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Vietnam Today

Just 1% of enterprises in agriculture

Released at: 21:11, 15/04/2015

Just 1% of enterprises in agriculture

VCCI report shows agriculture enterprises just a tiny proportion of country's total.

by Nguyen Quynh

The Vietnam Business Annual Report 2014, released by the Vietnam Chamber of Commerce and Industry (VCCI) on April 15 at the Forum on Enterprises Development in Agribusiness showed that only 3,500 enterprises are involved in the agricultural sector, or just 1 per cent of all enterprises in the country.

Addressing the conference, Mr. Vu Tien Loc, Chairman of VCCI, said that the agriculture sector contributes 20 per cent of Vietnam’s GDP but the 1 per cent of enterprises operating in the sector is tiny compared to its development potential.

The report also indicated that Vietnam’s agriculture sector is primarily of household scale, with most enterprises being small and medium sized. Except for State corporations and a few foreign invested enterprises (FIEs), most agricultural enterprises are micro enterprises with low competitiveness.

Production chains are therefore considered an important model for promoting the development of Vietnam’s agriculture sector and enterprises are an important link in the chain, according to Mr. Loc. “It is necessary to establish close relationships between enterprises and farmers,” he said. “Enterprises need to support farmers in lending as well as in ensuring input and output. Such links are important for bolstering Vietnam’s agriculture sector.”

Deputy Minister of Agriculture and Rural Development Ha Cong Tuan, meanwhile, said that the government needs to have strong policies to attract more foreign businesses to invest in the agricultural sector. “Foreign companies will operate in a fair playground with domestic enterprises,” he said. “The State, therefore, should have policies that support small and medium-sized enterprises and encourage FIEs to invest in agriculture.”

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