TPP drives textile, garment firms to step up production
The move aims to help them take
the advantages of the agreement in export activities after the expected
signing of the agreement at year's end.
Nguyen Dinh Truong,
deputy chairman of the Vietnam Textile and Apparel Association (Vitas),
said after the TPP is signed, Vietnam's textile and garment industry
will have more advantages to develop further.
Localities such
as HCM City, Dong Nai and Binh Duong provinces are expected to attract
more foreign investors in the textile and garment industry in the
future.
The Dong Nai Industrial Garment Company based in Bien
Hoa City, Dong Nai Province, has paid attention to the TPP and received
many Japanese partners coming to conduct discussions about co-operation
after signing of the TPP, said Nguyen Thi Bich Lien, the company
director.
To prepare for the TPP, the Dong Tien Joint Stock
Company has started to build infrastructure for a support industrial
complex for the textile and garment industry, said Vu Ngoc Thuan, the
company general director.
The complex has already attracted
five investors to develop support industrial products for the textile
and garment industry.
Bo Ngoc Thu, director of the Dong Nai
Planning and Investment Department, said US investors in Hong Kong have
planed to invest 1 billion USD in Dong Nai Province to produce material
for textile and garments.
However, local textile and garment
companies will have difficulty in getting a preferential export tax rate
after the TPP is signed because, at present, they have had to import
from many countries almost all of their raw material for production.
If they want to receive the export tax rate of zero under the TPP
regulation, they must import the raw material for the textile and
garment industry only from TPP member countries, Lien said.
To
take initiative in raw material for production, the local enterprises
must pour a huge investment capital into the textile and dye stages, she
said.
Vietnam imports 6 billion metres of cloth for
production of garment exports while the local textile industry produces
just 1.2 billion metres.
Thuan said the difficulty with raw
material will not change over the next few years because investment in
the textile and dye industries is not easy.
Many provinces and
cities have not encouraged investment in these industries because they
are afraid of environmental problems, he said.
Additionally,
small- and medium-sized enterprises having difficulties in capital and
workforce would not be able to approach production and business
opportunities from the TPP, said Thuan, adding that these enterprises
have yet made a planned way to get out of their situation.
Currently, Vietnam's textile and garment industry has 4,000 enterprises
with 70 percent of them being small and medium sized, he said.-VNA