Sustainable growth is number-one goal

(VEN) – Following its great efforts, the Vietnamese textile and garment sector has raised its localization rate to 45-50 percent from 20 percent in the past. However, the sector’s number-one goal in the current period is not raising the localization rate but promoting sustainable development and ensuring effective production and trade – Vietnam National Textile and Garment Group (Vinatex) Deputy General Director Le Tien Truong said at a press conference on production and trade results of the group in the first half of 2013.

In the first half of 2013, textile and garment exports reached US$8.9 billion, up 14.2 percent compared with the same period last year

In the first half of 2013, textile and garment exports reached US$8.9 billion, up 14.2 percent compared with the same period last year

Satisfactory growth

In the first six months of 2013, textiles and garments continued to hold the number-one position among processing industry-related products in terms of export value with this index reaching US$8.9 billion, up 14.2 percent compared with the same period last year.

Vinatex’s revenue in the first half of 2013, excluding the value added tax (VAT), reached VND22.55 trillion, up 11 percent compared with the same period last year; its export value reached over US$1.44 billion, up 13 percent (US$715 million to the US market, the EU-27 US$223 million, Japan US$198 million, the RoK US$108 million and other markets US$201 million.)

In the first half of 2013, textile and garment exports to the US market reached US$3.94 billion, accounting for 44.8 percent of the sector’s total export value, up 12 percent compared with the same period last year; exports to EU-27 countries reached US$1.29 billion, accounting for 14.7 percent of the total, up 18 percent; to Japan US$1.1 billion, 12.5 percent of the total, up 24.5 percent; to the Republic of Korea (RoK) US$660 million, 7.5 percent of the total, up 32 percent, and to other markets US$1.85 billion.

Notably, while textile and garment imports by the US, EU-27 countries, Japan and the RoK in the first six months of 2013 grew respectively by three percent, 8.5 percent, 9.8 percent and 5.78 percent compared with the same period last year, Vietnamese textile and garment exports to these markets increased by 12 percent, 18 percent, 24.5 percent and 32 percent respectively. Clearly, Vietnamese textile and garment exports to these markets grew at a higher rate compared with imports by them. This reflected the strong competitiveness of Vietnamese textiles and garments. The domestic textile and garment sector imported US$5.6 billion worth of materials, of which US$5.1 billion worth of materials were used to make export products, with the localization rate reaching 45 percent. Vinatex achieved a more impressive localization rate, 60 percent (the group spent US$541 million on material imports to make US$1.44 billion worth of export products). These results reflected the group’s good export quality.

The number-one goal

Vinatex Deputy General Director Le Tien Truong said ten years ago the localization rate of the domestic textile and garment sector was 20 percent, and now it has reached 45-50 percent. However, he added, the sector’s top priority is not raising the localization rate but promoting sustainable growth and ensuring effective production and trade.

He explained that the global textile and garment market currently operated according to value chains with most designs provided by reputable fashion brands in the world. Design is a difficult field for Vietnamese textile and garment producers to penetrate. However, they are capable to do design works related to textile and tailoring stages, meaning that they can act as original design manufacturers (ODMs).

ODM solutions will promote the development of domestic garment, textile, dyeing and material production companies, thus helping increase the localization rate and creating a complete supply chain. Le Tien Truong believes this will lay the foundation for sustainable development of the Vietnamese textile and garment sector.

Vinatex has built some design centers as part of its supply chain. The group is focusing on fabric design to increase its involvement in global textile and garment supply chains. Hopefully, with their flexibility and great efforts, Vinatex and the Vietnamese textile and garment sector in general will continue to maintain its firm position in the world market./.

By Viet Nga

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