Composite Fabric,bonded fabric,Lamination Fabric Lamination Fabric News Vietnam’s textile industry is in trouble! Overseas orders drop sharply, Vinatex plans to furlough 10,000 workers

Vietnam’s textile industry is in trouble! Overseas orders drop sharply, Vinatex plans to furlough 10,000 workers



According to statistics from the Johns Hopkins University website, as of 15:00 on April 20, Beijing time, Vietnam had 269 confirmed cases and zero deaths. However, although the epidemic in Vietnam has been well…

According to statistics from the Johns Hopkins University website, as of 15:00 on April 20, Beijing time, Vietnam had 269 confirmed cases and zero deaths. However, although the epidemic in Vietnam has been well controlled, due to the continued spread of the epidemic abroad, Vietnam has received significantly fewer orders this year, and some export industries in Vietnam will also be greatly affected.

Vietnam’s textile industry will face a sudden loss of orders, which may cause catastrophic losses to many clothing manufacturers. In order to survive this economic winter, Vietnamese manufacturers Measures are being taken to control costs. Vietnamese clothing manufacturer giant Vinatex has more than 200 factories and as many as 100,000 workers in the group. However, orders from foreign countries have decreased, and the group is planning to furlough up to 50,000 workers.

Data from Vietnam’s Ministry of Industry and Trade show that orders for Vietnamese textiles and footwear will drop by about 70% year-on-year in April and May 2020. Even if the global epidemic eases at the end of May, Vinatex will still lose 1 trillion VND (approximately US$42.4 million), which is double its 2019 net profit of 510 billion VND.

Vinatex CEO said: According to the current situation, 30-50% of job opportunities will disappear by May. It is worth mentioning that Vietnam’s textile industry has been greatly affected by raw material supply problems before, and Vietnam’s manufacturing industry seems a bit fragile under the epidemic.

Data show that Vietnam’s textile industry is an important part of the country’s export market, accounting for about 10% of the total export value in 2019. If the textile industry is affected, Vietnam’s export market will not be much better. Vietnam’s export data in the first quarter reflects this well.

According to the Vietnam News Agency, Vietnam’s export activities are facing many difficulties amid the epidemic. According to statistics, in the first quarter of 2020, Vietnam’s total exports reached US$59.08 billion, a year-on-year increase of 0.55%, and imports reached US$56.26 billion, a year-on-year decrease of 1.9%, achieving a trade surplus of US$2.8 billion.

In the first two months of the first quarter, the epidemic has not spread in the United States and Europe, and Vietnam’s exports can remain normal. However, exports are sluggish in just one month, and it is almost Given the negative growth in Vietnam’s exports in the first quarter, it can be seen that if orders drop again in the second quarter, the probability of Vietnam’s exports shrinking will greatly increase.

According to Bui Zhongxiu, deputy director of the Trade and Service Statistics Department of the General Administration of Statistics of Vietnam, most export orders from the United States and Europe have been suspended or canceled. If the epidemic situation in the second quarter Without improvement, Vietnam’s export activities will be severely hit. In addition to China, the United States and Europe are among Vietnam’s largest export markets, especially for industries such as textiles and clothing, leather shoes, and aquatic products.

It is not easy for industries in Vietnam that are extremely dependent on overseas orders to find other alternative markets in the short term. Even if they find it, it will be difficult to make up for the two markets of the United States and Europe. Loss from the decline in exports, especially Vietnam’s subsequent orders and export activities, will depend on the epidemic control situation in these two regions.

The most severely affected areas are the United States and Europe. The number of confirmed cases in the United States exceeded 750,000 at 5:00 on April 20, Beijing time. Therefore, it can be expected that orders from the United States and Europe will drop significantly in April and May this year. Orders from June have not yet been decided, and a rapid recovery is not expected.

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Author: clsrich

 
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