Exporters Of Shoe And Leather Enterprises In Vietnam Are In Deep Trouble Because Of Lack Of Money And Lack Of Electricity.

The Vietnamese government has raised interest rates three times this year to fight inflation, but it has made many enterprises miserable. According to the Vietnam Youth Daily, 19, Vietnam's local exporters complained to the government that they were short of money and power shortages, so that they could hardly manage.

Vietnamese exporters expressed their grievances on the 18 day's online meeting, urged the government to loosen bank lending restrictions and tried to solve the problem of electricity shortage, because these two problems have caused Vietnamese enterprises to face operational difficulties.

Officials from Vietnam's Ministry of industry and trade participated in the online meeting with heads of Companies in Hanoi and Hu Zhiming, aiming to discuss how to increase the volume of exports in the second half of this year.

The report pointed out that all the business representatives complained that the restrictions on lending and high interest rates had already caused insufficient funds. Most enterprises were worried that Vietnam could not achieve the goal of export volume of US $sixty-one billion and two hundred million this year.

The Vietnamese government also restricts some industries' US dollar loans to reduce trade deficits and ease inflation.

The Central Bank of Vietnam raised interest rates three times this year, tightening credit to control inflation rate, and the annual inflation rate increased by twenty-six point eight percent in June.

Ruan Youdong, vice president of the Vietnam Federation of marine products export manufacturing association, criticized that loans were restricted to the sales industry, while the US dollar loans to importers and producers such as fuels, paper, steel and coal industries, "our exporters are the main force in making foreign currencies for Vietnam. Why are they restricted by foreign currencies"?

He asked the central bank to loosen the loan restrictions on exporters.

Hu Zhiming, President of the quality and Wood Industry Association, said that due to shortage of funds and rising interest rates, the industry was unable to pay the cost of production, resulting in only 2/3 of domestic furniture orders last year.

Pei Chunkui, Vice Minister of Vietnam's Ministry of industry and trade, said in the meeting that he would ask the government to loosen the loan restrictions on exporters and send staff to solve problems for enterprises every month.

Apart from the problem of capital, the shortage of electricity has also given the manufacturers a headache. The head of the participating enterprises bluntly said that if the power shortage problem can not be solved immediately, the Vietnamese government's desire to increase export volume is just empty talk.

Ruan Deshun, President of the Vietnam leather footwear and socks Association, said that some industrial areas had encountered the problem of loss caused by no early warning of power failure, with an average of four blackouts a month.

The report points out that over the past few months, Vietnam has suffered from power shortages nationwide, resulting in many business losses.

Ruan Youdong said electricity supply instability has hit the fishing industry, especially in the past three months.

Some fishery processing equipment will encounter ten power failures a day, and the catch will be unable to refrigerate for a large number of deaths. Some catfish processing plants will also reduce output by fifty percent.

Several officials of the Vietnam electric power company blamed the power shortage on several power plants' technical problems, resulting in an electric power company lacking two thousand and six hundred to 27 million watts of electricity. The drought in the country also caused the reservoir's lack of water to affect hydropower generation.