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| Viet Nam ranks top in Southeast Asia and second in Asia, after China, in terms of wood product exports.— Photo thesaigontimes.vn
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HA NOI (BizHub) — The country's wood exports enjoyed an impressive turnover in the first nine months of the year, bringing in US$2.6 billion, but local enterprises were left in the shade by firms backed by foreign direct investment.
According to Customs of Viet Nam figures, wood product exports reached over $305 million in September, outstripping rice and coffee. The country ranks top in Southeast Asia and second in Asia, after China, in terms of wood product exports.
However, local wood companies are losing out in the competition with FDI enterprises. Of this year's total turnover, FDI enterprises made up $1.67 billion, around 64 per cent, while domestic firms continued to lose ground.
It's been reported that FDI enterprises from Taiwan, the US and UK have been working to full capacity to meet the deluge of orders they've received.
Vo Truong Thanh, general director of Truong Thanh Furniture Corporation - one of the biggest local wood processing businesses - said he had missed out on hundreds of export contracts worth over $50 million as the company lacked the finances to undertake big orders.
In light of the economic downturn, Thanh said he had been unable to take out loans from banks to access the funds.
"The larger financial resources and management capabilities of FDI firms are seen as one of the key reasons for their success," said Thanh. "Their contacts and distribution systems in major markets give them a greater advantage."
In spite of the difficulties, chairman of Binh Duong Wood Export Association Huynh Quang Thanh still believed there were opportunities as "exports are much better now with more orders from the United States, Japan and Europe."
He felt local enterprises should now update their technology and restructure to be able to process big orders in the future.—VNS