Home / Knowledge / News / Apparel/Garments / Testing times ahead for Vietnam garment makers
Testing times ahead for Vietnam garment makers
Oct '12
No relief is expected for the ailing garment and textile enterprises of Vietnam in the coming months, and difficulties faced are mainly due to restricted or no access to capital and dearth of export orders, industry circles said during a seminar organized to deliberate on ways to help the garment firms to overcome the problems faced in securing new orders and capital.
According to Bank for Investment and Development of Vietnam (BIDV) all the companies, with revenues of over US$ 10 million that it considered for a survey, were in need of medium and long-term loans for supporting their production enhancement or investments plans.
BIDV was one of the joint organizers of the seminar along with Vietnam Textile and Apparel Association (VITAS) and Dun & Bradstreet (D&B).
VITAS Deputy Chairwoman and General Secretary, Dang Phuong Dung, said a sharp decline has been observed in demand from the EU over the past few months, which has led to a year-on-year fall in exports.
Meanwhile, owing to lack of access to capital, several domestic textile and garment firms are outsourcing their work, she added.
Ms. Dung said large-scale dependence on imported inputs and outsourcing orders, which generate considerably low returns on investment, show that domestic enterprises are not being able to add value to their goods, which can help boost the sector’s competitiveness.
She further said low labour cost would not help the industry to sustain its competitiveness in future, and hence the industry should look at other ways like raising investment in technology and equipments, to boost its labour productivity and thereby its competitiveness.
However, enterprises in the sector face several difficulties in obtaining bank loans. Moreover, though the interest rates have declined in recent times, they are still quite high as compared to those in other nations, she added.
According to Ms. Dung, if the existing rule allowing garment makers a 275-day grace period is ended as proposed by the Ministry of Finance, it would increase difficulties of domestic garment firms. She said VITAS is trying to get together with other business associations to urge the Government to review the proposal.
On near-term prospects of the country’s garment and textile exports, she said there are good prospects in the US market, however, no signs of revival are yet seen in the EU market, she added. 
The industry should try to resolve the issues relating to raw material and adhere to stringent rules of origin in order to tap the opportunities extended by free trade agreements (FTA), as these FTAs and Vietnam’s World Trade Organization (WTO) membership are expected to open ways for entry in new markets, she added.
Amcham Vietnam Executive Director Herb Cochran suggested that Vietnamese firms should study consumer’s choices so as to churn out products meeting their requirements.

Fibre2fashion News Desk - India

Must ReadView All

Courtesy: Myntra

Apparel/Garments | On 3rd Dec 2016

Myntra to be EBITA positive by FY18: CEO Narayanan

Myntra is on track to achieve sustainable growth and be EBITA...

Courtesy: India ITME Society

Textiles | On 3rd Dec 2016

India ITME 2016 opens with over 1050 exhibitors

The India International Textile Machinery Exhibition (India ITME)...

Courtesy: Bruckner

Textiles | On 3rd Dec 2016

Indian textile companies opt for Brückner stenter lines

Indian textile firms Laxmipati Sarees, makers of polyester sarees and ...

Interviews View All

Siddharth Biyani
Mangalam Industries Pvt Ltd

‘The manufacturing sector is improving day-by-day, becoming better in...

Frank Gossmann
Rotorcraft AG

‘RT3 motto is: Do not check millimetres, check colours.’

Amit Jain
Shingora Textiles Ltd

‘In terms of fabric, the fastest growing category for us is a blend of...

Iago Castro Asensio
RCfil Distribuciones S.L.

Iago Castro Asensio, International Business Manager of RCfil...

Giorgio Mantovani
Corman S.p.A

Giorgio Mantovani, MD of Corman, with a presence in both Milano and New...

Kevin Nelson

Kevin Nelson, Chief Scientific Officer, TissueGen discusses the growing...

Yash P. Kotak
Bombay Hemp Company

One of the directors of Bombay Hemp Company, Yash P. Kotak, speaks to...

Prathyusha Garimella
Prathyusha Garimella

Hyderabad-based designer Prathyusha Garimella is known for blending...

Ritu Kumar
Label Ritu Kumar

‘Classics will return’ "There are a lot of people wearing western clothes ...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


Letter To Editor

(Max. 8000 char.)

Search Companies

December 2016

December 2016

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.


Browse Our Archives


Advanced Search