In 2010, provincial woodwork industry has continued to gain positive results and still taken the lead among key export industries of the province. But, according to businesses, the industry now faces a lot of challenges, especially the high increase of the material prices and lending interest rates.

 

Woodwork export further going up

 

As of late Oct. 2010, the province’s woodwork export turnover reached US$1,050.2mln, increasing by 8.6% compared to last year’s same period and accounting for 16.1% of the province’s total export value. Some businesses, namely Truong Thanh, Hiep Long, Tieng Trien, Tran Duc, Minh Duong…, gained high growth in export turnover.

 

 

Woodwork industry always takes lead among key export industries of Binh Duong province

 

According to provincial Department of Industry and Trade, it is sure that the province’s woodwork turnover in 2010 will achieve more than VND1.2bln. Main markets of province-based woodwork businesses are still Japan, North America, Europe. From the above result, according to Binh Duong provincial Furniture Association (BIFA), the province’s woodwork industry has gradually showed signs of recovery compared to its performance in late 2008 and early 2009.

 

According to the assessment of Nguyen Ton Quyen, chairman of the Viet Nam Timber and Forest Product Association, that Binh Duong is a locality with the woodwork industry that takes the lead in the country about the number of businesses and export turnover. Currently, Binh Duong lures more than 500 woodwork businesses, accounting for around 25% of the number of businesses and 40% of total export turnover of the whole country.

 

But, there are still challenges

 

BIFA said that the above results came from the efforts of the local woodwork businesses in expanding new markets, investing state-of-the-art technologies, diversifying product patterns, especially making reasonable strategies in production-trade activities. Noticeably, the province’s woodwork export industry has moved in the right direction. The province’s woodwork products have directly been exported to countries that have the real demand.

 

However, the local woodwork industry’s biggest challenge is that the price of woodwork materials is too high. The price of woodwork materials now accounts for 60%-70% of the price of finished products. Meanwhile, 80% of woodwork materials used by province-based businesses must still be imported. In 2010, the sudden increase of the imported woodwork materials has hindered many businesses.

 

Vo Truong Thang, General Director of Truong Thanh Woodwork Corporation said the lending interest rates at 12-14% are too high, which make businesses find it difficult to compete with neighboring countries having interest rates below 5%. Besides, there are many other obstacles for changes, including the instability of workforce, the lack of cooperation in selling price among businesses…

 

According to BIFA, removing current obstacles to increase competitive advantages for the local woodwork industry is a deed that needs to be realized. The local woodwork businesses also want that the Government will soon adjust the export tax to stabilize material prices. For better development, the local woodwork businesses also need to continuously give training to their workforce; work harder on designing new products to lure more customers; pay more attention to improving production technologies and product quality…

 

Reported by Trong Minh-Translated by K.T