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Textile exports to Japan buck slump   2009-04-29 - VietNamNet/Viet Nam News

Viet Nam has achieved remarkable growth in garment and textile exports to Japan at a time when exports to its major markets like the US and the EU have plunged.

The Viet Nam Textile and Garment Group and the Viet Nam Textile and Apparel Association have signed a number of contracts with leading Japanese apparel importers like Shikibo and Mitsui.

It shipped US$220 million worth of apparel to Japan in the first quarter, an increase of 24.9 percent year-on-year.

The Viet Nam Textile and Garment Group and the Viet Nam Textile and Apparel Association (Vitas) have signed a number of contracts with leading Japanese apparel importers like Shikibo and Mitsui.

Vitas chairman Le Quoc An said: "Japanese importers are switching their orders from other countries to Viet Nam, because they appreciate the consistency in the quality of Vietnamese apparel and the skill of Vietnamese workers.

Pham Xuan Hong, chairman of the Sai Gon 3 Garment Joint Stock Company, said: "My company has earned $25 million from garment exports this year, of which exports to Japan accounted for 65 per cent."

Because of the economic downturn, Japanese consumers had cut back on spending and shifted to cheaper products from Viet Nam, he said.

"Currently, we are working to ensure the delivery of 800,000 pieces of denim and khaki trousers to a Japanese partner," he said, adding that once Japanese importers began to trust the quality of the shipments, stable long-term contracts could be signed with them.

Many other large garment companies like Viet Tien, Nha Be and Phong Phu also have contracts to export large volumes of shirts, vests, skirts and towels to Japan.

Phan Van Kiet, deputy general director of Viet Tien Garment Joint Stock Company, said exports to Japan accounted for 33 per cent of his company's total exports, with that country overtaking the US and the EU as the largest importer.

But with most of the raw materials imported, apparel exporters make little profit, and analysts are calling for development of support industries.

The recent signing of the Vietnam-Japan Economic Partnership Agreement is expected to cause a further rise in Vietnamese apparel export to Japan.

Under the treaty, Japan will eliminate on July 1 import tariffs on Vietnamese textiles and garments that use raw materials of Vietnamese, Japanese or ASEAN origin. They are now at 5-10 per cent.

The prices of Vietnamese products will then become lower than that of its rivals, including China.



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