Plastic

Elastomers, also called Plastic or polymers, are used as materials for manufacturing appliances that are contributing significantly to serve human life as well as to the development of several industries and economic sectors such as: power, electronics, telecommunication, communication and transportation, aquatic products, agriculture, etc. Along with technologies and sciences development, elastomers also have applications and become alternative materials for conventional materials that seem to be irreplaceable such as wood, metal, silicate, etc. Therefore, plastic industry has been increasingly playing a crucial role in both life and production in countries. Currently, plastics industry needs about 3.5 million tons of input materials such as PE, PP, PS, etc., not to mention hundreds of various auxiliary chemicals; meanwhile domestic supply is just satisfying about 900.000 tons of raw materials, chemicals and additives of Vietnamese plastic industry demand.

Therefore, imports of plastic raw materials for plastic industry have been increasing both in quantity and in value through the past years. So, it can be seen that plastic industry currently is only relying on local sources with roughly 20 - 25% of total input raw materials and chemicals, while the balance should be entirely imported so that manufacturing activities of the industry have to depend on imported raw materials and semi-products. Forecasts to 2020, Vietnamese enterprises in the plastic industry will need about 5 million tons of raw materials for production activities. Therefore, if the industry cannot gain initiative in raw materials sourcing this would be a big obstacle for production as well as plastic enterprises competitive ability on the market in the context that Viet Nam has already finalized a series of several bilateral and multilateral free trade agreements.

Besides that, production costs in plastic industry also fluctuate due to the fluctuation of the price of imported plastic raw materials, specially prices fluctuation of the two most-used raw materials in production, which are PP and PE with an average increase of 11,7% in the last five recent years.

At present, the entire plastic industry of Viet Nam consists of more than 2000 enterprises, spread over from the North to the South and most of them are located in Ho Chi Minh city (over 84% enterprises are located in Ho Chi Minh city). They are operating under all kind of capital-owned forms of which private enterprises are accounting for more than 99,8%.

Private enterprises are commonly evaluated as a dynamic section of the entire economy, so that it can be said that plastic industry is one of the dynamic economy sectors of the country. Featured products of Vietnamese enterprises are plastic packaging, household plastic products, plastic products in building industry and high-tech plastic products.

There is a great variety of plastic products that are increasingly used in various sectors and industries. In consumer applications, plastic products are used as packing materials, household products, stationery, toys, etc. In other economy sectors , plastic products applications become more and more popular; in particular in some sectors such as building, power-electronics, etc. plastics have become alternative materials for conventional materials. 

Products requiring high quality such as oil pipes, automobile plastics and computers applications also have been produced successively by Tien Phong, Cat Thai, Tan Tien, Binh Minh plastic enterprises.

Also contributing to the development of plastic industry are foreign-investment enterprises activities, in other words, plastic industry is becoming an attractive economy sector for foreign investment. Exports growth mainly originate from foreign-invested enterprises. The reason is that Vietnamese plastic products are not subject to EU anti-dumping tariffs while products coming from China, Thailand, and Malaysia are. So that Chinese, Malaysian and Thailand’s firms have moved their production facilities to Viet Nam to avoid from anti-dumping taxes as well as import taxes difference on commodities imported from China, because goods with Vietnamese origin imported to EU will be subjected to lower taxes than Chinese-origin goods by at least 10%.

Especially, Japanese firms are approaching and already have invested in Viet Nam’s plastic industry. The participation of foreign-invested enterprises on the one hand will create positive impacts such as up-to-date technologies, modern management skills, augment the industry export turnover; on the other hand it will also bring about strong competitiveness against local enterprises.

Due to low capital and technological limitations, local enterprises will be easily eliminated in competition against foreign enterprises. However, there still is a restriction within the industry which is the lacking of bond between businesses or professionalization in production that is driving to investments in great number but low efficiency or to a situation in which enterprises manufacturing the same products are creating a very high competition in domestic market, reducing the operating efficiency of each enterprise as well of the entire industry.

Despite of problems in operations the plastic industry of Viet Nam is little by little affirming its position in the economy. Vietnamese plastic products are not only broadly consumed locally but also exported and controlling a great number of foreign markets.

Strong increases of exports turnover indicated that Vietnamese plastic products are consumed in several countries in the world and affirming the great importance of the industry within the general development of the whole industry.

In foreign markets, Vietnamese plastic products competitiveness ability is highly rated as production technologies have approached the world modern level and are accepted by the market. At the moment Vietnamese plastic products are marketed in more than 150 countries and territories such as: Japan, Cambodia, Laos, Thailand, China, India, Middle East, Africa, EU, USA, etc…. Among export markets, there is a market where Vietnamese plastic products have been well positioned which is Japan; new potential markets such as China, India, Russia, East Europe, Africa with high demand for plastic packaging, household and building products.

 

 

 

In the past time, Viet Nam major exports are Plastic products categories such as: Plastic sheets; pellets; household Plastic products; pipes and fitting; sanitary Plastic products; Plastic products used in building industry; packing industry; consumer Plastic products:stationery, handicraft – cosmetics, toys, etc…