VIETNAMESE DISCUSSANT

Transcription

1 MINISTRY OF AGRICULTURE AND RURAL DEVELOPMENT VIETNAMESE DISCUSSANT Tran Kim Long Director General of International Cooperation Department Paris, 03 May 2017

2 The Role of Agriculture in Vietnam Remaining a key driver in socio-economic development; Contributing 20% of export value and GDP; The world s leading exporters of several key agro-food commodities, of which 10 products with export-turnover exceeded 1 billion USD; Creating jobs: Rural workforce accounting for 60-70% of the total labor force; Agricultural labor: 43%; 70% of the population living in rural areas; Managing most of natural resources: land, water resource, minerals, etc...

3 Opportunities of Agriculture in Vietnam 1. Enhancing food security and sustainable agriculture development to respond climate change. Five priorities have been identified: - Resolve the relationship between food security and climate change; - Sustainable management of natural resources; sustainable rural-urban development; - Trade and investment facilitation in the agriculture sector and access to food markets; - Harmonizing food safety standards and control food waste. 2. Deeply integrating in global and regional economy; signed many multilateral and bilateral FTAs: that open international market access for agro-food products as well as investment flows (FDI and PPP) and high-techs for the sector; 3. The sector is moving forward to foster the comprehensive and sustainable agro-food value chains to increase value added of agro-food products; ensure food safety and link in global value chains. (MARD in co-ordination with Grow Asia Forum, WEF and 15 Global International Corporate has been established 08 PPP Task Forces to improve production, value added of agro-food products; maintaining market stability; food safety and quality of some key agricultural commodities in Vietnam. The purpose is 20% productivity increased; 20% income increased and 20% GHG reduced by 2020).

4 Challenges of Agriculture in Vietnam Supply-chain uncertainty Demand uncertainty Climate change; diseases.. adversely affect productivity, food production, which lead to supply & demand imbalances, price instability; Low production growth rates of commodities; low agricultural income sources; qualified young labour tends to leave agriculture sector that hard to create a stable and quality supply; The policies of agricultural subsidy and price support from rich nations distort the market signals; The supply sources relying on policies of several Big Nations, such as the United States, China, India, Brazil, etc, is unpredictable, that affects the global supply; CHALLENGES Many countries, especially the Big Nations, tend to embrace agricultural trade protection through the application of increasingly strict non-tariff measures and technical barriers, subsidies, temporary storage and distorting agricultural trade; The use of macro-economic tools to stimulate growth and exports of the countries (for instance the use of exchange rates, interest rates); increasing forms of domestic support to agricultural sector, especially by the emerging economies could generate an impact on the import and export prices of agricultural commodities;

5 Challenges of Agriculture in Vietnam Supply-chain uncertainty Demand uncertainty Limited land to expand production; high agricultural labour costs; agricultural growth has increased pressure on natural resources, constraining production growth (OECD 2017); Limited investment in processing and value added production lead to low competitiveness of agro-food products at the global markets; Weak integration among the chain actors and bottlenecks in agro-food value chain development: + High cost inputs: wrong kinds; high price and volatile; overuse of fertilizers, pesticides; scare water; + Inefficient and low quality production: small-size and fragmentation; lack of coordination; wrong technical process; overuse of cheap labour; inefficient irrigation; quality inconsistency; CHALLENGES The instability of agricultural prices encourages the financial investment in transactions of agricultural products; this in turn boosts agricultural price volatility; Producers in developing countries are not able to meet changes in demand, tastes and preferences of the consumers in terms of quality, variety and brand along with working standards and environment; Food safety to meet global standards as well as higher requirements from importing countries

6 Challenges of Agriculture in Vietnam Supply-chain uncertainty Demand uncertainty + Postharvest is high transaction cost and high post - harvest losses: Arm s length transaction; many layers of intermediary; weak storage; weak packaging and transportation; + Processing is low tech and low value added: Small-size and fragmentation; high losses; lack of refined and deep processing; lack of by product processing + Export is low quality and low price, due to: Poor quality management; lack of market information; poor branding. CHALLENGES

7 Challenges of Agriculture in Vietnam Supply-chain uncertainty Demand uncertainty Climate change; diseases.. adversely affect productivity, food production, which lead to supply & demand imbalances, price instability; Low production growth rates of commodities; low agricultural income sources; qualified young labour tends to leave agriculture sector that hard to create a stable and quality supply; The policies of agricultural subsidy and price support from rich nations distort the market signals; The supply sources relying on policies of several Big Nations, such as the United States, China, India, Brazil, etc, is unpredictable, that affects the global supply; CHALLENGES Many countries, especially the Big Nations, tend to embrace agricultural trade protection through the application of increasingly strict non-tariff measures and technical barriers, subsidies, temporary storage and distorting agricultural trade; The use of macro-economic tools to stimulate growth and exports of the countries (for instance the use of exchange rates, interest rates); increasing forms of domestic support to agricultural sector, especially by the emerging economies could generate an impact on the import and export prices of agricultural commodities;

8 Challenges of Agriculture in Vietnam Supply-chain uncertainty Demand uncertainty Limited land to expand production; high agricultural labour costs; agricultural growth has increased pressure on natural resources, constraining production growth (OECD 2017); Limited investment in processing and value added production lead to low competitiveness of agro-food products at the global markets; Weak integration among the chain actors and bottlenecks in agro-food value chain development: + High cost inputs: wrong kinds; high price and volatile; overuse of fertilizers, pesticides; scare water; + Inefficient and low quality production: small-size and fragmentation; lack of coordination; wrong technical process; overuse of cheap labour; inefficient irrigation; quality inconsistency; CHALLENGES The instability of agricultural prices encourages the financial investment in transactions of agricultural products; this in turn boosts agricultural price volatility; Producers in developing countries are not able to meet changes in demand, tastes and preferences of the consumers in terms of quality, variety and brand along with working standards and environment; Food safety to meet global standards as well as higher requirements from importing countries

9 What will we do to reduce risks and develop a sustainable, effective and security food system and global agro-food value chain 1. Developing information sharing mechanisms about supply and demand forecasting of some key agro-food commodities among countries; 2 Liberalizing trade; eliminating subsidies and price supports; promoting partnership among companies of agriculture commodity exporters and importers; 3 Promoting food & nutrition security. Harmonizing and committing to implement standards; SPS measures; food safety; quality and environment protection; 4 Promoting investment in the form of Public-Private Partnership (PPP) in order to build up competitive, inclusive and sustainable agro-food value chains: (i) supporting finance to build the chain; (ii) applying cost-sharing mechanisms between the actors; (iii) developing norms and standards, traceability systems for food safety, quality, environment and sanctions for the parties to comply; (iv) increasing the value added and competitiveness of agro-food products on the international market; 5 Developing and strengthening the risk management system in agricultural production. Consolidating and strengthening the social security system, especially for poor farmers; 6 Developing and implementing the strategy for green agriculture development and "No Regrets" strategy of climate change adaptation (timely informing, focusing on research and technological solutions for adaptation, supporting crop diversity, developing ecosystem services policy, encouraging water saving, improving infrastructure to minimize water loss, restoring mangroves, developing integrated coastal management, etc). Applying the model of green agriculture with ecological certificate (low carbon certificate) in order to increase the value added and competitiveness of agro-food products on the international market.

10 Thank you for your kind attention!