Logo of Phnom Penh Post newspaper Phnom Penh Post - Origin rules critical for VN exports of garments

Origin rules critical for VN exports of garments

Content image - Phnom Penh Post
A clothing production line of the Best Pacific Vietnam Co in the northern province of Hai Dương. VIET NAM NEWS/ANN

Origin rules critical for VN exports of garments

To take advantage of free trade agreements and expand exports, meeting rules of origin is crucial for Vietnam’s garment and textile sector, industry insiders have said.

Lower-than-expected export revenue last year showed the industry was facing problems in participating more deeply in the global value chain and expanding exports to niche markets.

Vietnam National Textile and Garment Group director-general Le Tien Truong said 2019 was a difficult year for the industry with export revenue of $39 billion, $1 billion lower than its target.

Despite many expectations for the industry due to the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) and the EU-Vietnam Free Trade Agreement (EVFTA), Truong said it was critical for the sector to make moves to comply with origin rules to enjoy the preferential tariffs in the trade deals.

He said Vietnam needed to invest in fabric production to meet origin requirements when exporting to CPTPP and EVFTA countries.

This would not be easy because Vietnam must compete in terms of designs, quality, prices and delivery time with other major fabric producers like China and India, he said.

Truong said investing in fabric production needed careful consideration in terms of production scale because Vietnam’s garment industry uses less than one billion metres of woven and knitted fabric every year, or 18 per cent of global exports.

If fabric production targeted only Vietnam, production scale would be too small while investing in large-scale production and competition with China and India must be taken into account, Truong said.

Truong said that Vietnamese garment firms should work with global giants to establish value chains and invest in production to meet their demands.

Hung Yen Garment Corporation chairman Nguyen Xuan Duong said that at this time in previous years, his company had orders and contracts up until the end of the second quarter.

However, this year was different, Duong said, adding that many partners only signed short-term contracts. He said they seemed to be more cautious and were watching for developments of the Sino-US trade war.

A report from the Ministry of Industry said many garment firms had only 80 per cent of the order volume for this year as they did the same time last year.

Vietnam Garment and Apparel Association president Vu Duc Giang said Vietnam’s garment and textile sector must speed up reforms with innovations in designs, management, fabric production and building brands.

Giang said that this year, the sector targeted export revenue of $42 billion.

VIET NAM NEWS/ASIA NEWS NETWORK

MOST VIEWED

  • Kingdom's Covid cluster cases jump to 194

    The Ministry of Health on February 25 confirmed 65 new cases of Covid-19, with 58 linked to the February 20 community transmission. The latest cluster cases include nine Vietnamese nationals, five Cambodians, one each from Korea, Singapore and Japan, with the rest being Chinese. This brings the total number

  • Locations shut, dozens more Covid-19 positive

    The Ministry of Health has closed 23 locations in connection with the February 20 community transmission of Covid-19 and summoned for testing anyone who had direct contact with affected people and places. The number of discovered related infections has risen to 76, including 39 women. In a press release,

  • Cambodia's Covid cluster cases rise to 137

    The Ministry of Health on February 24 recorded 40 more cases of Covid-19, with 38 linked to the February 20 community transmission. Of the 40, two are imported cases involving Chinese passengers. The 38 include two Vietnamese nationals and one Cambodian, with the rest being Chinese. This brings the total cases

  • Covid cluster raises alarm, health bodies urge vigilance

    The Ministry of Health and the World Health Organisation (WHO) in Cambodia have expressed great concern over the February 20 cluster transmission of Covid-19 in the community. Both entities appealed for vigilance and cooperation in curbing further spread of the virus. Ministry spokeswoman Or Vandine said

  • PM confirms third Covid-19 community transmission

    Prime Minister Hun Sen on February 20 announced the Kingdom's third outbreak of Covid-19 community transmission after 32 people tested positive in just over 10 hours. Addressing the public from his residence after an emergency meeting, Hun Sen said: "I dub it February 20 Community Event, in which 32 cases

  • Cambodia's cluster cases jump to 259

    The Ministry of Health on February 27 recorded 26 more cases of Covid-19 linked to the February 20 community transmission, bringing the total to 259 in one week. The 26 include three Vietnamese nationals and one Cambodian, with the rest being Chinese. The ministry noted that five of the Chinese