IFC Promotes Vietnam’s PPE Production Capacity to Boost Nation’s Resilience to COVID-19

Hanoi, Vietnam, June 9, 2021-As the significant shortage of personal protective equipment (PPE) in many countries has impacted the containment of the COVID-19 pandemic over the past 18 months, IFC is supporting PPE manufacturers in developing nations including Vietnam to supply reliable and quality PPE products to protect frontline health workers and reduce community transmission.

Given the unprecedented pandemic, the global volume demand for high-quality PPE products-face masks, medical gloves, safety glasses and shoes, respirators, coveralls, vests and full bodysuits-increased three to four times between 2019 and 2020. As it takes time to deliver large-scale vaccinations to cover the global population, demand for PPE products is expected to continue growing at between six and nine percent annually at least until 2025, according to a recent study funded by the United Kingdom Foreign, Commonwealth & Development Office (FCDO).

In Vietnam, PPE manufacturing capacity surged with a six-fold jump in production in 2020 and the country has emerged as one of the new PPE suppliers globally. This ramped-up supply was initially driven by textile manufacturers shifting production in response to the health emergency and to mitigate losses caused by cancelled orders for garments.

'Some textile manufacturers who started producing PPE products as an immediate response to the pandemic, are now considering the medium to longer-term business opportunity in this area,' said Vu Duc Giang, Chairman of Vietnam Textile and Apparel Association. 'However, local manufacturers have struggled with insufficient input materials, technical skills and sector knowledge, and disparity between local and international standards to access global market.'

In response, as part of the global PPE advisory program supported by the UK Government, IFC is working with local garment manufacturers through the Vietnam Textile and Apparel Association (VITAS) and national labs through the Directorate for Standards, Metrology and Quality of Vietnam (STAMEQ). The aim is to improve PPE producers' operations and reduce costs by removing unnecessary burdens related to PPE standards and conformity assessments.

A kick-off webinar-PPE Supply and Demand Perspectives-was organized today in Hanoi in collaboration with VITAS. This is the first of a series to boost PPE-related industry knowledge, with a focus on technical requirements and standards for PPE products in different markets.

'The COVID-19 pandemic has tested the resilience of supply chains to the limit, especially on medical supplies including personal protective equipment. The UK believes that the diversification of PPE manufacturing will make the global supply chain more adaptable and prevent future disruption,' said Gareth Ward, British Ambassador to Vietnam. 'I am very pleased that Viet Nam has been chosen as a priority country for this UK government-funded program. Vietnamese companies have a lot of potential to succeed globally with a skilled labour force.'

Over the next 18 months, the project will also support select manufacturers to scale quality PPE production, access reliable supply of materials and equipment, and achieve PPE international standards and certification to expand exports.

'Access to cost-effective and quality PPE products is vital to national COVID-19 responses, helping contain and manage the spread of the coronavirus,' said Kyle Kelhofer, Country Manager for Vietnam, Cambodia, and Lao PDR. 'Promoting production of PPE products in compliance with international standards not only helps increase Vietnam's resilience to the pandemic, but also presents a business case as the PPE global supply chain is diversifying with opportunities for new manufacturers from emerging markets including Vietnam.'

In January 2021, IFC and the UK Government launched a global PPE advisory program to increase the supply of COVID-related PPE products to developing countries-as part of IFC's COVID-19 response and under IFC's Global Health Platform. IFC's platform was launched in July 2020 and includes up to $4 billion financing to increase access to critical health-care services and products to fight the pandemic in the developing world.

About IFC

IFC-a member of the World Bank Group-is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2020, we invested $22 billion in private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity. For more information, visit www.ifc.org.

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