Vietnam garment sector puts faith in US market
HANOI - The United States-Vietnam Bilateral Trade Agreement (BTA)
will open new avenues for Vietnamese garment exports to the United
States, according to Le Quoc An, chairman of Vietnam National Textile
and Garment Corp (Vinatex).
When the treaty, expected to be approved by Vietnam's National
Assembly this month, comes into effect, tariffs on goods from Vietnam
entering the United States will drop from 40 percent to around 3 percent.
However, exporters may yet expect challenges and difficulties. The
United States is still uncharted waters for most Vietnamese businessmen;
consumption channels, customer preferences, and their laws are all issues
exporters will have to grapple with if they are to gain a toehold in the
world's biggest market. In addition, Vietnamese goods are more
expensive than their competitors'.
But Vinatex is one firm doing its homework. "We have spent two years
preparing to enter the US market," An said. It opened its first branch in
Hong Kong a year ago and a second in New York in anticipation of
increased access to the US market. "Both have been very useful," An
said. "The Hong Kong outlet has attracted quite some custom, while the
New York branch has been promoting Vietnamese labels among US
buyers."
Private companies and foreign investors in Vietnam have been preparing
for the agreement for some time now. Many enterprises are hoping to
begin exporting under BTA in December. Garment exporters have
requested that financial and credit systems be improved and that Value
Added Tax (VAT) for textile be cut from 10 percent to 5 percent.
An suggested that the Textile and Garment Association should take steps
to improve the image of Vietnamese products - especially in the United
States - and provide information to members and act as a link between
Vietnamese producers and foreign partners.
The chairman predicted that after the BTA comes into effect, the export
of Vietnamese garments to the United States will quadruple to US$200
million next year reaching $1.5 billion by 2005, with the overall figure
topping $5 billion. But to achieve these goals, he cautioned, exports to all
major markets like Japan and Europea, would also have to increase.
Textiles and garment enterprises have sought solutions to raise the
growth of the industry in the coming years. In the first ten months, the
sector brought the country more than $1.7 billion from exports and
expects $2.15 million for the whole year.
Asia Times - November 16, 2001.
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