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    Vietnam'S Textile Goals Have Failed. The Buyer Was Rejected By The Buyer, $20 Million Of Goods Were Left Behind, And A Large Number Of Orders Would Be Abandoned.

    2020/3/25 13:14:00 1

    Vietnam Textile

    As the third pillar of Vietnam's exports, the textile industry has always been the top priority for Vietnam's development. According to Vietnam's statistics, in 2019, the United States and the European Union accounted for two of the largest buyers of Vietnamese textiles by 45% and 13% respectively. However, with the increasing epidemic in Europe and America, Vietnam's textile industry has plummeted in the US and Europe. Recently, Vietnam's textile exports have been reported for a long time.

    Vietnamese textile industry has been ordered to stop by US law

    Or $20 million is facing unsalable merchandise.

    According to Vietnamese media reports, Truong Van Cam, vice chairman of the Vietnam textile and Garment Association (VITAS), said recently that the European Union and the United States, the largest exporter of Vietnam's textile industry, had ordered telephone calls to stop ordering products from Vietnam. Vietnam is expected to reduce exports to the EU by 8% in the first and second quarters of 2020, due to a sharp reduction in demand from the EU.

    Take TNG, a clothing manufacturer in Taiyuan, Vietnam, for example, according to the company, a French company has cancelled orders for clothing with the company. In addition, its buyers in the United States also announced that they would cancel or postpone their orders, and the accumulated orders that were cancelled or postponed would be an alarming figure. According to TNG statistics, the container that the company should have shipped to the European Union and the United States with a total value of up to US $20 million is still stuck in Vietnam and cannot be exported.

    Not only is TNG, but Vietnam's other Hu Zhiming textile company, which is mainly exporting to the US, has recently connected to the US buyers' stop call, and at least stopped ordering for three weeks. In addition, Vietnamese companies are generally very worried that many enterprises in Europe and the United States claim to be delayed orders, but with the development of the epidemic, it is likely to evolve to stop orders.

    This makes Vietnamese textile companies have to start thinking about reducing production lines, reducing staff work hours, and reducing staff salaries to reduce costs in order to cope with a possible large-scale withdrawal. This was unthinkable a month ago. In the early March, Vietnam's textile industry was still complacent and bought enough textile raw materials to meet the demand for production in March and April. Now, it is the same thing.

    Just solved the supply problem and met the US law.

    Vietnam's textile target of 42 billion 500 million US dollars will fail.

    The successive suspension of orders from European and American enterprises is a great blow to Vietnam. According to Vietnam's target, Vietnam's textile exports reached US $42 billion 500 million in 2020. In fact, in the first 2 months of 2020, due to the difficulty of purchasing raw materials in China, Vietnam's textile and clothing exports did not grow as expected, but dropped by 3.5%, which was only 5 billion 300 million US dollars, which is still quite a long distance from the average monthly target value of us $7 billion 100 million.

    Vietnam's dependence on China's textile raw materials is very large. According to Vietnamese statistics, in 2019, Vietnam imported 60% of its fabric and fiber market and 55% of it came from China. At the end of February, China resumed most of its raw material supply, and the Vietnamese textile industry finally succeeded in acquiring large quantities of raw materials exported by Chinese enterprises, which could roughly meet the production demand in March and April.

    This makes it impossible for Vietnam to complete its export targets set in 2020. Because if Vietnam wants to achieve that goal, the average export of the textile industry in the coming month must be 3 billion 720 million dollars. At present, the withdrawal of European and American enterprises and the possible withdrawal of the epidemic in the future will make it difficult for Vietnam to achieve the export target of $42 billion 500 million. In fact, Vietnam's export target of 40 billion US dollars in 2019 has been lost, with a real value of only US $39 billion.

    The European Union and the United States

    No restrictive measures were taken for Vietnamese textiles and clothing.

    According to Yue Tong news: Chen Junying, Vietnam's Ministry of industry and trade, said in March 20th at the meeting of the steering committee of the new crown pneumonia epidemic prevention and Control Committee of the Ministry of industry and trade of Vietnam, at present, the EU and the United States authorities have not taken any restrictive measures on textiles and clothing from Vietnam.

    Chen Junying said that the European countries' "closed" measures led to the impact of the enterprises. The main reason was that the importers of the market were also affected by the epidemic. At present, the EU and the US authorities have not taken any restrictive measures on textiles and clothing from Vietnam. However, orders from the two main markets of the European Union and the United States are being postponed and cancelled, prompting Vietnamese authorities to immediately formulate solutions to help businesses reduce losses.

    Xie Huangling, director of the European market division of the Ministry of industry and trade, said that after being announced by some partners in Europe and the United States to stop importing textiles and clothing from Vietnam, the Department has communicated with the European Union delegation in Vietnam and the US embassy in Vietnam.

    The representative of the European Union delegation to Vietnam said that the EU's closing the border was just a quarantine measure to ensure the health and safety of the people. The EU's goods and services, especially food, medicine and other necessities continue to circulate normally, because the measures do not directly affect the import and export activities between Vietnam and the European Union.

    Xie Huangling believes that this measure will only affect the journey of individuals and transport activities, while trade activities will not be restricted. However, from the economic point of view, the circulation speed of transportation, customs clearance, warehousing, loading and unloading, and sale will also lead to economic and trade activities and service activities.

    On the other hand, the goods exported to the EU by the air force are the most serious ones, because Vietnam's maritime exports account for 30% of the total and 39% of the goods transported by air. Delays and reductions in flights may affect the circulation of goods.

    Similarly, the representative of the US embassy in Vietnam said that the United States had not taken any measures to stop Vietnam's merchandise exports to the market.

    However, Xie Huang Ling believes that, due to the impact of the new crown pneumonia epidemic, a series of retail systems in Europe and the United States are closed, so footwear and textiles and other non essentials will be affected.

    Zhang Qinghuai, director of the Bureau of industry and commerce, believes that the import and Export Bureau needs to find new markets for the textile industry, especially after the epidemic is brought under control, to promote export activities of textiles, clothing and footwear to China, Korea and Japan.

    Ruan Jinzhuang, deputy director of the import and Export Bureau, said that next week, the Department will work with enterprises to help resolve the difficulties.

    The European Union and the United States are the two main export markets in Vietnam. In 2019, Vietnam's trade surplus with the EU market was nearly US $26 billion 600 million, of which billions of dollars were exported, including textiles, footwear, agricultural products, machinery and so on. In 2019, Vietnam exported nearly $15 billion to the US textile and clothing exports.

    According to data from the General Administration of customs, despite the impact of the new crown pneumonia epidemic, exports of textiles and clothing to the US in the first two months of this year still amounted to about US $2 billion 300 million.

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