Textile, garment sector finds way to restore

With fierce competition with international rivals, textile and garment sector is seen to face difficulties. It is predicted that many small and medium enterprises will lose its order; accordingly it is likely that the sector will get failure in local and export market.

Workers of Sai Gon 3 Textile and Garment Company are working (Photo: SGGP)

The Vietnam Textile and Apparel Association (VITAS) said, the sector’s export turnover reached around US$28.5 billion in 2016, much lower than expectation of US$1.5 billion and completing 92 percent of the goal.

VITAS managers explained that there had been downturn in the world; therefore, all nations faced difficulties in expanding market even big countries like India, China whose export turnover reduced compared to 2015.

In addition, Vietnamese textile was in stiff competition with its strong Chinese, Indian, Pakistani and Bangladesh competitors which enjoy their governments’ preferential policies.

Despite these difficulties, Minister of Industry and Trade Tran Tuan Anh highly lauded the sector because its current market share in giant markets showed a growth; for instance, its market share in the US increased by 11 percent and also in Japan.

When it comes to 2017, VITAS said that the sector will still face difficulties because of fierce competition and strong competitors will continue attract more order than Vietnam thanks to its government’s tariff and foreign exchange preferential policies and political unrest in some countries.

Vinatex added that in 2017, Vietnamese textile and garment sector will not yet take full advantages of EVFTA and TPP which take effect in 2018.

With such prediction, the sector set target of 6.5-7 percent in 2017 or US$30 billion.

As per the Ministry of Industry and Trade, in 2017, in addition to opportunities, the integration will produce challenges for the sector especially for small and medium companies. Local small and medium enterprises can even lose its traditional commodity order which bigger companies especially FDI companies will grasp it. Subsequently, small and medium companies should have long broad and long-term strategies besides the government’s support to overcome the rough time.

The state-run Vietnam National Textile And Garment Group (Vinatex) General  director Le Tien Tuong said that his group strives to push up production by 14 percent compared to last year. The group will make the effort to increase export turnover by 11 percent and import turnover by 9 percent. To complete the goal, Vinatex will focus on expanding its markets more especially key markets such as the US, EU, and Japan.

He petitioned that the government should have policies to encourage local enterprises in implementing of higher export processing methods, namely FOB, ODM and OBM. Moreover, the government should have preferential credit policies to purchase Vietnamese materials and for investment of special equipment as well as organizing promotion fair to attract more customers.

By Lac Phong – translated by Uyen Phuong

Other news

Most view

An auto shop in HCMC (Photo: SGGP)

Auto market waits for import tariff removal

Despite continuous price cuts by auto manufacturers and dealers for the last two months, the market has remained to be gloomy as customers have been likely to wait for price drop to bottom levels when import tariff on products imported from ASEAN will reduce to 0 percent on January 1, 2018.

Banking-finance

VAMC buys nearly VND21 trillion deep debts

Vietnam Asset Management Company (VAMC) purchased VND20,995 billion (US$924 million) of deep debts from credit institutions during the first nine months this year with the price of VND20,619 billion.

Economy

VN textile industry needs to spin a new yarn

Continued dependence on raw and auxiliary materials imports will constrain Vietnam textiles and garment industry from taking real advantage of the various Free Trade Agreements signed by the country, industry insiders say.

Self - introduction

Stock market

180m shares start trading on UPCoM this week

Nearly 180 million shares of four companies will start trading on the Unlisted Public Company Market (UPCoM) on the Hà Nội Stock Exchange on October 16-20.