Cơ hội và thách thức đối với hoạt động xuất khẩu gỗ và các sản phẩm gỗ việt nam sang canada trong bối cảnh thực thi hiệp định cptpp

● Tóm tắt Gỗ và các sản phẩm từ gỗ luôn là một trong những mặt hàng xuất khẩu chủ lực của Việt Nam. Ngày 1412019, Hiệp định CPTPP chính thức có hiệu lực với sự tham gia của 11 quốc gia và được kỳ vọng sẽ mở ra nhiều cơ hội mới cho ngành gỗ Việt Nam, đặc biệt là cơ hội mở hồng thị trường. Tuy nhiên, bên cạnh nhiều ưu điểm, Việt Nam chắc chắn sẽ phải đối mặt với nhiều thách thức và sự cạnh tranh từ các đối thủ. Bài nghiên cứu của chúng tôi nhằm phân tích những cơ hội và thách thức xuất khẩu gỗ và sản phẩm gỗ của Việt Nam sang Canada trong bối cảnh CPTPP. Cuối cùng, một số khuyến nghị sẽ được đề xuất cho chính phủ và doanh nghiệp Việt Nam nhằm nâng cao hiệu quả hoạt động xuất khẩu. Từ khoá: CPTPP, xuất khẩu gỗ và các sản phẩm gỗ của Việt Nam.

CƠ HỘI VÀ THÁCH THỨC ĐỐI VỚI HOẠT ĐỘNG XUẤT KHẨU GỖ VÀ CÁC SẢN PHẨM GỖ VIỆT NAM SANG CANADA TRONG BỐI CẢNH THỰC THI HIỆP ĐỊNH CPTPP • Tóm tắt Gỗ sản phẩm từ gỗ ln mặt hàng xuất chủ lực Việt Nam Ngày 14/1/2019, Hiệp định CPTPP thức có hiệu lực với tham gia 11 quốc gia kỳ vọng mở nhiều hội cho ngành gỗ Việt Nam, đặc biệt hội mở hồng thị trường Tuy nhiên, bên cạnh nhiều ưu điểm, Việt Nam chắn phải đối mặt với nhiều thách thức cạnh tranh từ đối thủ Bài nghiên cứu nhằm phân tích hội thách thức xuất gỗ sản phẩm gỗ Việt Nam sang Canada bối cảnh CPTPP Cuối cùng, số khuyến nghị đề xuất cho phủ doanh nghiệp Việt Nam nhằm nâng cao hiệu hoạt động xuất Từ khoá: CPTPP, xuất gỗ sản phẩm gỗ Việt Nam OPPORTUNITIES AND CHALLENGES FOR EXPORTING VIETNAM WOOD AND WOOD PRODUCTS TO CANADA IN THE CONTEXT OF CPTPP IMPLEMENTATION • Abstract Wood and wood products have consistently been one of Vietnam’s primary exporting products On January 14, 2019, CPTPP officially became effective with the participation of 11 countries and it is projected to open up new opportunities for the timber industry of Vietnam, especially in terms of expansion to new markets However, alongside numerous merits, Vietnam will definitely face several challenges and competition from other rivals Our study aims at analyzing the opportunities and the challenges of exporting wood and wood products of Vietnam to Canada in the context of CPTPP Finally, some recommendations will be proposed for Vietnam’s government and enterprises with a view to enhancing efficiency of exporting activities Keywords: CPTPP, Vietnam’s wood and wood products export • Literature Review A large body of previous research has been conducted to analyze the impact of CPTPP to the regional economy and multiple economic aspects of member countries Chunding Li & John Whalley (2021), using a general equilibrium model to assess impacts of CPTPP on multiple countries, stated that most member countries will benefit from trade integration and that most non‐member countries will lose due to the exclusion effects of the regional trade agreement, but effects for specific countries differ Vietnam, as a member country of CPTPP, was estimated to experience a 1.9% increase in the export turnover compared to the non-CPTPP scenario, which again emphasized the importance of CPTPP to the economic development of Vietnam (Van Su Ha and Hoi Quoc Le, 2019) According to the Food and Agriculture Organization (2020), the world timber industry valued approximately 244 billion USD dollar with main primary wood product consuming regions namely Eastern Asia, Europe and Northern America These regions accounted for 82% of global consumption, while hosting only about ⅓ of the world population Many of the Eastern Asia and North America nations are members of CPTPP, which showed the increasing importance of CPTPP nations to the world timber industry In the case of Vietnam, Nhieu, N T., Lien, T H., & Lan, T H stated that Under CPTPP commitments, many key export sectors of Vietnam including wood and wood products experienced opportunities to increase export turnover However, there have been few former studies working on wood and wood articles of Vietnam in the Canada market Therefore, the paper aims to expand on this theme and focus on the Canadian market for Vietnamese timber and wood products Overview of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) 1.1 Formation history of CPTPP The Comprehensive and Progressive Agreement of Trans-Pacific Partnership (CPTPP) is a new generation free trade agreement (FTA) with 11 members, namely Australia, Brunei, Canada, Chile, Japan, Malaysia, New Zealand, Peru, Singapore, and Vietnam Initially, the Trans-Pacific Partnership Agreement had the participation of countries, therefore, the agreement was abbreviated as P4 Instead of proceeding with the then-P4, they proposed that the countries begin negotiating a new agreement referred to as the Trans-Pacific Partnership (TPP) The CPTPP originated from the Trans-Pacific Partnership, which was a proposed trade agreement between 12 countries The TPP negotiations began in 2008, but the agreement was not signed due to the withdrawal of the United States in 2017 In November 2017, the 11 remaining countries agreed to change the name of the Agreement from TPP to CPTPP in Da Nang, Viet Nam, retaining the fundamental contents The agreement was officially signed on March 8, 2018 in San Diego, Chile On December 30, 2018, CPTPP came into effect with the first group of countries that completed the procedures for ratification of the agreement 1.2 The main content of CPTPP The CPTPP consists of 07 Articles and 01 Appendix stipulating the relationship between 12 countries including Australia, Brunei Darussalam, Canada, Chile, United States, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam The CPTPP Agreement generally preserves the contents of the TPP Agreement (including 30 chapters and appendices) However, the CPTPP allows member countries to postpone the implementation of 20 sets of requirements to assure a balanced distribution of rights and obligations These groups of obligations include 11 obligations related to the Intellectual Property Chapter, related to the Government Procurement Chapter, and the remaining related to Chapters: Customs Administration and Trade Facilitating, Cross-border Trade in Services, Financial Services, Telecommunications, Environment, Transparency and Anti-Corruption Despite the changes, all core commitments outlined in the TPP Agreement are still upheld in the CPTPP Agreement 1.3 Commitment between Vietnam and Canada regarding wood and wood product exports 1.3.1 Tariff Preferences For raw timber products, 100% of exports from Vietnam to Canada will enjoy 0% import duties as soon as the CPTPP takes effect between the two countries (from 14th January 2019) For processed wood products, the preferential import tax rate according to the CPTPP agreement for Canada ranges from 0-3% 1.3.2 Rules of Origin Woods and wood products shall be treated as originating goods if: • • • they are wholly obtained, i.e woods and wood products that are grown and harvested entirely in Vietnam or a CPTPP country; they are produced in Vietnam or a CPTPP country entirely from originating materials; they are produced in Vietnam or a CPTPP country from non-originating materials that undergo production in Vietnam or a CPTPP country, such that the resulting good satisfies the applicable product-specific rules of origin (PSR) PSR requires non-originating materials to undergo a change in tariff classification from any other heading, as specified in Appendix 3-D, Chapter 3, the CPTPP Agreement: ● For woods and wood products (listed in Chapter 44): apply the HS Change in Tariff Classification (CTC) at the 4-digit level (i.e Change in Tariff Heading (CTH)) ● For wood furniture (listed in Chapter 94): apply CTH or the Regional Value Content (RVC) criterion with a ratio of 30-55% depending on each good and its RVC calculation methodologies Other provisions include: ● Accumulation Goods or materials that qualify as originating in any CPTPP country when used in the production of a good in another CPTPP country will be treated as originating in that country For any production undertaken in one or more CPTPP countries on materials that not meet the CPTPP rules of origin, the value added from that production is still counted towards the origin of the final manufactured goods in another CPTPP country ● De minimis If the non-originating materials used in the production not meet the requirement for HS code conversion (i.e CTH for woods and wood products), but if these materials not exceed 10% of the value of the goods, then the goods qualify as originating goods ● Transit and transshipment Originating woods and wood exports from Vietnam that transit through a non-CPTPP country before arrival in Canada remain as originating in Vietnam if: they not undergo any production other than unloading, reloading, operation, storage, labeling, or any other steps necessary to maintain their good condition during the delivery to Canada; and must be under customs control at all times in that non-CTPPP country Regarding origin procedures, after the CPTPP took effect for Vietnam on 14th January 2019, Vietnam applied the mechanism of agencies and organizations authorized by the ministry to issue Certificates of Origin (C/O), that is, continue to apply self-certification of origin The transition time to implement the self-certification of origin mechanism will last up to 10 years from the effective date of the CPTPP Thus, if woods and wood products exported from Vietnam to Canada want to enjoy preferential tariffs under the CPTPP Agreement, such goods must be granted a CPTPP-standard C/O form from Vietnam, which is issued by C/O-issuing agencies and organizations authorized by the Ministry of Industry and Trade (including Hai Phong City Department of Industry and Trade and 19 other Regional Import-Export Management Departments across the country) 1.3.3 Trade Remedies The Special Import Measures Act (SIMA) allows Canada to apply the following trade remedies: anti-dumping, countervailing, safeguards, and anti-circumvention taxes The situation of Vietnam's wood and wood products export activities in the context of CPTPP 2.1 Overview of Vietnam’s timber industry and timber’s export activities Vietnam is one of the world’s largest exporters of timber and timber products In 2020, Vietnam's total export turnover of wood and wood products reached 12.37 billion USD, up 16.2% compared to 2019, accounting for 77.2% of total export turnover In the first 11 months of 2021, Vietnam's export turnover of wood and wood products reached about 13 billion USD, up 20% over the same period in 2020, in which the export value of wood products reached 9.9 billion USD, increased by 16.6% over the same period in 2020 It can be seen that the growth rate of this commodity in Vietnam has increased steadily over the years in the past ten years Figure 1: Export turnover of Vietnam’s wood and wood products in the period from 2009 to 2020 (Unit: Billion US$) 14 12.37 12 10.56 10 8.91 7.66 6.9 2015 2016 6.23 5.56 4.67 3.44 3.96 2.6 2009 2010 2011 2012 2013 2014 2017 2018 2019 2020 Source: General Department of Vietnam Customs Vietnam exports high-value timber in six primary categories, including but not limited to furniture, chairs, wood chip, plywood/joint board, wood pellet, and rotary veneer Since 2005, Vietnam's only furniture export value has increased dramatically, from less than USD billion in 2005 to more than USD 12 billion in 2020, representing around 6% of the worldwide market share at the time Figure 2: categories of high-value export wood & furniture of Vietnam in 2021 3% 1% 7% 7% 45% 12% Furniture Chair Wood Chip Plywood/Joint Board Wood Pellet Rotary Veneer Other 25% Table 1: Vietnam's wood and wood products exported to other countries in the first nine months of 2020 and 2021 From Jan-Sep 2020 Market From Jan-Sep 2021 Total Value Growth Rate Percentage Increased (US$) USA 4.6 Billion 6.5 Billion 40.5% Japan 908 Million 1.01 Billion 11.7% China 920 Million 1.13 Billion 23.4% Korea 587 Million 650 Million 10.7% EU 358 Million 438 Million 22.3% UK 156 Million 194 Million 23.9% Canada 144 Million 175 Million 21.3% Australia 107 Million 111 Million 3.3% Source: Forest Trends and the Associations: FPA Binh Dinh, HAWA, BIFA The table demonstrates that the dominant importers of Vietnam’s timber and wood products from January to September 2021 were the US (USD 6.5 billion), China (USD 1.13 billion) and Japan (USD 1.01 billion) Other essential importers included the EU, UK, Canada and Australia In the first quarter of 2022, export turnover to Japan, Korea and the UK continued positive growth with a rise of 11.3%, 18.4% and 14%, respectively Vietnam has emerged as a vital actor in supplying raw timber materials and exporting furniture products to the global market The new generation FTAs that Vietnam has recently signed and implemented with these importers will create a conducive environment for broader timber trade expansion, as the export tariff will gradually reduce to 0% 2.2 Overview of the Canada import market for timber and wood products Canada is one of the world’s largest producers, exporters, and importers of timber and wood products The primary sources of Canada’s wood imports were the United States, China, Brazil, Germany and Turkey Figure 3: Supplying markets for Canada’s wooden furniture in 2022 Supplying markets for Canada's wooden furniture in 2022 4000000 3645866 3500000 3150128 3000000 2500000 2000000 1500000 1000000 500000 USA China 142433 146909 Brazil Germany Imported value (US thousand dollar) Source: Trade Map ITC Canada has a robust wood industry with an output of up to 600 million m 3/year The country is also one of the top 10 furniture manufacturers in the world However, Canada's import demand for wooden furniture continues to grow strongly in the context of the country's furniture industry reducing domestic production due to the inability to compete with foreign markets having the advantage of cheaper costs, including Vietnam Regarding specific items, living room and dining room furniture, wooden frame chairs, and bedroom furniture are the three imported items that account for the highest proportion in the Canadian market Trends and consumption habits of these products of Canadian consumers can be mentioned as follows: ● The growing trend towards compact, multi-purpose furniture made from eco-friendly materials ● Canadians favor products that are durable and long-lasting, so there is an increasing demand for high-end furniture ● Wood products exported to Canada should focus on materials that can withstand the impact of climate change and weather because in winter Canada is very cold ● Consumer demand in the Canadian market for Asian products is important to low- and middle-income people who cannot afford Canadian-made products 2.3 Vietnam’s Timber and Wood Products exports to Canada in the context of CPTPP 2.3.1 Before signing CPTPP Before Vietnam signed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), high tariffs limited market access and posed challenges for Vietnamese exporters The main products related to wood and wood processing are classified under HS Chapter 44 and 94 Prior to the signing of the CPTPP agreement, goods exported from Vietnam to Canada in general, and wood and wood products in particular, enjoyed preferential treatment under two tariff regimes: Most Favored Nation (MFN) within the framework of the World Trade Organization (WTO) and the General Preferential Tariff (GPT) regime a MFN tariff regime within the WTO framework: The MFN tariff is the tariff level that Canada has committed to within the WTO framework since 1995 Vietnam is one of the 228 countries enjoying Canada's MFN tariff preferences For wood and wood products specifically, the current MFN tariffs range from 0% to 9.5%, with wooden furniture, which is a major export item of Vietnam, having tariffs ranging from 6% to 9.5% b GPT tariff regime: Since 1974, Canada has implemented a generalized system of preferences for developing and least developed countries with the aim of supporting their economic development The GPT regime does not cover all products However, for wood and wood products classified under Chapter 44 and Chapter 94, the GPT regime applies to all these product lines GPT tariffs for wood and wood products range from 0% to 6%, with wooden furniture having the main GPT tariffs ranging from 3% to 6% Despite the challenges, before the CPTPP, Vietnam's exports of timber and wood products to Canada did show some increases, but the growth was slow and limited compared to the potential growth that could be achieved with more favorable trade conditions Figure 4: The value of Vietnam's W&WP exports to Canada in the 2016 - 2018 period (Unit: US dollar thousand) 160,000 140,000 120,000 100,000 80,000 60,000 100,116 127,472 123,608 40,000 20,000 10,479 2016 9,875 6,189 2017 Woods and articles of wood; wood charcoal 2018 Wooden furniture Source: Trade Map ITC 2.3.2 After signing CPTPP Regarding tariffs, when it comes to signing the CPTPP, Canada commits to eliminating import tariffs for 95% of tariff lines, equivalent to 78% of Vietnam's exports to Canada, immediately upon the effective date of the agreement Specifically for raw timber products (HS Code 44), 100% of Vietnam's export value to Canada will enjoy a 0% tariff rate as soon as the CPTPP agreement takes effect for both countries (meaning from January 14, 2019) For processed wood products (HS Code 94), the preferential import tariff under the CPTPP agreement of Canada ranges from 0-3% Comparing the three mechanisms, the preferential tariff under the CPTPP agreement is the lowest compared to the MFN and GPT mechanisms, especially for wooden furniture, which is a strong export product of Vietnam Figure 5: The value of Vietnam's W&WP exports to Canada in the 2019 - 2021 period (Unit: US dollar thousand) 250,000 200,000 150,000 100,000 176,620 165,297 140,865 50,000 11,230 17,083 22,666 2019 2020 2021 Woods and articles of wood; wood charcoal Wooden furniture Source: Trade Map ITC According to the data from Trade Map, Vietnam’s export value of wood and wood products to the Canadian market reached nearly 152,095 thousand USD in 2019 To be more specific, in 2019, Vietnam’s export value of wood and wood products saw a noticeable rise of 14,748 thousand USD, representing a 10.7% increase compared to 2018 In the next 3-year period from 2019-2021, a robust growth was also witnessed in the value of Vietnam’s wood and wood products’ export to Canada, ending the year 2021 at a pretty high number (199,286 thousand USD), although the growth rate in 2021 decreased due to the impact of the Covid-19 pandemic, which resulted in the halt in the production and processing of wood in many provinces and cities across the country Among these exports, wooden furniture accounted for the majority, comprising about 90% of Vietnam's total exports Other products such as wood, timber, wooden handicrafts, and mirror frames also experienced strong growth In terms of non-tariffs, there are still specific barriers that affect the situation of Vietnam’s woods and wood products export to Canada after CPTPP, including: Technical barriers to trade (TBT): These are measures such as technical regulations, standards, or conformity assessment procedures that can create obstacles for exporters Canada has specific requirements for the quality, safety, and labeling of wood products that Vietnamese exporters had to comply with Sanitary and phytosanitary (SPS) measures: These are measures that aim to protect human, animal, or plant life or health from risks arising from pests, diseases, additives, contaminants, toxins, or organisms Canada requires that wood packaging materials be treated 10 and marked according to the International Standards for Phytosanitary Measures No 15 (ISPM 15) to prevent the introduction and spread of pests Customs administration and trade facilitation: These are measures that affect the efficiency and transparency of customs procedures and border management Canada requires that importers submit an electronic declaration of their goods before arrival, and that they pay any applicable duties and taxes upon entry Delays or errors in these processes can increase the cost and time of trade 2.4 Evaluation of Vietnam's wood export activities to Canada after CPTPP entered into force The CPTPP has opened up new opportunities for Vietnam’s wood export activities to Canada by removing tariffs and setting up a transparent and predictable trading framework Under the CPTPP’s commitments, Vietnamese wood and wooden products have enjoyed duty-free access to the Canadian market since 2019 This has increased the attractiveness of Vietnamese wood products in the Canadian market, one of the world’s largest importers of forest and value-added wood products Consequently, Vietnam’s wood exports to Canada grew by 10% in 2019 and 16.6% in 2020 compared to the previous years Vietnam is Canada's sixth-largest forest and value-added wood product exporter, after the United States, China, Brazil, Indonesia and Chile The main products exported by Vietnam to Canada are furniture, wooden frames, wooden toys and bamboo products However, Vietnam’s wood export activities to Canada also encounter some difficulties, such as the high standards for the legality of timber sources, the traceability of the supply chain, and environmental protection Therefore, Vietnamese wood exporters must enhance their product quality and reputation and comply with the CPTPP rules to further penetrate the Canadian market In addition, Vietnam’s wood export activities to Canada are also influenced by the global and regional economic situation, especially the COVID-19 pandemic, which has disrupted trade flows and reduced consumer demand In 2020, Canada’s GDP shrank by 5.54% to 1,645 billion compared with GDP in 2019, while Vietnam’s GDP expanded by only 2.9%, the lowest rate in decades To overcome these challenges, Vietnam and Canada must foster cooperation and dialogue under the CPTPP framework and explore new opportunities for trade diversification and innovation in the forestry sector Opportunities and Challenges 3.1 Opportunities Many opportunities have opened up for Vietnam's wood industry, especially exports to the Canadian market since Vietnam became a member of CPTPP To begin with, Canada is believed to be a large and potential market with high demand for the wood and wood products exported from Vietnam According to the ITC’s report, Canada ranked 11th place in world imports for wood and wood articles in 2021 Timber, oil and automobile production are the main industrial economic sectors of this developed economy Despite the adverse impact of Covid 19 pandemic, Vietnam’s exported value of wood products 11 from Canada in the period 2020-2022 witnessed a positive trend with 433 million USD in 2020, 593 million USD in 2021 and 604 million in 2022 Besides, Canada welcomes approximately 400,000 new immigrants every year, making the market for furniture active and stable The Canadian home furniture market is forecasted to achieve an average growth rate of 6% in the period 2021 - 2025 Second, at the end of 2022, Canada officially announced the Indo-Pacific strategy, which positioned ASEAN as the center of the region and wished to sign a Canada-ASEAN free trade agreement As the largest trading partner of Canada in ASEAN, Vietnam obviously has some advantages over the other countries Additionally, Vietnam is considered by most Canadian businesses as a reasonable gateway to enter the region thanks to its advantages in geographical location, infrastructure, labor, and socio-political stability Third, the import and export tax exemption policy is a significant benefit that allows Vietnamese timber manufacturers to potentially increase their market share in the Canadian market Thanks to the commitment of CPTPP Agreement, Vietnam's wooden furniture have more competitive advantages in price in the Canadian market due to the preferential import tax of 0% In addition, this tax reduction policy provides Vietnam a golden chance to penetrate deeper into the North American market as Canada is an important gateway of this region Fourth, there are ample rooms for Vietnamese enterprises to enter this potential market and expand their market share in the near future At present, Vietnam is the fourth largest wooden furniture supplier to Canada and among the 10th most suppliers of wood products However, according to VCCI, Vietnam's exports to Canada only account for 1.48% of Vietnam's total exports to the world and the proportion of wood imported from Vietnam only accounts for 0.9% of Canada's total import value in 2021 These figures are not commensurate with the current development potential of Vietnam's wood industry and the advantage of CPTPP Fifth, Vietnam has a lot of opportunities to increase its exports of wooden items to Canada due to their very competitive prices, premium raw resources, and stable product quality Leon’s Furniture, the largest furniture retailer in the nation, is one of the notable companies in Canada's wood sector that already has production facilities and long-term relationship arrangements with Vietnamese suppliers The CPTPP is expected to make Vietnam more attractive to foreign businesses wishing to participate in the nation's wood processing industry The wood business in Vietnam will be able to establish its brand and quickly grow its market in North American nations and Latin countries if it can successfully enter the Canadian market with more items Sixth, with the support of CPTPP, plenty of job opportunities are created, and incomes in the wood industry steadily increase over time, improving people's quality of life Additionally, by participating in the Canadian market, the human resources of the wood sector will have chances to get access to cutting-edge technology from all over the world, which is helpful in boosting the number of top-notch human resources for Vietnam 3.2 Challenges The export of Vietnam's timber and wood products to the Canadian market may be affected by a number of difficulties, both objectively and subjectively 12 ● Challenges arisen from subjective factors: First, it is undeniable that the Vietnamese timber industry and wooden products itself have certain limitations One of the biggest barriers to the export activities of Vietnam is the lowqualified domestic transport and logistics capacity, followed by the lack of trained labor resources Additionally, the slow application of technology and low-efficient administrative procedures are considered weaknesses of many Vietnamese wood processing and exporting firms Besides that, Vietnam might suffer from legal risk when importing into Canada as Vietnam imported wood materials from various resources, many of which the source is from outside of CPTPP countries These weaknesses are likely to make Vietnam's export prices less competitive than other South American countries, which are neighbors of Canada Additionally, the lack of knowledge about intellectual property might pose obstacles to the export activities of Vietnamese wood exporting enterprises Many firms have not realized the importance of registering patents in foreign countries Especially in the design field, the number of products authentically designed by the Vietnamese is extremely small Most products we produce are based on the designs of other countries This makes Vietnamese brands difficult to stand out and garner attention from local customers as well as attract new investors Furthermore, due to the poor understanding of IP protection, Vietnam’s wood exporting companies can suffer a significant decrease in profits as they fail to prevent counterfeit products or face legal problems ● Challenges arisen from objective factors: Second, the fact that Canada maintains a low exchange rate policy to promote exports is believed to be detrimental to Vietnam If measured in local currency, the price of furniture imported from Vietnam might become more expensive than that of local enterprises in 2023 As a result, the competitiveness of Vietnamese wood items in the Canadian market and its market share will significantly decline Third, dumping is another issue that Vietnam should thoroughly consider Although Vietnamese wood products exported to Canada are exempt from tax, some items are being considered by Canada to impose anti-dumping duties and other trade remedies In fact, at the end of December 2020, the Government of Canada initiated an anti-dumping investigation into upholstered chair products originating from Vietnam However, only out of hundreds of Vietnamese manufacturing enterprises participated in answering the survey questionnaire As a result, these eight enterprises were only subject to a tax rate of 3.7%, while others were subject to a tax of 179% Fourth, Canada is a fastidious market that has strict legal requirements for timber origin and quality: Most unprocessed wooden articles that are imported into Canada must have a phytosanitary certificate and a plant protection import permit Wooden articles from an endangered tree species require a CITES Certificate and permit All wood packaging material must be heat treated or 13 fumigated with methyl bromide, debarked (prior to fumigation, if applicable), treated and marked by the authority of the National Plant Protection Organization (NPPO), and bear an ISPM 15 Besides, timber, flooring, pulp and paper, and other wood products obtained from sources associated with illegal logging are subject to WAPPRIITA (Wild Animal and Plant Protection and Regulation of International and Interprovincial Trade Act) import prohibitions Additionally, Canada’s timber input exporters are advised to demonstrate their high capacity via FSC certification (Forest Stewardship Council), a voluntary certification that sets guidelines for responsible timber exploitation and management across all requirements Vietnamese wood export businesses must abide by these strict requirements as well as pay close attention to inputoutput openness and the legitimacy of timber sources in order to access this prospective market Chen J, Wang L & et al (2020) has proved that Forest certification was a trade barrier for developing countries and the export competitive effect of forest certification in developing countries is greater than that in developed countries Fifth, tax reduction policy is likely to increase competitive pressure for Vietnam in the Canadian market Vietnam's wood and wood articles will have to compete with other suppliers from CPTPP member countries which have high capacity in production Moreover, many of the top 10 Canada’s wood suppliers, namely Korea, Chile and Peru, have signed a bilateral free trade agreement with the host country This somehow does affect the competitiveness of each country in the Canadian market as close and firm relationships are believed to bring greater benefits for the trade partners Recommendations 4.1 In respect of the government For a large and potential wood market like Canada, Vietnam has many opportunities to evolve and gain market share To achieve the goal of developing the export industry of wood and wood products, the government needs to take specific measures to facilitate and promote businesses to go further into the North American market, especially in Canada First, the government should focus on investing in research and development of competitive advantages of wood products exported from Vietnam It further discusses the importance of capacity-building measures and improvements to infrastructure to leverage the agreement's trade potential Based on the current situation, the government should have specific policies to ensure the quality of exports and meet the stringent regulations of foreign markets The government and relevant ministries need to actively seize opportunities and at the same time surpass the limitations that Vietnam's wood and wood products industry is facing One weakness that must be overcome in Vietnam's wood and wood products industry is low human resources and a lack of trained resources The government and related departments can promote the quality of workers by organizing vocational training programs and providing basic equipment and supplies The promotion of application of modern advanced technologies also contributes to increasing labor productivity, facilitating development In particular, Vietnam should focus on 14 exploiting its “dynamic comparative advantages” by investing in the development of products and industries based on technology, skills, and know-how to increase added value and achieve step-by-step control of the stages in the export chain (Gereffi, 2002; Gereffi & Memedovic, 2003; Ha, 2010, 2016) One example is to invest and develop concentrated industrial zones and craft villages to take advantage of the large workforce with low labor costs In addition, the government can use strict resource management measures, rational exploitation, and active afforestation, contributing to the sustainability of Vietnam's timber export industry Afforestation and material forest development will create a sustainable supply of timber and help regenerate damaged forest areas The government can support citizens and businesses in afforestation by providing investment capital, planting techniques, and effective forest management At the same time, the government needs to formulate promotions and incentive policies for businesses and individuals to participate in afforestation activities and develop a sustainable supply of timber Another measure that Vietnam's government should consider executing is to support enterprises to take advantage of CPTPP Agreement Enterprises, especially small and medium businesses need to be fully aware of commitments related to tariffs, rules of origin, quality standards, and technical measures Government should focus on enhancing and efficiently executing information regarding market conditions, trade policies, and export measures in CPTPP partner countries Acknowledging integration commitments, enterprises can set the foundation to undertake restructuring in their production processes and reduce mistakes that lead to export interruptions Businesses can develop effective strategies to access the markets of Vietnam's CPTPP partners, especially Canada 4.2 In respect of enterprises Firstly, businesses should have strategies to manage the input materials, production process, cultivation, and other related aspects to ensure that the export products meet the Rules of Origin, the requirements of quality, components, packaging, and labeling when approaching the Canadian market At the same time, firms are required to gather documents proving the origin of goods, instructions for goods, and other certificates to eliminate any obstacles during trade Secondly, to meet the needs of the Canadian market, collecting information on consumer tastes is extremely important for Vietnam wood product exporters Wood products exported from Vietnam have different materials from wood products from Canada, in which maple and temperate woods are used mainly Therefore, businesses need to conduct thorough research on consumer tastes and diversify export products to meet the needs of this market Thirdly, enterprises should consider promoting the development of distribution systems to foreign markets to fully exploit the commercial value of products Most Vietnamese businesses are following orders from existing partners or customers By owning and controlling distribution, businesses can optimize transportation, storage, and management operations, reducing costs, increasing flexibility, and responding quickly to customers' demands Vietnamese wood exporters can set up sales channels directly or through agents, distributors, or retail stores Controlling the 15 distribution process enhances the ability to promote products, reach new markets, and build trust and credibility with customers • Conclusion Overall, Canada can be considered a highly-potential market for Vietnam’s wood and wood product exports for its application of 0% import duties on all Vietnam's raw timber products and 0-3% on processed wood products as soon as the CPTPP takes effect On one hand, the opportunities that Vietnam’s wood and wood products industry could seize from the Canadian market are huge, encompassing the key economic role of wood and wood products in the Canadian economy, the large and fast-growing domestic market size along with Vietnam’s current position as the fourth largest wood furniture supplier to Canada Now with the CPTPP coming into force, the 0-3% import duties policy would further facilitate Vietnam's wood and wood product exports to the Canadian market On the other hand, Vietnam’s wooden businesses could face various challenges upon the contents of the CPTPP First, some challenges arising from subjective factors are the lowqualified domestic transport and logistics capacity; the lack of trained labor resources; the slow application of technology and intellectual property violations; the fact that the industry still relies on imported wood materials, which are either from non-CPTPP countries or regions with high legal risks; and the time-consuming and complex nature of administrative procedures, making Vietnam's exports less appealing Other challenges include Canada’s low exchange rate policy; dumping; strict legal requirements for timber origin and quality; the balancing act between the pros and cons of FSC certification, which is highly recommended when entering the Canadian market, for Vietnam; and the increasing competitiveness due to tax reduction policy To optimize the opportunities and mitigate the challenges, our group would like to suggest some measures for the government and enterprises For the Vietnamese government, it should issue specific policies on the quality of exports to meet Canadian requirements; leverage Vietnam's dynamic comparative advantages; preserve the domestic forests and wood areas; and facilitate enterprises to utilize the CPTPP For enterprises, they must first and foremost ensure that they have met all product requirements when exporting to Canada Besides, they should invest more in consumer tastes to keep up with the demand of the market as well as develop and fully control their distribution systems instead of via third parties • References Ha, V S & Le, H Q (2019), “The impact of participation in the comprehensive and progressive trans-pacific partnership agreement on exports: The case of Vietnam”, 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