As China took the second rank in world economies from Japan,
experts described the event as an opportunity for small economies
depending on outsourcing, including Vietnam.
Experts predict
that China would reduce outsourcing activity in industries using
large numbers of workers, such as garment and textiles, and boost
development of products with high added value. The country may lose its
advantages of competitiveness in materials and low production costs and
face pay increases.
Diep Thanh Kiet, Deputy President of the
Vietnam Leather and Footwear Association, forecast that with cheap
labour costs, Vietnam would be able to take a large volume of orders
in garment and textile, leather and footwear and furniture.
Until
now, most Vietnamese garment and textile exporters had enough orders
for 2010, and some stopped receiving new orders to give priority to
already signed contracts. In addition, prices of export items increased
15 percent over last year in US, Japanese and European markets.
The
increase in Vietnam’s export turnover is also credited to the
country’s implementation of economic and trade agreements with
other countries. Vietnam’s garment and textile exports to the
Republic of Korea increased 80 percent thanks to the tax reduction
under the ASEAN-RoK Free Trade Agreement. Meanwhile, the Vietnam-Japan
Economic and Trade Agreement helped Vietnam’s garment and textile
exports to Japan increase 15 percent over the same period last year.
In the first eight months of this year, Vietnam earned nearly 6.9 billion USD from garment and textile exports.
Kiet said that many customers selected Vietnamese footwear instead of Chinese ones for their high quality and reasonable prices.
The
country obtained an export turnover of more than 3.2 billion USD from
footwear exports, a year-on-year increase of 18.8 percent. Of this
figure, almost 700 million USD was earned from the US.
However, Kiet showed his worry about the capacity of Vietnamese
enterprises if they receive orders transferring from China, which
exports about 8 billion pairs of shoes a year. He said for Vietnam
to take just 10 percent of that amount, local footwear industry must
double its production capacity.
For the garment and textile
sector, the lesson will be the same. This means the sector must increase
its capacity by 2.5 times to receive 10 percent of orders from China. In 2009, China exported 150 billion USD worth of garments and
textiles, while Vietnam exported 9.2 billion USD.
To take
those opportunities, experts said Vietnamese garment and textile and
footwear industries must promptly overcome outstanding problems in human
resources, materials and technology to raise capacity and the
competitiveness for their products./.