PM Asks Adidas to Facilitate Local Firms’ Involvement in Global Supply Chain

Prime Minister Pham Minh Chinh. Photo: VNA

The Vietnamese leader held phone talks with Kasper Rorsted, chief executive officer at Adidas Group on March 1 to discuss measures to promote production and business activities of Adidas in the nation, VOV reported.

The PM expressed his confidence that the German sportswear manufacturer will achieve greater success and continue to intensify its production and business activities locally.

Chinh proposed that the Group continue to promote corporate social responsibility, whilst paying close attention to ensuring welfare and good working conditions for Vietnamese workers.

Furthermore, Chinh shared the Vietnamese Government's priority on green growth and emission reduction, highly appreciated Adidas' commitment to sustainable production and business in association with environmental protection and the efficient use of energy.

PM Pham Minh Chinh held phone talks with Kasper Rorsted, chief executive officer at Adidas Group on March 1 to discuss measures to promote production and business activities of Adidas in the nation. Photo: VNA

He went on to express his wish that Adidas would continue to contribute to promoting economic, trade, and investment co-operation relationship between the country, Germany and the EU.

The Vietnamese PM also acknowledged and outlined that he would direct relevant agencies to study and deal with the group's proposals relating to local business activities.

In response, Rorsted thanked PM Chinh and various Vietnamese Government agencies for always paying attention to and creating favourable conditions for businesses, including Adidas Group. This can be seen through the support given to them to respond successfully with the various difficulties and challenges caused by the pandemic to restore local production activities.

The Adidas chief executive went on to express his impression of Vietnamese success in vaccinating people, including a large number of workers, to ensure safe production and business activities.

The group as a whole are appreciative of the Vietnamese Government's commitments to sustainable development, green growth, and emission reduction, while identifying the nation as an important production area and destination for both German and EU investors.

Moving forward, Adidas will continue to make efforts to take advantage of and confirm development opportunities in the country as suggested by the PM, the Adidas leader added

German enterprises plan to expand operations in Vietnam

German enterprises in Vietnam have expressed their confidence in positive developments this year. Photo: Ministry of Planning and Investment

Despite being affected by the Covid-19 pandemic, German firms have planned to expand their business in Vietnam, Alexander Goetz, Chairman of the German Business Association (GBA), has said, as cited by VietnamPlus.

2021 was a difficult year for German companies as the pandemic has left a serious impact on them, regardless of industry and size. However, he said, they have tried their best to comply with all regulations issued by the Vietnamese government and secure health and jobs for labour force as well as avoid supply chain disruptions.

The highlight for the German business community was the campaign to call for vaccine donations, which started last October. Thanks to the support of GBA members, they have succeeded in convincing the German government to donate 2.6 million doses of AstraZeneca Covid-19 vaccine to Vietnam.

This was an unprecedented act of the German government to support companies abroad, showing the importance of bilateral trade between the two countries.

The Vietnamese government has issued several policies to support businesses including deferral of tax and land lease payments, one-time support for employees, unemployment insurance and corporate income tax reductions for companies with a turnover of less than VND200 billion VND (USD8.7 million). Those incentives help businesses recover partially, but expenses for Covid-19 prevention like testing and extra allowances for employees remain much higher.

According to Goetz, Vietnam remains a strategic investment destination for European corporations and enterprises. More than 65% of the respondents of a recent survey conducted by the German Chamber of Commerce (AHK) believed that the Vietnamese economy would recover in 2022.

Over the last year, the number of new investments from German companies was quite low. This, however, did not reflect a decrease of interest of German investors in doing business in Vietnam. It is just simply a slowdown due to travel restrictions and lockdowns.

"We believe that many investors are ready to reschedule their visits to the country in the first half of this year," he said.

The EVFTA is a key driver for the optimism of German companies in Vietnam. It gives European companies better opportunities to expand further in the market, he told Dau tu (Vietnam Investment Review).

The adoption of a flexible anti-pandemic strategy will ease the constraints and solve bottlenecks for an economic bounceback in Vietnam this year. With a bilateral trade volume of almost USD15.8 billion, Germany has so far the most important European partner of Vietnam, and with the advantages from the EVFTA, it is expected that there will be more opportunities for potential exploration, partnerships, and dialogue among enterprises of the two countries in 2022.

Regarding investment trends among German firms in Vietnam, the GBA chairman said nearly 50% of them have planned to expand their business to diversify their supply chain, hence reducing the dependency on China, adding that they still focus on industrial strengths such as manufacturing and technical processing and services.

He also said that sustainable energy and infrastructure solutions are segments with very high potential for future investments. Many German companies are leading in these fields and can support Vietnam in the coming time, Goetz said./.

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