New-style cooperatives, the extended arm of farmers

Minister of Agriculture and Rural Development Nguyen Xuan Cuong

How do you assess the building of the linkage chain?

Vietnam’s production capacity is very large. Each year, Vietnam produces 5.5 million tonnes of meat, 30 million tonnes of fruit and vegetables, 45 million tonnes of food and millions of tonnes of coffee. However, the biggest weakness is a lack of linkages between production, processing and market organization. Therefore, it is necessary to establish cooperatives, which are considered key to linking businesses and farming households.

Promoting linkages is an urgent need based on the voluntary effort of cooperatives, businesses and farmers to create mutual benefits for all sides, while creating favorable input and output services with competitive prices.

What policies have been adopted to develop cooperatives?

The government issued Decree 98/2018/ND-CP on encouraging the development of cooperation and linkage in the production and consumption of agricultural products, and Decision 461/QD-TTg on approving the development of 15,000 cooperatives and cooperative alliances with effective operation up to 2020.

The Ministry of Agriculture and Rural Development has cooperated with the Vietnam Cooperative Alliance and the Vietnam Farmer’s Union to adopt a specific action program. Accordingly, they will focus on maintaining, consolidating and improving operational efficiency of about 4,400 agricultural cooperatives evaluated as effective in 2017 and step up high-tech application in over 1,500 agricultural cooperatives. Under the action program, they will also improve quality of cooperatives’ activities, striving to have more than 5,400 agricultural cooperatives operating effectively, and establishing and facilitating 5,200 agricultural cooperatives to operate effectively.

Cooperatives should act as a nucleus to connect more than 8.6 million farming households with large businesses to create a closed production cycle, resulting in higher agricultural value chains.

What is the reason for ineffective cooperatives?

About 70-80 percent among 12,000 current cooperatives were transformed from old models in accordance with the 2012 Law on Cooperatives. Some 35-40 percent of these perform are relatively well, while the rest need to change their thinking.

It is important that 30 percent of cooperatives formed correctly according to the requirements of the 2012 Law on Cooperatives are operating effectively. They have helped standardize products being produced in the chain, applied high-tech and enabled the determination of product origin.

What is the direction of the Ministry of Agriculture and Rural Development for newly established cooperatives?

A change of awareness is required in order to ensure the success of cooperatives. The new models require farmers to choose their leaders by themselves. The leaders must then create a management model, and members are those who will decide their success.