11:47 | 27/01/2020 Industry
(VEN) - Free trade agreements (FTAs) are offering the textile and garment industry great opportunities to develop and expand export markets around the world.
Applying science and technology to green the textile and garment industry
In 2019, despite being greatly affected by the world economic downturn as a consequence of political fluctuations and trade conflicts between major economies, especially the US-China trade war, Vietnam’s textile and garment industry experienced good growth. Although it did not reach the US$40-billion export value mark as expected at the beginning of the year, the industry earned US$39 billion from exports, about 7.55 percent higher than 2018. The trade surplus of textile and garment exports totaled US$19.73 billion, up 10.19 percent from 2018.
The US became the largest importer of Vietnamese textiles and garments with an estimated export value of US$15.2 billion, up 8.9 percent from 2018 and accounting for 38.97 percent of the country’s total, followed by the EU with US$4.4 billion (accounting for 11.28 percent of the total), and China with US$4.25 billion (10.9 percent).
Vietnam has become the biggest textile and garment exporter in ASEAN (the Association of Southeast Asian Nations) and one of the largest textile and garment exporters in the CPTPP (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) bloc. Notably, textiles and garment exports to such discerning CPTPP markets as Australia, Canada, and New Zealand have increased.
EVFTA, CPTPP opportunities
According to Vu Duc Giang, Chairman of the Vietnam Textile and Apparel Association (VITAS), a series of trade agreements that Vietnam has signed, including CPTPP and the EU-Vietnam Free Trade Agreement (EVFTA), have created a large playing field for textile and garment enterprises.
Fabric and yarn enterprises are waiting for the EVFTA to take effect so they can boost exports to the EU. The agreement stipulates strict requirements of product origin in order to enjoy trade preferences. Accordingly, textile and garment exports to the EU must be produced with fabrics made in Vietnam, and tailored in Vietnam or Europe.
According to the CPTPP, all three production stages of fabric spinning, knitting and completion must be done in a CPTPP country. This requires Vietnam to build a domestic textile and garment material supply chain. The VITAS chairman said this issue needs to be addressed by the textile-garment industry together with the government, state management agencies and localities.
The textile and garment industry is stepping up its sustainable development strategy implementation to meet the requirements of major foreign markets. Manufacturers in the sector have applied advanced science and technology to green the industry, apart from training human resources.
|VITAS set a target of US$59-60 billion per year by 2030 and US$85-90 billion in 2035-2040 in textile and garment export value, with 15-20 percent of all exports being Vietnamese brands.|