To achieve better results in 2025, breakthrough progress is needed

16/12/2024 16:09

2024 was a challenging year for Vietnam’s economy, marked by global geopolitical fluctuations and severe natural disasters both domestically and internationally. Despite this, Vietnam’s economic growth reached an estimated 6.8–7%, thanks to effective government management and the efforts of businesses. This result indicates that Vietnam’s economy has regained its pre-COVID-19 growth momentum. However, achieving better outcomes in 2025 will require breakthroughs and progress. The Vietnam National Textile and Garment Group (Vinatex) has emphasized the need for thorough preparation in markets, finances, and human resources to meet the evolving demands of the domestic and international textile garment markets.

Positive Signals

The global textile market began showing signs of recovery mid-year, as central banks like the Federal Reserve (FED) and the European Central Bank (ECB) signaled cuts in interest rates, leading to improvements in employment and incomes. For 2024, the global textile – garment demand is estimated to reach $794 billion, up 3% from 2023, but still 8% lower than in 2022.

Vietnam’s textile & garment industry also has an opportunity to reclaim its position as the world’s second-largest exporter, with projected export revenue of $44 billion in 2024. However, challenges such as limited logistics infrastructure and labor shortages in major industrial zones have created significant production hurdles.

In this context, Vinatex implemented several measures to sustain and enhance business operations:

  • Garment Sector: Maintained growth momentum with improved business performance starting Q3/2024, and no unit incurred losses.
  • Yarn Sector: Reduced losses by 90% compared to 2023, though persistent difficulties continue to hinder effectiveness.

Overall, Vinatex safeguarded its core resources—labor and customers—achieving the following:

  • Consolidated revenue: 18.1 trillion VND (102.8% yoy).
  • Pre-tax profit: 740 billion VND (137.5% yoy).
  • Average income: 10.1 million VND/person/month (106.9% yoy).

Innovations in 2024

  • Established the Product Development and Fashion Business Center.
  • Fully implemented the ERP system to enhance management and productivity.
  • Promoted sustainability efforts, including wastewater treatment and developing a model green industrial park.
  • Improved production efficiency in the yarn sector, reducing losses by 90% compared to 2023.

Outlook for 2025

Forecasts for 2025 suggest continued unpredictability and challenges, requiring close monitoring and updates. According to the IMF’s October 2024 Global Economic Outlook, global growth is expected to stabilize at 3.2% in 2024 and 2025. While monetary easing and inflation control offer optimism, risks such as supply chain disruptions, geopolitical instability, and climate change persist.

For Vietnam, stable economic growth is projected, with opportunities arising from shifting textile orders away from China due to tariff policies. While challenges remain, Vinatex aims to increase revenue by 6% and profit by 10% compared to 2024.

Strategic Directions for 2025

  • Yarn Sector:
    • Expand cooperation in global supply chains.
    • Standardize management data and upgrade technology.
    • Deepen integration into global value chains while maintaining product quality and internal markets.
  • Garment Sector:
    • Strengthen connections among Group enterprises and align garment operations with textile-dyeing units.
    • Invest in smart garment technologies to boost productivity and reduce reliance on manual labor.

By executing these strategies, Vinatex seeks to secure growth and maintain competitiveness in the global market in 2025 and beyond.

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