Pham Xuan Hong, chairman of the HCMC Textile and Garment - Embroidery Association, said the garment industry has remained sluggish in the first two months of this year, and some firms are barely breaking even.

Workers at garment firm GARCO10's factory.

"So far this year the global demand for Vietnamese textile products has been weak due to the ongoing tensions and consumers tightening their purse strings."

Nguyen Gia Khanh, chairman of the Shoes and Leather Association of HCMC, said only three or four out of every 10 footwear firms have seen orders increase.

"We have not seen any glimmer of hope. The two main markets for Vietnam's garment and footwear exports, the U.S. and EU, are still affected by the tensions between Russia and Ukraine."

Le Hoang Tai, deputy director general of the Trade Promotion Agency, said garment firms’ inventory is in excess due to low demand last year.

Exports declined by over 9% to US$40 billion last year, Tai said at a press conference on Friday.

This year major markets like the U.S. and EU further cut their garment purchases, and the weak demand is expected to continue well into this year due to the global economic slowdown, he said.

Furthermore, garment firms have higher standards to meet with the implementation of the Extended Producer Responsibility policy and the Carbon Border Adjustment Mechanism, the shift towards sustainable fashion, green transformation, and digital conversion, he said.

Meanwhile, high transport costs are increasing product prices, he added.

Shipping costs from Vietnam to the U.S. and Europe have increased significantly since the end of last year.

To help garment and footwear businesses develop and get new orders, government agencies are planning various support measures, Tai said.

They include organizing several trade fairs and exhibitions to connect buyers and sellers.

The Trade Promotion Agency is collaborating with event organizer Messe Frankfurt to organize the Vietnam International Trade Fair for Apparel, Textiles and Textile Technologies 2024 (VIATT 2024) from February 28 to March 1. For the first time a Vietnamese exhibition will see the participation of over 400 companies.

It is being held to create links between Vietnam’s garment and footwear industries and the global market and attract investment from major foreign textile companies.

Tai advised garment and footwear businesses to focus on researching and developing new products and materials, speeding up the sample-making process and improving product quality to be able to accept demanding orders and align with new trends.

The garment and footwear sectors might see a recovery in the third quarter of this year, he said.

This year the garment industry targets exports of $44 billion, a 9.2% increase from 2023.

Vietnam introduces garment and textile products in India

The Vietnam Trade Office in India arranged a pavilion to introduce Vietnam's textile and garment products at Intex South Asia, an international textile sourcing show opened in New Delhi on December 7.

Worst is over for garment, footwear exports, growth next year

Garment and footwear exports have slumped from the beginning of this year but the drops slowed in recent months, signaling a slight recovery in the industries, experts said.

Textile and garment enterprises adapt to market fluctuations

The total export turnover of the textile and garment industry exceeded 26 billion USD in the first eight months of this year, down 16.4% over the same period in 2022 and only reaching 65.5% of the year’s plan. The textile and garment industry faces many difficulties due to declining consumer demand, increasing competition, and falling orders.

Restoring the growth of the textile and garment industry

The total export turnover of textiles and garments in the past 7 months amounted to 22.7 billion USD, down 14% compared to the same period in 2022. Although exports decline, the situation is improving as the downward momentum has narrowed to 14% compared to more than 20% in the first months of the year. To grow quickly, enterprises need to deploy solutions optimising production, actively apply technologies and switch to “green production” to increase market share in major markets.

Factors contribute to Vietnam’s success in garment & textile industry

According to fibre2fashion.com, Vietnam has become the world’s leading textiles and garments exporter.

Source: VnExpress