The TPP Agreement Will Help Vietnam To Develop Its Textile And Garment Industry.

Although Vietnam

There are still many inherent challenges in the garment industry, but only by the advantages TPP can bring to Vietnam.

Business and experts expect the industry to grow more than 20% in the future.

According to Fan Chuncheng, general manager of Pham Xuan Trinh, the implementation of all relevant commitments of TPP will be the right time for the company to sell more products to TPP 12 member states.

In order to grasp the business opportunities brought by TPP, the company has built a dyeing and weaving plant, and another one from dyeing and finishing to garments has a capacity of 300 metric tons per month.

The production line will be completed by the end of this (2015) year.

In addition, in order to make better use of TPP's advantages, the company will also strengthen cooperation with domestic and foreign manufacturers to form a supply chain.

This will help Vietnam to supply 50% production materials.

According to the world bank's estimate, the output of the textile and garment industry will grow by 21%. By 2020, the export to the US will grow at 90%. The overall growth rate of the Vietnamese textile and garment industry can reach 41%, and the export volume will increase by 11 billion 500 million US dollars in 2020.

According to Le Quoc An, a consultant of the Vietnam textile and Garment Association, the Vietnamese textile and garment industry will gain huge benefits and shorten the gap between Vietnam and other countries' exporters after the implementation of TPP is signed and signed by Li Guoen.

For example, in 2014, Vietnam made up 10% of the total imports of textiles and garments, compared with 37% in mainland China.

However, after the entry into force of TPP, textile and garment products will enjoy zero tariffs, and the competitiveness of Vietnamese products will increase.

However, Fan Chunhong (Pham Xuan Hong), vice chairman of the Vietnam Textile Garment Association, said that the Vietnam textile garment industry will grow by more than 20% after the effective rate of the TPP tax rate, but the more businessmen still face many challenges; the production tableland supply in Vietnam is still low and can only meet the demand of about 20%.

In the United States, the price of raw materials is very high. If Vietnam imports the raw materials from the country, its finished product cost will increase. So far, most of Vietnam's textile and garment materials still depend on the source of the mainland of China.

On the export side, the garment industry still relies on partners such as Hongkong, Taiwan and South Korea, which are the intermediaries of Vietnam's textile and garment products exported to the US, Taiwan, Japan and other markets.

In addition, many foreign manufacturers have recently moved to Vietnam to compete with Vietnamese manufacturers.

Vietnam is mostly small, with poor financing capacity, low productivity and backward technology.

Another major challenge is the rule of origin of TPP. The meaning of "starting from yarn" is that fiber production, cloth production and garment production should be produced in the country of origin.

However, at present, Vietnam's 80~90% for textile and garment industry is mainly imported from mainland China and Taiwan.

Although the TPP consultant country has agreed to increase the proportion of the plateau producing area among its Member States, it is still unfavourable to Vietnam. Its plateau is due to the 2 main suppliers of Vietnam, such as mainland China and Taiwan, which are not members of the TPP.

In addition, the United States also requires TPP to participate in the reduction of imports from the mainland of China, which will also make Vietnam face difficulties in the short term.

If imported from other member states of TPP, prices are higher than that in mainland China, resulting in pressure on Vietnamese textile garments to increase prices.

However, in the long run, this will help Vietnam to reduce its dependence on mainland China, attract foreign capital enterprises and develop its own dyeing and weaving industry in Vietnam.

Therefore, it is suggested that the government should provide comprehensive assistance measures to develop the production area and attract foreign investors to invest.

Vietnam textile and Garment Association is also trying to link all manufacturers to make full use of domestic dyed fabrics and materials, so as to improve the supply of raw materials and meet the requirements of TPP plateau.