According to Vietnam's Director of the Institute of Policy and Strategy for Agriculture and Rural Development (IPSARD) Nguyen Do Anh Tuan, Vietnam needs to promote hi-tech agriculture, as a means to improve food production quality and efficiency.
“Science and technology applications in agricultural production need the engagement of not only the state and scientific research organisations, but also the participation of farmers and businesses. In fact, businesses play a growing role in raising the sector’s technology level while increasing farmers’ access to hi-tech applications,” Tuan said, adding that businesses’ engagement in agriculture could help tackle problems with capital and output markets for agricultural products.
Based on this theory, a raft of investment incentives for hi-tech agriculture was introduced. The project to develop hi-tech agriculture by 2020, approved by the prime minister in 2010, awarded the highest incentives applicable to research and development activities to promote hi-tech agriculture, train workers, and support the development of hi-tech agricultural businesses.
Thus far, a number of cities and provinces have become desirable destinations for hi-tech agricultural businesses, such as Ho Chi Minh City, Lam Dong, Vinh Phuc, and Quang Ninh.
According to Deputy Chairman of the Quang Ninh People’s Committee Dang Huy Hau, in light of the agricultural sector’s five-year restructuring plan with a vision to 2030, science and technology will lay the groundwork to create breakthroughs in development. This is a signal for the participation of businesses from assorted economic sectors to enter into the restructuring process. These businesses will be a central factor in the process, creating spill-over effects linking farmers and from there spurring production.
Most recently, Quang Ninh has invested intensively into developing a hi-tech agricultural zone in the province’s Dong Trieu district.
The province’s efforts were duly rewarded. Vietnam’s leading private group Vingroup is carrying out the first phase of a VND650 billion ($29.8 million) hi-tech agricultural centre project on 43 out of 200 hectares, producing about 20 types of vegetables and fruit that comply with VietGap standards.
The initial output is from 2.5-3 tonnes per day for supply to its VinMart system, helping to generate jobs for nearly 200 local labourers. The project employs cutting-edge technologies from Japan, Israel, and South Korea to ensure products meet VietGap, GlobalGap, and organic food standards. They are striving to shape a hi-tech agricultural production zone with the centre for procuring, processing, product preservation, and technology transfer located in Dong Trieu district’s Hong Thai Tay commune.
Vietnam has tremendous potential for hi-tech agricultural development, which explains why many leading local groups such as Vinamilk, TH True Milk, and Duc Long Gia Lai have all ventured into the sector. In fact, according to Tuan, a slew of foreign investors have made forays into Vietnamese agriculture.
According to national targets, by 2020 Vietnam will be home to 200 hi-tech agricultural businesses and 10 hi-tech agricultural zones. However, according to general secretary of the Association of Hi-tech Application Agricultural Enterprises Ngo Tien Dung, Vietnam currently only reports 22 hi-tech agricultural businesses out of thousands of agricultural firms. That was because companies face numerous difficulties in capital and investment incentives, while this field is capital-intensive and requires a long time to recoup seed funds.
Experts therefore suggest attracting investment into agriculture by promoting a public-private partnership model, as applied by Quang Ninh. The province’s results have thus far been encouraging. Under this model, the state sets out standards and implements concrete policies to encourage businesses to use technological advances in agriculture. The government also plans agricultural production zones and clarifies its policies for farmers and businesses. Cities and provinces can work closely with businesses during project implementation to clear space, convince local residents to support businesses, and establish hotline channels to help firms tackle impediments.