More than 2,000 foreign companies from 16 countries and territories have invested around $15.75 tr in Vietnam’s garment and textile sector so far, according to Vietnam Textile and Apparel Association (VITAS) Chairman Vu DucGiang. South Korea is the biggest investor with its investment exceeding $4.4 bn, followed by Taiwan, Hong Kong and Japan. Taiwan’s investment is worth $2.5 bn, Hong Kong’s $2.1 bn and Japan’s $789 mn, according to a report.

Earlier this year, Japan’s ITOCHU Corporation purchased additional 10 per cent shares of Vietnam National Textile and Garment Group (Vinatex) by investing $47 mn, raising its stake to 15 per cent and making it the second-largest stakeholder after the Vietnamese industry and Trade Ministry. Other big foreign direct investment projects include the $80-mn Nam Dinh Ramatex Textile and Garment Factory by Singapore and the $80-mn Ha Nam YKK Factory specialising in zippers and other materials for the garment industry.

Low labour costs and free trade agreements, including the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), have made the Vietnamese garment and textile sector alluring to foreign investors, Giang said. Once the CPTPP comes into effect, Vietnam can increase shipments to CPTPP member countries, which spend up to $40 bn on garment and textile products annually.