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Footwear producers formidable abroad, losing at home
Vietnam is now the world’s second largest footwear producer, but owns only 50 percent of its home market.
The Vietnam Leather and Footwear Association (Lefaso) announced at a recent workshop on trade promotion that only China leads Vietnam in footwear production. Despite the global economic crisis, as well as EU anti-dumping lawsuits and the removal of the GSP system for Vietnam, the country’s footwear exports have experienced splendid growth in 2009.
Vietnam exported $2.8 billion worth of footwear in the first eight months of 2009 and it expects to earn a total of $4.6 billion by the end of the year.
Lefaso Chairman Nguyen Duc Thuan says there are 500 footwear producers with 650,000 employees, mostly located in the south, especially in Binh Duong, Dong Nai and HCM City.
Twenty-three percent are joint ventures or foreign invested enterprises, which make up 65 percent of export revenues. Wholly Vietnamese-owned enterprises account for 77 percent of the total number of enterprises, but only 35 percent of total exports.
While Thuan takes pride in sales on the world market, he also reports unsatisfactory domestic figures. Lefaso’s report showed that in the first eight months of 2009 that of some 70 million pairs of footwear sold on the domestic market, only 40 million pairs were made in Vietnam The others were cross-border imports, or imports from neighbouring countries.
Thuan says it seems that Vietnamese enterprises still cannot conquer the domestic market. He observed that in previous years, only 25-30 million pairs of footwear were made for domestic consumption.
In fact, though many Vietnamese brand names have become well known to domestic consumers like Bitis, Bitas, Thuong Dinh, Asia, Vina Giay, T&T and Hong Thanh, the domestic market is presently dominated by Chinese-made imports.
Footwear producers have called on the Government to help them pump up domestic sales.
HCM City Leather and Footwear Association Chairman Vu Van Cham has been working in the industry for 60 years. He thinks that the Government needs to apply reasonable policies to help the footwear industry through brand name development and preferential loans. Vietnam needs to set a goal of holding 60 percent of the market share by 2015.
Lefaso reports that it has submitted plans of footwear producers to develop the domestic market to the Government.
VietNamNet, LD
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