Apparel sector in Vietnam in limbo
Published : Friday, 6 August, 2021 at 12:00 AM Count : 429
Nearly one third of apparel and footwear factories have suspended operations due to ongoing Covid 19 pandemic disrupting up to 90 percent supply chains of Vietnam because of shipment delays, bare shelves and higher prices.
In this situation, companies from spider-silk producer Kraig Biocraft to shoemakers Puma and Wolverine have all lamented their challenges in Vietnam in recent weeks, according to Vu Duc Giang, chairman of the Vietnam Textile and Apparel Association (VITAS), BGMEA sources said.
At an online meeting held on last Monday, Vu Duc Giang said, Vietnam which claims to have taken first position in readymade garment exports leaving Bangladesh behind at second has been facing the supply chain trouble due to Covid-19 surge that has forced 30 to 35 percent of the country's apparel and footwear factories to suspend operations.
"I think that a number of those factories, especially small and medium enterprises will even have to close for a long time," he said in the meeting where Bangladeshi RMG manufacturers and exporters had also participated." In the meeting, Vu Duc Giang also noted most of the businesses are unable to afford the live-work accommodations that support the health ministry's '3 in one spot' guidelines, which require employees to work, eat and sleep in one location to curb the spread of infection.
He also informed that vaccination rates in Vietnam are also extremely low, particularly in key production areas in the southwestern and southeastern provinces.
According to Vietnam health ministry data, it has fully vaccinated only 7 lakh people, which is less than one percent of the country's 98 million-strong population since it rolled out its program in early March. It has logged 1.74 lakh cases of infection and more than 2,070 deaths.
The country's garment industry just pushed Bangladesh last year as the world's second largest exporter of clothing sector after China. Though the countries saw profits tumble after spooked brands canceled or hit pause on orders, Vietnam has got benefit from sourcing shifting from China at the beginning of ongoing outbreak, dispatching US$ 29 billion worth of apparel, 6.4 percent of global market, in 2020.
The current outlook appears less rosy for Vietnam's 2.5 million garment workers, 80 percent of whom are women, according to the Better Work initiative.
Regarding the issue, Bangladesh Garment Manufacturers and Exporters Association Vice President Shahidullah Azim said Bangladesh will hopefully retain its first position soon as the factories resumed operation from August 1 and the industries have got huge number of orders this year.