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Vietnam looks for suppliers other than China

Companies in Vietnam's garment and textile sector are actively seeking new suppliers of materials to reduce their dependence on imports from China.


Finding material suppliers from countries other than China, which is currently the main supplier to Vietnam, is seen necessary for two reasons. First, is to reduce dependency on China, and second is to prepare for the Trans-Pacific Partnership (TPP) agreement, expected to be signed later this year.


The TPP agreement is likely to apply the yarn-forward principle, where fabric and garments made from yarn imported from China, which is not a part of TPP, would not enjoy duty-free benefit for exporting to other TPP-member countries.


For the first five months of 2014, Vietnam’s exports of garments showed a positive trend. Vietnam’s fabric production from natural fiber during January to May 2014 was 129 million sq m, registering an increase of 17 per cent year-on-year. However, production in May dropped by 5.4 per cent over April figures. In May 2014, Vietnam’s exports of garments and textiles showed a decrease of 8 per cent compared to April exports.


The Vietnam Textile and Apparel Association has asked enterprises to explore importing materials from countries like India, Indonesia, Malaysia, South Korea and Thailand.