Vietnam has not yet taken full advantage of FTAs in footwear exports.
According to the General Statistics Office, in 2023, Vietnam's footwear exports brought in more than 20.2 billion USD, down 15.3% compared to 2022. Vietnam's footwear products have been exported to more than 150 markets around the world, focusing on major markets such as the US, EU, China, Japan, UK...
It is expected that the export turnover of leather and footwear in 2024 will reach about 26 - 27 billion USD. However, according to the Ministry of Industry and Trade, Vietnamese leather and footwear enterprises have not yet fully exploited the advantages and space brought by Free Trade Agreements (FTAs).
Vietnam is a major footwear exporter, but the quality has not increased much, the domestic rate is low, and the added value is not high. Therefore, it is necessary to build an ecosystem that takes advantage of FTAs to increase efficiency.
Dr. Le Huy Khoi - Deputy Director of the Institute for Strategy and Policy Research on Industry and Trade, said that in recent times, the leather and footwear industry has played an important role in the national economy. In addition to increasing the proportion of export turnover, this industry also creates a great driving force for energy growth and increases workers' income.
Production indicators show that since joining trade agreements, the leather and footwear industry has seen positive growth. However, Mr. Khoi said that this growth is not yet sustainable due to the impact of external factors and unstable economic cycles. For example, in 2015, the production growth rate reached 17.8%, but by 2020, this figure had gradually decreased. After that period, the industry recovered with good growth in 2021 and 2022. By 2023, growth is still greatly affected by many external factors, leading to a significant decline.
According to Mr. Khoi, although Vietnam is a major exporting country, the competitive position of the footwear industry is not really stable. We are currently ranked 10-11th in the world in the production of footwear and related accessories. However, because we mainly participate in processing stages, the industry's competitiveness index is not as high as expected. However, the representative of the Institute for Strategy and Policy Research of Industry and Trade affirmed that the Vietnamese footwear industry still has a lot of potential for development.
Deputy Director of the Department of Industry and Trade of Hai Phong City Nguyen Cong Han analyzed that FTAs have created many favorable opportunities for the leather and footwear industry in Hai Phong city to expand its export markets. According to statistics from the issuance of preferential Certificates of Origin (C/O) at the Department of Industry and Trade of Hai Phong, in the first 8 months of 2024, the total export turnover of footwear products to FTA markets of enterprises in the city and some neighboring provinces increased by 8% over the same period.
Some markets have growth rates of over 10%, such as: Europe (13%), Korea (13%), CPTPP (15%), ASEAN (17%), Hong Kong (27%). In terms of turnover proportion, C/O granted to the European market accounts for 52.28%, China 11%, Japan 8.9%, CPTPP 8%...
Mr. Nguyen Cong Han also pointed out many challenges, including the difficulty of enterprises being self-sufficient in finding sources of raw materials, being dependent or being assigned by import partners. There is even a lack of information and foreign regulations, including factors related to taking advantage of FTAs and difficulties in building brands.
Building an FTA ecosystem for the footwear industry for sustainable development
According to experts, building an FTA ecosystem for the footwear industry is a practical solution to help businesses optimize benefits from FTAs, as well as sustainable exports.
Ms. Nguyen Thi Ngoc Mai - Center for Product Design and Development - Footwear Research Institute said that private enterprises and craft villages all want to bring their products to the international market. However, they face major technical barriers, from raw materials to final products, causing many products to not meet export standards. Therefore, building a technical standards system for the footwear industry has become a key factor to control input materials and improve the quality of exported goods.
According to Mr. Ngo Chung Khanh - Deputy Director of the Multilateral Trade Policy Department (Ministry of Industry and Trade), for this ecosystem to operate, the organizational structure must have an executive board operating in the form of an independent company, with a board of directors, departments and divisions. The executive board will be the "soul" to operate, helping the initiatives and connections of the subjects come to life.
To have an executive board, there must be staff, offices, headquarters, and financial resources to operate. In addition, for the ecosystem to operate, the subjects must work together and comply with regulations and laws.
"There must be principles, "rules of the game" that anyone who violates will be eliminated. But how to ensure that entities comply with the regulations is also a challenge. More importantly, how to encourage and mobilize businesses and entities to participate voluntarily and effectively. To encourage them, we must first show them the benefits of participating in the model," said Mr. Ngo Chung Khanh.
Mr. Khanh believes that when there is an ecosystem, the requirements and desires of businesses will be handled more effectively, quickly and practically. This will help promote the efficiency of business operations.
It can be seen that the main challenges in building an ecosystem to take advantage of FTAs for the leather and footwear industry include applying international standards and ensuring compliance with environmental and labor requirements. But if successful, the new ecosystem will help Vietnamese businesses improve efficiency and maximize the benefits from the FTA.
Source: https://baophapluat.vn/chia-khoa-giup-doanh-nghiep-toi-uu-hoa-loi-ich-tu-cac-fta-huong-den-xuat-khau-ben-vung-post528398.html
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