Vietnam's small and medium apparel enterprises struggled to survive in the first quarter of 2016. Many of them suspended production as their customers shifted orders to Myanmar and Laos to enjoy lower prices.

Vietnam exported $27.4 billion worth of apparel last year and over $8 billion in this year's first four months, up six per cent against the same period a year earlier. But despite rising shipments, the industry is coping with a slew of challenges. While apparel products of Myanmar and Laos enjoy special tariffs for exports to Europe and the US, Vietnamese firms have to wait until 2018 to make use of preferential tariffs to export products to these two major markets when the new free trade agreements with them take effect.

Additionally, apparel enterprises have become exhausted by so many inspections by customs, taxation, labor, environment and food safety authorities, with up to three or four inspection teams a quarter.

Vietnam’s apparel exports exceeded $27 billion last year against a target of $20 billion for 2020. That means the target for 2020 needs to be revised. In addition the country’s industrial parks need to be developed to facilitate management and wastewater treatment.