Decision No. 43/2008/QĐ-BCT Approving the Program on the Production of Twill Fabric for Export until 2015

Pursuant to …;

Approving the Program on the production of twill fabric for export until 2015

for export by 2015

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THE MINISTER OF INDUSTRY AND TRADE

Pursuant to Decree No. 189/2007/ND-CP dated December 27, 2007, issued by the Government, detailing the functions, tasks, powers, and organizational structure of the Ministry of Industry and Trade;

Pursuant to Decision No. 36/2008/QĐ-TTg dated March 10, 2008 of the Prime Minister approving the Strategy for the Development of the Textile and Garment Industry of Vietnam until 2015 with a view to 2020;

Based on the proposal of the Vietnam National Textile and Garment Group (Vinatex) at Report No. 1116/TĐDM-KHĐT dated October 22, 2008 regarding the approval of the Program on the production of twill fabric for export until 2015;

Upon the recommendation of the Director of the Department of Light Industry;

DECISION:

Article 1. Approves the Program on the production of twill fabric for export until 2015 of the Vietnam Textile and Garment Industry with the main contents as follows:

I. DEVELOPMENT VIEWS AND OBJECTIVES

Clause 1. Views

a) Develop the Textile and Garment Industry towards specialization and modernization, aiming to achieve a leap in product quality and quantity. Create favorable conditions for the rapid, stable, sustainable, and efficient growth of the Vietnam Textile and Garment Industry;

b) Focus on developing raw material and auxiliary material production, reduce import surpluses, and increase the added value of products within the industry;

c) Encourage and mobilize all economic resources from various sectors and intensify foreign investment attraction to develop raw material and auxiliary material production serving the Vietnam Textile and Garment Industry.

Clause 2. Objectives

a) Concentrate on producing twill fabric for export to meet market demand and customer requirements in a sustainable manner, enhancing economic efficiency and product quality;

b) Strive to produce 1.0 billion square meters of twill fabric by 2010, of which 500 million square meters will be for export; By 2015, produce 1.5 billion square meters of twill fabric, of which 1.0 billion square meters will be for export. Specifically as follows:

1. On culture and family

1. Focus on developing the production of key products that are widely used and have high demand among export-oriented garment enterprises such as cotton fabric, blended cotton fabric for clothing, and fabric for household use...

2. Establish several large-scale dyeing and printing centers to improve product quality, reduce production costs, and ensure environmental standards.

a) Dyeing and printing centers should be located in industrial parks that facilitate electricity supply, water provision, and wastewater treatment;

b) Invest in dyeing and finishing centers linked to market preparation, human resource management and operation training, technology transfer, and environmental treatment. Emphasize the development of weaving factories to provide quality greige fabric for dyeing and finishing.

3. Invest in dyeing and printing in conjunction with international cooperation to access capital, markets, technology, and management experience from countries with developed textile industries and those shifting their focus, such as Taiwan, China, the United States, Japan...

4. Diversify ownership and organize dyeing factories under joint-stock company, production cooperation, joint venture, and association forms, with Vinatex playing a core role.

III. POLICIES AND SOLUTIONS FOR IMPLEMENTATION

1. Policies and solutions related to investment

a) Building centralized textile and dyeing industrial zones and clusters

- Invest in building centralized textile and dyeing industrial zones and clusters, ensuring technical infrastructure conditions, electricity supply, water provision, wastewater treatment, meeting environmental requirements and having trainable labor forces to attract investment in the textile and dyeing industry;

- The Vietnam National Textile and Garment Group completes technical infrastructure systems, stabilizes electricity supply, water provision, and wastewater treatment to meet national standards for existing industrial zones including Hoa Xa - Nam Dinh, Hoa Khanh - Da Nang, and Pho Noi B - Hung Yen;

- The Vietnam National Textile and Garment Group acts as the nucleus in building infrastructure for new centralized textile and dyeing industrial zones and clusters, ensuring conditions for electricity supply, water provision, and wastewater treatment to accept domestic and foreign investments, serving the program's development goals until 2015. The Vietnam National Textile and Garment Group establishes joint-stock companies to invest in centralized textile and dyeing industrial zones and clusters, where the Vietnam National Textile and Garment Group holds controlling shares, and the remaining shares are invited to participate by domestic and foreign partners. From 2008 to 2012: invest in building textile and dyeing industrial zones and clusters in Thai Binh, Ninh Binh, Nghe An, Khanh Hoa, Binh Thuan, Long An. From 2012 to 2015: invest in building textile and dyeing industrial zones and clusters in Ha Tinh, Quang Tri, Tien Giang, Tra Vinh;

b) The Vietnam National Textile and Garment Group acts as the core entity to implement five key dyeing projects from 2007 to 2012

- The Teachang - Vina dyeing factory project in Yen My (joint venture between Vinatex, Thien Nam Company, and Teachang Korea) will reach a capacity of 42 million square meters per year after investment and 63 million square meters per year by 2009;

- The joint venture project between Vinatex, Thien Nam Company, and Teachang (Korea) to produce denim fabric in Hoa Xa (Nam Dinh) will reach a capacity of 45 million square meters per year after investment; - The relocation and upgrading project of Nam Dinh Textile Joint Stock Company's dyeing factory to produce shirt and trouser fabrics from cotton and blended cotton will reach a capacity of 42 million square meters per year by 2010;

- The joint venture project with the ITG Group (USA) to produce trouser fabric in Son Tra will reach a capacity of 38 million square meters per year after investment and 76 million square meters per year by 2010;

- The construction of the Binh An dyeing factory based on upgrading the Viet Thang dyeing factory and cooperating with the Tencate Group (Netherlands) will reach a capacity of 37.5 million square meters per year after investment and 45 million square meters per year by 2010.

c) The Vietnam National Textile and Garment Group leads the implementation of projects supporting the production of twill fabric.

- The establishment of the University of Textiles and Fashion in Thuong Thien - Bac Ninh in the form of a joint venture or joint stock;

- The investment project for an ecological textile laboratory and a fabric design center funded by ODA and state budget;

- The construction of two raw material and auxiliary material centers in Hanoi and Ho Chi Minh City.

d) The Vietnam National Textile and Garment Group builds new dyeing projects to call for domestic and foreign investment from now until 2015.

2. Policies and solutions related to human resource development

a) Implement the Human Resource Training Program for the Vietnam Textile and Garment Industry, prioritizing the training of economic and technical management staff, specialized textile and garment sales staff, technical staff, and skilled workers for key dyeing and weaving projects;

b) Collaborate with foreign partners to train designers and fashion fabric specialists;

3. Policies and solutions regarding science and technology;

a) Reorganize the specialized research institutes towards autonomy and responsibility, possessing sufficient advisory and support capabilities for textile dyeing enterprises to research and implement technological advancements, transfer technology, and enhance production capacity of Vietnamese textile enterprises;

b) Study and apply new raw material production technologies, differentiated textile products, cleaner production technologies in the textile industry, energy-saving technologies, and software applications in design, production management, and product quality control;

c) Establish a system of textile product standards that align with and harmonize with international standards. Support upgrading quality inspection centers to assist textile enterprises in managing product quality and overcoming technical barriers;

d) Construct an eco-textile laboratory and a fabric development center during the period from 2008 to 2010. Investment capital of 48 billion VND from ODA and state budget sources;

đ) Build a database on the textile industry, improve the quality of electronic information websites;

4. Policies and solutions regarding market;

a) The Vietnam Textile and Garment Association acts as the coordinating body working with the Ministry of Planning and Investment, the Ministry of Industry and Trade to organize investment solicitation programs, encouraging textile enterprises from countries with traditional dyeing and weaving industries to invest in Vietnam. Organize participation in trade fairs, exhibitions, and product introductions in domestic and international markets;

b) Textile enterprises should intensify brand building and corporate image promotion among domestic consumers and international buyers;

c) Strengthen legal advice on international trade, while preparing thoroughly to counter new import barriers imposed by other countries;

d) Enhance cooperative relations with major foreign importers;

đ) Establish raw material and auxiliary materials centers, fabric trading centers for both domestic and foreign sewing enterprises;

5. Policies and solutions regarding finance;

a) Mobilize all forms of investment capital from various economic sectors within and outside the country through business cooperation, joint ventures, partnerships, enterprise shareholding, and establishment of wholly foreign-owned enterprises. Encourage enterprises to attract capital through the stock market, commercial loans with or without government guarantees;

b) Develop scientific research plans, human resource training plans, investment promotion plans, trade promotion plans, and report to the State for financial support according to the Prime Minister's Decision approving the Strategy for the Development of the Vietnam Textile and Garment Industry until 2015, with a vision to 2020;

IV. IMPLEMENTATION COSTS OF THE PROGRAM;

1. Capital investment requirements;

The capital required to implement the Program from 2008 to 2015 is 2,570.8 million USD. Of which:

a) Capital for centralized textile and dyeing industrial zones and fiber dyeing projects is 2,464 million USD;

b) Capital for the polyester staple fiber production plant project is 56.5 million USD;

c) Capital for other supporting programs is 50.3 million USD;

Specifically as follows:

The mobilization of capital for implementing the Program is crucial to achieving the development goals of the Vietnam Textile and Garment Industry. The main sources of capital are foreign investors, loans from investment funds, ODA, land transfer fees when relocating factories, and part of the capital from the stock market when enterprises issue stocks and bonds;

2. Capital investment structure;

a) Self-raised capital by Vinatex and other partners: 20% - 30%;

b) Loans from credit organizations and other financial institutions: 70% - 80%;

Article 2. Implementation

1. The Department of Light Industry shall take the lead, coordinate with relevant agencies, units, and localities to direct the Vietnam Textile and Garment Association and the Vietnam Textile and Garment Group to implement this Program;

2. The Vietnam Textile and Garment Group shall be the core entity collaborating with the Vietnam Textile and Garment Association:

a) Coordinate with localities to develop textile and dyeing industrial zones and clusters with adequate infrastructure for electricity, water supply, and wastewater treatment, creating favorable conditions for investors in dyeing and weaving projects and reporting to the Ministry of Industry and Trade for agreement and decision on locations;

b) Directly implement key dyeing and weaving projects to fulfill the Program of producing woven fabric for export by 2015;

c) Implement the Human Resource Training Program for the Textile and Garment Industry and the Program to build the image of the Vietnam Textile and Garment Industry;

Article 3. This Decision takes effect fifteen days after its publication in the Official Gazette;

Article 4. The Director of the Ministry's Office; Heads of Departments: Light Industry, Planning, Finance, Science and Technology, Import and Export; Chairman of the Board of Directors and General Director of the Vietnam Textile and Garment Group; Vietnam Textile and Garment Association are responsible for enforcing this Decision;