Vietnam's Textile and Apparel Industry in 2009: Feasible US$10 Billion Revenue

 

Business Monitor International (BMI) recently puts forward its judgment. Though Vietnam is a medium textile and apparel producing country, its growth rate shows positive signals and ranks 36^th in the global list of added value brought by the textile and apparel industry. Besides, new exporting markets also show positive signals, especially Japanese market.

According to Vietnam Textile and Apparel Association (VITAS), Asia Fashion Federation (AFF) recently accepted Vietnam to become the sixth member of the federation (Vietnam is planned to become an official member in November 2009). General Director of Vinatex, Mr Vu Duc Giang, states that this will be a new approach for Vietnam’s textile and apparel industry especially in the current global recession and the consuming markets for Vietnamese products being narrowed. The above information promises a new consumption channel, creating a driving force for the industry to develop and gain more new orders.

 

Furthermore, being a member of Asia’s most prestigious fashion association will help Vietnam’s fashion industry enjoy convenience from trade promotion activities for fashion export on global market. The latest information is that three leading garment and textile exporting countries of ASEAN, including Vietnam, Indonesia and Thailand, can possibly establish a coalition by the end of this year with an aim to pushing regional export, cut production cost and unite orders.

 

Also according to BMI, of 17 groups of goods exported to Japan which are worth over US$10, 11 groups of which are in an upward trend. It is estimated that export turnover of garment and textile goods exported to Japan in 2009 will be a 20 percent increase compared to 2008. There are some more new markets like Egypt, Turkey and Eastern Europe. There have been orders to export materials to China as well.

Standing Deputy Minister of Industry and Trade, Mr Bui Xuan Khu, believes that although the textile and apparel industry still encounters many difficulties, if enterprises make the effort, it is still possible for them to reach an export turnover of US$10 billion (US$900 million higher than that of 2008).

 

According to many garment and textile enterprises, different from QI when many enterprises had to shrink their production due to a decrease in the number of export orders, in recent months, especially since mid-June, orders from American and EU partners have gradually stabilized again. A lot of enterprises have got orders for QIII signed. Some large enterprises have even had orders toward the end of the year.

 

General Director of Vinatex Vu Duc Giang, the export turnover of the textile and apparel industry in the first six months of this year reached some US$4 billion, down 4.7 percent compared to the corresponding period last year. However, given the context in which the global demand for garment and textile products fell by 15 percent, Vietnam’s decrease of approximately 5 percent is an acceptable figure. And in fact, many enterprises still achieve fairly good business results. Vinatex’s profit for the first six months still reaches 148 percent of the plan.

 

Representative of Viet Tien Garment Joint Stock Company says that the company currently has to mobilize its working force to fulfill orders which are 20 percent higher than previous months. Nam Dinh Garment Joint Stock has also received orders toward the end of QI 2010.

 

Such large garment and textile enterprises as Viet Thang, Nha Be, Thang Loi and Phong Phu, etc. also get lots of orders between now and the end of the year. Many old partners of large markets have also returned to sign new orders after a temporary time of no business.

Solution to higher added value

According to VITAS, from 15 July, textile – dying – garment workshops of Dong Phuong Knitwear Company with total investment of over US$19 million come into operation in Xuyen A Industrial Zone (Long An province). Recently, Viet Thang Textile Joint Stock Company cooperates with Viet Thang Garment Joint Stock Company to introduce a highly applicable spring-summer fashion collection. Strong acceleration of investment into completion technology brings high profit from added value of products, raises the domestic rate and reduces the burden of dependence on imported materials and supporting materials.

 

Also on 15 July, Gerber Scientific International Vietnam officially supplied accessories and wearing out materials for automatic equipment of the textile and apparel industry and soft material industry. This event helps 230 garment and textile companies across the country which are using equipment of Gerber Scientific International Vietnam shorten the time of receiving goods.