Paper businesses pin hopes on FTAs to boost exports

At present there are more than 300 businesses, the majority of which are small-scale enterprises, operating in the field of paper production nationwide. Following a recent period of positive export growth, there appears to be a promising outlook ahead for paper exports to the Chinese market following its swift recovery from the COVID-19 pandemic.

Experts believe that there is plenty of room for papermakers to boost tissue exports as the demand for the product remains high despite the impact of the COVID-19 epidemic. Yet local firms have still encountered difficulties when trying to export printing and writing papers as a result of low demand and high inventories, coupled with fierce competition in terms of price.

According to a VPPA representative, paper exporting enterprises must face up to challenges caused by price competition, especially for products imported from Indonesia, China, and Thailand from now till the end of the year.

Several businesses have been forced to temporarily suspend operations and tighten their spending. Packaging paper exports to markets such as Indonesia, Philippines, India, Africa, Japan, and Western Europe are also forecast to witness reductions.

Despite these challenges, local firms such as Hapaco Group and Viet Tri Paper Joint Stock Company have invested in production lines, striving to upgrade their equipment in an effort to improve the efficiency of their production capacity.

Moving forward, the local paper industry has high hope with regard to new-generation FTAs and upcoming FTAs. Indeed, the Regional Comprehensive Economic Partnership (RCEP) is poised to allow firms to enjoy tariff reductions, with tax rates for paper and paperboard being slashed to 0%.

Ha Ngoc Hoa, vice chairman of Bac Giang Import-Export Joint Stock Company, emphasised that joining these FTAs ​​will help firms, even small and medium-sized enterprises, increase their exports due to tariff barriers set to be removed.

Hoa added that these expectations can only be achieved once the COVID-19 epidemic is fully brought under control, therefore facilitating greater international trade exchange.