The United States is the most important export market for Vietnam's wood industry. Therefore, the policies of US President-elect Donald Trump in the coming time will create both opportunities and challenges for the wood industry.
In the first 11 months of 2024, the surplus of wood and wood products in Vietnam reached 12.11 billion USD. Although bringing great value, the Vietnamese wood industry is also facing strong changes in policies of export markets, especially from the United States.
Big impact from new US policies
Mr. Do Xuan Lap, Chairman of the Vietnam Timber and Forest Products Association, said that it is forecasted that in 2024, Vietnam's wood and wood product exports will reach over 16.2 billion USD, of which exports to the United States will account for 56% of total export turnover, reaching nearly 9 billion USD and imports from this market will reach over 230 million USD.
Thus, in the US market alone, the Vietnamese wood industry had a trade surplus of about 8.8 billion USD in wood and product import and export activities, which shows that the US is the main and most important market of the Vietnamese wood industry.
According to Mr. Do Xuan Lap, the United States will likely have major changes in the coming time with the policies of US President-elect Donald Trump. These changes may be created due to the new tax policy applied by the US Government to imported goods into this market in the future, the expected tax rate will be 60% for all imported goods from China and 15-20% for imported goods from other countries.
“Vietnam’s wood industry may benefit from the high tariffs imposed by the United States on goods from China, but it may also suffer negative impacts. The United States may also impose new tariffs on goods from Vietnam, including wood products, which will cause difficulties in exports and impact production,” Mr. Do Xuan Lap predicted.
Dr. To Xuan Phuc, Policy Analyst, Forest Trends Organization also affirmed that the picture of Vietnam's wood industry is greatly influenced by the relationship between China and the United States, therefore, the policies of President Donald Trump's Administration applied in the coming time will create changes affecting Vietnam's wood industry.
Dr. To Xuan Phuc predicts that the policies of US President-elect Donald Trump will create three main shifts in the coming time: Shifting the supply chain from China to other countries; shifting Chinese investment capital flows to other countries and policies on shifting immigrant labor. These policies will have a major impact on Vietnam's wood export activities.
Businesses need to improve their adaptability.
Dr. Huynh The Du, Lecturer in Public Policy and Director of Training at the Fulbright Economics Teaching Program in Vietnam, said that the Trump administration’s policies bring both opportunities and challenges. Therefore, Vietnam needs to be flexible in adapting, taking advantage of opportunities; promoting international cooperation and improving domestic competitiveness.
Pointing out specific challenges, Dr. Huynh The Du said the United States requires exported wood to have a clear origin and meet legal and environmental standards. Vietnamese businesses pay attention to the issue of proving that the source of raw materials does not violate international law.
“In addition, the Vietnamese wood industry will face the risk of being subject to anti-dumping or anti-subsidy taxes. The United States may investigate and impose taxes if it detects fraudulent origin or transshipment from a third country, for example: China transfers goods through Vietnam to avoid taxes,” Dr. Huynh The Du predicted.
Changes in US policies will also expose Vietnam to increased competition from other suppliers. Countries such as Malaysia, Indonesia and Thailand may take advantage to increase timber exports to the US, putting competitive pressure on Vietnamese products. On the other hand, the US will also increase support for the domestic timber industry, reducing dependence on imports.
According to Dr. Huynh The Du, Vietnamese enterprises need to adapt to new requirements from US policies, increase investment in technology and innovation; improve product quality and comply with international standards.
From the challenges and opportunities of the wood industry in the coming time, Dr. To Xuan Phuc said that businesses need to be ready to respond to anti-dumping investigations or trade defense measures from the United States by improving legal capacity and improving risk management. In the long term, if they know how to take advantage of opportunities from the shift of global investment and trade, the Vietnamese wood industry can become the leading wood processing and exporting center in the region.
Mr. Do Xuan Lap also stated that the Vietnamese wood industry is facing many major challenges from the global trade context. However, the wood industry is implementing many comprehensive solutions, from inter-sectoral coordination to improving the internal capacity of enterprises to effectively respond and adapt to new trends./.
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