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Situation of the Textile and Garment Industry in Vietnam and Business Challenges in the Export Environment

I. Situation of the Textile and Garment Industry and the Importance of Exports

Vietnam’s textile and garment industry has been playing an important role in the economic structure, especially with the majority of exports. The development of this industry not only creates a large source of income for the country but also contributes to the creation of millions of jobs for workers. However, to maintain and develop this industry, creating favorable conditions for businesses operating in an export environment is extremely important. The number of manufacturing enterprises completing procedures at the Customs Branch of processed goods management – Ho Chi Minh City Customs Department in 2023 decreased by more than 31% compared to 2022, with only about 1,200 enterprises remaining. The number of enterprises in the export manufacturing industry has decreased sharply, partly reflecting the difficult situation in this industry.

II. Challenges from Legal Regulations

Although export is an important part of the textile industry, legal regulations such as Decree 18/2021/ND-CP can cause significant difficulties for businesses in this industry. Regulations on paying export and import taxes right from the time goods are produced or imported on the spot place a heavy burden on businesses. Analysis of the Customs Branch managing processed goods shows that in 2023, import and export activities of enterprises faced many difficulties, with turnover decreasing compared to the previous year. This not only increases costs but also causes inequality between manufacturing and export processing enterprises.

III. Proposed Solutions

The Vietnam Textile and Apparel Association has made a proposal to maintain the regulations at Point C, Clause 1, Article 35 of Decree No. 08/2015/ND-CP and exempt imported goods for export production. This is to reduce the burden on businesses and enable them to focus on core business activities.

However, before changing regulations, it is necessary to carefully consider the legal and financial consequences to ensure that this adjustment will not cause unwanted consequences and still ensure fairness. and transparency in business operations. This may include consulting with legal and economic experts to ensure the feasibility and effectiveness of proposed measures.

IV. Additional Considerations and Suggestions

Discussing and providing solutions in dialogue conferences between businesses and government agencies is very important to find appropriate support measures and improve the business environment for the textile and garment industry in Viet Nam. Additionally, mechanisms need to be established to evaluate and monitor the effectiveness of implemented measures to ensure that they achieve the desired goals and do not cause unwanted side effects.

V. Important Information on Legal Procedures and Regulations

1. Conformity Certification Process: Ensure that the process is carried out in a transparent and fair manner, and provide support and guidance to businesses on the requirements and standards to comply with.
2. Customs Procedures: It is necessary to enhance application and support process for businesses on customs procedures to minimize time and costs for importing and exporting goods.
3. Tax Incentives in Free Trade Agreements: It is necessary to strengthen information and guidance so that businesses can easily access and take advantage of tax incentives in free trade agreements.
4. Quality Control: It is necessary to strengthen the ability to control and monitor the quality of textile products from production to export to ensure compliance with standards and regulations.

VI. Important factors in garment export procedures

During the garment export process, there are a number of important factors that need to be paid attention to and implemented properly to ensure success and legal compliance. Below are important factors in garment export procedures:

1. Legal regulations and rights: This is the most basic factor when exporting, including export regulations, taxes and fees, customs procedures and international commitments, and ownership rights intelligence, contracts and payments. Understanding and complying with these regulations is important to avoid legal problems and optimize your business’s rights.
2. Quality management and ensuring compliance with standards: Ensuring that exported goods meet the required quality standards is important. This includes inspection and quality control of goods, ensuring compliance with regulations on materials, composition, sizes and performance.
3. Carry out customs inspection and control: Complete and accurate declaration is important to ensure that exports take place according to regulations and avoid customs-related problems. At the same time, customs control also helps ensure transparency and avoid legal risks.
4. Risk management and insurance: For garment exports, risk management is extremely important. Businesses need to assess and insure against possible risks such as loss, damage or problems during transportation to ensure export activities take place smoothly and safely.
5. Issuing certificates of origin for textiles and garments: Making C/O certificates of origin for garments helps importers reduce import taxes and is one of the important procedures. To complete an import/export application, documents need to be provided fully and accurately such as declaration form, certificate of origin, production process, purchase invoice, commercial invoice, export customs declaration, and shipping orders. Ensure that all information and documents are provided properly to avoid legal and customs issues.

VII. Conclusion and Outlook

Overall, to overcome current challenges, there needs to be close cooperation between the government and businesses to find appropriate solutions and improve the business environment for the textile industry in Vietnam. Understanding and complying with legal processes and regulations is important for businesses in the textile and garment industry to operate effectively and sustainably in the international market.