Bright future for Vietnam, Africa raw cotton trade

Do Huu Huy, deputy head of the Ministry of Industry and Trade's Africa and South West Asia Market Department, also divulged most of the raw materials for the sector originate in Africa and are sold to Vietnamese manufacturers through intermediary French, Swiss and Indian wholesalers.

The garment and textile sector would benefit tremendously by developing a direct international supply chain with African nations, Huy says, thus eliminating the extra cost of the middleman, resulting in increased price competitiveness in the global marketplace.

A spokesperson for the Ministry of Industry and Trade and Vietnam Cotton & Spinning Association, echoing Huy’s views, disclosed the agency has been endeavouring to strengthen trade promotion activities with African countries over the past with a view towards ameliorating the situation and enhancing the sector’s supply chain.

The spokesperson cites a recent meeting held at the International Trade Centre (ITC) for Vietnamese manufacturers and its partners from eastern and southern African countries as a specific example.  Numerous prospects for increased direct trade between the two sides were opened up at the meeting that will benefit the industry in the coming time.

Vietnam currently imports raw cotton from 19 out of 55 African markets, mainly Tanzania, Mozambique, Zimbabwe, Zambia, Uganda, and Malawi. African cotton is of fairly good quality, reasonably priced and suitable for yarn production.

Marco Charles Mtunga, acting Managing Director of Tanzanian Cotton Board in turn said that the association is working with ITC to implement better management measures related to cotton contamination. Along this line, the association will be offering training courses for farmers and cotton processing factories aiming to improve the quality of cotton in the future.

According to General Department of Customs, in the first seven months of this year, cotton imports surged 34% in volume and 36.3% in value on-year to a record 458,000 tonnes valued at US$919 million.

According to the Vietnam Cotton and Spinning Association (VCOSA), the industry currently has 5.1 million spindles with production capacity of about 700,000 tonnes of fibres per year.

VCOSA General Secretary Nguyen Hong Giang said that the Trans-Pacific Partnership Agreement (TPP)’s origin requirement for “yarn forward” would create favourable conditions for exponential growth in the global marketplace for Vietnamese manufacturers.

With the expansive prospects created by the TTP and the momentum for the development of a direct supply chain for raw materials with African partners, the prospects for continued rapid and sustainable growth in the garment and textile sector remain bright.