Vietnam Rubber Group: Upholding Tradition and Advancing Sustainable Development

In celebration of the 95th anniversary of the Traditional Day of the Vietnamese rubber industry (October 28, 1929 - October 28, 2024), Mr. Tran Cong Kha, a member of the Standing Committee of the Party Committee of the Central Enterprises Bloc and Chairman of the Board of Directors of the Vietnam Rubber Group (VRG), shared with our reporter about the group’s 95-year journey and its orientation for the future.

Mr. Tran Cong Kha, Chairman of the VRG Board of Directors, along with VRG leaders paid a working visit to the factory of VRG Kien Giang MDF Joint Stock Company

Throughout its development, VRG has achieved significant milestones, greatly contributing to economic growth, national defense, and social stability. Can you tell us the foundation of this success?

Rubber seeds were officially introduced to Vietnam in 1897, marking 127 years of history intertwined with revolutionary movements and the struggle for national liberation. A significant milestone in the development of the traditional rubber industry occurred on the night of October 28, 1929, with the establishment of Communist Party of Indochina (CPI)’s cell in Village 3 of the Phu Rieng plantation, under the leadership of Comrade Ngo Gia Tu. This marked the first Party cell in the Southeast region, located in what is now Thuan Phu commune, Dong Phu district, Binh Phuoc province. Throughout the country’s long struggle for independence, rubber plantations served as both a support system, providing human and material resources, and a frontline in the fight against the enemy. Many patriotic individuals, including rubber workers, sacrificed their lives alongside the people and soldiers of the Eastern region, contributing significantly to the heroic efforts that culminated in the great victory on April 30, unifying the country.

Given the stature and historical significance of the establishment of the Indochinese Communist Party Cell at the Phu Rieng rubber plantation, October 28 each year has been officially recognized by the Ministry of Culture and Information as the traditional day of the rubber industry.

Throughout its development, VRG has encountered many difficulties. Despite these obstacles, VRG has consistently demonstrated resilience, successfully navigating adversity to achieve effective and sustainable growth. It not only manages state-assigned resources efficiently but also actively preserves and develops them, making significant contributions to the country’s innovation and modernization efforts.

In recent years, the Vietnamese rubber industry has encountered many difficulties, including unfavorable rubber latex prices, the impacts of the COVID-19 pandemic, military and trade conflicts between countries, as well as fluctuations in both domestic and international economies. However, with the leadership and support of the Party, State, and Government, especially from the Party Committee of the Central Enterprises Bloc and the Commission for the Management of State Capital at Enterprises (CMSC)—VRG has remained resilient, navigating difficulties, stabilizing operations and pursuing sustainable development.

Rubber processing workers

How has the VRG Board of Directors formulated its strategy for stable and sustainable development in the next period?

VRG is currently advancing effective development across five core business areas: rubber planting, harvesting, processing and consumption; the rubber industry; wood processing; investment in the infrastructure of industrial parks and clusters on rubber land; and high-tech, clean agriculture.  Recognized as a pioneering enterprise, VRG has achieved notable success in implementing sustainable development strategies and green growth initiatives anchored in three key pillars: economic development, social responsibility and environmental protection.

In 2024, VRG remains committed to sustainable development based on three pillars: economy, society and environment. It aims for a revenue of VND24,999 billion (101.2% compared to 2023), an after-tax profit of VND3,437 billion (102% compared to 2023), and a contribution of VND3,437 billion to the State budget (100.9% compared to 2023). For the parent company, the targets include a revenue of VND3,988 billion (100.2% compared to 2023), an after-tax profit of VND1,454 billion (101.5% compared to 2023), and a contribution of VND1,454 billion to the State budget (103.5% compared to 2023). VRG is also dedicated to maintaining stable employment for over 81,000 workers, providing an average income of more than VND7 million per person per month. Additionally, the company aims to create optimal conditions for workers to develop their household economies, fostering a strong connection between their livelihoods and the growth of the rubber industry.

VRG is steadfast in its policy of developing the economy alongside social security, prioritizing the creation of welfare projects to enhance the living conditions of workers. It is deeply committed to sharing challenges, expressing gratitude and fostering community development, consistently engaging in these initiatives across all regions where VRG’s member units operate, including both domestically and in neighboring Laos and Cambodia. These efforts have garnered significant appreciation from local authorities and communities. Moreover, VRG has proposed many strategies to attract and retain ethnic minority workers, contributing to the establishment of industrial production practices for farmers in remote, isolated and border areas. This commitment not only aids in stabilizing social order but also supports the construction of new rural areas in rubber-growing regions. Additionally, VRG’s economic activities contribute to maintaining national security and defense while strengthening friendships between Vietnam and Laos, as well as Vietnam and Cambodia.

In recent years, the Party and Government have honored VRG with many prestigious medals and orders, recognizing the significant contributions of VRG and the generations of employees and workers in the Vietnamese rubber industry to the revolutionary struggle for national liberation, as well as to the country’s industrialization, modernization and development. This recognition serves as a great honor for all those who have worked in the Vietnamese rubber industry. Building on these achievements and traditional values, VRG is committed to overcoming challenges, fostering unity, encouraging innovation, and striving to meet its highest targets and objectives for 2024 and beyond.

With the vision of establishing VRG as a leading enterprise in agricultural production, the focus is on efficiency, scale, product quality, the application of high technology and environmental sustainability in Vietnam. VRG aims to enhance its role in the development of agriculture, farmers and rural areas by integrating production with the construction of technical infrastructure and actively recruiting ethnic minority workers. It is committed to continually improving productivity and increasing workers' incomes. Additionally, VRG seeks to harmoniously balance economic development with the responsibilities of ensuring social security, political stability and national defense within its operational framework.

According to the restructuring plan approved by the Prime Minister, VRG aims to effectively execute the tasks assigned by the Government through the Commission for the Management of State Capital at Enterprises. By 2025, the goal is to develop key operational areas, with an expected total revenue increase of over 30% compared to the present, and a profit growth of approximately 20%, with a projected acceleration in growth following 2025. Specifically, VRG's consolidated revenue is anticipated to reach VND161,730 billion, averaging about VND32,300 billion per year, while the consolidated profit before tax is projected at VND34,435 billion, averaging around VND6,870 billion per year. The parent company's after-tax profit is expected to be approximately VND12,350 billion, with an average of VND2,470 billion per year, reflecting an average annual increase of 7%.

To achieve these goals, VRG must focus on synchronously implementing several important solutions: strengthen the Party's leadership in Party building and rectification while performing political tasks throughout VRG; consolidate and promote the glorious and heroic historical tradition of the rubber industry; foster unity among all cadres, employees, and workers to collaboratively build VRG and the Vietnamese rubber industry for effective and sustainable development; and promote digital transformation by applying science, technology and information technology to management practices. It will also convert some rubber areas for higher-efficiency production; maximize rubber plantation capacity; maintain product quality to enhance value; implement the Green Growth and Sustainable Development Strategy for 2023-2030, with a vision to 2050; and enhance brand value while expanding international markets.

Endless green rubber forest

What message do you wish to convey for the 95th anniversary of the rubber industry's traditional day?

In commemorating the 95th anniversary of Communist Party of Indochina (CPI)’s cell  and the Traditional Day of the Vietnamese rubber industry (October 28, 1929 - October 28, 2024), it is essential to reflect on the glorious historical tradition and the journey that has shaped VRG and the Vietnamese rubber industry. This development is rooted in the struggles, sacrifices, tireless efforts and unwavering dedication of generations of cadres and workers over the past 95 years. By honoring our past and taking pride in the industry's achievements, we can strengthen our resolve and inspire renewed motivation and confidence in the bright future of the rubber industry. Our commitment is to build VRG into a sustainable entity that contributes to the overall prosperity of the country.

On this occasion, I would like to extend heartfelt gratitude and deep appreciation on behalf of the Board of Directors of VRG to the previous generations and all employees who have bravely fought, protected, built and continuously contributed to establishing a strong position for the rubber industry today.

On behalf of the leaders of VRG, I would like to extend my heartfelt gratitude to the leaders of the Party, State, and Government, as well as the central ministries, local authorities, and our customers and partners both domestically and internationally for their guidance, attention and assistance to the development of the Vietnamese rubber industry and VRG.

In the future, it is our firm belief that all employees in the rubber industry will continue to uphold the heroic traditions of our sector. We will foster solidarity, dedication and enthusiasm in production efforts. Together, we will strive to build a sustainable rubber industry that honors the significant contributions of previous generations and reflects the prestige of the Gold Star Order awarded by the Party and State to the Vietnamese rubber industry.

Thank you very much!

By Van Luong, Vietnam Business Forum