08:50 | 29/11/2016 Trade
(VEN) - The US, Japan and the Republic of Korea (RoK) are three potential markets for Vietnamese wood, especially because Vietnam is now member of a series of bilateral and multilateral free trade agreements. Southeast Asia Analyst for the Forest Trade and Finance Program To Xuan Phuc talked about export opportunities for Vietnamese wood businesses in an interview with Vietnam Economic News’ Nguyen Hanh.
What are your views on trade turnover of wood and wood products between Vietnam and the US, Japan and the RoK?
Wood exports to the US annually stands at US$2.4-2.5 billion, equaling to around 30 percent of total export turnover of Vietnam’s wood and wood products. In addition, export turnover of wood and wood products is on a raise, with an increase of around 15 percent a year. This brings positive signals for the Vietnamese wood processing sector, especially when Vietnamese wood exports to the EU have shown signs of slowdown.
Japan is considered the second largest export market for Vietnam’s wood and wood products. With the main exports being woodchips, office furniture, bedroom furniture, chairs and other furniture, export turnover of wood and wood products to Japan annually reaches around US$1 billion, accounting for about 15 percent of total export turnover of Vietnam’s wood and wood products. The export growth of to Japan is lower, but more sustainable compared to the US.
The RoK is a smaller market compared to the US and Japan, but is an important one for Vietnam’s woodchip exports. Although woodchip exports to the RoK tend to decrease, some export products among HS94-code wooden furniture are on a raise.
Can Vietnam make most of opportunities to expand exports? What solutions should Vietnamese businesses implement?
The Vietnamese wood sector has been provided many opportunities to expand the market, contributing to promoting advertisement and improving position in the world. However the sector has faced many difficulties because of the using of wood with unclear origin, especially wood from the nature. Therefore, ensuring the transparency of origin is extremely important. It requires businesses to improve information access and accountability, while asking the authorities for greater role.
What policies should Vietnam approve to promote sustainable development?
Policies for the Vietnamese wood processing sector are fairly complete. However to expand the market, more and more support policies are required. Providing up-to-date information for businesses about types of risks, especially risks in imported wood is among most important policies.
I also mention the need of measures to remove risks. For example, small and medium-sized enterprises can come together and offer the process in order to help them avoid risks.
How do you assess the planning of the Vietnamese wood sector?
The Vietnamese wood sector consists of three basic components, including supplies, domestic processing, production and consumption, and exports. Regarding supplies, wood is sourced from domestic forests and imports. Regarding processing, production and consumption, Vietnam has more than 90 million people, so demand on using furniture is on a raise. In addition, exports are increasingly expanded.
However interaction between three components remains weak. Vietnam needs to adopt the planning of the wood sector with direct interaction between three components.
The growth rate of the Vietnamese wood sector annually totals 15-20 percent. Wood exports reached US$6.9 billion in 2015, and are expected to stand at around US$7.3 billion in 2016 and about US$8 billion in 2017. Demand on using furniture in the world is high with turnover of around US$240 billion a year.