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Trend of new investments in clothing sector to continue
23
Sep '10
Vietnam Garment and Textile Group (Vinatex) experts said that, over 12 garment and textile businesses, mainly to the north of Vietnam have been allocating funds towards expansion of their production capacity since 2009, and the same trend is likely to continue in future also.

Nguyen Van Thoi, General Director of the Thai Nguyen Investment and Trade Company (TNG), while assessing this upward trend said that, leaving behind China, Vietnam is now surfacing as the new focus country for garment and textile buyers across the globe. Meanwhile, firms within the country are shifting their business from south to north due to cheap availability of labour there.

Besides this, the buyers are now into direct touch with the exporters, which eliminates intermediaries, and the same is seen to boost the growth prospects of garment firms in the country, including TNG.

It is not long back that TNG allocated 210 billion VND (11 million USD) for construction of its fourth plant, which is expected to go operational in the last quarter of 2010-11 fiscal. Addition of this facility would see the company, find a place amongst country's major garment suppliers.

Previously, in spite of volatility in the markets, Nha Be Garment Joint Stock Corporation having 22 garment producing units and eight trading firms, allocated trillions of VND for funding some 10 projects. Two of these projects with a total funding of around 200 billion VND (over 10 million USD) are expected to go functional in the end part of this month.

Duong Thi Ngoc Dung, President of the Board of Directors of Nha Be said that, this fresh investment is likely to boost the company's export turnover by 20 to 25 percent in current year.

Experts say that, presently when contracting out, still seems to be advantageous for the country, it is essential that more funds are diverted towards expansion of production facilities. But then, the companies eyeing sustainable growth should invest in auxiliary industries such as fabric materials and processing and dyeing facilities. This would facilitate them to make a shift from outsourcing to developing and selling self-designed products.

Fibre2fashion News Desk - India

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