Việt Nam's textile and garment exports in April decreased by 20 per cent compared to March. photo dauthau.vn

HÀ NỘI – The domestic textile and garment industry faced an export value reduction in the first four months of this year due to difficulties in production due to the COVID-19 pandemic.

Statistics showed Việt Nam's textile and garment exports in April decreased by 20 per cent compared to March, Trương Văn Cẩm, vice chairman of the Việt Nam Textile and Apparel Association (Vitas), said at an online seminar held by the association on Monday.

The total textile and garment export value in the first four months of this year dropped by 6.6 per cent to US$10.64 billion year-on-year. Meanwhile, the total import value was $6.39 billion, down 8.76 per cent compared to the same period last year.

"Việt Nam's textile and apparel industry has never faced negative growth in both imports and exports like that," Cẩm said.

Export value reduced by about 6 per cent to $8.27 billion for garment products, 0.3 per cent to $664 million for fabric products, 11.5 per cent to $1.19 billion yarn products and 6 per cent to $354 billion for textile materials.

Meanwhile, import value also declined by about 8 per cent to $893 million for cotton, 2.5 per cent to $758 million for yarn products, 11 per cent to $3.63 billion for fabric products and 5.8 per cent to $1.11 billion for textile materials.

The reduction reflected the industry's lack of export orders, said Cẩm, adding that those figures are forecast to drop further in May and June because most export orders for those months have been cancelled.

Many enterprises in the industry have bad debts, he said. Many export garment enterprises are operating at reduced capacity because they do not have new orders.

The association reported the cancellation of contracts and lack of new contracts was due to the reduction of demand for textile and garment in the US and EU during the pandemic. Meanwhile, China also has less demand for importing yarn from Việt Nam due to the suspension of production during the outbreak.

With a lack of new export orders leading to fewer jobs and pressure in wage payment, the association has proposed many solutions to support enterprises. However, those solutions could not help them maintain production until the end of this year.

Trần Thanh Hải, Deputy Director of Ministry of Industry and Trade’s Import-Export Department, said the COVID-19 pandemic had affected exports of many products, including textiles and garments. Many enterprises had shifted to producing cloth face masks to meet domestic demand and exports.

However, the export value at $63 million from face masks from January 1 to April 19 was too small compared to the total export value of textile and garment at $10 billion in the first four months of the year, according to Vitas.

The textile and garment industry is predicted to have a strong reduction in total export value for this year. In the most positive scenario, its export value will reach about $35 billion this year, down 10 per cent year-on-year.

In a realistic scenario, the industry's export value is estimated to reach about $33.5 billion. In a bad case, the export value will only reach $30-31 billion in 2020. - VNS