Export garment producers see decline in orders

May, 09/2016 - 23:00

Producers of export quality garments are facing a reduction in orders, according to the Việt Nam Textile and Apparel Association (VITAS)

Workers process garment products for export in Norfolk Joint Stock Company in Đồng Văn 1 Industrial Zone. — VNA/VNS Photo Vũ Sinh
Viet Nam News

HÀ NỘI – Producers of export quality garments are facing a reduction in orders, according to the Việt Nam Textile and Apparel Association (VITAS).

Vũ Đức Giang, VITAS chairman, said they were considering moving export garment orders from Việt Nam to Cambodia, Laos, and Myanmar, because customers of those countries would join the preferential export tax when exporting to the United States (US) and Europe.

Meanwhile, the Trans-Pacific Partnership Agreement (TPP) and Việt Nam-European Free Trade Agreement have not yet come into effect. Therefore, partners of Việt Nam’s export garment producers could not join any preferential tax regime from those agreements.

According to the General Department of Customs, Việt Nam gained a year-on-year growth in export values of garments at 7 per cent to US$7 billion in the first four months of this year, lower than the expected rate of 10 per cent. Import of materials for export garment production dropped in four months.

Hoàng Trọng Khang, deputy head of the import and export division at the Việt An Joint Stock Company specialising in garment exports to the US, European Union (EU) and South Korea, said the company saw reduction in exports to some major markets, including South Korea.

In fact, export orders for production in the second and third quarters have reduced by 5 per cent to 7 per cent against the same period last year, according to the association. The local enterprises were worried about the ability to move export orders of traditional customers to other regional countries in the second and third quarter. That situation would affect exports of enterprises as well as the garment industry.

To take more export orders and set up professional production and business activities, the Việt Nam Textile and Garment Group (Vinatex) has developed Vinatex International Joint Stock Company (VTJ) and the Supply Chain Development Center (SCDC).

The two businesses would combine and support member companies of Vinatex to exploit and expand the export market, seek customers and develop a supply chain from material to finished products, Trần Quang Nghị, Vinatex chairman, said.

So far, the SCDC has had eight regular customers for garment products and been developing 20 customers in the US, the Europe, South Korea and Japan.

The centre has had 10 customers for cotton and fibre and has been developing 30 customers of the products in Chile, China, Thailand, and Malaysia, in addition to South Korea.

VTJ has had 10 customers and it has concentrated on the US and Japan markets with large export volumes.

Việt Nam expected to gain total export value of $30 billion for this whole year, which is $3 billion more than in 2015. - VNS

Fiber factory to be built in HCM City

The Việt Nam National Textile and Garment Group (Vinatex) plans to build a garment and fiber factory in HCM City’s rural district of Cần Giờ in an effort to reduce the poverty rate.

The plan to build a factory employing 2,000 workers was approved by Đinh La Thăng, secretary of HCM City’s Party Committee, who met with Vinatex’s leader on Friday (May 6).

Up to 44 per cent of households in Cần Giờ live under the poverty line, Thăng said.

The garment factory would be a short-term solution to alleviate the poverty rate in the district, he said.

The factory is expected to offer 2,000 jobs, with priority given to local residents, according to Lê Tiến Trường, general director of Vinatex.  

Thăng asked Vinatex and leaders of Cần Giờ to promptly complete necessary procedures for the project. —  VNS