Vietnam plastics export turnover to increase by 15%
In this article (5)
Exports of plastics are expected to grow by 12–15 per cent this year, according to the Việt Nam Plastics Association (VPA).
Hồ Đức Lam, chairman of the association, said the country’s key export markets this year would be Japan and the US, which has high demand.
Other markets such as China, Laos, Cambodia and Myanmar are expected to become new export markets for plastics in the future.
Plastic bags made in Việt Nam are still subject to anti-dumping taxes in the US market, but the US imposition of anti-dumping duties has had almost no impact on exports of the sector, according to Lam.
Every year, the average US import turnover is more than US$50 billion for plastics and plastic products, accounting for 9.1 per cent of the world’s total import of plastics, according to VPA.
The largest plastic export market is Japan, with an average growth rate of 20–25 per cent per year. Việt Nam now ranks sixth in the top 10 countries exporting plastics to Japan, which is one of the most difficult markets with many strict regulations on the quality of goods. Vietnamese plastic exporters have been urged to improve quality, design and trade promotions to enter this market.
In addition, the EU’s demand for plastic products imported from Việt Nam is high, especially plastic pipes.
Việt Nam’s plastic products are not subject to anti-dumping duties in the EU markets like other Asian countries (the average tax rate is from 8-30 per cent). Thus, Vietnamese producers are also urged to seek new export markets.
Despite the high export prospects and strong development in recent years, the plastics industry is still known only as part of the plastic processing industry.
More than 80 per cent of raw materials are still imported from other countries.
Each year, the plastic industry needs an average of four million tonnes of raw materials, but only manages to produce about 900,000 tonnes, with the rest imported.
Experts have said that a shortage of raw materials will reduce the competitiveness of exporters.
Because of regulations on the origin of goods, it is difficult to take advantage of tax incentives in free trade agreements.
Exporters also need to focus on environmentally-friendly and safe products for sustainable growth.
Việt Nam’s plastics industry earned $3 billion last year, posting a 17.3 per cent increase over 2016, according to VPA.
Questions & Answers
Q.What percentage of raw materials for Vietnam's plastics industry are imported?
What percentage of raw materials for Vietnam's plastics industry are imported?
More than 80 per cent of the raw materials for the plastics industry are imported from other countries. The industry needs four million tonnes annually but only produces about 900,000 tonnes.
Q.Which export markets are currently key for Vietnamese plastics?
Which export markets are currently key for Vietnamese plastics?
Japan and the US are the country's key export markets this year due to high demand. The US alone accounts for 9.1 per cent of the world's total plastic imports.
Q.What is the primary challenge facing Vietnamese plastic exporters?
What is the primary challenge facing Vietnamese plastic exporters?
A significant shortage of raw materials is a major challenge, as over 80 per cent are imported. This reliance on imports can reduce the competitiveness of exporters.
Q.Why is the EU market considered favourable for Vietnamese plastic products?
Why is the EU market considered favourable for Vietnamese plastic products?
Vietnamese plastic products are not subject to anti-dumping duties in the EU markets, unlike those from other Asian countries. This offers a competitive advantage for products like plastic pipes.