Vietnamese Garment Sector Woos Back Foreign Investors
Despite many Vietnamese garment firms facing significant hardships around a year ago because of orders being shifted to countries with low labour costs and tariffs, such as Cambodia and Bangladesh, the sector has bounced back after investing in technology and adjusting costs and inappropriate policies. A lot of large orders are now returning to the country.
Bilateral and multilateral free trade agreements (FTAs) that the country has signed or is about to sign have also contributed to the trend, a news agency report said. Vietnam is at present involved in 16 FTAs.
Business partners have returned to Vietnam after discovering that product quality and delivery times were not always ensured in other countries, according to the Vietnam Textile and Apparel Association (VITAS).
Japan’s Itochu Group recently bought an additional 10 per cent of shares in the Vietnam National Textile and Garment Group (VINATEX) by spending $47 million. The purchase raised Itochu’s stake in Vinatex to 15 percent, making it the second largest stakeholder behind the ministry of industry and trade.
The Binh Duong province granted an investment licence worth $25 million in March to a garment and textile project by Taiwan’s Apparel Far Eastern Co.
Singapore’s Herberton Ltd. also recently carried out the Nam Dinh Ramatex Textile and Garment Factory project worth $80 million in the Nam Dinh province. The factory is likely turn operational next year with a capacity of 25,000 tonnes of fabric of various kinds and 15 million clothing items a year, creating jobs for around 3,000.
Vietnam is among the world’s five biggest garment-textile exporters and producers. (DS)