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 is ranked 2nd in the world in footwear exports with an estimated export volume accounting for 10% of the world. 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, etc.
It is expected that the export turnover of leather and footwear in 2024 will reach about 26 - 27 billion USD. However, according to Mr. Ngo Chung Khanh, Deputy Director of the Multilateral Trade Policy Department, Ministry of Industry and Trade, the advantages and potential of Free Trade Agreements (FTAs) are huge and have not been fully exploited.
- As a unit directly negotiating and monitoring the implementation of FTAs, how do you evaluate the utilization of FTAs by Vietnamese enterprises in general and footwear enterprises in particular?
Mr. Ngo Chung Khanh: Besides the positive aspects of export turnover, the leather and footwear industry also has a "bright spot" when exporting to FTA markets, which is making good use of the EURO certificate of origin usage rate of nearly 100%.
That shows that Vietnamese enterprises are taking advantage of FTAs very effectively. However, saying that does not mean we are perfect, but we also need to look at the shortcomings.
There are currently 5 groups of issues related to the footwear industry:
Firstly, the issue of raw materials. Vietnam has not yet completely mastered the source of raw materials, and still has to import quite a lot. The source of raw materials to ensure sufficient quality, meet the rules of origin, and meet current standards in FTA markets is a very big problem.
I think that is a big "bottleneck" for the leather and footwear industry, which is also the reason why the Vietnam Leather, Footwear and Handbag Association recently proposed establishing a raw material trading center for the entire industry.
Second, the footwear industry lacks market information and orders are unstable. In 2023, when the market was difficult, orders from some footwear and textile enterprises were very unstable. This year, orders have returned but are not really stable.
Third, capital and technology. For some FDI enterprises, capital is not a problem, but for Vietnamese enterprises, capital is an important issue. Regarding technology, I think this is also a point that Vietnamese enterprises lack.
Fourth, update policy.
Finally, there is the issue of branding. Objectively speaking, in the development strategy of the footwear industry, we have high expectations for building regional brands, but doing so is not simple, because most of us are still processing.
|
Mr. Ngo Chung Khanh, Deputy Director of Multilateral Trade Policy Department, Ministry of Industry and Trade.- The Government has assigned the Ministry of Industry and Trade to coordinate with ministries, branches, localities and associations to develop an Ecosystem to take advantage of FTAs. Could you introduce more clearly about this ecosystem and the benefits of participating in building and operating an Ecosystem to take advantage of FTAs for footwear enterprises?
Mr. Ngo Chung Khanh : The 5 groups of problems of the footwear industry as I just mentioned are the existing reality, synthesized from the opinions of businesses and participating entities. With those 5 groups of problems, we realize that it is impossible for just one or two entities to solve them. For example, the problem related to capital cannot be completely solved by businesses, there must be support from credit institutions.
As for policy-related issues, even businesses in the value chain cannot handle them because they are related to management agencies; implementation is local, issuance is central. Therefore, to handle all 5 groups of issues above, there must be cooperation from all related entities, from the input stage, from the raw material supplier..., to ensure standards and traceability of raw materials.
Then there is the matter of raw material processing, processing and related parties, including importers, distributors in foreign markets, logistics, credit institutions, management agencies... Our thinking is to put everything into one ecosystem. And how to make that ecosystem effective requires research and building a model combining central and local management agencies and enterprises, which currently does not exist.
Building a model that complies with legal regulations and is suitable for reality is also something we are struggling with. We have proposed this model and are seeking opinions.
Regarding the benefits of this model for the leather and footwear industry, I think the first is that it will solve the problems that are being encountered. For example, businesses are lacking raw materials but do not know where to buy them, do not know who is supplying them. If they want to buy, they have to go to market A, market B to negotiate and often do not know the price or quality. However, if businesses know that in the ecosystem there is a company that provides a full source of raw materials, they can feel secure in importing. That is the benefit of solving the source of raw materials, solving the important "bottleneck".
- The Ecosystem model for exploiting FTAs for the footwear industry, if successfully implemented, can clearly help improve the efficiency of FTA exploitation for Vietnamese enterprises. However, to build a successful one is not easy, could you please tell us what are the main challenges when building this ecosystem?
Mr. Ngo Chung Khanh: In fact, we have assessed that it is very difficult, not simple and has 3 main challenges.
Firstly, for this ecosystem to operate, the organizational structure must have an executive board that operates 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 such an executive board, there must be staff, offices, headquarters, and financial resources to operate. We hope that in the future there will be a source of fees from contributions from members, but in the early stages it will be free so that everyone can see the benefits.
During that free period, where will we find financial resources and sponsorship to operate? Budget sources are very difficult, because there is no mechanism. Therefore, we have to mobilize social resources or international funding sources, we hope to do it.
Second, for the ecosystem to function, the subjects must work together and comply with regulations and laws. There must be principles and "rules of the game" and anyone who violates the "rules of the game" will be eliminated. But how to ensure that the subjects comply with the regulations is also a challenge.
Third, 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.
- Can you tell us about the specific implementation plan of the Ministry of Industry and Trade to address the challenges, in order to put this ecosystem into effective implementation soon in the near future?
Mr. Ngo Chung Khanh: We have built a model and are collecting opinions from provinces, associations, businesses and farmers. This process will be implemented until the end of 2024, after which all opinions will be compiled into a draft and sent to relevant ministries, branches, provinces/cities and associations.
After synthesis, it will be submitted to the Government around February 2024, along with continuing to organize meetings with experts to give further opinions. We expect that by September 2025, this ecosystem can start operating.
When sharing this goal, some associations and localities said that this is an ambitious goal, but we are putting pressure on ourselves.
Regarding the challenges, we also envision them as I just presented. First, we have to identify the challenges, and then we need to find ways to deal with them. For example, regarding the financial issue, we are discussing with funding organizations and embassies and the results are quite positive, because they also realize that this ecosystem is not only meaningful to Vietnam but also meaningful to themselves, helping them to have effective connections in both directions.
Besides, we have to gradually draft operating rules and regulations to make them easy to understand and practical for everyone to understand and comply with.
In addition, we also clearly define the benefits for each participating entity. From central and local agencies to financial and logistics organizations, associations, businesses, etc., when participating in this ecosystem, they all have benefits, the benefit is that daily problems will be resolved quickly and effectively.
Thank you!
Source: https://baophapluat.vn/doanh-nghiep-da-giay-chua-tan-dung-het-loi-the-va-du-dia-cac-hiep-dinh-fta-mang-lai-post528220.html
Comment (0)