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TEXTILE AND GARMENT INDUSTRY IN VIETNAM
(In trillions of VND at 1994 price)
 | 1990 | 1995 | 1996 | 1997 |
| 1. Gross industrial output | 22,978 | 43,521 | 48,124 | 53,343 |
| Percentage change -% | 100.0 | 189.4 | 209.4 | 232.1 |
| 2. Gross output of textile -garment industry | 2,347 | 4,437 | 4,778 | 5,362 |
| Percentage change -% | 100.0 | 189.0 | 190.8 | 228.5 |
| Ratio in the industrial output -% | 10.2 | 10.2 | 9.9 | 10.1 |
| 3. Gross output of textile | 1,712 | 2,412 | 2,414 | 2,527 |
| Percentage change -% | 100.0 | 140.9 | 141.0 | 174.6 |
| Ratio in the industrial output -% | 72.9 | 54.4 | 50.5 | 47.1 |
| 4. Gross output of garment | 635 | 2,025 | 2,364 | 2,835 |
| Percentage change -% | 100.0 | 318.9 | 372.3 | 446.5 |
| Ratio in the industrial output -% | 27.1 | 45.6 | 49.5 | 52.9 |
Source: GSO
¡@¡@The data of table 2 indicate furthermore that fiber production is increasing slowly, fabric production is increasing unevenly, garment production is growing steady.
Table 2. Textile and garment production 1991 - 1997
| Items | 91 | 92 | 93 | 94 | 95 | 96 | 97 |
| Physical production data | | | | | | | |
| Fiber (000 tons) | 40 | 44 | 38 | 44 | 50 | 57 | |
| Fabric (mil m) | 180 | 272 | 215 | 228 | 221 | 281 | |
| Clothing (mil pieces) | 106 | 104 | 91 | 121 | 127 | 200 | |
| Gross Output (bill dong ¡V current prices) | | | | | | | |
| Textiles | 2,859 | 3,800 | 5,278 | 6,853 | 9,361 | 10,518 | 11,317 |
| Garments | 585 | 700 | 1,350 | 2,345 | 3,411 | 4,270 | 5,125 |
Source: GSO, Ministry of industry.
¡@¡@Despite of a relatively high rate of growth and relatively large volume of items, Vietnam textile and garment industry still does not satisfy with the domestic demand. Over 80% of the wide range of fabrics available on the local market currently are imported products. Vietnam can produce just 3,400 tones of cotton per year, meeting only 5% of the local textile demand. Synthetic fibers and yarns are entirely imported, and cotton fibers for producing knitwear are also imported in huge volume each year. In addition, 100% of dyeing substances and about 80% of chemicals are still imported.
2. Main types of textiles and garments of the industry
¡@¡@As a result of the economic reform in the market economy, textiles and garments structure has changed. There are many products that have never been produced before, now become popular in most of enterprises. Here we describe some types of main textiles and garments produced in Vietnam, such as fiber, products of shuttle weaving, knitted weaving, garment products and accessories.
Fiber:
¡@¡@During the decade of 80s, fiber products mainly were roughly brushed cotton with index of Nm 12, 14, 20-34, 36, 39, 54, 71, most of them reached 75% of Uster internationally statistical line or below. Carefully brushed cotton accounted only for 3% of total output of the whole industry. Polyester-mixed fibers (67/33, 65/35) with dominant index of Nm 67, 76 hold only 16-20% of total output of the whole industry.
¡@¡@OE fiber though occupied 2.3% of total output of the whole industry, they were made mainly of wasted or low quality materials. Fibers for industrial thread making used to reach 1.16%.
Since 1991, fiber products are more diversified and various: such as carefully brushed cotton fiber with high quality of Nm 85-120; Polyester mixed cotton with different proportion of mixture; 100% Polyester fiber; Cotton/Visco; Cotton/ Acrylic; Wool/ Acrylic, Fiber for socks, underwear making
Shuttle weaving Products:
100% cotton products: shuttle weaving products made of carefully brushed single fiber with high index of quality have been used to produce shirts for export (for example, single colored or checked, color striped).
¡@¡@Products made of thick cotton by using techniques for polishing and preventing from mechanic elasticity such as khaki cloth, drills now have been exporting to European and Japan markets.
¡@¡@Products of 100% cotton Denim were recovered with innovated technology and have been producing in Phong Phu Textile Company.
Production of fur - cotton towel for export has rapid growth with many kinds of size, for example eating towel, bath towel, face towel with various ways in weaving.
¡@¡@Some regions, such as Hoa Xa (Ha Tay), Loi Thanh (Nam Dinh) still maintain to produce mosquito net made of cotton with relatively large amount. Because this mosquito net is suitable for rural areas and highlands.
Products of mixed fibers (mainly cotton ¡V polyester mixed fiber): There are various kinds of shuttle weaving products, such as products made of mixed fiber with different proportion of mixture: 45/55, 65/35, 83/17, single colored Kate made of fiber with index Nm 76, different kinds of checked and striped made of single fiber with index Nm 76 or striped fiber with index 76/2, coarse cloth made of 76/2 fiber, and some kinds of thick mixed cloth (for example Gabardine, Khaki, Simili). These products are mainly used domestically, especially meeting demand of Ministry of Internal Affairs and Ministry of Defense.
¡@¡@Technique for mixing lamp feather and polyester for making polyester mixed woolen have been applying since 1995, that opens new stage to wool mixed Tissue production in the coming years.
¡@¡@Besides, many products of cotton mixed Petex or cotton mixed Pe/Co/ Petex have been producing in enterprises of the industry. Although their output is not large, they already meet some mode requirements of domestic markets.
Products made of 100% synthetic fibers: Thanks to many newly invested equipment, such as fiber twisting equipment with high level of twisting, comfit equipment, weight reducing equipment, a lot of thin products as well as silk-imitated thick products or wool imitated products have been producing. They are very fitted to tropical climate and diversify products of Vietnamese dress and home wearing clothes.
¡@¡@Although textile sector have reached some considerable achievements in its development and increase of quality during last years, there are still have some big constraints which have to overcome in the coming years:
- The proportion of effective products in total output is low. This slows down the return of investment capital and hence prolong period for loan payment.
- The textile sector still not substitutes considerably imported materials for garment production.
- Research activities for new products are still not encouraged and there is lack of autonomy in marketing and capital shortage for research.
Knitting Products:
¡@¡@Knitting products are very diversified and have been consumed extensively. Vietnam¡¦s knitting industry has just been interested in production by using rounded weaving machines. Thus, knitting products are mainly Polo-shirt, T-shirt made of cotton and Pe/Co fibers.
¡@¡@Accompanying with the development and increase of demand for both domestic and international markets, Vietnam still imports many categories of products such as floor - covering carpet, wall-sticking paper, chair - covering cloths, cloths for road construction, filter and women's underwear with high quality which can not be produced by domestic producers.
¡@¡@Exported knitting products made by Pe/Co fibers occupy 75-80% of total knitting output and its export price is still low of US$ 2.5-3.5 / piece in average. However, export demand for high quality products is considerable with price of US$ 10/ piece for moderate quality and US$ 20 / piece for high quality. These products are made mainly from carefully brushed cotton with feather burning, polishing and anti - elasticity.
¡@¡@Most of previously popular products such as shirts without sleeve and collar and shirt with laced collar have decreased considerably since their costs are high but prices are low. If the industry does not innovate equipment and technology, then currently exporting products would fall into the same situation. For example Pull shirt is made of Pe/Co fiber over five years and has no change in technology as follows:
- Pe/Co with index Nm 76/1, Nm 102/2.
- Weaving type of crocodile on Single or Interlock machines.
- High pressure dying technology and cutting and sewing technology which is similar to Polo ¡V Shirt and T ¡V Shirt.
Garment products and accessories:
¡@¡@Garment products are various and diversified, fashionable. Beside, they have both international and traditional features. When economy grows, living condition increases, demand for garment products is more diversified and required.
¡@¡@At present, Vietnam¡¦s garment products that enterprises of the industry are providing for domestic market and export are following:
- Underwear for men and for women.
- Products for home use: sleepwear, pillow cover, blanket.
- Products for daily life: shirt, trousers, skirts...
- Sportswear: sweater, Jean.
- Fashion wear.
- Special products: military uniform, work clothes.
Vietnam¡¦s garment industry has made great progress, shifting from production of work clothes for export, simple products such as: blanket, pillow cover, sleep wear, pupil uniform to doing high-ranking categories accepted widely in domestic market as well as in the international market.
¡@¡@However, the garment enterprises lack modern specializing machines, thus require intensive labor. That lead to low productivity in comparison with other countries. Some high-ranking products, such as leather jacket still cannot be produced because of lack of specializing machines.
Accessories: Previously, the industry have produced only some low quality accessories such as: threads, button, lock chain, PE package, hard paper, bow. Nowadays, the industry has made some progresses by implementing technical innovation, joint venture with foreign partners, attracting foreign investment, etc. The industry now can produce cotton pieces to make warm clothes, threads, buttons, lock chain with high quality which are fully meeting requirements of export (for example: Phong Phu Total thread, Nha Trang lock chain, Viet Tien plastic button, Viet Khanh plastic button, Viet Phat sticking material, Viet Tien cotton piece, Minh Phung cotton piece _)
3. Export and import performance of the industry
¡@¡@Since the ¡§ doi moi¡¨ process got underway, Vietnam's garment and textile exports have grown strongly, illustrating once again the powerful connection between reform and export performance. The industry has successfully shifted from its traditional CMEA market to Western and Asian market after the collapse of the CMEA in early 1990s. Exports have risen from USD 43 million in 1988 to over USD 1.3 billion in 1996 (see Table 3). Garments have been the most important, its exports in the 1990s generally exceeding those of textiles. Nevertheless, textile exports have also grown, especially since 1991. The industry also ranks significantly in total export, in 1996 accounting for one ¡V fifth of the total and now become the second largest export category after petroleum. The textiles and garments are Vietnam¡¦s largest manufacturing export, accounting about 60% of the total manufacturing in the early stage of the export. As would be expected, this percentage is declining as the process of export diversification.
Table 3: Vietnam¡¦s textile and garment exports, 1985 ¡V 1998 (USD million)
Year | Textile(T) | Garment (G) | T+G | T+G as % of Total | T+G as % of Total Man. |
1985 | 6.5 | 21.1 | 27.5 | 7.9 | 55.0 |
1986 | 11.1 | 36.0 | 47.1 | 11.9 | 54.4 |
1987 | 13.3 | 27.4 | 40.6 | 9.1 | 57.1 |
1988 | 15.8 | 27.0 | 42.8 | 7.9 | 53.5 |
1989 | 25.1 | 68.1 | 93.1 | 8.4 | 56.1 |
1990 | 27.8 | 90.7 | 118.5 | 7.9 | 56.4 |
1991 | 29.4 | 142.9 | 172.3 | 9.9 | 61.8 |
1992 | 39.6 | 357.2 | 396.8 | 15.6 | 62.2 |
1993 | 61.7 | 521.0 | 582.7 | 17.8 | 52.9 |
1994 | 107.8 | 691.6 | 799.4 | 17.8 | 49.3 |
1995 | 147.8 | 878.8 | 1,026.6 | 18.2 | 45.5 |
1996 | 175.5 | 1,162.7 | 1,338.2 | 19.8 | 41.3 |
1997 | - | - | 1,349 | 15.5 | - |
1998 | - | - | 1351 | 14.5 | - |
Source: UNIDO and DSI, Vietnam economic News No. 6/1998, No. 4/1999.
¡@¡@The Asian crisis makes its negative impact on output as well as input of exported products of the industry. Vietnam has to compete with Southeast Asian countries whose currencies are substantially devalued. Because of the regional financial crisis, wages are dropping and Vietnam¡¦s competitiveness is weakening. There are frequent reports of orders being canceled, especially from Korea and Japan and of buyers demanding price cuts of up to 20% for subcontracted order in which imported inputs are provided to exporters. In 1998 Vietnam did well almost to maintain its 1997 export value (USD 1.35 billion), owning to decline in East Asian non ¡V quota export demand.
¡@¡@Vietnam is a large net importer of textile. Its net trade ratio has been high and consistently negative in the last 10 years. This is underlining the fact that textile has been and continuing to be a highly import ¡V intensive activity. The process of import substitution in textile, especially its more labor ¡V intensive components, has not proceeded further. The absence of this process in presumptive evidence of deep-seated inefficiencies in the textile sector.
¡@¡@By contrast, in garment strong export orientation has been maintained and the net trade ratio has been vertically constant throughout the 1990s. In part, of course, this reflects the country¡¦s restrictive trade regime, apart from the duty ¡V free policy for garment exporters. It should be noted that, these figures do not include the unknown very significant volume of garments illegally imported from China.
¡@¡@Combining textile and garment sectors, Vietnam emerges as net exporter. The net garment export only just exceed net textile import. Vietnam is clearly unusual in the comparison of its net trade ratios in textile and garment. By comparison, China, Indonesia and Thailand are all net exporters. All these countries have very high net trade ratio for garment. But the really feature of Vietnam is that its net textile and garment exports are too low compared to other in the comparison. There is nothing inherently desirable in high net trade ratio, but where they are not found in such labor ¡V intensive activities in which low income countries have a strong comparative advantage, serious domestic supply ¡V side obstacles must be presumed to be present. The fact that countries like China, Indonesia and Thailand have a sizable textile export industry suggests that in the right policy environment, Vietnam could also aim in this direction.
4. Ownership structure of the industry
¡@¡@The ownership shares of the industry reflects the legacy of its history as a state dominated centrally planned economy, and its transitional nature during reform process. A picture therefore emerges of an extremely high state share, a moderately high foreign presence and an under - developed domestic private sector. The SOEs have occupied a predominant position in the production and export of textile and garment. Although attempts are made to cut subsidies to SOEs and promote participation of non - SOEs, state sector still enjoy privileged access to land, capital, bail - out facilities and garment export quotas. As a result, a majority of production and export of textile and garment is recorded by SOEs. In 1996 for textile sector, the SOEs are dominating with about 60% of total production in 1996, while the non - state sector accounted for 24% and the foreign invested share was about 16%. In the garment sector, the foreign share is similar at 15%, while the non - state enterprises are relatively more important with 49% and SOEs accounted for 36%. According to the equitization programme of the government, up to 2000 year almost of SOEs in textile and garment industry will be equitized. This enterprises reform which enables the private firms to expand efficiently is one of the principal challenges facing the industry.
¡@¡@By the late 1997, there had been more than 40, 000 units operating in the field of textile and garment. The enterprises in the industry have been taken in 4 forms;
1. State owned enterprises include central and local SOEs. The number of Central textile SOEs which have controlled by the VINATEX is 30 including 3 mechanic enterprises. The central garment SOEs are 32 enterprises, among of that 22 enterprise controlled by VINATEX and 10 enterprises belonging to Defense Ministry, Ministry of Internal Affairs, Ministry of Trade, etc. The local SOEs have been assigned by the government to the people Committee of provinces and cities to manage. In the textile sector there are 24 local SOEs. The garment sector has 84 local SOEs. Beside that the garment sector also has 8 units controlled by the youth Union, woman Union...
Non - SOEs consist of cooperatives, private enterprises, private households. The textile sector has 227 cooperatives and private enterprises and about 10.000 private 1. households. In the garment sector there are 384 cooperative and private enterprises and about 30,000 private households.
2. Foreign invested firms consist of join venture enterprises and 100% foreign invested enterprises. The textile sector has 19 join venture enterprises and 40 enterprise with 100% of foreign investment. The garment sector has 29 joint venture enterprises and 53 enterprises with 100% of foreign investment.
¡@¡@In the period 1985 - 1995 the industry has increasing trend in the number of enterprises. Up to 1995 the total number of textile and garment enterprise had increased to 109,369, up by 139.7% and 44.2% compared to 1985 and 1990 respectively. The number of SOEs had gone up from 196 in 1985 to 215 units in 1995. The number of private enterprises grew by 11 times from 43 to 482. The number of private households had gone up from 74,083 to 108,430 (up by 46.4%), while the number of cooperatives went down by 84.1% to 242.
¡@¡@Even though the number of textile and garment enterprises went down in 1996, but from 1991 - 1996 the value of the textile and garment industry in both SOEs and non - SOEs increased. The growth rate of the industry in non - state sector was higher than that in the state sector. In the non ¡V state sector the growth rate of cooperatives has decreased, meanwhile the private enterprises have developed with a high annual rate.
¡@¡@Private enterprises are mainly medium and small. The organization of private enterprises is much simpler than SOEs: its principal operating units are functional divisions under the direct control of management or very often a owner. It may have a number of functional heads of units or in a small simple company, the owner may carry out most entrepreneurial functions and employ a very small number of full - time professionals, and periodically hire consultants to deal with special needs. In present condition, private enterprises adjust very quickly to sign contract with small volume, which become more popular in the international textile and garment manufacturing. However, in Vietnam private enterprise continues to face major obstacles to growth (to be presented in the following section).
¡@¡@On the other hand, the position of state sector is more strengthen through national and industry - wide coordination of largest state enterprise ¡V VINATEX (see table 4). VINATEX is leading corporation in garment and textile industry, which including 52 enterprises. Production output of VINATEX consists of large share of this industry. It estimates that VINATEX produces 80% of total fiber, 65% of fabric and 45% of garment product and export 40% of total export value of this industry.
Table 4: VINATEX Performance
(Unit: Million dong)
| 1994 | 1995 | 1996 | 1997 |
| 1. Capital | 1,459,849 | 1,529,222 | 1,693,398 | 1,775,508 |
1.1 Business capital
-Fixed capital
-Working capital | 791,286
668,563 | 658,123
671,099 | 1,031,872
661,526 | -
- |
1.2 State Fund
-From the budget
-Self-financed | 1,459,849
948,743
511,106 | 1,529,222
980,066
549,156 | 1,693,398
996,329
697,069 | -
-
- |
| 1.3 Bank loans | 1,033,635 | 1,394,600 | 1,515,401 | - |
| 1.4 Others loans | 280,000 | 340,060 | 345,000 | - |
| 2. Turnover | 3,366,074 | 4,559,187 | 4,830,504 | 5,464,600 |
3. Contribution to the
budget | 245,015 | 278,160 | 229,073 | 160,200 |
| 3.1 Depreciation | 83,899 | | | - |
| 3.2 Assets Tax | 43,291 | 40,115 | 45,053 | 16,115 |
| 3.3 Turnover tax | 71,851 | 86,761 | 86,903 | 90,978 |
| 3.4 Income tax | | | 915 | - |
| 3.5 Profit tax | 24,469 | 57,170 | 30,442 | 26,287 |
| 3.6 E/I tax | | | 36,410 | 12,545 |
| 3.7 Other | 22,505 | 55,406 | 30,155 | 14,275 |
| 4. Profit | 106,542 | 38,708 | 21,648 | 54,494 |
| Profit Rates (%) | 7.3 | 2.5 | 1.3 | 3.1 |
| 5. Outstanding Debt | 2,375,648 | 2,587,345 | 3,269,410 | 3,668,716 |
| 5.1 Foreign debt | | 340,604 | 345,000 | - |
| 5.2 To State | 78,466 | 81,858 | 30,015 | - |
5.3 To Banks
-Of which: Short term | 1,033,635
578,902 | 1,394,615
561,855 | 1,515,401
725,895 | -
- |
| 5.4 Other | 292,014 | 215,622 | 517,729 | - |
Overdue Debt
-Of which: Bad loans | | 406,078
23,688 | 544,122
20,830 | -
- |
Source: VINATEX
Almost all of large scale enterprises in textile and garment industry are SOEs. According to our estimates, all enterprises in textile and garment industry are operating below optimal scale economies. Thus the effectiveness has positive correlation with the scale of enterprises. Large scale enterprises can operate more effectively than medium and small scale enterprises. That why in the past period, in the industry enterprises, especially SOEs have been reinvested to increase capacity. The investment flowing into these enterprises indicates a greater tendency within the economy towards allocative efficiency. But it also suggests a continuation of investment hunger within the SOEs, depending on the relative softness of their budget constraints. It is clear that SOEs have advantage in technology. SOEs employed newer technology than private enterprises. Even though all enterprises in garment and textile industry claimed their first priority was to renovate technology. However private enterprises stated finance was the binding constraint to technical change in their enterprises.
On the other hand, SOEs also have constraints in management and organization as compared to private enterprises:
- The organization of SOEs reflects greater control feature and more complicated than that of private enterprises. The procedure of decision making has been taken slowly.
- SOEs seem to be substantial over ¡V staffing, as these SOEs have to comply with government employment regulations.
- SOEs seem to be less flexible in production organization.5. Industrial structure
Vietnam's garment and textile industry consists of 3 sectors: up - stream sector (fiber production), mid - stream sector (fabric production and dyeing) and down - stream sector (garment manufacturing).
Although the fabric sector is more capital - intensive than the garment sector, it is still fairly labor intensive. The fiber production is essentially capital intensive. Vietnam exposes comparative disadvantage in up - stream and some mid - stream sectors, since development of these sectors require large investment capital which is essentially lack in Vietnam. In fact, those sectors that produce fibers or fabric of high quality have not existed within domestic economy. If existed, these sectors just can produce textile products of low quality that are used for domestic consumption. In view of comparative theory, Vietnam should produce goods whose production uses intensively country's comparative advantage in supply of cheap and unskilled labor. The garment sector is very labor intensive and Vietnam has a strong comparative advantage in this sector.
It has been investigated that industrial linkage between down - stream and up - stream, mid - stream sector in Vietnam is very week. The mid - stream fabric industry has not been vertically well integrated with garment industry. The week linkage within garment and textile industry is constraint of expansion of the industry as well as export.
The textile and garment industry uses main materials such as cotton, synthetic fiber, woolen, filament and silk. At present Vietnam can produce cotton and silk, which meet only 10% of demand. In the period 1991 - 1996 weaving material production has achieved a notable result. However, as compared to the development potential and demand for textile and garment industry, the weaving material production is very modest. In Vietnam the potential of cotton production is fairly large. Vietnam can expand the areas under cotton cultivation.
The textile and garment industry has imported a big amount of cotton. In 1995, cotton prices suddenly increased from US$ 1.7 to US$ 2.6/kg and then fell to US$ 2.05/kg on average in the first months of the same year, having a negative impact on the domestic cotton and cloth market.
Products of fabric sector, mostly cotton and polyester mixed fabric, are materials of garment production for domestic market. It is recorded that fabric industry supplies about 10% of total input demand by garment sector, the remainder of 90% of materials for the garment production for export are imported from overseas. A significant part of imported material is brought in through subcontracting arrangement.
The garment production is mostly targeted at export markets through international subcontracting agreements between Vietnamese producers and foreign partners, where foreign partner generally provide designing and marketing functions as well as most of necessary materials. This is known in the trade as CMT(cut, make and trim). In this occasion the industry earns very low value added. Even though in the past the garment sector used to use 100% of fabric made by Vietnamese textile sector to produce products for export. However at that time Vietnamese producers produced work ¡V clothes, blankets only.
6. Production capacity and actual production of the industry
The production capacity have located in the 3 sectors: SOEs, non ¡V SOEs and foreign invested sector. It is importance to refer herein the concrete production capacity of fiber spinning, shuttle weaving, knitted wear, dyeing and garment and the actual production in the period 1991 ¡V 1996.
The production capacity of fiber spinning is concentrated in the SOEs. In the late 80s, the highest output of fiber spinning is 60,000 ton per year with average Nm index is 40. At present the production capacity is 72,000 ton per year with average Nm index is approximately 61.
The capacity of fabric weaving achieves 380 million meters annually. Beside weaving of towel, mosquito net weaving spreads along the country and in the all sectors of the economy.
The capacity of rounded knitted wear is 19,500 ton annually. In addition Vietnam can produce other types of knitted wear, such as curtain, knitted mosquito net, socks and woolen weaving with capacity of 4,000 ton per year.
The capacity of dyeing is equivalent to the capacity of weaving. Dyeing with high quality is concentrated in SOEs.
The capacity of garment is 275 million unit per year. The popular commodities such as shirt, pants, jacket work ¡V clothes are able to compared to those of the region and the world.
According to the statistical data of the FDI projects, up to 30 December, 1996 the production capacity of FDI in the industry when completed is as follows:
- PES fiber: 167,400 ton / year
- PES silk : 133,500 ton / year
- Fiber spinning: 89,300 ton / year
- Fabric : 420 million m / year
- Garment products: 106 million units / year
- Other: knitted wear, knitted mosquito net, towel, socks, woolen weaving.
As compared to production capacity, the actual production in the textile sector is low, especially actual production of fabric has achieved 60% only. The reason is that shifting from subsidy economy for former Socialist countries and domestic market following the purpose of ¡§ enough eating, durable wearing¡¨ to the market economy, many enterprises could not catch up the situation. Several large scale enterprises equipped with outdated equipment to produce the fabrics with narrow width, low quality and high cost could not be able to sell their products in the market and had to cut down the production or to close the enterprise for waiting of equipment renovation.
The actual production of the garment sector has achieved about 50%. The main reason is lack of market : Export market is not stable, passive, depending and big proportion of domestic market is occupied by legal and illegal imported goods. The other reason is week level of production organization and marketing in the market mechanism and week linkage of textile and garment sectors.
7. Equipment and technology situation of the industry
Equipment and technology situation of the industry defers from sector to sector. It will be considered in 5 sectors: Fiber spinning, shuttle weaving, knitted weaving, dyeing and printing and garment sectors
For the fiber spinning: In the late 80s the industry had 860,000 spindles and 2,000 spinning rotors without spindles belonging to 13 SOEs. The annual output at that time is 60,000 ton with average Nm index of 40. These spindles have been used for over 10 years. Thus shifting to the market economy, the industry had to replace and improve this equipment. As a result, by the year 1996 the industry has had 800,124 spindles and 3,520 rotors. Among of that 90,600 spindles are new, occupy 11.32%; 55,960 spindles replaced by West European second hand ones, hold 7.0%; 107,000 spindles have been upgraded, occupies 13.4%. The production capacity has increased to 72,000 ton per year. Average Nm index is 61.
By the 80s fiber spinning technology in Vietnam is backward with very low level of automation. A big proportion of fiber spinning production is based on the technology to produce fiber with low Nm index. Transferring into market economy the industry has some new production lines by using automatically assembling machines and microelectronics chip to control fiber quality. However the proportion of these fiber is low. Some enterprises demanded fiber of high quality still have to import.
For the shuttle weaving: The industry has 10,500 weaving machines (up to 1996). The newly imported machines account for 15%. The share of machine which can be restored is 45%. The remaining is in need of selling off.
Central SOEs has owned 7,973 units, among of that the number of modern weaving machines is 978 units, occupies 12.26%.
In the North the out of date - textile machines of about 5,000 units which made in China have imported from 1956, 1964, 1971. Operating for a long time, the number of machines being able to use is about 2,302 only. In the Central areas of the country the potential of textile equipment is very week in the quantity as well in the quality. In the South the old textile equipment mostly has imported from Japan, USA, Korea in the period 1960 ¡V 1974.
Weaving technology has a big change in the market economy. The industry has applied different technologies as follows:
- 100% cotton weaving technology to produce fabric for work clothes, cotton towel, mosquito net;
- Synthetic weaving technology to produce silk - imitated fabric, wool - imitated fabric, product made of Microfiber;
- Cotton - polyester mixed weaving technology;
- Silk and woolen technology;
- Denim weaving technology is initially applied in Jumbo - Saigon joint venture Company, Phong Phu Textile Company.
For knitted weaving: the industry has 2 kinds of equipment: 1, Knitted weaving equipment imported before 1986. Almost all of that were imported from China, Czechoslovakia and East Germany. The technology of that was out of dated at that time. At present this equipment was liquidated or transferred to localities. 2, Knitted weaving equipment imported after 1996. This equipment was imported mostly from Japan, Korea, Taiwan, Germany. 30% of that are machines of new generation, some of those are controlled by computer. The remaining are belonging to old, out of date generation. Because of low quality of cotton fiber, almost all enterprises have chosen production plan using Pe/Co fiber. Up to 1994 some enterprises have imported straight - knitted machines. However, using these machines Vietnam producers have made mosquito net, valise fabric only, but do not interested in decorated cloth, carpet, cloth for construction, cloth for automobile industry.
For dyeing and printing sector: All dyeing, printing and finishing equipment were imported from outside and belong to SOEs. At present, 35% of dyeing and printing equipment in the industry have imported from 1986 (about 400 units). All of them are equipment of A2, A3 generation and still operating well. 30% of dyeing and printing equipment have imported in the period 1970 ¡V 1985. This equipment is in need of repair for further use. The remaining were imported in the period 1959 ¡V 1969. This equipment should be scrapped gradually.
For garment sector: At the beginning, the industry used sewing machines driving by leg. And then the industry gradually replaced by industrial sewing machines made by china, Former Soviet Union, West Germany, Hungary and Japan. From 1991 up to now the industry has invested in technology renovation in order to expand production and improve quality of products to meet requirements of international market. The almost all of sewing machines are modern ones with high speed of 4,000 ¡V 5,000 circles/ minute. Some enterprises such as Garment Company No 10, Viet Tien Garment Company are equipped by the sewing machines with some automatic functions. The industry also has bought numerous specialized machines. Some enterprises have invested in synchronous production line by using many specialized machines to produce one category such as shirts, jeans, etc. Almost all of garment enterprises use steam ironing system.
From 1991 technology in garment sector has been renovated. Production line has been set up with medium and small scale, consisting of 25 ¡V 26 sewing machines with 34 ¡V 38 laborers. Thus garment enterprises capable handle production being stable within 2 days when product style changes. Some enterprises have used new technology, computer in some production functions. These changes reflect new competitiveness of garment producers on quick responses to changing demand.
Finishing stage such as ironing, pressing, packaging is considered much importance as the value added of the final product increases. There have been relatively few technology innovations at this production stage to ensure a high quality.
On the whole, technological changes in the garment sector have been moderate and it is in any case a very labor ¡V intensive activity. But the backward state of most of the textile industry means that the garment industry is highly import ¡V intensive, and many opportunity for economic import substitution in the labor ¡V intensive component of the textile industry have gone missing.
8. Production effectiveness of the industry
In order to consider the effectiveness of the industry we must distinguish 2 kinds of business (see diagram 1). The first kind is in subcontracting form. In this form, the buyers (EU market, Japan, North America) do not give order directly, but give through middle man (NICs: Taiwan, Korea, Hong Kong, Japan), because they are not familiar to Vietnam¡¦s producers. In this kind of business, of course the value added is low. In Vietnam textile and garment industry mainly has to take this kind of business. In average, Vietnam producers do not make more than 20% of net price (mainly subcontracting cost), the remaining of 80% belongs to the buyers and middle man providing materials, accessories and design. The share of domestic value in total export value of garment and textile is quite small. Nearly 80 percent of textile and garment export values are made through processing orders. Thus in the case of textile and garment industry, high export value or high output value do not indicate the prospect of the industry, since in order to obtain such high records, these requires large amount of imported materials. The indicator of value added is more reliable to examine the industry¡¦s performance. It is clear that value added in the industry is rather low. according to VINATEX statistic, of 5,500 billion dong of garment industry in 1997 only 10 billion dong (0.18% of revenue) is net benefit.Diagram 1: Vietnam in the international manufacturing triangle
The second kind of business is direct contract of Vietnam's producers and foreign customers. This consists of small part of total export value. Almost of that is export with small volume to Former Soviet Union or East European countries.
We do not have the statistical figure about the share of labor in total value added in Vietnam's garment and textile sector. But according to interviews with directors of some garment enterprises in the past survey conducted by the Institute of Economics, the share of labor in subcontracting price accounts for around 50 ¡V 55%. Thus we can compared it with that of other countries(see table 5).
Table 5 : Share of labor in total value added in the textile
and clothing industries.
(Percentage)
| Textile | Clothing | Other manufacturing |
| Hong Kong | 55 | 70 | 50 |
| Republic of Korea | 51 | 69 | 47 |
| Taiwan | 53 | 77 | 53 |
| Indonesia | 33 | 50 | 19 |
| Malaysia | 53 | 47 | 31 |
| Philippines | 42 | 61 | 36 |
| Singapore | 82 | 74 | 41 |
| Thailand | 20 | 35 | 19 |
| China | 42 | 52 | 37 |
| South Asia | 43 | 53 | 37 |
Source: Studies in Trade and Investment 17, United Nations, New York, 1996.
Productivity and skill level in the garment and textile is still low. In the garment sector Vietnamese workers are able to produce only 16 shirts in average daily, while in other countries this figure is 27.
The labor productivity of the industry measured as value added per worker was very low in the early 1990s compared to all other countries in the table 6. The productivity ratio is still very low especially compared to Korea, Taiwan and Singapore, but in recent years Vietnam¡¦s value added per worker ratio has caught up with China. The financial crisis has significantly influenced on the labor cost of some Asian countries in 1998. This is the case for Indonesia where the labor productivity has fallen dramatically.
Table 6: Value added per worker (constant prices) in USD
Year | Vietnam | China | Indonesia | Malaysia | Korea | Taiwan | Singapore |
| 1992 | 520 | 1,400 | 3,000 | 6,800 | 24,100 | 21,600 | 14,060 |
| 1993 | 870 | 2,260 | 3,600 | 7,260 | 27,090 | 22,300 | 13,960 |
| 1994 | 990 | 1,580 | 4,600 | 8,750 | 29,900 | 20,000 | 14,840 |
| 1995 | 1,380 | 1,490 | 3,900 | 9,890 | 37,870 | 20,300 | 16,270 |
| 1996 | 1,720 | 1,490 | 4,000 | 10,450 | 37,210 | 22,500 | 16,270 |
| 1997 | 1,720 | 1,650 | 3,700 | 10,700 | 33,160 | 22,900 | 16,190 |
| 1998 | 1,770 | 1,760 | 1,100 | 7,980 | 20,510 | 21,100 | 15,560 |
Source: estimates by UNIDO and DSI
9. Markets of Vietnam's garment and textile products.
1. Domestic market.
Due to trade liberalization textile and garment products are coming to Vietnam from different sources: legal and illegal imported through different channels. Demand pattern of domestic consumers has changes, shifting from enough wearing requirement to beautiful wearing one. The consumers have various choices to meet their demand. The habit of Vietnamese has changed. Vietnamese have been shifting from buying fabric to make clothes in tailoring shops to buying ready made clothes. All these factors have impact on the textile and garment production in Vietnam.
In the domestic market, textile and garment producers have to compete with stronger rivals in the region. Being ASEAN member and implementing AFTA, Vietnam¡¦s domestic market is ¡§ playground¡¨ of regional countries. As compared to regional countries Vietnam¡¦s textile and garment industry goes after 7 ¡V 8 years in the hard part and 10 ¡V 15 years in the soft part. Thus to occupy the big proportion of domestic market is challenge for Vietnam¡¦s producers in textile and garment industry.
According to statistics of VINATEX, in 1996 domestic trade turnover of garment goods produced in Vietnam is approximately 53 trillion dong, accounts for only 8.2 of total garment turnover. For textiles, the domestic trade turnover is approximately 1640 trillion in the total textile value of 3,334 trillion. Thus total Vietnam¡¦s textile and garment sold in the domestic market is 1,700 trillion. In Vietnam GDP per capita for 1996 is USD 200, the proportion of GDP per capita for clothes of Vietnamese is 3% annually, that is VND 60,0001, so total expenditure for clothes of Vietnamese in the whole country is VND 60,000 * 70 million people = VND 4,200 trillion. It is clear that garment & textile industry can supply only 40% of domestic market. The rest of 60% is met by the legal and illegal imports overseas.
1The accounted exchange rate for 1996 is 10,000 dong / USD
2. Export market
Until the end of the 1989s Former Soviet Union and East European states were Vietnam¡¦s main trading partners which accounted for about 90% of total export value of textile and garment. Indeed, for many years, Vietnam had tried to expand and strengthen relations with its traditional partners. The collapse of the socialist system impelled Vietnam to find new markets.
With its new policy of diversifying foreign economic relations, Vietnam now has trade relations with 105 countries and has concluded bilateral trade agreements with 67 countries. At present, Vietnam¡¦s textile and garment industry carries trade ties with over 30 countries throughout the would, and its businesses have relations with hundreds of overseas companies. Vietnam now has yet to be active on the export market and approach traditional clients. Export market of Vietnam garment & textile products consists of quota and non ¡V quota markets
Export to EU market is subjected to export quota. The agreement on textile and garment trade between Vietnam and EU was initialed on December 15, 1992 and took effect from January 1, 1993. According to the agreement, Vietnam was entitled to export to EU 151 categories, of which 46 were free, that is not subject to quota. In addition, there were 13 categories produced through subcontract (embroidery, lace...), accounting to hundreds of tones per year. Total quota were 21,298 tons, worth about 450 million USD.
On July 16, 1996 in Brussels this agreement was officially signed. According to the Agreement, which valid for 5 years (1993 ¡V 1997), the quota of each category will have an year on year increase of 1.5 ¡V 2.5%.
The Vietnam ¡V EU textile and garment agreement has made a positive contribution to developing Vietnamese textile and garment industry, bringing the Vietnamese products into EU market. Vietnamese garment goods have been exported to almost all EU countries, except Luxembourg. The main market in the EU bloc for Vietnamese textile and garment goods is Germany, which imports approximately 26 million USD (46.4%), followed by France for 8.2 million (14.6%), the Netherlands 6.4 million (11.4%), Britain 4 million (7.1%), Italy 3 million and then Belgium, Spain, Sweden, Austria, Finland, Portugal, Ireland and Greece.
In the earlier period, quota and commodities articles covered by the Agreement were not really consistent with the Vietnamese production capacity, but then a diversification of products was gradually taking place. Every year, more and more new commodity articles were tapped. In 1993, Vietnam was able to handle only 55 categories of the 151 in the agreement. The figure was raised to 66 in 1994 and 75 in 1995.
From 1993 garment & textile export to EU countries continuously has increased by 23% in average annually. In 1993 Vietnam exported USD 250 million. In 1994 Vietnam exported USD 285 million. In 1995 and 1996 garment and textile export value is USD 350 and USD 420 million respectively. In 1997 export turnover is USD 450 million. Last year export turnover of textile and garment is USD 700 million.
Non ¡V quota market for Vietnam¡¦s export of textile and garment goods has increased rapidly in recent years. In 1996 the export value to this market is 650 million USD, increased by 80% compared to 1995.
Japanese market is biggest non ¡V quota market. Despite being superpower in the textile and garment industry, the high cost of labor forced Japan to change its strategy, reducing domestic production and increasing textile and garment imports. The market has high consumption capacity and requires no quota for Vietnamese exports. In 1996 Vietnam exported to Japan 486 million USD of garment and textile products.
Asian countries such as Hong Kong, Singapore, Taiwan and South Korea are ranked among large importing countries of Vietnam textile and garment export.
Markets in the Former Soviet Union and East European countries also have been a strong consumer market, with populous areas and need no quota for Vietnamese garment exports. Up to now Vietnam has exported to this market based on commodities exchange and debt liquidation.
Vietnamese textile and garment exporters have in effect been excluded from the US market, initially owning to the absence of diplomatic relations more recently because it still does not enjoy MFN status in that market. Hence the US export market for Vietnam is a tiny, and exports just 2% of Vietnam exports (USD 23.6 million).
As presented above, Vietnam¡¦s garment export rely heavily on Europe and Japan, which in 1996 absorbed 43% an 42% respectively of the total. This is distinctive feature of early ¡V stage East Asian countries. For these countries the dominance of textile and garment export is US market. The US is a large segmented market in term of quality, price and fashion. And one a quota has been secured, it is a relatively open and uncomplicated market. Although not quota constrained, Japan is regarded as a much tougher market to penetrate in term of standards of quality and complex marketing channels.
Chart1
Table 7: List of 15 Asian countries importing Vietnam's
textile - garment products in 1997
(Unit: US$)
Order | Country | Value | Import percentage |
1 | Japan | 325,048,758 | 46.551% |
2 | Taiwan | 197,529,175 | 28.289% |
3 | South Korea | 75,953,429 | 10.877% |
4 | Singapore | 55,796,225 | 7.991% |
5 | Hong Kong | 26,629,782 | 3.814% |
6 | Malaysia | 7,570,083 | 1.084% |
7 | Laos | 3,151,433 | 0.451% |
8 | China | 2,599,437 | 0.372% |
9 | Thailand | 2,145,586 | 0.307% |
10 | Philippines | 967,007 | 0.138% |
11 | Combodia | 590,550 | 0.085% |
12 | Iran | 106,202 | 0.015% |
13 | Iraq | 92,995 | 0.013% |
14 | India | 73,013 | 0.010% |
15 | Indonesia | 12,390 | 0.002% |
| Total | 698,266,065 | 100.00% |
Source: General Department of Customs.
Table 8: Top ten Textile and garment importers in 1997
(Unit: US$)
Order | Country | Value | Ratio against total imports |
| 1 | Japan | 325,048,758 | 20.13 |
| 2 | Taiwan | 197,529,175 | 25.31 |
| 3 | Germany | 164,585,288 | 41.59 |
| 4 | South Korea | 79,953,429 | 21.58 |
| 5 | Singapore | 55,796,225 | 4.82 |
| 6 | France | 55,396,646 | 24.34 |
| 7 | Netherlands | 42,940,964 | 17.07 |
| 8 | Russia | 41,436,581 | 34.59 |
| 9 | Switzeland | 33,955,018 | 10.67 |
| 10 | Britain | 32,230,041 | 14.27 |
| Total | 1,024,872,125 | 18.83 |
Source: Genaral Department of Customs
III TREND AND CLIMATE
1. Technical trend and climate of the industry
1. Technological renovation
As above presented Vietnam¡¦s textile and garment has achieved a notable success recently. However, the industry is facing a number of difficulties, which need to be surmounted to ensure its continued rapid growth. The industry¡¦s most pressing problem is its equipment and machinery. The out ¡V dated technology has contributed to low production capacity and bad quality product, thereby, deteriorating Vietnamese manufactures competitiveness in the international market. That is why, unsurprisingly many enterprises enjoying exports quotas, to the EU and other countries do not export the goods directly, but intermediaries. This has caused losses. Investment in progressive production technology, equipment and machinery is the only one way for Vietnam¡¦s textile and garment industry to sharpen its competitive edge on the international export market.
At the beginning of 1990s, technology renovation has been considered as urgent issue for existence of the industry. According to the report of VINATEX, the textile and garment industry has achieved progress in equipment renovation in the 1991 - 1995 period. As a result, technology situation of the industry has been improved significantly. We can see more detail in each kind of equipment.
Fiber spinning equipment: the industry has improved 201,960 spindles with USD 39,964,407 by full - replacement or part - replacement. In 1996, some new factories started in operation, such as new fiber factory with 26,000 spindles (Japan) belonging to Thanh Cong Textile Company; factory with 10,000 spindles belonging to Nha Trang Textile Company; factory with 90,000 spindles (Japan) and factory with 6,000 spindles belonging to Viet Thang Textile company; factory with 8,928 spindles (Italy) belonging to Hoa Tho Textile Company, and factory with 1,600 rotors (China) belonging to Phong Phu Textile company.
Fibre produced by newly invested line has high quality with criteria under 50% of Uster internationally Statistical system. Besides, some commodities have achieved under 25% level, under 10% level according to Uster system.
Shuttle weaving equipment: Investment capital for shuttle weaving in the 1991-1995 period was USD 14,087,585. The investment in shuttle weaving in the past 5 years focus on:
- Replacement the old equipment by the new one;
- Large size of weaving equipment;
- Improvement technologies to create new products;
- Improvement the quality of preparing stage for weaving production.
The newly equipped kinds of weaving equipment including:
- Sinkwang weaving machine made in South Korea.
- Second-hand Picanol weaving machine.
- Second-hand Vamatex weaving machine.
- Nissan weaving machine using water power, specializing on synthetic cloth.
- Rotal starching machine made in Italy.
- Kawamoto starching machine made in Japan.
- Starching machines with large size made in China.
In the past five years the efficiency of investment has been achieved mainly from the technology improvement and diversification of commodities. The shortcoming of investment has been unclearly synchronous among stages such as fibre, weaving, dying.
Knitting equipment: Famous and traditional firms, such as Thang Long Knitting Company, Thang Loi Knitting Company - Nam Ha province, Chan A Knitting Company - HCM city have been operating inefficiently. The main cause of that these firms were not reinvested by new equipment, therefore their products can not be sold in the market.
Conversely, all reinvested firms in the 1991-1995 period such as Hanoi Textile Company, Nha Trang Knitting Company and Thanh Cong Textile Company, etc. have high efficiency and can receive foreign currency by export commodities directly. The efficient investment on knitting textile is enhanced specially for the firms that can produce fiber themselves for making knitwear.
Knitting project requires not much of capital for the synchronized investment (USD 3 - 5 millions for each project with capacity of 1000 tons per year) and can create many jobs because of using labour-intensive technologies. Due to investment in knitting weaving, the output share of knitting products in total textile products in Vietnam is over 10 percent.
Printing and dying equipment: In the 1991-1995 period, central and local SOEs imported around 219 machines with the value of USD 28,878,00. These machines are included:
- Two knitting - dying factories belonging to Hanoi Textile Company and Nha Trang Knitting Company.
- Two sock-dying factories belonging to Nha Trang Textile Company and Hanoi Textile Company.
- Two feather-burning, boiling, cleaning and dying lines belonging to the 8th March Textile Company and Nam Dinh Textile Company. These two lines are imported from Japan and were installed completely in the mid of 1995. The capacity of each line is around 15 million meters long with 1.5 - 1.8 meters in width per year. These lines clean and dye for cotton and Pe/Co cloth is at high quality.
- Over 200 machines have been invested in the enterprises in order to increase capacity, quality of products, and to diversify products, such as feather-burned machines, cleaning machines, dying machines, printing machines, especially anti - elasticity machines, comfit machines, etc.
New imported machines are all in the A3 generation of many countries in the world, mainly in Taiwan, South Korea, Japan, Germany, Hong Kong, France and the United States.
Garment equipment: In the 1991 - 1995 period VINATEX has newly equipped with 19,527 machines, worth 267 billion dong. The advantage of this sector is to require not much of capital for technology renovation and to have ability to pay back.
The actual technology renovation in the 1991 - 1995 period shows that investment is necessary for development, but how to invest is more important to increase the efficiency of the industry. The lessons learned from the technology renovation in the past period is following:
- To choose proper product to produce based on deep analyses the market;
- To choose proper scale in investment;
- To choose equipment adapted to Vietnam's condition which has comparative advantage in labor;
- To balance the technology renovation between stages of production in the industry in order to prevent the case that some stages of production are over - invested, some others are under - invested;
- To raise the " absorptive capacity"2 of the industry in order to increase efficiency of imported technology. 2¡§ Absorptive capacity¡¨ of the industry is ability to master a new technology, which affects the choice of the type of machines
In the coming period up to year 2010, the industry will focus on deeply synchronous and completed investment for each production line in order to innovate technology depending on the Vietnam's conditions such as finance, products, current technology situation. The industry has worked out the plan of technology renovation for each sector of the industry up to year 2010.
For fiber sector: The production lines belonging to the 1960s and 1970s are needed to be changed. The system of cotton machine is needed to be changed firstly. Improving brushing machines in order to increase brushing speed at 30 - 40 circles per minute. Complementing careful brushing system and modern machines to produce fiber of high quality and fiber for knitwear.
The directions of selecting equipment, technology and spare parts as follows:
- For enterprises having the modern production line to produce fiber, cotton fiber of high quality and exported textile products: the machines should be imported from North America, Japan, Western European countries.
- For enterprises producing fiber with normal criteria: the machines should be imported from Asia.
For weaving sector:
Appropriate equipment and technologies will be chosen based on the key commodities that have been demanded recently and new commodities that meet new market demand. Hence, the direction of investment is to modernize technology step by step to achieve the world standard.
Investing on modern equipment without shuttle and reducing the number of shuttle weaving machines, especially ones with small size. In 2010, it should have only small number of shuttle textile machine producing some traditional commodities.
- In starching stage, old equipment have to be replaced by modern one. Modern starching machines must be highly specialized such as starching machine with one trough for thin cloth, two troughs for thick cloth, and specialized starching machines for filament fiber, etc.
- Improving other equipment to raise the quality of synthetic, checked, and stripped cloth.
Concerning knitting machines, up to now the industry has four kinds of equipment: rounded knitting, straight knitting, flat knitting, socks knitting one. However, in order to produce sophisticated commodity of knitwear, it is needed to pay attention on dying - finishing and cutting-sewing stages. For the coming period, the industry should replace old equipment produced before 1975 and use technology of average or high level in the region.
For dying - finishing sector: This is an important stage. Beside it is a factor affecting the quality of products, the finishing stage plays an important role in raising the value of products. Therefore, innovation of dying-finishing technology is very essential.
- Up to 2000, replacing all small size equipment made in the 1960s.
- Up to 2005, replacing parts of equipment made in the 1970s and improving part of it that can still be used. Investing on modern technology for producing some key commodities for planned regions. Step by step investing on finishing equipment to raise quality and value of product meeting market demand.
- Up to 2010, renewing all equipment and technology for large and exported enterprises. In the medium and small enterprises producing domestic goods normal technology can still be used, but the quality of products must be satisfied by consumers. In addition, environmental projects must be implemented efficiently. The level of technology must be equal to that in South Korea, Taiwan, Honking at present.
The direction of selecting equipment and technology as follows:
- For important stages such as dying, printing, completely finishing: equipment should be imported from developed countries such as European countries, Japan, United States.
- For other stages: equipment imported in countries in the region such as South Korea, China, Taiwan.
- For medium and small enterprises: second-hand and domestic equipment can be selected.
For garment sector: The technology of garment industry is needed to improve in order to catch up with other countries in the region.
- Preparing stage of production: Computer will be used in some functions; Changing and improving pressing-stick machines with high quality; Installing automatically cutting machines operating with program, laser - cutting machine.
- Sewing Stages: Replacing industrial-sewing machines has been used for more than 10 years; Installing automatically specialized machines in production lines.
- Finishing stage: The machines that are needed to invest include button-holing, button - sewing, formed pressing machines, high quality ironing equipment; Investing in some washing - grinding workshops.
The direction of selecting equipment as follows:
- Industrial and specialized sewing machines: importing from Japan.
- Automatically specialized machines, pressing machines, finishing equipment: importing from Germany
- Equipment for jeans making: importing from Germany and the United States.
- Other supplemented equipment: importing from neighboring countries in the region.
2. R & D of the industry
R & D has been taken in the level of the whole industry only. According to the 2 surveys in the textile and garment industry conducted by the Institute of economic in 1994 and 1998, there were no any R & D in the level of enterprises. However, in the textile and garment industry there are 2 institutes doing R & D. That are the Textile ¡V Fiber Industrial Institute and Fashion ¡V Style Institute.
In the last years, the Textile ¡V Fiber Industrial Institute has concentrated on the following basic issues:
- To study material source produced domestically;
- To apply new technology into production for improving quality and pushing down the cost;
- To study for new products made by the existing material and equipment;
- To study for substituted accessories;
- To disseminate new information and knowledge on textile and fiber.
Over 50 percent of research results have been applied in the practice. However in general, research force of the Institute is week and does not corresponds to the requirement of industry¡¦s development.
The Fashion ¡V Style Institute was established in 1995, developed from Former Garment Research Center. The design capability of the Institute is still limited. Staffs of the Institute lack knowledge on design and information. The Institute meet only 10%¡V 20% of demand. With strategy of industry¡¦s development in increasing export in pattern of FOB, the research task of the Institute become more necessary and urgent.
3. Industry Associations
The literature on economic development increasingly emphasizes the importance of institutions as a key factor contributing to good policies. Where institutions are not well developed, market and government both often get failures, in the economics sense that efficient solutions are not adopted by economic agents because of deficiencies in information and price signals.
The development of institutions at the micro, industry level is just as important as at the macro level, and a case in point in Vietnam¡¦s textile and garment industry concerns the absence of an effective industry association. Such an association is important to the development of the industry.
Currently, in the industry there are two associations representing textile and garment enterprises, one for SOEs ¡V that is VINATEX and the other for private enterprises. VINATEX was established in 1995 according to the Decision 91/CP of the Prime Minister in order to operate as strong conglomerate. It consists of 44 central SOEs. At present, the actual functions of VINATEX are similar to industrial function of management for the member enterprises. That is totally different from objectives of industry association.
On the other hand, association representing for private enterprises is informal. It plays as a counterpart of State ¡V owned association and struggle for equal environment with SOEs. Thus in the textile and garment industry there is absence of an effective industry association playing two main functions as followed:
- First, an association can overcome problems of ¡§ market failure¡¨, which arise when certain measure are desirable on an industry ¡V level basis but are unattractive or unprofitable for private enterprises.
- Second, an association can help the government to know industry¡¦s major challenges and obstacles in very competing international market.
2. Market trend of the industry.
1. Domestic market
The domestic market of more that 70 million people at present and of 100 million people in 2010 is a market with big potential for textile and garment products. According to primarily estimates, GDP per capita in Vietnam will be USD 600 ¡V 800 up to 2005 and USD 900 ¡V 1,200 up to 2010, so demand for consumption good will be USD 250 ¡V 350 per capita in 2005 and USD 400 ¡V 450 in 2010 and the proportion of textile and garment expenditure in GDP per capita will be 6 ¡V 8 percent. These figures show that demand for consumption goods in the whole and demand for textile and garment in the particular will be large. That requires the textile and garment industry has to have appropriate steps and solutions in the coming period to occupy the domestic market. The textile and garment industry has to reorganize the production, apply new technology to raise quality, put down the cost, establish the selling net through the country.
On the other hand, when CEPT and AFTA will completed in 2006, Vietnam¡¦s textile and garment producers have more challenges in competition with other ASEAN countries whose commodities have better quality, pattern and parking. Thus the textile and garment producers only have 6 years for improving their technology, heightening their business efficiency. If Vietnam¡¦s textile and garment businesses fail in their efforts, domestic market will fall into the hands of neighboring rivals.
2. Export market
Vietnam has four major export markets. Among of that EU, Japan and USA markets are highly quality required. The industry has exported only categories of low and average ranks. Vietnam producers still have not made highly ranking categories. The main objective of the industry is that to stimulate Vietnamese businesses to expand and find out markets.
The 1998 ¡V 2000 Vietnam ¡V EU textile and garment accord gives Vietnam larger priority and easier access to freely exchanging quota of different garment items within the scope of 12 ¡V 17 percent. Despite this significant improvement, the accord can only meet more than 40 percent of the industry production capacity.
Since 1971 the EU has begun to levy new GSP (Generalized System of preferences) on developing countries with the purpose of helping them to industrialize and diversify their exports. For Vietnam, the new GSP has been realized in two phases during 1997 ¡V 1998. Accordingly, Vietnam¡¦s textiles and garments exported to EU markets belong to group 4 and are subject to tax level which equal to 85 percent of the EU common tariff.
However, as compared to other countries in the region the volume of goods the EU allowed to be imported from Vietnam was still much lower. For example it was about 5 percent of what Chinese manufacturers could bring in and 10 to 20 percent of the figure from other Asian countries. In addition, the number of goods lines controlled by quota was higher 54 for Vietnam as compared with 20 in Thailand, 8 in Singapore and 10 in Indonesia.
In a word, the textile and garment industry faces many advantages and challenges in terms of exporting garment items to EU markets. To achieve a goal of increasing export, the industry should work to become more fully competitive internationally. Estimated textile and garment exports to EU markets is USD 1.5 ¡V 2 billion.
Japanese market has high consumption capacity and requires no quota for Vietnamese exports. At the same time Japan also has imported a lot textiles and garments from Asian countries, such as China, Korea, Thailand, Taiwan, Hong Kong, Indonesia, etc. If Vietnam does not properly invest in improving product quality and lowering prices, Vietnamese textile and garment could not compete in Japanese market. Estimated Vietnam¡¦s textile and garment export value to Japan will be USD 1.2 ¡V 1.5 billion.
The US has been the major export market for East Asian textile and garment exporters. Vietnam has suffered through it inability to secure effective access to this market. up to now, Vietnam remains one of handful countries that the US has not yet granted MFN status. As a result, Vietnam's export faces much higher tariff rates under the general tariff schedule. Not only is the US market the largest in the world, but it is a relatively open one, and it caters to a large range of qualities, thus enabling exporters to develop market niches which suit their circumstances. Obtaining MFN status is clearly a complicated negotiating process. After obtaining MFN, USA also levy GSP on developing countries. The benefits will almost certainly outweigh the cost, and thus there is a strong case for assigning the highest priority to this objective. Thus securing MFN status in the US market is important condition for improving production performance as well as export performance of textile and garment industry. That highlights the importance of Vietnam securing MFN status in the US market as quickly as possible.
The Former Soviet Union and Eastern European countries are familiarizing themselves with Vietnamese products and are not very requiring markets. Vietnamese products can easily slide into these markets. So that textile and garment industry has to exploit much more this market and improve payment form.
In addition to those four major export markets, other markets in Middle ¡V East, Latin ¡V America countries, Africa have been showing considerable promise due to their numerous population. In formulating strategy for the opening of new markets, Vietnam should pay more attention to these secondary potential markets.
In a word, four necessary issues in marketing orientation for the coming period are as follows:
- To develop supermarket, wholesaler, commission seller system to meet domestic style and demand gradually in the whole country.
- To shift from processing to doing business in pattern of FOB. To set up representative offices and Vietnam¡¦s textile and garment stores in the big markets in the world.
- To push up fashion activities, to train marketing staffs.
- To integrate internationally and regionally by development investment and reorganization of textile and garment enterprises according to market mechanism and internationally quality control system ISO 9000, by marketing, workshops, exhibition and participation in the international textile and garment association, international cotton association, exchange with world fashion.
3. Institutional environment
The notable achievements obtained by the textile and garment industry over the past years have contributed a lot by the economic reforms changing institutional environment. This section will present the economic reforms have strong impact on the activity of micro levels in general and on the enterprises of textile and garment industry in particular, such as multi - sectorial development policy, taxation, investment and trade policies and then withdraw some of the major challenges which industry is currently facing and to argue the case that reform is required to sustain industry¡¦s growth.
1. Multi - sectorial development policy.
In Vietnam SOE system started exist with the founding of the Democratic Republic of Vietnam in 1945. SOEs, together with non - corporate economic institutions, such as the State Bank, the national reserves and infrastructure system, constitute the state - managed economic system in Vietnam. They comprise all the capital, assets, and natural resource of the country, owned by the nation. The government is sole representative of this ownership.
The state sector played a crucial role in the national economy between 1956 and 1975, and a similarly important role across the Socialist Republic of Vietnam from 1975 to 1985. Since the official initiation of economic reform in late 1986, fundamental changes to restructure SOEs and permit private enterprises to take more dynamic role within the economy. And then, particularly after 1989, other non ¡V state economic sectors have developed. Although, SOEs still occupy a very important position in the national economy.
At the same time, the government has adjusted macro ¡V level policies and rule of game which is affecting enterprises to create equal environment for all sectors. The government has introduced various legal institutions to guide the multi - sectorial market ¡V oriented economy. However, the reform has not forced SOEs to operate in the equal environment with the private sector. SOEs still maintain advantages over private enterprises because of their greater access to land use rights and trade licenses. Furthermore, the position of industry¡¦s SOEs as dominant enterprises sharing dominant position in the industry has made it easier for them to resist adapting to condition of effective competition.
At present, textile and garment private enterprises in Vietnam still operate in a difficult business environment, and at a distinct disadvantage as compared to SOEs. These factors hamper their ability to compete internationally. The obstacles for private enterprises in the textile and garment industry are as follows:
- It is difficult for private enterprises to acquire land for industrial sites. The process of land acquisition appears to take several years of complex negotiation. And even when they obtain access to land, their title is based on very insecure access.
- It is difficult for private enterprise to access to the financial sector. It is well known that private enterprise rely heavily on land as collateral in loan applications. Owing to imperfection in the land market, they are not able to use land as collateral, they are forced into the informal financial market, where interest rates are typically 3 ¡V 4 times higher. Besides, Vietnam¡¦s financial system is still under ¡V developed, the dominant state banks appear unwilling to lend to private enterprises, while most private enterprises do not have the resource to borrow from foreign banks with branches in the country. Private enterprises report great difficulty in obtaining finance for both fixed and working capital.
- Finally, private enterprises complain about the unequal distribution quota for textiles and garments export between SOEs and private sector.
1. Taxation policy
Before the economic reform, tax system in Vietnam was very poorly developed. It created different treatments among sectors in the economy. It consisted of two separated components which were working in parallel. One was taxes imposed on SOEs and cooperatives, and the other was taxes on private sector. Therefore, one of the targets of tax reform was to make the tax system equally apply to all sectors to stimulate the development of the economy. Thus different taxes were introduced to replace the old decree ¡V based taxes. To early 1990s, there were 9 main taxes and some other taxes which can be considered as fees. From then the tax system in Vietnam has been revised frequently to adapt to development of the economy and it has brought positive impacts on the development of the economy as well as on the state budget. In general, the development of tax system in Vietnam has just finished the primary period to form taxes, the further reform or further development of taxes is needed to make the tax system to become transparent, neutral and to encourage the development.
Until last year, the enterprises in the textile and garment industry complained too much about the overlap in turnover tax. The turnover tax had generated inequality between the garment workshops of the textile enterprises and other garment enterprises. The garment workshops of the textile enterprises were not liable to tax on fabric produced by themselves, while other garment enterprises were subject to turnover tax on the value of the fabric which they bought from other businesses. Therefore, many textile enterprises have set up new garment workshop because of creating employment as well as avoiding tax overlap. The cost of garment product in garment enterprises is higher than that in the garment workshop of textile enterprises if other factors being equal. This overlap was phased out when the government has replaced turnover tax by the value added tax in the beginning 1999. The cost of product will reduce due to effort of each enterprises rather than tax mechanism.
Collecting the tax from private enterprises is a difficult job because of uncompleted accounting system in Vietnam. Turnover revenue and profit of are usually declared in lower value for evading tax. The tax for enterprises in this sector always is worked out by negotiation between tax payers and tax collectors. Thus Vietnam should to improve the accounting and auditing system in order to give equal environment on paying tax between enterprises of different sectors.
3. Trade policy
Trade regime has direct impact on textile and garment industry including 1) Access to foreign trade; 2) Foreign exchange control; 3)Export quota; 4) Export and import duties.
1. Access to foreign trade
Before 1986, international trade was done by a number of SOEs under centrally planned mechanism. After economic renovation, the entry into international trade has been relaxed with more participation of private enterprises. In early 1990s the entry to trading normal goods was relaxed by imposing the import ¡V export license and shipment license. In 1996 the barrier was further lower by reducing number of normal imported goods that import license and shipment permission was phased out. In early 1998, Decision 57/CP dated 31/7/1998 indicate that all enterprises are allowed to trade their goods registered in business license with no need to ask for import ¡V export license except some special goods (rice, textile and garment exported to quota market, and prohibited or under the commodities management of the government) and foreign investment enterprises are also encouraged to export goods not produced by themselves. This means that enterprises can export their products not under special regulations directly or through foreign investment enterprises without any permission except business license. However, the recent survey of 30 textile and garment enterprises in Hanoi and Ho Chi Minh cities conducted by the Institute of Economics in the beginning of 1999 shows that some directors of private enterprises still can not directly export their products, even though the Decision No 57/CP has been in effect in August, 1998. It is clear that regulations appear to be implemented unevenly across ownership, groups and regions.
2. Foreign exchange control
According to the Decision No. 63/CP dated 15/8/1998 was issued to replace the Decision No. 161/HDBT dated 18/10/1988, all organizations and individuals are required to put their foreign currency into account in the Banks. Currency in their account can be used for paying their import of goods and services and the rest is to sell to the government at market price, all transfers to foreign countries have to have permission from State Bank. State Bank will supply foreign exchange for enterprises for foreign trade activities but the access to it is not always available, especially for private firms.
Recently, because of impact of regional financial crisis, the State Bank has applied striker measures to control foreign exchange, for example all organizations, firms and individuals are required to have only one foreign currency account a Banks and have to sell to the Banks 80% foreign exchange in heir current account (stipulated in the Decision 173/QD ¡V TTg dated 5/10/1998). The disadvantage of this measure is that enterprises are required to sell their foreign exchange, but when they need, they have to buy at higher price and have to wait for making balance. That makes a lot troubles for exported enterprises.
3. Export quota
World textile and garment markets have been the most distorted among manufactured commodities. It has been regulated by consecutive international agreements. These agreements include the Short Term Arrangement regarding Cotton Textile, the Long Term Arrangement regarding Cotton Textile and the Arrangement regarding international trade in Textile, better know as the Multifiber Arrangement (MFA). They were all aimed to curb export of textiles and garments from developing to developed economies. The quota markets for Vietnam¡¦s textiles and garments are
EU, Norway, Canada and Turkey.
As mentioned above, in December 1992, Vietnam and EU signed an agreement on level of export quotas. In July 1996 the agreement was officially signed in Brussels. In November 1997 Vietnam and EU sign a new agreement on higher level of garment and textile export quotas.
Norway offered quota of 700,000 pieces a year since 1994. Export quota from Canada market was set up at level of 1 million pieces for 1994 and at level of 3 millions pieces for 1996.
Vietnam has done reasonable well out of quota growth in recent years, especially to the EU, even though Vietnam started from a low starting point. Negotiating continued quota expansion must always be a high priority for the government.
In Vietnam, quota allocation regime has been improved frequently to ensure that quota allocation is fully utilized, and the quota destination markets are satisfied with domestic allocation procedure. The existing quota allocation regime has been stipulated in the Inter ¡V Ministry Circular No. 20/1998/TTLT/BTM/BKHDT/BCN dated 12/10/1998. According to this Circular, the quota allocation has following common stipulations:
- The quota is allocated jointly by Ministry of Trade and Ministry of Industry, and Ministry of Planning and Investment.
- The enterprises getting quota must be textile - garment enterprises, which are able to produce export goods, must have business license or investment license according to the foreign investment law in Vietnam and enterprises have quota in previous year.
- Enterprises located in Hanoi and Ho Chi Minh city are allocated 80 percent of 1998 performanced export volume to EU market for following categories: 4(T. shirt), 5 (sweater), 6 (pants), 7 (female chemise), 15 (female overcoat), 21 (jacket), 26 (skirt), 31 (underwear) and 73 (sport clothes). At the same time they have right to participate in the quota auction.
- 30 percent of quota in every category to EU market will be given priority to enterprises sign direct contract with European industrial customers that recommended by European Union..
- 5% of export quota (10% for T ¡V shirt, polo - shirt) is reserved for the purpose to encourage the enterprises which produce export good using domestic materials and the enterprises which operate in a pattern of FOB and another 5% is reserved for the purpose to encourage the enterprises that export big volume to non - quota market.
- Having received its quota, in case enterprise is not able to export enough, this enterprise has to return the quota to MOT and MOI for the purpose of redistribution. Selling and leasing quota are prohibited. The enterprise which does not follow this rule will not be distributed quota in the next year.
- The enterprises have to pay quota fee either for each quota grant or for each shipment:
| 1 | commodities | category | quota fee |
| 1 | T ¡V shirt, Polo ¡V shirt | 4 | US$ 0.02 / unit |
| 2 | Sweater, pullovers, cardigans, woolen clothes | 5 | US$ 0.05 / unit |
| 3 | Pants, shocks | 6 | US$ 0.05 / unit |
| 4 | Female chemise | 7 | US$ 0.05 / unit |
| 5 | Male chemise | 8 | US$ 0.05 / unit |
| 6 | Small panties | 13 | US$ 0.01 /unit |
| 7 | Male overcoat | 14 | US$ 0.20 /unit |
| 8 | Female overcoat | 15 | US$ 0.50 /unit |
| 9 | Jacket | 21 | US$ 0.30 /unit |
| 10 | Skirt | 26 | US$ 0.05 /unit |
| 11 | Knitted clothes | 28 | US$ 0.02 /unit |
| 12 | Small underwear | 31 | US$ 0.05 /unit |
| 13 | Female clothes | 29 | US$ 0.10 /set |
| 14 | Sport clothes | 73 | US$ 0.10 /set |
| 15 | Gloves | 10 | US$ 0.05 /dozen pair |
| 16 | Socks | 12 | US$ 0.05 /dozen pair |
| 17 | Towel, bathing suit | 9 | US$ 20.00 / ton |
| 18 | Shuttle weaving clothes | 18 | US$ 50.00 / ton |
| 19 | Blanket | 20 | US$ 40.00 / ton |
| 20 | Synthetic fabric | 35 | US$ 25.00 / ton |
| 21 | Embroidering table cloth | 39 | US$ 40.00 / ton |
| 22 | Synthetic fiber | 41 | US$ 20.00 / ton |
| 23 | Baby clothes | 68 | US$ 50.00 / ton |
| 24 | Working clothes | 76 | US$ 50.00 / ton |
| 25 | Clothes of various kinds | 78 | US$ 200.00 / ton |
| 26 | Knitted clothes | 83 | US$ 50.00 / ton |
| 27 | Net of various kinds | 97 | US$ 50.00 / ton |
| 28 | Linen scarf | 118 | US$ 40.00 / ton |
| 29 | Coarse clothes | 161 | US$ 50.00 / ton |
However, up to now in practice quotas are allocated mainly on the basis of past export performance and quotas are awarded with preference to SOEs over foreign or domestic private enterprises. Such a policy represents a significant implicit subsidy to SOEs. In some occasion, small ¡V medium enterprises and those from more remote areas are given some preference. Private enterprises may apply for export quotas, but the application procedure are reported extremely tedious and protracted, and generally the best result is only very small volume. SOEs usually transfer subcontract of quota items to private enterprises, even though the output will be officially recorded as having originated from the SOEs. So that in practice the quota allocation procedures lack transparency and apparent discrimination against foreign and private enterprises. These problems discourage the entrance of much needed private capital into the industry and become a factor in the decision of some foreign enterprises to locate in other countries.
With rapid change in the structure of textile and garment industry, such a regime is not efficient. The relative competitiveness of different types of enterprises has changed fundamentally in the past decade. The past performance ¡V based quota allocation regime disadvantage medium and small enterprises. This regime does not guarantee that the most efficient exporter get sufficient quota. The reform of the current quota allocation system is particularly important to increase competition among different enterprises. The present system allows too much small gap for administrative discretion and rent ¡V seeking. A better method of allocation would be to auction quota. An auction system has two advantages. First, it would increase the efficiency of quota use. Secondly, it would enable the government to obtain quota rents.
Vietnam has only experimented quota auction system in 1999 for enterprises located in Hanoi and Ho Chi Minh city by using 20% of export quota value for several categories. It should say that an auction system will be efficient if it is based on a highly transparent procedures of administration. If such an arrangement can not be established, the case for auctions is greatly diminished.
4. Import and Export duties
Import and export tariffs were firstly introduced in 1988 with enactment of the Law of Import and export duties. Up to now taxes on trade of Vietnam are in period of completion to form an unique tariff schedule.
At present, in Vietnam tariff system is still complicated and changed frequently. Thus tariff and exemption can be obtained through negotiation, especially for SOEs. That impedes the competition and increases effort to lobbing activities.
For textile and garment industry the current structure of import duties is discriminated between sectors with higher tariffs are imposed on import of fabric produced by domestic enterprises and lower tariffs are imposed on import of items which are used for export production. The general structure of import tariffs is as follows:
0% cotton, synthetic fiber, filament, dyestuff, machinery
10 ¡V20% cotton and mixed yarn
40% woven fabric
50% garments
At the same time export tariffs imposed on export of textiles and garments are zero. That means the trade taxes for textile and garment industry combine the policy for industry protection with the policy for export promotion (in fact, the effective rate of protection for textiles is relatively high, around 142.7%). Here we will point out unreasonableness of the trade policy for the textile and garment industry:
- Firstly, unreasonable trade taxes encourage widespread smuggling of textiles and garments that make industry protection have no sense.
- Secondly, there can often be large differences in rates for the same products with different uses which result in much discretionary authority being placed in the hands of customs officials.
- Thirdly, the Law of import and export provides that export enterprises will not have to pay tax on their imported inputs using for export within a specified time (in 90 days prior to 1999, now in 9 months). The short time limit for re-exportation has caused a lot difficulties to the export enterprises.
- Finally, The export - import procedures are often complex and time - consuming. This is a great constraint for a highly trade intensive activity such as garments
IV. Investing Environment
In this sector, we will look at production factors as well as institutional environment for investment in Textile and garment industry in Vietnam.
1. Labour force
It can be said that, to a certain extent, Vietnam has plenty of labourers with good basic education for any investment. According to General Statistical Office (GSO), in the period 1990-1998, the labour force increased from 30.2 millions to 38.2 millions. Most of laborers work in agricultural, forestry and fishing sector, 22 millions in 1990 and 25.5 millions in 1998. Labour force increases annually 1 million (1.2 millions from 1996). Most of them have secondary education. State sector and foreign invested sector absorb 200,000 persons of them, about 1 million people have to find jobs in other sectors.
Unemployment is more and more serious problem. Of the total 38.2 millions people in working age, dozens of millions are under-employed and million jobless. Statistics show that unemployment in Vietnam was 6.88 percent in 1998, higher than the 6.01 percent of 1997, and 5.88 percent of 1996. The situation was worse in large cities: Hanoi and Haiphong had unemployment of over eight percent while HCM City was over six percent. Approximately 30 percent of rural inhabitants were jobless (a small drop compared to previous years). The rate of unemployment technical workers or those had to work in fields not corresponding to their areas of training was high (22.9 percent of technical workers are jobless), around 37 percent of university and college graduates could find jobs and just 45 to 50 percent work in fields corresponding to their areas of training.
Chart 2:Labourers in the Economy and in State Sector (Million persons)
(Source: General Statistical Office)
It is paradoxical that while Vietnam is in dire need of qualified technical workers, the rate of unemployed college and university graduates is high. Those technically and professionally qualified concentrate on administrative units and schools, (around 63 percent), while it is 32.7 percent in business and production units (against 48 percent in South Korea, 58.2 percent in Thailand, 64.4 percent in Japan, more than 69 percent in France and over 70 percent in the United States). Manual laborers still make up around 87 percent, similar to the situation in South Korea in the 1950s-1960s, and Taiwan in the 1960s. Laborers with technical and professional qualifications just account for 13.3 percent in Vietnam while it is between 40-50 percent in other regional countries, and as high as 90 percent in developed countries (Vietnam Economic News, No. 24, 12-15 June 1998).
Textile and garment industry is a labour intensive industry. (In fact, garment is more labour intensive than textile). The industry can employ more laborers and lessens the unemployment problem. In 1998, the number of employees in the Textile and garment industry in Vietnam is 500,000 that means only 1.3% of total labour force but 14.3% of labour force in manufacturing industries. (Source: Textile and garment Magazine No. 11-12/1998 and GSO). In the period 1991-1996, there were hundreds of new Textile and garment enterprises established that employ 30,000 - 40,000 laborers annually. In terms of labour resource, there are no constraints for development of the industry.
Creating one position in the garment industry requires just USD 600 - 700, and a garment enterprise with 400 workers requires only USD 500,000 in investment capital. Therefore, the industry is consider the number one priority in industrial development in numerous localities, and many provinces which do not have a garment industry, such as Quang Ninh, Tuyen Quang and Thai Nguyen are now also considering to develop this industry. The government encourages the establishment of more garment enterprises to create more jobs. (Vietnam's Economic News, No. 7, 1998)
However, lack of professional and technical laborers (especially in textile sector) is a constraint for expanding the industry. Only few universities have departments training engineers for the industry.
ƒx Hanoi Poly-Technic University with a Textile and garment department since 1988 educated 25 engineers.
ƒx Industrial Art University with a fashion department training fashion designers
ƒx Hanoi Open University with a specified sub-department training fashion designers.
ƒx HCM City Poly-Technic University with a Textile and garment department training Textile and garment engineers.
There are also some technical schools training technical workers in garment area: one in Gia Lam District, Hanoi City; one in Kham Thien Street, Hanoi City and another one in Thu Duc District, HCM City. Most of Cities/Provinces have training centers for garment activities. However, learners can only get very basic techniques from them. In addition, big Textile and garment enterprises have training section to training workers for their needs. The two last forms are non-standard with very short courses (normally, 1-3 months). Generally, Textile and garment industry lacks skilled labour. That is reason for the low productivity and high unit labour cost of the Textile and garment industry in Vietnam (although wages in Vietnam are very low in comparison to other countries).
Salary:
The government applies the minimum salary regulation that is effective in SOEs and foreign-invested enterprises.
According to Decree 26/CP dated May 23, 1993, the minimum salary level is VND 120,000 per month. Decree 06/CP dated January 21, 1997 increased this level to VND 144,000. This salary level was applicable to different State-owned enterprises and administrative entities. The improved salary regulation ended the State subsidy on SOEs, but maintained an relationship between salary stipulations applicable to enterprises and those subject to administrative entities, and therefore, did not create any impetus to stimulate enterprises to increase and develop their own production. To solve this problem, Decree 28/CP was issued with improved stipulations. Decree 28/CP permits enterprises to increase employee¡¦s salaries by 1.5 times or less over the minimum salary level stipulated by the State. The regulation implies to apply in whole economy, there are no differences between regions.
The regulation is not practical. According to a study of the Institute of Economics, the shadow wage (for full-time employee) is VND 250,000 per month. An effective regulation on minimum wage could not set up a level below VND 250,000 per month. In fact, minimum wage of a full-time employee is higher than the level set up by the regulation. Statistics show that the average salary for employees from eight ministries and general departments, 48 provinces and cities, and 28 corporations was VND 857,934 per month in 1997. This figure was VND 825,000 in 1998. (Vietnam Economic News, No. 11, 15-21 March 1999). In Textile and garment industry, according to a survey conducted by the Institute of Economics, the minimum wage of an unskilled labour is VND 290,000 per month, and the average wage - VND 700,000 per month in 1997, lower than the average level of the country.
For foreign invested enterprises, the minimum salary regulation is practical. According to current state regulations, the minimum salary level paid by foreign-invested enterprises is calculated in US dollars. The level, for businesses operating in Hanoi and HCM City, is US$ 45 per month; for those located in the second grade cities is US$ 40 per month; and for the remaining businesses is US$ 35 per month. Also according to Government regulations, employee salaries are specified in the contract in US dollars, but are paid in VN dong according to the inter-bank market exchange rate at the time of payment. This regulation is acceptable and has been implemented effectively over the last few years. In fact, the average wage in the foreign invested sector is US$ 65 per person per month.
2. Material production and consumption in textile and garment industry in Vietnam
In textile and garment industry, raw material plays an important role and determines product quality and production effectiveness. Vietnam¡¦s textile and garment industry consumes main materials: raw cotton, synthetic fiber, wool, jute, silk cord etc. of which raw cotton and synthetic are most important. So far, Vietnam can produce only cotton and silk cord for textile industry. However, domestic production of raw materials is far behind the demand for textile and garment production. Over 80% of the wide range of fabrics available on the local market currently are imported products. Vietnam has to import 100% of synthetic fiber and 90% of raw cotton for textile industry. The table below indicates figures of production and import of materials for textile and garment industry in Vietnam in the period 1991-1997. The Textile and garment industry depends heavily on imported materials.
Table 9: Textile Materials: Domestic Production and Import (1991-1997)
| Unit | 1991 | 1992 | 1993 | 1994 | 1995 | 1996 | 1997 |
Production:
- Silk Cord
- Cotton
- Fiber
- Silk
- Canvas
- Cotton Fabrics for
Mosquito Nets
- Cloth | Ton
Ton
Thous. ton
Mill. m
Thous. m
Mill. m
Mill. m | 780
2,860
40
280
1,870
43
280 | 980
3,930
44
272
2,131
86
272 | 1,419
1,680
38
215
2,419
91
215 | 1,483
2,240
44.4
228.1
1,997
89.9
228 | 1,442
4,080
50
221
2,058
46.1
221 | 1,129
4,525
56.9
281
2,269
30.9
281 | -
4,187
69.5
300
2,500
28.0
- |
Import:
- Cotton
- Polyester Thread
- Fiber
- Cloth
- Auxiliary materials
for Garment Industry
- Tools
- Dyeing Chemicals,
Solutions | Thous. ton
Thous. ton
Thous. ton
Mill. m
Mill. USD
Thous. USD
Thous. USD | 32.5
7.2
19.1
19.8
17.7
-
- | 8.3
16.7
25
28
55
17,870
6,150 | 16.4
11.8
35.3
27.5
96.2
34,806
9,551 | 19.9
22.0
64.9
54.1
152.3
40,000
10,000 | 68.2
-
93.8
71.7
304.6
-
- | 37.4
-
96.7
226.1
531.4
-
- | -
-
-
-
-
-
- |
(Source: GSO and VINATEX)
Vietnamese textiles currently satisfy only the consumption demand of rural and mountainous markets, and have not yet met the needs of urban outlets or garment enterprises. Even garment enterprises under VINATEX are not using fabrics made by local textile units, and up to 90% of materials for the production of export garments are imported from overseas. The major reason why the textile industry has not developed is the lack of development plan. At present, this industry produces around 500 million meters of fabric, consuming some 50,000 tons of cotton annually. Meanwhile the country only produces three to five thousand tons of cotton per year. In addition, locally-made cotton is low quality, resulting in substandard products. Therefore, to develop the textile industry, the State should have policies to develop material plantations, invest in equipment and infrastructure facilities, and at the same time realise investments in improving workforce to spur the textile industry¡¦s further growth. (Vietnam¡¦s Economic News, No. 8, 20-26 Feb. 1998)Cotton Production
Growing Cotton: Cotton cultivation is transferred from producing for central plan to producing for market and it is diversified products on cotton fields. In the period of 1991-1995, the government tried to maintain growing cotton field areas, it is focused on increasing productivity, raw cotton quality to increase effectiveness of fiber-cotton production. In that period, growing cotton field areas reduced 6% in comparison of those in the period of 1986-1990 (because of lowered cotton market in 1992). However, with its efforts, cotton productivity increased 2.2 times and created many potentials for cotton production. Although cotton production has increased over time, it is far to meet the domestic demand.
Table 10: Cotton Production in Vietnam
Period | | Productivity
(kg cotton seed per ha) | |
1976 ¡V 1980 | 8,371.4 | 307 | 838 |
1981 ¡V 1985 | 17,927 | 328 | 1,290 |
1986 ¡V 1990 | 11,180 | 354 | 1,286 |
1991 ¡V 1995 | 10,855 | 779 | 2,958 |
1991 | 11,624 | 703 | 2,860 |
1992 | 15,620 | 719 | 3,930 |
1993 | 6,330 | 759 | 1,680 |
1994 | 8,220 | 781 | 2,240 |
1995 | 12,550 | 933 | 4,080 |
1996 | 14,550 | 105 | 4,525 |
Source: GSO and VINATEX
Main achievements of cotton growing production:
„h Understanding ecological conditions, land requirement to determine land area for growing cotton
„h Determining suitable techniques for growing cotton in Vietnam: rational seasons, circle crops, effective crop protection, rational fertilizing.
„h Improving processing capacity and cotton quality.
„h Reorganizing production system to suit to market mechanism.
„h Creating new seeds, especially hybrid seeds with high productivity and good quality, generating possibilities for domestically supplying sufficient cotton for textile industry: In some areas, the hybrid seed was grown twice per year and gave an average cotton productivity of 1.5 ton per ha and in a good irrigation condition, the productivity reached to 2.5 - 3 ton per ha.
Economic result:
According to Central Cotton Corporation¡¦s calculation, break-even cotton productivity in Dong Nai province is 0.69 ton per ha, in Son La ¡V 0.84 ton per ha. Cotton productivity in all areas is higher than the break-even productivity. Growing cotton makes profits in all regions. The production effectiveness in Southern provinces is higher than that in northern provinces.
However, based on the estimation of provinces, especially of major areas growing cotton in Dong Nai and Dac Lac, there is a competitive advantage of growing cotton to other plants if cotton productivity is at least 1 ton per ha. The cotton hybrid seed has an obvious competitiveness because its average productivity reaches 1.3 ¡V 1.5 ton per ha.
Recommendations for growing cotton:
„h Vietnam has ability in producing cotton. Cultivated areas for growing cotton could be large if growing cotton has a competitive advantage with other plants.
„h Potentials of cotton productivity are large, especially with cotton hybrid seeds. Cotton can compete with other crops to expand cotton fields.
„h Central Cotton Corporation (CCC) contributed an important part to the achievements in the past years. However, to expand cotton areas and to obtain sustainable cotton production, the CCC should play a key role to reorganize cotton production sector as a united system for whole country in order to strengthen effectiveness of the sector.
Growing mulberry and silkworm production:
Although there were difficulties in the period 1991-1996, the sector of growing mulberry and feeding silkworm in Vietnam increased firmly in aspects of cultivated areas, raw silk output, and building up facilities and generating human resources for the next period.
1. Growing mulberry:
Mulberry is grown in 25 provinces and cities from North to South regions, form plain to mountain and high land areas. The mulberry growing area was only 4,700 ha in 1986. It increased significantly in the period 1991 - 1994: 17,469 ha (1991); 25,863 ha (1992); 30,793 ha (1993) and 31,534 ha (1994). However, since 1994, because of some reasons, the mulberry growing area decreased and in June 1996 it was 21,586 ha.
2. Silk-worm and silk cord production:
* Output: Raw silk output depends on mulberry growing area. The table below indicates that raw silk production increased from 980.7 ton in 1992 to 1,219 ton in 1993 and 1,483.7 ton in 1994. Since 1995 silk output has trended to decline (1,422 ton) because of reducing the area of mulberry. At an average price of USD 20,000 per ton, the output of this sector is just under USD 30 million per year.
* Quality: Vietnamese silk has yet to satisfy various quality standards due to low durability, and Vietnamese silk is difficult to dye. The quality of silk produced locally is lower than that made in China. Thus it cannot compete with that manufactured by industrialized countries such as Japan. In ranking, raw silk quality is below A level, mainly ranks from C to E level and un-ranked. The quantity of raw silk with exportable quality (at least with A level) accounts for a small proportion. A few of enterprises can produce good silk: some in Lam Dong province and others in Hai Hung province. Outputs of good raw silk (with the quality of A and above levels) were: 220 ton (22.5% of total raw silk output) in 1992; 314 ton (25.8%) in 1993; 212 ton (14.3%) in 1994; and 150.85 ton (10.5%) in 1995.
1. Machinery for silk processing:
Vietnamese silk is low quality mainly because it is produced manually (referring to all mulberry cultivation, unwinding and spinning stages. Total capacity for silk manufacturing is 1,870 ton per year, including 810 ton with automatic equipment and 1,060 ton with mechanical equipment.
* Machinery for silk processing:
Automatic equipment imported from Japan and South Korea are synchronous and are set up in enterprises in Lam Dong (with capacity of 610 ton) and Hai Hung (200 ton). Mechanical equipments are produced by domestic enterprises: Thu Duc Engineering Enterprise, Da Nang Engineering Enterprise, Institute of Agricultural Machinery, Institute of Economic and Technical Textile and garment, etc. Almost silk processing enterprises in provinces (except Lam Dong) are equipped unsynchronous, and there are no machines in some steps of production process, boiling, for example. They do not have enough equipments for controlling silk quality.
* Rate of using machinery: there is a situation of ineffectiveness in using machinery in enterprises.
In Lam Dong province, total capacity of enterprises is 1,065 ton per year, accounts for 57% of capacity of whole country. However, silk output of the province were very low compare to its capacity: 314 ton in 1993 (29,5% capacity), 211.6 ton in 1994 (20%), 185 ton in 1995 (17.4%). Similarly, enterprises in other provinces have low rate of using machinery: total capacity of these enterprises is 805 ton per year, but the output in 1993 was 180 ton (22.4% of the capacity), in 1994 ¡V 150 ton (18.6%). The silk quality of these enterprises is poor, mostly under A level.
4. Raw silk market:
Raw silk prices are unstable, mostly affected by dumping of China¡¦s silk. In the period 1995-1996, raw silk prices declined rapidly, it is hard to find markets for high quality raw silk. Therefore the sector faced difficulties, silk production and mulberry growing areas are down. Silk manufacturing enterprises could not buy enough silk-worm for their production.
In general, silk production in Vietnam is very small although it has potentials and high demand.
Table 11: Silk Cord Production in 1991 ¡V 1996
| 1991 | 1992 | 1993 | 1994 | 1995 | 1996 |
| A. Mulberry Growing Area (ha) | | | | | | |
| Whole Country | 17,469 | 25,683 | 30,793 | 31,354 | 21,556 | 24,567 |
| - Northern Provinces | 3,762 | 5,712 | 8,567 | 9,490 | 9,280 | 9,194 |
| - Southern Provinces | 2,557 | 2,823 | 2,982 | 2,646 | 1,895 | 1,548 |
| - High-land Provinces | 11,100 | 16,948 | 18,994 | 19,148 | 13,100 | 10,558 |
| - Other Provinces | 50 | 100 | 250 | 281 | 281 | 12 |
| B. Silk Follicle (ton) | | | | | | |
| Whole Country | 6,597 | 7,848 | 9,756 | 11,877 | 11,376 | 9,038 |
| - Northern Provinces | 1,841 | 2,406 | 3,796 | 4,247 | 4,070 | 3,938 |
| - Southern Provinces | 886 | 890 | 860 | 750 | 668 | 524 |
| - High-land Provinces | 3,850 | 4,500 | 5,000 | 6,780 | 6,528 | 4,466 |
| - Other Provinces | 20 | 50 | 100 | 100 | 110 | 110 |
| C. Silk Cord Output (ton) | 942.4 | 980.7 | 1,129.0 | 1,483.0 | 1,422.0 | 1,129.0 |
| - Silk cord produced by machine | 340.0 | 372.2 | 508.8 | 376.7 | 303.3 | 280.0 |
Source: GSO and VINATEX
3. Investment
In this part, investment in the industry will be considered from aspect of capital - factor of production.
Domestic Investment:
Lack of funds has been a common state for the textile and garment enterprises over the past years, regarding both working capital and investment capital for technology and equipment renovation as well as capital for new investments. In the period 1991-1995, the industry invested VND 1,484.6 billion (USD 135 million) including 419.3 billion dong of foreign loans (28%), 691.4 billion of domestic loans (47%), 340.5 billion of depreciation fund and other sources (22.3%), and 33.4 billion of investment capital from state budget (2.7%).
There are three main resources for domestic investment in the textile and garment industry in Vietnam: State resources, self-financed capital of enterprises, and bank loans.
State Resources:
The capital sources from the state accounts for only 20 percent of the 30 percent of the total granted capital as stimulated (i.e. accounting for only 6 percent of the total actual operating capital). In 1995 the government invested VND 189.9 billion (USD 17 million) in the industry (VND 170.6 billion for textile and 19.3 billion for garment), accounting for 2.7% of total state capital invested in industries. In 1996, the number jumped up to VND 726.2 billion (USD 56 million) included VND 510.4 billion for textile and 215.8 billion for garment. That made up 6% of total state capital invested in industries.
Self-financed Resources:
Enterprises' self-financed capitals account for only 10 percent of the total actual operating capital. The resources depend much on the performance of enterprises and financial policies of the government. VINATEX, a General Corporation consists of 52 enterprises as its members, produces about 60% of total output of the textile-garment industry. In two years 1995 and 1996, it invested VND 848.988 billion (USD 77 million) in 30 projects, (equals to 57% of investment capitals in five years 1991-1995), included VND 752.9 billion for textile and 96.2 billion for garment. In that period, VINATEX established 20 new garment enterprises that employ dozens of thousands labourers. (Industrial Magazine, No. 2+3, 1997). In 1997, the corporation invested VND 441 billion (USD 35 million) in 55 projects, including 18 garment Joint-ventures that generating more than 5,000 jobs. (Vietnam Economic News, No. 7, 13-19 Feb. 1998).
Bank Loans:
The major component of enterprises' investment capital is bank loans. In order to have access to loans, enterprises have to mortgage their assets. Although the State has recently loosened the regulation on borrowing without collateral, it is still difficult to obtain loans, especially with private companies.
On the other hand, the cost of capital is high, exceeding the consumer price index (CPI). In 1995 the CPI was only 12.7% compared to 20% of the interest rate; in 1996 CPI - 4.5%, interest rate - 14%. It resulted in a severe fact that the interest paid to the banks accounted for 50% of enterprises¡¦ profits. Some enterprises suffer losses because of high interest rate. For example, at the 8 March Textile Company the interest paid to the banks makes up 2/3 of its payroll, annually it pays both the principal and interest to the tune of VND 21 billion (42 VND billion in 1997). In 1997, the Company made a loss of VND 35 billions (about USD 2.7 million). Furthermore, bank loans are mostly short-term credits, the proportion of medium and long-term loans are very small. Thus, in necessary cases, enterprises have to use short-term loans for long-term investment.
The investment capital for technology renovation in the Textile and garment industry increased rapidly for 4 years from 1993 to 1997 (especially the companies for export). According to the Vietnam¡¦s General Textile and Garment Corporation, the number of garment units in HCM City that had renovated technology during 1993-1997, represented 83.6%, in average one unit had invested more than VND 4 billion (about USD 310,000) in production. But if compared to the developed countries with the investment rate of USD 2,000 per employee in garment businesses, the enterprises with high investment rate in Vietnam reach only half of that rate, i.e. under USD 1,000 per employee. Generally, the investment structure in the Textile and garment industry has remained irrational, some areas enjoy more investment while other no investment. Therefore, it has led to the situation where the machinery capacity is not fully exploited in some localities. For example, investment was made for 200 embroidery machines in HCM City in 1995, with 100 in surplus (waste of USD 10 million). The investment recipient-entities just like to acquire machinery in order to manufacture products of quick consumption such as shirts, jackets or pyjama etc. and very few companies are involved in manufacturing more high-end articles such as suits, lady¡¦s clothes. A specific evidence is that of the Vietnamese specimens with EU quotas many items have remained unregistered for production.
There have been enterprises that just focused on borrowing to invest in modern and expensive equipment, but their poor management has led to finished products with high price that are not able to compete with imported goods, or even loss-making business performance or leaking of the state capital and assets, such as Nam Dinh Textile Corporation and 8 March Textile Company.
Foreign Direct Investment in Textile and garment Industry
Foreign direct investment has played an important role in developing Textile and garment industry. In 1997, foreign invested sector exported USD 240 million Textile and garment products (about 18% of total export value of Textile and garment products).
Up to December 31, 1997, Vietnam has 189 Textile and garment projects with total registered capital of USD 1,817.69 million (accounted for 9.1% of projects and 5.3% of investment capital of total foreign direct investment in the economy). If excluding 36 pre-period disbanded projects with capital of USD 122.46 million, there remain 153 projects with total investment capital of USD 1695.05 million.
a. In Textile Sector:
There are 72 licensed projects with total investment capital of USD 1554.81 million. Some of them have been disbanded before the time term (12 projects account for about 15% licensed projects, with capital of USD 72.06 million - 4.6% of total registered capital). There now have been 60 implementing projects with investment capital of USD 1482.75 million. In details:
ƒx 34 projects for producing fiber, fabrics and knitwear.
Of which: 10 large scale projects in textile industry with synchronized investment from stage of producing fibers to printing stage and finishing (Pang Rim, Hoang De Long, Hualon, Tongkook, Chung Shing, Indo-vina, Samsung Vina, Choongnam Vietnam, Hyosung Vina, S.Y Textile).
ƒx 3 projects for silk production (Viet Trieu, Vietsintex, and Vikotex).
ƒx 3 projects for dying (Domatex, Bosun, SinoNova)
ƒx 4 projects for cotton towel production (Dona Bochang, Asc-Char Wie, Hai Van, Kent Wien).
ƒx 11 projects for woolen and rug production.
ƒx 5 projects for PP fiber and nylon fabrics.
The rate of capital disbursement of the projects is slow. The situation of 60 implementing projects are follows:
ƒx 41 projects (accounted for 63% total implementing projects) have disbursed USD 503.08 million of capital (make up 34% of total registered capital). They include:
- 5 projects are under construction.
- 36 projects (accounted to 56% of licensed projects) are operating and produce USD 329.89 million of revenues (export revenues took USD 227.97 million - about 69% of total revenues), created 17392 jobs. These enterprises have contributed USD 3,741,062 of revenue tax; USD 717,442 of profit tax; USD 2,398,477 of tariff and USD 3,731,392 of other taxes to the state budget (Source: Department of Foreign Invested Project Management, Ministry of Planning and Investment).
ƒx 2 projects, Samsung Textile Company, license No. 1268/GP issued 14/6/1995, with a capital of USD 192.692 million, based in Dong Nai province and Boin-Mania Wool Textile Company, license No. 1319/GP issued 17/7/1995, with a capital of USD 1.2 million based in HCM City, have not started yet, and will be considered to withdraw licenses before registered period.
ƒx 17 projects licensed in lately 1995 and in 1996, are now completing administrative procedures and preparing for construction.Table 12: Foreign Direct Investment in Textile Sector (up to 31 Dec. 1997)
| Total | 1990* | 1991 | 1992 | 1993 | 1994 | 1995 | 1996 | 1997 |
| Licensed projects | 72 | 5 | 3 | 8 | 10 | 10 | 14 | 13 | 9 |
| Withdrawn projects | 12 | 3 | 1 | 2 | 2 | 0 | 2 | 2 | 0 |
| Effective projects | 60 | 2 | 2 | 6 | 8 | 10 | 12 | 11 | 9 |
Investment capital
(USD mill.) | 1,470 | 15.35 | 9.41 | 27.39 | 534.9 | 108.3 | 377.0 | 184.0 | 213.6 |
| Average scale of each project (USD mill.) | 24.5 | 7.67 | 4.7 | 3.42 | 66.8 | 10.8 | 31.41 | 16.7 | 23.73 |
Note: (*) Projects in 1988 and 1989 are combined in year 1990.
Source: MPI
1. Capacity: Foreign invested sector adds a significant share to textile production capacity. Total capacity of the projects is follows: (up to the end of 1997)
- Various fibers: 210,000 tons.
- Cloth: 400 million m2.
- Knitting products: 12,000 tons.
- Cotton towel: 2,720 tons.
- Silk: 132 tons of silk cord and 1 million meter of silk.
- Woolen clothing: 1 million products.
- Textile machines: about 3500 machines
2. Investment Partners:
There are 14 countries investing in Vietnam¡¦s textile industry. The top 5 countries in terms of investment capital are: South Korea with 30 projects (about 50% of numbers of projects) and investment capital of USD 703.12 millions (45.6% total capital); Malaysia with 4 project and investment capital of USD 477.13 millions (30.9% total capital); Taiwan with 20 projects and investment capital of USD 200.73 millions (13% total capital); Hong Kong with 8 projects and investment capital of USD 56.58 million (3.7% capital); Liberia with 1 project and investment capital of USD 47 million (3% total capital).
Chart 3: Leading Countries Invested in Vietnam¡¦s Textile Sector
(up to 31 Dec. 1997 ¡V Total: USD 1,542 million)
(Up to 31 Dec. 1997 ¡V Total: USD 195.25 million)
Source: MPI
3. Investment Projects by Regions:
Garment foreign invested projects scatter in 19 provinces and cities but locate mainly in the South (84% of total projects and 96% of total capital). HCM City is the leading one with 42 projects and total capital of USD 87.16 million (51% of the total projects; and 44% of total investment capital). Dong Nai province is in the second position with 17 projects and USD 65.21 million of investment capital (20% of total projects and 33% of total investment capital). Binh Duong takes the third with 10 projects and USD 37.5 million of investment capital (12% of total projects and 19% of total investment capital). The fourth belongs to Hanoi City with 10 projects and investment capital of USD 15.84 million (12% total projects and 8% total investment capital).
4. Capital Increasing to Expand Production:
During operation time, companies either run effectively or renovate technology, have registered to increase investment capital. There were 27 enterprises that have adjusted and increased operating capital by USD 43.445 million to expand their production.
5. Causes of Disbanding Projects before Registered Period:
- Financial constraint of foreign partners.
- Ineffectiveness in operating the business (For example, Rostipex Joint Venture with license No. 158/GP issued 25/1/91 and Hanjoo - Viet Thang Joint Venture with license No. 285/GP issued 6/12/91.)
- There are unsolvable interest disagreements between partners (For example, Hoa Viet Join Venture with license No. 386/GP dated 15/7/1992 at Hai Phong City).
- Vietnamese partner is disbanded by Government Decision of Re-establish State-Owned Enterprises. (In case of Sasagan Join Venture with License No. 58/GP).
- Vietnamese partner bought foreign partner¡¦s stake to transform to a form of State-owned enterprise (in case of Vitexco Garment Joint Venture with License No. 18/GP).
- The project has not been implemented. (the case of Daewoo ¡V Dongnai Garment Company, license No. 512/CP).
6. Comments:
- Projects in garment industry have small or medium scales, average size of a project is about USD 2.38 million.
- Projects are implemented mainly with the form of 100% foreign - invested (64.6% of total projects), and the form of joint ventures accounts for 35.4%.
- Investors mainly come from Asian countries. Taiwan is the leading country (30%) followed by South Korea (24%).
- Efficiency of these investments is low because companies mainly produce for export processing contracts.
- In general, equipment and technology of foreign invested companies are modern, better than those of domestic enterprises (for example, some foreign invested enterprises installed automatic embroidering machine, automatic cutting machines, synchronized lines for producing shirts, trousers and jackets). Some enterprises with well-known trade mark (Triumph, Van Lac, etc.) have produced high value and sophisticated products, achieve good performance.
- FDI in garment industry generate many jobs for the economy.
- Markets for garment products are a severe problem. Garment quotas is not adequate to capacity of enterprises, resulting the low efficiency of investment.
- Vietnam¡¦s garment products face strong competition from imported products (especially, smuggling).
c. In Accessories
There are 12 projects producing supplements to garment industry (thread, thread for embroidering, button, soft panel) with investment capital of over USD 41.44 million. In which, there are five 100% foreign-invested projects with capital of USD 19.64 million and seven joint venture projects with capital of USD 21.79 million.
Capacity:
- Threads: 2,720 tons.
- Cotton cloth (unwoven cloth) 28 million meters per year.
- Other supplements (button and zipper, etc.) USD 2 million.
In general, these projects are operating on the right track, and they meet market demands. The following figures indicate their performance: USD 24.73 million have been operating, revenues of USD 66.76 million, USD 25 million of export value, USD 1.15 million of turnover tax, USD 629,000 of profit tax, USD 21,000 of tariff and over USD 2 million of other taxes, 1,303 laborers employed.
Capital Demand for Future Development
The Textile and garment industry will need some USD 600-700 million for in-depth investment and another USD 5.7 billion for investment technology renovations. As much as 90 percent of this amount is earmarked for the textile sector. From there, the existing 800,000 spindles which have been used for over 20 years will gradually be replaced and 400,000 spindles which have been used since 1979 will be upgraded with supplemental investments to improve the quality of fiber for the production of knitwear and top-grade fabrics. Half of the existing 7,000 outmoded textile machines will also be gradually replaced. According to VINATEX's plan, 65-70 percent of the $ 5.7 billion investment will come from overseas loans and just 25-30 percent from domestic sources.
However, forming an effective investment strategy can be an enigma for business managers, and most figures in the investment projects are simply estimates. For Vietnam's textile sector, changing the investment structure and implementing technological renovations have become imperative demands but not every business will be successful in this process.
Table 14: Capital Demand for In-depth Investment 1997-2010 (Million USD)
Industry | 1997
to 2000 | 2001
to 2005 | 2006
to 2010 | Total |
| A. SOEs in Textile Sector | 121.7 | 170.5 | 112.655 | 404.855 |
| 1/ Co Fiber, Pe/Co, Pan…cell 40.0 | 55.0 | 38.958 | 133.958 | |
| 2/ Plunging Textile | 35.0 | 50.0 | 36.792 | 121.792 |
| 3/ Printing and Dyeing + Trimming | 31.0 | 37.0 | 23.926 | 91.926 |
| 4/ Towel: Weaving + Dyeing + Sewing | 3.0 | 6.0 | 1.350 | 10.350 |
| 5/ Knitwear: Weaving + Dyeing + Sewing | 10.0 | 19.0 | 0 | 39.0 |
| 6/ Veiling: Weaving + Dyeing + Sewing | 1.2 | 1.0 | 1.0 | 3.2 |
| 7/ Socks: Weaving + Dyeing + Trimming | 1.5 | 2.5 | 0.608 | 4.608 |
| B. Non-SOEs in Textile Sector | 6.0 | 9.0 | 6.145 | 21.145 |
| C. New Investment in Textile SOEs | 60.0 | 123.0 | 100.0 | 283.0 |
| D. Investment in Garment Sector | 15.8 | 17.1 | 15.0 | 47.9 |
Total | 203.5 | 319.6 | 233.8 | 756.9 |
Source: VINATEX
Resources of investment capitals:
- Retained profits of enterprises
- Depreciation funds
- Shares (from various shareholders)
- FDI from foreign partner
- Contribution from the government, if the business is a SOE
- Borrowings (Domestic or foreign, banks)
- Contribution in kinds, machinery
- Borrowings at low interest rates from ODA, NGO
4. Institutional environment for investment
Laws on Investment:
To encourage investors and mobilize resources for development investment, the government has issued "Law on Foreign Investment" and "Law Encouragement of Domestic Investment". They have created good environment for investment.
Law on Foreign Investment:
Vietnam's Law on Foreign Investment was first promulgated in the late 1987; it underwent amendment for the first time in 1990, and for the second time in 1993; then on November 12, 1996 it was amended for the third time by the National Assembly. Each amendment reflected the actual situation at that time, demands of Vietnam and its policy on inducing FDI. The Law is accompanied by several Governmental Decrees/Decision and Ministerial setting detailed regulations/guidance on investment activities.
In an effort to attract FDI capital the Government has created several incentives concerning tax and land lease rates which are specified for each investment field. One such incentives stipulates that an investor who makes re-investment in encourages projects will enjoy project tax return that are partly or fully equal to the projects which they use for re-investment. The return rates will depend on fields, locations, forms and duration of re-investment. (Articles 42 of the Foreign Investment Law in Vietnam)
Articles 59 of Governmental Decree 12/CP dated February 18, 1997 provides detailed regulation on how the Foreign Investment Law in Vietnam will be implemented. It stated that if foreign investors use their shared profits for re-investment, they can enjoy a sum of profit tax return which is equal to the sum paid for the re-invested profits.
The Profit tax return rates are stipulated at 100%, 75% and 50 percent for re-investment projects based on the following criteria:
- export at least 50 percent of their products
- employ more than 500 labourers
- invest in agricultural, forestry and fishery growing and processing
- use advanced technologies
- grow long-term crops
- forest planting
- use local raw materials available in Vietnam
- construct infrastructure
- invest in localities with difficult natural and socio-economic conditions.
There are many foreign invested enterprises getting benefits from this regulation. Some of them are Textile and garment enterprises: Choongnam Viet Thang Textile Joint-venture with Viet Thang Textile Company as Vietnamese partner, Coast Total Phong Phu Sewing Thread with Phong Phu Fibre Company as Vietnamese partner and Visingpack Joint-venture.
To encourage new companies to come to Vietnam, in Decree 53/1999 QD - TTg dated 26 March 1999, the government decided to reduce excessively high business licensing fees (repesently stands at two percent of the total value of the premises and equipment) as well as reducing the fee for establishing representative offices (presently at USD 5,000) to a more reasonable level (just enough to cover administrative management). In addition, no additional fee will be charged on the extension of representative office operation. Fees and charges impose improperly and beyond competence by different authority levels are to be abolished.
New regulation on wages and salaries for Vietnamese employees working in foreign invested enterprises (FIEs) are also expected to improve the competitiveness of the Vietnamese market compared with other countries in the region, where the currencies have significantly been devalued since 1997. The minimum wage will be determined and paid in VND instead of US dollars as currently regulated. However, to protect the employees' interests, the minimum wages and salaries can be adjusted if the consumption price index increases by more than 10 percent.
Up to now, FIEs have to pay higher prices for some inputs and services compared with domestic enterprises. By the Decree 53/1999, the government has decided to gradually deal with the dual price system currently applied to domestic enterprises and FIEs. Service cost, fees and charges in most cases will be calculated and paid in Vietnamese dong.
From July 1st, foreigners will enjoy the same price for clean water supply, telephone installation and the same entrance fee to cultural places as Vietnamese. Electricity rates will be reduced from 8.3 cents per kWh to 7.5 cents and international calls from Vietnam will be reduced by 10 percent.
Given the transitional period of the national economy and the difficulties faced by enterprises operating in those services, the Government promised to draw a road map to a common pricing system. The price reduction for these services in the year 2000 will be decided later.
Law on Encouragement of Domestic Investment:
Law on Encouragement of Domestic Investment was first issued in 1994 and amended in 1998. It aims to warm up the domestic investment environment and enhance the mobilization of domestic forces. It is also aimed to correspond with the policy on foreign investment and pave the way for a unified law on both domestic and foreign investment in the future. Under the Domestic Investment Law, domestic enterprises can also get benefits form many incentives such as cheap land rent, tax holidays for new investments, tariff exemption on capital goods for export production, lower tax rates. Some notable points of the Law are follows:
Article 2 of the Law states that three modes of investment: Build - Operate - Transfer (BOT), Build - Transfer - Operate (BTO) and Build - Transfer, all of which are widely applicable for domestic investment, will be prioritized and encouraged by imposing necessary measures aimed at quicker capital withdrawal and fast transfer to the State to benefit both investor and the State. The article also covers issues regarding Vietnamese residing overseas and foreigners permanently residing in Vietnam, as well as localities facing extremely difficult socio-economic conditions.
Investors in projects within the scope of investment preferences are subject to 50 percent exemption of land-use charges in cases where land is transferred to investors and they must pay land-use charges (Article 18). Land-use tax is also cut by half in the first three to ten years for investment in localities encountering socio-economic difficulties, and investors are exempt from land-use tax in the first five to ten years when they locate their projects in particular poor areas (Article 19). Industrial zones (IZs) and other special economic zones situated in such areas and using the ground for production and business are fee from land charges during their entire operation (Article 20).
Regarding preferences of corporate tax, Article 23 increases the duration of tax exemption levied on projects subject to such preferences. For projects located outside areas coping with unfavourable economic conditions, corporate income tax is reduced by half in an additional one to two years. Investment projects in difficult localities are exempt for an addition year and receive a 50 percent reduction in corporate tax for three more years.
To boost exports, the Law also gives corporate tax preferences as bonuses for businesses that are able to export for the first time or find new export markets, and corporate tax imposed on export profits is reduced by half. Business that either export large amount of products or have stable export markets are subject to 3-5 percent corporate tax rate reduction levied on export profits. In cases when export value is higher than in the previous year, corporate income tax on export profits is cut by 50 percent.
The Law also additional preferences. Article 24 states, "Investors who contribute capital through intellectual property rights, technical know-how and technological process will be given an exemption of the income tax which is earned from this contribution".
Although the Law on Encouragement of Domestic Investment has been passed, many domestic investors are still complaining about the large differences that remain between domestic and foreign investment, which in different cases favour either domestic or foreign investors. As stipulated, foreign-invested businesses (not including petroleum) are subject to four profit tax rates of 10%, 15%, 20% and 25%, while domestic business to only three tax rates of 25%, 35% and 45%. Foreign -invested businesses are exempted from import tariffs levied on machines and equipment used for forming fixed assets, in the meantime domestic business may only have their import taxes reduced or exempted when necessary. However, foreign business must not establish joint-stock or limitless operations. While local investors are given land and are enable to lease land, foreign investors can only lease land. Moreover, domestic businesses are exempted from luxury tax, but foreign-invested businesses must, however pay it, as well as tax on transferring profits abroad. Currently, They are also obliged to pay higher bills for some types of goods and services like electricity, telephone and transport, the rate for which are fixed by the State.
Differences in Policies with Respect to
Domestic and Foreign Investment
(Up to February 1998)
With respect to Domestic investment | With respect to Foreign investment |
| 1. Types of enterprises | |
| + Allowed to set up multi-purpose and multi-project companies | + Allowed to set up limited liability companies with one specific investment project for each. Not yet allowed setting up multi-purpose and multi-project companies. |
| + Allowed to set up limited liability private companies or limited liability companies | + Only allowed to set up limited liability companies. |
| + Allowed to set up joint-stock companies for mobilizing domestic capital resources | + Not yet allowed to set up join-stock companies for mobilizing domestic capital resources. |
| 2. Investment license and permit to set up enterprises: | |
| + Required to seek permission for setting up the enterprise, thereafter to perform procedural work on business registration | + Only required to apply for an investment license |
| 3. Land as floor space for business activities | |
| + Land is allocated by the State or allowed to rent land | + Can rent land from the State or locates on the land of the domestic partner (for Joint-ventures) |
| + Lower land rent | + Higher land rent |
| + In some cases, land rents are reduced or even exempted | |
| + State enterprises are allowed to contribute capital by means of land usage right | |
| 4. Turnover tax | |
| + May enjoy 50% turnover tax reduction for a maximum period of 4 years (valid up to the end of 1998, VAT will be applied from beginning of 1999)* | |
| a. Tax rates: | |
| - 3 rates of profit tax: 25%, 35% and 45% | - 4 rates with respect to both profit tax and corporate income tax: 10%, 15%, 20%, and 25%** |
| - A uniform rate for corporate income tax (32%), and in special case the government can apply rates: 15%, 20%, and 25% (Law on Corporate Income Tax, articles No. 1)** | |
| b. Reduction, exemption: | |
| - May enjoy tax exemption for 14 years to the maximum and thereafter 50% tax reduction for 9 years | - May enjoy tax exemption for 9 years to the maximum from the day enterprise starts making profits. |
| c. Basis for calculating tax: | |
| - May enjoy 50% reduction in the period of fixed-assets depreciation with respect to production processing and assembly of foods for export (Decree No. 7, Articles 29-3) | - May enjoy reduction from taxable income all donations for humanitarian purposes to Vietnamese organization and individuals. |
| d. Tax on additional income: | |
| - In addition to corporate income tax, must pay tax on additional income (25%) on account of income accruing thanks to objective advantage (Law on Corporate Income Tax, Articles No. 10-1). | |
| 6. On import tax: | |
| + Enjoy import tax exemption for raw materials for export production | + Enjoy import tax exemption for raw materials, for 5 years, with respect to projects operating in highland and remote areas (Decree No. 10, Articles 10-3) |
| 7. On personal income tax: | |
| + Initial taxable income level: 2 million VND (for Vietnamese)*** | + Initial taxable income level: 5 million VND (for foreigner)*** |
| + May enjoy tax exemption for 3 years with respect to income deriving from capital contribution to the enterprises | |
| 8. Remittances of profits to foreign countries: | |
| + Tax rate of 5% applied to Vietnamese residing in foreign countries | + Tax rates: 5%, 7% and 10% |
| 9. Other tax regulations: | |
| + Some projects may enjoy 50% tax reduction with respect to natural resources (except for oil and gas) for a 3-year period (Decree No. 7, Article 88). | |
| 10. Price of inputs: | |
| + must pay higher prices for transports, housing, water and power supply, postal and telecommunications services**** |
| 11. Wages and salaries: | |
| + Worker¡¦s minimum wage: VND 144,000 (equivalent to US$ 11) | + Minimum wages: US$ 35-45 (US$ 35 for businesses in rural areas, US$ 45 for businesses in Hanoi and HCM City) |
| 12. Other preferential treatment: | |
| + Projects which enjoy state encouragement can obtain medium-term and long-term loans with preferential interest rate or can receive state subsidies through the National Investment Support Fund for compensating a part of the interest rate payment (Decree No. 7, Articles 14-3). | |
| Export enterprises that face difficulties may receive state price support through the Price Stabilization Fund. | |
(Source: From a symposium on Encouraging Domestic Investment, held in Hanoi on February 18, 1998)
Notes:
* According to the VAT Law, No. 02/1997/QH9 issued on 10 May, 1999, Turnover tax has been replaced by VAT since 1st January 1999. There are three rates of VAT: 0% (for export activities), 5% (for almost normal business activities), 10% (for precious stone, hotel and tourism).
** According to The Corporate Income Tax Law issued on 10 May 1997, Profit tax has been replaced by Corporate tax since 1st January 1999. The rate of Corporate tax is 32% for all kinds of organizations
*** In 1998, regulation on personal income tax was changed: Initial taxable income level for Vietnamese increases to 2.5 million VND, and for Foreigner - 7 million VND.
**** According to Decree No. 53/1999 - QD - TTg dated 26 March 1999, since 1st July 1999, government will applied single price system to all businesses for transportation, local calls, water. The rates of power, international calls and land rent will also reduce (by 10%). Many fees, such as business registration fee and other fees set up by Ministries or Provinces, will be cut or removed.
V. FUTURE OUTLOOK OF THE INDUSTRY
According to the general plan for development of textile and garment industry, up to year 2010 overall objectives of the industry are as follows:
„h The industry has to meet the demand of more 100 million Vietnamese in 2010.
„h The rate of growth of industry is 13 percent annually up to 2005, from 2005 to 2010 it is 14 percent annually.
„h Up to 2010, the industry apply advanced technology, equivalent to present level of Hong Kong, Thailand (1997).
„h The industry employs about 2 million people in 2010 with income per capita of US$ 100.
Based on the overall objectives, the industry design the concrete objectives in production and export in the period 2000 - 2010 (see table 15, 16, 17)
Table 15: Export objectives up to 2010
Million USD
| Actual 1995 | 2000 | 2005 | 2010 |
| Export value | 750 | 2,000 | 3,000 | 4,000 |
| Of which: Garments | 500 | 1,630 | 2,200 | 3,000 |
| Textiles | 250 | 370 | 800 | 1,000 |
(Source: VINATEX)
Table 16: Objectives of fiber and cloth production
| No. | Product | 1995* Output | 2000 | 2005 | 2010 |
| | | Mill. m2 | Ton | %Mill. m2Ton%Mill. m2Ton% |
| A/ | Thread (Cotton,
Pe/Co, etc.) | 59,200 ton | | 100,000 | 170,000250,000 |
| B/ | Cloth | | | | |
1 | Woven Cloth | 265.3 Mill. m | 600 | 90,000 | 601,000150,00061.71,500225,00062.5 |
| - Cotton | | 240 | | 400600 |
| - Pe/Co | | 180 | | 300450 |
| - Pe | | 180 | | 300450 |
2 | Cotton Towel | 15,000 ton | | 25,000 | 16.732,00013.2 -40,00011.0 |
3 | Knitting Products | 22,000 ton | | 27,000 | 18.0 -45,00018.570,00019.5 |
| - Rounded Knitwear | | | 21,000 | 33,00052,000 |
| - Straight Knitwear
(Tuyn, curtain) | | | 5,000 | 10,00015,000 |
| - Socks | | | 1,000 | 2,0003,000 |
4 | Unwoven Cloth | - | | - | -4,0001.710,0002.8 |
5 | Other Textile Products | - | | 8,000 | 5.3 -12,0004.9 -15,0004.2 |
Total Cloths | 600 | 150,000 | 100 | 1,000 | 243,0001001,500360,000100 |
ƒx - 1995 Output: Including products from domestic enterprises and foreign invested enterprises
ƒx - Production capacity of Vietnam¡¦s textile - garment industry and FDI by 30 December 1996
ƒx - Equivalent: 1 m2 cloth = 1.33 m (standard) cloth
ƒx (Source: VINATEX)
Table 17: Garment production objective up to 2010
million unit.
| 1996 | 2000 | 2005 | 2010 |
| Garment product: | 199 | 350 | 480 | 720 |
Of which:
- Export | 101 | 210 | 310 | 420 |
| - Domestic use | 98 | 140 | 170 | 300 |
| Knitted product: | 30 | 70 | 150 | 210 |
Of which:
- Export | | 45 | 110 | 150 |
| - Domestic use | | 25 | 40 | 60 |
Source: VINATEX
In order to achieve above presented objectives Vietnam should have proper policy for development of the textile and garment industry. Vietnam¡¦s comparative advantage lies in the labor intensive garment and fabric sectors based on its low cost, diligent and skillful labor force. However, since Vietnam is still new to garment export, its labor force is said to be limited in experience and requires constant guidance and monitoring. Vietnam¡¦s technical capabilities are to be developed in the future. On the other hand, Vietnam has comparative disadvantage in capital intensive fiber sector. In the increasingly liberal trade environment of the region, Vietnam will have to pursue a development strategy more biased to the down ¡V stream sector than other East Asian countries have pursued in the past. The garment sector has to expand subcontracting activities. It would be wise encourage rather than discourage these activities, as they will make Vietnamese workers and enterprises to accumulate experience on which future developments will take place. At the same time, it is necessary to take following measures in order to shift gradually to doing business in pattern of FOB:
„h Development of transportation infrastructure such as port facilities and speeding up of custom clearance
„h Support for access to overseas markets
„h Establishment and support of Fashion Institute and design centers
„h Improvement and modernization of the domestic distribution system.
At the same time, Vietnam should strengthen linkages among the up ¡V stream, mid ¡V stream and down ¡V stream sectors. The basis approach to enhancing linkage in the textile and garment industry is backward integration from the down ¡V stream sector to the mid ¡V stream sector and then to the up ¡V stream sector. The expansion of the garment sector should be the foundation for upgrading the entire garment and textile industry. Vietnam should develop the relatively labor ¡V intensive fabric sector on the large demand from the most labor ¡V intensive garment sector and then finally move to the capital ¡V intensive fiber sector. Investment in capital ¡V intensive fiber production is difficult for Vietnam and should be pursued with a long ¡V term perspective. Thus Vietnam probably continue to require tariff protection for a limited period to attract investment in such capital ¡V intensive project. However, it should be recognized that such tariff protection will become impossible according to CEPT rules under AFTA. At the same time Vietnam should offer favorable environment for foreign investments, because the main driving force of such development is foreign direct investment.
VI. CONCLUSION AND RECOMMENDATIONS
To conclude, Vietnam¡¦s textile and garment industry has achieved impressive success over the past decade. It has managed to make the transition from a command economy oriented heavily towards the Former Comecon Block to a market oriented one strongly integrated within the East Asian region. The most important elements of this achievement, apart from a fundamental shift in the product strategy of the world economy, are macroeconomics stabilization, trade liberalization of the economy, microeconomics foundation for industrial development, as well as institutions and policies that constitute the environment in which textile and garment enterprises operate.
It need to be emphasized that there are obvious obstacles to achieve higher levels of growth, employment and efficiency of textile and garment industry in the future. The following recommendations are made to surmount these obstacles of the industry.
1. Create equal environment for enterprises of different sectors. Some of the changes are required:
„h Removal of indirect subsidies for SOEs in term of access to land and credit and in term of quota allocation;
„h Improving accounting and auditing system;
„h Making taxation policy more transparency and less complicity;
„h Administrative and trade reforms;
„h SOE management reform;
„h Liberalization of the private sector activities;
2. Design proper strategy for development of textile and garment industry. That is the expansion of the garment sector should be the foundation for upgrading the entire garment and textile industry by strengthening backward integration.
3. Import protection for the industry should take a form of lower tariff rate (present effective rate of protection for textile is relatively high, about 142 percent) and consistent with Vietnam¡¦s obligation to AFTA, APEC and WTO.
4. The process of quota allocation should be reformed for optimal utilization of quotas and increase competitiveness among enterprises. The auction system of quota allocation is good option for this reform. And Vietnam should have an effective administrative agency with highly transparent and predictable procedure.
5. Export orientation is strategy should be stimulated. However, the industry should not slight domestic market. Occupation of domestic market should be raised as important objective of industry development. At the same time, the government should set up economic and administrative measures to deal with smuggling textiles and garments in Vietnam.
6. Vietnam is labor intensive and capital scarce country. In order to take advantage in labor force, textile and garment enterprises should choose appropriate technology to invest in Vietnam condition for development. Applying new technology, which improves quality of product, reduces the cost as well as uses plentiful labor resource should be concerned by the enterprises. On the other hand, the industry should have strategy for technology renovation in order to use new technology more effectively.
7. Speed up the process of equitization for structural adjustment in the industry. The role of this equitization is to raise effectiveness of the economy as well as to mobilize the capital to invest in technological renovation to develop the industry.
8. Establish a single, demand ¡V driven, industry ¡V responsive association of the industry. It play as the channels of communication between the industry and the Government.
REFERENCES
1. Annual reports of VINATEX (internal documents)
2. Center for international Economics, 1998, Vietnam Trade policies in 1997.
3. Emiko Fukase and Will Martin, 1998, The effect of the U.S. granting MFN status to Vietnam. World Bank.
4. General plan for development of textile and garment industry ¡V VINATEX (internal document).
5. Lynn Salinger, 1998, Evolution of global manufacturing, current development, qualitative competitiveness analysis, and examples of prices distortions¡¦. U.S.A.
6. Nguyen Thi Thanh Ha & Pham Thi Nga, Competitiveness among industrial enterprises ¡V a survey in the garment and textile industry. Journal: Economic studies, No 9, 1996.
7. Seiichi Masuyama, June 1997, Policy options for development of garment and textile industry in Vietnam. Nomura Research Institute
8. Tran Thi Bich Ngoc, The Vietnamese textile and garment industry in the textile and garment system of the world. Journal: Economic studies, No 4, 1996.
9. Tran Van My and Nguyen Hong Son, 1998, Vietnam's Garment and textile Industry: Facts, Policies and Prospects, Vietnam Economic Review, No. 3, Jan. 1998.
10. Vietnam's economic News, Issues in 1997, 1998 and 1999.
11. Vo Dai Luoc, 1997, Vietnam trade and investment policies. VNCSSH ¡V Institute of World Economy.
12. Vo Dai Luoc, 1998, Trade & investment policies and development of some main industrial branches in Vietnam. VNCSSH ¡V Institute of World Economy. Hanoi.
Directory of textile and garment companies in vienam
Garment Export Group
List of Garment Companies exporting to EU
1. Hanoi City:
SOEs
1/ Hanoi Manifacturing and General export-import Company (HAPROSIMEX)
Address: 22 Hang Luoc St., Hanoi City.
Phone: 8251197. FAX: 8264014
Activity: Garment and Trading
2/ Hanoi 19/5 Garment Company
Address: 203 Nguyen Huy Tuong St., Thanh Xuan Sub-District, Dong Da District, Hanoi City.
Phone: 8584616, FAX: 8585392
Activity: Garment
3/ Hanoi Youth art and Garment Company (HAGASCO)
Address: K3B Thanh Cong Resident Quarter, Ba Dinh District, Hanoi City.
Phone: 8351290, FAX: 8353163
Activity: Garment
4/ Hanoi art and EXPORT-IMPORT Company (ARTEX Hanoi City.)
Address: 42B Cau Giay St., Tu Liem St., Hanoi City.
Phone: 8344589, FAX: 8344796
Activity: Garment and Trading
5/ Hanoi art manufacturing and export Company (HANATEX)
Address: 150 Hue St., Hanoi City.
Activity: Garment and Trading
6/ No. 40 Garment Company
Address: 80 Ha Dinh St., Thanh Xuan Sub-District, Dong Da District, Hanoi City.
Phone: 8584303. FAX: 8584864
Activity: Garment
7/ Thanh Cong Garment export Company (HAXENTEX)
Address: Lane 46, Nguyen Luong Bang St., Hoang Cau Sub-District,, Dong Da District, Hanoi City.
Phone: 8514449, FAX: 8513496
Activity: Garment
8/ Hoan Kiem EXPORT-IMPORT Company (HOAKIMEX)
Address: 126 Hang Trong St., Hoan Kiem District, Hanoi City.
Phone: 8263500. FAX: 8259228
Activity: Garment
9/ Hanoi EXPORT-IMPORT and investment Company (UNIMEX Hanoi City.)
Address: 41 Ngo Quyen St., Hanoi City.
Phone: 8264159. FAX: 8259246
Activity: Garment and Trading
10/ Thang Long Knitting Company
Address: 46 Hang Quat St., Hanoi City.
Phone: 8257570. FAX: 8257571
Activity: Knittwear
11/ Tu Liem Manufacturing and Export-import service Company (TULTRACO)
Address: 48 Cau Giay St., Tu Liem St., Hanoi City.
Phone: 8343887. FAX: 8345696
Activity: Garment and Trade Services
12/ Hanoi trade and Garment Company (HACAREDCO)
Address: 27 Thai Thinh St., Dong Da St., Hanoi City.
Phone: 8533803. FAX: 8534237
Activity: Garment and Trading
13/ Hong Ha EXPORT-IMPORT Company
Address: 4 Tan Ap Commune, Phuc Xa Sub-District, Ba Dinh District, Hanoi City.
Phone: 8293373. FAX: 8293175
Activity: Garment and Trading
14/ Winter Woolen Company
Address: 45 Nguyen Tuan Rd., Hanoi City.
Phone: 8585098. FAX: 8582061
Activity: Woolen Clothing
Limited Liability Companies
15/ Hanoi Manufacturing export Product LIMITED Company (HEPRO Co. Ltd)
Address: 40A Truong Chinh Rd., Dong Da District, Hanoi City.
Phone: 8694788. FAX: 8524853
Activity: Garment
16/ Nghi Tam Investment and tourism service Company (REXTOVTEX)
Address: 2 Lang Trung St., Dong Da District, Hanoi City.
Activity: Garment and Services
17/ Thang Long Company (TALIMEX)
Address: 58 Giang Vo St., Hanoi City.
Phone: 8230005. FAX: 823005
Activity: Garment
18/ Vinh Phat LIMITED Company
Address: Duong Block, Yen Vien Town, Gia Lam District, Hanoi City.
Phone: 8271484. FAX: 8631411
Activity: Garment
20/ Nam Son LIMITED Company
Address: Kim Au Commune, Dang Xa Sub-District, Gia Lam District, Hanoi City.
Phone: 8765734. FAX: 8766288
Activity: Garment
21/ Long Giang LIMITED Company
Address: 23 Minh Khai St., Hanoi City.
Phone: 8621382. FAX: 8621115
Activity: Garment
22/ Tien Bo Industrial Cooperative
Address: 44 Le Ngoc Han St., Hai Ba Trung District, Hanoi City.
Phone: 8262906. FAX: 8262906
Activity: Garment
23/ Nguyen Hoang Munifacturing and export service Company
Address: 45 Quang Trung St., Hanoi City.
Phone: 83404823. FAX: 8360523
Activity: Garment and Trading
24/ Minh Tri LIMITED Company
Address: Ba Hang Commune, Linh Nam Sub-District, Thanh Tri District, Hanoi City.
Phone: 8622802
Activity: Garment
25/ Thang Long LIMITED Company
Address: 4B Ton That Thiep St., Ba Dinh District, Hanoi City.
Phone: 8359141
Activity: Garment
26/ Hoang Mai LIMITED Company
Address: 23D Phuc Tan St., Hoan Kiem District, Hanoi City.
Phone: 8242795
Activity: Garment
27/ MY Anh LIMITED Company
Address: 242 Lo Duc St., Hanoi City.
Phone: 8219552
Activity: Garment
28/ Hai Ba Trung EXPORT-IMPORT Company
Address: 81 Lac Trung St., Hai Ba Trung District, Hanoi City.
Phone: 6360228
Activity: Garment and Trading
29/ Nam Thanh LIMITED Company
Address: 33 Ton Duc Thang St., Hanoi City.
Phone: 8232326
Activity: Garment
30/ Dong Xuan partnership Company
Address: 80 Tran Nhat Duat St., Hanoi City.
Phone: 8284595
Activity: Garment
31/ Toan Thang Industrial and commercial LIMITED Company
Address: 159 Minh Khai St., Hanoi City.
Phone: 8732107
Activity: Garment and Trading
32/ Hiep Hung LIMITED Company
Address: 44 Hang Trong St., Hanoi City.
Phone: 8265941
Activity: Garment
33/ Ho Guom Garment Company
Address: Block 7, Duc Giang Sub-District, Gia Lam District, Hanoi City.
Phone: 8271621
Activity: Garment
34/ Viet Anh Manufacturing and Trading LIMITED Company
Address: 1H Bich Cau St., Dong Da District, Hanoi City.
Phone: 8233649
Activity: Garment and Trading
35/ Thang Long Company
Address: 58 Giang Vo St., Hanoi City.
Phone: 8230005
Activity: Garment
36/ Tan Hong LIMITED Company
Address: 11B Ham Long St., Hoan Kiem District, Hanoi City.
Phone: 8259248
Activity: Garment
37/ Hanoi 27/7 Packing Company
Address: 4 Lang Ha St., Ba Dinh District, Hanoi City.
Phone: 8343457
Activity: Garment and container
38/ Son Chinh LIMITED Company
Address: Dong Tri Commune, Tu Hiep Sub-District, Thanh Tri District, Hanoi City.
Phone: 8615636
Activity: Garment
Joint-ventures
39/ Hanoi 19/5 textile and Garment LIMITED Company
Address: 157 Nguyen Tuan St., Thanh Xuan Sub-District, Dong Da District, Hanoi City.
Phone: 8586024. FAX: 8582909
Activity: Textile and Garment
40/ ARKSUN LIMITED Company
Address: 164 Ton Duc Thang St., Hanoi City.
Phone: 8512239
Activity: Textile and Garment
2. Ha Tay:
40/ HUNG THINH EXPORT-IMPORT GARMENT AND EMBROIDERING COMPANY
Address: 76 Tran Dang Ninh St., Ha Dong Town, Ha Tay Province.
Phone: 034.824880.
FAX: 034.824196
Activity: Garment and embroidering
41/ SON HA EXPORT-IMPORT GARMENT AND EMBROIDERING COMPANY
Address: 208 Le Loi St., Son Tay Town, Ha Tay Province.
Phone: 034.832088.
FAX: 034.833035
Activity: Garment and embroidering
42/ HA TAY EXPORT-IMPORT COMPANY (UNIMEX HA TAY)
Address: 16A Tran Dang Ninh St., Ha Dong Town, Ha Tay Province.
Phone: 034.824293.
FAX: 034.824998
Activity: Garment
43/ SON TAY HANDICRAFT MANUFATURING ENTERPRISE
Address: 5 Trung Vuong St., Son Tay Town, Ha Tay Province.
Phone: 832051a
Activity: Garment
3. Hung Yen:
44/ HUNG YEN GARMENT COMPANY II
Address: Hien Nam, Hung Yen Town, Hung Yen Province.
Phone: 032.862310.
FAX: 032.862365
Activity: Garment
45/ PHO HIEN GARMENT COMPANY
Address: Cho Gao. Hien Nam Commune, Hung Yen Town, Hung Yen Provine
Activity: Garment.
46/ HUNG YEN EXPORT-IMPORT COMPANY
Address: Hien Nam Commune, Hung Yen Town, Hung Yen Province.
Phone: 863979
Activity: Garment.
47/ HUNG YEN GARMENT ENGINEERING COMPANY
Address: 76 Nguyen Thien Thuat St., Hung Yen Town, Hung Yen Province.
Phone: 862441
Activity: Garment.
4. H¶i Du¬ng:
48/ Hai Duong Garment Company II
Address: Lien Co Rd, Hai Duong Town. Hai Hung Provine.
Phone: 853931. FAX: 853831
Activity: Garment
49/ HAI HUNG ART EXPORT COMPANY (ARTEXCO HAI HUNG)
Address: Hong Quang Rd., Hai Duong. Hai Hung Province.
Phone: 852443
Activity: Garment
50/ NAM SON EXPORT-IMPORT LIMITED COMPANY
Address: My Van District, Hai Hung Province.
Phone: 8217234. FAX: 8218121
Activity: Garment
51/ BINH MINH TRADE LIMITED COMPANY
Address: 1B Binh Minh St., Pham Ngu Lao Sub-District, Hai Duong, Hai Hung Province.
Phone: 032.852615. FAX: 032.854746
Activity: Garment
52/ BVT LIMITED COMPANY
Address: Thach Khoi Sub-district, Gia Loc District, Hai Hung Province.
Phone: 032.854727. FAX: 032.854746
Activity: Garment
53/ VINH THINH GARMENT AND TRADE COMPANY
Address: 51 Quang Trung St., Hai Duong Town, Hai Hung Province.
Phone: 032.857210
Activity: Garment
54/ HAI DUONG GARMENT COMPANY I
Address: Chi Lang St., Hai Duong Town, Hai Hung Province.
Phone: 852209
Activity: Garment
5. Thai Binh
55/ THAI BINH COMPANY EXPORT-IMPORT (UNIMEX THAI BINH)
Address: 2 Phan Chu Trinh St., Thai Binh Town, Thai Binh Province.
Phone: 036.831722, FAX: 036.381312
Activity: Garment
56/ THAI BINH EXPORT GARMENT COMPANY
Address: KM3 Road No. 10, Quang Trung Sub-District, Thai Binh Town, Thai Binh Province
Phone: 036.831695. FAX: 036.831695
Activity: Garment
57/ THANH CONG EXPORT GARMENT ENTERPRISE
Address: No. 2 National Road 10, Quang Trung Sub-District, Thai Binh Town, Thai Binh Province
Phone: 036.831571.
Activity: Garment
7. Bac Ninh
58/ BAC NINH EXPORT-IMPORT COMPANY (IMEXCO HA BAC)
Address: 2 Nguyen Thi Luu Road, Bac Giang Town, Ha Bac Province
Phone:
Activity: Garment
59/ BAC GIANG TRADE SERVICE COMPANY
Address: 2 Ngo Gia Tu, Bac Giang Town, Ha Bac.
Phone: 024857278. FAX: 024856054
Activity: Garment
60/ BAC GIANG TRADE COMPANY
Address: Nguyen Thi Luu Road, Bac Giang Town, Ha Bac Province
Phone: 024.854520. FAX: 024.854655
Activity: Garment
8. Quang Ninh
61/ QUANG NINH EXPORT GARMENT COMPANY
Address: KM2 Nguyen Van Cu Road. Ha Long City, Quang Ninh Province
Phone: 033.826562. FAX: 033.824426
Activity: Garment
9. Lang Son
62/ VIET LINH TEXTILE-GARMENT LTD. COMPANY
Address: Bac Son Road, Hoang Van Thu Sub-District, Lang Son Town. Lang Son Province
Phone: 025.873173
Activities: Textile and garment
10. Hai Phong
63/ HAI PHONG GARMENT COMPANY (FOGAREXCO)
Address: 72 Lach Tray St., Hai Phong City.
Phone: 847005
Activity: Garment
64/ HAI PHONG GARMENT COMPANY II
Address: 166 Tran Thanh Ngo St., Kien An District, Hai Phong City.
Phone: 031.8876529. FAX: 034.876112
Activity: Garment
65/ HAI PHONG GARMENT COMPANY III
Address: 279 Cho Hang Road, Le Chan District, Hai Phong Province.
Phone: 031.854281. FAX: 031.854342
Activity: Garment
66/ HAI PHONG MANUFACTURING AND EXPORT-IMPORT COMPANY (ANPROTEX)
Address: An Duong, An Hai District, Hai Phong Province.
Phone: 031.871817. FAX: 031.871543
Activity: Garment
67/ HAI PHONG ART EXPORT-IMPORT COMPANY
Address: 56 Dien Bien Phu St., Hai Phong Province.
Phone: 031.859836. FAX: 031.842920
Activity: Garment, Trading
68/ HAI PHONG TRADING AND MANUFACTURING COMPANY (LECONEX HAI PHONG)
Address: 10 Ho Sen St., Le Chan District, Hai Phong Province.
Phone: 846818. FAX: 845126
Activity: Garment, Trading
11. Nam Dinh
69/ Nam Ha EXPORT Garment Company
Address: 2 Thanh Nien Road, Nam Dinh City
Phone: 035.849563. FAX: 035.44767
Activity: Garment
70/ Thang Loi knitting Company
Address: 115 Ninh Binh Road, Nam Dinh City.
Phone: 849507. FAX: 847696
Activity: Knitwear
71/ Nam Ha EXPORT embroider Enterprise (ARTEX Nam Ha)
Address: 37 Phu Long A St., Nam Dinh City.
Phone: 848226. FAX: 848005
Activity: Garment
72/ Nam Ha general service and Manufatruning Company (GESAEPCO)
Address: 121 Hai Ba Trung St., Nam Dinh City.
Phone: 848252. FAX: 844802
Activity: Garment, Trading
73/ South Asia Garment Company
Address: 64 Tran Phu St., Nam Dinh City.
Phone: 848559. FAX: 845481
Activity: Garment
74/ Nam Ha art EXPORT-IMPORT Company
Address: 5A Giai Phong Road, Nam Dinh City.
Phone: 849851. FAX: 847549
Activity: Garment, Trading
75/ Nam Ha Red River Company
Address: 28 Pham Hong Thai St., Nam Dinh City.
Phone: 849365. FAX: 846737
Activity: Garment
76/ Nam Ha Fine Garment Enterprise
Address: 4 Tran Hung Dao St., Nam Dinh City.
Phone: 848432. FAX: 849499
Activity: Garment
77/ Thanh Nam Garment Enterprise
Address: 93 Cong Hau St., Nam Dinh City.
Phone: 849602
Activity: Garment
78/ Nam Dinh art EXPORT Enterprise (ARTEX Nam Dinh)
Address: 28 Phu Long St., Nam Dinh City.
Phone: 849221. FAX: 849221
Activity: Garment
79/ Nam Dinh Silk Company
Address: 2 Ha Huy Tap St., Nam Dinh City.
Phone: 8271621
Activity: Silk Weaving, Garment
80/ Truong Xuan LIMITED Company
Address: Km2 Dien Bien Road, Nam Dinh City.
Phone: 848241.
Activity: Garment
81/ Union EXPORT-IMPORT and Investment Company (UNIMEX).
Address: 304 Han Thuyen St., Nam Dinh City.
Phone: 849613
Activity: Garment, Trading
82/ Nam Dinh Far-Eastern LIMITED Company
Address: 35 Phan Dinh Phung St., Nam Dinh City.
Phone: 846649
Activity: Garment
83/ Vinh Oanh Textile-Garment LIMITED Company
Address: Nam Dinh City, Marketing Office: 298 Giai Phong Road, Hanoi.
Phone: 8643375
Activity: Textile, Garment
12. Ha Nam
84/ Enterprise Garment 9 (Company Garment NhA BE)
Address: 73 Hoang Thao St., Nam Dinh City, Nam Ha Province.
Phone: 845752
Activity: Garment
85/ Ha Nam 277 Company
Address: Hai Ba Trung Sub-District, Ha Nam City
Phone: 035.851235
Activity: Garment
86/ Bac Ha Manufacturing and EXPORT-IMPORT Company
Address: Thanh Ha St., Thanh Liem District, Ha Nam City.
Phone: 862375
Activity: Garment
13. Phu Tho
87/ Song Hong Garment Company
Address: Hong Ha St., Tien Cat Sub-District, Viet Tri City, Phu Tho Province.
Phone: 021,846506. FAX: 021
Activity: Garment
88/ Viet Tri EXPORT Garment Company (VITRIGACO)
Address: 11 Hoa Phong Road, Gia Cam District, Viet Tri City, Phu Tho Province..
Phone: 021.846439. FAX: 021.848005
Activity: Garment
89/ Phu Tho Garment Company I
Address: 47 Hung Vuong St., Viet Tri City, Phu Tho Province.
Phone: 021.846208. FAX: 848680
Activity: Garment
90/ Phu Tho Garment Company II
Address: Phong Chau Sub-District, Phu Tho Province.
Phone: 021.820013. FAX: 021.820517
Activity: Garment
14. Vinh Phuc:
91/ Kim Long LIMITED Company
Address: 53 Ngo Quyen St., Vinh Yen Town, Vinh Phuc Province.
Phone: 021.861177
Activity: Garment
15. Ninh Binh:
92/ Ninh Binh Garment EXPORT Company
Address: 9 Dinh Tien Hoang St., Ninh Binh Town, Ninh Binh Province.
Phone: 030.871172. FAX: 030.871120.
Activity: Garment
16. Thai Nguyen:
93/ Thai Nguyen Garment Company
Address: 214 Minh Cau Rd., Thai Nguyen City.
Phone: 028.854462. FAX: 028.852060
Activity: Garment
17. Thanh Hoa:
94/ Thanh Hoa EXPORT-IMPORT Company (IMEXCO Thanh Hoa)
Address: 2 Phan Chu Trinh St., Thanh Hoa City.
Phone: 037.852598, FAX: 037.852965
Activity: Garment
95/ Thanh Hoa Garment Company
Address: Lam Son Sub-District, Thanh Hoa City.
Phone: 037.852229. FAX: 037.855687
Activity: Garment
18. Tuyen Quang
96/ Thong Nhat Garment Cooperative
Address: 34A Tan Quang Sub-District, Tuyen Quang Town.
Phone: 027.821636. FAX: 027.822897
Activity: Garment
19. Nghe An
97/ Nghe An Garment Company
Address: 1 Le Mao Road, Vinh City. Nghe An Province.
Phone: 038.824655. FAX: 038.844812
Activity: Garment
98/ Hoang Thi Loan Knitting Enterprise
Address: Ben Thuy Sub-district, Vinh City, Nghe An Province.
Phone: 038.855407. FAX: 038.855422, Marketing Office in Hanoi: 16B Ly Nam De St., Hanoi
Activity: Knittwear
99/ Nghe An General Trading and Investment service Company
Address: 45 Phan Dinh Phung St., Vinh City, Nghe An Province.
Phone: 038.844756
Activity: Garment
100/ Nghe An Textile Company
Address: 5 Mai Hac De Rd., Le Loi Sub-District, Vinh City.
Phone: 842679
Activity: Textile and Garment
20. H_ Tinh
101/ Thanh Cong Garment Export Company
Address: 74 Phan Dinh Phung St., Ha Tinh Town, Ha Tinh Province.
Phone: 039.856504. FAX: 039.857594
Activity: Garment
Joint-ventures in Northern Pvovinces/Cities
102/ Hanoi Garment EXPORT Company (HANTEX)
Address: Khuong Dinh Sub-district, Thanh Tri District, Hanoi City.
Phone: 8582244. FAX: 8.582300
Activity: Garment
103/ VIET PACIFIC Garment LIMITED Company
Address: 100 Mo Lao St., Ha Dong Town.
Phone: 034.827131. FAX: 034.827135
Activity: Garment
104/ VENTURE INTERNATIONAL limited Company
Address: F 309, 310, F4 Diplomat Resident Quarter, Trung Tu Sub-district, Dong Da District, Hanoi City.
Phone: 032.854630. FAX: 032.854629
Activity: Garment
Central SOEs in Northern and Southern Provinces/Cities.
105/ Art EXPORT-IMPORT Company (ARTEXPORT)
Address: 31-33 Ngo Quyen St. Hanoi City.
Phone: 8256490. FAX: 8259275
Activity: Garment
106/ general EXPORT-IMPORT Company I (GENERALEXIM)
Address: 46 Ngo Quyen St., Hanoi City.
Phone: 8264008. FAX: 8.259894
Activity: Trading and Garment
107/ Trading service and EXPORT-IMPORT Company (INTIMEX)
Address: 96 Tran Hung Dao St., Hanoi City.
Phone: 8255863. FAX: 8259250
Activity: Trading and Garment
108/ Thang Long ARTEX Company
Address: 164 Ton Duc Thang St., Hanoi City.
Phone: 8431381. FAX: 8456731
Activity: Garment and Trading
109/ Hanoi Consumer goods EXPORT-IMPORT Company (TOCOTAP Hanoi)
Address: 36 Ba Trieu St., Hanoi City.
Phone: 8256733. FAX: 8255917
Activity: Garment and Trading
110/ Nothern Textile and Garment Corporation (TEXTACO)
Address: 5 Dien Bien Phu St., Hanoi City.
Phone: 8232876. FAX: 8232318
Activity: Textile, Garment, and Trading
111/ Southern Textile and Garment Corporation (GATEXCO)
Address: 80 Truong Dinh St., District 3, HCM City.
Phone: 088.657637. FAX: 088.640463
Activity: Textile, Garment, and Trading
112/ HCMC Consumer goods EXPORT-IMPORT Company (TOCONTAP Sai Gon)
Address: 18 Nguyen Hue St., District 1, HCM City.
Phone: 088.299513. FAX: 088.290508
Activity: Garment and Trading
113/ general EXPORT-IMPORT Company II (GENERALIMEX)
Address: 66 Pho Duc Chinh St., District 1, HCM City.
Phone: 088.292990. FAX: 088.292968
Activity: Garment and Trading
114/ Furniture and Art Manufaturing and EXPORT-IMPORT Company (UPEXIM)
Address: 4-6 Ho Tung Mau St., District 1, HCM City
Phone: 088.291269. FAX: 088.296721
Activity: Garment, Furniture and Trading
115/ packing manufacturing and EXPORT-IMPORT Company (PACKSIMEX)
Address: 35-37 Ben Chuong Duong St., District 1, HCM City.
Phone: 088.222696. FAX: 088.230192
Activity: Garment and trading
116/ Southern transportation and Warehouse Company (SOTRANS)
Address: 18 Hoang Dieu St., Sub-District 12, District 4, HCM City.
Phone: 088.225947. FAX: 088.2225345
Activity: Transportation, warehouse service and Garment
117/ Forestry¡¦s Construction Materials Company
Address: 100 Lo Duc St., Hanoi City.
Phone: 613105
Activity: Furniture, Building Materials and Garment
Ministry of Industry
Textile in North
118/ Vietnam General Textile Garment Corporation (VINATEX)
Address: 25 Ba Trieu St., Hanoi City.
Phone: 8266428. FAX: 8262268
Activity: Garment, Textile and Trading
119/ 8 March Textile Company (EMETEXCO)
Address: 460 Minh Khai St., Hanoi City.
Phone: 8624460. FAX: 8624463
Activity: Textile and Garment
120/ Hanoi Textile Company (HANOSIMEX)
Address: 1 Mai Dong Rd, Hai Ba Trung District, Hanoi City.
Phone: 8621024. FAX: 8622334
Activity: Textile and Garment
121/ Dong xuan knitting Company (DOXIMEX)
Address: 67 Ngo Thi Nham St., Hanoi City.
Phone: 8.266564. FAX: 8.255580
Activity: Knittwear
122/ Hanoi Industrial Fabrics Company
Address: Mai Dong Sub-District, Hai Ba Trung District, Hanoi City.
Phone: 8624945. FAX: 8.624945
Activity: Manufacturing Fabrics for Industry
123/ Nam Dinh Textile Company (NATEXCO)
Address: 6 - 43 To Hieu St., Nam Dinh City.
Phone: 038.49422, FAX: 038.49750
Activity: Textile and Garment
124/ Vinh Phu Textile Company
Address: 108 Hung Vuong Road, Viet Tri City, Vinh Phu Province.
Phone: 021.846478. FAX: 021.846676
Activity: Textile and Garment
Textile in the South
125/ Sai Gon Textile and Garment Company (TEXGAMEX)
Address: 298 A Nguyen Tat Thanh, Sub-District 13, District 4, HCM City
Phone: 088.724859. FAX: 088.720759
Activity: Textile and Garment
126/ Thang Loi Textile Company(VITEXIM)
Address: No. 2, National Road I, Sub-District 15, Tan Binh District, HCM City
Phone: 088.650178. FAX: 088.643076
Activity: Textile and Garment
127/ Viet Thang Textile Company (VICOTEX)
Address: 35/37 Ben Chuong Duong, District 1, HCM City
Phone: 088.969337. FAX: 088.969319
Activity: Textile and Garment
128/ Phuoc Long Textile Company (PULTEX)
Address: Xom Moi Commune, Phuoc Long Sub-district, Thu Duc District, HCM City
Phone: 088.964710. FAX: 088.964715
Activity: Textile and Garment
129/ Phong Phu Textile Company
Address: Phong Phu Commune, Tang Nhon Phu Sub-district, Thu Duc District, HCM City
Phone: 088.963533. FAX: 088.966088
Activity: Textile and Garment
130/ South-East Textile Company
Address: 18/3 Au Co St., Sub-District 17, Tan Binh District, HCM City
Phone: 088.640345. FAX: 088.640619
Activity: Textile and Garment
131/ East Asia Textile Company (DATEXCO)
Address: 185-189 Le Dai Hanh St., District 11, HCM City
Phone: 088.651299. FAX: 088.650075
Activity: Textile and Garment
132/ Thanh Cong Textile Company (T.C.TEX)
Address: No. 8 Natoinal Road I, Tan Binh District, HCM City.
Phone: 088.641168. FAX: 088.645232
Activity: Textile and Garment
133/ Dong Phuong Knitting Company (DOPIMEX)
Address: 10 Au Co, Tan Binh District, HCM City.
Phone: 088.464062. FAX: 088.495940
Activity: Knittwear
134/ Binh Loi Wool Blanket Manufacturing Company
Address: 438 No Trang Long St., Binh Thanh District, HCM City.
Phone: 088.432359. FAX: 088.432352
Activity: Woolen Blanket Manufacturing
135/ Bien Hoa Woolen Company
Address: Bien Hoa Industrial Zone I, Dong Nai Province.
Phone: 061.836120. FAX: 061.836308
Activity: Woolen Products
136/ Vinh Thinh Woolen Company
Address: Phuoc Long Commune, Thu Duc District, HCM City.
Phone: 088.965151. FAX: 088.963446
Activity: Woolen Products
137/ Hoa Binh Match Company
Address: 346 Ben Van Don St., Sub-District 1, District 4, HCM City.
Phone: 89401950
Activity: Textile
Garment in the North
138/ Thang Long Garment Company (THALOGA)
Address: 250 Minh Khai, Hanoi City.
Phone: 8623372. FAX: 8.623374
Activity: Garment
139/ Garment Company 10 (GARCO 10)
Address: Sai Dong Sub-District, Gia Lam District, Hanoi City.
Phone: 8.276923. FAX: 8.276925
Activity: Garment
140/ Chien Thang Company Garment
Address: 8B Le Truc St., Hanoi City.
Phone: 8312078. FAX: 8312208
Activity: Garment
141/ Duc Giang Garment Company (DUGARCO)
Address: Duc Giang Sub-District, Gia Lam District, Hanoi City.
Phone: 8271344. FAX: 8.271896
Activity: Garment
142/ Hung Yen Garment Company
Address: 83 Trung Trac St., Hung Yen Town, Hai Hung Province.
Phone: 032.862312. FAX: 032.862500
Activity: Garment
143/ Nam Dinh Garment Company (NAGACO)
Address: 46 Tran Hung Dao St., Nam Dinh City.
Phone: 035.849627. FAX: 035.849451
Activity: Garment
144/ Dap Cau Garment Company
Address: Km 6, Thi Cau Rd., Bac Ninh Town, Ha Bac Province.
Phone: 0241.821290. FAX: 0241.821745
Activity: Garment
145/ Hai Phong Woollen Company
Address: 106 Luong Khanh Thien St., Hai Phong.
Phone: 031.846411. FAX: 031.844739
Activity: Woollen Products
146/ Vietnam Plastic Company (VINAPLAST)
Address: 59 Ly Tu Trong St., District 1, HCM City.
Phone: 088.298232. FAX: 088.291841
Activity: Garment
Garment in the South
147 Viet Tien Garment Company
Address: 7 Le Minh Xuan St., Tan Binh District, HCM City.
Phone: 088.540800. FAX: 088.645085
Activity: Garment
148/ Nha Be Garment Company (NHABECO)
Address: Commune 4, Tan Thuan Dong sub-district, Nha Be District, HCM City.
Phone: 088.720077. FAX: 088.8729937
Activity: Garment
149/ Huu Nghi Garment and Print Company
Address: 636 - 638 Nguyen Duy St., District 8, HCM City.
Phone: 088.554176. FAX: 088.553476
Activity: Garment
150/ Hoa Binh Garment Company (PEGARIMEX)
Address: 830 Nguyen Duy St., District 8, HCM City.
Phone: 088.555566. FAX: 088.553072
Activity: Garment
151/ Doc Lap Garment Company (DOLIMEX)
Address: 444 A - 446 August Revolution St., District 3, HCM City.
Phone: 088.440053. FAX: 088.443681
Activity: Garment
152/ Phuong Dong Garment Company
Address: 1/1B Quang Trung St., Go Vap District, HCM City.
Phone: 088.945729. FAX: 088.940328
Activity: Garment
153/ Binh Minh Garment Company (BIGAMEX)
Address: 440 No Trang Long St., Binh Thanh District, HCM City.
Phone: 088.432358. FAX: 088.432348
Activity: Garment
154/ Southern Battery Company (PINACO)
Address: 752 Hau Giang St., Sub-District 12, District 6, HCM City.
Phone: 088.750807. FAX: 088.752114
Activity: Battery and Garment
Ministry of Defence
155/ No. 28 Company
Address: 3 Nguyen Oanh St., Go Vap District, HCM City.
Phone: 088.940404. FAX: 088.943053
Activity: Garment
156/ No. 32 Shoes Manufacturing Company (ASECO)
Address: 170 Quang Trung St., Go Vap District, HCM City.
Phone: 088.941235. FAX: 088.940279
Activity: Shoes and Garment
157/ no. 20 Garment Company
Address: Phuong Liet Sub-District, Dong Da District, Hanoi City.
Phone: 8.645077. FAX: 8.641208
Activity: Garment
158/ HACOTA manufacturing, tourism and EXPORT-IMPORT Company (HACOTEXIM)
Address: 8 Nguyen Binh Khiem St., District 1, HCM City.
Phone: 088.223842. FAX: 088.241103
Activity: Garment, Tourism, Trading
159/ No. 26 Company of Ministry of defence
Address: 66A Nguyen Van Cu St., Gia Lam District, Hanoi City.
Phone: 8732154
Activity: Garment
160/ Viet Bac Company
Address: Tan Thinh Sub-District, Thai Nguyen City.
Phone: 028.846443
Activity: Garment
161/ no. 19 Company of Ministry of defence
Address: 1 Hoang Dieu St., Thai Binh Town.
Phone: 831245
Activity: Garment
162/ thanh binh Company of ministry of defence
Address: 206 Hoang Van Thu St., Tan Binh District, HCM City.
Phone: 441732
Activity: Garment
163/ Lam Hong Company of ministry of defence
Address: 29 Phan Dang Luu St., Vinh City, Nghe An Province.
Phone: 849683
Activity: Garment
164/ no. 247 Company (ministry of defence)
Address: 40A Truong Chinh Road, Hanoi City.
Phone: 8531153
Activity: Garment
165/ Minh Thanh Company (ministry of defence)
Address: 2B Nguyen Thi Minh Khai St., District I, HCM City
Activity: Garment
165/ no. 198 Company (ministry of defence)
Address: 51 Phan Dinh Phung St., Ba Dinh District, Hanoi City.
Phone: 069553047
Activity: Garment
Ministry of Internal Affairs
166/ Bach Dang Company
Address: 42 Truong Dinh St., HCM City. Marketing Office in Hanoi: 30 Tran Hung Dao St., Hanoi City.
Phone: 8.223911. FAX: 8226012
Activity: Garment
167/ 19 May Garment Enterprise
Address: Thanh Xuan Sub-district, Dong Da District, Hanoi City.
Phone: 8.545632. FAX: 8.541368
Activity: Garment
168/ Thai Son Garment Enterprise
Address: 2 Nguyen Thai Son Road, Sub-District 3, Go Vap District, HCM City
Activity: Garment
169/ Phuong Nam Company
Address: 235 C Nguyen Van Cu St., District I, HCM City
Activity: Garment
Other Ministries
Fishery Ministry
170/ Packing printing & EXPORT-IMPORT Company (PARRIMEXCO)
Address: 1B Hoang Dieu St., Sub-District 13, District 4, HCM City
Activity: Garment
171/ Package, Equipment and Net Company (PINETCO)
Address: 125/35 Hung Vuong, District 6, HCM City.
Phone: 088.552932. FAX: 088.51923
Activity: Garment
172/ Bien Dong General Seafood Company
Address: 30 Ham Nghi St., District I, HCM City.
Phone: 8243100
Activity: Garment
Central Youth Committee
173/ Van Xuan Trading and Investment Company
Address: 45 Lang Trung St., Dong Da, Hanoi City.
Phone: 8346070. FAX: 8352499
Activity: Garment
174/ Vietnam youth production and EXPORT-IMPORT Company (VYPEXCO)
Address: 15B Ho Xuan Huong St., Hanoi City. Banch Office in HCM City: 467 Le Van Sy, District 3, HCM City. Phone: 088.445479. FAX: 088.950637
Phone: 8.265651. FAX: 8.265651
Activity: Garment and Trading
Financial Department - Central Party Committee
175/ Viet An manufacturing and EXPORT-IMPORT Company
Address: 251B Minh Khai St., Hai Ba Trung, Hanoi City.
Phone: 8622350. FAX: 8.622631
Activity: Garment and Trading
National Centre for Natural Sciences and Technology
176/ HCM City Manufacturing, Sciences' and technological services, and EXPORT-IMPORT Company (SCITECHIMEX)
Address: 1 Mac Dinh Chi St., District 1, HCM City.
Phone: 088.224575. FAX: 088.228189
Activity: Garment and Trading
177/ Electronic Company (ELECO)
Address: 70 Tran Hung Dao, Hanoi City.
Phone: 8265922
Activity: Garment
178/ Electronic, Tourism and Science-Technology Development Company (IDC)
Address: 74-76 Nguyen Cong Tru, District I. HCM City.
Phone: 8213117
Activity: Garment and scientific services
Vietnam National Front
179/ Tinh Hoa Company
Address: 15 Tu Xuong St., District 3, HCM City.
Phone: 088.200027. FAX: 088.854092
Activity: Garment
180/ Thai Duong Company (SUNCO)
Address: 32 Truong Dinh, District 3, HCM City.
Phone: 088.223161. FAX: 088.225180
Activity: Garment
Vietnam National Union of Cooperatives
181/ Manufacturing, Investment and EXPORT-IMPORT Company (CEIPI Co)
Address: 100B Thuy Khe St., Tay Ho District, Hanoi City.
Phone: 8433996. FAX: 843997
Activity: Garment, investment and trading
182/ Vietnam General EXPORT-IMPORT and technological transfer Company (VINAGIMEX)
Address: 62 Giang Vo St., Hanoi City.
Phone: 8414708
Activity: Garment, trading and technological services
183/ South general trading Company
Address: 30 Dang Van Ngu St., Phu Nhuan District, HCM City.
Phone: 8443455
Activity: Garment and trading
184/ Vietnam Art EXPORT-IMPORT cooperation Company (VISACOOP)
Address: 48 Nguyen Thi Minh Khai St., District I, HCM City.
Phone: 829440
Activity: Garment and trading
Vietnam Airlines Corporation
185/ Air service Company (AIRSERCO)
Address: K10 Gia Lam Airport, Hanoi City.
Phone: 8730422. FAX: 8.272426
Activity: Air Services and Garment
Ministry of Construction
186/ Da River Hydro-Electric Construction Company
Address: Tan Thinh Sub-District, Hoa Binh Town, Hoa Binh Province.
Phone: 018.54031. FAX: 018.854092
Activity: Construction and Garment
Ministry of Rural and Agricultural Development
187/ Garment Company of Ministry of Rural and Agricultural Development
Address: Block D, Phuong Mai Sub-District, Dong Da District, Hanoi City.
Phone: 8523373. FAX: 8.524492
Activity: Garment
188/ Agricultural product and food processing EXPORT-IMPORT Company
Address: 58 Ly Thai To St., Hanoi City.
Phone: 8250667
Activity: Food, Trading and Garment
Transportation Ministry
189/ Vietnam Railway Supply EXPORT-IMPORT Company (VIRASIMEX)
Address: 132 Le Duan St., Hanoi City.
Phone: 8.265932. FAX: 8.266613
Activity: Railway materials and Garment
190/ 21 October Joint-Stock Garment Company
Address: Block 2c, Dong Anh District, Hanoi City.
Phone: 8833700
Activity: Garment
21. Quang Binh
191/ Quang binh general Company
Address: 1 Hung Vuong St., Dong Hoi District,, Quang Binh Province.
Phone: 052.22536. FAX: 052.22460
Activity: Trading and Garment
22. Hue
192/ Hue Textile Company (HUTEXCO)
Address: Thuy Duong Sub-District, Huong Thuy District, Hue City.
Phone: 054.822011. FAX: 054.822012
Activity: Textile and Garment
193/ Hue Textile Garment EXPORT Company
Address: 39 Phan Dinh Phung St., Hue City.
Phone: 054.822101. FAX: 054.828991
Activity: Textile and Garment
194/ Thua Thien Hue EXPORT-IMPORT Company
Address: 11B Nguyen Hue St., Hue City.
Activity: Trading and Garment
Phone: 054.823739. FAX: 054.822224
195/ Hue Embloider and Textile EXPORT Company
Address: 59 Le Huan St., Hue City.
Activity: Carpet, Textile and Garment
196/ Thua Thien Hue Garment EXPORT Company
Address: 59 Le Huan St., Hue City.
Phone: 054.822186.
Activity: Garment
23. Quang Nam
197/ Duy Trinh Textile Garment Cooperative
Address: Coomune III, Duy Trinh Sub-District, Duy xuyen District, Quang Nam Province.
Phone: 0510.877229, 877848. FAX: 0510.877602
Activity: Textile and Garment
198/ Hai Van Textile enterprise
Address: Hoa Tho Commune, Hoa Vang District, Quang Nam Province.
Phone: 051.846596. FAX: 051.846666
Activity: Textile and Garment
199/ Dai Loc trading Company
Address: Ai Nghia Town, Dai Loc District, Quang Nam City.
Phone: 051.865233. FAX: 051.865537
200/ Truong Giang Garment Company
Address: 151 Huynh Thuc Khang St., Tam Ky District,, Quang Nam Province.
Phone: 051.851286. FAX: 051.851416
Activity: Garment
201/ Duy Son General service Cooperative 2
Address: Duy Son Commune, Duy Xuyen District, Quang Nam Province.
Phone: 0510 - 877603 - 877621. FAX: 0510 - 877278 - 877379
Activity: Garment and Trading
202/ Nui Thanh Garment Enterprise
Address: Nui Thanh Town, Nui Thanh District, Quang Nam Province.
Phone: 0510 - 871203. FAX: 0510 - 871203
Activity: Garment
24. Da Nang
203/ Central Electric machine Company (CELIMEX)
Address: 124 Nguyen Chi Thanh St., Da Nang Province.
Phone: 822757. FAX: 822203
Activity: Trading and Garment
204/ central general Fabric Trading Company (CENGIMEX)
Address: 49 Phan Chu Trinh St., Da Nang City, Da Nang Province..
Phone: 051.821819. FAX:051.821871
Activity: Garment and Trading
205/ Hoi An Garment EXPORT Enterprise
Address: 50 Le Hong Phong St., Hoi An Town, Da Nang Province.
Phone: 051.861351
206/ Da Nang Silk Company (DANASI)
Address: 74 Quang Trung St., Da Nang City, Da Nang Province.
Phone: 051.822372. FAX: 051.823658
Activity: Silk and Garment
207/ 29 March Textile-Garment Company
Address: 414 Dien Bien Phu St., Da Nang City, Da Nang Province.
Phone: 051.821275. FAX: 051.826622
Activity: Textile and Garment
208/ Da Nang Carpet, Garment and embloider Company (TANADA)
Address: National Road No. 1A, An Khe District, Da Nang City, Da Nang Province.
Phone: 051.842455. FAX: 051.842413
Activity: Carpet, Embloider and Garment
209/ Da Nang EXPORT-IMPORT Company (DANIMEXCO)
Address: 34 Hoang Van Thu St., Da Nang City. Da Nang Province.
Phone: 051 - 823827 - 824835
Activity: Garment and Trading
210/ Hoa Tho Textile Company
Address: Hoa Tho Commune, Hoa Vang District, Da Nang City.
Phone: 0511.846290. FAX: 0511.846216
Activity: Textile and Garment
211/ 234 sea-transportation Company
Address: A2 Nui Thanh St., Da Nang City.
Phone: 051.823925. FAX: 051.823755
Activity: Transportation Garment
212/ Da Nang Friendship Company
Address: 53 Nui Thanh St., Da Nang City.
Phone: 051.821421. FAX: 051.822472
Activity: Garment
213/ VALIEY VIEW Company
Address: Thanh Khe 3 Commune, Thanh Loc Dan District, Da Nang Province.
Phone: 0511.825431
Activity: Garment
214/ Thanh Son Woolen Carpet and EXPORT-IMPORT Company
Address: 36 Thanh Son St., Da Nang City.
Phone: 0511.830403. FAX: 0511.825678
Activity: Woolen Carpet and Garment
215/ Da Nang Shoe Company
Address: 9 Xuan Hoa Road, Da Nang City.
Phone: 0511.835983. FAX: 0511.822871
Activity: Shoes and Garment
216/ Nui Thanh Garment Enterprise
Address: Nui Thanh Town, Nui Thanh District, Quang Nam Province.
Phone: 0510.871203
Activity: Garment
25. Quang Ngai
217/ Quang Ngai Agricultural Products and food Company (APFCO)
Address: 48 Pham Xuan Hoa St., Quang Ngai Town, Quang Ngai Province.
Phone: 822542. FAX: 822060
Activity: Food Processing and Garment
26. Binh Dinh
218/ Binh Dinh Textile Garment EXPORT Company
Address: 1 Ngo May St., Quy Nhon City, Binh Dinh Province.
Phone: 056.846251. FAX: 056.846380
Activity: Textile and Garment
219/ Central art and EXPORT-IMPORT Company (CENCOOPIMEX)
Address: 275 Tran Hung Dao Road, Quy Nhon Town, Binh Dinh Province.
Phone: 056.821234. FAX: 056.823764
Activity: Garment and Traing
220/ Binh Dinh EXPORT-IMPORT Company (IMEX Binh Dinh)
Address: 1 Dong Da St., Quy Nhon Town, Binh Dinh Province.
Phone: 056.822283. FAX: 056.823623
Activity: Garment and Trading
221/ Binh Dinh general trading Company
Address: 287-389 Tran Hung Dao St., Quy Nhon Town, Binh Dinh Province.
Phone: 056.822233. FAX: 056.821862
Activity: Garment and Trading
222/ Binh Dinh general Phone manufacturing and EXPORT-IMPORT service Company (PISICO)
Address: 248 Tran Hung Dao St., Quy Nhon Town, Binh Dinh Province.
Phone: 056.821874. FAX: 056.821862
Activity: Telephone, Garment and Trading
27. Gia Lai
223/ Gia Lai EXPORT-IMPORT Company (GIAKEXIM)
Address: 62 Phan Boi Chau St., Pleiku Town, Gia Lai Province.
Phone: 059.822345. FAX: 059.824189
Activity: Garment and Trading
28. Kon Tum
224/ Kon Tum Investment and EXPORT-IMPORT Company
Address: 104 Le Hong Phong St., Kon Tum Town
Phone: 060.864100. FAX: 060.862215
Activity: Garment, Trading and Investment
29. Nha Trang
225/ Nha Trang Textile Company
Address: Vinh Phuong Commune, Nha Trang City.
Phone: 058.831050. FAX: 058.831052
Activity: Textile and Garment
226/ Khanh Hoa Garment Company
Address: 12 Le Thanh Ton St., Nha Trang City, Khanh Hoa Province.
Phone: 058.822527. FAX: 058.823830
Activity: Garment
227/ Tan Tien Garment Enterprise
Address: 84 Hung Vuong St., Nha Trang City. Khanh Hoa Province.
Phone: 058.821074. FAX: 058.823801
Activity: Garment
228/ General EXPORT-IMPORT Company III (GENTRIMEX)
Address: 48 Tran Phu St., Nha Trang City, Khanh Hoa Province.
Phone: 058.821239. FAX: 058.821914
Activity: Garment and Trading
229/ SODEX TOSECO Joint-Stock Company
Address: 57-59 Phan Boi Chau St., Nha Trang City, Khanh Hoa Province.
Phone: 058.23935
Activity: Garment
230/ Khanh Hoa Art EXPORT-IMPORT Company (KHACORIMEX)
Address: 178 Tran Quy Cap St., Nha Trang City, Khanh Hoa Province.
Phone: 058 - 822742. FAX: 058 - 821904
Activity: Garment and Trading
30. Phu Yen
231/ Phu Yen Manufacturing and EXPORT-IMPORT Company - (FIFEXIM)
Address: 4 Le Loi St.,, Tuy Hoa Town, Phu Yen Province.
Phone: 057.823316. FAX: 057.824149
Activity: Garment and Trading
232/ Song Hinh Trading Company (SOHIMEX)
Address: 81 National Road No. 1A, Tuy Hoa Town, Phu Yen Province.
Phone: 057.823836. FAX: 057.823104
Activity: Garment and Trading
233/ Nga Tan Garment and Commercial Company
Address: 117A Nguyen Trai St., Tuy Hoa Town, Phu Yen Province.
Phone: 057.826043. FAX: 826043
Activity: Garment and Trading
31. Da Lat:
234/ Nam Phuong Manufacturing and EXPORT-IMPORT (NAFUMEX)
Address: 454A Tran Phu St., Bao Loc Town, Lam Dong Province.
Phone: 063.864136. FAX: 063.862639
Activity: Garment and Trading
235/ Da Lat Manufacturing and EXPORT-IMPORT Company (DALEXIMCO)
Address: 71 Road 3 Feb., Da Lat Town, Lam Dong Province.
Phone: 063.822086. FAX: 063.823495
Activity: Garment and Trading
236/ Da Lat APEX Company (100% Foreign Owned)
Address: 38 Tran Phu St., Da Lat Town, Lam Dong Province.
Phone: 063.824024. FAX: 063.823892
Activity: Garment
237/ Vietnam General Silk Corporation (VISER)
Address: Bao Loc Town, Lam Dong Province.
Activity: Silk and Garment
238/ Bao Loc Silk Joint-Stock Company (VIKOTEX)
Address: Loc Tien Commune, Bao Loc Town, Lam Dong Province.
Activity: Silk and Garment
239/ Da Lat Garment, Embloidering and EXPORT Company
Address: 9 Phu Dong Thien Vuong St., Da Lat Town, Lam Dong Province.
Phone: 063.823624 - 063 - 830727
Activity: Garment, Embloidering and Trading
240/ Da Lat Industrial, Training and EXPORT-IMPORT Company
Address: 1 Van Kiep St., Sub-District 8, Da Lat Town, Lam Dong Province.
Phone: 063.828888. FAX: 063.826551
Activity: Garment, Training and Trading
241/ International Textile Garment Company
Address: 13 Dinh Tien Hoang St., Da Lat Town, Lam Dong Province.
Phone: 063.823499. FAX: 063.861922
Activity: Textile and Garment
242/ Ba Thien Company
Address: 74 Huynh Thuc Khang St., Sub-District 2, Bao Loc District, Lam Dong Province.
Phone: 063.8619111. FAX: 063.861922
Activity: Garment
32. Binh Thuan
243/ Garment and Embloidering Limited Company (O.G.C)
Address: 162/39 Hai Thuong Lan Ong St., Phan Thiet Town, Binh Thuan Province.
Phone: 062.822990. FAX: 062.822964
Activity: Garment and Embloidering
244/ Binh Thuan Garment Export Company (BTEXGA)
Address: 200 Nguyen Hoi St., Phan Thiet Town, Binh Thuan Province.
Phone: 062.821947. FAX: 062.823347
Activity: Garment
33. Ninh Thuan
245/ Thuy Binh Garment Enterprise
Address: Km2 + 300 National Road No. 27, Sub-District Phuoc My, Phan Rang Town, Ninh Thuan Province.
Phone: 068 - 823412. FAX: 068 - 822600
Activity: Garment
34. Ba Ria - Vung Tau
246/ Agricultural product, handicraft and EXPORT-IMPORT Company (Vung Tau SINHANCO)
Address: 32-34-36 Ly Thuong Kiet St., Vung Tau City.
Phone: 064.852622. FAX: 064.859850
Activity: Agricultural Product, Fine Art and Garment
247/ Vung Tau Petroleum service and EXPORT-IMPORT Company - (VIECO Vung Tau)
Address: 36A National Road No. 51A, Vung Tau City.
Phone: 064.848372. FAX: 064.848244
Activity: Trading and Garment
248/ Hung Thinh Company
Address: 175/5 Binh Gia St.,, Sub-District 8, Vung Tau City
Phone: 064.855583. FAX: 064.856.782
Activity: Garment
249/ Petroleum Wholesale and commercial Company
Address: 15 Le Hong Phong St., Sub-District 2, Vung Tau Town.
Phone: 064.853027. FAX: 064.858822
Activity: Garment and Trading
35. Dong Nai
250/ Dong Nai Garment Company
Address: Bien Hoa Industrial Zone, Dong Nai Province.
Phone: 061.8296617a. FAX: 061.836141
Activity: Garment
251/ Dong Nai Industrial Garment Company
Address: Bien Hoa Industrial Zone, Dong Nai Province.
Phone: 061.836117. FAX: 061.836118
Activity: Garment
252/ Dong Tien Garment LIMITED Company
Address: 10 Road No. 5, Tan Tien Sub-District, Bien Hoa City, Dong Nai Province.
Phone: 061.823011. FAX: 061.823441
Activity: Garment
253/ Dong Thinh Garment LIMITED Company
Address: 5/8 Group 3, Thong Nhat Sub-District, Bien Hoa City, Dong Nai Province.
Phone: 061.823020
Activity: Garment
254/ Vietnam ROSTAING Enterprise
Address: Bien Hoa Industrial Zone 2, Dong Nai Province.
Phone: 061.836375. FAX: 061.836376
Activity: Garment
255/ international Y TRANG ROOHSING LIMITED Company
Address: Tan Tien Sub-District, Bien Hoa City, Dong Nai Province.
Phone: 061.824701. FAX: 061.824706
Activity: Garment
256/ Dong Nai BOCHANG international limited Company (DONABOCHANG INTERNATIONAL Co. Ltd.).
Address: 226/2 National Road No. 13, Tan Hoa Sub-District, Thong Nhat District, Dong Nai Province.
Phone: 061.8997484. FAX: 061.8991352
Activity: Garment
257/ BULTEL Company
Address: Dong Khoi Road, Tan Hiep Sub-District, Bien Hoa City, Dong Nai Province.
Phone: 061.824358. FAX: 061.824359
Activity: Garment
258/ CHINGFA LIMITED Company
Address: Tuy H_ Industrial Zone, Hiep Phuoc Commune, Nhon Trach District, Dong Nai Province. Phone: 061.848966. FAX: 061.848898. Branch Office: 196 Nguyen Dinh Chieu St.,, District 3, HCM City.
Phone: 088.245449/088.245450. FAX: 088..245424
Activity: Garment
259/ Hoa Long Company (100% Foreign Owned)
Address: Thanh Tuy Ha Industrial Zone, Phuoc Thien Sub-District, Nhon Trach District, Province Dong Nai.
Phone: 061.848608 - 061.848609. FAX: 061.848726. (Branch Office: 40 Vo Van Tan, District I, HCM City. Phone: 088 - 298624)
Activity: Garment
260/ Dong Nai Match Company
Address: Bien Hoa Industrial Zone, Dong Nai Province.
Phone: 061.836174
Activity: Garment and Match
36. Dong Thap
261. SAO MAI Joint-Stock Company
Address: A44 National Road No. 30, Cao Lanh Town, Dong Thap Province
Phone: 067.851900. FAX: 067.8351016
Activity: Garment
37. An Giang
262/ An Giang Garment Export Company
Address: My Quoi Commune, My Phuoc Sub-District, Long Xuyen Town, An Giang Province. Phone: 076.834709. FAX: 076.834915
Activity: Garment
263/ An Giang EXPORT-IMPORT Company (ANGIMEX)
Address: 1 Ngo Gia Tu St., Long Xuyen Town, An Giang Province.
Phone: 076 - 841548. FAX: 076 - 843239
Activity: Garment and Trading
38. Long An
264/ Long An General Manufacturing and EXPORT-IMPORT LIMITED Company (LADFECO)
Address: Binh Cu Commune, Loi Binh Nhon Sub-District,, Tan An Town, Long An Province
Phone: 072.821608. FAX: 072.826327
Activity: Garment and Trading
265/ Hoang De Long LIMITED Company (100% foreign owned)
Address: Commune 1, Nhat Chanh Sub-District, Ben Luc District, Long An Province.
Phone: 8393709. FAX: 8353576
Activity: Garment
266/ Tien Ve LIMITED Company
Address: Km 1954 Quyet Thang Commune, Khanh Hau Sub-District, Tan An District, Long An Province.
Phone: 072.824665. FAX: 072.823664
Activity: Garment
267/ Long An Garment Export Company
Address: 7A National Road No. 1, District 4, Tan An Town, Long An Province.
Phone: 072.826280. FAX: 072.829412
Activity: Garment
39. Vinh Long
268/ Vinh Long EXPORT-IMPORT Company (IMEX CUU LONG)
Address: 5 Road 30 Apr., Vinh Long Town.
Phone: 823618. FAX: 070.823822
Activity: Garment and Trading
40. Tien Giang
269/ Tien Tien Garment Company
Address: Phong Thuan A Commune, Tan My Chanh Sub-District, My Tho City, Tien Giang Province.
Phone: 073.874276. FAX: 073.877962
Activity: Garment
270/ My tho Garment Export Enterprise
Address: 179 Phan Thanh Gian Road, Sub-District 2, My Tho City, Tien Giang Province.
Phone: 073.872579. FAX: 073.875930
Activity: Garment
271/ My tho Garment Enterprise
Address: 101 National Road No. 1, Trung An Sub-District, My Tho City, Tien Giang Province.
Phone: 073.855932. FAX: 073.855454
Activity: Garment
272/ Tien Giang General Trading Company
Address: 21-23 Le Van Duyet St., Sub-District 1, My Tho City
Phone: 073.872271, 073.872274. FAX: 073.874434
Activity: Garment and Trading
273/ Viet Tan Garment EXPORT LIMITED Company (TAVTEC)
Address: My Can Commune,, My Nhi Sub-District, Cai Lay District, Tien Giang Province.
Phone: 073.82930. FAX: 073.826427
Activity: Garment
41. Binh Duong
274/ Binh Duong Production and trade Company (PROTRADE Binh Duong).
Address: Dong Tu Commune, Lai Thieu Sub-District, Thuan An District, Binh Duong Province. Phone: 065-8-55579. FAX: 065-8-55040
Activity: Garment and Trading
275/ Binh Duong Garment Export Company
Address: Thu Dau Mot District, Binh Du¬ng Province.
Phone: 065.828013. FAX: 065.822794
Activity: Garment
276/ VIET NAM-Korea FIBERS Company
Address: 743 An Phu St., Thuan An Town, Song Be Province.
Phone: 065.825683. FAX: 065.825709
Activity: Garment
42. Ben Tre
277/ Viet Hong Garment Company
Address: 425B Province's Road No. 885, Sub-District 8, Ben Tre Town. Ben Tre Province.
Phone: 075.824990. FAX: 075.823485
Activity: Garment
43. Can Th¬par 278/ MEKO EXPORT Garment Enterprise
Address: Can Tho Export Processing Zone
Phone: 071.841298. FAX: 071.841330
Activity: Garment
279/ Tay Do Garment Company
Address: 73 Mau Than St., Can Tho Town, Can Tho Province.
Phone: 071.824385. FAX: 071.821645
Activity: Garment
44. Tay Ninh
280/ Vietnam MB LIMITED Company
Address: Sub-District 3, Tay Ninh Town, Tay Ninh Province.
Phone: 066.821455. FAX: 066.821456 (Branch Office: 89 Cong Hoa Road, Sub-District 4, District Tan Binh, HCM City.
Activity: Garment
281/ Tay Ninh 30 April General EXPORT-IMPORT Company
Address: A30 Le Loi Road, Sub-District 2, Tay Ninh Town, Tay Ninh Province.
Phone: 066.822197. FAX: 066.822532
Activity: Garment and Trading
45. HCM City
SOEs
282/ Sai Gon Woolen Textile Enterprise (SAKNITEX)
Address: 255 Hoang Van Thu St., Tan Binh District, HCM City.
Phone: 088.443365. FAX: 088.443228
Activity: Woollen Products
283/ Sai Gon Woolen, Embloidering and Carpet Company (WEC)
Address: 146 (4th Floor) Nguyen Cong Tru, District 1, HCM City.
Phone: 088.230879. FAX: 088.296581
Activity: Woollen, Embloidering and Carpet.
284/ Sai Gon Garment Manufacturing and EXPORT-IMPORT Company (GARMEX Sai Gon)
Address: 213 An Duong Vuong St., District 5, HCM City.
Phone: 088.557300. FAX: 088.557299
Activity: Garment and Trading
285/ Binh Tay EXPORT-IMPORT Company (BITEX)
Address: 78-82 Hau Giang St., District 6, HCM City.
Phone: 088.550109. FAX: 088.557846
Activity: Garment and Trading
286/ Sai Gon Garment Company 2
Address: 15 An Ton St., Tan Binh District, HCM City.
Phone: 088.640086. FAX: 088.640031
Activity: Garment
287/ Sai Gon Garment Company 3
Address: 86 Nguyen Thi Minh Khai St.,, District 3, HCM City.
Phone: 088.222403. FAX: 088.220619
Activity: Garment
288/ Leather Shoes and Garment Export Company (LEGAMEX)
Address: 15 Truong Son St., District 10, HCM City.
Phone: 088.640251. FAX: 088.641265
Activity: Garment and Shoes
289/ Art and EXPORT-IMPORT Company (ARTEX Sai Gon)
Address: 161 Dong Khoi St., District 1, HCM City.
Phone: 088.224192. FAX: 088.296496
Activity: Garment
290/ Gia Dinh Textile Garment Company (GIDITEXCO)
Address: 189 Phan Van Tri St., Binh Thanh District, HCM City.
Phone: 088.940509. FAX: 088.940291
Activity: Textile and Garment
291/ HCM City General Investment and EXPORT-IMPORT Company (IMEXCO)
Address: 45-47 Ben Chuong Duong St., District 1. HCM City.
Phone: 088.295190
Activity: Garment, Investment and Trading
292/ Industrial Product EXPORT-IMPORT Company (INEXIM)
Address: 275 B Pham Ngu Lao St., District 1, HCM City.
Phone: 088.394480. FAX: 088.399413
Activity: Garment and Trading
293/ Tien Phat Garment Enterprise
Address: 171A Hoang Hoa Tham St., Sub-District 13, District Tan Binh, HCM City.
Phone: 088.447514. FAX: 088.421806
Activity: Garment
294/ 27 July Enterprise
Address: 130 Ham Tu St., District 5, HCM City.
Phone: 088.353005. FAX: 088.458692
Activity: Garment
295/ Vietnam Youth Manufacturing and EXPORT-IMPORT service Company (V.Y. C)
Address: 922 Nguyen Trai St., Sub-District 14, District 5, HCM City.
Phone: 088.554800. FAX: 088.550776
Activity: Garment and Trading
296/ Seaproduct trading Company (APT Co)
Address: 1103-1105 Tran Hung Dao St., District 5. HCM City.
Phone: 350642. FAX: 351059
Activity: Trading and Garment
297/ HCM City Forestry Product Company
Address: 51B1 Nguyen Oanh St., Go Vap District. TP. HCM.
Phone: 941719. FAX: 942248
Activity: Garment and Trading
SOEs under Districts
298/ Binh Thanh Manufacturing EXPORT-IMPORT Company (GILIMEX)
Address: 24C Phan Dang Luu St., Binh Thanh District, HCM City.
Phone: 088.441044. FAX: 088.441042
Activity: Garment and Trading
299/ Garment EXPORT Enterprise (GAFATEX)
Address: 46B Hung Vuong St., Sub-District 16, District 11, HCM City.
Phone: 088. 550464. FAX: 088.558202
Activity: Garment
300/ Hoc Mon EXPORT-IMPORT and Investment Company (HOMEXCO)
Address: 161/2 National Road No. 22, District Hoc Mon, HCM City.
Phone: 088. 910514. FAX: 088.910254
Activity: Investment, Garment and Trading.
301/ Manufacturing and EXPORT-IMPORT Company (BIDEXIM)
Address: 175 Chanh Hung St., F4, District 8, HCM City.
Phone: 088.554092. FAX: 088.558976
Activity: Garment and Trading
301/ EXPORT-IMPORT Company (KHACOMEX)
Address: 2 Doan Nhu Hai St., District 4, HCM City.
Phone: 088. 292611. FAX: 224124
Activity: Garment and Trading
302/ Tan Binh Equipment Supplying Company (TAMEXIM)
Address: 192-194 Ly Thuong Kiet St., Sub-District, 8, District Tan Binh, HCM City
Phone: 088.643044. FAX: 088.640356
Activity: Garment and Trading
303/ Phu Nhuan Garment, Emploidering and EXPORT-IMPORT Company
Address: 111 Phan Dang Luu St., Sub-District 7, Phu Nhuan District, HCM City
Phone: 088.421180. FAX: 088.445385
Activity: Garment, Emploidering and Trading
304/ District III Garment EXPORT Enterprise (TRISEWMEX)
Address: 169-171 Cach Mang Thang Tam St.,, District 3, HCM City.
Phone: 088.395559. FAX: 088.392587
Activity: Garment
305/ Cho Lon Investment and EXPORT-IMPORT Company (CHOLIMEX)
Address: 613a-633 Nguyen Trai St.,, District 5. HCM City.
Phone: 088.555674. FAX: 088.555682
Activity: Garment and Trading
306/ HCM City Commercial Cooperative Union (Sai Gon COOP)
Address: 199-205 Nguyen Thai Hoc St., District 1, HCM City.
Phone: 088. 2284645. FAX: 228469
Activity: Garment and Trading
307/ Binh Chanh EXPORT-IMPORT Corporation (BICHIMEX CORP)
Address: 79 An Duong Vuong St., An Lac Sub-District, Binh Chanh District, HCM City.
Phone: 754057. FAX: 753601
Activity: Garment and Trading
308/ Commercial and EXPORT-IMPORT service Company (TENIMEX)
Address: 469 Le Hong Phong St.,, District 10, TP. HCM.
Phone: 8358941. FAX: 8354240
Activity: Garment and Trading Services
Joint-Stock Companies and limited Companies in HCM City
1/ 30 April Leather Garment EXPORT Joint-Stock Company
Address: Industrial Zone, Sub-District 9, Phu Nhuan District, HCM City.
Phone: 088.44667. FAX: 088.44464
Activity: Leather Garment
2/ Fashion Joint-Stock Company (MTT)
Address: 25/9 Vo Van Ngan St., Thu Duc District, HCM City.
Phone: 088.966677. FAX: 088.966039
Activity: Garment
3/ Tan Tien Garment and Embloidering Joint-Stock Company
Address: 118/8B Thong Nhat St., Sub-District 11, Go Vap District, HCM City.
Phone: 088.942534. FAX: 088.940380
Activity: Garment and Embloidering
4/ Thuan Phuong Garment and Embloidering LIMITED Company
Address: 271-273 Nguyen Van Luong St., District 6, HCM City.
Phone: 088.752189. FAX: 088.752038
Activity: Garment and Embloidering
5/ Phu Ha Industrial and Commercial LIMITED Company (FUHACO)
19 Nguyen Van Th_, Sub-District Dakao, District 1
Phone: 088.297114. FAX: 088.297648
6/ Huy Hoang Garment and Construction Joint-Stock Company
Address: 128B Phan Dang Luu St., Phu Nhuan District, HCM City.
Phone: 088.443503. FAX: 088.44153
Activity: Garment and Construction
7/ Minh Phung Garment Manufacturing, Commercial and Construction LIMITED Company
Address: 210 Lac Long Quan St., Sub-District 5, District 11, HCM City.
Phone: 088.601304. FAX: 088.650304
Activity: Garment, Construction and Trading
8/ Thanh Tam Garment LIMITED Company
Address: 36/9A Quang Trung St.,, Go Vap District, HCM City.
Phone: 088.942097. FAX: 088.945701
Activity: Garment
9/ Quoc Tuan Garment and Embloidering LIMITED Company
Address: 55373A Nguyen Kiem St., Phu Nhuan District, HCM City.
Phone: 088.462132. FAX: 088.455010
Activity: Garment and Embloidering
10/ Chinh Hung Manufacturing LIMITED Company
Address: 68/615 Nguyen Thuong Hien St., Sub-District 1, Go Vap District, HCM City.
Activity: Garment
11/ Viet Hung Garment LIMITED Company
10/20 L¹c Long quan, F9, District Tan Binh
Phone: 088.654709. FAX: 088.654709
Activity: Garment
12/ Cho Lon Company LIMITED Garment (GARMEX Cho Lon)
Address: 25 Dao Duy Tu St., District 10, HCM City.
Phone: 088.551041. FAX: 088.561780
Activity: Garment
13/ Hoang Gia Garment and Embloidering LIMITED Company
Address: 144 Tran Phu St., District 5, HCM City.
Phone: 088.350993. FAX: 088.399522
Activity: Garment and Embloidering
14/ Pacific Garment LIMITED Company
Address: 166/34 Thich Quang Duc St., Sub-District 4, Phu Nhuan District, HCM City.
Phone: 088.443410
Activity: Garment
15/ Phung Hoang Garment LIMITED Company
Address: 422 Ho Van Hue St., District Phu Nhuan, HCM City.
Phone: 088.449161. FAX: 088.449160
Activity: Garment
16/ Minh Hoang Garment LIMITED Company
Address: 9 Le Thanh Ton St., District 1, HCM City.
Phone: 088.229349. FAX: 088.293775
Activity: Garment
17/ Kim Nam Garment and trading LIMITED Company
Address: 1AB Tran Xuan Soan St., Nha Be District, HCM City.
Phone: 088.728502. FAX: 088.728502
Activity: Garment and Trading
18/ Sing Viet Garment LIMITED Company (SINVICO)
Address: 103/7 Road No. 39, Sub-District 16, District 11, HCM City.
Phone: 088.559025. FAX: 088.421602
Activity: Garment
19/ Tan Chau Garment and EXPORT LIMITED Company
Address: 65/5 Thuan Kieu St., Tan Thoi Nhat Sub-District, Hoc Mon District, HCM City.
Phone: 088.916311. FAX: 088.910661
Activity: Garment and Trading
20/ Kim Thanh Textile Garment LIMITED Company
Address: 279 Tran Van Kieu St., Sub-District 3, District 6, HCM City.
Phone: 088.551166
Activity: Textile and Garment
21/ Nam Phu Garment LIMITED Company (NAPHUCO)
Address: 545 Huynh Van Banh St., Sub-District 14, Phu Nhuan District, HCM City.
Phone: 088.961440. FAX: 088.992297
Activity: Garment
22/ Quang Minh Garment LIMITED Company (KAMICO)
Address: 215-217 Nguyen Van Luong St., Sub-District 11, District 6, HCM City.
Phone: 088.751491. FAX: 088.751491
Activity: Garment
23/ Truong Duong Garment and Embloidering LIMITED Company
Address: 28 Kim Bien Road, Sub-District 13, District 5, HCM City.
Phone: 088.550792. FAX: 088.552146
Activity: Garment and Embloidering
24/ South Asia Garment LIMITED Company
Address: 18A Hoang Dieu St., Sub-District 10, Phu Nhuan District, HCM City.
Phone: 088.440368. FAX: 088.458511
Activity: Garment
25/ Hai Son Garment Manufacturing LIMITED Company
Address: 390 Hoang Van Thu St., Sub-District 4, Tan Binh District, HCM City.
Phone: 088. 424955. FAX: 088.446767
Activity: Garment
26/ Thai Binh Garment and consumer goods Manufacturing LIMITED Company
Address: 217A Nguyen Van Thu St., District 1, HCM City.
Phone: 088.225120. FAX: 088.223740
Activity: Garment and Comsumer Goods
27/ Vinh Loi Garment LIMITED Company
Address: 176 Tran Hung Dao B St., Sub-District 7, District 5, HCM City.
Phone: 088.558934. FAX: 088.551574
Activity: Garment
28/ Anh Tai Garment LIMITED Company
Address: 188 Tran Quang Khai St., Tan Dinh Sub-District, District 1, HCM City.
Phone: 088.444164. FAX: 088.439071
Activity: Garment
29/ Duy Thang LIMITED Company
Address: 337-345 Tan Ky St., Sub-District 16, Tan Binh District, HCM City.
Phone: 088.425310. FAX: 088.399087
Activity: Garment and Trading
30/ Kim Son Fashion Embloidering and Garment LIMITED Company
Address: 34 Bui Thi Xuan St., District 1, HCM City.
Phone: 088.394270. FAX: 088.399087
Activity: Garment and Embloidering
31/ Hoan Cau Garment LIMITED Company
Address: Ton Tu Block, Truong Tho Sub-District, Thu Duc District, HCM City.
Activity: Garment
32/ Tan Phu Cuong Industrial and Commercial LIMITED Company (TAPHUCO)
Address: 59-60 Truong Dinh St., Sub-District 13, District Tan Binh, HCM City.
Phone: 088.640811. FAX: 088.640810
Activity: Garment and Trading
33/ Hien Dat Garment and Embloidering LIMITED Company
Address: 42/42 Commune Road No. 13, Sub-District 15, Tan Binh District, HCM City.
Phone: 088.645903. FAX: 088.640824
Activity: Garment and Embloidering
34/ Hong Thai Garment LIMITED Company
Address: 67 BIS Commune Road No. 14, Tan Binh District, HCM City.
Phone: 088. 561158. FAX: 088.563985
Activity: Garment
35/ Sai Gon Garment EXPORT-IMPORT LIMITED Company
Address: 553/71 Nguyen Kiem St., Phu Nhuan District, HCM City.
Phone: 088.444598. FAX: 088.441911
Activity: Garment and Trading
36/ Tran Thanh Cong Textile, Garment and Embloidering Enterprise (TTC)
Address: 185 Nguyen Oanh St., Go Vap District, HCM City.
Phone: 088.940184. FAX: 088.941270
Activity: Textile, Garment and Embloidering.
37/ MAIKA Garment Company (MAIKAFA)
Address: 45B Tan Ky St., Binh Hung Hoa Sub-District, Binh Chanh District, HCM City.
Phone: 088.755206. FAX: 088.755205
Activity: Garment
38/ Mai Son Hai Garment Company
Address: 3 Tran Xuan Hoa St., District 5, HCM City.
Phone: 088.556354. FAX: 088.556354
Activity: Garment
39/ Tan Minh Textile, Garment and Commercial LIMITED Company
Address: 38 ABC (340/38/1) Dong Ho St., Tan Binh District, HCM City.
Phone: 088.644517. FAX: 088.640434
Activity: Textile, Garment and Trading
40/ Lien Phuong Garment Company (LIGARIMEX)
Address: 4 Viet Thang St., Linh Trung Sub-District, Thu Duc District, HCM City.
Phone: 088.966507. FAX: 088.963184
Activity: Garment
41. Kien Phuc Construction LIMITED Company
Address: 130 Tran Nao St., Binh An Sub-District, District 2, HCM City.
Phone: 088.992564. FAX: 088.992564
Activity: Garment
42/ Hong Ngoc Garment and Embloidering Company
Address: 5 Quang Trung St., Go Vap District and 234 Pasteur, District 3, HCM City.
Phone: 088.941453
Activity: Garment and Embloidering
43/ HCM City Youth Company
Address: 922 Nguyen Trai St., Sub-District 14, District 5, HCM City.
Phone: 088.8554800
Activity: Garment
44/ Sai Gon Fashion Garment and leather shoes LIMITED Company
Address: 15 Vo Van Tan St., Sub-District 6, District 3, HCM City.
Phone: 088. 910473. FAX: 088.910948
Activity: Garment and Shoes
45/ An Phu Chau Industrial and Commercial LIMITED Company
Address: New Commune, Phuoc Long Sub-District, Thu Duc District, HCM City.
Phone: 088.962523. FAX: 088.961701
Activity: Garment and Trading
46. Khai Hoan Garment and Embloidering LIMITED Company
Address: 2B Cong Hoa St., Tan Binh District, HCM City.
Phone: 088.426395
Activity: Garment and Embloidering
47/ Phuc Yen Garment LIMITED Company
Address: 434 Pham Van Hai St., Tan Binh District, HCM City.
Phone: 088.441726. FAX: 088.446361
Activity: Garment
48/ An Phuoc Garment and Embloidering LIMITED Company
Address: 100/11-12-13 An Duong Vuong St., District 5, HCM City.
Phone: 088.350059. FAX: 088.350058
Activity: Garment and Embloidering
49/ Toan Thang Manufacturing and Commercial service LIMITED Company
Address: 128 Phan Dinh Phung St., Phu Nhuan District, HCM City.
Phone: 088. 919184. FAX: 088.7010088
Activity: Garment and Trading Services
50/ Song Hoa Manufacturing LIMITED Company
Address: 1004A Au Co Road, Sub-District 19, Tan Binh District, HCM City.
Phone: 088.656050
Activity: Garment
51/ Hung Phuc Garment LIMITED Company
Address: 64/1 Commune Road No. 14, Tan Binh District, HCM City.
Activity: Garment
52/ Hong Phuc Garment LIMITED Company
Address: 1908 Lac Long quan St., Sub-District 10, Tan Binh District, HCM City.
Phone: 088.8551025
Activity: Garment
53/ Ky Manufacturing Company
Address: 231/48 Ton That Thuyet, Sub-District 3, District 4, HCM City.
Phone: 088.917411. FAX: 088.917412
Activity: Garment
54/ Dong Hoa Textile Garment LIMITED Company
Address: 306/8 Cach Mang Thang Tam St., Sub-District 13, Tan Binh District, HCM City.
Phone: 088.442018. FAX: 088.442018
Activity: Textile and Garment
55/ Thien An Garment and Embloidering LIMITED Company
Address: 299/22 Ly Thuong Kiet St., District 11, HCM City.
Phone: 088.652485
Activity: Garment and Embloidering
56/ Lien Phuong Industrial and commercial LIMITED Company
Address: 97 Nguyen Dinh Chieu St., Sub-District 7, District 3, HCM City.
Phone: 088.241626. FAX: 088.223563
Activity: Garment and Trading
57/ Thanh Hung Commercial service LIMITED Company
Address: 152B Thich Quang Duc St., Sub-District 4, Phu Nhuan District, HCM City.
Phone: 088.950245. FAX: 088.950885
Activity: Garment and Trading
58/ Phuong Khoa Garment and Embloidering LIMITED Company
Address: 269 Nguyen Van Luong St., District 6, HCM City.
Phone: 088.751747. FAX: 088.752038
Activity: Garment and Embloidering
59/ Son Cu Enterprise
Address: 1009B Commune Road No. 2, Sub-District 19, Tan Binh District, HCM City.
Activity: Garment
60/ Long Hai Trading LIMITED Company
Address: 65 Vo Van Tan St., District 3, HCM City.
Phone: 088.298243. FAX: 088.299404
Activity: Garment and Trading
61/ Thanh Tin Industrial and Commercial LIMITED Company
Address: 6/72 Road 3 Feb., District 10, HCM City.
Phone: 088.627090. FAX: 088.627089
Activity: Garment and Trading
62/ Vinh Phat Manufacturing and Commercial LIMITED Company
Address: 11/9 Kha Van Can St., Linh Trung Sub-District, Thu Duc District, HCM City.
Phone: 088.961507. FAX: 088.963837
Activity: Garment and Trading
63/ Van Thang trading LIMITED Company
Address: 2623 Pham The Hien St., Sub-District 7, District 8, HCM City.
Phone: 088.500969. FAX: 088.500972
Activity: Garment and Trading
64/ Binh Son Garment LIMITED Company
Address: 1119 Xo Viet Nghe Tinh St., Binh Thanh District, HCM City.
Phone: 088.605004. FAX: 088.605003
Activity: Garment and Trading
65/ Nam Thang Garment and Embloidering LIMITED Company
Address: 357/6B Commune Road No. 14, Sub-District 19, Tan Binh District, HCM City.
Activity: Garment and Embloidering
66/ Tuong Hung trading LIMITED Company
Address: Block 5, Commune 2, Tan Thoi Hiep Sub-District, Hoc Mon District, HCM City.
Phone: 088.911025. FAX: 088.911090
Activity: Garment and Trading
67/ Lan Anh Garment, Embloidering and Trading LIMITED Company
Address: 117-119 Truong Dinh St.,, District 3, HCM City
Activity: Garment, Embloidering and Trading
68/ Tuan Nha Garment LIMITED Company
Address: 142/1A An Lac Town, Binh Chanh District, HCM City.
Phone: 088.754640. FAX: 088.760867
Activity: Garment
69/ Viet Ha Garment LIMITED Company
Address: 411 Le Van Si St., Sub-District 12, District 3, HCM City.
Phone: 088.436374. FAX: 088.436374
Activity: Garment
70/ Dai Son washing and Trading LIMITED Company
Address: 229 Ton That Hiep St., Sub-District 12, District 11, HCM City.
Phone: 088.861298. FAX: 088.8563216
Activity: Garment, Laundry and Trading
71/ Vinh Loi Garment LIMITED Company
Address: 176 Tran Hung Dao B St., Sub-District 7, District 5, HCM City.
Phone: 088.558934. FAX: 088.551574
Activity: Garment
72/ Thuan Thao Commercial and service LIMITED Company
Address: 6B5 Hung Vu¬ng St., Sub-District 1, District 10, HCM City.
Phone: 088.8350787. FAX: 088.351178
Activity: Garment and Trading
73/ Kim Buu Commercial and service LIMITED Company
Address: 112/14-16 Truong Cong Dinh St., Tan Binh District, HCM City.
Phone: 088.8491917. FAX: 088.3497443
Activity: Garment and Trading
74/ Hai Phong Garment LIMITED Company
Address: 184C Le Van Si St., Sub-District 10, Phu Nhuan District, HCM City.
Phone: 088.0463648. FAX: 088.8441945
Activity: Garment
75/ Truong Hai Garment EXPORT Company
Address: 360 Le Van Si, District 3, HCM City.
Phone: 088.910705
Activity: Garment
76/ Toan Thang Transportation LIMITED Company
Address: 196 Cong Hoa St., Sub-District 12, Tan Binh District, HCM City.
Phone: 088.421971. FAX: 088.421971
Activity: Transportation and Garment
77/ Hiep Thanh Garment and Commercial Company
Address: 168-182 Duong Ba Trac St., Sub-District 2, District 8, HCM City.
Phone: 088.569372. FAX: 088.516367
Activity: Garment and Trading
78/ Binh Dong Garment LIMITED Company
Address: 301B-C Ben Binh Dong St., Sub-District 14, District 8, HCM City.
Phone: 8563875
Activity: Garment
79/ Viet Pho LIMITED Company
Address: 3 An Duong Vuong St., Sub-District 10, District 6, HCM City.
Activity: Garment
80/ Toan Thang Commercial and service LIMITED Company
Address: 186 Thach Loc St., District 12, HCM City
Phone: 8919184. FAX: 8919459.
Activity: Garment and Trading
Join-Ventures in HCM City
1/ HONGAMEX Join-Venture Company
Address: 333 Commune Road No. 14, Sub-District 19, Tan Binh District, HCM City.
Phone: 088.648801. FAX: 088.648242
Activity: Garment
2. Vietnam LUCKY LIMITED Company
Address: D1 9T Province Road No. 10, Ba Hom Commune, Tan Tao Sub-District, Binh Chanh District, HCM City.
Phone: 088. 754901. FAX: 754900
Activity: Garment
3/ Hoang Viet international LIMITED Company
Address: Road Tan Thuan, Tan Thuan Export Processing Zone, Nha Be District, HCM City.
Phone: 088.728429. FAX: 728432
Activity: Garment and Trading
4/ Vietnam Industrial PALACE LIMITED Company
Address: Road No. 3, Tan Thuan Export Processing Zone, Nha Be District, HCM City.
Phone: 088.720904. FAX: 088.720901
Activity: Textile and Garment
5/ Viet Hung LIMITED Company (EVER PROSPERITY Co.Ltd)
Address: Tan Thuan Export Processing Zone, Nha Be District, HCM City.
Phone: 088.729450. FAX: 088.729935
Activity: Garment
6/ vietnam DAH SHENG international Garment EXPORT Joint-venture Company
Address: 281/1 Hoang Sao Commune, Tan Chanh Hiep Sub-District, Hoc Mon District, HCM City.
Phone: 088.910186. FAX: 910164
Activity: Garment
7/ DAEWOONGS Company
Address: D1/9T Province Road No. 10, Ba Hom Commune, Tan Tao Sub-District, Binh Chanh District, HCM City.
Phone: 088.914555
Activity: Garment
8/ vietnam TRIUMPH LIMITED Company
Address: 20/6 Vo Van Ngan St., Thu Duc District, HCM City.
Phone: 088.960137. FAX: 088.960133
Activity: Underwear
9/ MOUNTECH LIMITED Company
Address: Ho Van Hue Industrial Zone, Sub-District 9, Phu Nhuan District, HCM City.
Phone: 088.446159. FAX: 088.441670
Activity: Garment
10/ MARIXON Textile Garment EXPORT Company
Address: 25/5 Hoang Viet St., Sub-District 4, Tan Binh District, HCM City.
Phone: 088. 442177. FAX: 088.443320
Activity: Textile and Garment
11/ vietnam UPGAIN Manufacturing LIMITED Company
Address: Linh Trung Export Processing Zone, Thu Duc District, HCM City.
Phone: 088.967153. FAX: 088.967154
Activity: Garment
12/ Viet Cang Garment LIMITED Company
Address: A13/29 Ten Lua Road, Binh Tri Dong Sub-District, Binh Chanh District, HCM City.
Phone: 088.752090. FAX: 750479
Activity: Garment
13/ SHING VIET Join-venture lien doanh limited Company
Address: Km 9 Hanoi Highway, Thu Duc District, HCM City.
Phone: 088.966947. FAX: 088.966952
Activity: Garment
14/ Woolen Textile EXPORT joint-venture Company (MAGNICON)
Address: 281/2 Hang Sao Commune, Tan Chanh Hiep Sub-District, Hoc Mon District, HCM City.
Phone: 088.910166. FAX: 088.911193
Activity: Woollen Clothing
15/ Choongnam Viet Thang joint-venture Ltd Company
Address: Linh Trung Sub-District, Thu Duc District, HCM City.
Phone: 088.966936. FAX: 088.960181
Activity: Textile and Garment
16. vietnam SCAVI Company
Address: 735 An Dien St., Thu Duc District, HCM City.
Phone: 088.999523. FAX: 088.990372
Activity: Textile and Garment
17/ Phong Phu COATS TOOTAL joint-venture Company
Address: Tang Nhon Phu Sub-District, Thu Duc District, HCM City.
Phone: 088.964054. FAX: 088.964052
Activity: Textile and Garment
18/ Vietnam ELAND Company
Address: Road No. 8, Phuoc Binh Sub-District, District 9, HCM City.
Phone:
Activity: Garment
19/ YASUDA LIMITED Company
Address: Road No. 14, Tan Thuan Export Processing Zone, Nha Be District, HCM City.
Phone: 088.721353. FAX: 088.721615
Activity: Textile and Garment
20. KOLLAN (VN) LIMITED Company
Address: Linh Trung Export Processing Zone, Thu Duc District, HCM City.
Phone: 088.969426. FAX: 088.969428
Activity: Garment
21/ MSA joint-venture Company
Address: 18 Phan Van Tri St., Go Vap District, HCM City.
Phone: 088.943821. FAX: 088.943823
Activity: Garment
22/ GOLAS Vietnam LIMITED Company
Address: 90 KC/B Hoa Binh Road, Sub-District 20, Tan Binh District, HCM City.
Phone: 84 - 8 - 8609210. FAX: 84 - 8 - 860920
Activity: Garment
23/ VIVA Company
Address: Road No. 1, Tan Thuan Export Processing Zone, Nha Be District, HCM City.
Activity: Garment
24/ Hanjoo Viet Thang joint-venture Company
Address: Linh Trung Commune, Thu Duc District, HCM City.
Phone: 088.966012. FAX: 088.966013
Activity: Textile and Garment
25/ Duc Bon manufacturing LIMITED Company (Delphi Industry Co. Ltd.)
Export Processing ZoneTan Thuan
Phone: 088.729460. FAX: 088.729454
Activity: Garment
26/ Sweneo-Vietnam international LIMITED Company
Address: Road No. 8, Tan Thuan Export Processing Zone, Nha Be District, HCM City.
Phone: 088.729467. FAX: 088.729431
Activity: Garment
27/ Ti Hua-Vietnam LIMITED Company
Address: 65/5 Thuan Kieu St., Tan Thoi Nhat Sub-District, District 12, HCM City.
Phone: 088.912050
Activity: Garment
28. Vinh Hung limited Company
Address: 1365/1A National Road No. 1, An Phu Dong Sub-District, District 12, HCM City.
Activity: Garment
National assembly Socialist Republic of Vietnam
Independence-Freedom-Happiness
Law 03/1998/QH10
Hanoi, May 18, 1998
National Assembly of the Socialist Republic Of Vietnam
Tenth Legislature-Section 3
(From April 21 to May 20,1998)
Law on domestic investment encouragement
(Amendment)
In order to effectively mobilize and use every capital source, natural resources, labour forces and other potential available in the country to contribute to the socio-economic development and for the prosperity of the people, the power of the country and the/society's justice and civilisation;
Pursuant to the Socialist Republic of Vietnam's Constitution promulgated in 1992;
The Law hereby provides regulations on domestic investment encouragement.
Chapter I General Provisions
Article 1:
The State protects, encourages, equally treats and creates favorable conditions for organizations and individuals investing in socio-economic fields in the territory of Vietnam and in accordance with Vietnam's existing regulations and laws.
Article 2:
As per in this Law, some terms will be understood as follows:
1. 'Domestic investment' is the use of capital in production and business in Vietnam by organisations and individuals as regulated in Article 5 of this Law.
2. "Investor' is an organisation or an individual investing capital as regulated in Article 4 of this Law.
3. 'Build-Operate-Transfer' (BOT) contract is a document signed between a State authorised body and an investor to build and trade an infrastructure project during a certain period agreed by the two parties; after which, the investor has responsibility to transfer the construction to the State without receiving any return.
4. ' Build-Transfer-Operate' (BOT) contract is a document signed between a State authorised body and an investor to build an infrastructure project, which when completed, the investor has responsibility to transfer the construction to the State. The State authorised body signs a contract allowing the investor to trade the construction in a certain period agreed by the two parties.
5. "Build-Transfer' (BT) contract is a document signed between a State authorised body and an investor to build an infrastructure project, after completion, the investor has responsibility to transfer the construction to the State. The State authorised body signs a contract creating conditions for the investor to carry out other projects to recover investment capital and earn a profit.
6. "Vietnamese residing abroad' are Vietnamese citizens and people who have Vietnamese origin and have worked and lived abroad for a long period of time.
7. 'Foreigners permanently living in Vietnam' are foreign citizens and people without nationality living and working in Vietnam for a long period of time.
8. 'Regions with difficult economic and social conditions' are areas in which minority people live, mountainous areas, areas with underdeveloped infrastructure and areas facing unfavourable natural conditions.
9. 'Regions with particularly difficult economic and social conditions' are mountainous areas in which minority people live, islands, areas with seriously poor infrastructure, and areas always facing unfavourable natural conditions.
Article 3:
Investors are allowed to use the following currencies and assets to invest in Vietnam:
1. Vietnamese dong and foreign currencies;
2. Gold and transferable stocks;
3. Workshops, construction, equipment, machinery and business and production instruments;
4. The value of land use rights as stipulated in Vietnam's existing regulations and laws on land;
5. The value of the intellectual property rights, technical know-how and technological process;
6. Other legal properties.
Article 4:
Scope of application of this Law includes the following investment activities:
1. Investing in the establishment of business and production units in all economic sectors;
2. Investing in building production lines, expanding operational scale, renovating technology, improving ecological environment, removing production units to suburban areas, raising business and production capacity, restructuring production activities and diversifying products and professions;
3. Buying shares in businesses and contributing capital to businesses belonging to all economic sectors;
4. Investing under BOT, BTO and BT contracts.
Article 5: 1. Entities subject to this Law include:
a) Investors are Vietnamese organisations and individuals;
b) Investors are Vietnamese people residing abroad;
c) Investors are foreigners living in Vietnam for a long period of time.
2. The Prime Minister will deal which specific cases, allowing foreign investors to contribute capital and buy shares in Vietnamese businesses at a level of not more than 30 percent of the business's legal capital.Chapter II
Investment Support and Guarantee
Article 6:
1. The State recognises and protects the rights on property ownership, investment capital, income and other legal rights and benefits of investors.
2. Legal properties and investment capital of investors will not be nationalised or appropriated through administrative measures.
In case of necessity for national defense, security and interest, the State decides to make a compulsory purchase or requisition the property of the investor, the investor will be paid or compensated according to the market prices at time of purchase or requisition, and will be provided with favourable conditions in order to invest in appropriate sectors and regions.
3. In cases where changes of regulations and laws damage investor benefits, the State will allow the investor to continue enjoying preferences for the remaining period of time, or the State will issue appropriate policies to meet the rights of the investor.
Article 7:
The State will apply the following measures to provide favourable conditions for the investor to have a land area or to expand their avail able area for production and business operation:
1. To allocate or lease land areas in conformity with the lawful regulations on land and civil laws;
2. To publicise the plans of the approved land uses, the unused land and the land areas to be allocated or leased, which are available in localities;
3. The Government will submit to the National Assembly Standing Committee the detailed regulations on the case where the investor has the right to transfer, assign, re-lease, mortgage, or inherit the allocated or leased land areas.
Article 8:
The State will support and provide favourable conditions of infrastructure for the investor as follows:
1. To build industrial zones on medium and small scales in regions with difficult economic and social conditions and regions with particularly difficult economic and social conditions, which the investor will use as areas for production and business operation with granted preferences;
2. To perform infrastructure construction outside industrial zones (IZs) and export processing zones (EPZs), in order to provide favourable conditions for activities of investment, production and business operation; 3. To encourage and provide favourable conditions for the investor to form production and business operation units in IZs, EPZs and economic zones.
Article 9:
The State will provide capital for production and business operation units located in regions with difficult economic and social conditions and regions with particularly difficult economic and social conditions through State enterprises and State credit organisations.
Article 10:
The State will form and encourage the formation of investment and export assistance funds from the State Budget, credit organisations, enterprises, organisations and individuals at home and abroad. The investment assistance fund will provide medium and long term loans at a preferential interest rate, give a part of the interest for the projects that are granted preferences, and offer investment credit at a preferential interest rate, in order to help enterprises develop their production of export items, trade export items, expand export markets, and as well provide export credit guarantees.
The operation of investment and export assistance funds is subject to the Law on Credit Organisations.
Article 11:
1. The State encourages the publicity and transfer of technology, and provides favourable conditions for the investor to apply the technology invested from the State Budget at preferential charges.
2. The State forms an assistance fund for the development of science and technology from its budget, credit organisations, enterprises, organisations and individuals at home and abroad, in order to provide loans at favourable conditions, and preferential interest rate, for the investor to study and apply advanced technology, and to transfer and renovate technical inventions and technology.
The regulations on the organisation and operation of the assistance activities:
1. Advice on regulations and laws, investment, business operation, and enterprise management;
2. Training workers, technicians, retraining and improving professional qualifications and economic management;
3. Supplying market information, scientific and technical inventions and technology, protecting intellectual property rights and transferring technology;
4. Marketing and promoting commercial activities;
5. Establishing professional associations of production, business, and export.
Article 13:
The investment project of the investor who is subject to Article 5 of this Law will be applied the same price rates, pay the same taxes, and enjoy the same investment preferences as those applicable to the commodities ad services that are subject to the State regulations.
Article 14:
In the cases where the local technical experts and workers cannot meet the demands of professional knowledge or qualifications, the investor may hire foreign technical experts and workers, Vietnamese residing abroad, or foreigners permanently living in Vietnam for a long period of time, in accordance with the scope of production and business operation of the enterprise.
The technical experts and workers being foreigners, Vietnamese residing abroad and foreigners permanently living in Vietnam for a long period of time, who are employed by the local production and business operation units can remit their incomes out of Vietnam after having paid income tax as regulated by Vietnam's existing regulations and laws.
Chapter III
Investment Preferences
Article 15:
Preferences will be granted to the projects that invest in the following sectors:
1. Planting forest and afforesting; developing perennial cash crops on desert land, barren hills; reclaiming waste land; producing salt; and rearing maritime produce in unexploited waters;
2. Developing infrastructure and public means of transport; improving activities on education, training, health care and national culture;
3. Producing and trading export items;
4. Deep-sea fishing; processing agricultural, forestry and maritime produce and providing direct technical services for agricultural, forestry and maritime production;
5. Studying, developing science, technology and scientific and technological services; advice on regulations and laws, investment, business operation and enterprise management; protecting intellectual property rights, transferring technology; training workers and technicians;
retraining and improving knowledge of business management;
6. Investing in production lines, expanding the scope of production, renovating technology, improving ecological systems and environment, urban hygiene, relocating production units to suburban areas; formalising variety of professions and products, and investing in such professions that employ many local workers;
7. Developing professions that need preferences as required in specific economic and social development periods.
Article 16:
Preferences will be granted to the investment projects developed in the following regions:
1. Regions with difficult economic and social conditions.
2. Regions with particularly difficult economic and social conditions.
Article 17:
1. Investors of projects stated in Article 15 of this Law will be given a 50 percent reduction of the land rental, if the allocated land requires a usage fee.
2. Investor of projects developed in regions with difficult economic and social conditions will be given a 75 percent reduction of the land rental, if the allocated land requires a usage fee.
3. Investor of projects developed in regions with particularly difficult economic and social conditions, or with the projects stated in Article 15 of this Las and developed in regions with difficult economic and social conditions will be given an exemption of the land rental, if the allocated land requires a usage fee.
Article 18:
1. Investor of projects stated in Article 15 of this law will given a land rental exemption for three to six years from the date of the land lease contract being signed.
2. Investor of projects developed in regions with difficult economic and social conditions will be given a land rental exemption for seven to ten years from the date of the land lease contract being signed.
Investor of projects stated in Article 15 of this Law and developed in regions with difficult economic and social conditions will be given a land rental exemption for 11 to 15 years from the date of the land lease contract being signed.
3. Investor of projects developed in regions with particularly difficult economic and social conditions will be given land rental exemption for 11 to 15 year from the date of the land lease contract being signed.
Investor of projects stated in Article 15 of this Law and developed in regions with particularly difficult economic and social conditions will be given a land rental exemption for the entire duration of the project development.
Article 19:
1. Investor of projects stated in Article 15 of this Law will be given an exemption of the land use tax if they are given land.
Investor of projects stated in Article 15.2 of this Law will be given a 50 percent reduction of the land use tax for seven to ten years from the date of the land being given.
2. Investor of projects developed in regions with difficult economic and social conditions will be give a exemption of the land use tax for seven to ten years from the date of the land being given.
Investor of projects stated in Article 15 of this Law and developed in regions with difficult economic and social conditions will be given an exemption from the land use tax for 11 to 15 years from the date of the land being give.
3. Investor of projects developed in regions with particularly difficult economic and social conditions will be given an exemption of the land use tax for 11 to 15 years from the date of the land being given.
Investor of projects stated in Article 15 of this Law and developed in regions with particularly difficult economic and social conditions will be given an exemption of the land use tax for whole duration of the project development.
Article 20:
Investor of projects stated in Article 15 and 16 of this law will be subject to the business income tax at the following rates:
1. Investor of projects stated in Article 15 of this law, or investing in regions with difficult economic and social conditions will apply a tax rate of 25 percent;
2. Investor investing in regions with particularly difficult economic and social conditions, or investing in the sectors stated in Article 15 of this Law in regions with difficult economic and social conditions will apply a tax rate of 20 percent;
3. Investor investing in the sectors stated in Article 15 of this law in regions with particularly difficult economic and social conditions will apply a tax rate of 15 percent.
Article 21:
1. Investor of projects that establish production and business operation entities in the sectors stated in Article 15 of this Law will be given an exemption, or reduction of the business income tax which is stated in Article 17.1.b of the Law on Business Income Tax.
2. Investor of projects that establish production and business operation entities in the regions stated in Article 16 of this Law , or investor investing in the forms of BOT contracts or BTO contracts, will be given an exemption, or reduction of the business income tax with the first preferences stated in Article 17.1.b of the law on Business Income Tax.
Article 22:
Investor of projects stated in Article 15.6 of this Law, in addition to being given exemption of reduction of the business income tax as stated in Article 18 of the Law on Business Income Tax, will have the right on the following preferences.
1. Being given a 50 percent reduction of the business income tax to be paid during the next two years applicable to the additional income which is earned from the current investment;
2. Being given an exemption of the business income tax to be paid during the next two years, and a 50 percent reduction of the business income tax to be paid during the following three years, applicable to the additional income which is earned from the current investment of the production and business operation establishments that are located in regions with difficult economic and social conditions;
3. Being given an exemption of the business income tax to be paid during the next three years, and a 50 percent reduction of the business income tax to be paid during the following five years, applicable to the additional income which is earned from the current investment of the production and business operation establishments that are located in regions with particularly difficult economic and social conditions.
Article 23:
Investor of projects stated in Article 16 and 16 of this Law will not have to pay the additional income tax as stated in Article 10.1 of the law on Business Income Tax.
Article 24:
1. Individual investors will be given an exemption of the income tax applicable to their income which is earned by contributing capital, and purchasing shares in businesses for five years from the date of the investor being subject to tax payment as regulated in the Law on Individual Income Tax.
2. Individual investor will be given an exemption of the income tax applicable to their income which is earned by contributing capital, purchasing shares in businesses in the regions stated in Article 16 of this Law, for ten years from the date of the investor being subject to tax payment as regulated in the Law on Individual Income Tax.
3. Investor who contribute capital through intellectual property rights, technical know-how and technological process will be given an exemption of the income tax which is earned from this contribution.
Article 25:
Investor of projects stated in the Article 15 and 16 of this Law will be given an exemption of the import tax applicable to the following categories, which are not produced locally or which are available at home but do not satisfy the requirements:
1. Professional equipment, machinery and means of transport that are included in the technological line in order to build up fixed assets of enterprises, or to expand the scope of investment and renovate the technology;
2. Means of transport used for carrying workers and staff.
Article 26:
In addition to the preferences in the business income tax stated by this Law, investor of production entities and export products trading establishments will be given more preferences in the business income tax as follows:
1. Being given a 50 percent reduction of the business income tax to be paid for the additional income which is earned from exports during the fiscal year by those investor who export for the first time, export new products, or export products to new markets;
2. Being given a 50 percent reduction of the business income tax to be paid for the increased income which is earned from exports during the fiscal year by those investor who gain a larger export turnover than that of the previous year;
3. Being given a 20 percent reduction of the business income tax to be paid for the increased income which is earned from exports during the fiscal year by those investor who gain a larger export turnover than that of the previous year;
3. Being given a 20 percent reduction of the business income tax to be paid for the income which is earned from exports during the fiscal year by investor who gain an export turnover of more than 50 percent of their total turnover, or who have a stable export market for three consecutive years;
4. Investor of production units and export products trading establishments who are already given preferences in the business income tax as stated in points, 1,2 and 3 of this Article, will be given another 25 percent reduction of the business income tax to be paid for the income which is earned from exports during the fiscal year, if their projects are developed in regions with difficult economic and social conditions; and will be given an exemption of the business income tax to be paid for the income which is earned from exports during the fiscal year, if their projects are developed in regions with particularly difficult economic and social conditions.
Article 27:
When remitting their income out of Vietnam, investor being Vietnamese residing abroad, foreigners living in Vietnam, or foreigners who contribute capital to or purchase shares of projects, will have to pay a remittance tax of five percent if the remitted income as regulated by this Law.
Article 28:
1. Investor of projects stated in Article 15 and 16 of this Law will be considered and provided by the State assistance fund for the development of science and technology, with medium or long term loans, or be provided by the fund with a part of the interest of the loans which the investors have borrowed from credit organisations.
2. Investors of projects that move production establishments out of urban areas, improve the ecological system and environment, and urban hygiene, will be considered and provided by the assistance fund with medium and long term loans up to 70 percent of their investment capital, at a preferential interest rate.
3. Investors of projects developed in regions with difficult economic and social conditions, will be considered and provided by the State assistance fund, with medium and long term loans up to 50 percent of their investment capital, at a preferential interest rate, or will be considered and guaranteed by this fund for up to 70 percent of their loans, in order to invest in the projects.
4. Investors of projects developed in regions with particularly difficult economic and social conditions will be considered and provided by the State assistance fund, with medium and long term loans up to 70 percent of their investment capital, at a preferential interest rate; or will be considered and guaranteed by this fund for up to 80 percent of their loans in order to invest in the projects.
5. Investors of projects that develop production, or export products trading, in addition to the given credit preferences stated in points 1 and 2 of this Article, will be considered and provided by the Export Assistance Fund, with export credit loans up to 80 percent of their export credit amount as stated in the signed export contracts, at a preferential interest rate; or will be considered and guaranteed by this fund for up to 80 percent of their export credit amount.
Article 29:
Pursuant to the plans and orientations of the country's economic and social development in specific periods of time, the Government will provide lists of professions of all sectors that are subject to the given investment preferences; lists of the regions subject to the given investment preferences; standards of technological levels; the scope if employment that is subject to the given investment preferences; and specific levels of investment preferences stated in Chapter III of this Law.
Chapter IV
Rights and Obligations of Investors
Article 30:
Investors have the following rights:
1. to have an option on sector, profession, and region to invest in within Vietnamese territory;
2. To have an option on the mode of investment; and change of assign their investment projects in conformity with the existing regulations and laws;
3. To register the mode of preferences and scope of preferences to be given in conformity with this Law;
4. To decide the issues on their registered investment, production and business operation activities;
5. To credit an unlimited number of employees; and pay wages on the basis of the agreement between them and the employees in conformity with regulations of the labour laws;
6. To export and import their products directly as per registration except for the items that are prohibited or limited to be exported and imported;
7. To go out of and come into Vietnam in order to develop their investment project;
8. To make complaints, and to denounce or prosecute to the State authoritative bodies any actions that commit violation against the regulations and laws by the State bodies, officials, or employees in conformity with the existing regulations and laws.
Article 31:
Investors have the following obligations:
1. To produce and operate business as per in their registration, implement all the lawful regulations on accounting, and book - keeping; and be responsible to the law for the honesty and precision of the registration of the mode of preferences and scope of preferences to be given;
2. To pay tax and to fulfill all other financial obligations in conformity with the laws;
3. To perform all the lawful regulations on the national defense, and social security, order and safety;
4. To perform all the lawful regulations on the political and socio-political organisation at the enterprise, and to create favourable conditions for those organisations' operational activities;
5. To perform all the lawful labour regulations;
6. To perform all the lawful regulations on the environmental protection, and the preservation of historical and cultural relics and sight-seeing.
Article 32:
In cases where investors are replaced during the period of preferences being given, and the new investors continue the development of the projects, the new investors will have the rights on the preferences, and will be responsible for implementing properly all the obligations in order to be given the preferences of the projects which have been registered for the remaining period of the projects.
Article 33:
In cases where investors are developing the projects that become beyond the given preferences as regulated by this Law, the State authoritative bodies who approve the given preferences will consider and partly amend the preferences, or will abrogate all the given preferences.
Article 34:
Investors being Vietnamese residing abroad, foreigners contributing capital to, or purchasing shares of projects, in conformity with this Law, will have the right to remit out of Vietnam.
1. The income which is earned from their production and business operation activities, and by reinvesting or purchasing shares;
2. The principal and interest of overseas loans during their production and business operation periods;
3. Investment capital;
4. Other amounts and properties of their legal possession.
Chapter V
State Management of Domestic Investment Encouragement
Article 35:
The Government provides the State management of domestic investment encouragement nation-wide. The Government promulgates regulations on the order and procedure to get and authoritative bodies to approve preferences for investment projects in conformity with this Law.
Article 36:
The Ministry of Planning and Investment will carry out the State management of domestic investment encouragement, with the following duties and powers;
1. To chair, and co-ordinate with ministries and concerned sectors to prepare, amend, revise and submit to the Government for approval lists of all the preferences as stated in Article 29 of this Law;
2. To announce, provide guidance, observe and control the implementation of the investment assistance measures and the investment preferences;
3. To grant or refuse to grant a certificate of investment preferences to enterprises established under the decision of the Government; to the enterprises established under the decisions of ministers who are authorised by the Government, within a maximum of thirty days of receiving the applications for preferences to propose to the Government on the measures of investment preferences to be given to enterprises established under decision of the Government; to discuss and agree with the minister authorised by the Government to decide the establishment of enterprises, on the measures of investment preferences. Measures of investment preferences will be stated in the certificate of business operation registration.
Article 37:
People Committees of provinces and cities under the direct central management have the following responsibilities and duties:
1. To perform State management of domestic investment encouragement within the province in conformity with the existing regulations and laws; 2. To grant or refuse to grant a certificate of investment preferences to local available production and business operation establishments, within a maximum of 30 days from the date of receiving the application for investment preferences, to approve investment preferences to be given to the newly formed production and business operation establishments. Measures of investment preferences will be stated in the certificate of business operation registration.
Article 38:
The inspection of activities of production and business operation establishments, is carried out as follows:
1. The inspection of activities of production and business operation establishments will be performed by relevant bodies within their functions and powers, in conformity with the regulations and laws.
The inspection of economic and financial status cannot be performed more than one time a year at an enterprise. The maximum period of inspection cannot exceed 30 days, in specific cases when this period needs extending subject to the decision of the relevant authoritative bodies, the extension cannot exceed 30 days.
The extraordinary inspection, and professional inspection will be conducted only in the cases when there is a proof saying the production and business operation establishment commits violations against the existing regulations and laws;
2. The inspection will be carried out under the decision of the relevant authoritative person; when the inspection ends, there must be minutes to provide final conclusions of the inspection; the head of the inspection team will be responsible for the minutes and the final conclusions of the inspection;
3. Those who decide the inspections beyond conformity with the existing regulations and laws, who take advantage of the inspections to profit, disturb or cause trouble for the activities of the production and business operation establishments will be punished or prosecuted as a criminal liability, depending on the nature and the scope of their violations; if they cause any losses, they must compensate the investors in conformity with the existing regulations and laws.
Chapter VI
Reward and Punishment of Violation
Article 39:
Investors who gain achievements through running production and business operation activities, contributing to the production promotion and improvement of the people's living standards will be rewarded in conformity with the existing regulations and laws.
Article 40:
Investors who commit violations against the regulations of this Law, if they cause any damages, will have to recover the damages, to repay for the given preferences, and depending on the nature and scope of their violations, will be punished for administrative violations, or prosecuted as a criminal liability in conformity with the existing regulations and laws.
Article 41:
Those who take advantage of their position and powers by approving investment preferences beyond conformity with the existing regulations and laws, disturbing, causing trouble for investors, or committing violation against other regulations of this Law, will be punished or prosecuted as a criminal liability, depending on the nature and the scope of their violation; if they case any losses, they must compensate the investors in conformity with the existing regulations and laws.
Chapter VII
Implementation Provisions
Article 42:
1. Investors who enjoy preferences as per in the Law on Domestic Investment Encouragement promulgated on June 22, 1994 will continue to enjoy those preferences for the remaining period of time as stated in the granted certificate of investment preferences;
2. Additional preferences of exemptions and reduction of the land use tax, land rental, business income tax, import tax, investment credit, export credit, guarantee of investment credit and guarantee of export credit stated in this Law, applicable to the investors with a certificate of investment preferences granted before the date of this Law coming into effect, will be amended for the remaining period of time when the given preferences are active;
3. Production and business operation establishments running their activities in the sectors stated in Article 15, or in the regions stated in Article 16, will be given preferences in conformity with this Law from the date of this Law coming into force;
4. The State will not repay the taxes of other financial obligations that are met by investors before the date of this Law coming into force.
Article 43:
This Law will be effective from January 1,1999.
This Law will replace the Law on domestic Investment Encouragement approved by the National Assembly's eleventh Legislature, Section 5 on June 22,1994.
Any previous regulations against this Law Will be abrogated.
Article 44:
The Government will provide detailed regulations in the guidance for the implementation of this Law.
This Law was approved by the National Assembly of the Socialist Republic of Vietnam, Tenth Legislature, Session 3 on May 20, 1998.
National Assembly Chairman
Signed
Nong Duc Manh
(This translation is for reference only)
LAW ON FOREIGN INVESTMENT IN VIET NAM
With a view to expanding economic cooperation with foreign countries, serving the cause of industrialization and modernization, and developing the national economy on the basis of efficiently tapping and utilizing resources of the country; In accordance to the Constitution in 1992 of the Socialist Republic Of Vietnam,
This law sets forth provisions regulating foreign direct investment in Vietnam.
Chapter 1
General Provisions
Article 1:
The State of the Socialist Republic of Vietnam encourages foreign investors to invest in Vietnam on the basis of respect for the independence and sovereignty of Vietnam, observance of the laws of Vietnam, equality, and mutual benefit.
The State of the Socialist Republic of Vietnam protects the owner ships, of invested capital and other legitimate rights of the foreign investors, and extend to the latter favourable conditions and quick formalities to invest in Vietnam.
Article 2:
For the purpose of this law, the following terms shall have the respective meanings ascribed to them hereunder:
1. "Foreign direct investment in Vietnam" refers to the acts of the foreign investors in bringing into Vietnam their capital in terms of money or any types of assets in order to carry out investment activities as stipulated by this law.
2. "Foreign investors" refers to foreign organizations or individuals investing in Vietnam.
3. "Foreign partner" refers to the party consisting of one or more foreign investors.
4. "Vietnamese partner" refers to the party consisting of one or more Vietnamese economic organizations of all economic sectors.
5. "The two partners" refers to the Vietnamese partner and the foreign partner;
"Several partners" refers to the Vietnamese partner and the foreign partner, or the foreign partners and Vietnamese partners, or Vietnamese partners and foreign partners. 1. "Foreign-invested enterprise" refers to the joint venture enterprise or the 100% foreign capital enterprise.
2. "The joint venture enterprise" refers to the enterprise jointly established in Vietnam by the two partners or several partners involved on the basis of a joint venture contract or an agreement signed between the Government of the Socialist Republic of Vietnam and a foreign government, or to the new enterprise established in Vietnam as a result of cooperation between a foreign-invested enterprise and Vietnamese partner or between any such joint venture and a foreign partner on the basis of the joint venture contract.
3. "The 100% foreign capital enterprise" refers to an enterprise in Vietnam whose capital is wholly owned by the foreign investor.
4. "Business cooperation contract" refers to a document signed between two or several partners to carry out investment activities in Vietnam without establishing a status of juridical person.
5. "Join venture contract" refers to a document signed between partners mentioned at Point of this Article to set up a joint venture enterprise in Vietnam.
6. "Build-Operate-Transfer (BOT) contract" refers to a document signed between a Vietnamese competent agency and a foreign investor to build and operate an infrastructure project for a certain period; upon the expire, the foreign investor shall transfer the project to the State of Vietnam without compensation.
7. "Build-Transfer-Operate (BTO) contract" refers to a document signed between a Vietnamese competent agency and a foreign investor to build an infrastructure project, upon the completion of that project, the foreign investor transfers it to the Sate of Vietnam, and the Vietnamese Government reserves the right of operating that project for the foreign investor for a certain period to refund the investment and to earn profit on a reasonable basis.
8. "Build-Transfer (BT) contract" refers to a document signed between a Vietnamese authorized agency and a foreign investor to build an infrastructure project; upon completion, the foreign investor transfers the project to the State of Vietnam, and the Vietnamese Government offers favourable conditions to the foreign investor to carry out another project to refund the investment and to earn profit another project to refund the investment and to earn profit on a reasonable basis.
9. "Export processing zone" refers to an industrial zone specializing in manufacturing exports, carrying out services for the manufacture of exports and for export activities, with defined geographical lines, established by the Government, or under the permission of the Government.
10. "Export processing enterprise" refers to an enterprise specializing in manufacturing exports, carrying out services for the manufacture of exports, and for export activities, established and operating in accordance with regulations of the Government on export processing enterprises.
11. "Industrial zone" refers to a zone reserved for the manufacture of industrial commodities and for carrying out services for industrial production, established by the Government or under the permission of the Government.
12. "Industrial zone enterprise" refers to an enterprise established and operating within the industrial zone.
13. "Investment capital" refers to the capital required for implementing an investment project, and comprises of legal capital and loan capital.
14. "Legal capital" of a foreign-invested enterprise refers to the capital required for establishing the enterprise, and the capital is prescribed in the charter of the enterprise.
15. "Capital contribution" refers to the capital paid in by each partner to constitute the legal capital of the enterprise.
"Re-investment" refers to the use of profit and other legitimate sources of income generated from foreign investment activities in Vietnam to add capital to the on-go-ing project in Vietnam or to another new investment project in accordance with forms of investment stipulated in this law.
Article 3:
Foreign investors are allowed to invest in Vietnam in various areas of the national economy.
The State of Vietnam encourages foreign investors to invest in economic sectors and localities as follows:
1. Sectors:a. Production of exports;
b. Cultivating, growing, and processing agricultural, forestry, and aquatic products;
c. High technology, advanced know-how industries, with a view to protecting the ecological environment, investment in research and development;
d. Labor-intensive industries; processing materials and using efficiently natural resources available in Vietnam;
e. Construction of infrastructure and other important industrial production facilities;
2. Localities:a. Mountainous and remote regions;
b. Areas of underdeveloped socio-economic level
The State of Vietnam shall not grant foreign investment licenses in sectors and areas therein foreign investment may hamper the national security and defense, cultural and historical heritage, custom, and ecological environment.
In accordance with planning and development orientation in each period, the Government shall specify localities where foreign investment is encouraged, issue lists of priority and prime priority investment projects, lists of conditional investment sectors, and lists of prohibited investment sectors.
Vietnamese private economic organizations are allowed to engage in investment cooperation with foreign investors in sectors and under conditions regulated by the Government.
Chapter 2
Forms of Investment
Article 4
Foreign investors are allowed to invest in Vietnam in the following investment forms:
1. Business cooperation on the basis of business cooperation contract;
2. Joint venture enterprise
3. 100 degree celsius foreign capital enterprise
Article 5
The two partners or several partners may enter into a contractual business cooperation venture including the profit-sharing, product-sharing, and other forms of business cooperations
The object, nature, and scope of business as well as rights, obligations, and liabilities of each of the partners and the relationship between them shall be subject to mutual agreement and expressly stated in the business them shall be subject to mutual agreement and expressly stated in the business cooperation contract.
Article 6
The two or several partners may enter into cooperation for he establishment of a joint venture in Vietnam on the basis of a joint venture contract.
Such joint venture enterprise may, again, cooperate with a foreign investor or a Vietnamese business to establish a new joint venture in Vietnam.
Any joint venture thus established shall be under the form of a liability limited company, and shall enjoy the status of juridical person in accordance with the laws of Vietnam.
Article 7
The foreign partner may contribute to the legal capital of a joint venture in the following forms:
Foreign currency; or the Vietnamese currency generated from foreign investment activities in Vietnam;
a. Equipment, machinery, plant, and other building facilities
b. The value of industrial property rights, technical know-how, technical processes, and technical services.
The Vietnamese partner may contribute to the legal capital of a joint venture in the following forms: a. The Vietnamese currency, foreign currency;
b. The value of the land use right accordance to regulations on land;
c. Natural resources, value of rights of using water surface and sea surface in accordance with the laws;
d. Equipment, machinery, plant, and other building facilities;
e. The value of industrial property rights, technical know-how, technological processes, and technical services;
The capital contribution by partners in forms other than those stipulated in Point 1 and 2 of this Article shall have to obtain approval from the Government.
Article 8
There shall be no ceiling on the maximum contribution by the foreign partner or foreign partners to the legal capital of a joint venture in accordance with the agreement of the partners involved, but this contribution shall not be less than 30% of the legal capital, except for other cases determined by the Government.
In the case of a joint venture involving several partners, the minimum capital contribution of each Vietnamese partner shall be determined by the Government.
For those important economic projects determined by the Vietnamese Government, partners involved shall have to reach an agreement on gradually increasing the capital contribution of the Vietnamese partner to the legal capital of the joint venture.
Article 9
The value of the capital contribution of each partner shall be assessed a according to market prices at the time of contribution. The process of capital contribution shall be mutually agrees upon and expressed in the joint venture contract, which is approved by the State foreign investment authority.
Partners shall be responsible for the truthfulness and accuracy of the value of their capital contribution. Where necessary, the State foreign investment authority reserves the right to choose an inspection organization to re-inspect into the real value of capital contributions of partners.
Article 10
The profits and risks of a joint venture shall be shared by the partners in proportion to their respective capital contributions unless this is otherwise agreed upon by partners in the joint venture contract.
Article 11
The leading body of a joint venture shall be its Board of Management, which comprises of representatives of partners involved.
The partners shall appoint their nominees to the Board of Management in proportion to their respective capital contributions to the legal capital of the joint venture.
In case of a joint venture involving two partners, each of them shall have at least two members on the Board of Management.
Where a joint venture involves several partners, each of them shall have at least one member on the Board of Management.
If a joint venture involves a Vietnamese partner and several foreign partners, or vice-versa, a foreign partner and several Vietnamese partners, such a Vietnamese partner or foreign partner, as the case may be, shall have at least two members on the Board of Management
On the Board of Management of a joint venture which is established between a joint venture operating in Vietnam with a foreign investor or with a Vietnamese enterprise, there shall be at least two members of such joint venture will have at least one member.
Article 12
The Chairman of the Board of Management shall be appointed by mutual agreement of the partners. The Chairman of the Board of Management shall be responsible for convening and presiding over meetings of the Board of Management; supervising the implementation of resolutions of the Board of Management.
The General Director and Deputy General Directors shall be appointed, and dismissed, by the Board of Management; and are responsible to the Board of Management and the laws for the management over and directions to operations of the joint venture.
Either the Director General or the First Deputy Director General shall be a Vietnamese citizen.
the responsibilities and rights of the Chairman of the Board of Management, the Director General, and the First Deputy Director General shall be expressed in the charter of the joint venture.
Article 13
Regular meetings of the Board of Management shall be determined by the board itself. The Board of Management may convene irregular meetings at the request of the Chairman of the Board of Management, or of two thirds of members of the Board of Management or the request of the General Director or the First Deputy General Director. All meetings of the Board of Management shall be convened by the Chairman of the Board of Management.
The meeting of the Board of Management shall be attended by at least two thirds of members of the Board of Management representing partners involved.
Article 14
The most important matters concerning the organization and operations of the joint venture, namely the appointment and dismissal of the Director General, the First Deputy Director General, the Chief Accountant; amending and supplementing to the charter of the joint venture; drawing the annual financial balance sheet and accepting the completion of a project; and borrowing investment capital shall be determined upon by the Board of Management of the principle of unanimity among members of the Board of Management present at the meeting.
Partners may agree to express in the charter of the joint venture other issues that shall be determined upon on the principle of unanimity.
Other issues not stated at Point 1 of this Article shall be determined upon by the Board of Management on the principle of obtaining more than half of members of the Board of Management present at the meeting voting approval.
Article 15
Foreign investors may establish in Vietnam enterprises with 100% foreign capital.
The 100% foreign capital enterprise shall be established in the form of the liability limited company, and is granted the status of juridical person according to the laws of Vietnam.
The 100% foreign capital enterprise may cooperate with a Vietnamese enterprise to establish a joint venture.
For those important projects determined by the Government, Vietnamese enterprises in the basic of mutual agreement with the project owner can buy back a certain equity of the enterprise to establish a joint venture.
Article 16
The legal capital of a foreign-invested enterprise shall be no less than 30% of the total invested capital of the enterprise. In special cases, the rate may be less than 30%, but this rate must be approved by the state foreign investment authority.
In the process of operation, the foreign-invested enterprise shall not scale down its legal capital.
Article 17
The duration of a foreign-invested enterprise and that of a business cooperation contract shall be expressed in the investment license of each project in accordance with the regulations of the Government, but not in excess 50 years.
In accordance with stipulations of the Standing Committee of the National Assembly, the Government shall make a decision on a longer duration for each project but not in excess of 70 years.
Article 18
Foreign investors are allowed to invest in industrial zones and export processing zones in the forms stipulated in article 4 of this Law.
Vietnamese enterprises under all economic sectors shall be allowed to cooperate with foreign investors to invest in industrial zones and export processing zones in the forms stipulated in Point 1, Point 2 of Article 4 of this Law or to establish enterprises with 100% of their own capital.
The relations of exchanging goods between enterprises in the market of Vietnam and export processing enterprises are considered import-export relations, and shall be governed by the Law on Import-Export processing enterprises are allowed to buy materials, facilities, and commodities from the local market into the Export Processing Zone in accordance with simple formalities regulated by the Government.
The Government issues regulations on the Industrial Zone and Export Processing Zone.
Article 19
Foreign investors investing in the construction of infrastructure projects may sign the BOT contract, the BTO contract, and the BT contract with the authorized State agency of Vietnam. Foreign investors shall be liable to interests and obligations as stipulated in the respective contract.
The government shall regulate in details the investment in the forms of BOT contract, the BTO contract, and the BT contract.
Chapter 3
Measures of the investment guarantee
Article 20
The State of the Socialist Republic of Vietnam shall guarantee fair and equitable treatment to foreign investors investing in Vietnam.
Article 21
Throughout the duration of investment in Vietnam, invested capital and other assets of the foreign investors shall not be appropriated or requisitioned by means of administrative procedures, and foreign-invested enterprise shall not be nationalized.
The State of the Socialist Republic of Vietnam shall protect the industrial property rights and guarantee other legitimate interests of the foreign investors in their activities of technology transfer in Vietnam.
In the case of changes of the Vietnamese laws resulting in damages to the interests of foreign-invested enterprises and partners involved in the business cooperation contracts which have been licensed, the State shall take appropriate measures to guarantee the interests of the investors.
Article 22
Foreign investors investing in Vietnam shall the right to remit abroad;
1. Profits accruing from business operation;
2. Payments due to them from the provisions of technology or services;
3. The principal and interest due on loans made in the course of business operations;
4. Their invested capital;
5. Other sums and assets in their legal ownership.
Article 23
Foreigners working in Vietnam for a foreign-invested enterprise or for the execution of a business cooperation contract shall, after payment of income taxes as prescribed by the laws of Vietnam, be authorized to remit abroad their legitimate incomes.
Article 24
Any dispute between the partners arising out of a business cooperation contract, a joint venture as well as dispute between foreign-invested enterprises and between partners involved in a business cooperation contract with Vietnamese enterprises shall first be resolved through mutual negotiation and amicable settlement.
If, however, parties to a dispute failed to reach an agreement, the dispute shall be referred to an arbitration organization or the Vietnamese court in accordance with the laws of Vietnam.
For disputes between partners in joint venture enterprise or a business cooperation contract, partners involved may mutually agree in the contract the choice of another arbitration organization to settle disputes.
The settlement of disputes between partners arising from the BOT contract, the BOT contract, and the BT contract shall conform to the mode mutually agreed upon and expressed in the contract.
Chapter 4
Rights and obligations of foreign investors and foreign-invested enterprises
Article 25
The foreign-invested enterprises and partners involved in the business cooperation contracts shall be allowed to recruit employees in accordance with their labour demands and shall take priority in recruiting Vietnamese employees; the recruitment of foreign employees is only permitted where technical and managerial skills are required which the Vietnamese side cannot meet, but a plan to train Vietnamese employees to fill such positions must be taken.
Rights and obligations of employees working in foreign invested enterprises are guaranteed by labour contracts, collective labour agreement, and legal regulations on labour.
Article 26
Employees, Vietnamese employees and foreign employees shall have to observe regulations on labour and other related regulations, and shall have to respect honor, dignity and custom of one another.
Article 27
Foreign-invested enterprises shall have to respect the rights of Vietnamese employees in participating in political organization and socio-political organizations in accordance with the laws of Vietnam.
Article 28
Foreign-invested enterprises and foreign partners involved in business cooperation contracts shall have to insure assets and civil liabilities at insurance companies of Vietnam or at other insurance companies licensed to operate in Vietnam.
Article 29
The transfer of foreign technologies into Vietnam of investment projects shall be executed in the forms of capital, contribution in terms of technologies, or purchase of technologies on the basis of contract in accordance with regulations on technology transfer.
The Vietnamese Government encourages the rapid transfer of technologies, especially advanced technologies.
Article 30
Foreign invested enterprises, partners involved in a business cooperation contract upon the completion of construction works to establish the business shall have to go through the acceptance and hand over procedures for the construction works with certificates of inspection organizations required.
Foreign-invested enterprises, partners involved in a business cooperation contract shall have to go through tender procedures in accordance with regulations of tenders.
Articles 31
Foreign invested enterprises, partners involved in a business cooperation contract shall enjoy self independence in business operations in accordance with objects stated in the investment licenses; be allowed to import machinery, equipment, materials, and transport means, directly export or export by consignment and distribute their products to execute the investment project in accordance with the laws.
Foreign-invested enterprises, partners involved in a business cooperation contract shall take priority in purchasing equipment, machinery, materials, and transport means in Vietnam in the case technical-commercial conditions are the same.
Article 32
Foreign-invested enterprises are allowed to open branches outside the centrally-governed province or city where the enterprises are headquarters to perform business operations in accordance with scopes and objects stated in the investment license, and shall have to obtain approval from the people's committee of the province or city where the branches are to be set up.
Article 33
Foreign-invested enterprises, partners involved in a business cooperation contract shall self-guarantee demands of foreign currency for their operations.
The Vietnamese Government guarantees to balance foreign currency demands for projects on the construction of infrastructure works, production of goods to substitute essential imported goods and other important projects.
Article 34
Partners in a joint venture enterprise shall have the rights to transfer their equities in a joint venture enterprise, but priority shall be given to the other partners in the joint venture enterprise. In the case equities are transferred to a third party, the transfer conditions shall not be more favourable than those which have been set out to the other partners in the joint venture. The transfer shall be mutually agreed upon by partners involved in the joint venture. These regulations are also applicable for the transfer of rights and obligations of partners involved in a business cooperation contract. The 100 degree sensuous foreign investment capital enterprise shall have the rights of transferring its equities, but priority shall be given to the Vietnamese enterprises. The transfer of equities becomes effective only after the State foreign investment authority approves the capital transfer contract. In the case the value of the capital transfer is higher than the initial value, the transferring partner shall be liable to a profit tax rate of 25 degree sensuous on the margin. In the case the equities are transferred to Vietnamese enterprises, the transferring partner shall enjoy tax reduction or exemptions.
Article 35
Foreign-invested enterprises shall open accounts in the Vietnamese currency and foreign currency and foreign currency at the bank of Vietnam, the joint venture bank, or the foreign bank branch based in Vietnam. In the special case, which is approved by the State Bank of Vietnam, foreign-invested enterprises may open the account of loans at the bank in a foreign country.
Article 36
The exchange between the Vietnamese dong and the foreign currency shall be performed according to the official exchange rate announced by the State Bank of Vietnam at the time of exchange.
Article 37
Foreign-invested enterprises and foreign partners involved in a business cooperation contract shall apply the Vietnamese accounting system. In the case another popular accounting system is needed, this must be approved by the Ministry of Finance. The depreciation of fixed assets of foreign-invested enterprises and foreign partners involved in the business cooperation contracts shall be in accordance with regulations of the Government. The annual financial report of foreign-invested enterprises and foreign partners involved in a business cooperation contract shall be audited by an independent auditing company of Vietnam or another independent auditing company licensed to operate in Vietnam in accordance with regulations on auditing. The annual financial report shall be submitted to the financial agency and the State foreign investment authority.
Article 38
Foreign-invested enterprises and foreign partners involved in a business cooperation contract have to pay the profit tax at the rate of 25 degree censious on the profit tax rate is 20 degree cenxious on the profit generated; in the case more conditions and criteria on investment encouraged, the profit tax rate is 15 degree censious on the profit generated. In the special case of investment encouragement, the profit tax rate is 10 degree censious on the profit generated.
For oil and gas and some other rare and precious resources, the profit tax rate shall be in accordance with regulations of the Law on Oil and Gas related regulations.
Article 39
Depending on sectors and localities of investment stipulated in Article 3 of this Law, foreign-invested enterprises and foreign partners involved in a business cooperation contract shall be liable to a maximum profit tax exemption period of two years from that beginning with profitable business, and a 50 degree censious profit tax reduction during two subsequent years.
In the case foreign-invested enterprises and foreign partners involved in a business cooperation contract execute projects that enjoy many conditions and criteria on investment encouragement, they shall be liable to a maximum profit tax exemption period of four years from that beginning with profitable business, and a 50 degree censious profit tax reduction during four subsequent years.
In the special case of investment encouragement, the maximum profit tax holiday shall be 8 years.
Article 40
Throughout the duration of operations, losses incurred by the joint venture enterprise in any tax year may be carried over to the next year, and made up with the profits of the succeeding years but not exceeding five years.
Article 41
After payment of corporate income tax a joint venture enterprise shall use 5 degree censious of its after-tax profits to set up a reserve fund. This fund shall be limited to the legal capital of the joint venture. The percentage of profits, which shall be used to set up welfare fund and other funds, shall be determined by mutual agreements between partners and shall be stated in the charter of the enterprise.
Article 42
In the case the investors re-invest in projects of investment encouragement, they may receive refund of a part or the entire of corporate income tax already paid. The Government shall determine the rate of refund depending on the sector, locality, form, and duration of re-investment.
Article 43
Depending on the rate of capital contribution of the foreign investors to the legal capital of the foreign-invested enterprises or the operating capital of a business cooperation contract, upon the remittance of profits abroad, the foreign investors shall be liable to tax rates of 5 degree censious, 7 degree censious, and 10 degree censious on the profits remitted.
Article 44
Vietnamese nationals residing abroad when investing in the country in accordance with stipulations of this Law shall be entitled to a corporate income tax reduction of 20 degree censious as compared to other projects of the same categories; for the category of corporate income tax of 10 degree censious , Vietnamese nationals shall be offered a tax rate of 5 degree censious on the profits remitted abroad.
Article 45
In accordance with regulations of the Government, the State foreign investment authority shall determine the corporate income tax rate, the exemption and reduction duration for corporate income tax, and tax rate on profits remitted abroad as stipulated in articles 38, 39, 43 and 44 of this Law. The tax rates, duration for tax exemption and reduction shall be stated in the investment license. Throughout the process of executing the investment projects, if there are changes in investment conditions, the exemption a