Due to a lack of orders, businesses operate at a subpar level.

DNHN - Even though it's been more than a month since the start of the third quarter, many businesses in Ho Chi Minh City have reported modest export orders, and factory production has remained steady.

In numerous markets, demand declines.

 The majority of major export markets have reduced orders from Vietnamese suppliers. According to data from the Ministry of Industry and Trade, exports to the Americas only reached $52.58 billion in the first half of 2023, a decrease of 79.5% compared to the same period last year. Orders decreased by approximately $13.5 billion.

Exports to the United States only reached 44.2 billion USD, a decrease of 22.6% over the same period; exports to Canada reached 2.8 billion USD, a decrease of 13.0%.

Despite being flexible in production, "picking up" even small orders, businesses face numerous challenges when customers tend to reduce their spending. Even though the first month of the third quarter has come to a close, the number of new orders at many companies has shown no signs of improvement, falling short of expectations.

Mr. Nguyen Ngoc Luan, the director of Global Trade Link Co., Ltd., a company specializing in the wholesale of food, beverages, garments, and footwear, stated that from the beginning of the year to the present, orders in the industry's most important markets, such as Australia and the United States, have decreased by more than 30 percent. In 2022, the European market developed very well, but this year it is significantly worse.

With nearly all of the Russian market lost. The ruble has lost significant value against the US dollar. In addition, because of the US and European embargo against Russia, bank payments are blocked.

It is challenging for businesses in the rice industry to operate in the opposite direction. Currently, the rice supply in Vietnam is constrained, particularly in the summer-autumn rice crop of 2023, which will have a low yield and inferior quality compared to the winter-spring rice crop of 2022.

Mr. Phan Van Co, marketing director of Vrice Group Co., Ltd., is concerned that the output of the Summer-Autumn crop will decrease by 15 to 20 percent compared to the Winter-Spring crop, which will have a significant impact on partner order demand.

Find a way to expand market access.

To survive in the face of numerous obstacles, the majority of businesses exert effort and actively seek out new markets. In addition to China, the United States, and Europe, businesses have actively pursued opportunities in the Middle East and Africa.

Mr. Tran Van Son, director of Gia Bao Group Joint Stock Company, stated that businesses continuously promote their products in Japan, China, and Dubai during difficult times for general orders. Especially in India and Middle Eastern markets such as Saudi Arabia, the demand for forest and agricultural products is currently quite high. Muslims consume a wide range of Halal foods, including confectionery, beverages, dairy products, organic foods, herbs, cosmetics, pharmaceuticals, and other items.

"The global Halal food market for Muslims is estimated to be worth up to $1.5 trillion, but Vietnam's ability to export Halal products remains limited. Son believes that this is an opportunity for Gia Bao in particular and many Vietnamese exporters in general.

Mr. Lu Nguyen Xuan Vu, General Director of Xuan Nguyen Group Joint Stock Company, is seeking and implementing innovative solutions for his company. Particularly, Xuan Nguyen focuses on expanding product distribution, launching numerous promotions to stimulate consumer demand. In addition to capturing the market, this will help businesses create jobs. In the latter half of 2023, workers will be employed.

Waiting for opportunities in the international market to recover, many businesses choose to concentrate on developing the domestic market, sustaining production, and primarily creating jobs to retain employees while focusing on domestic market development. However, the duration of this circumstance is uncertain if it continues.

Therefore, Mr. Phan Van Co proposed a solution to simplify administrative procedures and reduce logistics costs for the benefit of businesses. Currently, traffic jams, ferry jams, and port jams occur frequently, requiring businesses to store yards and incurring high costs. Inadequate logistics infrastructure, such as warehouses and ports being flooded, has led to the infiltration of water into exported goods, forcing businesses to compensate their business partners.

In addition, the director of Global Trade Link Co., Ltd. stated that many State policies aimed at assisting businesses are slow to take effect, and loan procedures remain convoluted; consequently, ministries, departments, and sectors must provide synchronized solutions for businesses to overcome this challenging period.

based on Investment Newspaper