Taiwan's textile makers speeding up expansions in Vietnam

Taipei, Feb. 24, 2005 (CENS)--Taiwan's textile manufacturers in Vietnam are expanding their production capacity there to meet the increasing orders as Vietnam will widely open its market after its entry into the World Trade Organization (WTO) expected this year.

Leading garment makers such as Makalot Industrial Co. and Roo Hsing Garment Co. have recently enlarged their operations in Vietnam, allowing upstream yarn and cloth producers, including Nan Ya Plastics Corp., Chung Shing Textile Co., and Lien Ming Textile Co., to enjoy full orders from them.

Wang Hsiao-lung, Roo Hsing's general manager, noted that Vietnam is very likely to join WTO this year and will therefore follow WTO's rules to further open its market. In view of the great sales potential in the Vietnam's garment market, Roo Hsing is aggressively reinforcing its footholds there by installing two additional production lines, which are slated to join production in March to meet increasing orders. With the expansion, the company's monthly output in Vietnam is estimated to rise to 30,000 dozens of garments from current 20,000 dozens.

Wang disclosed that Roo Hsing's plant in Vietnam turns out mainly trousers and pants, but now the company is considering expanding its products to include knitted garments. To rapidly enlarge its operating scale, the company intends to subcontract some of its products to local garment makers so that it may push the production volume up to 50,000-60,000 dozens per month.

To meet the growing competition caused by the cancellation of the Multi-Fiber Agreement on global textile quotas effective this year, Makalot has moved to reshape its global deployment of operations without hesitation. The company is planning to lay more emphases on its operations in both Vietnam and Indonesia. In Vietnam it will invest NT$110 million (US$3.24 million at US$1 = NT$34) to set up one more plant to fabricate garments to cash in on further liberalization of the market there.

Besides, down-stream garment makers, Taiwan's up- and mid-stream yarn and cloth producers have also targeted Vietnam as their overseas base for expansions in recent years. Today Nan Ya has become the largest spinner in Vietnam, boasting a total of 300,000 spindles at its spinning plants there.

Formosa Chemical & Fiber Corp., Taiwan's leading manufacturer of nylon filament and an affiliate of Formosa Plastics Group, has some 200,000 spindles in Vietnam and is planning to expand its operating scale there as well. Chung Shing has about 110,000 spindles in Vietnam now and will update some facilities to enhance production efficiency this year.

Market observers believed that Taiwan's textile manufacturers in Vietnam would see a sharp rise in output in the first quarter of this year and enjoy a rosy picture in the near future.