A preliminary survey by the Handicraft and Wood Industry Association of Ho Chi Minh City (HAWA) found that export orders of enterprises in the industry decreased by 30% at the start of the year, but began to recover in July ahead of the global year-end furniture shopping season. (Photo: VNA) The volatility and unpredictability in global markets may havecaused challenges for many industries, including woodworking, but offeredopportunities to agile businesses, experts said at the forum.
The Department of Forestry reported that forestry product exportsamounted to an estimated 6.42 billion USD in the first six months of the year,a 28.8% year-on-year decrease, with wood and wood product exports dropping by29% to 5.96 billion USD.
A preliminary survey by the Handicraft and Wood IndustryAssociation of Ho Chi Minh City (HAWA) found that export orders of enterprisesin the industry decreased by 30% at the start of the year, but began to recoverin July ahead of the global year-end furniture shopping season.
Speaking at the Vietnam Wood and Furniture Industry Forum held byHAWA in HCM City last week, Pham Phu Ngoc Trai, Chairman of Global IntegrationBusiness Consultants, said the current reduction in export orders is temporaryand the furniture industry has considerable growth potential for the next fiveto ten years.
Compared to global GDP that is forecasted to growth by 3% thisyear, the world furniture industry's compounded growth rate stands at 4.5%.
According to Statista Market Insights, the world furniture marketrevenue may reach 766 billion USD in 2023 and is estimated to hit approximately932 billion USD in 2027, he said.
Vietnam ranks among the world's five largest wooden furnitureexporters, underlining its solid internal resources, he added.
HAWA Chairman Nguyen Quoc Khanh has a similar view, stating thatwoodworking firms showcased their business integration initiative. Duringmarket downturns, businesses remained proactive by reorganising production andstreamlining operations to reduce costs while also seeking support from tradepromotion agencies to explore new markets.
Khanh pointed out a new trend in the woodworking industry, wheresignificant furniture brands from Vietnam are expanding into promising exportmarkets, notably super-rich countries in the Middle East such as Saudi Arabiaand Dubai with an eye on supplying products to new super real estate projectsthere.
With the industry's internal strength and the return of orders,the industry's export target for 2023 is considered attainable, he said.
Experts at the forum emphasised the importance of businessesstrengthening their internal resources to be prepared for order resumptions inthe recovering market and embracing green transformation to improvecompetitiveness.
Sustainability in interior products is now a mandatoryrequirement, not just a voluntary standard, Trai said.
He said Vietnamese businesses will face new demands such as theEU's Carbon Border Adjustment Mechanism (CBAM), effective from October 2023.
Goods imported into the European market may incur additional costsif they fail to adopt a lower-emission production model and earn carboncredits.
Vietnam's wood industry possesses significant reserves of plantedforests, which, if well-managed and connected, offer opportunities forVietnamese furniture enterprises to capitalize on the carbon credit market, hesaid.
The woodworking industry should reposition its goals and vision tobecome the world's green and sustainable furniture hub, he added.
Pham Thi Ngoc Thuy, Director of the Private Economic DevelopmentResearch Board, pointed out that market challenges related to the EuropeanUnion Timber Regulation (EUTR) and net-zero goal will push Vietnam's wood andforest product processing industry in a more positive direction, encouragingfurther outreach and attracting foreign investment./.
VNA
