Vietnam witnessed a year-on-year (YoY) surge of 23.5 percent in export of textile and garment to earn $18.7 bn between January and May this year amid continuing market uncertainties and rising input costs. Vietnam National Textile and Garment Group (Vinatex) saw a 50-percent surge in revenue. Most companies have orders to fulfill by the end of September. Many are negotiating to gain more for the rest of the year.
Nam Dinh Textile Garment JSC (Natexco) generated over 1.02 trillion VND in revenue by May end—up by 23 percent YoY, according to Trade Union President Doan Van Dung. Natexco suffered severe labour shortage throughout February and March as there were times when up to half of its workers had to take sick leave due to COVID-19 infection.
Viet Thang Corporation has been struggling to keep production going during the first quarter of the year, given that the Russia-Ukraine crisis has caused supply chain disruptions and a spike in input and fuel prices and logistics costs, said company Deputy Director General Dau Phi Quyet. Those expenditures have climbed three- to four-fold, and therefore, all units were having hard time figuring out possible ways to get out of the situation, Quyet said.
Though the company has managed to find stable supplies of inputs, it is having a shortage of imported replacements for equipment components to deal with. It earlier took six to eight weeks to receive deliveries of the replacements, which normally come from Europe. Now the shipments may take up to 12 weeks to arrive. To cut logistics costs, the corporation is prioritising major orders instead of minor ones.
Similar challenges could potentially put the brake on Vinatex’s growth over the remaining months this year, a report by a Vietnamese news agency said.
Vinatex chief executive officer Cao Huu Hieu said record inflation in decades are ravaging major economies, triggering rising inventories and declining purchasing power, and this may have substantial effects on the company’s performance.
To weather the crisis, Hieu has advised domestic manufacturers to prepare themselves with more flexible plans in order to promptly address any market changes.
Vietnam witnessed a year-on-year (YoY) surge of 23.5 percent in export of textile and garment to earn $18.7 bn between January and May this year amid continuing market uncertainties and rising input costs. Vietnam National Textile and Garment Group (Vinatex) saw a 50-percent surge in revenue. Most companies have orders to fulfill by the end of September. Many are negotiating to gain more for the rest of the year.
