The Vietnam National Textile and Garment Group (VINATEX) stated that its garment and textile industry’s VND 11 trillion are at stake if export orders continue to be halted, delayed and cancelled.
The report read that from mid-March, the garment and textile industry’s export orders were continuously cancelled, suspended or temporarily halted, which might eventually lead to shortage of jobs in April and May this year.
As reported by VINATEX, the unemployment rate will be from 30 per cent to 50 per cent in April and May this year if the conditions remain the same.
The larger the brand, higher is the reduction ratio, to which there is no sign of recovery which leads to high pressure on garment and textile enterprises in terms of both finance and labour.
Further, if there is no policy adjustment chances are that enterprises may lose their financial liquidity by the end of April.
If 30 per cent of workers are unemployed, the textile industry will end up losing VND 5 trillion or above. If the situation prevails, industry might end up draining VND 3 trillion every month.
On the sourcing forefront, the industry imports raw materials worth US $ 1.5 every month.
Note the fact that if 20 per cent of orders are cancelled, raw materials worth US $ 300 million will be left unused, which will pose another difficulty for the inventories.
As per the estimated data, the total inventory in April and May will lose 50 per cent of the value which equals to around US $ 300 million.
To the dismay, VINATEX alone will lose about US $ 24 million!