Addressing a national consultation workshop on FLEGT/VPA on August 3, Deputy Minister of Agriculture and Rural Development Hua Duc Nhi said Vietnam's timber processing industry has developed remarkably, creating jobs and contributing to the country's poverty reduction. 

However, he said, the industry is confronted with some challenges including low efficiency and productivity, a disadvantaged financial environment and difficulties in meeting new requirements on logging and sustainable timber sources. 

The FLEGT Action Plan, approved by the EU in 2003, will take effect in March 2013 as one of the EU's responses to international concerns about illegal logging and trading. It sets out supply-and-demand measures to combat the problem.

The implementation of the FLEGT/VPA aims to establish control and licensing procedures in timber producing and processing countries to ensure that only products made from legally-harvested timber can enter the EU. 
Vietnam and the EU started formal negotiations for the bilateral FLEGT/VPA last May and expect to sign the agreement late next year. 

"Global level consumer markets are changing and Vietnam needs to be prepared," said Hans Farhammer, first secretary and head of Economic Co-operation, EU Delegation to Vietnam, adding that European consumers now demanded guarantees to demonstrate that the products were not having negative environmental and social impacts.

Nguyen Tuong Van, head of Vietnam's standing office for FLEGT, said that Vietnam had about 3,400 enterprises that employed 300,000 in the timber processing sector. 

Last year, wood product export turnover reached US$3.34 billion, 10 times higher than in 2000.

The EU market is the second largest importer of Vietnamese wooden furniture, accounting for 30 percent of total exports, just behind the US with 45 percent.