Vinatex plans $2.1b investment over 10yrs

The Vietnam National Garment and Textile Group, or Vinatex recently finalised its investment orientation strategy for the apparel sector up until 2020 with a total investment of up to 42.95 trillion dong ($2.1 billion), marking the highest level ever.

Le Tien Truong, deputy general director of Vinatex, said that this amount of investment is for 10 year period, averaging at 4.3 trillion dong per year.

The investment fund will be mobilised from various sources including equity raised from investors expected to b around 1.3-1.5 trillion dong per year and the remainder will be derived from bank borrowings.

Under the development strategy, the group said the investment would enable it to achieve an annual increase of 12 percent-14 percent in production value and a 15 percent surge in export turnover.

To achieve these targets, Vinatex will build key factories, especially facilities for producing raw materials, invest in new equipment and technology, and boost productivity.

The group targets to produce 300,000 tonnes of fibre by 2020, 675 million square metres of fabric and 706 million garment products per year with the export turnover of more than $5 billion, Truong said.

Accordingly, the group will develop 31 fibre plants, 21 fabric factories, and 164 garment plants in the next decade, Truong added.

Vinatex will also expand its raw materials zones in eight provinces including the Central Highland provinces of Dak Lak and Dak Nong, and Ninh Thuan province as well as the northern mountainous province of Son La.

Vinatex will also strive to increase the added value in its products. To achieve this, Truong said, local clothing manufacturers should increase the ratio of local content in their products to increase their value. Top priorities would also be given to diversifying designs and improving quality, he noted.

“The garment industry is striving to evolve from sub-contracting to original design manufacturers (ODM) to increase value,” Truong said.

Vinatex, the country’s leading garment group, made a six-month revenue of over 19.37 trillion dong, a year-on-year increase of 33 percent or equivalent to 55 percent of the year’s target.

Also in Jan-Jun, it gained about $1.23 billion export turnover of goods, surging 32 percent over the same period of last year. It expects to obtain a revenue of 17.5 trillion dong and an export value of $1.2 billion in the second half of this year.

The country’s total apparel export value in the year’s first half amounted to $6.16 billion.- Vietnamplus

Tags: Vinatex