Vietnam garment companies had tough year in 2019

After two years of hot development, Vietnam’s textile and garment industry could not fulfill the target of exporting $40 billion worth of products in 2019.

Le Tien Truong, general director of Vinatex, the biggest textile and garment group, admitted that 2019 was a tough year for the group. It had pre-tax profit of VND1.394 trillion, lower than 2018.

Vietnam garment companies had tough year in 2019



Asked about the business plan for 2020, Truong said the conditions are unfavorable and the future of the US-China trade war remains unclear, so Vinatex has only set modest targets – VND50.992 trillion in revenue and VND1.553 trillion in pre-tax profit.

When Vietnam signed CPTPP (Comprehensive and Progressive Agreement for Trans-Pacific Partnershipand) and the EU-Vietnam FTA, analysts all said that the agreements will bring big benefits to Vietnam. However, Truong said it is not easy to enjoy the preferences of FTAs because of the strict rules of origin.

To satisfy the requirements on product origin, Vietnam needs to be able to produce fabric domestically. This is a difficult job as Vietnam has to compete with many big producers, including China, which provides 54 percent of total fabric output globally, and India with 20 percent.

To satisfy the requirements on product origin, Vietnam needs to be able to produce fabric domestically. This is a difficult job as Vietnam has to compete with many big producers, including China, which provides 54 percent of total fabric output globally, and India with 20 percent.

 


Also according to Truong, the enterprises with complete supply chains all target niche markets and make products with the guarantee of distributors.

Viet Tien Garment is an example. To be able to become a partner of Uniqlo and Nike, the company has had to make big investments in equipment and technology.

Textile and garment industry remains one of 10 products with the biggest export value, but the industry has to compete with China and India.

According to Nguyen Xuan Duong, chair of Hung Yen Garment, by this time of previous years, the company had orders for the second quarter. Now, orders are coming in dribs and drabs.

“American partners who have been cooperating with us for tens of years don’t sign long-term contracts now, but only sign short-term orders,” he said. “They have to listen to the news about the US-China trade war before placing orders."

The Ministry of Industry and Trade (MOIT) confirmed that the number of orders enterprises have is just 80 percent of the same period last year. Instead of receiving long-term contracts, they now receive orders monthly or quarterly.

Garment companies all complain that they are facing difficulties as they have to struggle to scramble for orders with textile and garment powers such as China, India and Bangladesh.

Kim Chi 

Textile and garment companies need more orders for 2020

Textile and garment companies need more orders for 2020

The number of orders that textile and garment companies have received for 2020 is just equal to 80 percent of that in the same period last year.

VN garment, textile export falls short of target but surplus impressive

VN garment, textile export falls short of target but surplus impressive

Vietnam’s garment and textile exports were estimated at US$39 billion this year, slightly falling short of the US$40 billion target.

 
 

Other News

.
Black Friday 2021 launched in HCM City
Black Friday 2021 launched in HCM City
BUSINESSicon  20/11/2021 

The shopping festival Black Friday was kicked off on November 19 in Ho Chi Minh City.

Decrease in in seafood exports expected as a result of new Chinese policy
Decrease in in seafood exports expected as a result of new Chinese policy
BUSINESSicon  20/11/2021 

Vietnam’s seafood exports to China are likely to decrease sharply as Chinese customs are tightening control over imports.

Consumers more prudent with post-pandemic personal finances
Consumers more prudent with post-pandemic personal finances
BUSINESSicon  20/11/2021 

After giving birth to their second daughter, Thanh Van, a 39-year-old office worker in Hanoi, had to quit her job because she could not afford the cost of hiring a babysitter after a 30 per cent pay-cut due to the COVID-19 pandemic. 

Digital transformation to create new growth engine for Vietnam's agriculture
Digital transformation to create new growth engine for Vietnam's agriculture
BUSINESSicon  19/11/2021 

As digital transformation will help overcome most of the weaknesses faced by the local agriculture sector, it should be considered a breakthrough solution for sustainable growth and development in Vietnam.

Flower farmers do not dare grow large quantities for Tet amid Covid uncertainty
Flower farmers do not dare grow large quantities for Tet amid Covid uncertainty
BUSINESSicon  19/11/2021 

Many flower and bonsai farmers in HCM City and the Cuu Long (Mekong) Delta have reduced production for Tet (Lunar New Year) which falls early next year since they are worried the COVID-19 pandemic will affect demand.

Vietnam may have new USD billionaires
Vietnam may have new USD billionaires
BUSINESSicon  19/11/2021 

If assets are calculated according to the value of the stock market, Vietnam will have more USD billionaires.

Vietnam among top 10 countries with largest installed solar power capacity
Vietnam among top 10 countries with largest installed solar power capacity
BUSINESSicon  19/11/2021 

Visual Capitalist has listed Vietnam among the world’s top 10 for largest installed solar power capacity.

Global energy crisis: another concern for Vietnam's economy
Global energy crisis: another concern for Vietnam's economy
FEATUREicon  19/11/2021 

Disrupted coal mining in Ordis in Inner Mongolia, the most important coal mining hub in the world, is posing huge risks that could stifle global growth.

Too many traceability apps confuse farm-produce buyers
Too many traceability apps confuse farm-produce buyers
FEATUREicon  19/11/2021 

The farm produce traceability system in Vietnam still doesn’t match GS1 standards (the most widely used system of standards in the world), and, as such, the existing traceability apps are just for internal use.

More businesses seek black credit as cash flow plummets
More businesses seek black credit as cash flow plummets
FEATUREicon  19/11/2021 

Seventy-one percent of businesses anticipate revenue decreases in 2021, higher than the 65 percent figure in 2020, according to a survey.

VIETNAM BUSINESS NEWS NOVEMBER 19
VIETNAM BUSINESS NEWS NOVEMBER 19
BUSINESSicon  19/11/2021 

Seafood stocks surge on business recovery

Overspend in the works for reboot of national economy
Overspend in the works for reboot of national economy
BUSINESSicon  19/11/2021 

Vietnam may not be able to increase its budget deficit next year in order to ensure state budget spending, with the economy still sabotaged and business revenues still dented.

Captivating incentives target FDI from Europe
Captivating incentives target FDI from Europe
BUSINESSicon  18/11/2021 

Vietnam will continue considering foreign investment one of its important drivers for socioeconomic development over the next four years, with its ambitious plan to attract more high-quality funding. 

VN to strengthen financial foundation in the next ten years
VN to strengthen financial foundation in the next ten years
BUSINESSicon  19/11/2021 

Vietnam's top priority for 2021-30 is to build a financial foundation for the country's sustainable development, said policymakers and experts during a conference to discuss finance strategy for the 2021-30 period.

Pandemic makes 85 percent of Vietnamese consumers more likely to use digital banking in future
Pandemic makes 85 percent of Vietnamese consumers more likely to use digital banking in future
BUSINESSicon  18/11/2021 

Around 85 percent of Vietnamese banking consumers are more likely to use online and digital banking services compared to 18 months ago, according to a new report from SaaS cloud banking platform Mambu.

Food shopping trends change due to social distancing
Food shopping trends change due to social distancing
BUSINESSicon  18/11/2021 

The way people buy food in HCM City has changed after a period of social distancing amid the COVID-19 pandemic, with more food products bought online, according to online sellers.

The cost of reopening the economy
The cost of reopening the economy
FEATUREicon  18/11/2021 

Nearly two months have passed since Ho Chi Minh City and 18 southern provinces have lifted lockdown measures and set up the "new normal", with the operations of people and enterprises gradually resuming.

More gyms close as membership dwindles
More gyms close as membership dwindles
FEATUREicon  18/11/2021 

More and more gyms have shut down or have been transferred to others, sometimes for free.

Coffee, vegetable industries agree on codes of conduct to encourage sustainability
Coffee, vegetable industries agree on codes of conduct to encourage sustainability
BUSINESSicon  17/11/2021 

As many as 42 enterprises from the coffee and fruit-vegetable industries have signed a pledge to show their commitment to support and implement the codes of conduct (CoCs) 

Pandemic will have long-lasting impact on business operations in Vietnam
Pandemic will have long-lasting impact on business operations in Vietnam
BUSINESSicon  17/11/2021 

Many factories, including about 200 contracted factories that make sportwear for Nike Corporation, resumed production in Vietnam earlier this month. 

 
 
 
Leave your comment on an article

OR QUICK LOGIN