Garment makers target $13b in exports

The textile and garment sector has targeted a monthly export turnover of US$1 billion per month in the last five months of this year in order to realise its annual objective of around $13 billion.

“In 2010, the industry turned over roughly $1 billion per month in the last four months of the year,” said Le Tien Truong, deputy director general of the National Textile and Garment Group (Vinatex).

“It is not easy to hit that figure in the earlier months of the year, as most contracts for this period are for summer products that cost less,” he added.

The industry exported $11.2 billion of goods last year, up 23.2 per cent against the previous year, becoming the fifth largest textile and garment exporter in the world.

The US market took the lead with roughly $6 billion in value, followed by the EU with $1.8 billion, and Japan with $1.2 billion.

Last year, the sector spent roughly $6 billion on importing raw materials and accessories to make products for export.

To ease the dependence on imported materials and accessories, the sector as well as Vinatex would make bold investments to source these materials from the domestic market, Truong said.

Vinatex has set a target of more than $2.5 billion in export value this year, up 20 per cent from one year ago.

To realise the target, the group would co-ordinate with PetroVietnam and other companies to pump around VND2 trillion ($95.2 million) into building and developing specialised industrial zones (IZs) and textile and fibre factories, he said.

They included Dinh Vu – Hai Phong, Pho Noi B – Hung Yen, Dong Van II – Ha Nam, Hoa Xa – Nam Dinh, Nam Dan – Nghe An, Hai Lang – Quang Tri and Phu Bai – Hue. The investment would help add 31,300 tonnes of fibre to the group’s total output.

The group plans to inject around VND1 trillion ($47.6 million) to further expand garment factories in a bid to raise output this year.

“The group will make great efforts to remodel equipment and technologies to raise its production by 14 per cent and then boost exports and expand the sales network this year,” said Truong Bach Mai, chief of the Vinatex administration office.

Vinatex estimated it would increase the average income for workers by 10 per cent and generate an additional 10,000-15,000 jobs this year.

With rising production costs in China, many Japanese garment enterprises plan to shift their production from China to Southeast Asia, including Viet Nam, according to the Viet Nam Textile and Apparel Association (Vitas).

Nguyen Son, Vitas representative, said that under the Viet Nam-Japan Economic Partnership Agreement, garments produced in Viet Nam would enjoy preferential import tariffs when entering the Japanese market.

In recent months, Vinatex has received many Japanese investors who proposed investments in textile and garment projects in Viet Nam.

Takeo Nojo, managing director of Shikibo, said his company was considering opening a factory to produce spun yarn in Viet Nam.

He said his company wanted to find a Vietnamese business partner capable of the entire garment process, from the spinning of yarn to sewing and finishing products.

Similarly, the Japanese Marubeni Corp is seeking opportunities to join hands with Vinatex to build garment and textile plants in Viet Nam for the Japanese market.

Katsuhisa Yabe, head of Marubeni’s textile department, said the company had gradually started switching its orders for uniforms to Viet Nam from neighbouring China.

It also planned to place orders for Vietnamese high-end clothing items in the near future.

The higher labour costs in China, coupled with stricter regulations on energy consumption and environmental protection set by the Chinese government, have pushed up prices of garment products, according to experts.

South Korean and some Chinese companies also planned to shift their factories to Viet Nam. However, local authorities around the country should place top priority on environmental protection when approving an investment project and encourage development of clean production projects, experts said. — VNS

Tags: Vietnam garment exports, Vietnam Garment industry