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How can the country restructure its agriculture production system?

Update: March, 03/2014 - 09:11

Restructuring is the only way for the agriculture sector to remain competitive, yet there is much work to be done, Nguyen Van Bo, director of the Agriculture Science Institute, told Thoi bao Kinh te Viet Nam (Viet Nam Economic Times).

What are your biggest concerns about the ongoing structural reform of the agriculture sector?

I think that the agriculture sector has been subjected to many criticisms for its poor performance. Although some of the fault actually belongs to other sectors, we have to share the responsibility with them. If we want to make the reform a success, the first thing we must do is judge the development of agriculture –our country's primary industry.

There are various factors leading to our sector's poor performance. But here I only want to mention one key factor - the loose linkage between production and commerce. The benefits that go to producers are not on par with their investment. Enterprises simply collect the products and export them. When exports are enjoying smooth sailing, the praise goes to the trade sector. But when exports are poor, the blame goes to the agricultural sector, particularly the scientists, who are blamed for producing low quality seeds that are not good for export.

What are the next steps that the agriculture sector should adopt to continue the reform?

Based on lessons learned in the past few years, we think there are three things that the sector should do.

First, adjusting the crop structure following our country's comparative advantages, such as climate. At the same time, we have to try to create a large production area which closely links production with product storage, processing and trading in order to bring high benefits to farmers.

If we go along this path, there are some points we should pay attention to. Due to the fact that most of our agricultural products are for export, we should understand the market size. This is very important for production scope and scale. In addition, Viet Nam should invest more in growing vegetables, fruits, maize and other plants which we can grow well. As for industrial crops, in my opinion, we should focus our investment in extensive processing while utilising our climatic factor to develop special agricultural products not grown in other countries.

In parallel with these activities, we should develop agricultural tourism.

The development of this type of tourism will help us promote our agricultural products as well as Vietnamese ingredients and cuisine.

Second, improving the added value of our agriculture products through the reduction of post harvest loss and extensive processing, diversifying products to meet market demand and creating new brand names while trying to lower the price of our products.

And finally, improving the nutrient structure in our people's diet while encouraging people not to waste food.

People say there are quite a lot of risks in crop restructuring, and we still lack direction in that area. How do you respond?

I couldn't agree more. One of the key reasons is that for many years, our policy has focused on increasing food volume. We have created rice species with high productivity and fat pigs, among other products. Consequently, our agricultural production is not sustainable.

Nowadays, we are encouraging the farmers to adjust their crop production. If we want the farmers to follow our advice, it is imperative to ensure positive change. I think that the farmers want to know who is by their side when they decide to grow new crops and who will share the risks with them. More importantly, they want to know who will teach them the new production techniques and then help them commercialise their products.

Creating added value products has been a headache for the agriculture sector for many years. Do you have any initiative to solve this problem?

In my opinion, we should focus on the following activities.

First, giving priority to conservation activities and reduction of post harvest loss. If we can reduce post harvest loss by just 50 percent, we can gain benefits equivalent to increasing the crop acreage by 10 percent. The next step is to invest in deep processing for products with comparative advantages, including coffee, tea, pepper, cashew nuts, cassava and even rice.

The work of developing and promoting trademarks as well as establishing new markets should receive more attention and investment. Ironically, we have used quite a few foreign products made with Vietnamese raw materials. I'm sorry to say we are not very good at promoting our agricultural products.

In addition, our production cost at present remains very high, particularly the raw materials and labour. It's no longer true that we have comparative advantages of low labour cost and rich natural resources. Furthermore, we now have to import a large percentage of materials including fertiliser and plant protection chemicals. It is high time for Viet Nam to improve investment efficiency and cut production costs. — VNS


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