Ample room for export of high-quality agricultural products to EU

July 21, 2022 - 08:35
Việt Nam News spoke to Phùng Đức Tiến, Deputy Minister of Agriculture and Rural Development (MARD), about the opportunity to export high-quality agricultural products between the two markets.

Deputy Minister of Agriculture and Rural Development Phùng Đức Tiến

The European Union (EU) is Việt Nam's leading trade partner, while Việt Nam is a potential and safe investment destination for European businesses. After nearly two years of implementing the EU-Việt Nam Free Trade Agreement (EVFTA), despite challenges caused by the COVID-19 pandemic, the trade pact has shown its importance in helping two-way trade between Việt Nam and the EU increase by 14.8 per cent and the EU’s exports to Việt Nam rise by 16.5 per cent.

Việt Nam News spoke to Phùng Đức Tiến, deputy minister of Agriculture and Rural Development (MARD), about the opportunity to export high-quality agricultural products between the two markets.

How do you evaluate the cooperation between Việt Nam and EU in the agricultural sector?

The EVFTA took effect in August 2020 and despite being affected by COVID-19, Việt Nam’s agricultural exports to the European market increased rapidly from over US$4.5 billion in 2020 to $5.2 billion in 2021. The figure in the first five months of this year was $2.26 billion, up 26 per cent year-on-year.

The EU is a large import market for Việt Nam's key agricultural products such as pepper, seafood, cashew nuts, wood and wooden products. From our side, Việt Nam imports agricultural materials and equipment, livestock products and raw materials for animal feed from the EU. The export products of the two sides are complementary and not competitive.

There’s still a lot of room to promote trade in the agricultural sector between the two markets. Việt Nam has advantages in agricultural production and export. We’re among the top 15 exporting countries of agricultural, forestry and fishery products in the world with an export turnover of $48.6 billion in 2021 and an expected $55 billion this year.

With comparative advantages in agricultural production along with a stable macro-economic environment, a large-scale domestic market with nearly 100 million people as well as being the gateway to the Southeast Asia market with 650 million people, Việt Nam has attracted many large and well-known EU agricultural corporations such as Bayer (Germany); De Heus, Nutreco (the Netherlands); Nestlé (Switzerland); Ceva, Virbac (France). However, the total number of FDI projects and capital of EU enterprises in Việt Nam's agricultural sector is still modest with 44 projects worth more than $200 million.

What are the new pushes that Việt Nam needs to make our agricultural products more accessible to the EU market?

Last week, a European business delegation of 50 high-ranking representatives visited Việt Nam and had meetings to seek cooperation opportunities with Vietnamese enterprises in fields of mutual strength. They went on a field trip to learn about the work of Vietnamese farmers, raw material areas, preliminary processing, traceability and commercialisation of products in the EU market, especially organic products in Việt Nam.

I totally agree with European Commissioner for Agriculture Janusz Wojciechowski, saying that “seeing is believing” and his first working trip to Việt Nam since the adoption of the EVFTA created the foundation for a new development period. The two sides will promote information exchange to unlock development potentials and the growth of Vietnamese agricultural exports to the European market.

Facing climate change challenges and the risk of global food insecurity, Việt Nam's agriculture industry is robustly transforming towards green growth, developing a multi-value integrated growth model towards high technology, diversity and sustainability, rational use of natural resources, protection of the ecological environment, maintenance and conservation of biodiversity.

Việt Nam is building a transparent, responsible and sustainable agricultural sector. Especially, amid global supply chain disruptions and rising food prices, Việt Nam is actively participating in the global food chain with a production capacity of nearly 44 million tonnes of rice, of which exports reached 6.7 million tonnes.

Việt Nam wishes to expand its exports of rice, vegetables, coffee, processed products and products with geographical indications in the EU.

The EU is a "fastidious" market, demanding high-quality agricultural products. What will the ministry do to support businesses to unlock this market?

Việt Nam and the EU have established official diplomatic relations since 1990, right after Việt Nam embarked on its economic renewal policy. After more than 30 years of establishing diplomatic relations and 10 years of signing the Việt Nam-EU Comprehensive Partnership and Cooperation Framework Agreement, the relationship between the two sides is developing rapidly and comprehensively with many positive results.

The two sides have built a solid cooperation framework with many important agreements and effective cooperation mechanisms. The EVFTA is a very important trade-investment cooperation framework that opens up great opportunities and prospects in the bilateral relationship.

Trade ties in the agricultural sector have also continuously improved in recent years. Especially after the EVFTA came into effect with many tax incentives, many Vietnamese enterprises and organisations have promptly and creatively caught up with the world technology which enables them to meet the strict standards of the European market.

The ministry will review each specific item and closely monitor market developments in association with production re-organisation and agricultural restructuring to further grasp opportunities in this market.

With the European business community, what do you expect in agricultural cooperation in Việt Nam?

We consider the EU a leading trade partner, a great, traditional and potential market for Vietnamese agricultural products, especially when the new-generation EVFTA came into effect, opening up trade opportunities in the agriculture, forestry and fishery sector. The ministry is ready to work closely with the EU to facilitate trade, ensure technical standards according to international practices, and not create new trade barriers without sufficient scientific basis for the benefit of producers, businesses and consumers on both sides.

Việt Nam welcomes the EU's new projects to support agricultural development in the country and wishes to attract more FDI projects into the agriculture sector. Areas of focus for development are agricultural knowledge, ecological, circular and organic agriculture, especially high technology and core source technology.

Some cooperation contents are very important such as training human resources, building regional clusters of industry links associated with large specialised farming areas, processing, diversifying products with high added value and developing trade and logistics infrastructure serving agricultural value chains.

At the same time, Việt Nam wants to mobilise more resources from the EU to help soon complete the legal timber control system and enhance the fight against illegal fishing at sea. The ministry will accompany and create favourable conditions for EU businesses to make successful, long-term and sustainable investments in Việt Nam. — VNS