In 2014, exports of textile industry reached nearly $ 24.5 billion, up 19% compared with 2013, the largest increase in three years. Many experts assert, textiles will continue to thrive in the coming years, but faces many challenges. Vietnam’s garment sector is ranked No. 2 in exports to the US and Japanese markets.
Vietnam Textile and Apparel Association (Vitas) said that the results achieved in the export of textile and apparel industry in 2014 reflects the efforts of the business community in the sector, but also can not help but say to favorable effects from effectively in the negotiation of free trade agreements, especially those agreements are directly related to the main markets such agreements Trans-Pacific Partnership (TPP), the FTA with the EU, South Korea, United Customs league Russia – Belarus – Kazakhstan. Many partners have decided to take orders from countries that do not join the agreement to Vietnam. This is a favorable one and is the premise for Vietnam’s garment continue to thrive in 2015.
2015 is considered a good year for the export of textile and garment industry of Vietnam. Depth analysis of opportunities in the market shows turnover growth prospects even in the traditional markets of the sector is very large. Forecasting, textile industry could double in size in 10 years to produce, while there are advantages from free trade agreements. For example, in the EU, this time Vietnam accounts for only about 1% of the total value of imported textiles. However, the FTA Vietnam – EU was signed, the tax from 12% to 0%, would create major competitive for textiles exports to this market. Similarly, tax incentives brought by TPP also facilitate the enterprises to expand market share in the US market. Vietnam textile and garment exports to the US tax rate of approximately 17-18%, but exports have been growing at 12-13% / year, then the TPP was signed tax rate will decrease down 0%, surely generate more growth. Similarly, in the Russian market, free trade agreement Vietnam and Customs Union (Russia – Belarus – Kazakhstan) will open up significant opportunities for tax policy, customs and create great appeal now Industry.
In fact since the end of 2014, many now Vietnam has signed export orders completed until the end of Q3, even for 2015.
Expected to mid-2015, Vietnam will join the TPP. Seen from outside, Vietnam’s garment sector benefited, in particular exports to the US will be able to reach 22 billion dollars in 2020. But from the inside, Vietnam enterprises have careful look than. Such joining TPP, the garment goes to market in 12 countries in the agreement will be the rate of 0%, was supposed to be very beneficial for businesses specializing in exports. But before the request origin, localization rate of products in the garment industry to achieve 55% or more, but in Vietnam, the current ratio is only 25% less, now Vietnam will not enjoy favorable. The TPP countries also pose many technical barriers, such products are rigorously tested by an independent inspection company.
Vitas also has letter calling on businesses in the industry to actively seek potential markets outside of China to imports of raw materials. Actual market surveys Japan and South Korea’s textile industry now, then in Japan, the company producing raw materials for the garment industry is shrinking rapidly due to not compete with goods from China . Before 2000, in Japan there are about 500 textile companies, now merged, dissolved only about 50 companies, raw materials used in producing only enough water. South Korea currently has to import a raw materials from China. Thus unable to find domestic sources of raw materials, they must accept no incentives.
Not only that, a series of enterprises from countries (mostly from China) came to Vietnam investment opportunities brought by TPP. As Haputex Development Corporation Limited (Hong Kong) joint venture investment was $ 120 million venture Company Ltd. Southern Textile Limited in Pacific, 12 hectares wide, specializing in weaving, to be operational in early 2016. TAL Group (Hong Kong) invested $ 600 million in construction of the plant producing yarn, fabrics and garments in Dai An industrial zone (Hai Duong). In Nam Dinh construction license factory dyed yarns invested $ 68 million for Yulun Textile Group Jiangsu (China). Hung Yen, there Loi Tinh textile company …
Opportunities textile exports of Vietnam also forced domestic firms to compete more harsh in their home market. By choosing Vietnam as a manufacturing center of textile and garment exports are the target of many investors. In 2014, nearly 20 new FDI projects invested in textile field. Currently the total FDI invested in the textile industry over $ 2 billion. FDI sector accounted for 60% of exports.
Thus it can be said, in 2015, export growth prospects of the garment industry in Vietnam is quite bright. To be able to take advantage of opportunities from TPP textile industry need to increase the localization rate, forming a complete supply chain from design – materials – sewing – distributed, and have responsibility for building community Building competitiveness of the entire chain.