.jpg "Photo: Tuoi Tre")
As China took the second rank in world economies from Japan, experts described the event as an opportunity for small economies depending on outsourcing, including Vietnam.
Experts predict that China would reduce outsourcing activity in industries using large numbers of workers, such as garment and textiles, and boost development of products with high added value.
The country may lose its advantages of competitiveness in materials and low production costs and face pay increases.
Diep Thanh Kiet, Deputy President of the Vietnam Leather and Footwear Association, forecast that with cheap labour costs, Vietnam would be able to take a large volume of orders in garment and textile, leather and footwear and furniture.
Until now, most Vietnamese garment and textile exporters had enough orders for 2010, and some stopped receiving new orders to give priority to already signed contracts. In addition, prices of export items increased 15 percent over last year in US, Japanese and European markets.
The increase in Vietnam’s export turnover is also credited to the country’s implementation of economic and trade agreements with other countries.
Vietnam’s garment and textile exports to the Republic of Korea increased 80 percent thanks to the tax reduction under the ASEAN-RoK Free Trade Agreement. Meanwhile, the Vietnam-Japan Economic and Trade Agreement helped Vietnam’s garment and textile exports to Japan increase 15 percent over the same period last year.
In the first eight months of this year, Vietnam earned nearly US$6.9 billion from garment and textile exports.
Kiet said that many customers selected Vietnamese footwear instead of Chinese ones for their high quality and reasonable prices.
The country obtained an export turnover of more than $3.2 billion from footwear exports, a year-on-year increase of 18.8 percent. Of this figure, almost $700 million was earned from the US.
However, Kiet showed his worry about the capacity of Vietnamese enterprises if they receive orders transferring from China, which exports about 8 billion pairs of shoes a year. He said for Vietnam to take just 10 percent of that amount, local footwear industry must double its production capacity.
For the garment and textile sector, the lesson will be the same. This means the sector must increase its capacity by 2.5 times to receive 10 percent of orders from China. In 2009, China exported $150 billion worth of garments and textiles, while Vietnam exported $9.2 billion.
To take those opportunities, experts said Vietnamese garment and textile and footwear industries must promptly overcome outstanding problems in human resources, materials and technology to raise capacity and the competitiveness for their products.
