China remained the largest material supplier of Vietnam’s apparel industry last year with nearly US$9 billion, growing over 12% versus 2016 and accounting for 42.7% of total apparel material imports, according to the General Department of Vietnam Customs.
Data from the department shows Vietnam spent US$21 billion importing such material in 2017, making up 10% of the nation’s total import spending and increasing more than 11% against the previous year. Major buyers were foreign-invested firms, news website Dan Tri reports.
It is noteworthy that the import value of textile-garment materials from China was four and five times higher than those of South Korea and Taiwan respectively, the two markets that Vietnam has bought large volumes of apparel materials recently.
In reality, foreign direct investment (FDI) enterprises accounted for a majority of textile-garment material imports. They spent US$6.9 billion on fabrics and US$1.2 billion on cotton.
Meanwhile, the country exported US$26 billion worth of textiles and garments last year and nearly US$4 billion worth of cotton and fabrics.
Thus, the sector enjoyed a trade surplus of only US$5 billion which is also considered the added value. This is low as textiles and garments are among Vietnam’s biggest export earners.
FDI firms shipped abroad more than US$15 billion worth of textile and garment products, accounting for nearly 60% of the export revenue from the products.
Pham Chi Lan, an economic expert, said the increase in textile-garment materials imported from China is due to a shortage of local materials. In addition, enterprises of Taiwan, Hong Kong and China have built their production plants in Vietnam to enjoy a preferential tax rate of 0% when shipping such products to the U.S. and the EU, and most of these firms buy materials from China.
Photo: State Department