17:31 | 21/03/2016 Economy- Society
(VEN) - Many large companies have expressed an interest in agricultural investment, which has made a significant contribution to domestic agricultural development. However, many firms are discouraged by currently unfavorable investment mechanisms and policies.
Domestic agricultural businesses want more preferential treatment
Unfavorable investment mechanisms and policy remain
At a meeting of the agricultural and rural investment attraction panel on February 19 in Hanoi, Dr. Dang Kim Son, Former Director General of Institute of Policy and Strategy for Agriculture and Rural Development (IPSARD) under the Ministry of Agriculture and Rural Development said, “Many corporations including Vingroup, FPT and Viettel have been implementing agricultural investment projects. However, the sector still needs more.”
An IPSARD’s report reveals that 72 percent of agricultural businesses questioned said that they wanted the government to continue administrative reforms, especially streamlining agricultural and rural investment procedures to facilitate agricultural business development.
A recent World Trade Organization’s report on agribusiness facilitation showed that Vietnam just ranks before Laos, Cambodia and Myanmar in Southeast Asia, with less tax preferential treatment. For example, coffee exporters find it difficult to get VAT refunds.
The role of agricultural businesses should be revised
According to General Director and President of the Intimex Group JSC Do Ha Nam, domestic agricultural businesses are mainly engaged in low-tech agricultural processing as few can afford to invest in a US$20 million hi-tech processing plant while several other firms have ventured to invest but later sold foreign investors their plants on account of high immediate profits. Some domestic agricultural businesses wanted to expand production but have failed to implement growth due to the minimal levels of support mechanisms and policies. “The Ministry of Agriculture and Rural Development should prepare agricultural investment models and announce which agricultural segments and products will benefit from any incentives, to gradually improve the role and contributions of domestic agricultural businesses.” Nam said.
According to Nafoods Group Chairman and General Director Nguyen Manh Hung, the Ministry of Agriculture and Rural Development should devise an agricultural development strategy to help domestic agricultural businesses sustainably develop.
Economist Pham Chi Lan also suggested that agricultural policy makers should further streamline administrative procedures and offer domestic agricultural businesses more preferential treatment.
Vietnam Institute of Economics Director Tran Dinh Thien said, “It’s time to revise the role of domestic agricultural businesses that should be key for domestic agricultural development in the context of increasing international integration.”