Craft exports rise 6% in seven months

Handicrafts are produced by workers of Thanh Hoa Co in the northern province of Ni nh Binh's Yen Khanh District. — VNA/VNS Photo Dinh Hue

HA NOI — The export value of handicrafts in the first seven months of this year increased 6 per cent year-on-year to US$900 million though the handicraft industry still faced challenges, said Le Ba Ngoc, chairman cum general secretary of the Viet Nam Handicraft Exporting Association (Vietcraft).

The major export markets of Vietnamese handicraft products made an export value of $355 million from the US, $290 million from the European Union and $85 million from Japan.

Pottery, porcelain, bamboo and rattan products were still key export products for the industry, Ngoc said.

The association expected the industry to achieve an increase of 7-8 per cent in export value to $1.6 billion for this year against last year, he said.

"However," Ngoc said, "the most important figure was a growth rate of profit for exporters, for whom increased export profit means capital to continue production and export."

The export profit had a growth rate of 15-20 per cent each year in previous years but now the growth rate has declined to 10 per cent, he said.

With the low growth rate in export profit, the exporters found production difficult. They needed to get an increase of 15 per cent in export profit to invest in production, because their production activities suffered impacts from inflation and increases in the cost of raw materials and labour, he said.

Now, Vietnamese handicraft exporters have implemented export contracts with large importers in the world with a total export value of $100 million per year for each enterprise. But the large contracts had low profits and additionally, the large importers often asked to reduce the price of products by 3-5 per cent as a condition for co-operation.

Therefore, enterprises often did business with smaller importers who had contracts with high buying prices for handicraft products, he said.

Ngoc said other difficulties the industry faced were unprofessional marketing, advertising and trade promotion activities and design of products.

The industry should have professional designers and seek out alternative raw materials to diversify products and improve their quality, he said.

To create business opportunities for enterprises within the industry, the association plans to organise a trade fair, Ha Noi Gift Show 2012, in October. The show is expected to attract 250 domestic handicraft exporters.

Dao Thu Vinh, deputy director of Ha Noi's Industry and Trade Department, said this year, the trade fair was not for handicraft villages as in previous years, but was for exporters.

"The Ha Noi Gift Show 2012 is expected to attract visits by foreign importers from markets such as the US, the EU, Russia and Taiwan, because these importers also plan to attend another chain of trade fairs in the Asia Pacific region in October," Vinh said. — VNS