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International Financial Corporation( IFC) has launched a US $ 9.9 million project to assist Vietnamese garment and textile companies in enhancing resource efficiency and thereby saving US $ 15 million by minimizing the consumption of water, energy and chemicals. IFC made this announcement at a recently concluded workshop held in Ho Chi Minh City.
Under the programme, the selected 28 suppliers of VF and Target Corporation, who have invested the said US $ 9.9 million, are in cutting, sewing, dyeing, printing, laundry and other garment washing operations. By implementing a combination of low-cost and more complex factory
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projects, these suppliers achieved average water and energy savings of more than 20 per cent. Once all the recommendations under the project are implemented along with an additional investment of US $ 26 million in new equipment, the targeted enterprises will save up to 2.8 million cu 3 m of water and 5,62,000 tonnes of greenhouse gas per year in the next two years.
“ The results of the project in the first stage have proven to be economically efficient, thanks to the saving of resources,” averred Kyle Kelhofer, Country Director, IFC for Vietnam, Cambodia and Laos.
Kelhofer further added that with growing economy and the booming industry, measures to
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increase resource efficiency in the garment industry will open up important opportunities for Vietnam to boost sustainable growth in the private sector.“ It will help local factories save production cost while promoting |
resource-efficient consumption and sustainable development,” he added. IFC further aims to work with other prominent global brands to promote implementation of the programme for Vietnamese outsources. |
The local garment factories in Myanmar plan to export their own branded garments, according to Myanmar Garment Entrepreneurs Association( MGEA). At present, these garment factories are |
exporting their products with the cutting, making and packaging( CMP) system.
“ We are not able to export our products with the Free-On-Board( FOB) system. Presently, we are
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trying to get tax exemption for the FOB system. We are discussing this with the US Government to get some tax relief on the products exported with the CMP system because the garment industry was not |
included in the reinstatement of the Generalized Scheme of Preferences( GSP),” averred U Myint Soe, Chairman, MGEA.
Cottonwear, in the US, is taxed at 10 to 12 per cent and nylonwear is taxed at 37 per cent. The Government collects 6 to 15 per cent tax on FOB system products. The association, therefore, has submitted a proposal to Ministry of Commerce and Ministry of Planning and Finance to get tax exemption for products exported with FOB system.
It is worth noting that the country’ s garment industry earns around 10 per cent of a garment’ s value. Currently, 33 per cent of local garment production is exported to Japan, 25 per cent to South Korea, 2.4 per cent to the US and 2.4 per cent to China.
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