Textile and Garment Enterprises Should Be More Dynamic

After Vietnam joins the World Trade Organisation (WTO), textile and garment enterprises should be more dynamic, overcoming shortcomings and promoting their co-operation to increase their competitiveness. So said Dang Phuong Dung, general director of the Garment 10 Company and managing director of the Vietnam National Textile and Garment Group.

 

One of the shortcomings is low added value in exported products of Vietnam. We have so far acted as subcontractors, making products as required by customers. We have not made many products of local materials. Moreover, Vietnamese enterprises remain weak in design, brand development, promotion and marketing.

Years ago, we developed a strategy for Vietnamese textile and garment enterprises for the 2010-2015 period and throughout until 2020. We will strive to make around 1.2 billion square metres of cloth for export in 2010. In the past, Vietnamese textile and garment enterprises enjoyed support with soft loans from the State under the Decision 55. However, under Vietnam’s commitments for its WTO bid, we no longer enjoy such support. We have to rely on our internal strength and expand multi-ownership. This will be a solution for Vietnamese enterprises and they have to know how to win contracts and orders from customers.

 

Each country has its own policies on self-defence to protect its economy and local enterprises. The US is not an exception, so it will not allow Chinese goods to flood its market easily. In2008, if a barrier is removed, perhaps another will be put in place. At present, China is facing some pressure during its development process. These are pressures of incomes for workers and infrastructure development, which cannot keep up with the country’s overheating growth. These are also barriers to China’s development. However, Vietnamese enterprises should not rely on these factors. Instead, they should try their best.

 

The short-term threat to Vietnamese textile and garment enterprises is very clear. China is a huge market, one which we cannot compete with. However, time remains from now to 2008 for us to make preparations for coping with the threat.

 

Supervision and control are unavoidable. So, our enterprises should be transparent. This is a requirement for international integration. Vietnam is used to small-sized production, all management issues are made generally and manually. However, it is required to apply concrete calculations for each product with a better examination system. At present, we also have to observe the regulations of foreign countries and partners.

 

Another issue is that Vietnamese enterprises should not concentrate on a single “hot” product or category, which may result in reaction from import countries and self-defence measures may be applied. China is a good example. In 2005, after China enjoyed free trade, some exported goods from China to the US witnessed a hundred fold increase and resulted in quotas being applied to those goods by the US. This will not depend on enterprises only. Enterprises need support from the Government and business associations to help with their guidelines.

 

Vietnamese enterprises should become more dynamic but at the same time, they should co-operate with foreign partners to increase their competitiveness.