In the early days of the epidemic, due to the extreme shortage of global anti-epidemic materials, Vietnam, the world’s third largest textile exporter, once said that the country had enough capabilities to become “the world’s largest mask manufacturer.” According to statistics from the Ministry of Industry and Trade of Vietnam, the production capacity of 50 domestic manufacturers in Vietnam has reached 8 million masks per day, which means the monthly output of masks is about 200 million masks. It is precisely because of the strong demand from overseas markets that Vietnam’s textile industry also ushered in a glimmer of hope in the first half of this year. However, as the epidemic stabilized, Vietnam faced new difficulties.
According to a report by Vietnam News Agency on August 21, after entering summer, As the epidemic has been effectively controlled in many countries, Vietnam’s export of medical masks has begun to slow down. Statistics released by the General Administration of Vietnam Customs show that in July 2020, there were more than 62 Vietnamese mask export companies, with a cumulative export of 153.8 million pieces, a month-on-month decrease of 34.8%. So far, in the first seven months of this year, Vietnamese companies have exported more than 711 million masks. The main export markets are the United States, Europe, Singapore, South Korea, etc.
Although the advantages of Vietnam’s textile industry cannot be ignored, this number is still far from the country becoming “the world’s largest mask manufacturer”. For example, as the world’s largest mask producer, due to the clear and complete mask industry chain and high maturity, before the epidemic, China’s maximum mask production capacity was more than 20 million masks per day. Last year, China’s annual mask output exceeded 5 billion, accounting for 50% of the world’s supply. %.
Not to mention, during the epidemic, Chinese companies worked overtime and went all out to produce masks. As of February 29 this year, China’s daily mask production capacity reached 110 million pieces, and the daily output reached 116 million. Based on this calculation, my country’s monthly mask output can reach 3.5 billion, which is obviously far behind Vietnam’s “monthly production capacity of approximately 200 million masks.”
Having said that, the current weak production capacity is not the top priority for Vietnam’s textile industry to solve. The global market consumption is tightening, including masks. The oversupply of textiles is the biggest challenge facing Vietnam, an export-oriented economy. According to the Ministry of Industry and Commerce of Vietnam, Vietnam’s textile exports fell by 21% in July this year.
However, challenges and opportunities coexist. From August 1, 2020, the Vietnam-EU Free Trade Agreement will officially come into effect. According to the agreement, about 99% of bilateral goods trade between Vietnam and Europe Additional charges for goods will be gradually reduced until they are cancelled. The first echelon of products that will immediately cancel charges involves textiles.
In fact, Vietnam-EU textile cooperation has always been a highlight for both parties. In 2019, Vietnam’s exports to the EU have increased from US$2.8 billion in 2000 to US$41.54 billion, of which more than US$5 billion was clothing exports, accounting for more than 10%. Not to mention, the conclusion of the Vietnam-EU Free Trade Agreement, which has been compared to the “highway connecting Vietnam and the EU”, will bring more opportunities to Vietnamese textile companies to explore overseas markets.
According to Vietnam’s goal, Vietnam’s textile industry exports will reach US$42.5 billion (approximately 294 billion yuan) in 2020. Under the halo of the Vietnam-EU Free Trade Agreement, this goal seems to be possible.
However, it cannot be ignored that Vietnam’s textile industry is highly dependent on China’s supply of production materials. Up to 60% of the raw and auxiliary materials for the country’s textile industry come from China, especially clothing raw and auxiliary materials, Yarns, fabrics, etc. are mainly imported from China. Some voices pointed out that without the blessing of Chinese raw materials, Vietnam’s manufacturing would be just a name in vain. </p
