Stockpiles, inflation threaten manufacturers

During an online ministerial meeting held on September 5, Nguyen Tien Vy, director of the Planning Department, announced that the industries which had seen their production slipping included detergent (0.2 per cent), cable wire (22.8 per cent), natural gas (6.3 per cent), liquefied petroleum gas (5.4 per cent) and petrol (2.7 per cent).

Electronics and electrical appliances experienced significant decrease with air conditioners dropping by 20.8 per cent and refrigerators by 14.5 per cent, Vy said.

According to the Ministry of Planning and Investment, domestic producers have been hit hard by huge stockpiles during the past two months, several businesses having their stockpiles account for up to 30 per cent of production.

Nguyen Gia Tuong, deputy director of the Vietnam National Chemical Group, said that his corporation had found it hard to fulfil its 2011 target of 15 per cent growth due to slowed battery production alongside increased coal prices.

However, Tuong said that under the Price Ordinance, his corporation had been unable to raise its product prices, making survival hard.

As a result, he added, the Vietnam National Coal and Mineral Industries Holding Corporation Limited should design a road map on raising coal prices in order to better prepare its partners in terms of production and consumption.

Vu Huy Hoang, Minister of Industry and Trade, asserted that while certain difficulties would remain until the end of the year, inflation had been slowed in the past two months thank to a government resolution, which in the long run could help bring inflation down to under 19 per cent.

The minister urged city and provincial industry and trade departments to help manufacturers sell off their stockpiled products, calling on Electricity of Vietnam to help power production during the next four months.

Hoang said that the MoIT would ask the Ministry of Finance to provide around VND150 billion ($7.2 million) for trade promotion.

At the meeting, it was announced that Vietnam ’s exports may rise by 25 per cent for the entire year with a lower trade deficit (around 12 per cent).

To boost exports and investment, the MoIT plans to help introduce Vietnamese goods into large supermarkets in Europe while organising regular business forums.

Hoang added that his ministry, in co-operation with the Ministry of Finance, was reviewing export-import tariffs in order to adjust tax policies with the purpose of enhancing exports and curbing the trade deficit.