"Although the livestock industry in the country has achieved much success, there is an inadequate problem that the key share of main sectors of the industry is dominated by FDI" said Mr Hoang Kim Giao, Head of Animal Husbandry Department (Ministry of Agriculture and Rural Development) in an investment promotion conference on the livestock sector in 2012 organized by the Animal Husbandry Department.
Along with the development of agriculture, livestock sector in Vietnam in recent years has made encouraging achievements. The average growth rate in 10 years is about at 6-7 percent per year. Vietnam's total meat production in 2000 was 1.83 million tonnes, and in 2011 4.314 million tonnes; putting meat production per capita to increase from 23.6 kg / year to 48.3 kg / year, the total output milk increased from 64,000 tons (2000) to 360,000 tons (2011).
However, according to the Mr Hoang Kim Giao, Vietnamese livestock sector is still heavily traditional with small-scale and dispersed. According to the statistics in 2011, the country still had over 6.5 million households and 6202 farms. Mr Giao stressed that: "It is the small and scattered features and lack of alignment in the livestock sector make the FDI attracting in this sector not efficient. Also we have to mention a number of other causes such as production and trading activities containing risks; the State’s unclear and inappropriate strategies and directions in addition to the vague mechanism and policies in attracting FDI into the livestock sector. "Mr Giao showed the evidence that total FDI for the livestock sector was only US$269.7 million (2010) and is estimated to reach US$365.3 million (2012), a small proportion of the total capital investment in the sector agriculture.
However, in the field of activities, FDI is still dominant. According to the Competition Act, the market share of each FDI company does not exceed 30 percent, but significant market share in key sectors of the livestock industry is in favor of foreign companies. For example, in the production of animal feed, currently there are 233 animal feed production plants, of which there are 58 plants of the FDI enterprises (including 100 percent foreign-owned companies and joint ventures). With small quantities, accounting for nearly 25 percent of the factories but FDI enterprises account for 60 percent of industrial output feed conversion. These include a number of foreign enterprises accounting for a large share in the production of animal feed industry like: Vietnam Joint Stock Company accounting for about 18 percent, Pronco 12 percent, New Hope about 9-10 percent, Cargill 8 percent and Vietnam's Green Feed about 8 percent. Meanwhile, the domestic enterprises account overwhelmingly with the number of 175 enterprises, but production capacity is limited, producing only 40 percent of the total feed.
Not only invested heavily in the animal feed sector, FDI enterprises concentrate on livestock production. Especially in the field of white-feathered poultry production, these enterprises are dominant. Typically JAPFA, Vietnam Joint Stock Company and EmivestCompany produce average of 6 million chickens / month for farmers. Similarly, in the field of veterinary medicine, FDI enterprises account for 80 percent of market share, the remaining 20 percent share belonging to the domestic companies.
The FDI enterprises engaged in livestock sector are dominant in the egg and meat products in Vietnam. Typically, Vietnam Joint Stock Company has market share of 50 percent of eggs, 30 percent of chicken and 7 percent of meat. Besides, though providing only about 5 percent of pigs, this company accounts for 8 percent of pork products on the market due to the breed quality and modern farming technology.
Through the above analysis, we can see the livestock sector in Vietnam is being manipulated by FDI enterprises. This situation requires domestic livestock enterprises to cooperate with each other, not to invest in only field of animal feed but to develop in a large-scale including animal production, slaughtering and distribution in order to be more in the country. Experts at the conference said that the state should soon have practical and effective policies to encourage and support domestic livestock enterprises to develop and be more competitive with FDI enterprises.
My Chau
Vietnamese
