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Tiles

Vietnam, an emerging country

May 05, 2003
Vietnam, an emerging country05/05/2003 - With a tile production of just over 100 million square metres, still sold almost exclusively on the domestic market, Vietnam is the third largest producer in the Far East (after China and Indonesia) and eleventh in the world. According to the latest figures provided by local authorities, domestic tile consumption is increasing. A total of 6.55 million square metres of tiles were sold in January 2003, 35.7% up on January 2002.
The ceramic industry's growth has been extremely rapid: industrial production did not begin until 1995 and has increased more than fivefold in the past 5 years (just 18 million square metres in 1998). Estimated production in 2003 is 120 million square metres. (For table with production figures, see in-focus section). Today there are 45 companies operating in the country, including some that are very small. The largest companies have installed Italian plant and technologies, but there clearly remains a widespread need to modernise technology in order to achieve higher product quality. This is made all the more crucial by the need to increase exports, which totalled just US $4.8 million in the first 6 months of 2002. Today there are 45 companies operating in the country, some of which are very small. The largest group, the Viglacera Corporation, (see in-focus section) has an installed capacity of 20 million square metres per year. The largest companies have installed Italian plant and technologies, but there clearly remains a widespread need to modernise technology in order to achieve better product quality. This is made all the more crucial by the need to increase exports, which totalled just US $4.8 million in the first 6 months of 2002.

Continuous training for Vietnamese technicians

Because the Vietnamese ceramic industry is so young, there is a constant need to train the workforce employed in the sector. This is evidenced by the large number of ceramic technicians who took part in the first training course on the ceramic tile production process, organised by Acimac (Italian ceramic machinery manufacturers' association) and ICE (Italian Trade Commission) in Ho Chi Minh City from 24 to 28 February this year. A total of 130 people attended the lessons held by Giancarlo Carnevali and Paolo Zannini, which covered modern production techniques from raw materials preparation through to packaging of the finished product. The last day of the course was devoted to a workshop during which several Italian companies (Air Power Group, Sacmi, System, Tyrolit Vincent and Vicentini) presented their technological solutions.

A glance at Vietnam's macroeconomic indicators

The improvements in Vietnam's international relations, including its reconciliation with the USA (ratified in October 2001 through a bilateral trade treaty), its entry into ASEAN and APEC and the treaties under way for admission to the WTO, are critical factors for the country's further economic development, already second in the world in 2002 in terms of growth in GDP (+7.1%). Growth in 2001 was 6.8% and the target for 2003 is 7.5%.
In spite of the negative impact on Vietnam's performance caused by the slowdown in the world economy, exports rose by 2.8% and invested capital increased by 52% last year. Growth was driven principally by the increase in industrial and manufacturing production (+14.2% from January to September 2002) and to a lesser extent by services and agriculture. In spite of employing 63% of the country's manpower, agriculture accounts for just one-fifth of GDP.
The positive performance of the economy has been boosted by the Government's policies to make the country more attractive to investors. The effectiveness of these measures have been confirmed by the World Bank, which has approved a US $200 million investment package. The Government reforms include the phasing out of the State Owned Enterprises, which however still account for the majority of the country's companies.
The in-focus section provides figures on the public and private sectors.

All the figures for production and consumption of ceramic tiles along with a more detailed analysis of producer companies were published in a special feature on Vietnam in issue 51 of Ceramic World Review, printed at the end of April.vietnam.jpgThe figures about the ceramic tile industryThe Vietnamese ceramic tile industry
(values in millions of square metres) >>>>>
  1995 1996 1997 1998 1999 2000 2001 2002 2003 estimates
Production
Produzione		 1.5 5 11 18 29 55 95 105 120
Consumption
Consumo		 1.5 5 11 18 29 55 95 n.a n.a
Export - - - - - 0.5 0.8 n.a. n.a.
Import - - - - - - - - -
The public and private sectorsThe public and private sectors

While maintaining a socialist type economic model, Vietnam has intensified measures to further support its market including the important reform of State Owned Enterprises. Such companies have always maintained major roles or even monopolies in many sectors, but today are limited to key sectors of the economy and also receive smaller subsidies.

In the other sectors companies are being privatised. In the space of ten years, the number of state owned enterprises has fallen from 12,600 to less than half this figure. More than 50,000 private companies have been registered since January 2000, including 15,000 in the first 9 months of 2002.

However, in spite of the large number of companies the private sector still represents only a small part of the national economy. State owned enterprises still account for 57% of employment and 42.9% of capital.The Ice report on Vietnam (in italian)congiuntura vietnam.pdfViglacera Group, sector leaderViglacera Group, sector leader


 
The Viglacera Corporation is Vietnam's largest tile manufacturer and the leading building materials group. The Group was founded in 1974 and
comprises 30 subsidiaries located all over in the country which also operate in the sectors of glass, sanitaryware, refractories, heavy clay, ceramic raw materials, cement, industrial, civil and residential building planning, installation of industrial plants, professional training and corporate consulting in the building sector, importation, marketing and technology transfer in the building materials machinery sector.
Viglacera has always invested in hi-tech equipment and over the years has recorded a constant annual growth rate of nearly 20%. In 2002 it reported sales of US $145.6 million and has established a target of 32% growth in 2003 to reach a value of $192.5 million, including $8 million from exports (74% up on 2002). The Viglacera Group employs a total of 15,000 people.

For further information on the Viglacera Corporation, see the special feature on Vietnam published in issue 51 of Ceramic World Review, printed at the end of April.New investment by Toto VietnamNew investment by Toto Vietnam

Toto Vietnam, a company that belongs to the Japanese Toto Group, is building a factory in the Thang Long industrial area, 20 kilometres north of Hanoi. The production unit will extend over an area of 72,000 square metres and employ 400 people. Half of its output of ceramic tiles will be exported. The investment totals about US $23 million. Building and Construction Vietnam 2003 changes datesBuilding and Construction Vietnam 2003 changes dates


 
Building and Construction Vietnam 2003, the most important international exhibition in Vietnam
in the building, construction, energy and industry machinery sector and initially scheduled for the month of October, will be held from 3 to 6 December 2003 at the International Exhibition & Convention Center (HIECC) in Ho Chi Minh City. The change in dates was announced at the end of April by Adsale Exhibition Services Ltd, the organiser of the event, after the World Health Organisation removed Vietnam from the list of countries at risk of SARS.

This exhibition has always shown a strong presence of Italian companies. In December 2002, there were more than 20 Italian exhibitors, partly coordinated by the Italian Trade Commission (ICE) which organised a Punto Italia stand in cooperation with ACIMAC.

The exhibition consists of the following sections:

"Building and Construction Vietnam 2003" (tenth)
Building and construction machinery, building materials and products, ceramic, marble and glass machinery

"EP Vietnam 2003" (eighth)
Plant and equipment for energy generation

"Vinamac 2003" (second)
Industrial machinery, particularly for woodworking, plastic materials and rubber.

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