Timely remove difficulties to enable forest product enterprises to catch up the market bounce back

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Difficulties pile up

Speaking at the conference the Prime Minister worked with the Wood and Forest Products Association, the Vietnam Association of Seafood Exporters and Producers to remove difficulties and promote the production and export of forest and aquatic products, on April 13, 2023, Mr. Do Xuan Lap, Chairman of VIFOREST said that the forest product sector decreased in both output and export value.

In the first quarter of 2023, the export of wood and forest products reached US$3.1 billion, down 28.3%. It is expected that in 2023, the value of export turnover will only reach the same level as in 2022. Along with a sharp decrease in the number of orders, enterprises have to produce in moderation, greatly affecting production and business and life of nearly ten million workers.

Given market difficulties, VIFOREST has suggested that local timber enterprises and associations actively seek, expand markets and improve competitiveness; they should focus on the criteria of reasonable price, suitable for tastes, well qualified products with good after-sales policies.

It is necessary to restructure and reorganize production, focus on changing technology, perfect the production management system, improve the efficiency and quality of human resources. On the other hand, enterprises should step up the production of products using domestic raw materials to reduce costs and improve the competitiveness of products.

VIFOREST also recommends that ministries, sectors and localities give priority to supporting enterprises in the wood and forest product processing industries, in trade promotion and market expansion through the negotiation and signing of trade agreements such as: China East, South America. At the same time, there should be policies to support clusters, concentrated industrial zones of wood and forest product processing industries in potential regions and localities; establish an international trade center of great stature and scale; invest in supporting industry development and develop domestic concentrated plantation material areas as well as offer supporting policies on taxes, insurance, and credit to facilitate businesses in the current difficult time.

In addition, VIFOREST proposes to the Prime Minister, ministries, branches and localities to soon allow the establishment of special regional and international exhibition centers such as Hanoi and Da Nang (currently not available) to promote product trade; change the level of support in the trade promotion support policy for Vietnamese enterprises to participate in international fairs, due to the inadequate current support.

As for the value-added tax refund when exporting wood and wood products, the Ministry of Finance is currently considering the export wood industry as a risky industry in tax refund due to value added fraudulence in exports. The association proposed the Prime Minister and the Ministry of Finance to consider and strictly handle violations of enterprises. At the same time, there is a plan to solve and create conditions for timely value-added tax refund for genuine production and business enterprises,” said Do Xuan Lap.

It is expected that in 2023, the export value will only be equivalent to 2022. Photo: Nguyen Thanh
It is expected that in 2023, the export value will only be equivalent to 2022. Photo: Nguyen Thanh

Quickly remove difficulties for businesses

With the current difficult export situation, VIFOREST proposes debt due for enterprises in the wood and forest product processing industry from 6 to 12 months; implement a special credit package from the Bank for Social Policies for enterprises to pay wages to workers in 2023; may delay the payment of social insurance, without interest in 2023.

Dealing with difficulties shared by the association, Prime Minister Pham Minh Chinh asked ministries, branches and localities to share and support businesses in a real and timely manner. Relevant stakeholders will make efforts to promote the spirit of self-reliance, self-reliance and self-reliance to overcome difficulties and overcome challenges and achieve the goal of exporting forest products of USD17.5 billion.

In particular, the Prime Minister noted the Ministry of Agriculture and Rural Development to build, complete and submit to the Government for promulgation a number of mechanisms and policies on forestry and fishery, including Vietnamese legal timber assurance system regulations; effectively implement the provisions of law on management and traceability of forest and aquatic products.

The Prime Minister also assigned the Ministry of Finance to assume the prime responsibility for studying policies and removing tax issues, submit to competent authorities for consideration and implementation of solutions on exemption, reduction, extension, postponement, extension of taxes, fees, charges, land rent and land use levy applicable to 2023.

The Prime Minister requested the State Bank of Vietnam to administer lending policies for banks, provide capital, reduce costs, and reduce loan interest rates to support export enterprises; directing credit to production and business.

The Central Bank should maintain the policy of supporting 2% interest rate for enterprises, cooperatives and business households in the field of agriculture – forestry – fishery according to Decree No. 31/2022/ND-CP of the Government; urgently research, propose competent authorities and deploy appropriate solutions on debt restructuring, interest rate exemption and reduction, debt extension.

According to the report of the Ministry of Agriculture and Rural Development, in 2022, the export of wood and forest products was estimated at 17.1 billion USD, exceeding 3.8% of the plan; This industry also sets an export target of 17.5 billion USD in 2023. Seafood export turnover in 2022 reached 11 billion USD, up 23.8% over the same period in 2021 and 22.2% higher than the plan (9 billion USD), the highest ever; The industry’s target in 2023 is about 10 billion USD.

However, accumulated in the first 3 months of 2023, the total export and import turnover of agricultural-forestry-fishery products was estimated at US$ 20.63 billion, down 11.2% over the same period last year. In which, it was recorded that the export turnover was at 11.19 billion USD, down 14.4%; import was at 9.44 billion USD, down 7.2%; trade surplus of 1.76 billion USD, down 39.6% over the same period in 2022.

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