Overcoming Difficulties in Export: Vital for Agriculture Development

According to experts, the export of agricultural-forest and fishery products is declining in most sectors, causing many to slide into appalling hardships. Nguyen Hoai Nam, Deputy General Secretary of the Vietnam Association of Seafood Exporters and Producers (VASEP), said, seafood export plunged most in five years in the first three months of 2015. In addition to the fierce competition from rival exporters, Vietnamese companies are paying more than two times of transportation costs. In August 2014, the cost for shipping a batch to the United States was about US$1,800 but the rate has now amounted to US$3,900. Nguyen Ton Quyen, Chairman of the Vietnam Timber and Forest Products Export Association, said “Input costs have surged but selling prices cannot be uplifted. Therefore, we need incentive policies for small processing units.”

 

The current difficulty is attributed to rampant and unplanned development as it affects the quality of agricultural exports. Black pepper is one of “troubled’ exports as 85 percent of exported volume is in crude form while the European Union (EU) started to tighten control over pepper quality from 2015. The Vietnam Pepper Association has proposed the Ministry of Agriculture and Rural Development survey current pepper cultivation practices and control pesticide residues. Furthermore, the rapid expansion of pepper acreage caused difficulties in training farmers to adopt appropriate practices for farmers. Negative impacts of overheating development also produced pressures on domestic consumption and export.

 

While Vietnam is integrating more deeply into the world market as it will sign more free trade agreements (FTAs) in the coming time. Other countries will open their doors wider for Vietnamese products to enter their markets and Vietnam will do similarly. Accordingly, most of agricultural, forest and aquatic products imported into Vietnam will be levied zero tax by 2018. “Therefore, we will have to compete with foreign products in our home market,” said Minister Cao Duc Phat. According to experts and officials from 63 provinces and cities, ministry-affiliated units must actively support information for localities and businesses to support products to world markets.

 

To deal with this hardship, the agricultural sector must step up trade promotion. Specifically, to troubleshoot difficulties in the tea sector, Minister Cao Duc Phat requested the Department of Crop Planting (DCP) organise a conference on sustainable tea development and meet with Vietnamese companies to seek solutions to export 25,000 tonnes of tea. He also surged the Agro-forestry Processing and Salt Industry Department to intensify the frequency of quality monitoring, survey regulations and requirements in foreign markets, and instruct tea association and businesses to have adequate information to export tea to foreign markets. Minister Cao Duc Phat suggested that “Should we go to coffee-growing countries to jointly set up pricing guarantee associations. For example, Brazil is the world’s largest coffee exporter with 45 million bags a year and Vietnam is the runner-up with 26 million bags. The two countries account for 60-70 percent of the world’s coffee export volume. We will go nowhere if we only discuss domestic affairs. The Ministry of Agriculture and Rural Development will support the Vietnam Coffee Association to work with associations in other countries.”

 

Apart from export issues, the ministry also collected opinions on transportation, foreign exchange rates, tax and policies from businesses and associations to report to the Government for troubleshooting solutions at the earliest.

 

Nguyen Trong Thua, Department for Quality Control of Agro-forestry and Fishery Products and Salt Industry, said: “At present, the Ministry of Agriculture and Rural Development has built policies and implementation plans for the situation by means of planning. Many experts highly appreciated implementation plans in some localities and sectors. The planning covers production zones, advantages, acreage, productivity and accompanied solutions. To successfully execute policies, apart from mechanisms, the administration plays an important role. Some broken plans have affected market supply/demand. For instance, coffee acreage is planned to be expanded by 520 ha but the actual additional area is 600 ha. Rubber area is planned to be add 580 ha but the real area expanded is over 1,000 ha. Hence, we must do well planning and execution.”