Vietnam’s leather and footwear industry is in good shape to achieve its target this year, according to general secretary of the Vietnam Leather and Footwear Association (LEFASO) Phan Thi Thanh Xuan, who recently said the sector’s industrial production index in 2020 would rise by 11 per cent and the localisation rate of products would hit 60 per cent.
The industry’s footwear and bag export value has been projected to reach $24 billion this year, gaining 10 per cent over 2019 figures, she said.Vietnam's leather and footwear industry is in good shape to achieve its target this year, according to general secretary of the Vietnam Leather and Footwear Association (LEFASO) Phan Thị Thanh Xuan, who recently said the sector's industrial production index in 2020 would rise by 11 per cent and the localisation rate of products would hit 60 per cent.#
Apart from the decrease in the intensity of various trade conflicts across the world, the global economy would gradually recover and orders for footwear and bag would continue shifting from China to Vietnam to take advantage of preferential tariffs from free trade agreements, Xuan was quoted as saying by a Vietnamese media report.
Therefore, LEFASO forecasts that the demand for local footwear products in Vietnam’s main export markets would rise this year. Foreign direct investment (FDI) enterprises would continue to expand production, helping the country’s footwear industry maintain export growth.
According to the association, the industry must develop its support industries and raw materials, and increase labour productivity. It should also encourage investment to develop footwear production in central and southern provinces.
The biggest difficulty facing the leather and footwear industry is the quality of human capital. Businesses must retrain most staff who had not been trained at vocational schools, it said.
In terms of exports, the industry last year gained stable growth and maintained competitiveness in traditional markets. The top five markets—the United States, the European Union, China, Japan and South Korea—accounted for over 82 per cent of total national footwear export value.
The total export value of footwear and bags reached $22 billion last year, including $15.1 billion, or 75.8 per cent, from FDI enterprises.
The gap in export value between FDI and domestic enterprises has been narrowed. Domestic enterprises accounted for 19.7 per cent of the nation's footwear and bag export value in 2017, and that figure surged to 24.2 per cent in 2019.
Fibre2Fashion News Desk (DS)
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