VIETNAM PLASTIC PACKAGING INDUSTRY – POTENTIAL AND CHALLENGES AFTER COVID-19

The plastic packaging industry in Vietnam is having a lot of potential for outstanding growth, especially when the domestic Covid-19 pandemic had lapsed.

Opportunity

According to the Vietnam Plastics Association, the import of PP and PE plastic has started to increase, along with the recovery in demand. This is partly due to the relaxation of the Covid-19 epidemic. Signs of partial demand recovery also led to price increases from import suppliers. Sellers began approaching the Vietnamese market with higher preferences than other Southeast Asian markets.

In addition, Thailand’s ban on single-use plastic bags, effective from January 1, 2020, has had a significant impact on the country’s packaging industry.

From that, the prospect of moving production and business of packaging enterprises to Vietnamese markets has been expanded. The reason is partly because our country has not yet issued a ban like Thailand and the domestic consumption of plastic packaging has been increasing continuously.

In addition, when EVFTA is implemented, it will open up many golden opportunities for domestic enterprises to boost exports to the world market.

Challenge

Packaging industry in Vietnam still faces many difficulties. The domestic production cost is lower than that of Singapore and Thailand, combined with the strong increase in F&B packaging demand, so foreign corporations, especially China, are starting to invest in this field.

At the same time, many famous plastic packaging brands of our country have gradually fallen into the hands of foreign businesses such as Thailand, Korea, Japan, … narrow the market share of domestic enterprises.

Therefore, Vietnamese enterprises with small and medium scale are facing pressure from large and foreign enterprises, being dependent on material resources and disadvantages in the technical and technological race.

Therefore, Vietnamese businesses are forced to constantly change and invest more to increase their competitiveness, typically:

  • Focus on investing in high technology machinery, large capacity, quality products and diversified designs to reduce costs.
  • Controlling imported raw materials, focusing on areas with high demand for packaging production, promoting trade but not being too dependent on foreign businesses.
  • Investment in the field of scrap recycling should be invested.

Source: baobianhsang.vn

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