Vietnam textiles and garments are at risk of losing contracts if COVID-19 is not controlled

Garment manufacturing workers at a textile company in Vietnam

Some Vietnamese textile and garment enterprises said that they are under pressure to cut contracts from foreign partners if workers have not been fully vaccinated against COVID-19 and because of problems controlling the COVID-19 epidemic from the Government.

The state-controlled media on September 20, citing information from the leader of Dony Garment Co., Ltd., said that this business currently only has one third of the workers involved in production compared to before the COVID-19 epidemic, so it only reached about approx 20% capacity. According to a representative of the company Dony, although 100% of the “3 on-site” production workers have been vaccinated, the delay in delivery makes European partners say they can’t wait and threaten move orders to production in other countries.

Leaders of Garment 10 Company affirmed that foreign partners always question when the Vietnamese Government can control the epidemic and when garment enterprises will stabilize production. A representative of Garment 10 Company said that the partners also threatened to terminate the contracts in the fourth quarter of 2021 and the first and second quarters of 2022 if the vaccination rate for workers did not meet the required standards.

Some garment enterprises have sent letters of appeal to the Prime Minister of Vietnam. The letter dated September 10 affirms that garment businesses are facing bankruptcy because most customers have canceled orders and requested to ship goods by plane with the remaining contracts.

According to the above letter of appeal, garment business customers said that they could not wait too long, on the other hand, the manufacturer had spent thousands of billion dong to buy raw materials.

Garment businesses warn that the blockade situation causes the risk of losing orders to 2022, leading to the risk of losing production seasons and losing markets.

According to statistics of the state-controlled media, the export turnover of textiles and garments in August 2021 decreased by 9.2% compared to the same period last year. (Translated)


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