Japan is the third largest export market for Vietnamese textiles and garments, the largest two importers being the US and the EU. Of the countries exporting textiles and garments to Japan, Vietnam comes in third following China and the EU
Although for several years Japan has been importing more Vietnamese textiles and garments every year, the Ministry of Industry and Trade said that it’s getting harder to compete.
The General Department of Customs says that Japan imported US$531 million worth of Vietnamese textile-garments in 2004, US$604 million worth in 2005 and US$628 million worth in 2006. In the first 10 months of 2007, textile-garment exports to Japan were at US$587 million, 12 percent higher than in the first ten months of 2006. In October 2007, textile-garment exports earned US$64.8 million, four percent more than in September and nine percent more than in October 2006.
In the first 10 months of 2007 Vietnam exported 12 million pairs of trousers worth US$107 million, an increase of 18.9 percent in volume and 15.5 percent in value compared with the same months of 2006, and 18 percent of the revenue earned from textile-garment exports to Japan came from trouser exports. Jacket, overcoat, suit, pullover and especially jean exports to Japan increased sharply. In the first 10 months of 2007, 346,000 kimonos worth US$77.8 million were exported to Japan, a rise of nine percent in volume compared with the first 10 months of 2006, while earnings remained the same.
In October 2007 the average price obtained for trousers exported to Japan was US$9.25 per pair FOB (free on board), a three percent increase over September and eight percent more than in October 2006. Vietnamese-made kimonos shipped to Japan slipped in the first quarter of 2007, increased slightly in the second and the third quarters, and the export price reached US$236 FOB in October 2007, two percent higher than September and seven percent higher than August.
The Vietnam Textile and Apparel Association said that Japan is a major textile-garment importer with Chinese textiles and garments holding a 73.6 percent share of this market. The next largest exporter to Japan was the EU with 8.1 percent, then ASEAN (Association of South East Asian Nations) with 7.5 percent, the US with 2.5 percent and then Chinese Taipei with 1.3 percent. Vietnam does export more textiles and garments to Japan than any other ASEAN country.
Japan insists upon quality imports and the country of origin must always be specified. Economic Partnership Agreement (EPA) negotiations between Vietnam and Japan are underway and a final agreement is expected to boost trade between the two countries. Domestic textile-garment companies are paying close attention to the details which are now being negotiated.
The Ministry of Industry and Trade says that the EPAs that Japan has signed with six other ASEAN countries (Singapore, Malaysia, the Philippines, Indonesia, Brunei and Thailand) allow textile-garments made in these countries to enter Japan tax-free. At this time Vietnamese textile-garments entering Japan are taxed at 10 percent, making it harder to compete with products from other countries in the region. The Vietnam-Japan EPA that is being negotiated will likely allow Vietnamese textile-garments to enter Japan tax free if Vietnamese textiles and garments are made from materials that are from Vietnam, Japan or any ASEAN country. In fact, more than 80 percent of the components of Vietnamese textile-garments are imported from other countries and this means that Japan will tax Vietnamese textile-garment imports.
If the fabric and other components used in making Vietnamese garments is imported from ASEAN countries or Japan, textile-garment exports to Japan will be tax free and better able to compete with products from other ASEAN countries and China (Japan also taxes Chinese textile-garment imports). Increased exports to Japan would be welcomed by domestic textile-garment producers./.
05 June, 2010 by admin