In the first 7 months of 2022, Vietnam’s footwear exports reached about 14.15 billion USD, up 20.1% over the same period in 2021.
According to data from the General Department of Customs, Vietnam’s footwear exports in the first half of 2022 reached 11.80 billion USD, up 13.5% over the same period in 2021.
In June 2022, Vietnam’s footwear exports achieved a turnover of 2.36 billion USD, up 19.1% over June 2021.
In the first 6 months of 2022, Vietnam most exported footwear to the US. The amount exported to this country accounted for 43.2% of the total export turnover. Followed in second place was the EU, accounting for 24%. Exports to the CPTPP members accounted for 11.8%.
In general, footwear exports of Vietnam to major markets witness double-digit growth in the first 6 months of 2022 compared to the same period in 2021. Exports to the US in the first half of 2022 were 23.2% higher than in 2021. Meanwhile, this number for the EU and CPTPP was 18.9% and 6.9%, respectively.
In 2022, although the pandemic is gradually under control, the world economy will continue to face many challenges such as the Russia-Ukraine conflict, rising inflation, high energy prices, etc. However, the footwear industry in Vietnam has made good use of incentives from new-generation FTAs, especially the CPTPP, and the EVFTA to boost exports.
Up to now, Vietnam has been vaccinated against COVID-19 at a high level, so export activities in general and footwear exports, in particular, have added support to export growth. Therefore, the goal of 2022 for the growth of the leather and footwear industry will be 10-15% compared to 2021. Reaching about 23-25 billion USD is achievable.
Assessing the prospect of the leather and footwear market in the second half of the year, Ms. Phan Thi Thanh Xuan, Vice President of the Vietnam Leather, Footwear and Handbag Association (Lefaso), said that besides opportunities, there would be many challenges. The impact of the international situation, especially on the key export markets of Vietnamese leather and footwear, such as the EU and the US, will affect purchasing power.
In the export market, Vietnamese products are rated as average in terms of quality and price. The industry needs to produce higher-value items to be able to compete in the global market. To do so, importing high-value raw materials from other countries is necessary.
In this aspect, Vietnam's leather and footwear industry has not taken advantage of import opportunities well, although it has promoted exports to markets with FTA countries. Especially for the EU, this market has a good source of high-value raw materials that are suitable for manufacturing products in a higher segment. Vietnam has not yet taken advantage of the opportunity to import new technology and equipment to aim for sustainable production, using green and clean technology.
Under the pressure of the rules of origin specified in the FTAs, the localization rate of the leather and footwear industry has improved significantly, currently reaching 55%, especially for sports shoes, it has reached 70-80%. The footwear and leather industry also sets a target in the coming time to gradually raise the overall localization rate of the whole industry to 70-80%.
However, Ms. Phan Thi Thanh Xuan also admits that the industry still faces difficulties investing and producing raw materials. The tanned leather has to be imported for up to billions of dollars every year because this item is subject to strict regulations related to the environment. That is also a limitation for the leather and footwear industry to increase the localization rate in the coming time.
(First half 2022)
Compiled by VietnamCredit