The Ministry of Agriculture and Rural Development (MARD) plans to submit a new policy on incentives for foreign direct investment (FDI) projects to the Government for consideration in the fourth quarter of this year.
The move is one of a series of steps to attract greater foreign direct investment (FDI) into agricultural sector.
The bill is aimed to raise more credits and create incentives in land, trade and investment promotion, infrastructure and human resource development for the sector.
It will also prioritizes investment in agriculture, forestation, wood processing and animal husbandry in the hope that greater foreign investment would contribute to improving the export value of Vietnamese farm produce and reduce the proportion of raw materials in agricultural exports.
The Government has pledged to upgrade rural infrastructure, provide training for farmers, and conduct scientific research and transfers of technology through official development assistance (ODA).
MARD hopes that FDI will make up 11 per cent of the total VND145 trillion in agricultural investments by the time the roadmap expires in 2010.
Le Van Minh, Head of the International Cooperation Department under the MARD, said FDI projects have already contributed greatly to agriculture, forestry and rural development.
According to statistics from the Ministry of Planning and Investment (MPI), US$3.83 billion in FDI had been valid in agriculture and forestry projects alone as of July 2007, accounting 6 per cent of the country’s total FDI tally.
Tran Thi Thu from the Foreign Investment Department under the MPI, however, said that FDI in the sector remains modest and is focusing only in key economic zones.
Thu added that a majority of investors are Asian while those from regional and international agricultural powers such as the United States, Canada and Australia are more or less absent from the domestic industry.
Vietnam’s agricultural sector experienced rapid growth over the last decade, averaging some 4 per cent annually and contributing 20.9 per cent of the country’s GDP.
Some of the major problems plaguing Vietnamese agriculture that include slow returns are particularly hampered by storms and droughts, the middling ability of Vietnamese work hands in handling advanced technology and poor rural technical and material infrastructure. (VNA)
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