Late last year, the textile and garment industry expected to raise its textile and garment production by 20% in order to boost the sector's export value by US$4 billion to US$28.3 billion this year.
The Vice Chairman of the Vietnam Textile and Garment Association Pham Xuan Hong said exports to the industry were often optimistic during the first and last months of the year. However, exports in the first quarter of this year were slow.
Many domestic exporters also said their export contracts, especially for small and medium-sized firms, had declined sharply in Q1 this year. Some even reported a drop of up to 20%.
Phi Ngoc Trinh, deputy general director of the Ho Guom Garment Joint Stock Co, said the drop was the steepest seen in the past 15 years.
Hong attributed the decline to the devaluation of the Euro against the dollar.
He said more than 20% of Vietnamese textile and garment producers had currently shipped their products to European markets. The devaluation of the Euro against the greenback had led to Vietnamese exports becoming costlier and less competitive.
Similarly, Vietnamese exports to Japanese and Russian markets were also negatively impacted due to the volatility of the countries' currencies, Hong said.
Besides, domestic exports had faced other difficulties related to input costs and raw material sources.
Admitting these difficulties, the General Secretary of the HCM City Association of Garment Textile Embroidery and Knitting, Bui Trong Nguyen, said he expected the situation to improve during the next quarter when European customers signed more export contracts.
Besides exports, Vu Quang Tung from the Song Hong Garment Co., said his company had also stepped up sales in the domestic market to offset the loss.