Vietnam’s Textile Industry

7086 Words29 Pages
This paper seeks to look at Vietnam’s economy, financial sector, and political sector in respect to the textile industry. In an attempt to evaluate the feasibility of entering a foreign market, we focus our paper on a mid-sized company called Augusta Textile Company. This paper seeks to evaluate Vietnam’s potential for investment, particularly in the textile industry. While the company seeks to increase revenues and keep costs of production low, the company must look to expand to growing markets. However, various risks must be taken into consideration, as they can be great barriers to entry. The company looks to expand with the least financial risk, but greatest potential output and revenue. In evaluating the textile industry in Vietnam,…show more content…
Vietnam is now one of the world’s fastest growing economies despite it being one of the region’s poorest countries. It is one of the world’s top exporters of rice, coffee, cashew nuts, and black peper. Due to low cost of human labor and lower operating costs, Vietnam offers plenty of opportunities for international businesses. Hence, many western companies are expanding their business to the area. Textiles and garments are the backbone of the Vietnamese industry, and these sectors contribute greatly to the country’s industrial growth. Since joining the World Trade Organization (WTO) in 2007, the government has strongly supported the textile and garment sectors by providing strong incentives to attract foreign investors (Nieuwoudt, 2009). It is undeniable that the government of Vietnam still has great improvements to make in order to advance in the global market. The country is still considered to be in the early stages of infrastructure development, resulting in a great barrier for the country. Ongoing reforms in the country are helping the economy of Vietnam; however, reform efforts are not efficient or transparent. Vietnam’s economy is driven primarily by tourism and exports as investment is hard due to the absence of transparency in the legal and regulatory system. Company Basics Our company is the Augusta Textile Company, founded in 1985. Being fairly new, it has
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