Gia Lai makes the most of EVFTA

Impressive first half performance

Gia Lai province has two companies permitted to export agricultural products to Europe under the Europe- Vietnam Free Trade Agreement (EVFTA), including Dong Giao Foodstuff Export Joint Stock Company- Giai Lai branch  (Doveco Gia Lai) and Vinh Hiep Company Limited.  

All the production steps of the two companies from cultivating, caring, harvesting to processing comply with the strictest requirements from the European market. As a result, the two companies’ farm produce has been popular in the European market. Only in the first six months of 2021, they both exceed 100% of the export target compared to the same period last year.

Director of Dong Giao Foodstuff Joint Stock Company - Gia Lai branch, Dinh Gia Nghia said in the first six months of the year alone, the company’s export volume is 125% over the same period last year. That impressive achievement is the result of the fact that the company’s products meet all strict requirements from importers; thereby having many advantages in signing contracts with partners. At the same time, the company has also proactively removed obstacles in shipping and container.

For Vinh Hiep Company Limited which is allowed to export dried agricultural commodities including coffee and pepper to Europe under EVFTA, exporting figures in the first six months of the year is also very impressive. The Company’s director, Thai Nhu Hiep said that over the give period, the company exported 80,000 tons of coffee, up 130% over the same period in 2020.

Assessing the agricultural product exports in the first six months of the year, Deputy Director of Gia Lai Department of Agriculture and Rural Department, Doan Ngoc Co said: “The province’s agricultural product exports in the first six months of 2021 were very positive. During that period, the covid-19 pandemic was under control; so harvesting, purchasing and processing took place conveniently.”

For Doveco Gia Lai, the company has a passion fruit cultivation area of around 6,500 hectares. In the first months of the year, the company well-organized the purchase of passion fruits for growers. The processing at the company’s factory was advantageous because the pandemic had not yet spread widely during that period, workforce at the factory was always guaranteed.

In addition, exporting went very well because the company exported goods via ports in Quy Nhon and Da Nang – both provinces controlled the pandemic effectively.

Facing difficulties in the last months of the year

Since the beginning of the July, Gia Lai’s farm produce exports have encountered difficulties in the face of Covid-19 resurgence. Thai Nhu Hiep, Director of Vinh Hiep Co,. Ltd said that the company’s export activities have been affected considerably since the beginning of July when the pandemic broke out again.

 “Our goods are primarily exported via major ports in the Southern region like Dong Nai, Binh Duong and Ho Chi Minh City while the pandemic has deepened the gap between shipping lines and containers. In addition, staffs in charge of delivery, dealing with administrative procedures and drivers are facing difficulties when return from the pandemic areas. They are forced to isolate in accordance with Directive 16 of the Government,” Hiep shared.  

Also according to Hiep, the company’s 20,000 tons including coffee and pepper now pile up and are unable to be exported. Due to the impact of the Covid-19 pandemic countries are taking measures to combat the disease. Besides, the shortage of ships, empty containers as well as vehicles and labors is a cause for the high inventory levels.

 “Currently, the large industrial zones in Binh Duong and Dong Nai  and Ho Chi Minh City where the Company’s branches are situated are almost paralyzed due to the pandemic. So, the company’s exporting activities are facing countless difficulties. Accordingly, input cost increased because inventory couldn’t be exported, the company has to hire warehouses to store the products. And, labor costs are another problem,” said Hiep.

If in the first six months of the year, Dong Giao Foodstuff Export J.S.C – Gia Lai branch experienced favorable conditions, export volume increased sharply, currently the company is facing countless difficulties. Dinh Gia Nghia, director of the company said: “At present, we have abundant supply of raw materials however we are lack of workers. Normally, we need almost 600 workers at the factory to operate at full capacity. Currently, there are only about 300 workers working at the factory because of social distancing measures.”

To overcome the above challenges, Nghia said the only way is to strictly comply with “5K” measure and Directive 16 of the Government on the Covid-19 prevention and control. In addition, the company proactively made specific plan to ensure safety for employees by implementing social distancing measures, shift work. And, at the same time the company has taken measures on supporting employees in the context of complex development of the Covid-19 pandemic.

For Vinh Hiep Company Limited, Thai Nhu Hiep said first, it’s necessary to strictly follow Directive 16 of the Government. At factories and processing zones, it’s necessary to implement shift work to ensure social distancing. “The aim is to maintain production and to absolutely ensure the safety. More than ever, now businesses and workers should stick together to share difficulties and overcome the pandemic,” Hiep shared.

On the local side, the province’s authorities timely understood the situation and direct relevant departments and agencies and localities to proactively come up with suitable solutions in order to help enterprises, local farmers overcome difficulties, ensure production and exports.

Deputy Director of Gia Lai’s Department of Agriculture and Rural Development, Doan Ngoc Co said at all costs, authorities must find effective ways to facilitate production and export activities of the enterprises which means creating favorable conditions for farmers to harvest and selling farm produce, avoiding great losses for local people.

 “Currently, the warehouse system of the company is capable for storing inventory. However, the local processing system need to overcome difficulties, enhancing operations safely to ensure the purchase and processing all farm produce for farmers,” Doan Ngoc Co emphasized.

In the first six months of the year, import and export activities in Gia Lai province took place impressively. Particularly, export turnover in the first six months of the year were estimated at US$315 (reaching 51.64% of the planed target, up 25.84% over the same period in 2020). Value of export increased was mainly due to the rise in export prices and export volume of agricultural products, especially pepper, natural rubber, coffee and fruits. Besides, it was also because the supplies in some Vietnam’s rival countries  dwindled  due to the impact of the Covid-19 pandemic while during that period  the pandemic was well-controlled in Vietnam, resulting in smooth production and export activities. In addition, the EVFTA took effective, creating favorable conditions for the enterprises to maintain and expand the market for exports.