The three largest markets out of the 120 export markets for Vietnamese wooden products during the first five months were the United States, Japan, and China, accounting for 65.3 per cent of the total export value. — Photo VOH

HA NOI (Biz Hub) — Viet Nam gained growth in the export value of wood in the first five months of this year, raising expectations of reaching the yearly export value target in this field.

According to the Ministry of Agriculture and Rural Development, the export value of wooden products recorded a year-on-year increase of 6.9 per cent to US$2.56 billion in the first five months.

The three largest markets out of the 120 export markets for Vietnamese wooden products during the first five months were the United States, Japan, and China, accounting for 65.3 per cent of the total export value.

South Korea was the fifth largest market, after the European Union at the fourth place, said the ministry, adding that the free trade agreement between Viet Nam and South Korea will create more favourable conditions for local wooden products to enter their markets.

After the signing of the agreement, Viet Nam's wooden products will enjoy zero export tax to the South Korean market instead of the 3-6 per cent tax rate before the agreement.

The ministry said that the local wood production industry enjoyed some advantages during the first five months of the year because Europe had reduced the production of wood products and an anti-dumping tax had been imposed on China's wooden products exported to the United States, according to the Thoi bao Kinh te Viet Nam (Viet Nam Economic Times) newspaper.

In the first five months of this year, the percentage of the foreign direct investment enterprises' wooden products' export value reduced from 80 per cent to 60 per cent, while the percentage of export value for local wood producers increased from 20 per cent to 40 per cent.

Local enterprises saw an increase in the export value of wooden products because in recent years, local enterprises had adopted the modern production technology of foreign countries such as Italy and the United States, Huynh Quang Thanh, chairman of the Binh Duong Wood Association, was quoted as saying by Viet Nam Television (VTV).

The national export value of wooden products is expected to continue its growth till this year end as local enterprises have bagged large export orders for wooden products, said Tran Quoc Manh, a member of the Handicraft and Wood Industry Association of HCM City's executive board.

Therefore, the wood processing industry is believed to meet its total target export value of $7 billion for this year, Manh added.

However, many experts noted that in coming time, Vietnamese export wooden products will face high competition from other countries. The high production cost of wooden products, including high transport costs, will be a challenge for local wood producers in improving their competitive ability. — VNS