WWF and VITAS aim to green Vietnam’s textile and apparel sector through improved water management and energy sustainability
The textile and apparel industry is one of Vietnam’s most economically important sectors. It contributes 15% of total export value and has a steady annual growth rate of 12% between 2010 and 2017. With 6,000 factories nationwide and employing 3 million people, the sector is not only economically but socially important for Vietnam.
However, the sector can also cause environmental impacts. Intensive water extraction, use and discharge of wastewater and high energy consumption for water heating and steam generation mean that the sector can have significant impacts on water resources and greenhouse gas emissions. As the industry continues to expand, changes in practice will be required to reduce impacts and adapt to changing conditions; for example, the United Nations predicts that water supplies will suffer a 40% shortage globally by 2030.
“Vietnam ranks as the fifth largest exporter of apparel goods in the world, but our industry is more famous for low cost production with limited environmental standards. With customers worldwide now more conscious about the environment, this is forcing a lot of global brands to change their operations to include higher environmental and social standards. If we do not change our practice now, Vietnam could lose its competitiveness, “said Mr. Vu Duc Giang, Chairman of VITAS. “That is why this project is so important and timely.”
The project will be implemented from 2018 to 2020 with a vision to transform the textile-apparel sector in Vietnam. It will achieve this through engaging the industry and influencing environmental governance in order to bring social, economic, and conservation benefits to the country. Geographically, the project will focus on the Mekong and Dong Nai deltas where more than half of Vietnam’s apparel factories are located.
The main focus of the project is to improve water and energy sustainability within the sector, thus reducing its impacts to the environment. The project will also work with textile–apparel manufacturers to encourage them to be more active river stewards, practice sustainable energy planning and discuss collective actions to achieve long term sustainable investments and development in the textile-apparel sector.
One important target of the project is influencing Vietnamese textile investors to implement more sustainable practices. The Chinese textile investors who have in the past increased their foreign direct investment in Vietnam’s textile –apparel sector will engage in the project and share their own lessons.
HSBC has long been involved in supporting the conservation of the world’s water source through the HSBC Water Programme, an 8 year USD150 million project starting from 2012. The “Driving impact reduction through the textiles value chain” belongs to pillar Sustainable Network and Entrepreneurs, one of three pillars under HSBC’s current sustainability strategy aiming at supporting the shift to sustainable global supply chains.
“HSBC has strong determination to preserve the environment and support green businesses”, said Mr. Pham Hong Hai, CEO of HSBC Vietnam, “As Vietnam is more and more integrated in the world through FTAs like CPTPP, EVFTA, bilateral free trade agreements, FDI inflows are forecasted to continue to be robust, and textile and garment, one of the top export industries, is the one that will benefit. However, Vietnam’s enterprises are required to considerably raise their ethical and environmental standards to align with the world business’s community or lose out in global competition. As the world’s leading international bank, HSBC is committed and proud to be the contributor to the greening of Vietnam’s textile and garment sector, a very important sector in term of social, environmental and economic impacts, in the next chapter of international trade.”
“For WWF, greening the textile sector in Vietnam is also a means to achieve our wider goal of addressing river governance and energy sustainability, which are top global environmental concerns. In the long run we want to see factories, industrial parks and other actors come together to take more proactive collective actions to address risks and impacts beyond their factory fences and more responsibly manage shared resource uses across-sectors.” Marc Goichot from WWF-Greater Mekong. “With more than 10 years of working with the textile industries of top exporting countries as Bangladesh, China, India and Pakistan, WWF believes that we can help Vietnam to create a big positive change for the sector.”
The project is implemented by WWF in collaboration with VITAS. Key stakeholders in the project include international brands with suppliers in Vietnam, factories around the country, in particular in the Mekong and Dong Nai delta in areas around Ho Chi Minh City, financial institutions, development partners and other relevant initiatives. Other partners include stakeholders outside Vietnam such as China National Textile and Apparel Council (CNTAC) and Lancang-Mekong Cooperation (LMC).