DongNai: Web portal

https://dongnai.gov.vn

Handicrafts: Severe competition on export

There used to be quite a time when export turnover of handicrafts reached up to 1.6 billion USD. Vietnamese handicraft products were popular with many markets for a long time. However, over the last few years, export turnover of this industry has been reduced significantly, many orders fell into the hands of enterprises from other countries in the region.


10102017-6-1.jpg
 Production of decorative lights at the factory of Green Leaf Company Limited (located in Ho Nai Industrial Zone, Trang Bom district)
 

 One inherent disadvantage is the lack of creativity, which has long been recognized by the Vietnam Handicraft Exporters Association (Vietcraft) but still yet to be resolved.

No breakthrough designs.


At a recent conference on the development of handicrafts in Ho Chi Minh City, Vietcraft has frankly acknowledged that handicraft products of Vietnam are outdated and not creative in terms of designs and diversity compared to the global trend, which leads to lower value of orders. The products are made by traditional experience and the models do not have breakthrough designs. This is the cause of the problem, making it impossible for the industry to develop. This issue is also addressed by many enterprises specialized in making handicrafts.

 
Mr. Nguyen Duc Tuan Hai, Director of Leaf Green Co., Ltd (headquartered in Tan Phong ward, Bien Hoa city), said handicrafts are very adaptable to changes in design. This is an important point to help businesses improve their competitiveness in the market, for example, Leaf Green company specializes in the production of bedside lamps for export, products of fine arts and crafts, since the body of lights and decorative items are made from wood, pottery, rattan, bamboo, hyacinth and coconuts ... His products are available in most major markets, such as America, Europe, North America and Middle East. "I notice that bedside lamps follow fashion trend every season. I always try to see what the new fashion trend is, then choose materials and designs," said Mr. Hai. Export turnover of his company has grown quite well in recent years: in 2015 it only reached 9 billion, but in 2016 it reached the milestone of 1 million (over 22 billion). And this year, Mr. Hai estimates that sales will well exceed $ 1 million.

 
Mr. Vong Khieng, General Secretary of the Association of Fine Arts Dong Nai, said that the reason why businesses are weak in design is that small businesses do not have enough capital to invest much in this stage, and cannot compete with other enterprises from other countries in the region. Turnover decreases, businesses have to cut costs and investment in creativity, which reduces competitiveness, thereby creating a vicious cycle.

 
Expectations on European market

 

Bui Thi Thanh An, Deputy Director of the Trade Promotion Department under the Ministry of Industry and Trade, said that the wood and handicrafts sector in the European market will be promising in 2018. It is forecasted that the sector will grow better thanks to the promotion of market-building activities in the European Union. In addition, the Vietnam - EU Free Trade Agreement (EVFTA), effective in 2018, will also have a positive impact. Nicolas Audier, Vice President of the European Chamber of Commerce in Vietnam (EuroCham), added that when EVFTA comes into effect, handicrafts and furniture exports from Vietnam to the EU will enjoy 0%tax. At present, some products are subject to high tax rates, particularly 5.6% on bamboo or rattan furniture and 3% on wooden decorations.
 

According to Dong Nai Import Export Association,  the European market is leading the import of handicrafts in Vietnam. Only the export turnover of rattan, bamboo and leave products to this market reached more than 95 million USD in 2016.
 

According to statistics from the General Department of Customs, while the export turnover of rattan, bamboo and sedge products to the US market for the first 7 months of 2017 decreased by about 10% over the same period in 2016, , the export turnover of such products has increased by 12-46% in many countries of EU market such as France, Netherlands and Belgium over the same period. This is a good signal and is expected to offset the decline in the US market.
 
Vân Nam
 

 

You did not use the site, Click here to remain logged. Timeout: 60 second