Bleak prognosis for agriculture

Viet Nam’s agricultural sector was likely to encounter challenges caused by the impact of climate changes and technical barriers erected by many importing countries this year, a Government deputy minister has warned.

Deputy Minister of Agriculture and Rural Development Luong Le Phuong told a conference on Viet Nam’s agricultural outlook in HCM City yesterday, May 13, that the worsening drought caused by climate change and saltwater intrusion in many places were already causing problems for agricultural production and the situation would become more serious.

Dang Kim Son, director of the Center for Agricultural Policy, said trade barriers were likely to go up in many markets.

Major markets like the US and Japan were likely to increase quality and sanitary requirements for agricultural products, especially pepper, honey, aquaculture, to protect domestic goods, he said.

Exports to the EU had to comply with complicated illegal, unreported and unregulated, or IUU, fishing regulations.

The global agricultural market was expected to be volatile this year due to the impact of financial markets and forex policies, not because of any imbalance in supply and demand, delegates said.

At home, the unfavourable weather could reduce food production, causing famine in some areas, they warned.

Holger Matthey of the Food and Agriculture Organization’s Trade and Market Division said: “Average crop prices in the next 10 years are projected to be above the levels of the decade prior to the 2007/08 peaks, based on a higher cost structure, particularly in regions where energy inputs are used intensively.

“Global agricultural production is anticipated to grow more slowly in the next decade than in the last, with the growth led by Latin America and Eastern Europe, and to a lesser extent by certain countries in Asia.”

Developing countries would drive growth of world agricultural consumption and trade, he said, adding their demand is driven by rising per capita incomes, urbanisation, and population growth.

Son said there would be a scarcity of raw materials and energy that would push their prices higher.

Real situation

Despite the global economic downturn, the agro-forestry and fisheries sectors achieved growth of 3 per cent last year, Phuong said.

Poor forecast of markets and a lack of guidance for farmers had caused prices of agricultural products to fluctuate violently – down at times of high supply and up when farmers did not have crops to sell – he said.

Trinh Minh Anh, deputy director general of the National Committee for International Economic Co-operation, urged enterprises and farmers to carefully research markets, keep production flexible, and strengthen competitiveness by applying advanced technologies and co-operation.

“Enterprises should study the laws and regulations of importing countries carefully before exporting and take advantage of incentives,” he said.

He exhorted policy makers to review agricultural policies to help the sector develop.

Vo Tri Thanh, deputy director of the Central Institute for Economic Management, said: “Since Viet Nam is still a transitional economy in transition, the key issue is to improve institutional capacity, socio-economic infrastructure, and international linkages to take full advantage of arising opportunities.”

Viet Nam News

Tags: Vietnam agriculture