Photo: vietstock.vn

Investors from the Republic of Korea (RoK) are showing greater interest in Vietnam’s textile and garment sector, the Vietnam Investment Review reported on June 19.

In early June, a big fibre manufacturing plant was launched in the southern province of Dong Nai, marking a growing presence of RoK investment in Vietnam’s textile and garment sector.

The 52 million USD project, belonging to Dong-IL Vietnam Limited under the Dong-IL group, is located in Dong Nai’s Loc An-Binh Son Industrial Park and is Dong-IL’s first project in the country.

The plant has an estimated capacity of 9,000 tonnes per year and will come on-line mid next year to supply the domestic market, as well as other Asian markets.

Dong-IL Vietnam’s managing director Suh Min Sok said he expects the project to help attract other RoK investors to the Vietnamese market.

Unlike Dong-IL, Sea-A group has been operating in Vietnam for nearly six years and has a garment plant based in the north-central province of Thanh Hoa. It is run by Winners Vina Limited, a unit under Sea-A.

The 12 million USD facility turns out seven million products a year and has a workforce of 3,000.

Winners Vina is already envisaging a second garment plant in Vietnam, in which it will invest 15 million USD and employ 6,000. Its products will primarily be for export.

“The move is to satisfy growing orders from US importers, mostly leading retailers such as Target, Walmart, Kohls, Kmart, Sears and Tesco,” said a company source.

With more than 500 businesses based in Vietnam and nearly 2 billion USD in total committed capital, RoK investment has helped bolster Vietnam’s textile and garment industry, and in particular helped increase export value to RoK, which is now Vietnam’s fourth largest export partner in terms of value, after the US, the EU and Japan.

Vietnam’s textile and garment exports to RoK have jumped sharply in recent years, from less than 300 million USD in 2009 to nearly 1.2 billion USD in 2013 and an estimated 750 million USD in the first five months of this year.

This has given Vietnam’s textile and garments a 24.2 percent market share in RoK, only behind China with 43.2 percent.

The fifth negotiation round for the Vietnam-RoK free trade agreement (FTA) was wrapped up in late May and both sides have reportedly ramped up efforts to conclude the talks by October this year.

The Vietnam Textile and Apparel Association forecasted RoK investment in Vietnam could make a major leap following ratification of the FTA.

Source: VNA