BP Textile Vietnam, a subsidiary of Chinese textile firm Black Peony, has kicked off construction of a US$71.1 million factory in the northern coastal province of Quang Ninh, according to The Investor. This is inline with a return to growth for Vietnam’s garment and textiles sector after a challenging few years.
Notably, Vietnam’s textile and garment industry experienced strong growth in the first six months of 2024. In the first half of 2024, Vietnam’s textile and garment exports reached approximately US$16.5 billion, an increase of 4.6 percent over the same period in 2023.
However, the improvement in Vietnam’s textile and garment exports does not seem to necessarily stem from improved global demand but from a shift of orders from other countries to Vietnam.
This is being driven by the depreciation of the Vietnamese Dong by about five percent since the start of the year, while the currencies of competing countries remain almost unchanged, Hieu Huu Cao, General Director of Vietnam Textile and Garment Group, told VnEconomy back in June.
Moreover, despite rising order volumes, prices remain stagnant, while logistics costs, particularly shipping, have seen a continuous increase. Of note, ocean freight rates have increased about 30 percent in recent weeks and are expected to climb further. This is putting additional financial pressure on local garment and textile producers.
Black Peony was founded in 1940 in China. This firm focuses on denim fabric, yarn-dyed fabrics and garment manufacturing. It has worked with a number of big name brands including Calvin Klein, Levi’s and GAP.
See also: Vietnam Garment Manufacturing 2024: Ultimate Guide