Taiwan's Far Eastern New Century expands in Vietnam
TAIPEI -- Taiwan's leading textile maker Far Eastern New Century said on Monday that Vietnam would be the best destination to diversify its manufacturing base from China due to lower labor costs and tariffs in the Southeast Asian country.
"We cannot think of a market better than Vietnam to build our new manufacturing base," said Eric Hu, president of Far Eastern New Century, on the sidelines of a trade show on Monday.
"Vietnam offers cheap, quality labor, and it may also benefit from the Trans-Pacific Partnership," said Hu.
The TPP aims to create the world's largest free trade bloc, and its 12 member states including the U.S. and Vietnam signed an agreement in February. However, the pact still needs to be approved by the parliaments of the participating countries.
Far Eastern currently supplies textile materials for global brands such as Nike, Under Armour, Adidas, H&M, Columbia, Uniqlo's parent company Fast Retailing and J.Crew.
Hu said Far Eastern was doubling production lines at its clothing factories in Vietnam and output at its fabric dyeing and finishing plants would grow by more than 300% in a year.
The Taiwanese company would continue to build more facilities including fabric and yarn factories later in Vietnam, according to Hu.
Far Eastern said that it would not suffer any negative impact from fellow Taiwanese conglomerate Formosa Plastics Group's problems in Vietnam.
FPG paid a fine of $500 million in August to Hanoi after its steel unit in the central Vietnamese province of Ha Tinh was said to have polluted waters and caused the mass death of fish earlier this year. Taipei-listed Formosa Plastics is the group's petrochemical operations.
Hu's comments reaffirmed Far Eastern Chairman Douglas Hsu's announcement earlier this year to more than double investments in Vietnam to $760 million from $300 million.
The move is also in line with Taiwanese President Tsai Ing-wen's pledge to boost economic ties with Southeast Asia and South Asia, while distancing the island from China, Taiwan's top trade partner with $160 billion annually in bilateral trade.
