Craft villages, a non-competitive and vulnerable part of Vietnam’s economy, will face greater challenges sparked by the establishment of the ASEAN Economic Community (AEC) by the end of 2015.

The AEC will effectively eliminate the majority of tariffs across the region, leading to significant pressure from mass imports and a risk that Vietnamese products may lose out in the domestic market.

Speaking at a recent forum concerning the difficult outlook, Vu Quoc Tuan, Chairman of the advisory council at the Vietnam Craft Villages’ Association, put forward a number of suggested measures.

He emphasised the necessity of enterprises operating in craft products to have basic knowledge of the AEC. A survey conducted by the Ministry of Planning and Investment unveiled 76 percent of surveyed domestic firms said they were completely unaware of the AEC.

The transition is more likely to produce positive outcomes if affected businesses research rival products and drastically prioritise enhancing their product quality, he said.

Tuan also pointed to the small scale of primarily family-run production facilities in craft villages nationwide and underscored the importance of connecting facilities to improve overall sector competitiveness.

At the forum, the Vietnam Fatherland Front Central Committee and the Vietnam Craft Villages’ Association called for additional State incentives and favourable policies facilitating the development of the traditional business.

A round-table talk is expected to take place at the end of March between the Vietnam Craft Villages’ Association and the Ministry of Industry and Trade, the Ministry of Finance and others to review the implementation of policies on craft village development and seek related solutions.-VNA