materials has greatly affected production, causing many difficulties for enterprises. The anti-epidemic regulations are implemented in a lack of uniformity in localities, causing difficulties for businesses, including the textile industry.

Mr. Vu Duc Giang emphasized, in order to realize the "dual goal" of both controlling the Covid-19 pandemic, maintaining production, ensuring jobs and income for employees, and limiting supply chain disruptions, the problem is Exploiting the most and fastest source of vaccines and injecting the right people is an urgent issue. VITAS has worked with the American Apparel and Footwear Association (AAFA) and many brands, international partners and domestic associations to have a letter to President Biden giving priority to support Vaccines for Vietnam. The association has also cooperated with other industry associations to find the supply of supporting vaccines.


Regarding the implementation of the "3 on-site" or "one road - two destinations" option, Mr. Giang emphasized that this can only be a temporary solution in the short term. Some businesses have discovered that F0 have to close their businesses and are very confused in how to handle them. As of August 5, 2021, some provinces require businesses to close even if there are no F0 cases. VITAS suggested that the Government and the Ministry of Health provide guidance for each specific scenario so that businesses and localities can agree to cooperate in implementation.

To be able to realize the dual goal, an important solution is that import and export goods are not congested. VITAS proposes to abolish the regulation on the issuance of QR-Code on the "green channel" nationwide, and proposes the Ministry of Health to uniformly regulate each type of test paper and the validity period of each type, when driving in traffic. Through the provinces, removing the regulation that only essential goods can be circulated, instead allowing the circulation of goods under normal conditions if the pandemic prevention is ensured, except for goods banned from trading or goods restricted from trading according to regulations (as suggested by the Ministry of Industry and Trade on July 27, 2021). Because, if the dual goal is realized but exported goods and imported raw materials are not allowed to be circulated, how can it be done? 


Mr. Giang also said that VITAS has proposed to the Congress, the Government and ministries, branches and wards, asking the State to remove the regulation on paying VAT for domestic fabrics used for garment export; amend the Trade Union law in the direction that enterprises pay up to 1% of the trade union fee instead of 2% as at present; reduce road tolls, BOT fees, stop collecting seaport fees of Hai Phong and Ho Chi Minh City. Ho Chi Minh City will not charge seaport fees from October 1, 2021 as expected. The association proposed the Government direct the banking system and credit institutions not to lower the credit limit, continue to reduce the interest rate to 0.5-1%/year, and extend the repayment period of principal and interest for the year. 2021 and 2022. At the same time, it is necessary to have support packages for businesses and employees with the simplest procedures and conditions, especially now that the suspension of trade union contributions still remains the same condition that employees lose their jobs from 50% or more, making it inaccessible to businesses.

Some other pictures at the conference (speech from Vietnam Chamber of Commerce and Industry, Association of Seafood Exporters and Producers, Vietnam Logistic Association, Vietnam Electronic Enterprise Association)

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