Leather footwear development treads new ground

One of the leading sectors in terms of export revenue, the Vietnamese leather footwear sector is strengthening its position on the international market. However, Diep Thanh Kiet, the vice president of the Vietnam Leather and Footwear Association, said that the leather footwear sector still shows weaknesses that hinder its sustainable growth, so this sector is taking synchronous measures to overcome those weaknesses.

The year 2010 marks strong growth of the domestic leather footwear sector. In the first 10 months of 2010, this sector made export revenue of more than US$4 billion, up 24.8 percent compared with the same time of 2009. Leather footwear companies received many export orders and the export price increased about four percent compared with 2009. Hence the leather footwear sector is confident of the feasibility of the US$5.4 billion export revenue target set for 2010.

Despite positive export results, Diep Thanh Kiet admits that leather footwear sector still shows weaknesses that hinder its sustainable growth. Those weaknesses include the lack of materials, unstable workforce, low competitiveness in comparison with leather footwear exporters of other countries, and trade barriers from importing countries. These are difficulties that the sector must overcome to obtain sustainable development.

To deal with the above problems, recently the Vietnam Leather and Footwear Association coordinated with the Vietnam Leather and Footwear Research Institute to work out a development plan for the domestic leather footwear sector in the 2010-2020 period with a vision towards 2025. This was a timely action allowing the leather footwear sector in general and each leather footwear producer in particular to be aware of their strengths and weaknesses.

Gradually increasing the local contents of leather footwear products is the first solution proposed in the above mentioned plan. Actually, the Vietnamese leather footwear sector still has to import 50 percent of production materials, so the surplus value that it obtains is inconsiderable in comparison with the annual export revenue. To increase the local contents of leather footwear products, the Vietnam Leather and Footwear Association will provide companies that are involved in developing the tanning technology with assistance in executing administrative procedures, hiring production space, seeking Government support and financial assistance from other companies.

Currently, European countries – the traditional export markets of the domestic leather footwear sector – are imposing a number of trade barriers on Vietnamese footwear exports to the EU. In such circumstances, domestic leather footwear makers must diversify their export markets. They are promoting exports to the US, considering it a strategic market. Domestic leather footwear companies are also seeking ways to penetrate smaller markets such as Turkey, Australia, South America, Africa and Canada.

Developing the domestic market is an important solution. If they dominate the domestic market, pay more attention to building trademarks and are able to make high-grade products, leather footwear companies can do less outwork for foreign companies, build their reputation on the international market and increase exports to make higher revenue.

Market experts in the leather footwear sector have proposed many solutions to promote its sustainable development. Specifically, domestic leather footwear companies must take more care of workers’ lives, apply modern technologies, especially the automation technology and take part in annual design competitions.

The strategic objectives of the domestic leather footwear sector for 2020 are to export US$13-14 billion worth of products, to manufacture 80 percent of production materials domestically and to account for more 60 percent of the domestic market. – VEN

Tags: Vietnam Footwear, Vietnam Footwear Exports, Vietnam leather exports

Posted by VBN on Nov 9 2010. Filed under Garment Textile. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry