Many Vietnamese exporters see profit soar during COVID-19
Many Vietnamese exporters have seen a sudden increase in profits during the COVID-19 pandemic.
|Producing medical gloves at a factory in Binh Duong Province. — Photo plo.vn|
VRG Khai Hoan JSC said it was in a state of full capacity and often had to refuse orders. The company's orders were only enough to run 70-80 per cent of factory capacity before 2019.
When the COVID-19 pandemic started last year, the company's traditional foreign partners quickly ordered a large number of medical gloves for storage, along with orders from new customers.
Duong Duy Phu, general director of VRG Khai Hoan, said that the company has closed production orders until the end of next year. Most of the goods are exported to the US, Europe, Japan and the rest serve the domestic market.
“As a manufacturing company in the medical field, the pandemic has boosted production and prices, therefore our profit surged suddenly last year, up VND500 billion (US$21.7 million), an unprecedented number, because of our average profit was only about VND5-10 billion each year," Phu told the Pháp luật Thành phố Hồ Chí Minh (HCM City Law) newspaper.
Seeing the market prospects in the coming years, the company decided to build more factories to increase capacity from 2.5 billion to 5 billion gloves per year.
The investment did not mean they expect the pandemic to continue, but the pandemic means many people have started to wear gloves to protect themselves and family members, while many countries are building up national reserves of medical products, said Phu.
Wood products also received a lot of good news. Le Thi Xuyen, general director of Thuan An Wood Processing JSC, expressed her surprise at the increasing orders in the early months of this year.
Many of its customers cancelled orders in the same period last year and the company went more than a month without work because of the pandemic, she said.
Orders exceeded more than 30 per cent of the company’s capacity, she said. Due to COVID-19, people were working more from home, so they needed to buy new beds or wardrobes to create a nicer space and they also spend more time online shopping, so demand increased,” said Xuyen.
She said that her company’s wood products mainly go to high-end markets such as the US, accounting for 40 per cent of production, and 15 per cent exported to the UK and the rest are to other markets.
Explaining this, Michael Kokalari, chief economist of VinaCapital Group, said that due to social distancing, employees in developed countries were forced to work from home, so they had to increase their purchase of goods for work.
Vietnam was in a good position to supply these products. The country's export sales soared in electronics and furniture products.
Vietnam could have earned US$300 billion from exports this year but the export revenue stood at just US$281 billion due to Covid-19, said Minister of Industry and Trade Tran Tuan Anh.
Many exports recorded positive growth in 2020 despite the COVID-19 pandemic.