Businesses 'struggle' with exchange rates

In the context of a volatile currency market, Vietnamese businesses are facing great pressure from exchange rate changes. However, opportunities are also opening up with many strategies for foreign currency diversification and risk management of businesses.

Exchange rate fluctuations have affected the import-export and production activities of many businesses. However, businesses exporting seafood and agricultural products such as coffee... have more advantages due to the exchange rate difference - Photo: QUANG DINH

On the morning of July 17, at the beginning of the trading session, the State Bank announced the central exchange rate of the Vietnamese Dong to the USD at 25,168 VND. Of which, the USD exchange rate at the State Bank's trading office increased, currently at: 23,960 - 26,376 VND; this is a higher level than the previous session.

Exchange rate fluctuations since the beginning of the year have affected the import-export and production activities of many businesses. Concerned about exchange rate fluctuations, businesses have many plans to adapt and reduce risks.

Need 1 million USD to import goods, exchange rate changes must prepare more than 26 billion VND instead of 23 billion VND

On July 17, speaking with Tuoi Tre Online, Mr. Ta Van Lap (a wood business in Dong Nai province) said that importing walnut wood from the US to Vietnam to make high-end furniture requires a "heavier" cash flow than before.

"To have 1 million USD to import goods, prepare more than 26 billion VND instead of more than 23 billion VND like before. The exchange rate fluctuates strongly, businesses recalculate revenue and expenditure, sales levels after the goods arrive to avoid disruption.

Most import businesses have to convert VND to USD to pay for goods. The difference between buying and selling when the exchange rate fluctuates strongly causes us to lose a large amount of money.

From 2024 to now, the exchange rate has fluctuated continuously, so we have to calculate and store USD to pay for orders, and we also have to be flexible and diverse in storing other foreign currencies to recalculate with partners every time there is a new order," said Mr. Lap.

Meanwhile, Mr. Phan Dinh Quan, director of EZ Shipping Company Limited (a logistics transportation unit in Hanoi ), said that the company's "regular" customers specialize in importing raw materials, machinery and equipment, mainly paying in USD.

However, businesses do not only use USD, some businesses "hedge" other foreign currencies to diversify risks from exchange rate fluctuations.

Mr. Quan said: "Over the past year, political tensions in the world have caused logistics and international shipping costs to increase and remain high. As an intermediary unit to pay the fees for both sides, businesses have to buy more USD. Even other foreign currencies such as euros, pounds, and Japanese yen are also kept ready."

Favorable agricultural and aquatic product export enterprises

On the contrary, when the exchange rate increases, exporting enterprises will benefit more than importing enterprises. The benefits come from the exchange rate, according to some agricultural and aquatic product exporting enterprises, the benefits are clearly visible compared to the same period last year.

According to the leader of a large pangasius exporting corporation, Vietnamese pangasius is a popular product in the US. When the exchange rate fluctuates, the same order output but the revenue "slightly" increases by about 5%.

"Pangasius entering the US market or other markets trading in USD is still very favorable. There is currently nothing unusual about import tariffs, so fluctuations in exchange rates are not optimistic, but we assess that we will benefit from this fluctuation.

However, in the long term, what is most needed is a stable USD exchange rate, so export businesses still need to come up with other adaptation plans," he said.

In addition, some other businesses assess Vietnam as an economy that depends heavily on imports of raw materials, machinery and equipment, mainly paid for in USD.

Vietnamese export enterprises import 50-60% of raw materials and pay in foreign currency, so when the exchange rate increases, the benefits from the exchange rate are there but not much.

Enterprises need to restructure their financial models, reduce foreign currency debt, and increase cash flow management capacity.

According to Mr. Le Trung Nam, an economic expert in Ho Chi Minh City, the USD/VND exchange rate increasing by 10-12% since the beginning of the year is a big fluctuation, requiring businesses to proactively review the entire value chain to assess the level of risk.

Specifically, importing enterprises need to renegotiate payment terms, extend cash flow or increase localization ratio. Enterprises borrowing USD must re-evaluate debt repayment cash flow to avoid exchange rate risks affecting payment capacity.

"In the long term, it is necessary to restructure the financial model, reduce the proportion of foreign currency debt, and increase cash flow management capacity. At the same time, businesses should proactively use exchange rate risk hedging tools such as forward contracts, although the market is currently limited.

Exchange rate fluctuations are inevitable, but businesses can proactively respond if they build an effective and flexible financial management system. This is the time to review capital structure, operational efficiency and macro forecasting capacity, instead of just reacting passively," Mr. Nam emphasized.

NEGOTIATION

Source: https://tuoitre.vn/doanh-nghiep-cheo-chong-voi-ti-gia-20250717102748452.htm