Vietnam is one of the few countries in the textile trade that has shown growth in the export of apparel and textiles in 2022, though the increase remained lower than the target fixed for the year. The exporter expects a difficult time in H1 of 2023.
The apparel exports remained under pressure in the second half of 2022 and are expected to continue in the earlier part of next year. There are however certain positive developments the Vietnamese exporters hope could propel the exports next year as well. The Vietnam National Textile and Garment Group (Vinatex) stated that export estimates by Vietnamese authorities were based on the situation prevailing at the start of the year. However, later events like the Russia – Ukraine conflict and surges in oil prices, inflation, and interest rates, changed the global economic scenario and took the exporters by surprise.
The president of the Vietnamese trade body is hoping that the world would be on a growth path after the H1 of 2023 as he foresees the resolution of global conflicts by then. He predicted that textile exports may surge by 4-5 percent in 2023 compared with 2022. But in case the global uncertainties linger in the Q3 of next year the textile and apparel exports from Vietnam will remain static as they were in 2022. However, if the conflicts and inflation spread to the entire year then the Vietnamese textile exports could register a decline of 4-5 percent.
Against exports of $42 billion in 2021 the exports of apparel and textiles are expected to register an increase of 10 percent to $44.5 billion but it will still be short of the $48 billion target fixed for the year.
In 2023 the quantum of exports is linked to the global economic scenario. In case of improvement after H1, the trade association expects the exports to range between $47-48 billion, but in case of continued global conflicts, the exports could decline to $446 billion. Much, however, would depend on how the global markets adapt to the conflict scenario and how much the Vietnamese exporters succeed in adding new markets. In the positive scenario, the exporters hope that the instabilities in the global market will be brought under control, and all activities of the sector may have recovered by the end of next year’s Q1. In that case, 48 billion USD in revenue is achievable.
Earlier Vinatex for the year 2022 estimated a consolidated revenue of over 19.53 trillion VND (826.84 million USD), up 15 percent from last year, and expect the exports to range between 47-48 gher than the target, and consolidated profit at more than 1 trillion VND, up 14.6 percent from the target.
These figures were In the positive scenario – instabilities in the global market will be brought under control, and all activities of the sector may have recovered by the end of next year’s Q1. In such a case, 48 billion USD in revenue is achievable. VITAS has also advised its members to not commit to deals offering large discounts against a backdrop of a shortage of orders. Vietnam’s top garments and textiles importer is the US with imports worth $18 billion. Asian countries like South Korea ($4.2 billion) and Japan and China ($4 billion) take the second and third spots as importers, respectively.
