Vietnam textile firms struggle to collect dues from US buyers

May Song Hong saw its dues outstanding from American companies rise by 19.5 percent in the first quarter to VND654 billion ($24.2 million).

It has had to increase its provision for bad debt to over VND224 billion, especially after getting only 17 cents on the dollar from fashion firm New York & Company, whose parent filed for bankruptcy last July amid the Covid-19 pandemic.

It also meant May Song Hong’s revenues increased by a mere 1 percent year-on-year in the first quarter to VND945 billion.

Thanh Cong Textile Garment Investment Trading recorded dues outstanding of VND405 billion as of March, a 43 percent increase since the beginning of the year.

A quarter of that amount was owed by two subsidiaries of U.S. retailer Sears, which filed for bankruptcy in 2018.

TCM’s revenues rose by nearly 20 percent in the first quarter to VND946 billion.

In the first four months textile and garment exports rose 9 percent year-on-year to $9.5 billion, according to the General Statistics Office.