Interviews
Textile & garment enterprises struggle to combat recession
14 Jan '09
2 min read
In the recently held annual conference of Association of Garment Textile Embroidery- Knitting (Agtek) on the trends in 2009, most participants discussed their difficulties and urged support from the Government.
Mr Pham Xuan Hong, Deputy Chairman of Agtek said, after the lunar holidays, there would be a decline in the number of orders, especially from US market. Even big enterprises, will witness their orders decrease by 30-50 percent.
Mr Nguyen An, General Director of Garmex Saigon JSC stated, bulky orders have already declined. The profits from FOB contracts declined by 30 to 60 percent due to the increase in price of material and 10-20 percent in term of processing price. He added that, in this context, the Company must either reduce working hours or downsize its capacity by 20-30 percent.
According to Mr Hong's estimates, a mere 20 percent decrease in export orders would be responsible for nearly 400,000 worker's retrenchment.
In the conference, Mr Nguyen Chi Phuong, General Director of Hoa Binh Garment Company was also present who proposed the government must not collect personal income tax, lessen tax and return VAT quicker and reduce union fee from 2 percent to 1 percent or transfer that fee to grass root union to take care of the living standard of workers.
Mr Nguyen Duc Hoan, Chairman of Agtek, recommended enterprises should reduce cost and manufacturing scale, expand markets and enhance cooperation model between enterprises to share experiences and customers to together overcome difficulties ahead in 2009.
Mr Pham Xuan Hong, Deputy Chairman of Agtek said, after the lunar holidays, there would be a decline in the number of orders, especially from US market. Even big enterprises, will witness their orders decrease by 30-50 percent.
Mr Nguyen An, General Director of Garmex Saigon JSC stated, bulky orders have already declined. The profits from FOB contracts declined by 30 to 60 percent due to the increase in price of material and 10-20 percent in term of processing price. He added that, in this context, the Company must either reduce working hours or downsize its capacity by 20-30 percent.
According to Mr Hong's estimates, a mere 20 percent decrease in export orders would be responsible for nearly 400,000 worker's retrenchment.
In the conference, Mr Nguyen Chi Phuong, General Director of Hoa Binh Garment Company was also present who proposed the government must not collect personal income tax, lessen tax and return VAT quicker and reduce union fee from 2 percent to 1 percent or transfer that fee to grass root union to take care of the living standard of workers.
Mr Nguyen Duc Hoan, Chairman of Agtek, recommended enterprises should reduce cost and manufacturing scale, expand markets and enhance cooperation model between enterprises to share experiences and customers to together overcome difficulties ahead in 2009.
Fibre2fashion News Desk - Vietnam
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