Normalizing diplomatic ties with Viet Nam 17 years ago, the European Union has become an important trade partner for Viet Nam and a large market for many Vietnamese goods, including leather, footwear, textiles and garments.

Leather and footwear exports currently represent 60 percent of Viet Nam's export revenues to the EU. Even though Vietnamese leather shoes were levied an anti-dumping tax rate of 10 percent, Viet Nam's footwear export turnover to the EU reached 1.96 billion USD in 2006, a 10 percent year-on-year increase.

After Viet Nam and the EU signed minutes against fraud in footwear trade, its export value to the EU has annually increased by more than 10 percent.

Following footwear, textiles and garments are the country's 2nd largest export to the 27-country economic bloc. Last year, textile and garment exports fetched more than 1.24 billion USD, a 40.9 percent increase over last year.

The 1993 Viet Nam-EU agreement on textiles and garments enabled the export of the products, previously banned to this market to increase by 38-40 percent annually.

The abolition of export quotas for these goods to the EU as from early 2005 has also helped Viet Nam promote exports to the bloc.

According to Vo Tri Thanh, Head of the International Economic Integration Policy Research Department, under the Central Institute for Economic Management, as a member of WTO, Viet Nam will have opportunities to boost exports to the EU - the world's second biggest importer.

However, the economic bloc with 27 member countries is known as a strict market, requiring Vietnamese businesses, in particular those operating in the garments and textiles sector to work hard to meet requirements and standards and to consider market demand as an indispensable part of their production and trade strategy, especially since the country joined the WTO in 2006.

Nguyen Bao - Deputy Director of the Trade Promotion Department under the Ministry of Industry and Commerce, attributed the slow growth in export turnover of the apparel and footwear sectors to businesses' dependence on materials. Most of them do outwork for joint ventures or wholly foreign-owned companies.

In order to improve the competitive edge of the garments, textiles and footwear industries, Bao said local businesses should restructure their outwork mechanism, invest in renovating equipment, technology and design as well as building trademarks.

Under a development strategy for garments, textiles and footwear by 2010, Viet Nam continues to consider the EU as one of its key importers.

In order to attaining a total export turnover of 10-12 billion USD in 2010, the garment sector will concentrate on developing locally made fibre and producing 1 billion metres of fabric to serve garment exports through 2015, said Chairman of the Viet Nam Garment and Apparel Association (Vinatex), Le Quoc An.

The sector will also improve the weaving and dying quality and build three garment and textile industrial zones equipped with modern facilities to attract foreign investment, An said.

A programme to modernize the garment sector will be pursued to develop a staff of fashion designers as well as promote the image of the Vietnamese fashion industry and trademarks for high-quality products, he added.

The footwear sector has also put forth a series of measures to improve the production quality in an effort to attain an export turnover of 6.5 billion USD in 2010.-(VNA)