Ministry imposes ban on log exports
The Ministry of Industry and Commerce has imposed an export ban on logs and unprocessed sawn wood following the prohibition instruction given by the government.
The move aims to add value to wood resources by processing them domestically before they are exported.
Recently, the ministry issued an order prohibiting the export of all kinds of logs and unprocessed sawn woods – timber must be processed before being exported.
Logs cut or excavated from various projects such as mining and infrastructure development projects as well as hydropower projects must undergo an open bidding process for sale to local wood processing plants so that the logs are processed before being exported.
Those trees cut from plantation areas grown by local people or businesses are also being encouraged to be processed domestically. However, the export of logs cut from plantation timber is allowed in cases where the export is certified by the relevant authorities.
The ministry has also instructed Vientiane, as well as provincial and district authorities to inspect wood processing plants across the country in order to ensure the plants meet certain standards set by the ministry.
Those plants failing to meet the standard will be required to improve their operation to meet the acceptable standards before being allowed to continue their operations.
In this regard, the authorities will define the timeframe required to complete the improvement and report progress made to higher authorities regularly, according to the ministry's order.
The ban came as local wood processing plant operators are suffering from a raw material shortage and calling for the government to increase the wood quota to fulfill their growing demand for wood for processing.
An official of the Lao Furniture Association told Vientiane Times in recent months that some furniture businesses have given up their operations after being unable to source enough wood to fulfill their orders.
In light of the issue, the association has asked for 30 percent of the government's annual wood quota to sustain their businesses but this has not been approved as yet, the association's official Mr Bounpheng Phengsisavath said recently.
Most of the furniture makers that are still operating, especially those in Vientiane, are having to buy wood from timber yards instead of using wood supplied under government-allocated quotas.
He said the shortage is creating problems for the association as it tries to expand the market because of concerns about product supply. The demand for wooden furniture is high in both the Lao and foreign markets but supply is limited. There is a strong Chinese market demand for Lao furniture if the association is able to supply products in sufficient quantities.
The association was optimistic that the log export ban would provide sustainable raw materials for making furniture and other wood products in Laos.
By Souksakhone Vaenkeo
(Latest Update November 11, 2015)