The influx of such foreign direct investment is boosting the sector as well as turning Vietnam into a global manufacturing base. 

Itochu bought an additional 10 per cent stake in Vietnam’s state-owned textile and garment conglomerate Vinatex some months ago, bringing its ownership to approximately 15 per cent. It is now Vinatex’s second-largest shareholder next to the ministry of industry and trade which, on behalf of the state, currently manages a 53 per cent stake, according to a report in a Vietnamese news portal. 

With Vietnam being the most recent country to have approved the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), its garment companies are trying their best to reap the benefits being offered by the agreement. 

The Japanese group’s annual apparel exports from Vietnam are worth about $558 million, with about half of this produced by Vinatex. The company plans to boost processing volume and scale up its export value to $878 million by 2021. 

Sakai Amiori has around 30 plants in operation and has opened an export apparel production plant in Phu Ha industrial zone in the northern province of Phu Tho. The plant, completed in April 2017, now sees stable production and exports. 

Japan’s Matsuoka Corporation, which first set foot in Vietnam in 2014 and quickly expanded production to raise capacity six- to seven-fold through the Matsuoka Phu Tho plant that primarily manufactures apparel carrying the Uniqlo brand to be exported back to Japan. 

The company has chosen Vietnam for capital injection and production expansion in recent years to take advantage of the opportunities anticipated to be brought by new-generation free trade agreements. After its first plant in 2016, the second plant began production in last August, with an annual capacity of about two million products.