Plastic exports are expected to grow by 12–15% this year, according to the Vietnam Plastics Association (VPA).
Main plastic exports markets
Mr. Ho Duc Lam, chairman of the association, said the country’s key export markets this year would be Japan and the US, which have high demand. Besides, other markets such as China, Laos, Cambodia and Myanmar are expected to become new plastic exports markets in the future.
Vietnamese plastic bags are still subject to anti-dumping duties (ADD) in the US market. However, the US imposition of ADD has had almost no impact on exports of the sector.
Every year, the average US import turnover is more than US$50 billion for plastics and plastic products, accounting for 9.1% of the world’s total import of plastics, according to VPA.
The largest plastic exports market is Japan, with an average growth rate of 20–25% every year. Japan is one of the most difficult markets with many strict regulations on the quality of goods. Therefore, Vietnamese plastic exporters have been urged to improve quality, design and trade promotions to enter this market. Currently, Vietnam ranks sixth in the top 10 countries exporting plastics to Japan.
Mr. Lam recommended that Vietnamese plastic producers prepare long-term strategies and invest in market research to increase their penetration into the Japanese market.
In addition, the EU’s demand for plastic products imported from Vietnam is high, especially plastic pipes.
Vietnam’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%). Thus, Vietnamese producers are also urged to seek new export markets.
Challenges of Vietnamese plastic exporters
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% of raw materials are still imported from other countries.
Each year, the plastic industry needs an average of 4 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’s difficult to take advantage of tax incentives in FTA.
Exporters also need to focus on environmentally-friendly and safe products for sustainable growth.
Vietnam’s plastics industry earned $3 billion last year, posting a 17.3% increase over 2016, according to VPA.