The COVID-19 pandemic will continue creating trouble for the leather-footwear sector in Europe and the US – its key markets for export, in 2021, the Sai Gon Giai phong newspaper reported, citing experts’ opinions.
In 2020, the sector shipped overseas 19.5 billion USD worth of products, an annual decrease of 11.5 percent.
As the pandemic has basically been placed under control in Vietnam, long-term orders have returned. However, experts said the difficult situation will prolong throughout 2021.
To counter COVID-19 negative impact, Phan Thi Thanh Xuan, a consultant for USAID’s Linkages for Small and Medium Enterprises Programme, said the only solution for leather-footwear enterprises is to overhaul their production by investing in automation, productivity promotion, and building closed production chains.
There is a rising trend of customers preferring long-lasting products over “fast fashion” goods, she noted.
Insiders said leather-footwear production is mostly limited to Cut, Make, Trim activities, and exports were mostly done via intermediaries rather than directly with importing brands. Companies involved often lack human resources for information updates on markets and customers. Most of them produce goods following orders. Their reliance on imported materials also hinders them from meeting origin rules set by new-generation free trade agreements.
Cao Quoc Hung, Deputy Minister of Industry and Trade, affirmed a series of measures are deploying to sustainably develop the sector via building domestic material supply sources, forming domestic leather-footwear value chains, and fostering a workforce that can meet firms’ requirement for management, design, technique, market development, and R&D.
Ensuring environmental protection and labour safety are also key to helping the sector clear technical barriers and integrate deeper in the global market, he noted.