Sanctions of the US and the West on Russia are causing Vietnamese export orders to be delayed and payment jams.

In the past few days, Mr. Phan Minh Thong, General Director of Phuc Sinh has been constantly contacting customers in Russia and Europe to inquire about the situation and especially, to solve the backlog of orders and payment documents. .

This enterprise annually exports about 30 million USD of coffee, cashew nuts, pepper… to Russia. Particularly since the beginning of the year until now, orders to Russia have doubled in the same period of 2020. When the Russia-Ukraine conflict occurred and Western countries imposed a series of sanctions on Russia, Phuc Sinh’s export orders were stopped. .

The exclusion of Russia from the Association of International Financial and Interbank Telecommunication (SWIFT) system caused orders to Russia to be halved in value because the ruble depreciated, and payments were delayed.

According to him, partners in Europe and Russia are also facing unexpected difficulties due to sanctions, so orders have been delivered but payment is stuck.

Not only Phuc Sinh, the leader of another fruit and vegetable export business to Russia said that he is also having to stop orders due to difficulty in transporting goods. Export documents to Russia were also rejected by banks because payments between Vietnamese enterprises and partners have been made through the SWIFT network for a long time.

“International carriers do not accept goods, flights to this market are also limited. Therefore, goods are stopped, and payment is not possible”, this person shared.

Russia is a potential market for Vietnam, both in terms of import and export. Customs data shows that in 2021, Vietnam exports to Russia 3.2 billion USD; imports from this country 2.3 billion USD, up 15%.

Main export items to Russia, including phones and components (accounting for 33% of Vietnam’s turnover to Russia); computers and electronic products (13%), textiles (10.5%), coffee (5.4%), seafood (5.1%).

As for Ukraine, the export turnover is not large, less than one billion USD, but this country is a traditional and important trading partner of Vietnam in the Asia-Europe region. In 2021, the trade turnover between the two countries will reach 720.5 million USD, an increase of nearly 51% over the same period in 2020. Fisheries, footwear, electronic computers… are the main export products of Vietnam. to this country.

According to the leader of the European and American Market Department (Ministry of Industry and Trade), Vietnam will be significantly affected, directly and negatively on production, import and export, inflation, supply and demand; transportation, circulation of goods, payment of commercial contracts… Enterprises with cooperation projects with Russia, Ukraine, Belarus and other countries involved in the crisis will also be affected.

“This crisis has profound, comprehensive and negative effects, in the immediate and long-term, on the economy, trade, finance, and the global production and supply chains of the world as well as Vietnam.” Asian and European market department comments.

The first is the supply of raw materials and fuels when this conflict is one of the main reasons for the increase in gas prices – petroleum, wheat, aluminum, nickel, corn… due to the production and export market share. Russia, Ukraine with these large items.

The payment of commercial contracts with Russia will also be difficult, after the US and Western countries launched a series of sanctions targeting Russia’s banking system, freezing the assets of the Central Bank of Russia.. .

These punitive steps will affect the settlement of many contracts using USD payments in the immediate future. Ruble’s devaluation was so strong that some Russian importers asked to stop paying for 2-3 weeks to wait for the situation to stabilize.

Currently, a number of shipping lines have refused to accept orders to transport goods from Vietnam to Russia. Freight rates will continue to soar along with shipping delays that will severely affect trade in goods.

In addition, the air embargo also causes airlines to choose longer routes, increasing costs, increasing pressure on the global logistics transportation system and goods prices. According to businesses, the cost of transporting exported goods has been too high recently, the freight rates continue to increase, causing costs to be greatly increased and they may “no longer have any profits”.

Not to mention, the depreciation of the ruble will reduce Russia’s ability to import. Enterprises exporting to this market will have to recalculate the cost and market problem.

According to the Department of Markets for Europe and America, bilateral trade between Vietnam and Russia will inevitably have negative effects if the US and the West continue to increase strong and comprehensive financial sanctions against Russia. This agency recommends that enterprises exporting to the two countries should actively work with import partners on payment, delivery schedule…

From many years of export experience, Mr. Phan Minh Thong, General Director of Phuc Sinh Group also said that at this time, it is best for businesses that have goods to go to Russia to bring them back and find ways to sell to other markets to avoid risks. ro.

In this aspect, the Asian and European Market Department noted, businesses also need to make the most of the incentives in free trade agreements between Vietnam and other countries to diversify markets. In case businesses have difficulty exporting goods to Russia and Ukraine, they can contact the Vietnamese trade in these two countries for support and find a solution.

At the Government meeting in February, Prime Minister Pham Minh Chinh directed the establishment of a special working group to promptly deal with and respond to the impact of the Russia-Ukraine conflict on Vietnam.

By VnExpress