Home / Knowledge / News / Textiles / Vietnamese textile firms will face new challenges: Experts
Vietnamese textile firms will face new challenges: Experts
02
Oct '15
Textile and garment firms in Vietnam will face new challenges once the country joins free trade agreements (FTAs), especially the Vietnam-EU  FTA and the Trans-Pacific Partnership (TPP), experts said at a seminar this week in Hanoi.

The use of outdated technology, shortage of capital, and weak management capacities would create considerable competitive pressure from large global companies, once the FTAs are in place, said Tran Quang Nghi, chairman of the National Garment and Textile Group (Vinatex) while speaking at a conference on 'Garment and Textile – Opportunities and Challenges'.

Elaborating on the use of outdated technology, Truong Thi Thanh Ha, general director of Dong Xuan Knitting Company, said domestic textile and garment companies have not invested in modern technology in recent times and several of them use machines that were purchased about two decades ago.

In view of more challenges than opportunities arising from the trade pacts, the Vietnamese government should support domestic businesses by easing tax burden and land rentals, he said.

Talking about shortcomings, Phan Chi Dung, head of the Light Industry Department under the Ministry of Industry and Trade, said many domestic companies depend to a great extent on imported materials, which along with low productivity, would make it difficult for them to take advantage of FTAs.

He said that despite the high growth rates seen in recent years, the added value in garment exports is still limited. Further, there were only a few enterprises that have integrated manufacturing from yarn to apparel. In addition, local companies have not yet developed their own markets and products.

Tran Bac Ha, chairman of the Bank for Investment and Development of Vietnam (BIDV), said the once the FTAs are in place Vietnam would have access to a wider market, and investors would prefer to gradually shift their manufacturing base to the country. This would require that businesses to restructure to enhance their competitiveness.

Bac Ha said BIDV has committed to provide loans of $2 billion to support domestic garment and textile firms over the next five-year period.

There are around 5,000 businesses, mostly small- and medium-sized enterprises in the Vietnamese textile and garment industry. The 12 countries that are part of the ongoing TPP negotiations together account for nearly 70 per cent of the total value of garment exports made by Vietnam.

The Government of Vietnam has targeted to increase the country's textile and clothing exports to $35 billion by 2020 and further to $60 billion by 2030.  (RKS)

Fibre2Fashion News Desk – India


Must ReadView All

Textiles | On 26th Jun 2017

US initiates probe into PSF imported from 5 nations

The department of commerce of the US has initiated investigations for ...

Textiles | On 26th Jun 2017

USTR announces AGOA review for Rwanda, Tanzania & Uganda

The office of the US trade representative (USTR) has announced the...

Textiles | On 26th Jun 2017

Braskem invests in polypropylene production facility in US

The Board of Directors of Braskem, one of the largest producer of...

Interviews View All

Md Hanifur Rahman
Aman Group

The level of understanding the job role and organisational requirements...

Anvita Mehra
Confidential Couture

‘It is going to take some time for Indian buyers to get accustomed to...

Ghanshyam Ghoghari
Kimora Fashion

Bridalwear is not about reds and whites anymore

Steve Cole
Xerium Technologies

Steve Cole of Xerium Technologies discusses the industry. Xerium is the...

Kai Poehler
Voith Paper GmbH & Co. KG

The glass mat industry is growing by five to eight per cent annually. Kai...

Paolo Ocleppo
Sandvik Hyperion

Paolo Ocleppo, Rotary Cutting Segment manager, Sandvik Hyperion discusses...

Jay Ramrakhiani
Occasions Elegance Wear

It is believed that by early 19th century, Varanasi weavers had moved away ...

Wendell Rodricks
Wendell Rodricks

"We should not compare India and the West. There are things we do that...

Madhu Jain
Madhu Jain

She grew up in the walled city of Old Delhi, completed her studies, and...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

news category


Related Categories:
July 2017

July 2017

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

SUBSCRIBE


Browse Our Archives

GO


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search