Vietnam’s garment and textile industry may lose up to VND 11 trillion if export orders continue to be stopped, delayed and cancelled, according to the Vietnam National Textile and Garment Group (Vinatex), which said export orders were continuously cancelled, suspended or temporarily halted beginning mid-March, which will lead to job losses in April and May.
The larger the brand is, the higher the reduction ratio and there is no sign of recovery, according to a report in a Vietnamese news portal.Vietnam's garment and textile industry may lose up to VND 11 trillion if export orders continue to be stopped, delayed and cancelled, according to the Vietnam National Textile and Garment Group (Vinatex), which said export orders were continuously cancelled, suspended or temporarily halted beginning mid-March, which will lead to job losses in April and May.#
If there is no policy adjustment, many enterprises may lose liquidity by the end of April and the unemployment rate will be between 30 per cent and 50 per cent in April and May, Vinatex said.
The estimated loss of the industry will be up to above VND 5 trillion if 30 per cent of workers are unemployed in April and 50 per cent of workers are unemployed in May. If the situation lasts longer, the industry will lose up to VND 3 trillion every month, it said.
The industry has also been importing around $1.5 billion worth of raw materials every month. If 20 per cent of orders are cancelled, $300 million worth of raw materials will not be used and that might become inventory difficult to circulate.
It is estimated that the total inventory in April and May this year of the industry will lose 50 per cent of the value, equivalent to around $300 million. Vinatex alone will lose about $24 million.
Vinatex estimated that if the Covid-19 pandemic ends by the end of May and the economy recovers from June, the garment and textile industry will suffer a loss of VND 11 trillion and the group will lose around VND 1 trillion.
Fibre2Fashion News Desk (DS)
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