Vietnam Agriculture Advancing Integration into Global Value Chain

2:12:45 PM | 2/11/2020

The complicated development of the ongoing COVID-19 pandemic has adversely affected people’s livelihoods, economy and society, and disrupted global agricultural supply-consumption chains. However, Vietnam has still managed to ensure food security as it has made due investment in high-tech and sustainable agriculture. Deputy Minister of Agriculture and Rural Development Tran Thanh Nam shares with Vietnam Business Forum’s reporter on this issue. Minh Ngoc reports.

Vietnam is confronting numerous difficulties and challenges such as natural disasters, epidemics and extreme climate. Agriculture, as a pillar of the economy, has still ensured food security. What do you think about this?

Resolution 26-NQ/TW defines “Building a comprehensive modern and sustainable agriculture, developing large-scale commercial production, generating high productivity, quality, efficiency and competitiveness and firmly ensuring national food security both in the short term and in the long term.” Vietnam's agricultural sector not only ensures national food security but also exports many highly valued products.

At the back of the COVID-19 pandemic outbreak, food and foodstuff need to be addressed for growth. As for food, Vietnam needs to ensure the output of 43.5 million tons of rice for domestic consumption and for export. As for foodstuff, the country will expand the farming of cattle and poultry. It will harvest 20 million tons of vegetables, 13.5 million tons of tubers and fruits, 9.5 million tons of aquatic products, 5.8 million tons of meat, 1.2 million tons of milk, and 14.6 billion eggs. The country will strive to achieve an export value of US$40-41 billion. The agriculture including forestry, cultivation, fisheries and husbandry will play a key role in boosting GDP growth in the new period. The four pillars of agriculture have helped the sector’s GDP growth in particular and the country’s GDP growth in general although 2020 has so far witnessed numerous difficulties and challenges exposed to the agricultural sector like the COVID-19 epidemic, climate change and natural disasters such as drought and saltwater intrusion in the Mekong Delta, floods in the central region, hails and thunderstorms in the north.

In the coming time, the agricultural sector will still face various challenges caused by epidemics and natural disasters. Therefore, it has prepared scenarios to accelerate production when the disease is under control. It is necessary to focus on promoting production, overcoming difficulties and supplying food in all circumstances; focus measures to control epidemics, prevent food price hikes. It will prepare best conditions to boost production and find new markets for disease-controlled export commodities.

High-tech agriculture is an advantage and a solution for sustainable agricultural development. In your opinion, where is Vietnam standing in relation to other countries in the region?

Agriculture is one of main drivers of economic growth and sustainable development. Developing a high-tech agriculture that is competitive, climate-resilient and well integrated into regional and global supply chains is one of the current major priorities of ASEAN countries.

The COVID-19 pandemic gave rise to the export drop of agricultural, forest and aquatic products to major markets such as China, the United States, and the European Union (EU) while the ASEAN market emerged as a bright spot. For a long time, ASEAN has been considered a potential but tough market because there are products similar to those made by Vietnam while their prices are cheaper. Many countries in the region like Thailand have a more developed agriculture. However, the COVID-19 pandemic is providing many opportunities for Vietnamese agricultural products to conquer this market.

Determining that high-tech agriculture is essential for organic and productive agriculture, the Party, the National Assembly and the Government have introduced many guidelines and policies to accelerate high-tech application to agriculture and modernize agriculture and rural areas. Government policies have attracted many large businesses to upgrade their competences and form powerful agricultural groups along value chains to enhance the quality and value of Vietnam's agricultural products, stabilize the domestic market, and win competition in the international market.

Some typical large companies include VinEco, Vinamilk, Hoang Phat Fruit, Nafoods, TH True milk, Dabaco Vietnam, Masan, Lavifood, Ba Huan and Bien Dong. At present, Vietnam has 1,292 high-tech agricultural cooperatives out of 15,592 agricultural cooperatives. The country has developed 1,484 food safety chains. In addition, the Government has supported establishing three high-tech agricultural zones to create nuclear technology for some greenfield zones (in Phu Yen, Bac Lieu and Hau Giang).

In the coming time, to successfully carry out agricultural restructuring policies, apply advanced technology to agricultural production for domestic and export markets, the Government of Vietnam will further improve the investment and business environment, create a favorable environment to attract businesses to invest in high-tech agricultural development and advance deeper and more effective integration.

Food safety is the minus point of some Vietnamese agricultural products when exported to the world market. What solutions will the Ministry of Agriculture and Rural Development take to deal with this matter?

Joining new-generation trade agreements such as CPTPP and EVFTA provides great opportunities but also poses challenges for domestic agricultural production. In addition to increasing food quality and safety requirements from importing countries, importers also raise barriers to protect domestic production, leading to difficulty for Vietnam's agricultural exports to enter foreign markets.

The Ministry of Agriculture and Rural Development has directed and launched many solutions, with focus placed on reviewing legal documents concerning execution of free trade agreements like EVFTA and CPTPP to propose the Government for timely adjustments to match international integration purposes. In particular, the ministry has promoted communications on incentives and advantages of each agricultural product line to agricultural enterprises; attracted and assisted them to invest in downstream processing to increase domestic value content and understand EVFTA regulations for proper application and gain benefits from this trade agreement; built market development strategies for agricultural products with the EU market and attracted EU companies to invest in Vietnamese agriculture to link Vietnam's agriculture with the global agricultural value chain.

Source: Vietnam Business Forum