Opportunity to surpass the export target of 11 billion USD: Promote the intrinsic value of the business

According to statistics of orders that businesses have signed by the end of the first quarter of 2019, the total value has reached about 70% of the target of 11 billion USD. The wood industry will have the whole second quarter to look for more contracts, because in the last 6 months of the year, businesses will have to focus on production to keep up with export orders, so the export target is 11 billion USD. is not high, and the wood industry has a chance to surpass this number, as suggested by Prime Minister Nguyen Xuan Phuc. To surpass the export target of 11 billion USD, the wood industry needs about 42 million m3 of raw wood, which is an increase of 3 million m3 of wood compared to 2018.

In terms of volume, this is not a difficult number to meet, but the problem lies in quality. Currently, Vietnam's plantation timber area with sustainable forest management certificate (FSC) is about 240,000 hectares, providing the market with nearly 10 million m3 each year. In addition, there are rubber wood and home-grown wood (mango, jackfruit, longan, cashew, oval ...), each year providing about 10 million m3 more. Vietnam is also allowed to use two other types of wood for processing forest products for export, which are controlled timber (without FSC but have proven legality) and timber belonging to projects under construction of FSC, and natural resources. imported wood materials.

Currently, for imported wood, we have 100% control over the origin. In order to ensure that the source of timber is of legal origin, one of the tasks set out is to use sustainable wood. Using high technology, circulating technology to make the most of raw materials. But the most important thing to realize the goal of surpassing 11 billion USD in export value, enterprises themselves are the ones who play the most important role. Enterprises in the industry are currently implementing a lot of sustainable development models and achieving high results, but to reach further, businesses need great support from management and investment policies. government. But this development is uneven, Mr. Nguyen Ton Quyen, Vice Chairman of Vietnam Timber and Forest Products Association said, businesses in the wood industry are having 3 big problems, although they have improved a lot but still imqualified. That is the level of management, low labor productivity and lack of capital to invest in technology depth. The three issues above are directly related and affect each other, and the Government will need other solutions to help businesses solve these problems. Another issue that the Government needs to pay attention to is the aspect of attracting foreign direct investment (FDI) in the wood industry. Vietnam has 821 FDI enterprises participating in the wood industry, contributing $ 4.3 billion to exports in 2018. Meanwhile, 1,500 domestic enterprises only contributed $ 5.7 billion to exports. Although the absolute value generated by domestic enterprises is greater, the productivity is only about 1/2. In all three aspects: market, capital and technology, FDI enterprises outperform domestic enterprises. According to Ms. Do Bach Tuyet, Director of Woodsland Joint Stock Company, in order to remove difficulties for businesses, ministries and sectors should continue to cut some unreasonable costs that remain in stages of the supply chain and construction. building large areas of wood materials, meeting quality for processing. At the same time, apply corporate income tax incentives to the forestry sector similar to the fisheries sector. Responding to this issue, Minister of Agriculture and Rural Development Nguyen Xuan Cuong said that, in terms of policy, the Government has opened all the doors for the wood industry, from tax, customs, logistics, to financial support. Recently, at a working session of the Prime Minister's Working Group led by Minister, Chairman of the Government Office Mai Tien Dung, a meeting was also held with 5 ministries and associations (including the Association of Southeast Asian Nations). Vietnam Timber and Forest Products Association). Accordingly, all 4/4 recommendations of businesses in the wood industry have been reviewed and adjusted by the Working Group to direct ministries and sectors to create favorable conditions for businesses. In the coming time, the Ministry of Agriculture and Rural Development will continue to study and propose to promulgate a number of mechanisms and policies to remove difficulties and create an environment to promote start-ups. Restricting the export of raw wood. Develop large wood material areas and supporting industries. At the same time, expanding the distribution network associated with branding for Vietnamese wood. Agreeing with Mr. Nguyen Xuan Cuong's opinion, Mr. Nguyen Ton Quyen cited the expected increase in export tax on chips from 2% to 5%, after the Vietnam Timber and Forest Products Association commented and proposed. production should not be applied because it will greatly affect the producers, most of which are afforestation households. The Minister of Agriculture and Rural Development has decided to continue researching and developing a specific roadmap, not increasing it immediately. Or as with the proposal not to apply plant quarantine to imported logs and sawn timber in case the wood batches have been certified for quarantine by exporting countries, the General Department of Customs also said that it would consider applying for an application. simplifying administrative procedures for businesses… In short, the policy mechanism is very open to the wood industry, the key problem lies with the businesses themselves.