Mongolia: Potential Garment - Textile Partner of Vietnam

To enhance the cooperation, Vietnamese and Mongolian governments and business communities have actively promoted regular bilateral exchanges like trade fairs, exhibitions, conferences and workshops in recent years. Tsolmon Gantuya, third Secretary of the Embassy of Mongolia in Vietnam, said this is the first foundation to create opportunities for enhancing bilateral trade and investment, especially attracting investment from Mongolia to Vietnam in areas such as agriculture, manufacturing industries (garment - textile, leather - footwear, etc). However, such exchanges only partially meet the demand for seeking investment information of businesses of the two countries. To have long-term sustainable cooperation, businesses of the two sides need to get to know well their partners as well as difficulties and advantages in collaborative process to promote cooperation efficiency.

 

Ms Regzenda Sandag said Mongolia has a developed agriculture with 45.1 million horses, goats, sheep, camels, cows and other livestock. Thus, it can supply hides for leather tanning industry and high-quality fur for the spinning and textile industries. In order to promote its agricultural and industrial strengths, the Government of Mongolia is stepping up many practical action plans to enhance economic competitiveness and improve international economic integration efficiency. Mongolia currently exports hundreds of items to the European Union (EU) with low tariffs and is negotiating a free trade agreement with Japan. Hence, when investing in Mongolia, especially into industrial zones, foreign investors in general and Vietnamese investors in particular will enjoy a lot of incentives like tax reduction or exemption, financial support and personnel training support.

 

Regarding the prospects of garment and textile cooperation - a key export sector of Vietnam in general and Ho Chi Minh City in particular, she said, as one of 12 member countries of blueprint Trans-Pacific Strategic Economic Partnership Agreement (TPP), Vietnam can benefit a lot from tax cuts on garments and textiles. For its part, Mongolia is accelerating the construction of a specialised industrial zone for garment - textile industry. Knowing that the strengths of Vietnam's garment and textile industry lie in technology and engineering while Mongolia has the advantage of abundant material resources, Regzedmaa Sandag expressed her expectation that Mongolia and Ho Chi Minh City will boost cooperation in the garment and textile industry by exchanging experience and expertise and seeking suitable cooperation methods on the basis of mutual benefit, thus boosting the development of this dynamic industry.

 

Tran Xuan Dien, Deputy Director of the Ho Chi Minh City Department of Industry and Trade, said, “The prospects for cooperation in the textile industry between Ho Chi Minh City and Mongolia are great. The city has many advantages in labour force, production capacity, supply chains and diverse export markets, while Mongolia has advantages in material resources, support policies and attractive incentives. However, language barriers, geographical distance and consumer trends pose big challenges to businesses of both sides.”

 

Nguyen Binh An, Deputy Director of the Southern Office of the Vietnam Textile and Apparel Association (Vinatex), said Vietnam's garment and textile industry has enjoyed steady growth for the past 15 years. At present, the Vietnamese garment - textile industry achieves an average annual growth of 15-20 percent, turns out 3 billion products per annum and employs approximately 2.5 million workers. To accelerate the development of the garment - textile industry and make Vietnam an attractive destination for worldwide garment - textile firms, the Government of Vietnam often introduces policies in support of this key economic sector. Vietnam, however, now meets only about 50 percent of domestic fibre demand while the rest is imported, mainly from China, Taiwan and South Korea. Therefore, Vietnam needs to raise its localisation rate of apparel products. “Vietnam is currently setting up the entire textile and garment value chain, including spinning, weaving and dyeing, for which partnerships with several countries, including Mongolia, becomes important.”