Therefore, textile products manufactured in Vietnam could enjoy many benefits. Many foreign investors have come to Vietnam to seek investment opportunities in textiles.
This is a 75 million dollar joint venture between the Chinese-owned Youngor Group and a Vietnamese business. When completed, the factory will have the largest capacity in the north of Vietnam. Foreign investors hold the advantage when it comes to investment capital and modern technology.
Tran Van Tuan, Deputy Director, Thien Nam Sunrise Textile Joint Stock Company said: 'They have a large amount of capital and they have better technologies than us".
Besides the dyeing factory, the Youngor Group has also invested in a cotton mill in order to provide material for its textile factories. Six years ago, Youngor constructed 2 textile factories in Hưng Yên and Nam Định provinces. Instead of importing materials from China, these two factories will provide 80% of materials for their textile factories. As China was invited to participate in the TPP, the firm can nevertheless enjoy the benefits of the agreement through shifting its supply chains from China to Vietnam.
"They can see the potential of the TPP despite foreign investors not necessarily coming from TPP signatory members. They are taking advantage of the strengths of the local textile and garment industry. They are choosing the right strategy. At this time, FDI businesses in textile industry in Vietnam have many advantages", Tran Van Tuan, Deputy Director, Thien Nam Sunrise Textile Joint Stock Company added.
This is one of many textile corporations from China, Korean and Japan that has invested in Vietnam. 4 billion USD has been invested by foreign firms into the textile industry over the past 2 years, a figure that has exceeded total investment in the textile industry over the past 10 years. In the first 9 months of 2015, FDI in textile sector reached 1.2 billion USD, accounting for 20% of total investment in Vietnam.
China used to be the ideal location for global supply chains during the past decade. However, investors are looking for a location with new opportunities. And Vietnam is considered as a potential destination for international supply chains.
Vietnam’s textile industry currently imports 8 billion USD of materials every year. This number is likely to increase after the TPP takes effect. The TPP could bring many benefits to the garment and textile sector as foreign investors are turning to Vietnam to seek investment opportunities.
