Page 26 - FDMAsia Jul/Aug 2026

24 FOCUS JUL/AUG 2026 FDM ASIA | www.fdmasia.com

PICRYL companies without effective risk management systems and
supply chain optimisation strategies could see profit margins
eroded by rising compliance costs.
In response, many exporters have begun restructuring
operations and shifting from passive production models to
proactive supply chain optimisation, from sourcing materials

to manufacturing, packaging and transport.
Experts said the green transition and supply chain upgrading
process requires substantial financial and technical resources,
making stronger policy support essential, particularly for small-
and medium-sized enterprises.
The ministry will also strengthen training programmes on
risk management and coordinate with financial institutions to
Vietnamese exporters operate, with supply chain standardisation help businesses access preferential financing for production
and digitalisation becoming essential to remain competitive modernisation and compliance with international standards.

in global markets.
Beyond stricter standards, many export industries are also EUDR, export enterprises must fully digitise
grappling with prolonged market dependence. Despite rapid European Union (EU) has just announced the latest update
export growth, diversification has lagged, leaving businesses to the Anti-Deforestation Regulation (EUDR) effective May 4,
exposed to concentration risks. 2026, with a series of notable changes related to product
Amid rising trade protectionism and tighter technical scope, accountability mechanisms and information technology
regulations worldwide, the strategy of putting too many eggs systems.

in one basket is becoming increasingly risky. Notably, while EU continues to emphasise goal of reducing
Logistics is another major pressure point. According to administrative burden on businesses, core requirements for
Vietnam’s Trade Office in Argentina, in late May 2026, rising traceability, supply chain transparency and control of deforestation
freight costs have become one of the biggest threats to the risks are becoming increasingly stringent.
competitiveness of Vietnamese goods exported to Argentina According to the latest update, EUDR simplifies accountability
and the wider South American market. declaration process for micro and small businesses in initial
Shipping costs from Asia to South America have risen production stage.
sharply due to long distances and extended transit times. EU has also expanded scope of applicable products, adding
International logistics firms estimate that total container instant coffee and palm oil derivatives—products assessed as

shipping costs to South America have increased by 50–80 posing a risk of deforestation in some regions of the world.
percent compared to pre-Red Sea crisis levels. Some 40-foot At EU Regulations Update Conference on Non-Deforestation
container routes have seen rises of several thousand US Products (EUDR), following official announcement of updated
dollars per container. regulations on 4 May, Mr. Cyril Loisel, First Secretary of EU
Vietnamese enterprises face not only risks linked to freight Delegation to Vietnam, stated that the changes could help
costs and exchange rate fluctuations, but also growing pressure businesses reduce their administrative burden by approximately
to comply with new international standards warning that 75 percent.