Evfta: unblock the bottleneck of Vietnam's textile and leather shoes export
Evfta: unblock the bottleneck of Vietnam's textile and leather shoes export
In the short term, the Vietnam EU free trade agreement (evfta) is difficult to inject strong impetus into Vietnam's textile industry and leather shoes industry. However, evfta is expected to help increase the export market share of these two industries and bring long-term benefits.
Evfta develops export market for export enterprises engaged in textile, leather shoes and other fields, bringing opportunities to promote export, especially in the domestic and world economy, which has been greatly affected by covid-19. However, experts believe that after the entry into force of the agreement, enterprises will have to meet many conditions and further improve the quality of production and operation to take advantage of the opportunities brought by the agreement.
Wu Dejiang, President of Vietnam Textile Association, said that the approval of the agreement by the Congress would be good news for the textile industry that suffered losses due to covid-19. After the entry into force of evfta, it will provide enterprises with many opportunities and make positive contributions to Vietnam's economy in the future.
The EU's textile imports amount to US $250 billion annually. At present, the EU is the world's largest textile import market, accounting for 34% of global textile imports. Meanwhile, Vietnam's textile exports to the market account for only 2.7% of the total. After the evfta comes into effect, the textile industry is expected to increase the space for exports to the EU market, according to the evaluation of the business community. Textile exports to the EU are expected to grow rapidly, reaching 67% by 2025.
Wu Dejiang, President of Vietnam Textile Association, believes that expanding textile exports to Europe is of great significance and helps Vietnam reduce its dependence on one market. Enjoying zero tax rate will bring many opportunities for textile enterprises to expand export market. However, to take advantage of this opportunity, enterprises engaged in this field need to prepare in advance, make detailed plans and understand the regulations and requirements of evfta, such as product standards, the needs of consumers in each market, etc. EU is a very picky market, with strict commercial conditions, high requirements for quality standards and product design, as long as an error will affect the whole export activities of the market.
Fei yuezheng, general manager of huanjianhu textile company, said that according to evfta's commitment, the rules of origin are very strict. For enterprises, this is a huge challenge, because the raw materials currently used to produce export products are mainly imported from China or ASEAN countries. In order to maximize the benefits of evfta, both the management and the business community must participate.
Textile enterprises believe that there should be encouraging policies to provide convenience for attracting domestic and foreign enterprises to invest in raw material production. In particular, a mechanism should be established to promote the docking of raw material production enterprises and product production enterprises to form a closed chain to meet the requirements of rules of origin.
Wu Dejiang, President of Vietnam Textile Association, also stressed the promotion of the construction mechanism of industrial zone using modern wastewater treatment, in order to improve the manufacturing dye sewing regulations, contribute to the global supply chain, reduce dependence on imports, and maximize the benefits brought by evfta and other trade agreements.
Shen Deyue, general manager of No. 10 garment company, said that the principle of Vietnam Textile enjoying evfta import tax rate and preferential treatment is that the fabric must be woven in Vietnam or EU, and then sewed in Vietnam. However, at present, the production enterprises are not transparent to the origin of raw materials.
"Evfta has cleared many bottlenecks for Vietnam, and the rest is up to us," said shendeyue's general manager. The EU is willing to import Vietnamese goods, but the core issue is to ensure their origin. It is hoped that under the influence of evfta, the textile industry will seize the opportunity to add value at each stage. "
As for leather shoes, Ruan Guojun, a representative of RONGTONG Limited Liability Company, which specializes in exporting footwear products to the European market, said that since 2020, the company has faced various difficulties in its production and export activities due to COVID-19. As a result, companies expect evfta to help increase footwear exports in the final months of this year. However, the company will face some difficulties in meeting the rules of origin. At present, only 60% of raw materials come from China, and the remaining 40% are imported from abroad, mainly from China. At the same time, due to the lack of internal power, technology investment and production expansion are limited.
Under the background that many leather shoes enterprises still have limited production technology and are gradually improving to meet the requirements of evfta, Ruan Wenqing, secretary general and vice chairman of Ho Chi Minh leather shoes Association, said that at present, Vietnamese leather shoes enterprises cannot take advantage of many opportunities of evfta.
Experts believe that in the short term, evfta is difficult to inject strong impetus into Vietnam's textile industry and leather shoes industry, but it is expected to help increase the export market share of the two industries and bring long-term benefits.
Many enterprises expect foreign enterprises to recognize Vietnam as a potential market, so as to enhance technology transfer and investment in raw material chain.