According to Vietnam Leather, Footwear and Handbag Association (LEFASO), it is expected that in 2019, total export turnover of footwear could reach over $21 billion, of which Binh Duong would contribute 10%.
To focus on technology innovation
According to experts, the Chinese economy is shifting towards deep market penetration strategy with preferential policies to high-tech industries. The fields that are no longer favored by China are textiles and footwear... This trend began in 2010, when big leather and footwear brands such as Adidas, Nike… that had invested in China, moved to Vietnam, Indonesia...
Production activities at Dong Hung Leather and Footwear Company.
In fact, there are currently more than 40% of shoe orders in the world by Adidas, Nike... originating from Vietnam. This trend will continue in Southeast Asian countries in general, Vietnam in particular, while the US-China trade war has not ended.
In the South, Ho Chi Minh City, Dong Nai and Binh Duong are areas that gather many large leather and footwear exporting enterprises. In Binh Duong, in 2018, many foreign enterprises invested in fields of textile, garment and footwear... However, domestic footwear enterprises still have many weaknesses, now FDI sector accounts for more than 80% export value of leather footwear - handbags. According to experts, without technology, labor productivity improvement, actively seeking markets, domestic enterprises could lose this game.
To strengthen connections and links
In 2018, Vietnam gained high turnover rate in some markets, like the US (up over 10%), China, Korea, Japan (up over 20%). Among these markets, the US accounted for more than 35% Vietnam's export value of leather footwear - handbags. However, the fact that the US has not joined CPTPP also more or less affected the domestic footwear industry.
However, when CPTPP takes effect, 78% Vietnam's footwear export turnover to Canada will be entitled to 0% tax rate or a 75% reduction compared to the current tax rate. Particularly to the domestic leather and footwear industry, Japan pledged to reduce the tax rate gradually and will have eliminated import tax in the 16th year, since the agreement comes into effect...
According to Nguyen Quang Vu, Chairman of Binh Duong Leather and Footwear Association, the footwear industry is having an opportunity to receive great volume of production orders. However, well-known foreign brands seem to create a playground for only large-scale producers, while small and medium-sized enterprises in the country would not have the opportunity to participate. Therefore, domestic leather and footwear enterprises need to connect and cooperate together share responsibilities to rise up and have a firm foothold in the market.
Reported by Xuan Vi – Translated by Ngoc Huynh
