Fueled by a rebound in global demand and a surge of interest from new international players, Vietnam's textile industry is emerging as a reliable and competitive source for apparel brands worldwide.
Though export turnover of Vietnamese textiles and garments increased 16.4 per cent in the first eight months of this year, the Viet Dragon Securities Company has forecast that reduced demand and a prolonged inventory cycle will overshadow the prospects for new orders in 2023 or even have an effect from the fourth quarter of this year.
Vietnam’s textile and garment export turnover reached $31.3 billion in the first eight months of 2022, up 16.4 per cent year-on-year. However, according to SSI Research, the picture in the fourth quarter is not too bright, because the number of orders will be 25-50 per cent lower than in the second quarter, equivalent to a 15-20 per cent fall in revenue year-on-year. At the same time, the sales outlook is also bleak, as the USD/VND exchange rate is forecast to continue to decline in the second half of the year.
On August 11, at a national conference between the Prime Minister and businesses, the Vietnam Textile and Apparel Association (VITAS) proposed that the government remove difficulties facing textile and garment enterprises by reducing or exempting certain taxes and fees, implementing the business recovery support package, and quickly approving the “Strategy to develop the textile and footwear industry to 2030 and vision to 2035”.
Vietnam’s textiles and garment sector is a traditional outsourcing industry using a lot of labor and natural resources, making its transition to green production a major challenge. The Vietnam Textile and Apparel Association has set a target of reducing energy consumption by 15 per cent and water consumption by 20 per cent by 2023 and completing the “greening” of the sector by 2030.
