Apparel sector depends heavily on material imports
Apparel sector depends heavily on material imports
Vietnam saw its apparel sector generate a whopping US$36.2 billion in export revenue in 2018, but input material imports are on the rise.
Speaking at a recent press briefing to introduce the Vietnam International Textile and Garment Industry Exhibition 2019 (Saigon Tex 2019), Nguyen Thi Tuyet Mai, deputy general secretary of the Vietnam Textile and Apparel Association, noted that to earn US$36.2 billion in revenue from apparel exports in 2018, Vietnam had imported US$21 billion worth of materials from China, South Korea and India.
The country’s apparel sector targeted earning revenue of US$40 billion from textile and garment exports this year. However, in the context of the dire need for input materials, Vietnam will still buy large volumes of materials from foreign markets to meet its production needs.
Mai stated that foreign investors have built various plants in Vietnam to meet origin requirements to take advantage of preferential tax policies in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.
However, the rise in investments by foreign direct investment firms has yet to reduce reliance on input material imports, resulting in a modest profit for the industry despite the high export revenue.
However, the greatest difficulty faced by the apparel industry is that locals and State authorities have blocked the opening of dyeing facilities due to environment pollution problems, Mai remarked.
Pham Xuan Hong, chairman of HCMC Textile and Apparel Association, pointed out that apart from the obstacle related to input materials, apparel firms are grappling with other bottlenecks, including a lack of laborers and tough competition with products made in Bangladesh and Pakistan. Hence, these firms have to switch to investments in machines and must improve their products’ quality and overall productivity.
More than 1,000 firms from 24 countries and territories are expected to take part in Saigon Tex 2019 from April 10 to 13 at the Saigon Exhibition and Convention Center in District 7.
The expo is expected to feature a wide range of modern equipment, machines and technologies for the apparel and dyeing sectors, aside from various materials.
