At the press conference to inform about production and business activities, labor movement in 2024, and orientation for 2025 of Vietnam Textile and Garment Group (Vinatex) on December 25, Mr. Cao Huu Hieu, General Director of Vinatex, said that up to now, the group has completed and exceeded the plan, revenue and profit exceeding the General Meeting of Shareholders assigned in the meeting last June.
SPECIAL REVERSAL IN THE LAST 6 MONTHS OF THE YEAR
Specifically, consolidated revenue in 2024 is estimated at VND 18,100 billion, equal to 102.8% compared to 2023; Consolidated profit is estimated at VND 740 billion, equal to 137.5% compared to 2023.
To achieve this result, Vinatex leaders said that they had to overcome a very stormy and difficult year, with periods that seemed impossible to achieve. Because in 2023, the Vietnamese textile and garment industry in general, and Vinatex in particular, had to go through a very difficult year. For the first time in 30 years of exporting, in 2023, the export turnover of the entire textile and garment industry decreased by over 11%.
Entering 2024, following the momentum of 2023, the first and second quarters will still be very difficult due to the continued decline of the world economy, rising inflation, more intense political instability, no increase in textile demand, small orders, strict requirements on technology and quality, fast delivery time, especially the unit price at the beginning of the year is still extremely low – the base from 2023.
However, the picture of textile and garment exports in the last 6 months of the year suddenly reversed. Since July, orders have been more abundant, prices have improved a bit. Many Vietnamese textile and garment enterprises have been fully booked with orders until December 2024. And up to this moment, many garment units have orders until the end of the first quarter, even the second quarter of 2025.
Looking at the competitors of the textile and garment industry, Mr. Hoang Manh Cam, Deputy Chief of Office of the Board of Directors of Vinatex, said that this year, Vietnamese textile and garment has achieved the best growth rate among textile and garment exporting powers.
It is estimated that by the end of 2024, Vietnam’s textile and garment exports will reach approximately 44 billion USD, an increase of nearly 11% compared to 2023. With this result, Vietnam has risen to second place after China in total textile and garment export turnover, above Bangladesh.
“After Vietnam is India, up to now, this country has grown by 6.97%. They have similar product lines as well as geographical advantages near Bangladesh, so the trend of shifting orders from Bangladesh to other countries, India is the country that benefits the most”, Mr. Cam informed.
As for China, in the 11 months of 2024, this country exported 273.4 billion USD, an increase of 0.2% over the same period last year. However, the garment industry is a direct competitor to Vietnam, China exported 144 billion USD and decreased by 2.8% after 11 months. Textiles are China’s strength that we cannot compete with, they exported 129 billion USD, up 3.7%.
Bangladesh’s exports in the first 10 months of 2024 reached 27.7 billion USD, down 3.7% compared to the same period last year, with an average monthly export of 2.8 billion USD, while at the peak in 2022 – the time of booming demand, the country exported an average of over 4 billion USD per month.
AIMING FOR A TARGET OF 45 – 46 BILLION USD IN 2025
“The year 2024 has passed very hard, but in the end the textile industry has been rewarded with the efforts of the management team and workers. The average income of workers this year increased by an average of 10.3 million VND/person/month and the entire workforce was still preserved”, Mr. Hieu shared.
Explaining in detail the success of this result, Mr. Hieu said that it was not because the market had turned around 360 degrees, nor because demand had increased terribly, but because of the “luck” of the market. Vietnam’s textile competitor, Bangladesh, was politically unstable (strikes, protests, etc.), so orders were redirected and Vietnam was one of the priority destinations chosen.
Bangladesh is a popular customer market, a very strong competitor to Vietnam in the popular segment, so when orders poured into Vietnam, prices did not improve much, but the quantity was much larger.
Besides the rare “luck”, Mr. Hieu said that many flexible solutions in production management have been proposed by textile units. The market work of enterprises has also been promoted, searching for more new markets on the basis of new generation FTAs that have come into effect, many product lines entering the FTA market have a tax rate of 0. This is a good opportunity for enterprises to fully exploit the strengths of the industry as well as the advantages from FTAs.
In addition, modern management work, applying digital transformation, increasing investment in automated machinery and equipment … also contribute to the success of the textile and garment industry in 2024.
Although 2025 will certainly have many difficulties, forecasts from organizations around the world such as IMF, WB and looking at the results of some major textile and garment markets such as the US, EU, Japan, Korea … many comments say that in 2025, the textile and garment industry will have a good trend.
According to the baseline scenario (when the total global textile demand grows at a base level of 850 billion USD) proposed by Vinatex, Bangladesh will recover its normal textile export level after the second quarter of 2025, at which time fierce competition will return with preferential tariff advantages for less developed countries; meanwhile, Vietnam has disadvantages in labor costs that are nearly 3 times higher than Bangladesh in the textile industry. Therefore, Mr. Cam believes that the textile industry needs to closely monitor and come up with more adaptive solutions. On this basis, it is forecasted that Vietnam’s textile export in 2025 will grow by 5-6%, reaching 45-46 billion USD.
Source: VNECONOMY.VN