FW
In the first nine months of the current year, Vietnam’s footwear exports increased by 12.5 per cent Y-o-Y to $16.53 billion, shows data from the General Statistics Office.
With this achievement, footwear also become one of top five export categories for Vietnam and one of just seven goods to surpass the $10 billion mark in exports.
This rise in Vietnam’s footwear exports is being driven by a broader recovery in its manufacturing sectors, particularly textiles and garments. Ahead of the peak production season at the end of the year, the country is experiencing a rising demand from both domestic and international markets.
However, despite these positive trends, severe labor shortages continue to challenge the industry’s growth, says PhanThiThanhXuan, Vice President and General Secretary, Vietnam Leather, Footwear, and Handbag Association. There is an urgent need for skilled workforce in labor-intensive sectors like textiles and footwear as the current shortfall continues to hinder production and the industry capability of meeting growing demand, he adds.
Noting the double-digit growth rate in the leather and footwear industry, Xuan says, the sector is on track to achieve its ambitious target of $27 billion in export revenue by 20240-end.
Throughout 2024, Vietnam’s footwear exports continued to grow in key international markets. In addition to labor shortages, the industry is also addressing supply chain risks, particularly in sourcing raw materials. At a recent event focused on the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), Xuan proposed establishing a raw material trading center to the Ministry of Industry and Trade.
This initiative will help reduce Vietnam’s dependence on imported raw materials, which currently account for 65 per cent of production costs, by enhancing the country’s ability to source essential resources for global export demands, Xuan said. The proposal could streamline production, improve order fulfillment, and also accelerate Vietnam's vision to elevate the fashion industry to $100 billion by 2030, he added.
Modefabriek co-founders Lucel van den Hoeven and Rick van Rijthoven have announced a fresh B2B event for men’s fashion, set to take place on January 26-27, 2025, at Taets Art and Event Park, Amsterdam. This industrial venue will host an exciting meeting of brands and retailers, aiming to foster inspiration and innovation in the ever-evolving market.
Coinciding with Modefabriek, the event will feature a carefully curated selection of brands and programs emphasizing quality and authenticity. The founders promise a ‘raw and pure’ experience, catering to industry needs with a no-frills approach and a new team. The event's name is yet to be revealed, but it promises to bring a fresh perspective to the fashion calendar.
The inaugural Vietnam International Trade Fair for Apparel, Textiles, and Textile Technologies (VIATT) concluded successfully on 1 March 2024. The three-day event, supported by TEXPROCIL, attracted 17,262 visitors from 55 countries and regions. A total of 409 exhibitors from 17 countries showcased products spanning the entire textile value chain.
Vietnam’s rapidly growing garment manufacturing sector has made it a key player in the global textile market, complementing China. Favorable trade conditions allow for tax-free or reduced-tax exports to Europe and the UK, further boosting Vietnam's role as a textile hub. Exhibitors met with buyers from the US, Europe, and Asia, including representatives from Chinese, Japanese, Korean, and Thai brands.
Looking ahead, VIATT 2025 will take place from 26 to 28 February at the Saigon Exhibition and Convention Center in Ho Chi Minh City. The fair is expected to draw over 500 exhibitors and 20,000 visitors, with a 15,000 square meter exhibit space. The event will showcase a wide range of textile products and technologies, facilitating trade across Southeast Asia and beyond.
The Organising Committee of Vietnam International Fashion Week has announced the dates for the Fall/Winter 2024 edition of the event.
To be held in Ha Noi from June 13-16 with the theme #FashionEvolution (New steps in fashion), the event will promote innovation and creativity, opening up new perspectives for the Vietnamese fashion industry.
The tradeshow will commence with the launch of a collection by designer Do Manh Cuong embodying the spirit of innovation in fashion. Known for his dynamic collections and impact on both domestic and global fashion, Do Manh Cuong is a key figure in Vietnam’s fashion industry. His recent brand relaunch reflects a focus on rejuvenating women’s fashion, targeting young, dynamic, and individualistic customers. His ‘turning point’ aligns with a global trend, as many major fashion houses have been refreshing their brands in recent years.
Following the success of the Spring Summer 2024 edition, which celebrated a decade of fashion, the Autumn/Winter 2024 editionof Vietnam Fashion Weekwill focus on the theme of #FashionEvolution, marking a transformation in the industry.
The event will include various sideline activities along with fashion shows. It will organise a fashion week for model selection from Nov 01-03 at The Garden Shopping Center. The event will give aspiring models an opportunity to showcase their talent and perform in live shows alongside designers.
Furthermore, a seminar on ‘Consumer Trends 2026’ will be organised in collaboration with trend forecasting giant WGSN. Scheduled for Nov 11, 2024 at the Lotte Westlake Hanoi Hotel, the seminar will provide strategic insights for fashion brands, helping them adapt to upcoming consumer trends. This seminar is expected to be highly valuable for industry insiders looking to navigate the future of fashion.
Shima Seiki launches its latest range of Whole garment knitting machines at ITMA Asia + CITME 2024 in Shanghai. The also included the company’s upgraded SWG-XR model which offers high-quality and stable all-needle knitting for various Whole garment products.
Featuring Shima’s unique Slide Needle on four needle beds, a spring-type moveable sinker system, and a lightweight carriage, the SWG-XR delivers efficient knitting of 18-gauge fabrics, with the SWG-XR124 model boasting a 49-inch knitting width and new user interface for enhanced connectivity.
The SWG-XR124 is also equipped with i-DYCS intelligent Digital Yarn Changer System, which supports up to 44 colors per garment, surpassing previous records. Additionally, the machine includes the i-FiKnit Finishing Knit option, which automatically cuts and knots edge yarns during color changes, reducing post-production labor and supporting sustainability goals.
For larger items, Shima Seiki displayed the SWG-XR144, with a 55.6-inch knitting width, capable of producing high-quality men’s pullovers. The compact SWG041N2 model, ideal for smaller items like gloves and socks, was also showcased, alongside proprietary programming for the sock industry.
Shima also introduced the N.SVR183 Whole garment machine, which now supports finer 24-gauge fabrics, offering flexibility for entry-level production. The N.SVR122, a benchmark in computerised shaping technology, was presented as a prototype capable of producing ultra-fine gauge fabrics up to 29 gauge.
In addition, Shima Seiki highlighted its SDS-ONE APEX4 3D design system and APEXFiz subscription-based software. These tools support virtual sampling, reducing waste and costs by enabling accurate digital prototypes. The new AI-powered knit generator creates knitwear images based on archival data, streamlining the design process. Shima’s yarn bank service further enhances the supply chain by allowing designers to source yarn digitally, ensuring seamless transitions from design to production.
A sourcing hub for innovative textiles, the Taipei Innovative Textile Application Show (TITAS), kicked off on Oct 15, 2024 at the Nangang Exhibition Center with eco-friendly and functional fabrics on display.
The show was inaugurated by Hsiao Bi-khim, Vice President, who stated, the textile industry has been the driving force of Taiwan's economic progress over the years.
The three-day show aims to showcase products using low-carbon fabrics, with a textile and fabric suppliers, including Far Eastern New Century, Formosa Plastics Group, Lealea Group, Nan Pao Resins Chemical and New Fibers Textile, showcasing various green fiber and textile products.
Hsu Min-hsien, CEO, Nan Pao Resins Chemical, said, the company plans to showcase a special sweat-resistant fabric with soft touch and made up of 53 percent biomaterial content. James Kuo, Chairman, Lealea Group and Taiwan Textile Federation added, the show is one of the most important annual events of the domestic textile industry.
This year, the show will host 385 manufacturers,including 75 exhibitors from oveseas, signaling the recognition earned by the event in the international market.
Over 70 international brands are likely to participate in private meetings with local manufacturers, along with visiting delegations from South Korea, Vietnam, India, France and other countries.
Recent Eurostat data reveals a significant downturn in the EU's apparel imports in the first seven months of 2024. The data shows a drop of 5.22 per cent compared to the same period last year highlighting a broader shift in the global apparel market. In the EU traditional suppliers like Bangladesh and China are facing headwinds while emerging players like Cambodia and Pakistan are gaining ground. Eurostat data reveals a dip in imports, shifting market shares, and a dynamic landscape influenced by economic factors, consumer preferences, and geopolitical considerations.
Declining imports and shifting market shares
Overall, EU apparel imports decreased by 5.22 per cent in the January-July 2024 period compared to the same period in 2023. This decline is reflected in the performance of major suppliers like China (-7.34 per cent), Turkey (-8.55 per cent), and Bangladesh (-4.84 per cent).
Table: EU apparel imports
|
Country |
Jan-July 2024 ($ bn |
Jan-July 2023 ($ bn) |
Change (%) |
|
China |
12.34 |
13.31 |
-7.34 |
|
Turkey |
5.89 |
6.44 |
-8.55 |
|
Bangladesh |
11.11 |
11.68 |
-4.84 |
|
India |
2.96 |
3.01 |
-1.93 |
|
Vietnam |
2.19 |
2.31 |
-5.07 |
|
Cambodia |
2.03 |
1.84 |
+10.36 |
|
Pakistan |
2.06 |
1.94 |
+6.32 |
|
Morocco |
1.73 |
1.67 |
+4.04 |
|
Sri Lanka |
0.77 |
0.8 |
-4.45 |
|
Indonesia |
0.58 |
0.64 |
-8.86 |
|
Total |
49.85 |
52.6 |
-5.22 |
Source: Eurostat
Key highlights
Economic slowdown: The overall decline in apparel imports reflects the broader economic slowdown in the EU, with rising inflation and energy costs squeezing consumer spending.
Shifting sourcing strategies: The contrasting fortunes of different suppliers suggest a shift in sourcing preferences. Cambodia and Pakistan, with their competitive labor costs and growing manufacturing capabilities, have registered significant growth. This could indicate a move by EU buyers to diversify their supply chains and reduce reliance on traditional sources like China and Bangladesh.
Sustainability concerns: Consumers are increasingly conscious of the environmental and social impact of their fashion choices. This is driving demand for sustainable and ethically produced apparel, which could be benefiting countries with stronger environmental and labor regulations. Nearshoring trend: Rising transportation costs and geopolitical uncertainties are encouraging some EU brands to source closer to home, potentially benefiting countries like Turkey and Morocco.
Eurostat data reflects that despite a relatively moderate decline, Bangladesh faces challenges due to rising production costs, energy shortages, and shipment delays. These factors are eroding its competitiveness and could lead to further loss of market share. Addressing these issues, along with improving infrastructure and enhancing sustainability practices, will be crucial for Bangladesh to retain its position in the EU market.
Similarly, the decline in Chinese apparel imports is likely due to factors like, rising labor costs, trade tensions with the EU, and the emergence of competitive alternatives.
Future outlook
In coming years, the EU apparel import market is expected to remain dynamic and competitive. In fact, with economic uncertainty looming, price will remain a crucial factor in sourcing decisions. And a growing emphasis on sustainability and ethical production practices will reward suppliers who can demonstrate strong compliance and transparency. The trend towards nearshoring and diversification of sourcing locations is likely to continue. At the same time aautomation and digitalization in the apparel industry will play an increasingly important role in enhancing efficiency and competitiveness.
After a 10-month delay following the expiration of the previous policy on Dec 31, 2023, the Gujarat government has announced Textile Policy 2024 for the state. Thenew policy introduces key financial incentives that aim to revitalise the textile industry in Surat and across the state.
A major highlight of this policy is the introduction of a 25 per cent capital subsidy for the first time.The policy also reduces the interest subsidy from 5 per cent to 2 per cent. However, the Rs 1 per unit power subsidy has been extended to all textile units. The Gujarat Government also allocates funds worth Rs 1,107 crore to support approximately 5,592 textile units in Surat and other regions.
The capital subsidy offers substantial benefits to textile traders by covering a portion of their investment costs. For instance, if a textile entrepreneur invests Rs 100, the government will provide Rs 40 as a subsidy, reducing the burden of capital expenditure.
Surat has long been renowned for its thriving textile sector, particularly in sarees and dress materials, with products exported across India and internationally. However, despite this success, inadequate infrastructure remains a critical challenge. The city’s ability to scale up and compete globally is hindered by a lack of robust facilities, unlike countries such as China and Bangladesh.
Recognising this need for skilled labor in the city, the Southern Gujarat Chamber of Commerce and Industry (SGCCI) plans to launch a Skill Development Center to train workers in operating modern machinery and improving technical skills. This initiative will help local industrialists focus on garment production, a segment with vast growth potential for Surat’s market.
Bangladesh’s garments export to the US declined by 9.16 per cent Y-o-Y to $4.70 billion in the Jan-Aug’24 period as demand for apparels in the American markets contracted, as per data from the Office of Textiles and Apparel (OTEXA).
The combined apparel and textile (T&A) exports from Bangladesh to the US also lowered by 8.98 per cent Y-o-Y to $4.84 billion during the Jan-Aug’24 period.
OTEXA has recently released its data on apparel and textile import from different countries. The organisation analyses industry data besides being involved in the development of US trade policy. It also participates in trade negotiations and promotion to address trade barriers.
The World Trade Organization (WTO) has released its updated ‘Global Trade Outlook and Statistics’ report, underlining a cautious optimism for global trade. While merchandise trade is expected to rebound in 2024 and 2025, lingering economic and geopolitical uncertainties continue to pose challenges. The WTO has revised its forecast for world merchandise trade growth upwards to 2.7 per cent for 2024, a slight increase from the 2.6 per cent predicted in April. This growth is expected to continue into 2025, albeit at a slightly slower pace of 3.0 per cent.
Report highlights
Modest growth: Global merchandise trade volume is expected to grow by 2.7 per cent in 2024, a slight increase from the previous estimate of 2.6 per cent. This rebound follows a 1.1 per cent drop in 2023, attributed to high inflation and rising interest rates. Growth is projected to further strengthen to 3 per cent in 2025.
Regional variation: Asia is expected to lead the growth in export volumes with a 7.4 per cent increase in 2024, while Europe is projected to see decline of 1.4 per cent. Least developed countries (LDCs) are forecast to see a modest 1.8 per cent growth in exports.
Services trade resilience: Services trade has shown a more robust performance, growing by 8 per cent in the first quarter of 2024. Travel services were a key driver, exhibiting a strong 19 per cent growth in the same period.
Easing inflation: The report notes that inflation has moderated sufficiently by mid-2024, allowing central banks to begin cutting interest rates. This is expected to provide some support to trade growth
Geopolitical risks remain: The WTO highlights that rising geopolitical tensions and increased economic policy uncertainty could negatively impact trade prospects.
Focus on textile and apparel sector
The textile and apparel sector, a significant contributor to global trade, is experiencing mixed recovery. It suggests demand for textiles and apparel is shifting, with increased demand for sustainable and ethically produced products. The sector continues to grapple with supply chain disruptions, with companies seeking to diversify sourcing and build greater resilience. Also, Asia remains the dominant player in textile and apparel production and exports. However, some production is shifting to other regions, including Africa and South America, as companies seek to reduce costs and diversify risks. And online sales of textiles and apparel continue to expand rapidly, creating new opportunities for businesses of all sizes. This trend is particularly pronounced in emerging markets with growing internet penetration.
Table: Regional trade growth projections for 2024
|
Region |
Export volume growth (%) |
Import volume growth (%) |
|
Asia |
7.4 |
6.5 |
|
North America |
2.1 |
1.9 |
|
South and Central America |
1.5 |
1.7 |
|
Europe |
-1.4 |
-2.3 |
|
Africa |
0.8 |
0.9 |
|
LDCs |
1.8 |
2.1 |
The report indicates developed economies facing slowdown and high inflation, are expected to see moderate trade growth. Driven by strong domestic demand and rising incomes, developing economies are likely to experience more robust trade growth. LDCs or least developed economies while facing significant challenges are expected to benefit from increased trade opportunities, particularly in sectors like textiles and apparel.
The WTO report also highlights several challenges and risks to the global trade. The ongoing geopolitical conflicts and trade disputes create uncertainty and can disrupt supply chains. At the same time, unpredictable economic policies and potential trade restrictions can negatively impact investor confidence and trade flows. And extreme weather events and climate-related disruptions could pose a threat to global trade.
