Taiwanese invest in garment, textile sectors in VN to take advantage of trade deals

Saturday, Sep 26, 2020 08:31

Viet Nam is an attractive destination for Taiwanese garment-textile investors. — VNA/VNS Photo

Taiwanese enterprises have been increasingly investing in the garment and textile and footwear industries in recent years to capitalise on opportunities provided by free trade agreements that Viet Nam has signed.

Viet Nam has signed trade deals with a number of countries and blocs resulting in import tax cuts and waivers in those markets.

Wang Wen-yuan, chairman of Taiwan’s Chinese National Federation of Industries, said Viet Nam is an investment destination Taiwan targets in its development strategy, adding that it wants to invest in garment-textile, footwear and supporting industries.

Typically, Taiwanese investors invest in the country's key southern region due to advantages pertaining to the market and supporting industries

The Southern Key Economic Region comprising HCM City and the provinces of Binh Duong and Dong Nai has received FDI from Taiwanese firms in the textile and footwear sectors.

The Hung Nghiep Formosa Dong Nai Textile Limited Company was incorporated in 2001 and has investment of US$1.6 billion.

Viet Nam offers affordable, skilled labour and benefits from its FTAs, according to the company.

Polytex Far Eastern Viet Nam has a 99ha plant to manufacture feedstock like cotton and polyester yarn in Binh Duong's Bau Bang Industrial Zone.

Over $274 million has been invested in its first phase, and the total registered investment is $760 million.

Another Taiwanese giant, Tainan Spinning Company Ltd., has increased its investment in its Long Thai Tu Spinning Factory at the Long Khanh Industrial Zone in Dong Nai to $100 million.

The EU-Viet Nam Free Trade Agreement (EVFTA) that took effect on August 1 reduces import taxes on Viet Nam's garment exports by more than 70 percentage points.

Vietnamese footwear and textile and apparel enterprises will benefit significantly from the EVFTA because of the tariff cuts, according to Bao Viet Securities Joint Stock Company.

With most other countries that export textiles and garments to the EU not having a trade deal with the bloc, the EVFTA is a great opportunity for Viet Nam if companies meet origin requirements, it added. — VNS

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