Export revenue of bags and suitcases was 1.92 billion USD in 2013, up by 26 percent year-on-year.
Local manufacturers are expecting better growth this year, with increasing global market demand prompting t he Vietnam Leather and Footwear Association (Lefaso) to forecast an export growth of 30 percent for this group in 2014.
According to Lefaso, many foreign enterprises are seeking providers of finished products, and some manufacturing factories are even moving to Vietnam from China and Indonesia to gain access to lower tariffs and a relatively better-skilled workforce.
To benefit from preferential tariffs under various free trade agreements and the Trans-Pacific Partnership Agreement, several foreign companies of ancillary industries have also invested in Vietnam.
Nguyen Duc Thuan, Lefaso chairman, told VnEconomy that eight out of the 10 global leading brands had expressed interest in moving their orders to the country.
The movement will create a great opportunity for the local firms to expand production. Local firms would strive to increase investment, expand production scales, and improve the quality of their products to compete with foreign invested firms in Vietnam.
Businesses primarily use domestic leather to make student handbags and backpacks, whereas higher quality materials are imported to make luxury handbags.
Thai Binh Shoes is a pioneer in the manufacturing of luxury handbags for world-famous brand names, including Coach of the US.
The largest importers of made-in-Vietnam bags and suitcases are from North America (44 percent), the European Union (28 percent), and Asia (21 percent).
In the past, foreign investors dominated the handbag export market. However, domestic businesses have gotten into it over the past two years and set their sights on becoming suppliers to world-famous brands.
Bags and suitcases were part of the leather and footwear exports worth a total of 10.3 billion USD last year, an increase of 18 percent over the value of exports in 2012.
The export value of footwear products was estimated at 8.4 billion USD in 2013, which is 15 percent higher than the previous year, while the export value of handbags surged 26 percent from the previous year to 1.9 billion USD, according to Lefaso.
As the industry increased the use of local inputs for production, it only paid 3.7 billion USD for raw material imports last year, which widened the trade surplus to 6.6 billion USD, noted Thuan.
VNA
