Fabric production is a challenge for Vietnam's textile and garment industry when it comes to free trade agreements (FTAs) requirements on product origin.

With demand decreasing sharply, the textile and garment industry is expected to continue facing difficulties in Q2.

Vietnam's garment and textile exports in the first four months fell 10 percent year-on-year to 10.63 billion USD and could fall much further as buyers cancelled orders due to COVID-19, according to the Vietnam Textile and Apparel Association (Vitas).

Prime Minister Nguyen Xuan Phuc emphasized that it was necessary to settle six problems in the textile and garment industry to avoid losing important export markets.

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.

Vietnam has been unable to gain export growth to all CPTPP member countries, according to the Ministry of Industry and Trade.

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.

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

The target of exporting $40 billion worth of textiles and garments this year may be unattainable.

Vietnam Textile and Apparel Association (Vitas) said the total export value of textiles, fiber, and cloth reached US$25.7 billion in the first 8 months of the year, up 8.6 per cent year on year, including 60.6 per cent from FDI enterprises.

Vietnam’s textile and garment companies are trying to find more orders to ensure continuous production from now to the end of the year.

The Vietnam Textile and Apparel Association (VITAS) in co-operation with IDH – a Dutch sustainable trade initiative – kick-started the Life and Building Safety Initiative (LABS).

A number of industries that make products for export, including textiles and garments, are expected to change for the better if they can take full advantage of the value chain from EVFTA.

Vietnam and Bangladesh are forecast to reap benefits from becoming alternative sourcing destinations as the fashion sector is reckoned the most exposed amid an escalating US - China trade war, according to Fitch Solutions analysts.

Vietnam’s textile and garment may not be able to take full advantage of the preferential tariffs of two important FTAs, CPTPP and EVFTA, because of problems in input materials.

Vietnam's yarn industry faces many challenges in production and export, especially to China, one of the largest export markets for local yarn products, according to experts.

The textile and garment industry, aiming to take advantage of free trade agreements (FTAs) with a focus on green manufacturing, is upbeat about earning US$60 billion from exports by 2025.

The foreign direct investment (FDI) flow into the textile & garment and footwear industries increased sharply after Vietnam signed the EU-Vietnam FTA and CPTPP, and is expected to continue to rise in the context of the US-China trade war.

Foreign investors have poured more money into yarn, garment and accessories projects, while Vietnam needs more projects on textile, dyeing and trimming projects to form closed textile & garment value chains.