The workshop was held to discuss ways to promote the participation of APEC small-and medium-sized enterprises (SMEs) of textile and apparel global value chains.
The event aims to support the deeper and more effective integration of SMEs into the APEC region and also enhance the participation of SMEs in global value chains (GVCs) in general and the apparel sector in particular, Mr. Nguyen Cam Tu said.
The Deputy Minister explained at the workshop that the value chain follows the creation of products or services through different production phases, including physical transformation, the input of various manufacturing services, the distribution of products to consumers and their disposal after consumption. These activities can be conducted within the enterprises or among different enterprises of a particular geographical area.
“In fact, the GVCs are a new and more comprehensive approach to international divisions of labour. It means that any enterprise participating in the process of manufacturing can be considered to participate in the GVCs”, Mr. Nguyen Cam Tu said.
However, access to international divisions of labour based on GVCs would help enterprises have a better understanding of their position in the global market, and therefore they can actively select appropriate phases to maximise their benefits, he said.
It is clear that enterprises in general and SMEs in particular must actively participate in GVCs directly or indirectly. Local businesses have taken no initiative in seeking partners and expanding the market, he added.
Ms. Pham Quynh Mai, Deputy Director of the Multilateral Trade Policy Department under the Ministry of Industry and Trade, did not hesitate to discuss the difficulties faced by the textile and apparel sector despite its fast growth. The sector is still depending on raw materials and materials imported form foreign countries, especially China.
“This will have a big impact on the country’s textile and apparel sector if the market has disadvantageous changes,” she said.
Besidesdomestic firms have yet to pay much heed to how their foreign peers and rivals do business, they are also slow to revamp their production methods and technologies, and raise their competitiveness.
In fact, a lot of support industry companies have joined hands with local garment-textile enterprises which, however, have failed to seek markets for their products, resulting in the collapse of the collaboration. It is the problems in connectivity between businesses that hinder sustainable development of the country’s garment-textile sector as well as its engagement in the GVC, Ms. Pham Quynh Mai noted.
Mr. Le Tien Truong, the General Director of the Vietnam Textile and Garment Group suggested firms should overhaul their production and management strategies, and build a quality troop of labourers, while teaming up with each other to create a national supply chain. It would raise the sector’s competitive edge when joining the GVC.
To access markets, enterprises need strategies and knowledge, while SMEs should sign design and outsourced manufacturing contracts with large enterprises to learn from their experiences, said Ms. Nguyen Huong Tra, a SME development expert at the workshop.
The global garment-textile production scale is expected to double by 2030. The Asian region alone is forecasted to expand its production by 2.4 times and make up more than 60% of the world’s garment-textile output.
In 2015, Vietnam was ranked in the top five largest apparel exporters. Vietnamese textile firms shipped USD 27 billion worth of product last year and aimed to raise that by more than 10 percent to USD 30 billion this year.