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Garment producers trying to raise localization ratio   2009-12-15 - VietNamNet/TBKTVN

The locally made proportion of garments will likely reach 42-43 percent this year, higher than the previous years 37 percent.


According to Le Tien Truong, Deputy General Director of the Vietnam Textile and Garment Group (Vinatex), by the end of November Vietnam had exported 8.2 billion dollars worth of garment products. It was expected that total exports would be 9.1 billion dollars, on par with 2008.


The Deputy Minister of Industry and Trade Bui Xuan Khu previously predicted total export revenue for the year would be 9.2 billion dollars.


Explaining this Truong of Vinatex said that the export prices in 2009 were lower than 2008. The price of garment products exported to the US decreased by 18 percent in the first 11 months of the year. Though export quantity increased by 13-14 percent, the export revenue decreased by 40 percent, or one billion dollars.


According to the representative from Vinatex Vietnam in 2009 had the highest localization ratio of garment products:  42 - 43 percent. In 2008 it stood at 37 percent.


In the first 11 months of 2009, Vietnam only imported 4.7 billion dollars worth of materials against its 8.2 billion dollars worth of exports.


Garment producers have been happy with the increase in exports to Japan, which has reached 16 -17 percent so far. They have been enjoying tax preferences under the Vietnam - Japan Economic Partnership Agreement (VJEPA) as they have a high localization ratio in products by using Vietnam-sourced fabric.

Truong said that increasing the locally made content in garment products is always the key issue in the garment development plan. Therefore, Vietnam has been paying special attention to the three programmes on fabric, cotton, and training development.

In 2009 Vietnam increased its cotton plantations by 8,000 hectares. The price of the crop has been increasing in the worlds market, which has brought profit to cotton growers who now sell at 29,000 - 32,000 Vietnam Dong per kilo.


Operational textile factories have been expanded, including in Viet Thang, Nam Dinh and Vinh Phu provinces. Two investment projects, a cooperation with South Korean partners, have just been resumed after securing loans from the Bank for Investment and Development of Vietnam.

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