“Member companies of the Vietnam Garment and Textile Group (VGTG) achieved high production and consumption growth in the first quarter of this year, compared to the same period of 2005. Industrial production value reached more than VND2,400 billion, up more than 20 percent, turnover increased by 17 percent, export value earned more than US$120 billion, up 26.5 percent, and profit is estimated at more than VND47 billion, up 104 percent. Companies earning high profit include Viet Tien, Nha Be, Phong Phu, Thanh Cong, Garment 10 and Hanoi. The group contributed more than VND54 billion to State budget, and its profit per capital ratio was 2 percent .This achievement is attributed to enterprises’ push to find new markets and signing orders to fulfill early this year. In addition, the ministries of Trade and Industry have granted automatic visas to certain textile and garment categories, helping enterprises increase exports. In another boon, early this year China was imposed with quotas in the US and EU, so many clients returned to the Vietnamese market. Items with high growth rates were trousers, knitwear and suits . “However, in the past three months some VGTG member companies met difficulties in seeking new markets, and their production and consumption targets were lower than those of 2005. There were two loss-making enterprises. The group has not made any real progress in domestic market efforts and there has not been close coordination among member companies for mutual development .To further improve production efficiency, the group has actively directed its member companies to speed up the restructure and equitisation processes. Companies such as Thang Loi, Nha Trang, Thanh Cong and Binh Dinh began selling shares, while eight other units are following necessary procedures to equitise according to the decision of the Ministry of Industry .Experts forecast that in the second quarter and the following months of 2006, garment enterprises will continue facing difficulties such as fierce competition, shortage of capital for production, labour fluctuations and high input costs due to material price increases. Many enterprises are likely to lack quotas to export products to the US from mid this year, as the group has had to stop granting automatic visas to eight categories .The target set by the group for 2006 is demanding as the group only reached around 22-23 percent of the set target for the first quarter. To obtain a minimum of 25-27 percent of this year’s plan in the second quarter in order to fulfill the growth target, the VGTG is striving to complete its organisation and operation regulations, and financial procedures; speed up equitisation process of member companies; form product groups; build garment and textile material trading centres in Hanoi and Ho Chi Minh City; and expand the operations of the fashion company. Ho Chi Minh City Trade Company and Import-Export Company will also study direct retail overseas .Regarding investment development, the group will focus on upgrading dye factories of the Nam Dinh Textile Company, Thang Loi Garment Company and Viet Thang Textile Company; modernise March 8 Textile Company, Dong Xuan Textile Company and Dong Phuong Textile Company. It will study the means of reallocating and expanding sewing workshops as well as establishing a coordination chain to build industrial garment zones in several localities. It will complete Plans to develop the Vietnamese garment and textile sector by 2015, and vision towards 2020 to submit to the Prime Minister for approval .Source: TMCnet.com .
Date:4/18/2006
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