Roger Lee, CEO of TAL Group, revealed this plan at a meeting with leaders of the Ministry of Planning and Investment this Wednesday.
TAL currently has 25,000 workers at eight factories worldwide. The Hong Kong clothing producer came to Vietnam in 2004 to set up the US$40-million textile-garment factory Viet My (TAV Limited) in Phuc Khanh Industrial Park in Thai Binh Province, where more than 3,000 workers are working.
TAL intends to open a second factory in Vietnam with an estimated investment of US$200 million in the first phase. The plant will apply modern and environmentally friendly technology.
Lee said that during his visit to Vietnam, he would also meet representatives of the Ministry of Industry and Trade and Vietnam National Garment and Textile Group (Vinatex) to discuss the project. TAL wants the planning ministry to give it advice on a suitable location for its new project, says the website of the planning ministry.
Deputy Minister of Planning and Investment Cao Viet Sinh said TAL should consider factors like road access, labor, land rent, assistance from local authorities and the current situations in some northern provinces like Hai Duong, Hung Yen, Ha Nam and Nam Dinh before coming to a decision.
The planning ministry is willing to support and offer TAL favorable conditions to expand investment in Vietnam. The ministry will ask its Foreign Investment Agency to directly work with TAL to accelerate the project development, said Sinh.
According to textile-garment firms the chance to attract foreign direct investment (FDI) into material production to enjoy the incentives offered by the Trans-Pacific Partnership (TPP) and free trade agreements (FTA) is being realized, said the industry players.
Since last year, multiple foreign fiber, yarn and textile producers have come to Vietnam to seek opportunities for investment in textile, dyeing and material production.
Large firms like Texhong and Sunrise of China, Toray International and Mitsui of Japan, and Lenzing of Austria have expressed interest in forming joint ventures with Vinatex or its subsidiaries.
Several projects have been set up. For example, Thien Nam Sunrise Textiles JSC, a joint venture between Thien Nam Investment & Development JSC of Vietnam and Sunrise Textiles Co. Ltd. of China, was established in November last year. The venture will develop a factory in Bao Minh Industrial Park in Nam Dinh with a monthly capacity of one million meters of woven fabric and 300 tons of knitted fabric.
Recently, South Korean textile company KyungBang has opened a plant in Binh Duong costing US$40 million in the first phase to utilize tariff incentives under Vietnam’s regional and international commitments. Lee Kap Soo, general director of KyungBang Vietnam Co. Ltd., revealed this textile plant was part of KyungBang’s plan for US$140- million investment in Bau Bang Industrial Park.
After building two plants in Dong Nai and Quang Ninh, Texhong of China has worked with Vinatex over its third production facility in Vietnam.
Lenzing of Austria wants to join hands with Vinatex to develop a system of integrated plants for production of wood pulp and viscose rayon in Vietnam.
Foreign investors are coming to Vietnam to form a partnership in the textile-garment sector because Vietnam is in talks over TPP and an FTA with the EU.
If negotiations were successful, TPP would come into force in 2015. Then, textile-garment products made of locally-sourced materials would enjoy a zero tariff when exported to the TPP markets, urging foreign investors in pour capital into textile-garment material projects.
With the Generalized System of Preferences (GSP) of the European Union, effective from January 1, 2014, the Vietnam-Japan Economic Partnership Agreement (VJEPA) and negotiations over TPP, the textile-garment industry has great chance of expanding its markets, said experts.