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Vietnam’s market expansion to Northern Europe, Australia can help avoid trade restrictions

 

Vietnams market expansion to Northern Europe Australia can help avoid tradeAiming to achieve $39 billion in exports this year, the Vietnamese garment and textile industry has moved away from high-end apparels to mid-range and convenient products, says Vu Duc Giang, Chairman, Vietnam Textile and Apparel Association. Enterprises in the country are increasingly moving to making protective clothing and knitwear, adds Le Tien Truong, Chairman and Board of Directors, Vietnam National Textile and Garment Group in a Saigaon Online report.

Exporters focus on sustainability

Exporters are also focusing on sustainable apparels products that help minimize waste generation, enhance recyclability, and reduce the use of fossil energy. They are opting for chemical-free, environment-friendly fabrics that do not generate wastewater. The three development strategies being adopted include: review of ll changes in consumer demands in key markets; adopting green production technologies; developing products along with their brands. These strategies help exporters build a more sustainable market especially with the advantages Vietnam’s FTAs offer in terms of tax rates and competitiveness for garment and textile products.

It has become important for Vietnamese exporters to quickly adapt to these market changes as the pandemic had broken many raw material supply chainsVietnams market expansion to Northern Europe Australia can help avoid trade restrictions and resulted in bankruptcies to major global apparel brands. Exporters also need to reduce their production times as they may face logistic difficulties.

Avoid trade restrictions

Vietnam’s exporters also need to avoid being investigated for improper trade practices and imposed restrictions. As per the American Apparel and Footwear Association, the US government is currently investigating the possibility of imposing new punitive tariffs on imports, including garment and textile products, from Vietnam. In November last year, the US Department of Commerce (DOC) also initiated an anti-dumping investigation on polyester-textured yarn (PTY) exported from Vietnam.

As per Do Thang Hai, Deputy Minister of Industry and Trade, such trade restrictions on Vietnam’s exports are likely to affect domestic trade in international markets. Hence, domestic enterprises need to collaborate to prevent foreign enterprises from changing the origin of their products. The government needs to attract investments in domestic industries through preferential trade policies that would help it to reduce competitive pressure in the export markets.

Duc Giang also recommends enterprises to negotiate and sign strategic cooperation agreement with the US to increase export advantages in the garment and textile industry. Trade counselors also advise Vietnamese apparel and textile enterprises to expand their export market share to Northern Europe and Australia.

The import tariffs in these markets are extremely preferential as they have signed FTAs with Vietnam. Vietnam’s imports form a modest proportion of their total imports from around the world. Hence, Vietnam has an opportunity to increase its share in these markets avoid trade restrictions from being imposed on the country.

 
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