Global Economy: Vietnam'S Clothing Exports Fell Sharply, And Exporters Moved To Europe

In the first half of 2023, Vietnam's clothing exports experienced a sharp decline. According to the data of Vietnam Textile and Clothing Association, Vietnam's textile and clothing export volume in the first half of this year was 18.6 billion US dollars, down 17.6% year on year, most of which came from clothing exports. The year-on-year decrease in the first five months of this year was 15.6%.

As in the case of other garment exporting countries, the main reason for the decline of Vietnam's textile and garment exports is the reduction of orders in the EU market, which is exacerbated by the Xinjiang cotton ban. Affected by this, in the first five months of this year, the number and amount of clothing imported by the United States from Vietnam decreased by 33.5% and 28.1% respectively year on year. Vietnam's market share of clothing imports from the United States dropped to 15.8% in quantitative terms and 17.4% in monetary terms.

At present, Vietnamese yarn and development manufacturers face many challenges, because manufacturers need to import a large number of raw materials from China, which makes it difficult for Vietnam to provide proof of origin. As a result, American buyers transferred a large part of their purchase orders to other places of origin. In addition to the Xinjiang cotton ban, Vietnamese exporters also encounter other problems, such as the need to adapt to the growing demand for sustainable products.

Judging from the situation in the first quarter of this year, Vietnam's clothing export destination has changed, with exports to Japan increasing by 18.9%, Germany and Canada also increasing by 15% and 20% respectively, of which Canada is an import of clothing into the United States market.

In the first quarter of this year, the unit price of Vietnam's clothing export to the United States rose 11.5% year on year, and the unit price of Vietnam's clothing export to France rose 18%. At the same time, Vietnam's exports of knitted and woven garments to the EU increased by 2.6% and 7.9% respectively. In order to cooperate with the free trade agreement between Vietnam and the EU, Vietnamese exporters may need to take the promotion of exports to Europe as a strategy to offset the adverse effects of the Xinjiang cotton ban.