The Vietnamese leather, footwear and handbag industry has more room forexport development due to increased market demand and shifted productionorders to Vietnam , the Vietnam Economic News reported on August15.
According to the Vietnam Leather and Footwear Association(LEFASO), the leather, footwear and handbag industry has enjoyed manydevelopment opportunities as import demand from foreign marketsespecially the US market is recovering and Vietnam ’scompetitiveness in the EU market has improved.
Starting inJanuary 2014, Vietnamese footwear exports to the EU benefit from aGeneralized System of Preferences (GSP) tax rate of 3.5-5 percent. Manyinvestors are looking for investment opportunities in Vietnam andincreasing the number of their orders to Vietnamese businesses. Foreignpartners have tended to move their orders from China and Bangladeshto Vietnam .
The leather, footwear and handbag exports earnedmore than 5.7 billion USD in the first seven months of 2014, up morethan 19.2 percent from the same period last year.
There were manydomestic and foreign projects investing in the leather and footwearindustry, including supporting industry projects. The Zhu Rui VietnamCo., Ltd from Hong Kong , China , has recently invested 10 millionUSD to produce molds and soles in Binh Duong province. A 16.6-billionVND project is expected to begin operation this year to producepackaging for garment, textile, leather and footwear products.
Negotiationsof many free trade agreements, including a Trans-Pacific Partnership(TPP) agreement, an EU-Vietnam Free Trade Agreement, and a free tradeagreement with the Customs Union of Belarus, Kazakhstan , and Russia, and are expected to be completed later this year or in 2015. Freetrade agreements with ASEAN (Association of Southeast Asian Nations)countries and China , which already took effect, have provided bigopportunities for the leather, footwear and handbag industry.
Directorof Lien Phat Shoes Company Tran Ngoc Lien said that trade agreementswill create both opportunities and challenges. Both domestic and foreignbusinesses are subject to the agreements, while domestic companiesremain inferior to their foreign counterparts in terms of finance andbusiness administration.
LEFASO Deputy President Diep Thanh Kietsaid that the leather, footwear and handbag industry considerablydepends on exports as 90 percent of its products are exported, while thedomestic market is overwhelmed with imported goods. The product’slocalisation rate of strategic investment products remains low.Specifically, the local input of tanned leather is only 30 percent, thatof synthetic leather is 40 percent and that of decorative materials is45 percent.
LEFASO suggested that businesses in the sectorimprove business administration and apply advanced management technologysuch as the Enterprise Resource Planning (ERP) and streamlinedproduction to increase profits and labour productivity and reduceproduction costs. Each business should build its own research anddevelopment team to better satisfy customer’s requirements and improvecompetitiveness.-VNA
According to the Vietnam Leather and Footwear Association(LEFASO), the leather, footwear and handbag industry has enjoyed manydevelopment opportunities as import demand from foreign marketsespecially the US market is recovering and Vietnam ’scompetitiveness in the EU market has improved.
Starting inJanuary 2014, Vietnamese footwear exports to the EU benefit from aGeneralized System of Preferences (GSP) tax rate of 3.5-5 percent. Manyinvestors are looking for investment opportunities in Vietnam andincreasing the number of their orders to Vietnamese businesses. Foreignpartners have tended to move their orders from China and Bangladeshto Vietnam .
The leather, footwear and handbag exports earnedmore than 5.7 billion USD in the first seven months of 2014, up morethan 19.2 percent from the same period last year.
There were manydomestic and foreign projects investing in the leather and footwearindustry, including supporting industry projects. The Zhu Rui VietnamCo., Ltd from Hong Kong , China , has recently invested 10 millionUSD to produce molds and soles in Binh Duong province. A 16.6-billionVND project is expected to begin operation this year to producepackaging for garment, textile, leather and footwear products.
Negotiationsof many free trade agreements, including a Trans-Pacific Partnership(TPP) agreement, an EU-Vietnam Free Trade Agreement, and a free tradeagreement with the Customs Union of Belarus, Kazakhstan , and Russia, and are expected to be completed later this year or in 2015. Freetrade agreements with ASEAN (Association of Southeast Asian Nations)countries and China , which already took effect, have provided bigopportunities for the leather, footwear and handbag industry.
Directorof Lien Phat Shoes Company Tran Ngoc Lien said that trade agreementswill create both opportunities and challenges. Both domestic and foreignbusinesses are subject to the agreements, while domestic companiesremain inferior to their foreign counterparts in terms of finance andbusiness administration.
LEFASO Deputy President Diep Thanh Kietsaid that the leather, footwear and handbag industry considerablydepends on exports as 90 percent of its products are exported, while thedomestic market is overwhelmed with imported goods. The product’slocalisation rate of strategic investment products remains low.Specifically, the local input of tanned leather is only 30 percent, thatof synthetic leather is 40 percent and that of decorative materials is45 percent.
LEFASO suggested that businesses in the sectorimprove business administration and apply advanced management technologysuch as the Enterprise Resource Planning (ERP) and streamlinedproduction to increase profits and labour productivity and reduceproduction costs. Each business should build its own research anddevelopment team to better satisfy customer’s requirements and improvecompetitiveness.-VNA
