Vietnam’s garment exports are set to rise 14.8 per cent this year. Garment exports to the United States rose 12 per cent in the January-October period while exports to China surged 40 per cent. US retailers are diversifying their product sourcing to keep costs under control amid an escalating trade dispute with China.

Vietnam is home to over 6,000 textile and garment factories which employ around three million people and these figures are likely to grow, thanks to a plethora of Vietnamese free trade agreements. Vietnam has signed around a dozen free trade agreements that will remove or reduce taxes on several imports and exports. Among these are the CPTPP, EU-Vietnam FTA and Asean-Hong Kong FTA.

Foreign investors have come into Vietnam’s garment and textile production in the first eight months of this year. Most investors are from Japan, South Korea, Taiwan and China, and they have been upping their investment in Vietnam for years. It already attracts the highest consistent growth rates of foreign direct investment among Asean nations.

Vietnam could be one of the major beneficiaries of the escalating US-China trade spat. The country will be the prime beneficiary of increased cross-border investment in the Asia Pacific. The country has had consistent positive growth over recent years.