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Agriculture sector needs to develop raw materials to reduce dependence on imports



Việt Nam’s agriculture sector needs to focus on developing raw material production and improving processing capacity. — VNA/ Photo Mạnh Minh

HÀ NỘI — The agricultural sector needs to focus on developing raw materials to reduce the dependence on imports as well as improve processing capacity, experts said.

Many agricultural products of Việt Nam saw exports hit billions of US dollars per year but production was still heavily reliant on imported raw materials.

For example, Việt Nam was among the world’s largest cashew exports but still has to import around 80 per cent of raw cashew for processing, mainly from Ivory Coast, Ghana, Nigeria, Guinea Bissau, Benin, Togo, Burkina Faso and Mozambique.

Việt Nam also had to import raw tuna for processing as domestic raw material sources only met 30-35 per cent of demand.

According to Nguyễn Văn Nam, former Director of the Việt Nam Institute of Trade Research under the Ministry of Industry and Trade, globalisation was expanding global value chains, meaning that for just one product, different production stages could be located in different countries, which depended on the capacity of each country.

For the cashew industry, for example, Nam said that while the processing capacity of plants in Việt Nam increased significantly, the production of raw cashew did not expand correspondingly due to limited cultivation land and farmers choosing other plants with higher added value.

This meant that Việt Nam must import raw cashew for production, which was a very normal thing, he said.

However, there would be risks when Việt Nam relied on imported raw materials. The recent Suez Canal blockage heavily affected the import of raw cashew which were mainly from Africa and had to go through this canal. This was an unanticipated risk, he pointed out.

Việt Nam had introduced a number of policies to support agricultural production, including measures to support prices or subsidies directly related to production quantities.

Nam said that under the World Trade Organisation, subsidies were subject to limits with “de minimis” minimal support allowed at 10 per cent for developing countries, including Việt Nam.

However, Việt Nam had not been successful in implementing subsidies support for the agricultural sector due to limited budget and the lack of an appropriate market mechanism.

Nam said it was important to develop comprehensive programmes and strategies to support farmers and agricultural enterprises to enhance their competitiveness, from raw material production to processing capacity as well as distribution.

Focus on processing

Experts said that improving the processing capacity was also essential to increase the added value for agricultural products.

Statistics showed that there were more than 7,500 agricultural processing companies of large scale in Việt Nam with a total capacity of around 120 million tonnes of raw materials per year.

During the past three years, 30 agricultural processing projects were constructed with total investment capital of US$1 billion.

However, the processing capacity of Việt Nam remained low, Bạch Quốc Khang, secretary of the Science and Technology Programme for New Rural Development, said.

Only five to 10 per cent of the output of vegetables and meat were processed per year, Khang said.

The investment in processing was not equal to the development of raw material production, he pointed out.

Under the Prime Minister’s Directive No 25/CT-TTg dated June 4, 2020, Việt Nam targeted to become one among the world’s ten leading countries in terms of agricultural processing and agricultural product trading centres.

To achieve this goal, focus must be placed on improving processing and preservation technology capacity, experts said. —



High logistic costs hinder Delta agriculture exports




High cost of air transport and the inability to preserve fresh produce for a long time are among the logistic challenges that the Mekong Delta is facing. – Photo

MEKONG DELTA – Agriculture exports from the Mekong Delta are facing logistical challenges, affecting their competitiveness overseas.

Đồng Văn Thanh, chairman of Hậu Giang Province People’s Committee, said the Mekong Delta exports millions of tonnes of agriculture products every year but the region is facing many logistical choke-points.

The region is lacking key logistics hubs and storage areas for empty containers and products at ports. Goods have to be transported through many areas before reaching HCM City for export, which increases the cost.

Ngô Tường Vy, deputy director of Chánh Thu Fruit Export and Import Co. Ltd in Bến Tre Province, said that the cost of air transport of fresh fruits to the US and European markets have increased greatly over the years.

For example, the cost for air shipping fresh fruits to the US used to be around US$3.5 per kilo a few years ago, but now has risen to $6 per kilo.

This is affecting their competitiveness overseas and reducing the amount of fruit shipped there.

However, since preservation technology for many fruit products is not good enough, they have to rely on air transport.

The cost of ocean transport of fruit is 15 times cheaper than air, so better preservation technology to maintain quality on longer container trips is important, she said.

Phạm Tiến Hoài, general director of Hanh Nguyen Logistics, said that the logistics costs of Việt Nam’s agricultural products are high, usually accounting for around 30 per cent of their final prices, so they struggle to compete with goods from other suppliers such as China, Thailand and Indonesia.

Võ Thanh Phong, general director of Hậu Giang Maritime Service Co.Ltd , said the Government needs to continue its effort to improve and enlarge waterways in the Mekong Delta so that large vessels can easily travel through different regions, reducing transport time and costs.

Lê Tiến Châu, provincial party secretary of Hậu Giang, said that for 2021 – 2026 the province will invest around VNĐ18 trillion ($777.99 million) to improve traffic infrastructure and region connectivity.

Every year the Mekong Delta accounts for 90 per cent of the country’s rice exports, and 70 per cent of fruit exports. –


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Danang suspends BRT project due to its ineffectiveness



A BRT bus is seen at a bus station in Hanoi. The government of Danang City has decided to suspend its BRT project as the investment in the project has yet to bring about social advantages for the coastal central city – PHOTO: TPO

HCMC – The government of Danang City has decided to suspend its bus rapid transit (BRT) project as the investment in the project has yet to bring about social advantages for the coastal central city.

Huynh Anh Vu, deputy director of the Danang City Management Board of Prioritized Infrastructure Investment Projects, which is the project’s developer and operator, confirmed that the management board had reached a consensus with the World Bank, which serves as the lender of the project, on its suspension.

Instead, the management board will focus on completing works related to the development of subsidized bus routes in the city, Vu said, as reported by Lao Dong newspaper.

The decision is considered as the right move as the city’s transport infrastructure system still remains inadequate and measures taken to encourage the use of public means of transport among local residents have not proved effective.

The move was strongly backed by the locals and some of them cited the examples of other localities where trillions of dong were poured into BRT projects but they had failed to address traffic congestion and caused losses to the State budget.

In 2013, the Government approved a master project to develop Danang sustainably with five components: improving the rainwater and drainage system, piloting the BRT system, developing key urban roads, enhancing the capacity and supporting the execution of projects and works transferred from prioritized infrastructure investment projects.

The master project was expected to be completed in June this year, but it has been 84% complete to date with US$185 million spent. Specifically, the BRT project has been 33% complete, while the remaining components have basically been finalized.


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Some coastal hotels report full occupancy as tourists are on the rise



Tourists play outdoor games at a resort. Many hotels in Ba Ria-Vung Tau Province have reported full occupancy as the number of tourists is on the rise – PHOTO: LDO

HCMC – Many hotels in Ba Ria-Vung Tau Province have reported full occupancy as the number of tourists is on the rise, though the holidays of April 30 and May 1 are still a while away, signaling good news for the tourism sector.

Nguyen Van Tuan, manager of Long Hai Hotel in Ba Ria-Vung Tau Province, told Lao Dong Online that over the past one year, the hotel saw few guests and its highest occupancy rate at a mere 20%. However, for some days last week, the number of tourists who booked rooms at the hotel surged, with the occupancy rate at 90%.

For April 17 and 18, the hotel is fully booked, and it is the first time since the coronavirus pandemic that the hotel is seeing some 100 rooms in total fully booked, Tuan said, adding that the hotel was fully booked three weeks ago for the Reunification Day, April 30.

Last weekend, many guests fully booked rooms at Vietsovpetro Ho Tram, said a representative of the resort.

Many hotels at sea tourist destinations near HCMC such as Ho Tram, Long Hai, Vung Tau and Mui Ne are seeing the number of guests soar on weekends.

Do Van Thuc, deputy director of Dat Viet Tour, said that the firm had received rising tour bookings on weekends.

Recently, Dat Viet Tour has been seeing an average 1,500 guests book weekend tours to the sea each week, some 200 kilometers from HCMC, he said.

Apart from this, since March, when the coronavirus outbreak was brought under control in Vietnam, Alo Limo, a transport firm, has become busier on weekends, said Le Gia Thanh Tam, a representative of Alo Limo.

Over the past few weeks, each week has seen some 10-15 groups of tourists book limousines for their trips, mainly to Dalat, Phan Thiet and Vung Tau, Tam said.


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