Due to the impact of the Russia-Ukraine conflict, the consequences of damage caused by the Covid-19 pandemic along with the decline in world economic growth, inflation has increased in some countries, while goods Garment inventories increased, leading to partners and customers limiting large orders and even stopping receiving goods.

ORDERS STRONGLY DECREASED

As a big rival of Vietnam's textiles and garments, Bangladesh is no exception. According to newly updated data from the Bangladesh Export Promotion Department, textile and garment products, which are Bangladesh's main export products (accounting for nearly 90% of export turnover), also experienced negative growth for 2 consecutive months.

In April, Bangladesh's textile and garment export turnover only reached 3.3 billion USD, down 15.5% over the same period, making Bangladesh's export results in the first 4 months of 2023 only equivalent to the same period last year while In the first quarter of 2023, Bangladesh's textile and garment export turnover increased by more than 6% over the same period.

The United States, Bangladesh's largest garment export market, also declined in the first quarter of 2023 due to the economic slowdown as export shipments fell in both value and volume.

Bangladesh's export turnover to the United States only reached 2.13 billion USD in the first quarter of 2023, marking a decrease of 13.33%. Bangladesh's garment exporters and experts say that weak demand due to economic slowdown, high inflation and high interest rates in the United States led to the decline. European countries area.

Predicting the prospects in the near future, garment businesses in Bangladesh believe that their country's exports may have negative growth at least until June due to global economic instability, even the current trend. This will continue until August.

Also a major textile exporting country, India's textile export situation is similar. India's garment export turnover in March 2023 reached 1.45 billion USD, down 16.7% over the same period. Accumulated by the end of the first quarter of 2023, India's garment exports reached 4.35 billion USD, down 11% over the same period in 2022.

As for Vietnam, statistics from the Vietnam Textile and Apparel Association (Vitas) show that in the first 3 months of 2023, Vietnam's total textile and garment export turnover reached more than 8.7 billion USD, down 18.63 billion USD. % compared to the same period in 2022. In the first 4 months of 2023, textile and garment exports only reached a turnover of 11.6 billion USD, down 19.6% over the same period last year. Meanwhile, in the past, the average revenue in the first months of the year was over 3 billion USD/month.

Analyzing specifically the cause, Mr. Vu Duc Giang - Chairman of the Vietnam Textile and Apparel Association, said that due to many reasons such as epidemics, the Russia-Ukraine war, the end point of which is still unknown, and the Fed's interest rate increase. , inflation in major textile importing countries, global purchasing power decreased. In particular, the global inventory of 2022 goods remains in very large quantities, especially with cheap goods, knitted goods, and denim jeans.

Vietnam's key textile export markets include the United States (accounting for over 44%), EU (19%), Japan (18.5%), Korea (15%), and China. Other markets such as Asia, the Middle East, Latin America... the number of import orders is low. Therefore, orders for items such as knitwear, denim, and cheap goods are not as abundant as before due to large inventories in importing countries. However, some products with good effects such as labor protection clothes in factories, plants, forests... grew well. Suit items have also begun to increase in demand again.

For businesses that come up with solutions to diversify markets and diversify products, they already have orders until October 2023. Slower businesses are still looking for orders for July and August.

Also due to the decrease in orders, labor in some businesses also decreased, but Mr. Giang affirmed that the decrease was not much. Because businesses consider the workforce as their number one asset, in difficult conditions, business leaders still strive to find orders to maintain production, reduce working hours... waiting for the market to recover. recover again.

MARKET TRANSFORMATION AND DIVERSIFICATION

Vitas leaders commented that the textile and garment difficulties from last year until now were due to many objective reasons, so this "falling point" will take about 3 years, that is, lasting until 2024, while the "falling point" will last until 2024. ” of previous periods was only 12-14 months.

However, according to Mr. Giang, this "falling point" will not reach the bottom like at the end of 2022 - early 2023, but will gradually recover to a low level and not increase as quickly as in previous years.

Therefore, to stand firm in the face of the prolonged "storm", the textile and garment business community must shift and diversify the market - this is the must-go goal, there is no other way. Instead of depending on traditional markets, we must find separate market segments, especially the markets of CIS countries (Community of Independent States). Orders in this area have begun to increase rapidly.

The next market that textile and garment businesses are targeting is Latin America, Africa, the Middle East, and China. The bright spot is that Argentina is a market for textile and garment businesses to target because the two governments are aiming to sign a new generation free trade agreement. "Enterprises need to find their own path, creating market stability in the coming time," Mr. Giang said.

On the Government side, Vitas leaders said that in the current context, it is necessary to have policies to reduce corporate income tax, reduce interest rates in the financial and banking system, and extend debt payment time to help businesses avoid pressure. payment cash flow.

On the other hand, there should be policies to encourage businesses to borrow capital at low interest rates, applied when Covid-19 occurred, helping businesses have capital to pay wages to workers in months of shortage of orders.

To overcome this difficult period, Mr. Cao Huu Hieu, General Director of Vietnam Textile and Garment Group, said businesses must optimize production activities, improve productivity as well as product quality. In addition, keeping close to customers and the market to have timely and flexible policies according to situations is also necessary.

Minh Toan