Introduction The process of economic integration among countries in the world is currently taking place extensively, where export is a factor playing an important role in that integration process. Export creates the main source of capital for imports, contributing to restructuring the economy and promoting production. Export also contributes to creating jobs and improving people's lives, increasing national income, thereby increasing GDP and domestic consumption. Garments are one of the key products of Vietnam.
Business activities in the market economy often contain many opportunities as well as risks, especially in export activities. How can one be successful in the garment product business in the EU market? That is an issue that export business entities are interested in. Besides, what are the barriers that EU enterprises need to overcome in order to penetrate and develop in the EU market? X20 Joint Stock Company - formerly known as Garment Company 20 – was a unit specializing in production of garments for the military. It has then expanded production to the field of knitting, weaving recently, due to the need of change in production and business models.
By diversifying business lines, the company has completed the mechanism to switch to exporting garments. Export is now the main activity that renders profits to the company, therefore increasing the efficiency of the export business is a vital task of the company. Moreover, Vietnam is in the process of comprehensive renovation in every aspects, especially in terms of economy and politics. In the current context, export promotion is being encouraged more strongly than ever.
Vietnam is considered one of the countries with the fastest integration speed in the world. From 2001 to the present, Vietnam has signed a Bilateral Trade Agreement with the United States (BTA), joined the World Trade Organization (WTO), and signed trade agreements as a member of ASEAN with Japan, China, Korea, Australia, New Zealand, and India. Notably, the newly signed Vietnam - Europe Free Trade Agreement (EV-FTA) in early 2020 has opened up a lot of opportunities and incentives for many export items of many industries, including garments. Recognizing the significant role of export in production activities of the company, I have chosen the topic "Solutions to promote export of garments of X20 Joint Stock Company to the European market under the implementation of the Vietnam-European Union Free Trade Agreement (EV-FTA) ”.
In the article, I have given some theories about export activities such as concepts, roles, influencing factors. After a period of direct contact with production - export activities of the company, I have realized a number of advantages and limitations in exporting activities of the company, from which I have also 1 provided analysis and some solutions to help the company overcome the limitations, and at the same time take full advantage of the strength to grow continually and sustainably under the signing EV-FTA agreement. The urgency of the topic Currently, the process of international economic integration is taking place extensively. Since signing the Trade Agreements, Vietnam has more opportunities to exchange and develop economy with countries around the world.
Vietnam's economy has been gradually changing, and one of the basic activities to promote the integration process is export. Export activities contribute to restructuring the economy, promoting production and development, creating conditions for other industries to develop. In fact, in recent years, Vietnam has affirmed its position in the garment industry, being one of the export industries that brought the major source of foreign exchange in the country's industrialization process. However, with the growing development of the garment industry, domestic enterprises engaged in textile and garment export activities also revealed many shortcomings.
X20 Joint Stock Company is a garment exporting enterprise. During my internship at the company, I realized that there were still limitations in the company's export performance. Since then I have chosen the topic "Solutions to promote export of garments of X20 Joint Stock Company to the European market in the context of the implementation of the Vietnam-European Union Free Trade Agreement (EV-FTA ) ”, to provide an analysis of the new export context of our country at present, as well as to make several proposals to overcome the limitations and contribute to improving the export efficiency of enterprises. Research purposes - Systematize theoretical bases on export and export business efficiency - Assessment of conditions in the Vietnam - European Union Free Trade Agreement (EV- FTA) - Analyzing and assessing the status of garment export activities of X20 Joint Stock Company - Proposing several solutions to improve the export business efficiency of the company shortly.
Subject of the study 2 Export activities of X20 Joint Stock Company 4. Scope of research Scope of space: X20 Joint Stock Company Time range: Research data for the years 2015-2019 5. Research method Methods of data collection: Collection of primary and secondary data, descriptive statistics. Methods of analysis and data processing: Methods of proportional analysis, comparison method, balanced contact.
The structure of the thesis The thesis consists of 4 chapters: Chapter 1 : Chapter 2 : Chapter 3 : Chapter 4 : 3 Chapter 1: General theories of garment export 1. Concept and characteristics of export “Export of goods is the sale of goods and services to another country on the basis of using currency as a means of payment, with the goal of profit. The currency here may be a foreign currency for one country or many countries”. The purpose of this activity is to acquire a foreign currency based on the exploitation of comparative advantages of each country, when the exchange of goods between countries is beneficial, the countries are actively involved in expanding this activity.
Since export is a part of international trade, it also has characteristics and relates to other international trade activities such as international insurance, international payments, international transportation, etc. Export activities are not the same as domestic trading in the characteristics of the participation of foreign partners, the goods serving the consumption demand outside the territory. Export activities take place in all fields, in all conditions of the economy, from exporting consumer goods to production materials, machinery and high-tech equipment. All of these activities are aimed at benefiting the nation in general and the participating businesses in particular.
Export activities take place widely in space and time. It can take place in a very short time but can last for years, can take place within a country or many different countries. The role of export Export activities bring many benefits to the nation. It not only benefits businesses but also contributes to boosting domestic production by accumulating foreign currency earnings for the country, promoting the creativity of economic units through international competition.
Import and export business is also a means to exploit the advantages of nature, geographical position, human resources and other resources. In addition, export activities also promote international cooperation between countries and accelerate the process of global economic integration. - For the national economy Export is one of the factors creating momentum, promoting the growth and economic development of each country. Most theories about economic growth and development confirm and specify that for growth and development, each country needs four 4 conditions: human resources, resources, capital, and technology.
But most developing countries (like Vietnam) lack capital and technology. So the question that must be answered is how to get capital and technology? Exports create a source of capital for imports to serve the industrialization and modernization of the country. For every developing country, the most appropriate step must be to industrialize and modernize the country to get rid of poverty and backward development. However, the industrialization process requires a large amount of capital to import advanced equipment technology.
To obtain imported capital, the former countries have used the following main sources of mobilized capital: + Foreign investment, borrowing from aid sources + Revenues from tourism activities, foreign currency collection services in the country + Income from export activities The importance of foreign investment is undeniable, but raising this source is not easy. To use this source of capital, the borrowing countries will suffer disadvantages, face many unfavorable conditions, and will have to make commitments with the lending organizations/countries in the future. Exporting, therefore, is an activity that creates a very important source of capital. + Export creates a premise for import, deciding the scale of the growth rate of import activities.
In some countries, one of the main causes of underdevelopment is due to the lack of capital potential, so the external capital is essential, but all opportunities for investment, debt, and aid of foreign countries are only advantageous when investors and lenders see the ability to produce and export - the only source of capital to pay debts into reality. + Export promotes economic restructuring, production development. Under the impact of exports, the world's production and consumption structures have changed drastically. Exports move countries' economic structures from agriculture to industry and services.
There are two perspectives on the impact of exports on production and economic restructuring: Firstly, only export the surplus products compared to the domestic demand. In the case of an outdated economy and production retardation, not enough to consume, if only passively waiting for a surplus of production, exports are limited in small scale and 5 growing slowly, Therefore, manufacturing industries will not have opportunities to develop. Second, base on the world market to produce and export. This view has a positive impact on economic restructuring to boost exports: + Exports create a premise for industries to develop together.
This can be for example, when developing the export garment industry, other sectors such as cotton, spinning, dyeing, etc. will have favorable conditions for development. The raw materials produced locally will be much cheaper than imported, moreover this proves the position of the garment industry, paving the way for export products of uniform quality. + Export facilitates expanding product market, contributing to stabilizing production, creating advantages thanks to scale.
When bringing Vietnamese products to other markets and being known by consumers, it will increase demand and boost the production of such products. When the item has a certain number of customers, the production line will also be operated continuously and the scale can be expanded to meet the requirements of customers. + Export facilitates the expansion of the supply of inputs for production and the expansion of a country's consumer market. When manufacturing a product, businesses must consult and search for similar items and models to estimate what materials to enter to improve quality and product design.
When doing this activity, raw materials will be richer gradually with each item. This allows a country to consume all the goods in quantities that are many times greater than the country's production capacity, even those that they cannot produce. + Export contributes to promoting specialization, increasing the production efficiency of each country, aiming to develop strongly in width and depth. In today's modernized globalized economy, each product is researched and tested in the first country, manufactured in the second, assembled in a third country, and consumed in the second.
Those investments and products were eventually paid in the fifth country. Thus, the goods produced in each country and consumed in one country show the opposite effect of specialization on exports. With the important feature that the currency is used as a means of payment, exports contribute to increasing a country's foreign currency reserves. Especially for developing 6 countries, where currencies are not convertible, foreign currencies earned from exports play an important role in regulating the supply of foreign currencies and stabilizing production, thereby contributing to economic growth and development.
+ Exports have a positive impact on creating jobs and improving people's lives. In terms of jobs, exports attract millions of workers through the production of exports. On the other hand, exports create foreign currencies to import consumer goods to meet the increasingly diverse and abundant needs of the people. Therefore, consumers will be able to use many products with better quality as well as higher usability.