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 Viet Nam: Forestry industry aims for US$18bil exports in 2024
[Jan 1, 2024]

HANOI: The forestry industry has set an export target of US$17.5bil to contribute 23 million cubic m of wood from planted forests in 2024.

This aim was revealed by Trieu Van Luc, deputy director of the forestry department under the Agriculture and Rural Development Ministry, at the conference about the sector¡¯s performance last year and to outline development orientations for 2024 last week.

Luc highlighted that the sector would advance the multipurpose value of forest ecosystems and create a sustainable forestry economy through efficient use and management of forest resources.

It would also protect and sustainably develop 100% of the existing forest area, while diversifying production under green, sustainable and circular practices. This effort would be supported by developing collaboration and association structures within the forestry supply chain.

The industry would also strengthen the quality management of forestry plant varieties that contribute to the ecosystem to increase the productivity and output of planted forests, developing large timber production forests.

In 2023, the forestry sector marked a significant milestone when the processes were completed to transfer 10.3 million tonnes of carbon emission reduction to the Forest Carbon Partnership Facility through the World Bank at a unit price of US$5 per tonne of CO2, amounting to US$51.5mil.

The Vietnam Forest Protection and Development Fund recently received the first payment of US$41.2mil from the World Bank and already disbursed the payment to the provinces, making urgent plans to pay forest owners in six provinces.

The department estimated that forest product exports reached US$14.39bil last year, down 15.8% compared to 2022.

This decline was caused by market instability, affected by the Russia-Ukraine conflict and tightening spending in the United States and European Union (EU) markets on non-essential products, including wood.

Moreover, Vietnamese businesses also faced difficulties when the EU added many new regulations such as the carbon border adjustment mechanism, including the wood industry and the EU¡¯s Anti-Deforestation Regulation.

To boost wood and forest product exports in the upcoming time, the industry aims to develop legal sources of wood from planted forests to meet production standards by developing concentrated planted forests and sustainably grown forests.

It also encourages creating conditions for EU suppliers to promote raw materials in Vietnam while controlling imports from high-risk areas.

In addition, a green economy model is being piloted in the wood industry with net-zero commitments.

Along with the EU, many other markets have also set new and strict policies, causing many difficulties for wood export activities. The US market requires an increase in the frequency of investigations applying trade remedies to the industry, and also compliance with labour and employment regulations. Japan also requires Vietnamese wood products to have sustainability certificates.

The German Supply Chain Due Diligence Act is also indirectly impacting Vietnamese exporters. German importers require Vietnamese exporters to provide additional certificates related to product origin, employment status, wages, waste treatment and other related certificates.

Meanwhile, Canada currently tends to put forward more environmental regulations in its product design, manufacturing and marketing strategies. Recently, the Canadian Government published a regulatory framework to establish mandatory requirements for recycled content and labelling for plastic products, which will have some impacts on most of Vietnam's export commodity groups, from consumer goods packaging to other key export sectors.

: thestar.com.my