Maintain growth rate of textile and garment exports

In 2024, Vietnam's textile and garment export turnover is estimated to reach 44 billion USD, an increase of 11.26% compared to 2023. This is an impressive figure in the context of the complicated world situation, sharp decline in total demand, and high costs that have negatively affected business efficiency.

Garment production for export at Garment Corporation 10.

Although the number of orders is currently relatively abundant, but in the face of fierce competition, especially in terms of human resources, as well as unit prices that are forecast to continue to remain low, businesses need solutions to "retain" employees, increase investment to improve productivity, and be ready to meet market demand.

Promote investment and development

Chairman of the Board of Directors of Hung Yen Garment Corporation (Hugaco) Nguyen Xuan Duong said that the production and business situation of the unit this year is stable, achieving a good growth rate, with an increase of 8% to 10% compared to 2023. CM price (cost of cutting and sewing finished products) in the past 10 months reached more than 115 million USD, thereby bringing the total export value of the unit to more than 304 million USD, the income of workers also increased by about 8-10% compared to 2023 with an average of 10.5 million VND/person/month. The current number of orders is relatively abundant but the price is still low, unable to return to the price level of the time before the Covid-19 pandemic, causing many difficulties for businesses.

On the other hand, public opinion is also worried that the upcoming US President will impose import tariffs that could be detrimental to Vietnam's textile and garment exports to this market. "Most partners and new customers have placed orders until the end of January 2025 and are waiting for market signals as well as the US textile and garment import tax policy to have plans to continue placing orders," Mr. Nguyen Xuan Duong affirmed. To maintain growth in the coming time, businesses need to have plans to develop and expand new markets such as countries in the Middle East, South America, etc. At the same time, increase investment in machinery and automatic equipment, enhance digital transformation, move towards greening textiles and garments, minimize costs to improve product quality, and increase competitiveness in the market.

Similarly, Chairman of the Board of Directors of Thanh Cong Textile-Investment-Trade Joint Stock Company Tran Nhu Tung said that the unit's revenue in 10 months reached more than 134.2 million USD, up 15% over the same period, reaching 85% of the annual plan. Profit reached more than 10.3 million USD, up 44% over the same period and reaching 150% of the annual plan. At present, the company has received more than 90% of the 2024 order revenue plan and received orders for the first quarter of 2025. With positive signals from the market, especially during the holiday season, the year-end shopping season increases, this will be the time to "accelerate" for units to reach the set goals.

Assessing the import and export activities of textiles and garments in recent times, Chairman of the Vietnam Textile and Apparel Association (Vitas) Vu Duc Giang informed that the total export turnover of textiles and garments of Vietnam in the past 10 months reached 36.11 billion USD, up 9.86% over the same period, of which, the export turnover of garments reached 28.38 billion USD, up 10.54%; fiber reached 3.66 billion USD, up 0.47%; fabric reached 2.22 billion USD, up 11.12%,...; the total import turnover of textile and garment raw materials reached 20.61 billion USD, up 15% over the same period.

Vietnam's textile and garment export activities continue to improve, reflected in the increasingly expanding growth rate compared to the first months of the year. In particular, key export markets such as the US, EU, Japan, China still maintain growth; ASEAN markets, Russia, Canada, etc. are potential bright spots for businesses to promote textile and garment production and export. In addition, the continuing downward trend in freight rates is also supporting the growth of textile and garment exports.

Be proactive in market fluctuations

After the US Federal Reserve (FED) cut interest rates by 0.5% in early September, inflation in the US and the European Union (EU) also tended to decrease, leading to improved consumer demand in Vietnam's two largest textile and garment export markets in the coming time. In addition, factors such as natural disasters, political instability, and policy inadequacies in some competing countries continue to be opportunities for Vietnamese textile and garment enterprises to receive shifting orders.

However, in addition to favorable factors, textile and garment enterprises also face many challenges when Vietnam is still one of the countries inspected by the US Customs and Border Protection (CBP) in the enforcement of the UFLPA in the US. The exchange rate of Vietnamese Dong tends to increase compared to the USD, while competing countries continue to devalue their currencies to create competitive advantages; forecasted decline in consumption in Japan and China; factors of increasing geopolitical conflicts causing instability, affecting the recovery of the global economy, etc.

Regarding this issue, Chairman of the Board of Directors of Vietnam National Textile and Garment Group (Vinatex) Le Tien Truong said that orders will benefit when consumer demand improves during the holiday shopping season. However, demand and unit prices will only really improve from 2025 in a good scenario. Therefore, businesses need to carefully develop appropriate scenarios, paying attention to factors of instability, geopolitical tensions, and potential risks to consumer psychology.

Sharing the same view, Vinatex General Director Cao Huu Hieu affirmed: Enterprises are still under a lot of pressure when the market has not improved. For the garment industry, the pressure on delivery time, unit prices have not improved, product quality requirements are more stringent. For the yarn industry, although losses have been reduced by 80-85% compared to 2023, enterprises still have to face fluctuations in cotton prices and there has been no improvement in yarn selling prices, etc. Therefore, units need to ensure the maintenance of production activities, have solutions to "retain" workers, enhance digital transformation, invest in machinery, automation equipment as well as proactively prepare resources to take advantage of the opportunities brought.

Vitas Chairman Vu Duc Giang affirmed: Although the world situation continues to be complicated, conflicts escalate in many regions; gasoline prices, freight rates fluctuate strongly, economic and trade recover slowly, total global investment declines, natural disasters, climate change, etc., the Vietnamese textile and garment industry still maintains a good growth rate. Export turnover reached 44 billion USD, up 11.26%; import turnover reached 25 billion USD, up 14.79%; trade surplus was 19 billion USD, up 6.93% compared to 2023. Achieving the above results demonstrates the efforts to overcome difficulties of the units as well as the efforts of Vitas in policy advocacy activities, contributing to removing difficulties for businesses, while strengthening in-depth domestic and international trade promotion activities, aiming to expand export markets, diversify customers and products.

With the advantage of 17/19 new-generation Free Trade Agreements (FTAs) taking effect, textile and garment enterprises will have great opportunities to boost exports. However, to maintain stability as well as boost production, the textile and garment industry needs to develop a strategy to diversify markets, customer partners and products with high added value; constantly absorb and innovate automation technology, digital management, proactively adapt to the requirements and demands for sustainable green standards from many export markets, striving to reach the export turnover target of 47-48 billion USD in 2025.

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