Decision No. 42/2008/QD-BCT of November 19, 2008, approving the master plan on development of Vietnams textile and garment industry till 2015 and orientations to 2020.

DECISION

APPROVING THE MASTER PLAN ON DEVELOPMENT OF VIETNAMS TEXTILE AND GARMENT INDUSTRY TILL 2015 AND ORIENTATIONS TO 2020

THE MINISTER OF INDUSTRY AND TRADE

Pursuant to the Governments Decree No. 189/2007/ND-CP of December 27, 2007. defining the functions, tasks, powers and, organizational structure of the Ministry of Industry and Trade;
Pursuant to the Governments Decrees No. 92/2006/ND-CP of September 7, 2006, prescribing the formulation, approval and management of socio-economic development master plans, and No. 04/2008/ND-CP of January 11, 2008, amending and supplementing a number of articles of Decree No. 92/2006/ND-CP;
Pursuant to the Prime Ministers Decision No. 36/2008/QD-TTg of March 10, 2008, approving the development strategy for Vietnams textile and garment industry till 2015 and orientations to 2020;
At the proposal of Vietnam Textile and Garment Group in Document No. 1115/TDDM-TT/KHDT of October 22, 2008, requesting the approval of the master plan on development of Vietnams textile and garment industry till 2015 and orientations to 2020;
At the proposal of the director of the Light Industry Department,

DECIDES:

Article 1. To approve the master plan on development of Vietnams textile and garment industry till 2015 and orientations to 2020, with the following principal contents:

1. Development viewpoints

a/ To develop the textile and garment industry towards specialization, modernization and rapid, stable, sustainable and efficient growth;

b/ To develop to the utmost the domestic market and simultaneously expand export markets; to regard export as a development objective of the industry;

c/ To develop the domestic fashion market in big urban centers and cities. To boost the relocation of labor-intensive textile and garment establishments to rural areas;

d/ To diversify forms of ownership, sizes and types of enterprises; to raise all domestic and overseas resources to develop Vietnams textile and garment industry;

dd/ To develop the textile and garment industry towards investment in specialization and modernization in order to create a breakthrough in both the quality and quantity of products;

e/ To boost the development of support industrial products and production of textile and garment raw and auxiliary materials, to reduce the textile and garment industrys trade deficit and increase its added value;

g/ To develop the textile and garment industry in association with environmental protection and restructuring of rural agricultural labor;

h/ To quantitatively and qualitatively develop human resources for sustainable development of Vietnams textile and garment industry.

2. Development objectives

a/ Overall objectives

- To develop the textile and garment industry into one of the key and spearhead export industries; to increasingly meet domestic consumption demands; to generate major employment for the society; and to raise the industrys competitiveness and steady integration into regional and world economies;

- To ensure sustainable and efficient development of textile and garment enterprises on the basis of modem technology and quality, labor and environ-mental control systems by international standards.

b/ Specific targets:

- From 2008 to 2010, production and export will grow on average at 16%-18% and 20%, respectively, and the export turnover will reach USD 12 billion by 2010;

- From 2011 to 2015, production and export will grow on average at 12%-14% and 15%, respectively, and the export turnover will reach USD 18 billion by 2015;

- From 2016 to 2020, production and export will grow on average at 12%-14% and 15%, respectively, and the export turnover will reach USD 25 billion by 2020.

3. Product development planning and planning arrangement

a/ Planning on strategic products

- To concentrate on the production of fabrics and auxiliary materials to serve export production. In fabric production, to attach importance to the processes of dyeing and finishing products to ensure that product quality meet market and user demands. Investment in fabrics production must ensure that environmentally friendly technologies capable of manufacturing high added value products at low material costs be selected;

- To boost investment in developing cotton, fiber, synthetic fiber and auxiliary material production establishments to raise production and business efficiency and gradually reduce imports to save foreign currencies;

- To boost investment in developing the production of exported garments to make use of market opportunities. Garment enterprises should diversify and improve the grade of their products, actively change their export production mode from receiving raw materials from foreign parties for sub-contract production of exports to buying foreign raw materials for export production on their own, and boost production and business support activities such as fashion designing, supply of raw and auxiliary materials and trade promotion.

b/ Regional-based planning

Textile and garment development shall be planned in the following regions under the following principal orientations:

- Region I: Red River delta

To regard Hanoi as the regional center for providing services and supplying raw and auxiliary materials, technologies and fashion designs and accommodating added-value garment production establishments. To relocate garment establishments to industrial parks such as Hoa Xa (Nam Dinh province), Nguyen Due Canh (Thai Binh province), Pho Noi B (Hung Yenprovince), Dong Van (Ha Nam province) and those in Vinh Phuc, Bac Ninh and Ninh Binh provinces. To form in this region an industrial cluster for manufacturing garment exports and three concentrated textile, dyeing and finishing industrial parks. To invest in a polyester fiber plant with an annual capacity of 160,000 tons in Dinh Vu industrial park (Hai Phong).

- Region II: Southeastern region

To regard Ho Chi Minh City as the regional center for trade, fashion designing, textile and garment technology services and garment plants producing fashion and added-value products. To relocate dyeing and product finishing establishments from Ho Chi Minh City to Long An industrial park and other neighboring provinces. New investment will not be encouraged to avoid labor pressure in this region which has experienced labor problems due to too fast textile and garment development over the past time.

- Region III: Central coastal region

To regard Da Nang city as the regional center for forming an industrial cluster to manufacture garment exports and a number of industrial parks of textile, dyeing and product finishing in Hoa Khanh (Da Nang) and Quang Tri.

- Region IV: Mekong River delta

To regard Can Tho city as the regional center for forming an industrial cluster to manufacture garment exports and a consolidated textile and dyeing industrial park inTra Vinh.

- Region V: Northeastern and northwestern region

To build a textile industrial park in Phu Tho and garment plants in other provinces. To develop cotton growing and silkworm raising areas in Son La and Dien Bien.

- Region VI: Northern central region:

To arrange textile and garment enterprises along national highway 1 with some industrial clusters and points in Bim Son (Thanh Hoa), Vinh (Nghe An) and Hue (Thua Thien Hue). To form three consolidated textile and dyeing industrial parks in Dien Chau (Nghe An), Ha Tinh and Quang Tri from 2012 to 2015.

- Region VII: Central Highlands

To increase specialized cultivation of raw material trees such as mulberry and cotton associated with processing for export and domestic sale. To simultaneously develop garment establishments to meet domestic demands or support garment production in regions II and III.

4. System of solutions and policies for the master plan implementation

a/ Investment policies and solutions

- To associate investment in developing the textile and garment industry with international cooperation, to make the utmost use of the trend of shifting textile and garment investment from developed countries. To encourage all domestic economic sectors to invest in the industry.

- To concentrate on investment in producing fabrics and raw and auxiliary materials for export production. To formulate a program to manufacture shuttle-woven fabrics for the production of garment exports;

- To formulate a program to develop cotton trees under which priority will be given to irrigated cotton growing areas in provinces with potential;

- To formulate investment projects to produce artificial fibers, quality yarns with new properties meeting market demands through joint ventures and partnerships between domestic and overseas enterprises;

- To increase investment in the garment industry to raise its export capacity and create conditions for developing the production of fabrics and auxiliary materials to gradually substitute imports. To relocate garment enterprises from big urban centers to localities to reduce labor pressure and restructure labor in localities;

- To build specialized textile and garment industrial parks in key regions to enable concentrated environmental treatment for new textile and dyeing investment projects and relocate polluting textile and dyeing enterprises out of big urban centers.

b/ Solutions on supply of raw and auxiliary materials

- To build centers in Hanoi, Ho Chi Minh City and other big cities for timely supplying raw and auxiliary materials for textile and garment enterprises;

- To attract foreign investment and raise domestic funding sources for the production of petrochemical products (yarn, fiber, chemical, dye) for textile and garment production to enable independent supply of raw materials and raise the localization rate and added value of textile and garment products.

c/ Market policies and solutions

Export market expansion is a breakthrough in the development strategy for textile and garment exports and a decisive factor for the growth of Vietnams textile and garment industry. To expand markets, the State and enterprises should carry out the following solutions:

State management agencies should:

- Take advantage of all possibilities and opportunities to help enterprises negotiate on the expansion of Vietnams international textile and garment markets;

- Boost the reform of administrative procedures in taxation, customs, export and import by applying one-stamp and one-stop shop mechanism and simplifying procedures. Enhance market inspection, control and combat smuggling and tax evasion;

- Increase international trade law consultancy to help exporting enterprises deal with barriers imposed by importing countries.

Textile and garment enterprises should:

Organize and expand domestic retail networks, renew export marketing methods and pay attention to building and advertising brand names of products and building the image of Vietnams quality, responsible and environmentally friend textile and garment industry on the international market.

d/ Human resource development solutions

To formulate a program on training human resources for Vietnams textile and garment industry:

- To organize the training of administrators, legal experts and technicians, especially fashion designers, planners, marketing officers and skilled workers;

- To combine long-term with short-term training, full-time with in-service training, and domestic with overseas training;

- To consolidate and expand the specialized textile and garment training system, to establish a Textile, Garment and Fashion College to create material foundations for opening training courses.

The Vietnam Textile and Garment Association and Vietnam Textile and Garment Group are responsible for coordinating and connecting domestic and overseas training institutions in implementing the program on human resource training for the industry.

dd/ Science and technology solutions

- To research and apply new technologies and materials for turning out textiles with distinctive properties, implement programs on cleaner production, energy conservation, and application of software to designing and management of the production and quality of textiles and garments:

- To boost research in raw material production to substitute material imports, to make proper imestment in research in designing and quality control of products; to tackle technical barriers imposed by importing countries;

- To reorganize textile and garment research institutes towards autonomy and accountability and raise their consultancy, research and development, technology transfer, designing and patterning capacity.

e/ Environmental protection solutions

- To concentrate on treating water contaminating sources in textile and dyeing companies. To build in textile and garment industrial parks wastewater treatment systems meeting state-prescribed environmental standards;

- To boost the implementation of the cleaner production program in textile and garment enterprises, apply SA 8000 or ISO 14000 standard on environment, products and good working environment for laborers;

- To elaborate and implement a roadmap to renew the textile and garment industrys technologies towards saving raw materials and environmental friendliness;

- To increase the capacity of scientific and technological research in the environment to meet environmental requirements and technical barriers in international economic integration.

g/ Financial solutions

- To encourage all domestic and overseas economic sectors to invest in the industry. To encourage enterprises to join the stock market to create a capital raising channel (through the issuance of bonds, stocks and international bonds);

- The State shall support state budget funds for textile and garment research institutes and training institutions to invest in research and training activities and material and technical foundations to increase their capacity.

Textile and garment enterprises investment projects on environmental treatment are eligible for state credit loans, ODA and loans from the environment facility.

Article 2. Organization of implementation

1. The Ministry of Industry and Trade shall assume the prime responsibility for, and coordinate with concerned ministries, branches and provincial-level Peoples Committees in, implementing the approved master plan.

2. The Ministries of Planning and Investment; Finance; Agriculture and Rural Development; Science and Technology; and Natural Resources and Environment, the State Bank of Vietnam and the Vietnam Development Bank shall, within the ambit of their functions, coordinate with the Ministry of Industry and Trade in supporting enterprises and localities in implementing the approved master plan.

3. Provincial-level Peoples Committees shall concretize the development master plan on the textile and garment industry in their localities and join ministries and branches in examining and supervising the implementation of the approved master plan to ensure conformity and consistency with their local socio-economic development master plans.

4. The Vietnam Textile and Garment Association shall coordinate with the Ministry of Industry and Trade in disseminating and guiding the principal contents of the master plan for textile and garment enterprises nationwide so that they can adopt production and business development orientations and plans in line with the master plan; study and propose to state management agencies adjustments to policies and mechanisms to develop the textile and garment industry according to the master plan.

5. Vietnam Textile and Garment Group, the key enterprise of the industry, shall develop investment in large-scale textile and garment projects and coordinate with the Vietnam Textile and Garment Association in studying and proposing to state management agencies policies and mechanisms to develop the textile and garment industry according to the approved master plan.

Article 3. This Decision takes effect 15 days after its publication in CONG BAO.

Article 4. The director of the Office; the directors of the Departments of Light Industry; Planning and Finance; Science and Technology; Export and Import; and Domestic Market; the chairman of the board of directors and the general director, of Vietnam Textile and Garment Group; and the Vietnam Textile and Garment Association shall implement this Decision.