17:26 | 08/05/2015 Trade
Vietnam’s economy faced increased downward pressure – especially in agriculture, forestry and aquatic product exports – in the four months leading up to May, according to officials at the Ministry of Industry and Trade (MoIT).
Governmental agencies and the business community must stand up to the downward pressure and implement far-reaching measures to modernize and improve product quality, the MoIT said to avoid a negative impact on employment and incomes.
In the January-April period, the export markets have hiccupped but are in line with expectations and should rebound in the remaining months of the year an official of the MoIT said, adding that downward pressure will persist unless concerted remedial actions are undertaken.
The official called for speeding up reforms in the nation’s rice industry – a centrepiece to the agricultural industry – to reach its full potential, a market that has been stymied and lagging in growth.
The rice industry continues to suffer from poor transport and infrastructure such as roads, railways, warehouses and handling equipment due to the industry’s inability to attract foreign investment, he said.
Huynh The Nang, general director of the Vietnam Southern Food Company (Vinafood II) in turn noted the African market has a great demand for white and jasmine rice but the industry’s ability to fill that demand has been hampered by a lack of modernized equipment.
If the industry was equipped with state-of-the-art milling systems it could readily meet Africa’s and the international community’s high quality standards Nang said.
Nang called for the timely launch of major infrastructure projects in transport and water conservation with the support of financial institutions and the government to reduce costs and thereby increase profits and develop a sustainable industry.
The country needs a plan that focuses on the whole chain—looking at how much farmers will get, how much millers will benefit, and how much exporters will get, based on top dollar global market prices, Nang stressed
Most importantly, the country must tap new markets and the industry must act in concert to proactively implement effective and targeted marketing campaigns to promote trade and develop a national rice brand to increase competitiveness in the world rice market
In the short-term rice faces an oversupply compounded by fierce price competition from Thailand and India but he added that the long-term solution is for the industry to migrate towards higher quality rice varieties, such as premium jasmine rice, to ensure output that meets the strict requirements of demanding markets.
Deputy Minister of Industry and Trade Tran Tuan Anh said the Government and MoIT should take drastic measures to help businesses speed up exports and create the most favourable conditions to improve the quality of rice exports.
Too many farmers still use chemical pesticides with cheap, poor-quality seeds — practices the government is working to change through education.
Trust within all sectors — from farmers to millers and exporters — is not strong enough yet, he said. We have to figure out ways to make businesses trust each other. This is the main obstacle we are facing. When the industry has quality rice, it receives a good price.
Furthermore, the MoIT should direct trade offices abroad to support the development of market, and establish a working group to timely deal with difficulties for export businesses in all sectors of the economy.
At first, the MoIT should take concrete measures to reduce production costs and control input costs to improve competitiveness and profitability of export products adding that secondary focus should be placed on simplifying tax and customs formalities.
For his part, Vietnam Association of Seafood Exporters and Producers (VASEP) Deputy General Secretary Nguyen Hoai Nam said to promote exports, especially seafood products, trade promotion activities should focus on key markets and major industries.
Nam emphasized the important role of commercial trade councillors to represent Vietnam domestic businesses abroad and provide advice on trade issues related to market.
He added that commercial councillors should serve as an important bridge in speeding up agro-forestry and aquatic exports.
Source VOV News