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Gov’t looks to develop cotton industry
The $215 million plan is designed to address the major shortage of cotton for the textile and garment industry.
Viet Nam has a new plan to develop cotton-growing areas, as well as to develop new textile and dyeing industrial zones.
The plan, developed by the Ministry of Industry and Trade and Viet Nam National Textile and Garment Group (Vinatex), will require VND3.6 trillion (US$215 million) to provide solutions for Viet Nam’s severe shortage of cotton which is affecting the textile and garment industry.
Land allocated to cotton cultivation has been sharply reduced in recent years.
The 2003-04 cotton crop was the country’s largest, with 31,187ha allocated to growing the crop. By 2007-08 the cotton farm area was reduced to less than 7,000ha, and output was only 2,600 tonnes of fibre. This met only 2 per cent of the domestic textile and garment industry’s needs.
Economists predict that with current conditions cotton will no longer be grown in the country by 2010.
Farmers have stopped growing cotton, because more money can be gained from other crops such as maize, potato, cassava, beans, chilli and tobacco.
The central highlands province of Dak Lak in 2002, for example, had 16,000ha of cotton which was gradually reduced to less than 100ha this year.
Local farmers calculated that they could earn a profit of VND3 million ($179) from each hectare of cotton. If they grow maize, however, they could earn a profit of VND10 million ($598) per hectare.
In many localities, farmers cut down cotton and started growing rice, corn and cassava. Only a few provinces still plant cotton including Dak Lak, Dak Nong, Binh Thuan and Dong Nai.
Cotton companies raised their buying prices from VND7,000 per kilo to VND9,000 per kilo this year, as they realised without economic incentives cotton growing will be eradicated. However, it is feared this will not be enough.
The Government had originally estimated that from 2001 to 2010, the country would grow about 150,000ha of cotton to produce a 80,000 tonne harvest, which would meet the demand for 50 per cent of textile and garment industry. This clearly did not come to pass. In the meantime, the textile and garment sector has grown and needs 200,000 tonnes of cotton fibre per year.
According to the Ministry of Industry and Trade, the country now has to import nearly 100 per cent of cotton to fit its needs.
Solutions
Deputy Prime Minister Hoang Trung Hai says, the textile and garment sector will continue playing a crucial role in industrial development until 2025.
"The sector now faces many severe challenges, mostly because of a lack of investment in textile and dyeing industries, as well as cloth production, so it hardly has enough materials for production. The sector depends too much on imported materials, so its added value was low. Low labour productivity also weakens competitiveness of the sector’s products," says Hai.
In the new plan to develop the textile and garment industry by 2015, the Government has set a target to produce 1 billion sq.m of cloth to serve exports.
40,000ha of land will be designated in 13 localities in the central highlands and southern area of Central Viet Nam to grow cotton by 2020.
The programme needs large investments to compensate for site clearance, irrigation systems, vehicles and saplings.
Deputy Minister of Industry and Trade Bui Xuan Khu said the textile and garment sector would ask the Government to set up eight industrial zones for dyeing and textiles in Hung Yen, Nam Dinh, Thai Binh, Ninh Binh, Da Nang, Long An, Nha Trang and Binh Thuan from 2008 to 2012. In the next stage, from 2012 to 2015, other industrial zones will be built in Nghe An, Quang Tri, Tien Giang and Tra Vinh provinces.
VNN
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