Vietnam aims to become one of the top five textile and clothing manufacturing and exporting nations by 2020, while simultaneously fostering social improvements and environmental well-being, according to recent research.

In value terms, the industry has set an export target in the range US$20-22bn for 2020. It aims to achieve this leap forward by concentrating on a strategy of specialisation and modernisation, as well as through an increase in added value.

The process of value addition has already started. Between 2005 and 2011, the added value rate of Vietnam's textile and clothing exports increased markedly, from 30.2% to 47.8%. Over this time period, exports more than trebled from $4.8bn to $15.8bn.

The momentum continued into 2012 with textile and clothing exports during the first nine months of the year up by 7.4% compared with the corresponding period of the previous year, to $11.14bn.

That said, the export target for 2015 has had to be moderated to $14-16bn, which is similar to the current level, in recognition of tougher economic conditions in its two main markets, the USA and the EU.

Looking further ahead, there are ambitious plans to achieve a strong advance in exports and retain the textile and clothing industry's status as one of the country's most important sectors.

To aid in these plans, the government has established a series of incentives to attract and encourage the kind of foreign direct investment (FDI) which is most likely to drive the country's future development.

In addition, Vietnam has secured free trade agreements (FTAs) with a number of countries and regions. In particular, through its membership of the Association of Southeast Asian Nations (Asean), it benefits from the Asean China Free Trade Area (ACFTA), which is the world's largest FTA in terms of the total population of its signatories.

In addition, again through its membership of Asean, it benefits from FTAs with Australia and New Zealand, India, Japan and South Korea. Also, it has bilateral FTAs with Israel and Japan.

Furthermore, Vietnam has entered into negotiations with the EU with a view to signing a comprehensive FTA. Most importantly, it has entered into negotiations to be part of the Trans Pacific Partnership (TPP), which aims to establish a free trade area for the Asia Pacific region.

Click here for more information on "Prospects for the Textile and Clothing Industry in Vietnam," published by Textiles Intelligence in Global Apparel Markets.