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Thursday, June 20, 2024

AmCham: A clear roadmap needed for economic reopening

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The American Chamber of Commerce in Vietnam (AmCham) has conducted a survey, saying that vaccines are key to enabling a safe reopening and recovery. Businesses need a clear roadmap for economic reopening and recovery now. To understand more about the survey, The Saigon Times interviewed Mary Tarnowka, executive director of AmCham Vietnam. Excerpts:

The Saigon Times: Almost three weeks after AmCham conducted the survey, what do you think about feelings and responses of AmCham members now? 

– Mary Tarnowka: Businesses need a clear roadmap for economic reopening and recovery now. Three weeks ago, 13 percent of our survey respondents had already ceased operations with nearly 50 percent operating under 50 percent capacity. Twenty percent of AmCham Vietnam’s survey respondents in the manufacturing sector already had shifted some production. Another 14 percent had discussions already underway. Those numbers undoubtedly have increased. Once that production shifts, it can be hard for it to return, particularly once production lines are expanded elsewhere.

To what extent do you think the AmCham survey would help the city government adjust their Covid-19 policies to ensure continuity of safe reopening and economic recovery?

– We hope that the survey results help both HCMC and central government authorities recognize the urgency and importance of a coordinated roadmap for economic reopening and recovery for businesses and workers in Vietnam. AmCham and our member companies welcome the Prime Minister’s strategic policy shift to learning to live with the virus safely and HCMC People’s Committee Chairman Phan Van Mai’s desire to join hands together to recover the economy and bring back a new normal. We fully support Vietnam’s dual goals to protect lives and livelihoods and want to partner in that effort.

The manufacturing bubble models created here in HCMC and in other provinces to allow continuity of operations during Covid have been extremely useful as an interim measure. But the models don’t work well for large, labor-intensive factories in the footwear and apparel sector. And they are not sustainable long-term, from a cost, logistical and worker health, safety, and morale perspective.

As we move toward a new normal, in addition to more vaccinations, it will be important to have country-wide coordination of policies, including for transportation, availability of rapid tests, and policies to isolate and remove those infected (F0) rapidly to ensure worker safety and minimize the impact on operations.

In that regard, we welcome the Central Government’s issuance of Resolution 105 on Support for Business During Covid, and the Prime Minister’s creation of a Covid Business Response Task Force led by Deputy Prime Minister Le Minh Khai, to coordinate implementation, as well as the draft plan Ho Chi Minh City has shared to enable a safe reopening and economic recovery.

What would you project about the foreign investment environment in the remaining quarter? Consumer confidence and private spending and other social issues that may affect the FDI sector and manufacturing sector as well? 

– AmCham and our member companies are invested in Vietnam and many want to expand. But now even most expansion plans by existing investors are on hold. With difficulties in obtaining approval for entry of foreign experts to come and meet local government officials and potential partners, new investment plans are unlikely to move forward.

Vietnam is well-placed to benefit as companies seek to diversify global supply chains and decrease reliance on China. But the current mixed signals, disruptions, and delays in a roadmap for managing Covid and enabling reopening and recovery will limit that potential. A lot will depend on ensuring a transparent, equitable, safe vaccine rollout, particularly in HCMC and the hard-hit southern economic region. Eighty-five percent of our survey respondents stated that vaccines are the key to enabling a safe reopening and recovery. Re-establishment of essential food and beverage supply chains also is critical, including the ability of restaurants to reopen and operate, at least for delivery.

A clear, coordinated, and consistent roadmap for reopening and sustainable growth is needed both for business planning, and the well-being and livelihoods of the people. This includes facilitating inter-provincial movement of goods and people. Businesses welcome pilot projects such as HCMC’s proposed reopening plan, and the approach local authorities have taken to receive feedback from the private sector. They can cope with policy adjustments. But, without a light at the end of the tunnel, it will be difficult to sustain business or consumer confidence.

We also look forward to development of a vaccine passport and efforts to streamline both the entry of foreign experts, managers, and investors, as well as domestic travel, as announced last week by the Ministry of Foreign Affairs. And we welcome more acceptance of digital documents, both to facilitate trade and investment during Covid, and to enable innovation and the growth of the digital economy.

How would you see the easing of strict restrictions after September 15? The prolonged lockdown would affect all aspects of society and economy?

– AmCham and our member companies recognize the complexities of the current situation and the stakes at risk. We want to partner with the Government to reopen the economy safely and responsibly. And we think now it is time to begin reopening that door, for our businesses, and for Vietnam, and its people. We also think it is important that the private healthcare system be fully utilized and empowered to address the Covid outbreak and provide other urgently-needed medical treatment, both in-person and via telemedicine.

And anything you wish to say and suggest?

– AmCham is invested in Vietnam’s success. The absolute top concern, cited by 74% of our survey respondents was “worries about the poor and disadvantaged who are impacted even more severely’. Last year, thanks to generous contributions from our members, AmCham donated 250,000 surgical masks, Thermofisher PCR testing and analysis systems, and a fully-equipped Ford ambulance to HCMC health authorities. AmCham now is carrying out another AmCham CARES fundraising campaign. We expect to deliver four Medtronic ventilators, worth over US$200,000, as well as more than US$100,000 of other urgently-needed medical equipment later this month to support the Government’s response.

AmCham CARES has also carried out fundraising to support local NGOs providing food and essential products to those in need, supplementing the Government’s efforts.

We will be carrying out another fundraising campaign soon, jointly with EuroCham and AusCham, in conjunction with 10 top international and Vietnamese chef tastemakers, to support food for the needy. Many of our members also donate generously directly.

AmCham is optimistic about the future of Vietnam and HCMC. We look forward to joining hands to partner with the government in Ho Chi Minh City and the Southern Economic Region, and throughout Vietnam, to enable a safe and sustainable economic reopening and recovery.

By Ho Nguyen Thao

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