1. HIỆP HỘI GỖ LÂM SẢN VIỆT NAM REPORT VIETNAM TIMBER PROCESSING INDUSTRY THE MAIN CONCERNS Vietnam Timber and Forest Product Association NGUYỄN TÔN QUYỀN Vice Chairman and Chief Secretary

2. I. OVERVIEW OF VIETNAMESE FOREST RESOURCE 1.Forestry area In 2008 : 13.118.773ha (Natural forest: 10.348.591 ha, Man made forest: 2.770.182 ha. Coverage 38,7%). (Figure 1: Statistics of forestry area by time) 2. Forestry exploitation 2009: 3,88 mil m3 (man made forestry: 3,7 triệu m3); Reduction of natural forestry exploitation (1990: 1 mil m3; 2004: 200.000 m3; 2008:155.000 m3). 3. Afforest development  Man made forestry area has increase from year to year (2009: 246.891 ha increase of 105% comparing 2008);  The rate of afforestation increases dramatically in North East and Middle areas  (Firgure 2: Result of afforest till 2008 categorized by areas) (Firgure 2: Result of afforest till 2008 categorized by areas) 4. Availability of land  Forestry strategy: 8,4 mil ha commercial forestry (natural forestry: 4 mil ha) to 2020;  2008: 2,7 mil ha commercial forestry;

3. II. INTERNAL RESOURCES Total demand of Timber and wood industry of Vietnam  Trade turnover for exporting wooden products expected 2010: 3 billion USD; wood materials needed: 6,4 million m3; available wood material: 1,6 million m3.  Trade turnover for exporting wooden products expected 2015: 4.5 billion USD; wood materials needed: 10,1 million m3; available wood material: 5 million m3.  Trade turnover for exporting wooden products expected 2020: 7 billion USD; wood materials needed: 16,1 million m3; available wood material: 12 million m3.  we have to import from 4 to 4 million m3 of wood material per year from 2010 to 2020  Natural forest exploitation for a large amount of 5 million m3 per year for the demand of producing paper …

4. III. Wood Processing Industry–The main concerns 1. The development of businesses in Wood processing industry From 2000-2007, total numbers of business increase by 2.83 times (North area: 1.42 times, South area: 3,74 times) Firgure 3: The development of busineses (2000-2007) 2. Distribution of businesses by economic areas  2007, the proportion not equally: South East area 59%, Mekong Delta area, Red river area, Middle North area, West area: 7,32%; North West area: 1%. 3. Distribution of businesses by economic structure  2000 - 2007: Public businesses reduced from 40% to 5%, private organizations increase from 57% to 93%; Joint-ventures remain unchanged (2->3%). 4. Foreign invested businesses  2008: 26 countries interested to invest to wood processing industry of Vietnam (421 businesses accounted for 17%). (Taiwan 183; Korea: 38; England: 29; Japan: 27;…).

5. III. Wood Processing Industry–The main concerns 5. Exporting wooden products from Vietnam  Main export markets: U.S. (44%); EU ( 29%); Japan (10%); China (5%); Australia (3%); Korea (3%); Taiwan (1%).  Exporting turnover of Vietnamese wooden products increase from 1,102 billion USD (2004) to 2,779 billion. USD (2008), 2,5 times greater within 4 year. Comparing between 2008 and 2000, the increasing rate is 8,9 times. The main concerns Policies and regulation Building the brand image Dependant on source of import timber material Legal timber material for export products Wood processing industry advancement not match to market demands FSC &CoC certificate issuance is slow Skill labor shortage Inadequate attention to domestic market Timber trading information is lacking, out dated, and unanalyzed

6. IV. PROPOSED SOLUTIONS General Solution Fixing the policies and regulations which are exposed the imperfection after world recession Enhance the Vietnamese businesses and wooden products competiveness Reduce the dependency upon imported timber materials Establish the information center to provide information to Vietnamese Timber Industry in exact and timely manner

7. Ổn định diện tích rừng trồng SX 3 triệu ha (2010), 4 triệu ha (2020) IV. PROPOSED SOLUTIONS Specific solutions Review the legal process and procedures Facilitate forestry certification issuance for 900.000 forest area creating favorable condition for acquiring FSC FM certificates Stabilize the forested areas of 3 mil ha (2010) and 4 mil ha (2020) Set up the national action plan to manage the supply chain and development of FSC – CoC certification Concrete plan to implement forestry strategy Enhance knowledge and skill on FSC - Coc Facilitate the creation of consultative organization regarding supply chain and FSC –CoC assession Cooperate with international certification organization Cooperate with Exporting Timber countries to Vietnam to facilitate the import and ensure the legal matter Make up the national plan regarding FLEGT, DDR, LACEY Conclude voluntary partnership with EU, establish licensing authority in Vietnam Creating information channel to exchange with other parties regarding FLEGT, LACEY Exploit forestry resource: 100.000 ha (2010-2015); 150.000 - 180.000 ha (2015- 2020); 200.000 – 220.00 ha (2021) Promote awareness of role, position and enhance operating capacity of Association

8. THANK YOU Vietnam Timber and Forest Product Association