Total exports of textiles and garments from Vietnam to the US increased 11.7 per cent to $9.88 billion from January to November 2015. According to the Vietnam Textile and Apparel Association (Vitas), during the 11 months, the export value to other major export markets of Vietnam's textile and garment was also optimistic with $3.09 billion to the EU, $2.53 billion to Japan and $1.98 billion to South Korea.
Once the TPP agreement comes into effect, Vietnam's textile and garment exports to the US are expected to further gain considerably. According to Luong Hoang Thai, head of the Ministry of Industry and Trade's Multilateral Trade Policy Department and the Deputy Head of Vietnam's negotiator delegation at the TPP deal, the tax value that Vietnamese textile, garment, leather and footwear exporters currently have to pay for the US, is higher than that of other TPP member countries. The local enterprises must pay a total tax value of $1.17 billion for exporting textile and garment products to the US market and of $300 million for exporting footwear products.
Therefore, Vietnam was successful in negotiating with the US to reduce the tariff for Vietnamese textile, garment and footwear products from an average rate at 17 per cent to zero under commitments of the TPP, Thai said. To join the zero tariffs, the local exporters will have to meet origin regulations from material for production under TPP agreement to prevent neighbouring countries from exporting their products to Vietnam and then shipping to other countries.
The Vietnam National Textile and Garment Group (Vinatex), Vietnam's largest textile and garment producer, was estimated to achieve a year-on-year export value of 10 per cent to $3.4 billion for this whole year. However, the group's pre-tax profit was predicted to reach VND1.35 trillion ($60 million) for this year, similar to the rate in 2014, because depreciation of currencies in some other textile and garment exporting countries such as China, India and Indonesia.
This year, the group's exports to major markets was expected to gain, including a growth rate at 12.95 per cent to the US, 5.96 per cent to the EU, 7.95 per cent to Japan and 8.77 per cent to South Korea against 2014.
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