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Over the past 3 years, EU has imposed an import duty of 10 percent on Vietnam-made shoes and decided to remove imported Vietnamese footwear from its generalised system of preferences (GSP) as the period of 2009-2011. The move has triggered many difficulties for Vietnamese enterprises. Recently, EU decided to extend punitive taxes on imports of Vietnamese footwear for a further 15 months, as from Jan. 3, 2010. Facing the status, Vietnamese footwear companies have to manage to maintain their operations and keep laborers…

Khuong Manh Tan, Chairman of Tan Thanh Ltd in Song Than 2 IP, said his company has over the past 3 years managed to maintain production and business. The company’s orders have decreased significantly but it has still tried to exist and keep laborers.

Tan added if laborers quit the company in this time, the company will can not recruit skilled workers when the tax imposition is lifted. The company now has 1,600 workers and needs 200 more ones but if failed to recruit. Therefore, it has to manage to keep laborers and traditional clients. Tan believed that EC can not extend the imposition.

Meanwhile, Truong Thuy Lien, director of Lien Phat footwear Ltd in Di An district, said her company is really tired of the imposition. EU’s extension of imposition now makes many enterprises stand on the threshold of bankruptcy. Lien added her company dares not ink more contracts, due to shortage of manpower. Her company has so far lost about 500 laborers because it can not afford to keep them. Therefore, her company’s 2009 turnover decreased about 40% over the past year.

Besides, footwear enterprises take many measures to keep laborers. The above companies must narrow their production to maintain production and keep workers. Since 2006, Tan Thanh Ltd has decreased about 25% of export volume. Meanwhile, Lien Phat Footwear Ltd has changed export markets to maintain its operations.