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Vietnam’s textile sector focus on sustainability issues

Within Vietnam there is a growing concern that FDI, including the textile sector, needs to be tempered with efforts to deter unlimited environmental pollution. Public opinion has been marred by mass fish deaths off Vietnam’s central coast, with environmentalists blaming a toxic leak from a steel mill in April receiving investment from Taiwan, a key investor in Vietnam’s textile sector.

As the garment and textile sectors are significant contributors to Vietnam’s economy and will become even more so under pending free-trade agreements, ‘manufacturing sustainability’ is especially being discussed by non-governmental organisations (NGOs) promoting development in this key emerging market.

The International Finance Corporation (IFC) and global apparel and footwear company VF Corporation and consumer products retailer Target Corporation, recently launched a program to improve resource efficiency at their supplier factories in Vietnam. In the first phase, energy and water-efficiency assessments will be conducted at around 30 factories within the first year; subsequent phases will then evaluate opportunities for use of clean energy to meet the captive power needs of the textile supply chain. The IFC will help facilitate the programme’s financing through its partner banks in Vietnam.

Independent observers, however, wonder what level of uptake IFC is going to get from the factories, given that improving energy efficiency is hardly going to be top of most garment makers’ lists of priorities for borrowing money.