Slow Green Transition Causes Vietnam's Apparel Sector to Lose Orders to Bangladesh

Vietnam’s textile and garment industry has lost orders to Bangladesh due to its slow green transition, and may lose its position as the world’s second-largest exporter of apparel products.

Bangladesh has been quicker in greening supply chains, improving its exporters’ competitiveness and opportunities to secure orders. Bangladesh has 153 apparel factories meeting Leadership in Energy & Environmental Design (LEED) standards and 500 others have applied for the certification.

In contrast, Vietnam has been tardy in green transition, and enterprises that wish to satisfy the global market’s requirements must prioritize “green” and “digital” factors. Greening production will help protect competitiveness, maintain production, and sell products to other markets.

Enterprises meeting Environmental, Social, and Governance (ESG) standards have more orders and better orders. Vietnam needs $14-15 billion annually to fulfill green commitments and achieve net-zero emissions by 2050.

The city of Ho Chi Minh is pursuing green export and developing industries meeting international circular economy standards. Green commitments will pave the way for the export of enterprises’ products and facilitate them to enjoy tariff incentives.