Garment, textile sector seeks out new suppliers

Update: June, 03/2014 - 09:33
The sector's export turnover in May was US$1.45 billion, reducing 8 per cent against April.— VNA/VNS Photo
HA NOI (VNS)  — Garment and textile companies have been actively seeking material suppliers to reduce dependence on imports from China, due to complicated changes in the market.

Cao Anh Dung, Director of the Ministry of Industry and Trade's Light Industry Department, told reporters at a press briefing in Ha Noi yesterday to review the country's economy in the first five months of the year, that exports of businesses in the light industry including garment and shoes had shown a positive trend.

In addition, imports of materials for the garment and textile sector have been normal at the border gates.

Statistics from the ministry showed that cloth production from natural fibre in May was estimated at 27.2 million sq.m, reducing 5.4 per cent over the previous month. The total production in the five-month period was 129 million sq.m, posting a 17 per cent year-on-year increase.

The sector's export turnover in May was US$1.45 billion, reducing 8 per cent against April. However, total turnover in the first five months of the year was $7.44 billion, up 17 per cent over the same period last year.

Deputy General Director of the Viet Nam Garment and Textile Group (Vinatex) Hoang Ve Dung said the raw material market for the garment and textile sector has not been changed much though several companies in the group imported materials from China.

The Viet Nam Garment and Textile Association asked enterprises to actively seek materials from Thailand, South Korea, Indonesia, Malaysia and India.

Rice exports increase

Phan Van Chinh, Director of the ministry's Import-Export Department, said rice exporters have signed export contracts worth 4.3 million tonnes, an increase of 17 per cent as compared to the same period last year despite the difficulties in the market. By the end of May, rice exports reached 2.7 million tonnes while another 1.6 million tonnes are awaiting shipment.

Asked whether the Ministry of Industry and Trade would remove floor prices on rice exports, Chinh said the issue was being discussed with ministries and relevant agencies.

The Government has told the ministries of Industry and Trade, and Agriculture and Rural Development, to consider the impact of pilot removal of the floor prices on rice exports and propose appropriate management measures to facilitate export activity.

The Viet Nam Food Association (VFA) proposed to allow local firms to export rice to their clients at prices agreed upon by the two sides, instead of the floor prices set by the association.

The FOB floor prices set by the VFA are $410 per tonne for 5 per cent broken rice, $375 per tonne for 25 per cent broken rice and $365 per tonne for 35 per cent broken rice.

No power tariff rise

Speaking further, Deputy Minister Do Thang Hai affirmed that electricity tariff would not be increased in the near future. Instead, the sector would ensure power supply to production and consumption in the summer months.

In a recent decision, Prime Minister Nguyen Tan Dung had ruled that electricity retail prices will apply to six price levels instead of the current seven levels.

The decision, which will take effect as of June 1, stipulates that power tariffs for households consuming 0 to 50kWh will be 92 per cent of the average price, 95 per cent for households consuming 51 to 100kWh, and 110 per cent for those in 101 to 200kWh bracket. It would be 138 per cent for those consuming 201 to 300kWh, 154 per cent for the 301 to 400kWh bracket and 159 per cent for households consuming more than 401kWh of power.

Dinh Van Phuc, Deputy Head of the Electricity Regulatory Authority of Viet Nam (ERAV) said the new calculations did not mean an increase in power tariffs. The average retail price was VND1,508.85 per kWh.

The ministry's figures showed that power output in the first five months of the year was 52.42 billion kWh, increasing 11.1 per cent over the corresponding period last year. — VNS