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Focus on exports leads to shortage
Many companies are forced to import raw materials because local firms producing them prefer to export than sell domestically.
In the rubber sector, for instance, some subsidiaries of the Vietnam National Chemical Group face a shortage of latex and have asked the Vietnam Rubber Group (VRG) to sell to them. But VRG turned down their demand saying exports are its priority.
The Sao Vang Rubber Joint Stock Company, Da Nang Rubber Joint Stock Company, and the Southern Rubber Industry Joint Stock Company have been forced to buy latex from less reliable domestic sources or import.
Vietnam is among the five biggest producers of natural rubber in the world but the three companies, who meet 60-80 percent of the country's demand for tubes and tires, face a shortage of rubber.
Similarly, many industries that require large volumes of coal, like electricity, cement, and steel, face a shortage of coal and have petitioned the Vietnam National Coal Mineral Industries Holding Corporation Limited (Vinacomin) to supply over and above their contracts.
But Vinacomin is focused on exports, mainly because export prices are higher than domestic prices, reports the Nguoi Lao Dong (The Labourer) newspaper.
Its bosses claim that Vinacomin has to export to maintain its profitability since it makes losses selling domestically.
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