London-based New World Fashion Group (NWF) has started construction of an eco-garment plant in Vietnam that will supply garments for UK retailer Tesco.

The plant, named Dong Tai Garment, arises from an agreement between the two companies signed last month.

Tesco is expected to purchase garments worth US$180m from the factory which is located in the Nam Tai industrial zone, in the northern province of Hai Duong.

Construction of the plant is costing $200m, spanning 10,000 square metres and employing 1,200 local workers.

Its water treatment system and a solar power system will make Dong Tai Garment the first eco-plant of its kind in the country.

In addition, NWF is planning to build a clinic, school and accommodation for workers and their families.

NWF already has a five-line garment plant named Excel Tailoring at the Dong Tai industrial zone, with 500 workers.

NWF, which operates ten garment plants across Vietnam, has other UK clients including Warehouse, TK Maxx, Oasis and Primark.

By Ngo Tuan.