|Textile and garment production for export at Hue Textile and Garment Joint Stock Company
Making efforts to overcome challenges
In 2023, the Vietnamese textile and garment industry faced numerous difficulties and challenges as the EU and the US imposed regulations requiring exported products to meet "green production orders" in order to meet import conditions. Due to decreasing demand and prices, many textile and garment enterprises faced a shortage of orders and stagnant production.
Facing countless difficulties, to maintain and develop while ensuring stable employment for nearly 5,000 workers, Hue Textile and Garment Joint Stock Company took a different path. They decided to build and implement a development strategy for the 2023-2028 period and a vision until 2035.
According to the company's CEO, Mr. Nguyen Van Phong, to maintain and develop the enterprise in a sustainable direction, the company is building a strategy to make Hue Textile and Garment a reliable partner of major fashion brands and meet the highest customer requirements. This includes establishing a sustainable and modern management system, with automation and software-based management, building Hue Textile and Garment with a foundation of green production, clean raw materials and energy, environmental protection, as well as participating in the supply chain of the Vietnam Textile and Garment Group and the global supply chain.
| Data updated from the Department of Industry and Trade - Chart: Publishing Department
Along with the business strategy, to overcome difficulties and meet customer demands, in 2023, Hue Garment Corporation implemented several infrastructure investment projects to improve productivity and product quality. These projects included investing in additional textile factory equipment, investing in a 3-story garment factory, constructing a 4-story raw material warehouse for garment production, and equipping steam boilers, and thermal oil furnaces. Thanks to the synchronized implementation of multiple solutions, in 2023, the revenue reached 185 trillion VND, exceeding 98% of the set plan, and the profit reached 11 billion VND, nearly 93% of the previous goal.
In addition to the textile industry, wood chip production also encountered many difficulties, and the output decreased significantly, reaching only 780,000 tons, witnessing a decrease of 4.2% compared to the same period in 2022. The reason for this is the sharp decline in global paper market consumption, with traditional market partners such as Japan and China temporarily suspending imports or reducing product prices (a 30-40% decrease compared to 2022). As a result, there is currently a large inventory of goods in the local businesses, leading to production cuts and an active search for solutions to consume the products in the future.
According to the Department of Industry and Trade data, the total export turnover in 2023 is estimated to reach 1.1 billion USD, a decrease of 2.02% compared to the same period in 2022, achieving 79% of the 2023 plan. In particular, the domestic capital enterprises reached 693.35 million USD, a decrease of 4.64%, while the foreign-invested enterprises reached 406.66 million USD, an increase of 2.8% compared to the same period in 2022.
Leaders of the Department of Industry and Trade believe that the low export-import turnover is partly due to the global economy continuing to face many difficulties and the possibility of a recession, with high inflation in many countries leading to a tightening of monetary policy. The reopening of China also creates intense competition for similar exported goods from Vietnam. On the other hand, the ongoing conflict in Ukraine continues to have negative and unpredictable effects, leading to reduced investment and interruptions, resulting in a sharp decline in export prices (a decrease of 15-30% compared to 2022), while bank interest rates and input costs remain high, making it difficult for businesses to boost export activities.
Trying to reach the target of 1.21 billion USD
In 2024, the global economic and political situation is expected to remain complex, with negative impacts on the production and consumption activities of industries in the province, including the export sector. Therefore, purchasing power is expected to recover slowly, and production will continue encountering challenges due to a shortage of orders. In addition, the economic policies of some countries continue to have a considerable impact on countries that rely heavily on exports, such as Vietnam, directly affecting the production and export of key products such as textiles, processing, aquaculture, and wood chips. Furthermore, accessing capital, bank interest rates, and the costs of raw materials and machinery will remain high, affecting the implementation and progress of new investment projects and the additional capacity of the industry, especially in exports.
To achieve revenue of 1.920 trillion VND, an increase of nearly 5% compared to 2023, a profit of 110 billion VND, and an additional income of 5-10%, in 2024, Hue Garment Corporation will continue to invest in modern and automated equipment to meet customer needs. At the same time, they will seek target customers based on their management capacity, expertise, skills, and equipment to increase productivity and product quality. This includes changing management methods, investing in automation equipment, and developing management software, as well as training skills and raising awareness among laborers.
According to the leaders of the Department of Industry and Trade, to achieve the goal of increasing the export-import turnover by 10% in 2024 compared to 2023, reaching 1.21 billion USD, the industry will enhance the dissemination of information through various forms to raise awareness among state managers, businesses, and the public about commitments related to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), and the Vietnam-European Union Free Trade Agreement (EVFTA), ensuring timely and accessible information. Additionally, efforts will be made to strengthen the collection, analysis, and forecasting of domestic and international commodity market trends and provide information, propaganda, and support for businesses to take advantage of preferential commitments.
Another important task is to focus on removing difficulties and obstacles related to the production and business activities of enterprises, creating favorable conditions for existing industrial production facilities and for newly invested projects to go into stable production, well exploiting equipment capacity and investment efficiency, such as Kanglongda factory, Kim Long Motors Hue automobile manufacturing and assembling complex; Garment factory projects of Scavi Hue Company, Thien An Phu Textile and Garment Joint Stock Company, Hugeway Limited Company (Hong Kong), JAVN Hong Kong Limited Company (Hong Kong); Project of enamel frit factory of Vicofrit Joint Stock Company, Hue Frit Joint Stock Company..., contributing to increasing production capacity and creating a breakthrough for the province's industry soon.