Hanoi (VNA) - The domestic leather andfootwear industry was in good shape to reach its goals this year, according toPhan Thi Thanh Xuan, Vice Chairwoman and General Secretary of the Vietnam Leatherand Footwear Association (Lefaso).

The industry's industrial production index in 2020would increase by about 11 percent and the localisation rate of productswould hit 60 percent, she said. 

The industry’s footwear and bag export value was forecast toreach 24 billion USD in 2020, gaining 10 percent compared to the figure last year.

Xuan said this year, the US-China trade war as well as tradeconflicts between the US and other trade partners such as Europe and Indiawould likely decrease, while the global economy would graduallyrecover.

Besides that, orders for footwear andbag would continue shifting from China to Vietnam to take advantageof preferential tariffs from free trade agreements, she said.

Therefore, Lefaso forecast that the demand for localfootwear products in Vietnam’s main export markets would increase thisyear.

Foreign direct investment (FDI) enterprises wouldcontinue to expand production, helping the footwear industry maintainexport growth.

According experts, the domestic leather and footwear industryhad many opportunities to expand into new export markets. However,businesses needed to target value-added products and high-end brands forhigher profits.

In addition to opportunities, free trade agreementswould create many challenges for domestic footwear enterprises, so theyneeded to renew technology, improve production capacity, develop export marketsand improve competitiveness.

According to the association, the industry must develop itssupport industries and raw materials, and increase labour productivity. Itshould also encourage investment to develop footwear production in central andsouthern provinces.

The association also said the biggest difficultyfacing the leather and footwear industry was quality human resources.Businesses must retrain most of their staff who had not been trainedat vocational schools.

In terms of exports, the industry last year gained stablegrowth and maintained competitiveness in traditional markets. The top fivemarkets accounted for over 82 percent of total national footwear exportvalue, including the US, the European Union, China, Japan and the Republicof Korea.

Xuan said total export value of footwear and bags reached 22billion USD last year, including 15.1 billion USD, or 75.8 percent, from FDIenterprises. 

The gap in export value between FDI and domesticenterprises has been narrowed. Domestic enterprises accounted for19.7 percent of the nation's footwear and bag export value in 2017, andthat figure surged to 24.2 percent in 2019. This confirmed the recovery ofdomestic footwear enterprises./.