Vietnam Read to Buy cotton from Tanzania
If Tanzania can guarantee enough quality and quantity supply of cotton, then the country has a read market in Vietnam’s Garment 10 Corporation (Garco 10).
The Hanoi based garment market has grown to become one of Vietnam’s foremost apparel companies and its President, Mr Giang Ducvu, offered Tanzania the opportunity to export unspecified quantity of cotton to the giant firm.
Tanzania produces around 360,000 tonnes of cotton a year, but only 10 per cent of the crop is consumed locally.
“We import our cotton from the United States and India but are also read to import even from your country if you can guarantee us the quality and quantity we need,” noted Mr. Giang when briefing President Jakaya Kikwete on the company’s operations recently.
Mr Giang assured Mr. Kikwete who was on a two-day state visit to Vietnam, he could also use his influence as chairman of Vietnam Textile and Garment association (VITAS) to guarantee Tanzania Cotton market to feed Vietnam’s booming textile industry, Recent data shows that Vietnam consumes some 400,000 tonnes of cotton annually – with 35 per cent of that total imported from the United States, 32 per cent from India and 19 per cent from South Africa.
In 2010 - 3,656,756 ring spindles and 104,348 rotors were installed in Vietnam. Total yarn production capacity was 514,000 tonnes per year, primarily for 100-per cent cotton yarn. Domestic consumption accounted for 34.7 per cent of the yarn produced. Woven fabric capacity in 2010 was 680 million square meters.
Garco10, with an annual capacity of 30 million units has 19 factories located in various parts of the Southeast Asian country, with the European Union, the Us and Japan as its major market Pierre Cardin, Burton, Ben Sherman, Zara, Van Hausen, DKNY and Camel are among the major world brands that Garco 10 does business with. Their products cover men’s shirts pants, jackets, tops, bottoms, ladies’ wear and other products.
“Eighty per cent of the products are exported to all over the world including Germany, Japan, United Kingdom, Canada and America. In domestic markets, the company’s own brand manes such as Gate, May 10, Garco 10 etc. are being known as the distinctive apparelskh” he said.
President Kikwete hailed the company’s resilience to survive in a cut-thoat business competition in Asia and expressed Tanzania’s willingness to learn from such experience.
“I’m also impressed to learn that you have maintained the tradition of saluting your national flag before commencing work; this is something we can also reinforce back home” noted the President after Mr Giang revealed in his briefing that over 1,000 workers of the company keep the said tradition alive every Monday morning before work starts. The aim is to motivate and instill a sense of nationalism and pride among workers.
“The sincere of working attitude the co-operation and sophisticated teams of workers and the steady high level of quality enable the company to always serve customers and meet their most serious requests.
“Besides maintaining close relationship with regular customers, the company is willing to set up new business and joint venture with all domestic and overseas partners for the sake of mutual benefit” said the Garco 10 boss. The Minister for Agriculture, Food Security and Co-operatives, Eng. Christopher Chiza, promised to follow up on the offer.
He said the visit to Garco 10 further underlined the need for the country to export processed or semi processed product instead of law materials. “Their textile industry is obviously strong, but overall we have a lot of other issues we need to discuss and learn from our Vietnamese friends” said Eng. Chiza who was part of President Kikwete’s delegation in Hanoi.
He appreciated the major transformation undertaken by Vietnam in the agriculture sector and observed that the government was keen to borrow a leaf from the Asia country’s book in areas like mechanization, irrigation and fishing.
Exchange programmer involving small scale farmers from the two countries is another area Eng. Chiza said the government was looking at. We would like to give our farmer exposure and new experience to improve their knowledge and hence their productivity”, he noted.
The Vice-Executive President of Vietnam Chamber of Commerce and Industry, Mr Hoang Van Dung stressed the need for the two countries to enhance trade and bilateral ties, with records indicating that last year trade turnover between them reached 105 million US dollars.
Of the said amount, Vietnam exported to Tanzania up to 25 million US dollars of commodities such as rice and clinker and imported from the country up to 80 million US dollars of cotton, cashewnuts and cattle feed.
From humble beginnings since the reunification of its northern and southern regions, Vietnam has become a strong player in the global textile market. The textile and apparel industry plays a major role in increasing the country’s prosperity. The Vietnamese textile industry with more than 3,800 companies, is the leading export sector.
State-owned enterprises make up just 0.5 per cent of Vietnam’s businesses; however, 75 per cent are joint stock or limited companies. The country ranks fifth worldwide in textile and apparel export and has a labour force in that sector of more than 2 million people, of who 1.3 million are working directly in the industry.
Analysts are of the view that Tanzania would do well to follow Vietnam’s development path, whose political and economic reforms launched in 1986 have transformed the country from one of the poorest in the world, with per capita income below 100 US dollar, to a lower middle income country within quarter of a century with per capita income of 1,960 US dollars by the end of 2103.
Vietnam has already attained four of its ten original Millennium Development Goal (MDG) targets and is likely to attain three more by 2015. Over the last few decades, Vietnam has made remarkable progress in reducing poverty. The percentage of people living in poverty dropped from almost 60 per cent in the 1990s to under 10 per cent today. Over the same period, the mean income for the bottom 40 per cent of the Vietnamese population increased by an annual average of nine per cent.
Vietnam’s growth rate has averaged 6.4 per cent year for the last decade, but it has begun to slow recently. In 2013, GDP growth was 5.4 per cent and is projected to flatten in2014. Although the economic growth remains moderate and below its potential, Vietnam managed to improve its macro-economic stabilization. Headline inflation fell from a peak of 23 per cent in August 2011 to about 4.2 per cent in August, this year.
Source: Daily News, Tuesday, November 18, 2014