The Vietnam National Textile and Garment Group (Vinatex) has set an ambitious target of achieving $39 billion in export revenue this year, equal to that of 2019. Last year, the group could achieve exports worth only $35 billion due to the pandemic, US-China trade tensions and Brexit. However, Vietnam was the only country among the world’s top five garment-textile exporters that did not cease production during the pandemic. According to Vietnam Times, the country was able to achieve export revenues worth VND 15.5 trillion last year and a profit of 628.9 billion.
In the first four months of the current financial year, Vietnam’s textile and garment exports increased 13.33 per cent to $11.747 billion compared to the same period last year, reveals Vietnam Textile and Apparel Association (VITAS).
Exports dominate with $8,766 bn revenues
Garment exports dominated during the year with revenues worth $8,766 billion. This was followed by fiber exports worth $1,638 billion, and fabric exports amounting to $740 million. Most exports were to the US, Europe and Japan during the year.
Experts attribute this vigorous growth in exports to the gradual recovery in several of its key markets and opportunities being offered by new free trade agreements. Vietnam’s local textile sector index during the period increased 8.1 per cent year-on–year, while clothing industry index increased 9.1 per cent. The combined turnover of the garment and textile industry during the year increased 15 per cent while that of all kinds of fibers and yarns increased 60 per cent.
Vietnam’s garments and textiles are known to enjoy a competitive advantage in several markets like the EU and the US. According to Le Tien Troung, Chairman, Vinatex, the country’s garments and textiles enjoy a competitive advantage in several major markets, including the EU and the US. The sector is known for its sustainable and clean production techniques.
Introduce export-oriented policies
However, a representative of Hue Textile and Garment Joint Stock Company believes, impacted by the pandemic, Vietnam’s garment sector may face a difficult period in the second quarter of this year. He along with a VITAS representative advise local businesses to keep a close tab on market changes and adjust production strategies accordingly. They also recommend incorporation of green solutions in their textile and garment products and seeking new orders.
Truong advises the government to cut of long-term interest rates as the textile and garment firms may find it difficult to repay loans due to declining businesses. The government also needs to adopt specific policies to support growth in the sector, he adds.
Though textile and garment production in Vietnam has revived, it is yet to achieve previous growth levels. The Ministry of Industry and Trade will continue to promote exports by exploring new FTAs, diversifying export and import markets, making exports more competitive and developing new trademarks.