Vietnam : Garment & textile industry strives to escape inflation

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Garment & textile industry strives to escape inflation

19
Apr '08

Exorbitant prices of consumption goods and other raw materials coupled with weakening US dollar have raised serious concerns for the textile and garment exporters of Vietnam.

To bring about a solution to this perpetuating crisis, members of HCM City Textile, Garment, Weaving and Embroidery Association recently concluded a meeting.

Exporters and producers at the meeting unanimously voiced their opinion about the huge impact of inflation and weakening dollar on the garment and textile industry.

Production activities, in particular, have been found to endure with the hardest of the prevalent situation. Additionally, soaring prices have also impelled the enterprises to hike the salaries of the workers to ensure a decent standard of life for them.

Moreover, a close study has showed that with an export worth US $10 million, the enterprises will suffer a loss of approximately VND10 billion, due to appreciation of Vietnamese currency.

All the members at the meeting voted in favor of acquiring assistance from macro-economic management agencies to overcome the current difficulties. Additionally, it became quite clear that to outlive cut-throat competition, the foremost task of the enterprises will be to ensure their own survival.

As such, entrepreneurs must restructure their production activities with fewer workers and higher efficiency and ask for Government aid to deal with the present circumstances.

Some of the most logical suggestions to the existing grievances that emerged from the meeting included promotion of export-import activities, banks to offer loans at the lowest trading price, abolishment of collection of trade union fees and other kinds of fees to increase workers salaries and banks to buy-back US dollars from export contracts with highest trading band.

It is hoped that the outcomes of the meeting will have a far reaching effect on the industry which is expected to come out of this pitfall as there are indications of a positive US exchange rate and improving market conditions.

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