Vietnam Is Committed To Getting Rid Of Dependence On Import Of Leather Raw Materials

The Vietnam Leather and Footwear Federation said that the export volume of Vietnamese leather shoes and handbags this year will reach 12 billion dollars, which will achieve the previously expected export target.

Last year, the export of leather shoes and handbags reached 10.4 billion US dollars, becoming Vietnam? The third largest export industry. "In the first quarter of this year, the export of leather shoes increased by 14%, and the export of handbags also increased by 18%," said Diepthanhkiet, vice president of the Leather and Footwear Federation.

However, factors such as scattered production, underdeveloped supporting industries and lack of skilled workers have inhibited the sustainable development of Vietnam's leather industry. Last year, Vietnam's imports of leather and other raw materials reached 4.2 billion US dollars, equivalent to the entire Leather export 40% of the amount.

Currently, manufacturing leather shoes 70% of leather and handbags need to be imported, and the main import sources are South Korea, Taiwan, Italy and Thailand. When asked whether the current problems in Vietnam and China will affect leather imports, diepthanhkiet said that the impact is not great, because only 6% - 7% of leather is imported from mainland China.

The situation in the textile industry is similar. At present, only 40% of the cloth and other raw materials can be purchased locally in Vietnam. Vietnam needs to import cloth and other raw materials from abroad at an annual cost of US $3 billion. The main source of import is China.

However, there is a tendency to shift from China to Vietnam in fabric production. At present, Vietnam is negotiating with other countries and organizations on matters related to free trade agreements. The signing of free trade agreements will enable manufacturers who move to Vietnam to enjoy more benefits.

In the next five years, the raw materials produced in Vietnam will meet 50% of the demand, and the rest will be imported from Taiwan, Vietnam and Indonesia.

An industry insider said that Vietnam's leather and handbag industries will have huge potential because Vietnam's wages are lower than China's, Vietnamese products are in high demand at home and abroad, and Vietnam will join the Trans Pacific Cooperation Agreement.

Phanchidung, head of the light industry department of the Ministry of Industry and Trade of Vietnam, said that according to the government's plan, the proportion of "Made in Vietnam" in the leather products industry should be increased to 60% - 65% around 2015, and 75% - 80% by 2020.

However, he acknowledged that it was difficult to achieve this goal, but it was Vietnam and the EU that had identified the Free Trade Agreement and were about to join the Trans Pacific Trade Cooperation Organization, which would greatly increase the proportion of "Made in Vietnam" in the leather industry.