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Efforts on to support Vietnam garment sector
17
Oct '12
Grappling to achieve this year’s export target, Vietnam textile and garment industry would introduce several measures to support the sector, the Vietnam Textile and Apparel Association (VITAS) has said.
 
Posting a year-on-year rise of seven percent, Vietnam’s garment and textile sector exported goods worth US$ 10 billion during the first three quarters of the current year, and firm steps need to be taken for achieving the set target of US$ 17-18 billion, it added.
 
The apparel and textile sector’s production and trade have been severely impacted by factors like continuing disagreement between domestic textile producers and US cotton merchants, which is likely to impact their cotton purchases, and the Ministry of Finance’s proposal of ending the existing 275-day grace period that textile importers presently enjoy for tax payment. 
 
The Finance Ministry proposes to amend law to impose more stringent tax payment rules on firms providing outsourcing facilities to their overseas partners, like importing raw inputs and preparing products for exports, and import goods for re-export.
 
The amended law would require companies to pay taxes before the time of customs clearance.
 
In the absence of grace period, the cost of production is seen rising by 8-16 percent and hence there is a need for introduction of steps aimed at easing the situation.
 
The association said it has urged the Finance Ministry to waive the proposal, and has also asked its members to boost overseas sales promotion to strengthen their foothold in existing markets and to gain entry in new markets.
 
The sector would increase investment for upgrading fabric units so as to ensure adequate availability of high-quality fabric for exports.
 
Vietnam National Textile Garment Group (Vinatex) would support its member firms in exploring ways for penetration in emerging markets like Canada and South Korea, and for enhancing sales of textiles to Turkey, China, Africa and the Middle East.
 
Meanwhile, a polyester yarn production programme would also be launched on large-scale to enable the domestic industry satisfy 70-80 percent of local demand by 2015. Success of programme would facilitate value addition to textile and garment items.
 
Domestic textile firms would get latest updates regarding market fluctuations, policy changes and quality norms in foreign markets, which would allow producers to make necessary alterations in their production plans.
 
Aiming to aid the industry, the Ministry of Trade and Industry is also introducing a number of sales promotion programmes, particularly in emerging markets like Malaysia, Hong Kong and Thailand, VITAS noted.
 

Fibre2fashion News Desk - India

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