The textile and garment industry, Vietnam’s second largest forex earner, will have difficulty fulfilling its goal of US$7.35 billion export turnover in 2007, due to the impact of the US apparel monitoring program, said Vinatex, the country’s biggest apparel maker.
In the first five months this year, apparel exports grew by 24.3 per cent on-year and brought in US$537 million a month on average. With such figures, Vietnam will only reach US$6.5 billion from outbound textile and garment shipments this year if there are no breakthroughs in the remaining months, the Vietnam National Textile and Garment Group said.
The US is now the biggest importer of Vietnam’s apparel products, accounting for 55 per cent of the country’s total garment exports in 2006. Thus, the monitoring mechanism will prevent the industry from reaching its target.
Many US importers have postponed new contracts with Vietnamese textile and garment exporters until August, when the US Department of Commerce (DOC) will announce its supervisory results. If the DoC issues a negative judgment on the Vietnam apparel industry, US importers will take Vietnam off their list of import countries.
The DoC began the supervisory mechanism after Vietnam joined the World Trade Organization in January, and may self-initiate an anti-dumping probe into Vietnamese textiles and garments.
Diep Khanh Kiet, deputy chairman of Ho Chi Minh City Knitting, Embroidery and Textile Association, said this mechanism is unreasonable. Currently, Vietnam ranks just 9th in terms of volume and 6th in value in textile exports to the US. While China, the largest apparel exporter to the US, is subject to the US self-defense policy, among other large exporters only Vietnam faces this kind of supervision.
Kiet added Vietnam accounted for mere 3 per cent of the US’s total apparel imports, and was not a threat to the US textile and garment industry.
If the US conducts a unilateral anti-dumping investigation, Vietnam’s apparel industry will be seriously harmed, thrusting one million garment workers and millions of people in related industries in the Southeast Asian nation into poverty, Kiet said. (VNS, VNN)
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