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Hard labour for labour-intensive workers
Next year will be a tough time for labour intensive industries like textile-garment and footwear.
Lien Phat Footwear Company Limited director Truong Thi Thuy Lieu said a depreciating euro and public debt rising to alarming levels in many EU countries have made exports to Europe increasingly difficult.
“Big footwear firms will see 10-15 per cent declines in export contracts, while the shortfall could be a more critical 30 per cent at smaller ones in 2012,” said Lien.
Dwindling consumption in big markets means competition could mount up among foreign exporters, particularly the pricing competition, according to a footwear-maker Dinh Vang Company Limited representative.
With 12,000 people on the payroll, sliding export orders would fuel pressures associated with labourers’ wage payments, said the representative.
Garment export orders to EU and US markets are also forecast to fall 15-20 per cent against 2010-2011.
In fact, the current time is also proving severe for scores of firms in labour intensive sectors.
In the third quarter of 2011, several hundred labourers at Ho Chi Minh City-based wholly Thai owned garment maker Baxter Brenton Company lost their jobs. Besides, they neither got allowances nor were supported by the employer in completing procedures to enjoy unemployment benefits.
Over 200 workers at South Korean invested bag-maker Miso Vina Company became jobless from the third quarter of 2011 since the firm was dismantled.
In the past months, a number of textile-garment and footwear firms based in Ho Chi Minh City reportedly shut down doors on the back of ineffective business and escalating production costs, leaving hundreds of workers empty-handed.
Parallel to soaring production costs and declining consumption in export markets, Vietnam Textile Apparel Association chairman Vu Duc Giang said capital paucity would still afflict footwear as well as textile-garment firms in the next year, hampering their efforts for business development and expansion.
The textile-garment and footwear industries witnessed high export value in 2011. Particularly, in the year to November, the textile garment sector raked in more than $13 billion from exports, surging 31 per cent on-year while the footwear sector’s full-year export value is forecast to surpass $6 billion, a 30 per cent jump on-year.
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