Essay About Vietnamese Textile Products And Foreign Investment

Organisation Behavior
Organisation Behavior
1. In Vietnam, textiles and garments are considered part of a
single industry. It is an important industry, because: (1) it is
labor-intensive, employing workers who do not require extensive
training, and (2) it has contributed considerably to the export
revenue of Vietnam in recent years. In this industry, the
Vietnam Textile and Garment Corporation (VINATEX) is the biggest
producer and exporter of textile and garment products. It is
also the largest importer of materials for domestic production.
2. Transition has been difficult for the textile industry.
Traditional markets such as the USSR and Eastern European
countries have collapsed. New markets in newly industrialized
countries, the EU and Japan, require high quality products, and
often raise entry barriers to Vietnamese textile products.
3. Vietnamese firms import a huge amount of textile products. In
1997, 23 countries exported textile products to Vietnam. The
biggest players are Taiwan, South Korea, and Japan, with the US
ranked 14th. Textile imports have swamped the domestic
producers, creating problems for them.
4. Textile products made by Vietnamese companies occupy a small
part of the total Vietnamese demand. Production technology used
by Vietnamese companies is out of date. Their products are of
low quality. In recent years, some companies have invested lots
of money to renew machinery and to upgrade infrastructure. An
example is Thanh Cong Textile company (T.CITEX), with its aims
for expanded capacity and higher quality products.
Unfortunately, due to financial difficulties, few companies can
afford to upgrade like Thanh Cong.
5. Since the end of the 1980s, when the Vietnamese Government
began open door policies to attract foreign investment, many
foreign companies have invested in the garment and textile
industry. By June 30, 1996, foreign companies from 13 countries
had invested in the textile industry. 20 joint-venture