An array of free trade agreements (FTAs) coming into effect this yearwill open up a wide range of new blindingly bright opportunities for theagricultural sector leading to improved investment opportunities alongthe entire value-chain, reported The Voice of Vietnam (VOV).
Amore perplexing dilemma however, is determining the best business modeland strategy to lift agriculture from the production of low value staplefood commodities higher up the value chain to make the best of theopportunities.
It was not by chance that the 45th World EconomicForum (WEF) held recently in Davos (Switzerland) placed the issue offood security for more than 7.2 billion people in the world to theforefront of its agenda.
This fact clearly shows the increasinglyimportant role that food producers and suppliers play and most notablyhighlight Vietnam’s critically important role in ensuring food securityin the world.
However, despite being one of the world’s leadingagro-forestry-fishery exporters, Vietnam's agriculture revealsweaknesses— low value products at cheap prices, inefficient use of landand natural resources, limited agricultural investment and poor hygieneand food safety.
With the current status of productivity andquality of agricultural products, Vietnamese farmers and businesses arein a pickle to take advantage of the coming golden opportunities absentextensive investment and renovation. Thus, opportunities could be missedand leave Vietnam stagnant, producing low value commodities.
Investors from the Republic of Korea, Australia and Japan are activelylooking for favourable investment opportunities and have embarked on anumber of land lease projects for production, processing and exports inVietnam.
If Vietnamese farmers are off the mark in negotiatingthese agreements they could find themselves simply working as farmlabour for foreign investors, or in other words – they will just beemployees on their soil.
In the face of limited agriculturalinvestment, foreign direct investment (FDI) inflows in agriculture areinvaluable. Therefore it is critically important that these agreementsbe structured in a manner that enables local farmers and agro businessesto team up with foreign investors on an equal partnership basis.
Ona positive note, in recent times, a series of big enterprises acrossmany fields have shifted their investment in the agricultural sector tolarge-scale agricultural projects based on high-tech models which havebrought higher efficiency.
The expanding capital inflows intothe agricultural sector show that sufficient resources to restructurethe sector are available – it’s just a matter of sitting down at thenegotiating table and working out the details.
To this endhowever, businesses need the support of the government and moreincentives to help entice foreign investors to fund land andinfrastructure purchases as well as acquire the necessary technologiesto revamp the agriculture sector.
To call for more agriculturalinvestment, the Vietnam Ministry of Agriculture and Rural Development(MARD) has been working hand in hand with multinational groups toimplement the public–private-partnership (PPP) model.
Additionally,the MARD, last year, drafted a strategy for attracting FDI in the agro-forestry- fisheries sector until 2030 for submission to the PrimeMinister for approval.
Agriculture is the biggest advantage ofVietnam’s economy and it logically follows therefore that agriculturalrestructuring is crucially important in negotiating free tradeagreements. Restructuring is seen as a monumental opportunity that willbenefit the whole national economy.
Successful restructuringwill not only enable Vietnam to become an agricultural power, but alsoserve as a promoter of the industry and service sectors in furtheranceof transforming into an industrialised and modern nation by 2020.-VNA
Amore perplexing dilemma however, is determining the best business modeland strategy to lift agriculture from the production of low value staplefood commodities higher up the value chain to make the best of theopportunities.
It was not by chance that the 45th World EconomicForum (WEF) held recently in Davos (Switzerland) placed the issue offood security for more than 7.2 billion people in the world to theforefront of its agenda.
This fact clearly shows the increasinglyimportant role that food producers and suppliers play and most notablyhighlight Vietnam’s critically important role in ensuring food securityin the world.
However, despite being one of the world’s leadingagro-forestry-fishery exporters, Vietnam's agriculture revealsweaknesses— low value products at cheap prices, inefficient use of landand natural resources, limited agricultural investment and poor hygieneand food safety.
With the current status of productivity andquality of agricultural products, Vietnamese farmers and businesses arein a pickle to take advantage of the coming golden opportunities absentextensive investment and renovation. Thus, opportunities could be missedand leave Vietnam stagnant, producing low value commodities.
Investors from the Republic of Korea, Australia and Japan are activelylooking for favourable investment opportunities and have embarked on anumber of land lease projects for production, processing and exports inVietnam.
If Vietnamese farmers are off the mark in negotiatingthese agreements they could find themselves simply working as farmlabour for foreign investors, or in other words – they will just beemployees on their soil.
In the face of limited agriculturalinvestment, foreign direct investment (FDI) inflows in agriculture areinvaluable. Therefore it is critically important that these agreementsbe structured in a manner that enables local farmers and agro businessesto team up with foreign investors on an equal partnership basis.
Ona positive note, in recent times, a series of big enterprises acrossmany fields have shifted their investment in the agricultural sector tolarge-scale agricultural projects based on high-tech models which havebrought higher efficiency.
The expanding capital inflows intothe agricultural sector show that sufficient resources to restructurethe sector are available – it’s just a matter of sitting down at thenegotiating table and working out the details.
To this endhowever, businesses need the support of the government and moreincentives to help entice foreign investors to fund land andinfrastructure purchases as well as acquire the necessary technologiesto revamp the agriculture sector.
To call for more agriculturalinvestment, the Vietnam Ministry of Agriculture and Rural Development(MARD) has been working hand in hand with multinational groups toimplement the public–private-partnership (PPP) model.
Additionally,the MARD, last year, drafted a strategy for attracting FDI in the agro-forestry- fisheries sector until 2030 for submission to the PrimeMinister for approval.
Agriculture is the biggest advantage ofVietnam’s economy and it logically follows therefore that agriculturalrestructuring is crucially important in negotiating free tradeagreements. Restructuring is seen as a monumental opportunity that willbenefit the whole national economy.
Successful restructuringwill not only enable Vietnam to become an agricultural power, but alsoserve as a promoter of the industry and service sectors in furtheranceof transforming into an industrialised and modern nation by 2020.-VNA
