08:35 | 08/12/2017 Trade
(VEN) - The textile and garment sector is expected to earn export revenues of US$31 billion in 2017, US$1.5 billion higher than its US$29.5-billion target. However, experts have said the rise of some textile and garment producing countries would confront Vietnam with fiercer competition.
Data from the Vietnam National Textile and Garment Group (VINATEX) showed that the textile and garment sector earned export revenues of almost US$23 billion in the first nine months of 2017 (up 9.8 percent from the same time in 2016). It is forecast to earn an additional US$8 billion in the last three months of the year, taking the total to US$31 billion in 2017, 10 percent more than last year and US$1.5 billion higher than the 2017 target. The US, Japan and the Republic of Korea (RoK) have become the biggest importers of Vietnamese textile and garment products.
Nguyen Xuan Hong, Chairman of the Ho Chi Minh City Association of Garments, Textiles, Embroidery and Knitting (AGTEK), attributed the achievements to enterprises’ efforts. He added, however, that the decision of the US to pull out of the Trans-Pacific Partnership Agreement (TPP) and the UK’s divorce from the European Union are having a negative impact on the industry. Textile and garment exports were bleak in 2016 and the first half of 2017, and have improved considerably since the third quarter of 2017, as enterprises have bettered production, developed stronger products and satisfied market demand.
Hong predicted that the sector would reach an export growth of 10 percent in 2017 and a higher growth in 2018. While confident of next year’s market prospects, AGTEK representatives said they are concerned about fierce competition due to higher costs of insurance, land and tax in Vietnam compared with other textile-garment countries - Myanmar, Cambodia, and Bangladesh.
Pham Minh Huong, Managing Director of VINATEX, said the world textile and garment market has changed, the middle class market segment has tended to shrink, and the demand for goods with average prices and a short lifetime has increased. This requires domestic textile and garment producers to accelerate production, shorten delivery time, and diversify products and sources of material supply.
Along with seeking conventional outsourcing orders, Vietnamese enterprises should soon shift to purchasing semi-finished materials for production to participate in higher-level stages of production chains. They should also promote sales to ASEAN (Association of Southeast Asian Nations), Eurasian and Indian markets, apart from traditional markets, while attaching importance to developing and maintaining relations with distributors in importing countries.
The state should adopt appropriate policies to attract foreign and domestic investment in fiber production, knitting and dyeing projects, and consider development of smart textile factories, in which internet connectivity and cloud computing are integrated.