With import tax cuts presented by free trade agreements (FTAs) to which, Vietnam is a member, increasing automation in production and quite favourable factors in the world market, the country’s garment and textile exports are forecast to hit US$200 billion by 2035.
Vu Duc Giang, president of Vietnam Textile and Apparel Association (VITAS), says the US remains Vietnam’s largest garment importer, trailed by the EU and member countries of the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP).
Giang optimistically told the Japanese and Vietnamese media that the garment sector is likely to earn US$34.5 billion from exports this year.
It is expected that after the CPTPP comes into effect in August 2018 and export taxes drop to zero, the country’s garment exports will surge by 3% compared to the estimated figure because Canada, Australia, Mexico, and New Zealand, major importers, currently import about US$40 billion worth of products annually.
The garment sector has great potential for development from now to 2035. However, the sector should make thorough preparations to fulfil the target of US$200 billion in export value by 2035.
The domestic material consumption rate should be raised, aiming at 80% of fibres and 60-65% of other materials by 2030-2035.
According to Vitas, with further investment in fiber production Vietnam is now less dependent on materials from China. Domestic materials can meet 40-45% of the sector’s demand while the rest is imported from China (37%), Japan, Indonesia, the Republic of Korea and Thailand.