HCM City(VNS/VNA) - Foreign direct investment in the wood processing industry hasincreased rapidly, especially since 2018, the Vietnam Timber and Forest ProductAssociation has said.

In the first nine months of the year foreign investors had registered toinvest the same amount as in the whole of 2018, it quoted the Ministry ofPlanning and Investment's Foreign Investment Agency as saying.

A report on foreign direct investment in the wood processing industry by To XuanPhuc of Forest Trends, Cao Thi Cam of VIFORES, and Tran Le Huy of ForestProduct Association of Binh Dinh showed that FDI projects have been and wouldcontinue to be an integral part of the wood processing industry.

“Last year 529 foreign enterprises were directly involved in exports worthnearly 3.96 billion USD, or 46.7 percent of the industry’s exports.

“In the first nine months of 2019, the number of foreign enterprises directlyparticipating in exports increased to 565, with their exports being worthnearly 3.4 billion USD.

“Besides, many other foreign enterprises are now providing materials toprocessing enterprises and providing logistics services and other types ofservices.”

Low labour costs, easy access to raw materials, favourable infrastructure, andpreferential tariffs due to free trade agreements the country has signed areamong factors that make the industry attractive to foreign investors, it said.

The US-China trade war could create new opportunities for foreign investment inthe industry, it added.

Dien Quang Hiep, Chairman of the Binh Duong Furniture Association, said foreigninvestment in the industry, especially in the context of the trade war, is alsocausing concern, especially about origin fraud.

In addition to the Government’s efforts, the industry association must alsoproactively detect origin frauds to notify authorities, he said.

In addition to encouraging foreign investment in the wood processing industry,there should also be policies to encourage the development of local companies,he added.

Cao Chi Cong, deputy director general of the Vietnam Administration ofForestry, said wood and forest product exports are expected to meet theGovernment’s target of 11 billion USD this year.

“Vietnamese wood products are available in over 120 countries and territories.The country is the largest exporter in Southeast Asia, second largest in Asiaand fifth largest in the world. This is a very proud achievement.”/.