Apparel Online Bangladesh Magazine Magazine May 2018 | Page 15

COVER STORY
predictions, the country’s export
potential is expected to grow at 15
per cent per annum from 2016-20,
thanks to the Vietnamese textile and
apparel industry which is expected
to reach US $ 50 billion export target
(textile and apparel combined) by
2020.
Advantage Vietnam
or Bangladesh…
Since Vietnam’s accession to
the WTO in 2007, Foreign Direct
Investment (FDI) into the country
has witnessed a surge and a major
beneficiary of the same has been the
textile and apparel sector, which
got a further boost in the lead up to
2015, when the ASEAN Economic
Community came into effect,
transforming the ten-country bloc
(including Vietnam) into a single
market and production base.
As per the reports, the first 11
months of 2017 witnessed a steep
11.9 per cent spurt in FDI whereas
Vietnam received a sum of US
$ 16 billion, mainly driven by the
manufacturing sector. As per data
from Vietnam’s Foreign Investment
Agency (FIA), Chinese investors
reportedly registered 123 investment
projects in Vietnam in the first two
Access to quality
textiles is a common
problem for both
Vietnam and
Bangladesh leading
to increased lead
times. But Vietnam’s
close proximity
to China makes
transporting raw
materials (fabrics
and accessories)
convenient and less
time-consuming
compared to
Bangladesh.
months of 2017 followed closely by
South Korea.
Thanks to its close proximity to
China, many Taiwanese-owned
factories which were formerly
established in China have reportedly
even started moving to Vietnam
to take advantage of low labour
costs and the trade benefits that it
enjoys. The Vietnamese Government
has also invested heavily in the
development of support industries.
In the 2006-15 period, Vietnam was
the second biggest investor in the
development of shuttleless looms and
the biggest investor in ring spindles
and open-end rotors amongst the
ASEAN countries.
The country has also shown marked
expansion in knitting sector as well.
In terms of FDI, as per UNCTAD
Global Investment Trends Monitor,
even when global flow of FDI dropped
by 16 per cent in 2017, net inflow
of FDI in Bangladesh increased
marginally in the first 11 months of
the past year. Bangladesh reportedly
received US $ 2.65 billion as gross
A garment manufacturing unit in Vietnam
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