Sggpnews – he wood industry of Binh Duong Province accounts for up to 50 percent of the country’s total wood export value. In the past months, the Covid-19 pandemic has affected significantly the production and export of wood of enterprises in the province, forcing them to promote market expansion and online selling.
Wood processing at a company in My Phuoc Industrial Park in Binh Duong Province. (Photo: SGGP)At the beginning of this year, many experts said that the wood industry of Binh Duong Province would continue to make breakthroughs and might help the country’s wood export value to hit US$12.5 billion but the pandemic has hindered enterprises. Port closure in some countries has made production curtailed with many enterprises temporarily halting operations to wait for the pandemic to end to ensure the health and safety of their workers.
According to the Chairman of the Binh Duong Furniture Association (BIFA), Mr. Dien Quang Hiep, the province has 1,600 enterprises operating in the wood industry, accounting for 40 percent of the total number of timber enterprises across the country. In January and February this year, the export value of enterprises posted growth but since the beginning of March to now, the Covid-19 outbreak has caused 30 percent of enterprises to temporarily pause their operations. Enterprises that received orders to export to the US, Denmark, and countries in the EU also produce perfunctorily to wait for signals to resume export when the disease is controlled from their partners. Along with a forecast of a short-term decline in orders, the wood industry will be unlikely to achieve an export value target of $12.5 billion in the remaining months of this year.
Mr. Huynh Quang Thanh, CEO of Hiep Long Company, said that his company exports products to many countries so it does not depend on any market. Currently, his company still exports its products according to the plan to Japan and the Middle East with a large value, which is the basis for a 15-percent pay rise at this time. The only impact is that some female workers quit their jobs to stay home to take care of their children due to school closure so the company has to calculate appropriate overtime to ensure production progress.
Mr. Dien Quang Hiep said that online trading is an indispensable trend in the world amid the context of the complicated pandemic. The business community of the timber industry in Binh Duong Province is one or two years behind other countries but at present, enterprises have been cooperating with large e-commerce platforms in the world, namely Alibaba and Amazon. Currently, the BIFA support enterprises by continuously opening training courses on online trading for its member enterprises and received a great response of enterprises. Transactions via e-commerce channel currently account for more than 50 percent of the total number of orders of enterprises in the province.
According to the People’s Committee of Binh Duong Province, in the first quarter of this year, most enterprises have been proactive in the sources of raw materials for production by the end of March this year to fulfill the contracts signed since the beginning of this year. Some enterprises have signed contracts with their traditional customers until the second quarter of this year. For instance, Hiep Long Company has exported more than $3 million worth of products from the beginning of this year, an increase of around 5 percent over the same period last year.
Besides solutions to overcome difficulties of enterprises, the BIFA also proposed several measures to resolve difficulties and speed up production, including policies to reduce land tax, and corporate income tax; proposing commercial banks to lower interest rates to 2 percent and extend debts; temporarily halting payment of insurance premiums, including social insurance and unemployment insurance, and encouraging workers to take unpaid leave to share difficulties with enterprises when production must be temporarily halted.