Bags / Shoes & Accessories

Vietnam Leather Footwear and Handbags Association (Lefaso) Vice President and Secretary-General Pan Thi Thanh said that in the first seven months of this year, Vietnam’s leather and footwear industry’s international trade exports increased by 13%, earning more than 14 billion U.S. dollars in foreign exchange. This growth rate is quite balanced in major markets, such as 24% in the North American market and 17.5% in the European Union.

Vietnam's international trade in footwear that has joined the FTA market continues to show a positive recovery. Among them, exports to the EU-Vietnam Free Trade Agreement member markets increased by 18.2% year-on-year, and the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) member markets increased by 10.5%. Through the Vietnam-UK Free Trade Agreement The UK market's international trade exports increased by 10.9%.

In assessing the prospects of the leather and footwear market in the second half of the year, Pan's youth said that in addition to opportunities, there will be many challenges. The impact of the international trade situation, especially the major international trade export markets of Vietnam's leather and footwear such as the EU and the United States, are experiencing the impact of consumption crunch, which will definitely affect purchasing power.

In terms of export markets, Vietnamese products are at an intermediate level in terms of quality and price. To compete, the industry needs to produce higher-value products. For this, high-value raw materials must be imported from other countries.

Under the pressure of the rules of origin of the free trade agreement, the localization rate of Vietnam in the leather and footwear industry has increased significantly, which has now reached 55%, especially sports shoes, which has reached 70-80%. The industry has also set a goal of gradually increasing the overall localization rate of the entire industry to 70-80% in the future. However, Pan’s youth also acknowledged that the industry still faces difficulties in the investment and production of raw materials, such as the need to import billions of dollars of leather products every year because the products are subject to strict environmental regulations. This is also a restrictive factor for Vietnam's leather and footwear industry to increase the localization rate in recent times.