Leather and footwear sector needs restructuring
Speaking at an international conference on trade promotion for the leather-footwear sector held in HCMC on March 15, Dung said the Ministry of Industry and Trade is drafting a master plan for this industry until 2025 with a vision toward 2035.
Accordingly, Vietnam is expected to turn out two billion pairs of footwear by 2025. It is predicted the country can make more than three billion pairs with outbound sales of around US$45 billion ten years after.
The demand for material will then double or triple. If the nation does not develop supporting industries to produce materials and accessories in the coming time, the local leather and footwear sector will likely be more dependent on imports, and cannot achieve these targets.
The sector needs to promote and encourage enterprises to develop plants specializing in processing hide, artificial leather and other materials. The trade ministry has plans to propose the Government assist them via supporting policies.
Enterprises have no other choice but to improve efficiency, cooperate with others, and heavily invest in modern technology and equipment in order to actively join the global supply chain, making Vietnam become a major leather and footwear producer.
As of 2016, Dung said, the country had around 1,700 leather and footwear enterprises, with 1.2 million direct laborers. Notably, foreign direct investment firms employed 70% of the total and earned 80% of the sector’s total export revenues.
The sector has shipped products to over 50 nations, especially major markets like the U.S., the European Union, China and Japan.
As one of Vietnam’s key export sectors, its export value with US$16.2 billion accounted for 9.2% of the country’s total export turnover.
The sector had posted a growth rate between 10% and 20% per annum in 2011-2015. The figure rose by 8.8% in 2016.
