HA NOI  (VNS) — Mergers and acquisitions in Viet Nam’s textile and garment industry have increased, in a bid to take advantage of free trade agreements, especially the Trans Pacific Partnership (TPP), experts said.

According to the HCM City Association of Garment – Textile – Embroidery – Knitting (AGTEK), there was a wave of mergers and acquisitions in local garment and textile sectors as local enterprises found they could not fulfill requested orders due to their limitations in capital.

Pham Xuan Hong, deputy chairman of the Viet Nam Textile and Apparel Association (Vitas), said medium- and large-sized enterprises have maintained stable production and business, but small-sized firms have faced many difficulties in their business. Therefore, recently, many small textile and garment companies have sold their workshops and machines and entered other sectors.

In addition, some local enterprises have sold part of their factories to foreign investors, he said, including Chinese investors who have developed a system of processing and production for export products in Viet Nam to take advantage of the TPP deal.

Nguyen Van Hoan, former head of Ha Noi Industrial, Textile, Garment and Fashion College, said foreign investors had difficulties in expanding their production in Viet Nam because some provinces and cities have limited foreign investment in the garment and textile sectors due to concerns about environmental pollution. This has prompted foreign investors to purchase local textile and garment companies that already have production lines and employees.

Further, the Ministry of Planning and Investment said management offices carefully weighed requests before issuing investment licences for large textile and garment projects, since textile, fiber production and dyeing projects often cause environmental problems, reported vnexpress.net. So, some investors have bought factories from local partners.

In 2015, Viet Nam has issued investment licences for 30 textile and garment projects while foreign investment in industry was expected to continue increasing in the near future.

In 2016, part of the US$300 million provided by the Indian government would include investments in projects to manufacture textile and garment materials in Viet Nam, as part of the cooperation between the governments of Viet Nam and India. — VNS

By Vietnamnews

31/12/2015

Quote from: “http://vietnamnews.vn/economy/280565/mergers-acquisitions-increase-in-textiles-garments-market.html“

VIETRADE – The country’s garment and textile sector would likely to grow an average of 11.5% annually between now and 2020, the Vietnam Textile and Apparel Association (Vitas) has forecast.

Vitas said the sector was expected to post an export turnover of US$27.5 billion this year. The value would increase to US$31 billion next year and US$45 billion to $50 billion by 2020.

The Ministry of Industry and Trade (MoIT) reported that the sector earned US$19.18 billion from exports in the 11-month period, surging 18% against the corresponding period last year. Exports of fibre rose 19% to US$2.3 billion.

Vitas chairman Vu Duc Giang said that global integration would facilitate exports of Vietnamese garment and textile products over the next five years.

Following the Trans-Pacific Partnership (TPP), tariffs for these products would reduce from 18% to 0% and from an average 11% to 0% under the Vietnam-European Union Free Trade Agreement.

When these pacts took effect, they would accelerate the development of the garment and textile industry in the long run, attracting more investment in the sector while enhancing the value of local products in the global value chain.

Dau Tu Newspaper quoted the American Chamber of Commerce’s forecast as saying that after the TPP came into effect, Vietnam’s exports to the US would likely to reach US$51.4 billion, with garment and textile products alone hitting US$15.2 billion by 2020.

The garment and textile exports to the US, might also reach US$20 billion by 2025, the newspaper noted. The US is now one of the country’s leading importers of Vietnamese garment goods besides the EU, Japan and South Korea.

Vietnam has been among the top 10 garment and textile exporters in the world for the last 10 years. Last year, it ranked the fifth after China, Turkey, Bangladesh and India.

In order to increase its export turnover, in recent years, the local garment and textile sector have paid effective attention to diversifying material supply sources to ease the dependence on foreign source and increase competitiveness, vietnamnews.vn reported.

To date, it had raised the localization rate to more than 50 per cent, the newspaper added.

Mr. Le Tien Truong, General Director of the Vietnam National Textile and Garment Group (Vinatex), said the group’s subsidiaries had increased investment in material production, adding that their textile fabric output could meet 60% of domestic demand.

Besides ensuring adequate material resources, Truong also emphasized the importance of building a trademark for the nation’s garment and textile products.

He urged the sector to improve its competitiveness in the global garment supply chain.

Meanwhile, the MoIT suggested domestic garment and textile businesses to seek other material suppliers from ASEAN countries, particularly India, to avoid over-dependence on a single market. /.

By VIET TRADE

29/12/2015

Quote from: “http://www.vietrade.gov.vn/en/index.php?option=com_content&view=article&id=2400:garment-textile-exports-forecast-to-grow-115-a-year-to-2020&catid=270:vietnam-industry-news&Itemid=363“

Vietnam established diplomatic ties with more than 170 countries and territories and trade relations with 224 out of 255 markets and territories; and signed 86 bilateral agreements, 46 agreements on investment promotion and protection and 40 anti-double tax pacts.

The economic relations between Vietnam and its current potential partners have developed in both depth and width. However, after joining TPP Vietnam’s economy will be more affected, especially on key goods.

Dr. Vo Hung Dung, Director of VCCI Can Tho Branch believes that joining TPP will give opportunities to Vietnam to export its agricultural and seafood products to large markets within the TPP bloc with a prioritised tariff as well as opportunities for cooperation in high technology and modern agricultural development.

Vietnam has a rather large agricultural production area so it has a high demand in expanding markets for its agricultural products. Yet, the main difficulty lies in the fact that TPP countries tend to limit negotiations, maintain protection and subsidies to local farmers and not open doors by using technical barriers to trade and in the form of hygiene measures.
 

Joining TPP will  give opportunities for Vietnam to expand the market for its fruit. Photo: Phuong Vy/VNA
 

According to Dr. Nguyen Anh Tuan, Editor-in-Chief of the International Research Magazine, the Diplomatic Academy of the Ministry of Foreign Affairs, when joining TPP, Vietnam must eliminate 100% of tariffs for all goods, including agricultural products while there are no technical barriers or having them but not very high. The reduction of tariffs will surely lead to a rapid increase of imports from TPP countries into Vietnam with competitive prices.

For aquatic products, according to the Vietnam Association of Seafood Exporters and Producers (VASEP), 40% of Vietnam’s aquatic products were exported to TPP countries in 2013, including 20% to the US and 17% to Japan. Japan is the major market of Vietnam’s tuna exports, but the tariff is at 6.4-7.2%.
 

Tuna is a potential export of Vietnam. Photo: Ly Kha/VNA

Related to husbandry products which have less competitiveness in comparison with other TPP countries, there is a limitation in production capacity and technology, whereas this sector regularly faces epidemics. Vietnam’s husbandry industry is now the sector providing many jobs for farmers, but with a low and unstable income and it is the most vulnerable.
 

Vietnam’s husbandry sector has less competitiveness in comparison with other TPP countries. Photo: Vu Sinh/VNA

The Vietnam Textiles and Garments Association expects TPP will facilitate Vietnam to increase its export turnover of textiles and garments to 30 billion dollars in 2020 and 55 billion dollars in 2030.

Out of the annual total import tax revenue of 1.3 billion dollars from TPP members to the US, about 1 billion dollars is from Vietnam’s imports and 80-90% of this number is from garment and footwear exporters.

At present the tariffs for Vietnam’s garment and footwear exports to the US are over 7% and 12%. The reality shows that these sectors of Vietnam will benefit when the tariff is lowered to zero. The import tax for Vietnam’s footwear to TPP members will be zero from the current 3.5-57.4%
 

The garment and textile sector will reach 30-55 billion dollars by 2020-2030. Photo: An Hieu/VNA

With a total number of 500 enterprises which now provide jobs for 600,000 labourers, this sector will expect to generate more than 1 million jobs with TPP’s commitments.

Associate Prof. Nguyen Anh Tuan acknowledged that when Vietnam’s footwear sector participates in the global value chain, with its advantages in a “gold” human force, it will provide favourable conditions for implementing the stages using many labourers.

When TPP comes into force, Vietnam is believed to be one of the large beneficiaries from increasing trade with the US and Japan which are the two largest markets of TPP. The tariff reduction will facilitate Vietnam to export its garments, footwear and agricultural products. However, besides the advantages, Vietnam will also face many risks. Therefore, Vietnam needs initiatives and key resolutions to take full use of key products  as a TPP member.
 

 

According to economic experts, 37 out of 97 sectors of export goods are more competitive than partners. These goods, including  garments and textile, footwear, aquatic products and coffee, account for 75% of the total export value of Vietnam, equivalent to 120 billion dollars.

 

By VNA/VNP

28/12/2015

Quote from: “http://vietnam.vnanet.vn/english/tpps-impacts-on-vietnams-key-products/205414.html“

 

Women walk near a Citibank branch in Hanoi, Vietnam. Photo: Reuters

But the hopes could be belied if Vietnam does not improve its business environment

Vietnam’s textile and garment exports to the US from January to November 2015 have reached US$9.98 billion, a year-on-year increase of 11.7 percent. It is expected to gain much higher with the Trans Pacific Partnership (TPP) taking effect. According to the Vietnam Textile and Apparel Association (Vitas), during the 11 months, Vietnam’s textile and garment export value to its other major export markets was also optimistic with $3.09 billion to the EU, $2.53 billion to Japan and $1.98 billion to South Korea.

Luong Hoang Thai, head of the Ministry of Industry and Trade’s Multilateral Trade Policy Department and the deputy head of Viet Nam’s negotiator delegation at the TPP deal, said that the tax value that Vietnamese textile, garment, leather and footwear exporters currently have to pay for the US, is higher than that of other TPP member countries.

The local enterprises must pay a total tax value of $1.17 billion for exporting textile and garment products to the US market.

Therefore, Viet Nam was successful in negotiating with the US to reduce the tariff for Vietnamese textile, garment products from an average rate at 17 percent to zero under commitments of the TPP, Thai said.

To join the zero tariffs, the local exporters must meet origin regulations from material for production under TPP agreement to prevent neighbouring countries from exporting their products to Viet Nam and then shipping to other countries.

The TPP agreement also has flexible mechanisms for Viet Nam in supplying material when Viet Nam does not yet have enough domestic material supply.

The General Department of Customs said that the country’s export value of textile and garment reached $20.6 billion in the first 11 months. Therefore, the local textile and garment industry needs a total export value of $2.4 billion in December to meet the yearly target in textile and garment for this year at $23 billion.

Tran Viet, head of Vinatex’s Legal and General Affairs Department at its press conference on production and business of the group this year held in Ha Noi yesterday said that Viet Nam National Textile and Garment Group (Vinatex), Viet Nam’s largest textile and garment producer, was estimated to achieve a year-on-year export value of 10 per cent to $3.4 billion for this whole year.

However, the group’s pre-tax profit was predicted to reach VND1.35 trillion ($60 million) for this year, similar to the rate in 2014, because depreciation of currencies in some other textile and garment exporting countries such as China, India and Indonesia affected Vinatex’s production and business results in 2015, he said.

This year, the group’s exports to major markets was expected to gain, including a growth rate at 12.95 percent to the US, 5.96 percent to the EU, 7.95 percent to Japan and 8.77 percent to South Korea against 2014.

The growth was due to positive production and business from large Vinatex’s member companies, including Phong Phu Joint Stock Company, Hoa Tho Textile and Garment Joint Stock Corporation, and Viet Tien Garment Corporation, in addition to Garment 10 Corporation and Duc Giang Corporation.

With positive forecasts for domestic garment exports, Vinatex expected next year’s growth of 8 per cent in its total revenue and 10 percent in total export value against 2015.

By YNFX/ Globaltextiles

23/12/2015

Quote from: “http://www.globaltextiles.com/info/detail/001-20383/Vietnam-garment-exports-to-US-reach-US$9.98bn-in-11-months-of-2015.html“

Vietnamese textiles and garment exports will possibly hit US$27.1 billion this year, an increase of more than 10 percent from 2014, local media reported.

Local producers shipped $20.63 billion worth of textile and garment products in the first 11 months, up 8.9 percent from the same period last year, according to the latest figures released by Vietnam Customs.

The US was Vietnam’s largest market with $9.88 billion worth of apparel, up 11.7 percent. EU and Japan were ranked second and third with imports of $3.09 billion and $2.53 billion.

Vietnam’s textiles and garment shipment has been rising strongly, even though there were no remarkable increases in its major markets, such as the US, whose imports rose 4.8 percent year-on-year, news website Saigon Times Online quoted Vinatex representative Tran Viet as saying. Vinatex is the country’s biggest apparel producer.

Viet said, despite the sharp increase in revenues, Vietnamese exporters’ profits have not risen accordingly as they have had to cut their margin to compete with other exporters such as China, India and Indonesia.

In the past few months, these countries have depreciated their currencies, which have in turned made their products cheaper, he said.

Vinatex expected to record exports of $3.4 billion this year, but its profit will be equal to last year’s, around VND1.35 trillion ($59.86 million).

BRUSSELS (VNS) — The European Parliament (EP) adopted an official resolution ratifying the Viet Nam – EU Partnership and Co-operation Agreement (PCA), at a plenary session in Strasbourg city, France, yesterday.

The resolution welcomes Viet Nam’s outcomes in doi moi (renewal) and integration over the past time and hails the country’s role and position in regional and global arena.

It said co-operation between the EU and Viet Nam has developed rapidly since they established diplomatic ties 25 years ago, moving from an initial focus on trade and aid to co-operation and comprehensive partnership.

The EP stressed that the signing of the PCA with Viet Nam demonstrates the strategic significance of the Southeast Asian country as a key partner of the EU in the region and ASEAN.

The parliament committed to widening and deepening the Viet Nam-EU relations across sectors such as social affairs, democracy, human rights, and settlement of regional and global challenges.

In its resolution, the EP expressed its deep concerns over illegal and unilateral actions that cause tensions in the East Sea, threatening peace, security, stability, international trade and fundamental benefits of the EU in the region as well as navigation safety and freedom on the union’s main maritime trade routes.

The EP calls for more efforts from China and parties involved to reduce tensions in the East Sea while stressing it is necessary to address disputes via peaceful means, building trust, and holding bilateral and regional negotiations on the basis of international law, including the 1982 UN Convention on the Law of the Sea (UNCLOS).

French Senate ratifies agreement

Also yesterday, the Viet Nam-EU Partnership and Co-operation Agreement (PCA) sailed through the Senate of France in Paris with 100 per cent of the vote.

The PCA is a framework agreement that looks to adjust the relationship between Viet Nam and the EU and replaces the 1995 Viet Nam-EC Framework Co-operation Agreement.

The deal allows Viet Nam to access the EU market more easily on the basis of the equal, long-term, and stable partnership and comprehensive co-operation.

Signed on June 27, 2012, the pact will come into force after it is ratified by all EU members.

Speaking at a discussion in Paris, Annick Girardin, Minister of State for Development and Francophony, elaborated on the French Government’s views which lauded developments in the comprehensive co-operation between Viet Nam and France over the past time, especially in economics, trade and investment.

She commented on the increasing bilateral trade and the stronger flow of French investments in the Southeast Asian nation.

Helene Conway-Mouret from the Committee on Foreign Affairs, Defence and Armed Forces of the Senate, presented a draft law which is comprised of eight chapters and 65 articles stipulating economic, trade and investment ties, development co-operation as well as the collaboration in justice, education, training, health care and the environment between the two nations.

The majority of the senators at the event echoed the French Government’s views on the fruitful Viet Nam-France relations.

They agreed that the agreement should be soon ratified in order to create a legal framework for the affiliation between Viet Nam and the EU, including the Viet Nam-France relations.

Michel Billout, senator from Seine – et – Marne, held that the PCA will pave the way for a mutually beneficial and more intensive and sustainable co-operation framework between Viet Nam and the EU.

He explained that the EU is Viet Nam’s leading economic and trade partner and the country’s important importer.

The PCA, along with the strategic partnership signed by Viet Nam and France in September 2013, is expected to contribute to driving the bilateral relations towards a new period in a more effective and intensive fashion, meeting each side’s demand for development, he said.

Noting with joy the Senate’s ratification of the agreement, Helene Luc, a former French senator and Honorary President of the France-Viet Nam Friendship Association, said the approval has translated the resolve to promote the two countries’ relations into a legal document that advance the bilateral ties to match the strategic partnership.

By VNS

18/12/2015

Quote from: “http://vietnamnews.vn/politics-laws/280061/european-parliament-adopts-viet-nam-eu-partnership-agreement.html“