Vietnam's textile and clothing industry needs to face problems and take advantage of "golden" chances to grow

DNHN - On August 16, the Investment, Trade, and Tourism Promotion Center of Hanoi held a seminar called "Solutions to Improve the Effectiveness of Corporate Governance in the Textile Industry in the New Context."

The Vietnam Textile and Apparel Association says that textile businesses will slowly get back on their feet after the COVID-19 pandemic. This will happen around the year 2022. In the first half of 2022, exports of textiles and clothing were worth about USD 22.3 billion. This was 17.7% more than in the same half of 2021.

The main things that were sent abroad were clothes, which brought in 16.94 billion USD. Over the same period, it went up by 19.5%. The total amount of textile raw materials and accessories that were brought in through imports was about 13.4 billion USD. This was 9.8% more than the same time in 2021. The trade surplus went up 32% from the same period to USD 8.86 billion.

During the pandemic, businesses quickly adjusted to the new business environment by changing their product lines, expanding into new markets, and changing how they accept payments. This was a big change from the way people used to buy and sell before the pandemic.

Mr Le Tu Luc, the Deputy Director of the Center for Investment Promotion, Trade, and Tourism in Hanoi, said that Vietnam's textile and garment industry has been one of its most important export industries for many years. Businesses are investing in tools and technology to automate production and business processes, manage and keep an eye on the product supply chain, and make sure it is fast, clear, and accurate.

Mr Luc also said that in the future, the Center for Investment, Trade and Tourism Promotion of Hanoi City will continue to work with businesses and try to promote its role as a public non-business unit directly under the management of businesses. The Hanoi People's Committee is in charge of coming up with and putting into action plans and programs to encourage investment, trade, tourism, agriculture, and services to the outside world in the city. It also has to put together recommendations and come up with policies to attract investment, trade, tourism, and agriculture. At the same time, help businesses, organizations, and people from Vietnam and other countries find investment, production, and business opportunities in Hanoi and other cities and provinces in Vietnam and around the world.

Deputy Director of the Foreign Investment Department at the Ministry of Planning and Investment, Nguyen Anh Tuan, spoke at the Seminar. He said that as of May 18, 2022, the total amount of FDI in the textile and garment industry was 31,334.249 million USD, with 2,787 valid projects. One of the most important export industries in Vietnam is the textile industry, which makes up 12–16% of the country's total export turnover.

Mr Nguyen Anh Tuan says that the textile industry doesn't have enough links along the value chain. Vietnam has a large trade deficit in fabrics, but a trade surplus in yarns and clothes. Most of the yarn made is not used for weaving in the country where it is made. Vietnam imports more than 10 billion USD worth of fabrics every year because the ones they make at home can only meet about half of the demand.

New generation FTAs, on the other hand, have rules of origin. To be certified with rules of origin and get tax breaks, yarns and fabrics must be made in Vietnam and used in Vietnam or FTA countries. So, textile businesses have to focus on growing along the whole chain, which creates a domestic value chain.

Vice President and General Secretary of the Vietnam Textile and Apparel Association (VITAS) Truong Van Cam also talked more about the problems in the textile industry: Vietnam's textile and clothing industry faces tough competition from China, Bangladesh, and Turkey, India, and other countries. In the Vietnamese market, it has to fight hard against big foreign brands that are already there.

The markets of the countries that buy textiles and clothes from Vietnam are mostly high-end and picky, with high standards for quality, safety, the environment, recycling, labour, and standards. Trends around the world are also changing. Fast fashion is giving way to fashion that lasts.

The Textile and Garment industry can deal with problems and take advantage of "golden" opportunities for growth, the people who took part in the Seminar came up with ways to get people to invest in the textile and garment industries, especially in textile-dyeing projects, the production of new materials made from natural sources, and environmentally friendly... At the same time, textile enterprises need to improve their management skills and develop their human resources. Enterprises need to keep pushing for the creation of new brands and products, as well as the diversification of raw material supplies and export markets, "greening" the textile industry, etc.

PV (t/h)