Legal timber supply chain: [1] A 'passport' for Vietnamese wood to reach far

According to the Department of Forestry and Forest Protection under the Ministry of Agriculture and Environment, Vietnam currently has 15.85 million hectares of forest land, including 15.5% special-use forests, 33% protection forests, and 51.5% production forests. These forests serve not only as the "green lungs" preserving biodiversity but also as a critical foundation for improving the livelihoods of millions of farmer households and rural communities.

680,000 hectares of forests certified

According to Mr. Vu Thanh Nam, Head of the Forest Utilization and Forest Product Trade Division under the Department of Forestry and Forest Protection, the forestry sector achieved outstanding results in the 2021–2024 period. Specifically, the area of natural forests was maintained at 10.13 million hectares (68.2%), while planted forests reached 4.73 million hectares. More than 537,000 hectares were zoned and promoted for forest regeneration, and over 1 million hectares of concentrated plantations were established, including nearly 445,000 hectares of large-timber forests. Each year, about 117 million scattered trees are planted nationwide, greening barren land and hills.

The conservation work has also been strengthened, with 167 special-use forests covering more than 2.3 million hectares and 5.5 million hectares of protection forests cared for by management boards, households, and local communities. Notably, as of August 2025, 680,000 hectares of forests had been certified under VFCS/PEFC and FSC standards, laying a foundation for Vietnam's wood industry to meet the stringent requirements of the global market.

Vietnam now has 6,200 wood processing enterprises, about 300 craft villages, and 16,000 production households. Thanks to this, the export turnover of forest products reached USD 17.35 billion in 2024, with imports at USD 2.75 billion, resulting in a trade surplus of USD 14.6 billion. Vietnamese wood products are now present in 150 countries and territories, affirming Vietnam's position as one of the world's major wood processing and export hubs.

In addition, forest environmental services contribute significantly to revenue. In the 2021-2024 period, total revenue reached nearly VND 14.7 trillion, with payments for forest environmental services accounting for more than VND 13.4 trillion. Currently, 7.45 million hectares of forest are under payment for environmental services, helping improve incomes and encourage local communities to participate in forest protection.

Deputy Director of the Department of Forestry and Forest Protection Nguyen Huu Thien frankly acknowledged that Vietnam's wood industry still faces numerous challenges. Forest management remains heavily reliant on manual processes and lacks robust digital transformation tools. Imported wood always poses risks; despite the existence of filters by country and geographical region, it remains difficult to fully control documentation from exporting countries. Meanwhile, Vietnam's major importing markets for timber and wood products have issued numerous legal documents and policies to ensure the verification of legal timber origins.

Alongside these challenges come numerous opportunities. Vietnam remains steadfast in its goal of maintaining 43% forest cover and improving forest quality while ensuring effective sustainable forest management. This provides a favorable condition for the wood industry to meet the new regulations of the European Union (EUDR) as well as those of other markets.

VPA/FLEGT - The key to sustainable export

After six years of negotiations, Vietnam and the EU signed the VPA/FLEGT Agreement in October 2018, which took effect in June 2019. The agreement ensures that all timber and wood products exported to the EU are legal and traceable. It also contributes to combating illegal logging and promoting sustainable forest management.

To implement this agreement, Vietnam has established the Vietnam Timber Legality Assurance System (VNTLAS), which applies to imports, exports, and domestic consumption. VNTLAS is built on the existing legal framework and supplemented with new management areas during negotiations with the EU. In 2024, Vietnam issued Decree 120 to further complete the VNTLAS's core elements. At the same time, capacity-building activities and multi-stakeholder coordination have been carried out.

After years of implementing the VPA/FLEGT Agreement, the VNTLAS has increasingly aligned with international standards. This achievement not only reinforces the credibility of Vietnam's wood industry with the EU but also builds confidence among global partners that Vietnamese timber is transparent, legal, and clean.

According to Mr. Nguyen Huu Thien, although Vietnam's timber exports to the EU do not yet account for a large share, the strict implementation of VPA/FLEGT serves as a "passport" demonstrating Vietnam's capacity and commitment to ensuring and verifying legality at every stage of the timber value chain, meeting the requirements of importing partners.

"When Vietnamese wood is recognized in the EU, considered one of the world's most demanding markets, it creates a sustainable competitive advantage in international markets, allowing Vietnam's wood industry to become a bright spot with greater market opportunities. Vietnam is ready to engage in this process and looks forward to support in terms of financing and experience from international organizations to further enhance its implementation," Deputy Director Nguyen Huu Thien said.

According to Ms. Anja Barth, Chief Advisor of the German Agency for International Cooperation (GIZ) in Vietnam, building a timber traceability system is costly at the outset, but once operational, it enables businesses to simultaneously meet the requirements of multiple markets, such as the EU and the U.S. The key is that the system must be digitalized, transparent, and robust enough to ensure traceability, with the long-term engagement of the Government, businesses, society, and international partners.

The project "Support to the implementation of the VPA/FLEGT Agreement in Vietnam," funded by the German Government with a total non-refundable grant of EUR 4.3 million (approximately VND 129 billion), is implemented by GIZ in cooperation with the Department of Forestry and Forest Protection. Implemented from October 2021 to September 2025, the project supports stakeholders in actions such as finalizing the legal framework, institutions, and operations to synchronize the VNTLAS, thereby realizing the objectives of the VPA/FLEGT.

Director of the Department of Forestry and Forest Protection Tran Quang Bao noted that the Department is currently implementing many synchronous solutions based on three pillars: economics, society, and environment. The focus is on improving institutions and policies, particularly after the administrative unit restructuring and the implementation of the two-tier government model.

Newly issued legal documents now cover the entire value chain, from forest protection and development to wood harvesting, the establishment of the legal timber system, processing, and export, to fulfill Vietnam's international commitments and reaffirm its responsibility for sustainable development.

*USD 1 = VND 26,198 (Source: Vietcombank)