Several Vietnamese companies have transferred manufacturing operations overseas.
DrClean handwash dominates the market
Many products such as Dr. Kool toothbrushes and Dr. Clean handwash, which are made in South.Korea and Thailand, are favoured by supermarkets and customers. Dr. Clean products especially have dominated domestic market, and they are actually owned by a Vietnamese corporation, Sao Nam Group.
The director of Sao Nam Group Pham Cong Sinh said they send designs and brand names to their manufacturing partners overseas and import the goods to Vietnam as the distributor.
The deputy head of the Ministry of Agriculture and Rural Development, Nguyen Thi Xuan Thu, said many companies are producing pesticides and preservatives overseas as well in order to avoid inspection on quality and licenses. Thu also said that it is difficult to manage these commodities.
Vu Vinh Phu, President of Hanoi Supermarket Association, said those products that are sold for higher prices than the same ones made domestically because they incur higher overhead costs, such as labour wages, import taxes and transport fees.
DrKool toothpaste in Unimart Supermarket
"Vietnamese people often prefer foreign products over domestically-made ones, so those companies still make more profits than others. The downside is that customers refuse to buy domestically-made products, which may cause Vietnam to suffer from labour surplus and leave the government unable to collect corporate taxes." he said.
He went on to say that, due to lack of legal framework, these companies have not violated any regulations. However, government needs to issue suitable policies to encourage people to buy domestically-made products and to attract manufacturing back home. In fact, Vietnam's supporting industry is so weak that companies are forced to import a vast majority of goods, which makes them reluctant to open factories in Vietnam.
Meanwhile, expert Hoang Tho Xuan raised doubts about the quality of such products. He said, "We need to tighten control over these products basis of decrees on anti-smuggling and trade fraud."
