WTO proves mixed blessing for local farmers

World Trade Organisation (WTO) membership has brought mixed blessings for the country’s agricultural sector, according to officials.

Ho Xuan Hung, deputy minister of Agriculture and Rural Development, said the sector had progressed well because it had updated its technology to be globally competitive.

Thanks to WTO membership, exports of farm produce had increased, Hung said, adding that export earnings had rose significantly in recent years, reaching US$19.2 billion last year, an increase of 22.6 per cent over 2009.

Las year, the country had 18 items each reaching export revenue of $1 billion or more, six of which were in the agricultural sector, including rice, pepper, cashew and tra fish.

However, many industry experts said after four years of WTO membership, the country’s capacity still remained weak in building brands.

In addition, local businesses had not worked well with one another, and there was still unhealthy competition among them.

After joining the WTO, the country’s farm produce exports encountered technical barriers, antidumping duties and lawsuits imposed by importing countries.

Due to lower import tariffs, foreign produce had penetrated the domestic market, causing difficulties for locally grown items.

In the 2011-15 period, most protective measures for the agricultural sector will be gradually abolished due to the WTO commitments, which will put pressure on the prices of locally grown produce, both in foreign and local markets, according to Tran Thi Mieng, deputy head of the Department of Agro-Forestry Products Processing and Salt Industry.

However, Hung said the Government would continue to support the sector because of such risks, particularly those of the weather.

“Even a big country like the US still offers many subsidies for its farmers,” he said.

But the Government would not offer direct support, only indirect support, including investment in infrastructure and human capacity, and training farmers in production and marketing skills.

The country had been relying on its cheap labour force to make agricultural products competitive in export markets. This would not be sustainable in the long term for the country to develop further, he said.

Improvement in processing technology and the value added to agricultural products, along with better quality, processing and a wider variety of products, would help the agricultural sector become more competitive.

In addition, improvements in hygiene standards, food safety, trademarks and distribution were also very important to develop the sector in a sustainable manner. — VNS

Tags: Vietnamese farmers