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Vietnamese wood furniture firms are focused mostly on export markets, leaving the local market to imports, especially from China.
Huynh Van Hanh, deputy chairman of the Handicraft and Wood Industry Association of HCM City (HAWA), said with its population of 86 million and increasing incomes, Vietnam is a promising market for furniture and other wooden products.
Demand for wooden indoor furniture has grown at an annual rate of 15-20 per cent in recent years, he said.
But Vietnamese firms, among the world's largest exporters of wood products, continue to ignore the local market, which, at 3 billion USD, is equal to the export market, Hanh said.
They accound for just 20 percent of the Vietnamese market, with imports from mainland China, Malaysia, Taiwan, Hong Kong and Thailand accounting for the rest.
Dien Quang Hiep, director of Binh Duong-based Minh Phat Furniture Company, said companies prefer exports to domestic sales because orders are usually big. The domestic market not only places small orders but also requires various designs.
And then there is the cost of setting up distribution systems, he pointed out.
Furniture shops on Ngo Gia Tu and To Hien Thanh streets in District 10, Nguyen Thi Minh Khai in district 3, and other places in HCM City, display a lot of imported furniture products.
Tran Hoang Trung, owner of a shop on Ngo Gia Tu street, said most of his products are from China and they come in a range of designs and materials.
As for local products, he sold the odd table made of natural wood, he said.
Many foreign companies, mostly Chinese, import large quantities of timber from Vietnam at cheap prices and export finished products at high prices to Vietnam.
Many distributors import 30-40 containers of furniture every month from China, according to insiders.
Nguyen Ton Quyen, general secretary of the Vietnam Timber and Forest Product Association, said the low import tariffs on wooden products, of 0-3 percent, encourage furniture distributors to import them, creating pressure on domestic producers.