Challenges overcome to maintain growth

Trade surplus of Binh Duong in 2022 was nearly USD 10 billion of products exportation to over 90 countries, regions and territories, contributing to the affirmation of brand names and prestige of Binh Duong in the world’s markets.

Furniture production is maintained inh Binh Duong to ensure exportation orders. In this photo: Production is on-going at Nhat Nam Furniture and Mechanic Company in Ben Cat town

Challenges anticipated

In 2022, importation and exportation continue to be bright in the economic picture of Binh Duong province with a total export turnover of goods at more than USD 35.6 billion, increasing by 9% compared to 2021; and, import turnover of more than USD 25.8 billion, increasing by 1% over the previous year. Not satisfied by the results, all levels and sectors are always ready to respond to drawbacks and anticipate challenges. Vo Van Minh - Chairman of the provincial People's Committee, assessed that since the beginning of the year, the production and business situation of enterprises is positively recovering, but certain problems remain. Prices of production materials have decreased but still at a high level due to the increasing inflationary pressure. The US and EU markets tend to cut spending, which affects the situation of enterprises signing exportation orders, requiring all levels, sectors, localities and the business community to make efforts and creatively implement the macro-level directives of the government and ministries, and be drastic in operating and supporting the business community.

“Industries and localities need to focus on monitoring and closely monitoring the production and business situation of enterprises to promptly remove difficulties and obstacles, and assist businesses in accessing preferential loan policy packages, reducing interest rates, rescheduling debt repayment etc. to create a stable and favorable environment for enterprises to feel secure in production and business investment. In addition, businesses in the province actively transform models, change strategies, respond flexibly, boldly and digitally transform to quickly stabilize production and business activities, and expand market for domestic consumption and export," directed Mr. Vo Van Minh.

In order to practically support businesses to expand the market, Nguyen Van Danh – Deputy Chairman of the provincial People's Committee, affirmed that the province promotes foreign economic activities to attract foreign direct investment capital. Binh Duong also actively expands bilateral and multilateral cooperation with foreign localities and international organizations; thereby, promoting the promotion and connection of trade to improve the efficiency of trade promotion activities, and to more actively support businesses and industries seeking opportunities to exchange, purchase, and provide goods and services with partners in the near future.

‘Gathering the wind into a storm’

According to Nguyen Thanh Toan - Director of the Department of Industry and Trade, in 2023 Vietnam's export growth will depend on the economic situation in markets with large importation scale. Enterprises need to continue to maintain the growth of commodity exports on the basis of effectively taking advantages, and making efforts to find new markets that have been left open for a long time. Businesses need to master the tariff reduction roadmap of the free trade agreements that Vietnam has signed, especially the new generation agreements.

Currently, the restructuring of export enterprises to adapt to changes in the new situation is an important. Phan Le Diem Trang - Director of International Garment Joint Stock Company, said: “We are trying to restructure the business towards a leaner direction to promote the application of technology in production management. Regarding the market, we decided to hit on the high-end segment to serve the needs of the elites. For processing orders, we will receive small and odd orders to ‘gather the wind into a storm.’ All of those solutions are really working.”

Hosen YouSof - Chief of Office of Binh Duong Furniture Association (BIFA), said that in order to overcome challenges, the furniture export enterprises strive to develop business strategies for each specific item and each target market, select market segments and distribution channels suitable to the product and size of the business, and focus on understanding tastes, trends and market characteristics through international seminars, fairs and exhibitions. In addition, businesses need to increase products in niche markets and access new markets. Along with traditional markets, businesses should pay attention to under-exploited markets such as Australia, Canada, Arab world, South Africa among others while diversifying forms of advertising and trade promotion to take advantage of the support of international organizations, and online tools.

Businesses also need to understand that as Vietnam's strides towards international recognition, it is important to address environmental and sustainability issues - the requirement of the imports covered by free trade agreements.

“In a connected and collaborative world, Binh Duong businesses and their partners should work to strengthen the adaptability of the global supplying chains. Indian partners and Binh Duong businesses, for example, need to cooperate to reach the crowded market. Besides, the parties need to cooperate to export goods to a third country, creating higher value of goods," said Nguyen Thanh Toan.

Reported by Tieu My – Translated by Vi Bao