Pham Van Dien, deputy director general of the Viet Nam Administration of Forestry spoke on the agreement’s implementation in an online dialogue that also addressed challenges and opportunities for the forestry industry. The session was held by the Ministry of Agriculture and Rural Development and Nong thon Ngay nay (Countryside Today) newspaper in Ha Noi on Wednesday.

Dien said the agreement set the stage for Viet Nam to join the global timber market, and that the signing was a recognition of Viet Nam’s commitment to implementing international conventions.

“Joining this agreement, we have been more professional, open and transparent in line with international standards,” said Dien. “This is the key factor in the value of the wood industry moving forward.”

“We have the opportunity to apply advanced technologies in the processing industry, creating more eye-catching and valuable wood products,” he said. “For example, normal wood products cost US$1,400-$1,800 per square metre, but it will be up to $4,000 if we apply these technologies.”

Dien said the industry would have to perfect the legal system and collect both local and foreign ideas in a mutually beneficial manner. Each locality needed the support of farmers to promote afforestation and sustainable production.

The agreement was signed in Brussels on the sidelines of the 12th Asia-Europe Meeting Summit on October 19. It covers all timber exports to the EU, with five specific products defined in the FLEGT Regulation of 2015 – logs, sawn timber, railway sleepers, plywood and veneer – as well as a number of other products such as woodchips, parquet flooring, particle boards and wooden furniture.

The core of the deal is the Viet Nam Timber Legality Assurance System (VNTLAS), which ensures that wood and timber products exported from Viet Nam to the EU have legal origins.

Viet Nam is hoping to become a hub of manufacturing and trade of branded timber products in the next 10 years, aiming for an export value of $10-18 billion by 2025.

To reach this target, there is much work to be done.

According to Vice Chairman and General Secretary of Vietnam Timber and Forest Product Association (VIFORES) Nguyen Ton Quyen, EU is considered a very important market for Vietnamese timber products. FLEGT-VPA will help Viet Nam export directly to 28 European countries without having to go through intermediary countries.

Quyen said the market would grow. In a few years, wood export value to the EU would grow from $700 million today to more than $1 billion.

“More importantly, the agreement will help Viet Nam improve its institutional arrangements for forest management, addressing illegal exploitation and trade and contributing to the sustainable development of the wood processing industry,” said Quyen.

Quyen said that under the agreement, timber exported to the EU must be legal. Although enterprises use domestic raw materials or imported timber, they still had to provide documents to prove the legality of their timber.

In addition to these benefits, the agreement also details Viet Nam’s obligations.

Nguyen Tuong Van, Deputy Director of the Viet Nam Administration of Forestry’s Department of Science, Technology and International Cooperation, said the agreement required Viet Nam to amend and supplement some legal documents.

“The agreement also requires people and enterprises participating in the supply chain to implement self-declaration and self-assessment and to archive dossiers during the production in accordance with the law,” said Van.

She said it also demanded regular high-ranking dialogues between Viet Nam and the EU, with the participation of relevant associations and local NGOs, to ensure the agreement was being implemented in a transparent manner.

The FLEGT-VPA was signed after six years of negotiations. It is expected to open up opportunities for Viet Nam to develop its timber industry and exports.

According to a report from the Viet Nam Administration of Forestry, the forestry sector had made remarkable progress in recent years. Forestry value increased an average of 6.75 per cent each year between 2013 and 2016. Forest cover reached 41.45 per cent in 2017.

Wood products are Viet Nam’s sixth most important export commodity and have seen high growth over the past decade. Last year, export turnover reached over $8 billion. In the first 10 months of 2018, the export of timber products reached an estimated $7.6 billion.

The EU is the fourth largest market for Viet Nam’s timber, accounting for more than 10 per cent of exports. At least 400 firms export to the EU.

Negotiations on the agreement started in October 2010. Over six years, the two sides conducted 11 high-ranking talks, 19 technical negotiations and dozens of online sessions and consultation seminars. — VNS