Vietnam's garment and textile sector is actively implementing certain strategies to boost production and business operations amidst formidable challenges including dwindling demand, mounting inventory, and geopolitical unrest across various regions.
Enterprises within the sector have reported an influx of export orders, albeit with no corresponding improvement in prices. The value of several contracts has decreased by 30-50 per cent. Additionally, speculation and logistical hurdles are expected to boost cotton prices across the sector. Vietnamese firms are also grappling with fierce competition in the Chinese market, where domestic production is bolstered by tax incentives and support policies.
Cao Huu Hieu, General Director, Vietnam National Textile and Garment Group (Vinatex), says, it is important to seize these opportunities, make informed forecasts, and stay abreast of the evolving situation to take timely action. He advocates for a thorough restructuring of organisations, adoption of advanced management techniques, and prioritisation of projects aimed at enhancing productivity.
Echoeing this sentiment, Le Tien Truong, Chairman, Vinatex, highlights, these obstacles present ample opportunities for firms with robust business strategies, diversified product offerings, active engagement in the supply chain, and a strategic approach towards the digital and green economies. The association pledges to closely monitor market trends and member operations, devising flexible and innovative measures to develop products and explore new markets to ensure sustained business efficiency.
Nguyen Xuan Duong, Chairman, Hung Yen Garment Corporation Joint Stock Company, underscores the challenges faced by firms due to high input costs and workforce transitions to other markets such as South Korea and Japan. Moreover, the sector contends with a global demand downturn of 5-10 per cent, compounded by the risk of major fashion brands facing bankruptcy, resulting in substantial losses for Vietnamese firms.
Duong urges relevant ministries and sectors to enact policies facilitating access to capital for enterprises to strengthen investment and bolster production. He also emphasises the need for assistance programs to improve workers' livelihoods.
Despite these challenges during January to March, Vietnam’s garment and textile exports expanded by 10 per cent Y-o-Y to reach approximately $10 billion. This growth serves as a beacon of hope for enterprises striving to achieve the set target of $44 billion for the entire year.
