Viet Nam's garment exports to the UK increased in August as Vietnamese enterprises take advantage of the UK-Viet Nam Free Trade Agreement (UKVFTA) to expand their presence in this market.
The latest data of the General Department of Vietnam Customs shows Viet Nam shipped US$92.4 million worth of garment products to the UK in August, up 3 per cent month-on-month and up 88.6 per cent over the same month in 2021.
Ending August, the country's garment export reached $560.4 million, registering a year-on-year growth of 45 per cent.
The figure for the whole industry was $26.3 billion in the past eight months, up 24.3 per cent over the same period of last year.
According to Vietnam Textile and Apparel Association's vice chairman Truong Van Cam, despite challenges in some main exporting markets, Viet Nam's textile and garment industry is set to earn $45 billion in exports in 2022 compared to $40.3 billion last year.
Viet Nam is currently the world's third largest exporter in this sector. Its main markets include the US, the Republic of Korea, Japan and Europe.
Cam said the industry is facing many difficulties at the end of this year, including steep fall in export orders due to soaring inflation in major markets and rising input cost. China's strict pandemic control, where more than 50 per cent of raw materials for the Vietnamese textile and garments are sourced, has pushed up input costs.
In addition, the EU introduced new regulations on the textile industry, including replacement rates, green products and switching from fast fashion to sustainable fashion, which makes it harder for Vietnamese apparel products enter this region.
In this context, the UK is emerging as a promising market. Research by Kantar from the Guardian shows that despite rising living costs, UK shoppers are spending more on clothing, defying expectations of a slowdown in non-essential products.
Kantar's data showed Brits are spending almost a fifth more on clothing than last year, taking the value 1 per cent ahead of the pre-pandemic figure.
The UK is among the top 10 largest markets for Viet Nam's garment export, with a value of around $600 million in 2021, accounting for less than 2 per cent of Viet Nam's total export value. However, with the advantage of lower tariffs thanks to the UKVFTA, Viet Nam has a big chance to expand its market share.
Under UKVFTA, about 42.5 per cent of Vietnamese textile and garment exports will be liberalised at entry into force, while some garment products will see tariffs eliminated after six years.
However, according to market insiders, Vietnamese exporters should strictly comply with the UK's requirements on the origin of products and other technical barriers such as input materials, labour and environment. — VNS