With the demand to import more than $10 billion worth of apparel products each year, Russia is a market with potential for Vietnamese garment-textile businesses. According to the Vietnam Textile and Apparel Association, businesses have received many jackets and jeans orders from Russian companies in recent years.
The garment-textile industry was predicted to get the most benefits when the free-trade agreement between Vietnam and the Eurasian Economic Union came into force in October 2016. At present, Vietnam exports about $320 million worth of apparel each year to Russia, making up roughly 2 per cent of the country’s total exports. The figure is expected to exceed $1 billion, accounting for 10 per cent of total exports, in the next few years. According to the Vietnam Textile & Apparel Association, Russia has a cold climate, so its consumers have a big demand for jackets and jeans.
“However, the problem is how to bring the products into the market at competitive prices since Russia still faces economic difficulties and sales of apparel in the market are not as strong as in the European Union,” the association adds.
Additionally, the geographical distance between Vi?t Nam and Russia would make it difficult for businesses to complete payment,and that more bank branches should be opened in Russia for direct payment between businesses, says the association. Meanwhile, according to the Vietnam Customs, garment-textile export turnover to Russia increased by over 30 per cent year-on-year to reach $110 million in 2016.