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Problem for Vietnam's textile firms due to coronavirus

Feb '20
Pic: Shutterstock
Pic: Shutterstock
Textile and footwear makers in Vietnam are struggling to import material from China where factories have closed due to the coronavirus outbreak. Firms have been advised by the Vietnam Textile and Apparel Association (VITAS) to tap other markets to meet targets. China in 2019 accounted for 60 per cent of Vietnam’s garment imports and 55 per cent of fibre imports.

The coronavirus outbreak could negatively impact 10 major industries in Vietnam, including textiles, as Chinese factories shut down, stock brokerage firm SSI Securities Corporation (SSI) observed.

Some Vietnamese factories have either run out of raw material stock, some companies’ stock will last a few weeks more, and some have enough raw material for a few months, according to a report in a Vietnamese newspaper.

There is little scope to order more stock from China under the current circumstances.

In China’s central Hubei Province, where the majority of coronavirus-related deaths have occurred, factories will not resume production until February 14 and could run on a limited scale after that.

Nguyen Quoc Anh, chairman of Ho Chi Minh City Rubber Plastic Manufacturer Association (HRPMA), said production of rubber and plastic in Vietnam is largely dependent on China with 70 per cent of materials imported from that country.

In January, Vietnam’s imports of fabric from China fell 18.1 per cent to $950 million, according to the Vietnam’s General Statistics Office (GSO). Exports of textiles, a key sector, in all markets fell by 21 per cent year on year to $2.6 billion in January, while that of footwear fell by 9.7 per cent to $1.6 billion, it added.

Fibre2Fashion News Desk (DS)

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