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BUSINESS REPORT
BUSINESS REPORT

‘Man-made’ disaster

Mr. Vu Duc Giang, Chairman of the Vietnam Textile and Apparel
Association (VITAS), tells VET’s Song Ha about what the future
holds for the country’s textile and garment sector.

INTERVIEW

% What challenges will Vietnam’s textile where only a few strong businesses exist. % What specific measures would the
and garment sector face in 2024? We need a strong textile and garment textile and garment sector need to take
There will be many challenges and community, to promote the development to address these challenges?
obstacles in 2024. Firstly, political relations of businesses that meet requirements from It is necessary to focus on developing
between major countries continue to face such sub-sectors in the garment sector as domestic raw material sources following
instability and unpredictability. The stan- spinning, dyeing, and textiles. green and circular trends, on meeting
dardization requirements of importing Vietnam’s fashion industry also faces stricter requirements for identifying origin,
countries for the textile and garment sector, a severe shortage of domestically-supplied and on additional taxes that may be
such as creating sustainable fashion prod- raw materials and has done so for many imposed in the future, such as Extended
ucts, recyclable products, and circular- years. Though the government issued a Producer Responsibility (EPR) and the
oriented products, will also be an issue. decision approving the strategy to develop EU’s Carbon Border Adjustment Mecha-
Additionally, in the context of Vietnam garments, textiles, and footwear by 2030 nism (CBAM).
becoming a more deeply-integrated econ- with a vision to 2035, some localities Focus must also be on a strategy to
omy since it entered into many of its bilat- have, however, unintentionally imposed attract investment in fixing supply shortages
eral and multilateral free trade agreements, barriers while calling for investment in under the textile and garment development
not only the textile and garment sector the textile and dyeing sub-sectors due to strategy approved by the government. To
but also all others have faced greater global low awareness. This presents a major achieve this requires supporting mecha-
competition, and this is an issue that the challenge, because if the textile and gar- nisms and policies on land and investment
sector must overcome. ment sector does not have domestic raw in clusters and industrial parks for spinning,
One noteworthy challenge comes from materials and relies solely on imports, it weaving, and dyeing, etc., to create the
within Vietnam’s textile and garment busi- will miss huge opportunities from trade conditions for the industry’s development.
nesses, which currently lack three key agreements offering zero tariffs as there The Ministry of Industry and Trade
resources: administrative technology, indus- is no locally-made fabric. needs to work with localities to prepare
trial fashion design capabilities, and a Solutions for environmental manage- development planning for industrial parks
marketing workforce capable of seeking ment, firefighting and prevention, and that comply with environmental regula-
and selecting suitable suppliers to reach measurement standards, among other tions, and to attract investment in textile
agreements and sign contracts with and matters, also pose significant challenges. and dyeing projects, especially high-end
identify sources of raw materials. Vietnam has joined the global playing dyeing and weaving and knitting projects.
Next is the challenge of linking chains field, so regulations must be in line with There should be a tax mechanism for
and developing a strong business com- international standards without imposing the textile and garment sector, such as
munity. We cannot have an environment excessive pressure on businesses. on-the-spot exports and input value-added

38 Vietnam Economic Times April 2024 en.vneconomy.vn