(First 4 months of 2022)
Regina Miracle International (Vietnam) Co., Ltd was the top textile and garments exporter in Vietnam in the first 4 months of 2022. The company reached an export turnover of 214,346 thousand USD.
According to data from the General Department of Customs, in the first 4 months of 2022, Vietnam’s textile and garment export turnover reached 11.83 billion USD, an increase of 22.2% compared to the same period in 2021.
In the first 4 months of 2022, Vietnam most exported textile and garments to the US. Exports to the US market accounted for 50.4% of the total textile and garment export turnover. Followed in second place is the CPTPP market. Vietnam’s textile and garment export to this market accounted for 14.9% of the total textile and garment export turnover. The EU market took third place, accounted for 10.5%, etc.
Notably, the US is both Vietnam's largest textile and garment export market and a market with a large export growth rate in the first 4 months of 2022, up 26.8% over the same period in 2021. In addition, exports of textiles and garments to several markets grew greatly in the first 4 months of 2022. Exports to Bangladesh increased by 61.9%, UAE by 56.6%, Indonesia by 45.1%, etc.
The total export turnover of Vietnam’s textile and garment products in 2022 is forecasted to reach about 42 - 43.5 billion USD. Despite many existing challenges, the export will continue to be the main growth driver of Vietnam's textile and garment enterprises in 2022.
Many textile enterprises in Vietnam have received orders until the third quarter or until the end of 2022. These signals were partly reflected in business results in the first quarter of the past when many businesses reported profits.
According to the assessment, Vietnam's textile and garment exports will grow well in the last months of 2022, when the economies of big countries continue to recover. In addition, signed Free Trade Agreements have been creating advantages for Vietnam's textile and garment exports. The RCEP agreement is expected to expand export opportunities for the textile and garment industry.
RCEP plans to eliminate about 90% of tariffs on trade between the signatories within 20 years. In the long term, RCEP could create the basis for a new supply chain in the region, in which Vietnam plays a key role. Vietnam targets an average export growth of 6-7% a year from 2021 to 2030.
Small and medium-sized enterprises, which account for 98% of all businesses in Vietnam and contribute 40% of GDP, benefit because the agreement provides an opportunity for them to strengthen the value chain. However, signing RCEP also means that Vietnam is at risk of having to compete more fiercely, both in the domestic and export markets.
For exports, the agreement increases competition from other Southeast Asian countries, some of which have strengths in product types similar to Vietnam. Over time, this could spur Vietnam to move into high-tech manufacturing.
Moreover, RCEP is likely to accelerate China's economic integration with the rest of the Asia-Pacific region, while the United States is not a party to this agreement. Vietnam will continue to benefit from its role as an alternative manufacturing hub as companies adopt the China+1 strategy.
Besides the positive signal, Vietnam’s textile enterprises still face the challenge of fulfilling orders. According to the Vietnam Textile and Apparel Association (Vitas), it is a matter of transport costs 3 times higher than the average over the past 5 years; The disadvantage of the exchange rate makes Vietnam's textile and garments less competitive against rivals.
In addition, companies in the South still lack workers, while this area accounts for about 40% of the total export turnover of the whole industry, creating a labor imbalance. The lack of raw materials in the short term will make it difficult for businesses to meet the order requirement of partners.
Textile and garment exports are showing many positive prospects, the result is a 24.5% increase in export turnover in the first 5 months of 2022. That is the result of the economic recovery in export markets, the main cause of Vietnam's demand for textiles and garments increasing after a period of pent-up by the Covid-19 pandemic. In addition, the positive effects of the Free Trade Agreements that Vietnam has signed have also boosted Vietnam's textile and garment exports.
Compiled by VietnamCredit