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Foreign investors likely to focus on garment industry next year
06
Dec '10
Vietnam Textile and Apparel Association (Vitas) recently stated that more foreign direct investments (FDI) are expected to flow in the country's textile and garment industry in 2011. The investors would be concentrating more on the garment manufacturing units, rather than on the material manufacturing projects.

Le Van Dao, Vice Chairman of Vitas said that, Taiwan, South Korea and Hong Kong would continue to be the leading investors in the country's garment and textile sector.

He revealed that a number of investors from Taiwan are intending to boost their investments in Vietnam. For instance, Eclat Textile Co having a facility in the Nhon Trach Industrial Zone in Southern Dong Nai Province intends to acquire a US $2.5 million worth factory with a manufacturing capacity of around 3-3.5 million pieces of garments and knitwear per year.

The company also has plans to invest around four million dollars to establish a new garment unit capable of producing 2.5 million pieces a year.

Makalot Garment Co., another firm from Taiwan, which presently has a factory in Northern Hai Duong Province, is also intending to invest over six million dollars in Vietnam to boost its production while reducing the input cost, which is on a rise in China.

Further, a North Korean company has also shown interest in investing in fibre production, raising silkworms and in mulberry cultivation. The firm has stated that while the Vietnamese associates would provide man power and other facilities, it would fund technology and equipments.

Vitas stated that, while on one hand the increasing flow of FDI towards the clothing industry was a positive indicator, but then it even indicated that the country was not receiving any assistance for growing its dyeing and weaving units.

Presently, Vietnam needs to import around 80 percent of the materials required by the garment sector each year, mainly because the local firms are able to source only 30 to 50 percent of the country's total requirement of fibre, cotton and other materials used for producing jeans, shirts and other basic garments.

Also, the prices of imported materials have increased by almost 30 to 40 percent, this year. This, too, has added to the sufferings of the producers.

Fibre2fashion News Desk - India

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