Textile and garment industry perseveres in overcoming difficulties and seizing opportunities from the market

Fabric and yarn made from green hemp - one of the sustainable materials that the Vietnamese textile industry is focusing on developing. Photo: N.H

Strong recovery

Textile and garment exports in July 2024 reached USD 4.29 billion, up 12.4% over the same period last year. This is the first month in 2024 with export turnover exceeding USD 4 billion and also the month with the highest turnover since August 2022. After 7 months, Vietnam's textile and garment exports reached nearly USD 24 billion, achieving a growth rate of about 6% over the same period last year.

Vietnam currently exports textiles and garments to 113 countries and territories, with major markets including the United States, the EU, Japan, South Korea and China.

According to the analysis of the Center for Industry and Trade Information (Ministry of Industry and Trade), the export of this item will recover better in the coming months; because of season, the third quarter is the time when Vietnam's textile and garment exports reach their highest level in the year. Most garment enterprises have enough production orders until the end of the third quarter of 2024 and continue to negotiate and sign contracts for the fourth quarter of 2024 - the peak production season for Christmas and New Year orders. At the same time, Vietnam's textile and garment exports to major markets such as the United States, the EU, and Japan are recovering well.

In addition, inflation in major economies is well controlled, helping to increase purchasing power. The inventory of brands in 2023 has decreased, and some textile and garment enterprises have now, through industry associations, sought smaller companies to outsource orders. In addition, Vietnamese textile and garment enterprises have also proactively diversified their markets and customers in recent times. Along with that, fashion enterprises in the United States and neighboring countries are looking for supplies from supply chains outside of China, so products from Vietnam are receiving attention, in which the trend of searching for sustainable products is increasing.

However, according to experts, although Vietnam's textile and garment export results are positive, the world economic situation is experiencing many fluctuations, which will affect export industries and the textile and garment industry. Last April, the European Commission (EC) proposed applying a number of new ecological regulations to textiles consumed in the European market to implement the strategy on sustainable and circular textiles with a vision of 2030. According to the EC's proposal, textiles exported to this market must have a long life, be reusable and recyclable... Thus, the fast fashion industry is gradually shifting to sustainable fashion production. In addition, many large manufacturers in the world have made specific requirements for parties in the supply chain of raw materials, technology, and clean energy.

According to Mr. Truong Van Cam, Vice President of the Vietnam Textile and Apparel Association, green and sustainable growth is being promoted by the EU through the implementation of laws, such as the German Supply Chain Audit Act, the EU Supply Chain Audit Directive... which is a big challenge for domestic textile and garment enterprises.

Need to have a raw material supply center soon

According to Mr. Than Duc Viet, General Director of Garment Corporation 10, greening in production is no longer a matter of wanting or not but it has now become a mandatory requirement. The gradual adaptation of Vietnamese enterprises will help export goods sustainably. In response to new requirements and challenges, Garment Corporation 10 has implemented greening production through specific actions such as investing in modern machinery and equipment, using less electricity or investing heavily in solar energy systems, rooftop solar panels, linking production chains in Vietnam and abroad to use the most recycled and natural products to ensure the proportion of fiber materials in the composition of products according to customer requirements.

The Vietnam Industrial Development Strategy to 2025, with a vision to 2035, issued under Decision No. 879/QD-TTg dated June 9, 2014, identified textiles and garments as one of Vietnam's seven priority industries. According to the Ministry of Industry and Trade, to continue developing the industry in the coming period, breakthrough solutions are needed to upgrade the industry's value chain to create more long-term and sustainable benefits.

To do that, it is necessary to promote the development of the raw material supply market towards scale, standardization and transparency, thereby helping businesses in the industry, especially small and medium enterprises, innovate and improve dynamism and efficiency, and have the opportunity to participate more strongly in the industry's supply chain. In the long term, Vietnam needs a trading center and development of raw material supply because when the domestic textile and garment market and industry develop, there will be a need for a place to concentrate samples, distribute raw materials, invest, transfer technology and trade between domestic and foreign businesses.