The wood processing industry is to become a spearhead economic sector by 2025, posting export turnover of about US$20 billion to contribute to socio-economic development and stabilise the livelihoods of people living in forested areas.

At a wood processing plant. Foreign investment in the wood processing industry in Vietnam has increased significantly in recent years.

Addressing a conference in Hanoi on August 20 to review policies on forestry investment and those on processing and trading forestry products, Deputy Minister of Agriculture and Rural Development Ha Cong Tuan said the forestry industry has recorded high growth in recent years, especially in export turnover.

The sector aims to improve the quality of forests and promote value and production chains for forestry products, focusing on investing in protective and special-use forests to protect the environment and ensure long-term biodiversity.

Support will be provided to poor farmers and the vulnerable, helping them access policies on forestry protection and development in combination with livelihood improvement.

Apart from promoting exports, it is also necessary to develop the domestic market which is valued at around US$3 billion and demand keeps rising, Tuan said.

He underlined the need to have mechanisms and policies on non-timber forestry products, stressing that priority should be given to developing medicinal products.

Scientists believe that the environmental value and the value of non-timber forest products are about three to four times higher than the value of timber.

According to the Vietnam Administration of Forestry (VAF), about VND50 trillion was mobilised for developing the forestry sector in the 2016-2020 period, including over VND8.7 trillion from the State budget, over VND3 trillion in official development assistance (ODA) capital, and nearly VND27 trillion invested by organisations and individuals.

According to Bui Chinh Nghia, deputy general director of VAF, investment policies for the sector have proven effective, as the natural forestry area has been managed and protected well, forest quality has gradually improved, and forest coverage increased to 41.89% in 2019 from 40.84% in 2015 and is expected to hit 42% this year.

Many concentrated material areas have been created for the wood processing industry, reaching over 1.3 million ha.

The value of forestry production increased by an average of 5.73% annually in the 2016-2020 period. The export value of wood and wooden products rose to US$11.3 billion in 2019 from US$7.1 billion in 2015, and is estimated to reach over US$12 billion this year.