In 4 months, exports increased by 5.7%

In April 2024, leather and footwear will continue to be in the group of industries with large export turnover with 1.956 billion USD. Accumulated in the first 4 months of the year, total footwear export turnover reached 6.542 billion USD, up 5.7% over the same period in 2023.

In Vietnam's traditional export markets, shoes and bags account for a large market share. According to data from the Vietnam Leather, Footwear and Handbag Association, in the first quarter of 2024, Vietnam's footwear products accounted for 41.7%, briefcases and bags accounted for 45.4% of the market share in the US; Next is the EU market with 28.6% and 27.1%; China is 11% and 3%; Japan is 6.3% and 11.3%...

Ms. Phan Thi Thanh Xuan - General Secretary of the Vietnam Leather, Footwear and Handbag Association said that among the import markets for Vietnam's leather and footwear products , China is a potential market with a high growth rate. high rank. " This is also an important market to help the leather and footwear industry achieve its export goal this year ," Ms. Xuan said.

In addition, the leather and footwear industry has made good use of incentives from free trade agreements, especially in markets with EVFTA and CPTPP agreements.

The increase in leather and footwear export turnover partly reflects the improved order picture of businesses in this field compared to the same period last time.

Leather and footwear exports: Increased orders have not overwhelmed worries about new regulations. Photo: Can Dung

Gia Dinh Group Joint Stock Company is a typical example, orders received by the business increased by more than 30%, ensuring workers will work until September-October 2024. To obtain this number of orders, in addition to traditional customers such as the US and EU, Gia Dinh Group has expanded customers in Japan, Korea and exploited niche markets such as South Africa, Mexico,...

Similarly, TKG Taekwang Vina Joint Stock Company in Bien Hoa 2 Industrial Park, due to increased orders again, the business is in need of recruiting 1,000 workers to meet.

Pressure from new regulations

However, according to Ms. Xuan, the leather and footwear industry is facing many big challenges. In the EU market, a series of regulations on ecological products, extended producer responsibility, supply chain traceability, carbon emission reduction requirements for manufactured products... have and will be implemented in the near future and require countries exporting to the EU market to comply. This is a big challenge for manufacturers, including Vietnam. “ If we want to successfully participate in the supply chain, there is no other way we must comply ,” Ms. Xuan emphasized.

According to Mr. Gerwin Leppink, an expert at the Wrap Organization, today to successfully export to the US and EU, compliance with Customs and Border Protection regulations as well as human rights due diligence laws is essential. mandatory. Global customs and social responsibility compliance certification in responsible production is the most practical and reliable tool to simultaneously meet the laws of the United States, Germany, and Europe.

To comply with the above requirements, according to Ms. Xuan, businesses must upgrade technology and management. Furthermore, it is necessary to promptly grasp information and then have specific plans to prepare resources to implement these new requirements, such as green energy and digital transformation to reduce costs.

Besides, enhancing and improving the production and business model is also an urgent issue. Because today's footwear is no longer the production model of 10 or 20 years ago, it is necessary to change in training, improving skills, qualifications, knowledge, and skills for workers.

Businesses also need to change their management methods. They cannot manage in the traditional, command, and manual style, but need to apply digital transformation in the management system so that the data flow in the factory needs to be continuous. helps leaders update information and make timely decisions, only then can they grasp and meet customer requirements.

Businesses need to build a compliance department to update information and meet customer requirements... The footwear industry is considered to be a field that causes a lot of carbon emissions during the production process. The EU is setting regulations on the Carbon Border Adjustment Mechanism (CBAM), while this industry exports to the EU market quite large (only after China) about 6 billion Euro/year, so the EU will certainly apply the mechanism. CBAM processing with Vietnamese leather and footwear products.

“ However, the application has not been implemented immediately, but there is a high possibility that by 2030 CBAM will be applied to the leather and footwear industry, so the next 5-7 years is the time for Vietnamese leather and footwear businesses to plan and prepare specifically. possible, clear. It's not simply that we change one part of the production process, but we have to change almost the entire depth, from technology, management to operations and response ," Ms. Xuan emphasized.