7.1. Wood processing industries
7.2. Pulp and paper industries
Following the new policies of the government on investment and business development' the number of enterprises run following the laws regulating Foreign Investments, the Company Law, the Private Enterprise Law in Vietnam has increased. By now, there exist in this country some 290 wood processing industries of these categories, of which:
· Enterprises run following Foreign Investment Act amount to 30;
· Those run by the Company Law and the Private Enterprise Law to 60.
· Those owned by the State and run by the various ministries and central agencies to over 60; and
· State-owned enterprises ran by provincial agencies/authorities amount to about 140.
These enterprise can be found everywhere over the country, but as a rule they are concentrated mainly in Ho Chi Minh and Hanoi cities and in their neighbouring areas.
Besides, there are thousands of saw-pits being established everywhere over the country but mainly in the North, and providing saws timber for construction and the making of furniture and other commodities to people living in the countryside.
Altogether they have a low capacity of not over 3 million cu.m. of round and solid wood annually. Their equipment is obsolete and even used up. Causing wood and timber materials to be wasted, the end products to be under-graded not meeting the demands and preferences of customers in a fluctuating market. Enterprises run following the Foreign Investment Law, the Company and the Private Enterprise Laws seem to function better, but generally speaking the situation still remains inadequate for efficient competition at market places, in particular the international ones. The annual production of the above mentioned enterprises is reported to reach: 800,000 cum. of saw timber 1,000,000 sq.m of veneer, 10,000 cum. of plywood, over 30,000 m3 of particle board.
Facing the current shrinkage of forested area, the Government of Vietnam has decided to limit timber extraction from natural forests, to ban the export of round and semi-processed timber, so to posh entrepreneurs and enterprises to the manufacturing of high-valued products. So despite a decrease in annual round wood removal from 927,000 cu.m. in 1991 to 310,000 cu.m. in 1995 export earnings from forest products after a gradual but temporary fall from US$ 175,5 m in 1991 to 97.5 in 1993 have regained their ascension to US$ 121.5 m in 1994, then to US$ 135.6 m in 1995: earnings from cabinet-work have gained most rapid ascent, from US$ 1 m in 1996 to US$ 65m in 1995.
Besides the limitations mentioned above, the Government is considering to close access to natural forests for timber extraction, Thus, raw materials for wood-based industries will have to be extracted from plantations, which creates a lot of restraints for a smooth running of all enterprises dealing with wood working and processing. They have to remodel their factories and equipment, to change technologies and solve a wide range of technical and product marketing problems. Towards the year 2010, manufactured forest products will have to come from raw materials of manmade forest. Products and commodities such as plywood, particle boards, fibre boards will prevail, and art articles using low amount of wood as raw materials will go developing. The use of timber in the construction and building industries will experience big changes as wood is going to be replaced by other materials.
Pulp and paper industries are under the management of the Ministry of industries. As the consumption of paper and its products in Vietnam is very low as compared to other countries of the region (not above 2 kg per person on the average), paper production recently has gone increasing very quickly from 97,000 tons in 1990 to 145,000 tons in 1994, with an average rate of 13%, to meet the increasing demand in paper for economic development. To provide the supply of raw materials to the industries, besides the materials removed from national forests, it has found necessary to import hundred thousands of tons of paper pulp.
Towards the year 2010, paper industries are going to develop very quickly, so to reach the target of 1,000,000 tons of paper in the year 2010 and manage large tracts of forest plantations for the production of pulp.
It seems that national financial resources are inadequate for building and management for a large number of paper mills. For that development needs more investments from foreign countries and joint ventures.
