Processing and manufacturing firms expect to perform better in Q2

VNS

Up to 89.4% of enterprises in the processing and manufacturing industry expect to perform better in the second quarter of 2019, according to the General Statistics Office (GSO).

Meanwhile, 10.6% said production and business are going to be more difficult.

The predictions are based on a survey conducted by the GSO of more than 6,500 processing and manufacturing firms in 63 cities and provinces nationwide.

About 91.3% of foreign direct investment (FDI) enterprises in the processing and manufacturing industry were optimistic that their business situation in the second quarter would be better and more stable than in the first.

Around 88.8% of non-State businesses and 86.8% of State-owned enterprises also expressed optimism.

The GSO reported that 55.7% of enterprises expected production output to increase in the second quarter while 10.3% of them predicted it would decrease compared to the first quarter.

Production output was expected be highest in the FDI sector, followed by non-State firms and then State-owned enterprises.

About 51% of the enterprises estimated they would receive more orders in the second quarter, while 9.6% said they would receive fewer.

The office pointed out the labour force tends to increase in the second quarter compared to the first quarter, when 22.3% of businesses forecast number of workers would increase. About 7.8% forecast the number would decrease.

It also said several factors affect business and production activities, including the competitiveness of local goods, low domestic demand and financial difficulties.

The competitiveness of domestic goods is still the most influential factor in production and business activities. Up to 59% of the businesses said competition affects production and business activities. About 45% of the businesses believed domestic demand was low while 31.5% of enterprises said they faced financial difficulties.

Meanwhile, 31% of the enterprises said they could not recruit workers to meet their requirements, affecting their ability to develop their production and business.

Twenty-eight% of the enterprises said interest rates were high and 24% faced shortages of raw materials and fuel that affected production. Around 22% of the enterprises had outdated technology and equipment.