Apparel Exports Top Full-Year Target

According to Vitas, most garment and textile companies are making a profit because they simply have many contracts. They feel secure about their investments as outputs will be purchased by foreign partners. According to the Import and Export Department under the Ministry of Industry and Trade, the apparel export turnover rose 30 percent over the same period. In particular, traditional markets of Vietnam's garment and textile industry like the U.S., the EU and Japan remain largest importers. The U.S. remained the biggest importer of Vietnamese garments and textiles with US$3.94 billion, up 22 percent year on year, followed by the EU with US$1.18 billion, up 6.7 percent, and Japan with US$691 million, up 14.3 percent. Besides, emerging markets are also Vietnam’s future potential partners, including South Korea. Thanks to strong influences of the ASEAN - Korea Free Trade Agreement, Vietnam’s shipments to South Korea soared 64 percent in the first eight months, a record increase. This is another driving force for the apparel and textile industry to try more in the last months of 2010.

 

Mr Le Van Dao, Vice President of Vitas, said: The garment and textile industry can earn over US$3 billion from exports in the last three months of the year. He added: Many companies lack workers because of many big orders and they have to raise salaries for existing ones. Even, many have hastily recruited workers and provided basic training to fulfil orders. However, to date, a lot of garment and textile companies have invested in upgrading new technologies to reduce working time and workforce while product quality is improved remarkably.

 

Besides, apart from finished garment and textile products, many Vietnamese companies started exporting raw materials in recent years. In 2010, Vietnam expects to earn US$1.9 billion from fibre exports. In fact, the fibre industry has developed relatively well in recent years. Some major economies in the world have started showing signs of recovery, leading stronger for cotton fibres and synthetic fibres. On the other hand, China - a powerful yarn exporter - is facing many trade barriers on global markets. Specifically, China is being currently subjected to antidumping tax in Turkey and Brazil and Vietnam can approach these markets. One reason for the shrinking fibre export of the world’s most populous country resulted from improper planning. As a result, China has to import yarns from Vietnam, Thailand, Pakistan and India after being a net exporter for decades. This positive development is a vast opportunity for Vietnamese garment and textile industry in general and spinning companies in particular to leapfrog in the future, contributing to the prosperity of the whole industry.

The above results show many advantages for Vietnam's garment and textile industry in the future. However, Vietnamese companies still face many risks if they do not pay proper attention to.

 

According to a research by the Ho Chi Minh City Association of Garment Textile Embroidery Knitting (Agtek), the garment and textile industry will face new difficulties if the Government approves of increases in electricity and coal prices. More costs will lead to higher prices, thus blunting the competitive edge of Vietnamese garments and textiles in the world.

 

To solve above woes, according to Agtek, Vietnamese companies need to invest in modern, automated machinery and equipment to boost production. Besides, they only need to improve performance processes because, unlike machines, personnel productivity needs more time to go up.

 

In addition, many industry specialists also warned of receiving so many orders in a short time for a long time operation because of workforce, workload and price fluctuations. Without correct anticipations, companies will be at a disadvantage.

 

In another aspect, global garment and textile industries will regain growth momentums as economies recovered. Hence, Vietnamese should take this transitional time and its advantages of price, supply source and government-backed soft loans to consolidate its internal sources and expand markets. Importantly, they should not excessively focus on export markets while making light of domestic one where they have more priorities and advantages.

 

The Vietnamese garment and textile industry targets to rake in export turnover of US$19 billion by 2015 and US$26 billion by 2020. To achieve these targets, the industry now needs to apply modern technology and equipment to enhance productivity, shorten delivery time and improve governance. Large entities need to restructure to boost competitiveness while smaller ones will serve as satellites for larger ones. Opportune changes will be the key for Vietnamese garment and textile companies to unlock future successes.