It’s been a tough 2020 for the apparel and textile world across the globe and Vietnam too is now feeling the heat.
The country may see its apparel and textile exports slump by 15 per cent to clock US $ 34 billion this year.
And if that’s going to be the number, then it will be the worst export figures for the country in 25 years.
The Ministry of Industry and Trade reportedly said that due to rising cases in the US and Europe, export to these markets will continue to be difficult for Vietnam.
The report added that the fall of 15 per cent is still lower than 20 to 25 per cent drop in global demand this year.
Meanwhile, domestic apparel firms in Vietnam are putting their efforts to increase revenue by producing lower-added value products.
An optimistic Vu Duc Giang, Chairman, Vietnam Textile and Apparel Association (VITAS), said that the recently signed Regional Comprehensive Economic Partnership (RCEP) is in all likelihood going to increase China’s demand for apparels made in Vietnam.
He also said that Japan, another potential market, requires Vietnamese firms to prove their products are sourced from ASEAN countries or Japan to enjoy incentive tariffs, while many Vietnamese apparels are made from materials imported from China.
However, once RCEP comes into effect, even products from Chinese-imported materials will enjoy incentive tariffs.
With tariffs on textile and garment exports to EU being scrapped owing to EVFTA, the industry in Vietnam is expected to reap some rewards going forward.
Till then let’s wait and see what Vietnam’s plans are for the coming year!