The GDP growth of 7.08 per cent in 2018 is an impressive figure ($US 2,587 per capita); despite slowing global trade due to geopolitical tensions and the US-China trade war. The Vietnamese economy continued to record a variety of notable achievements. Vietnam’s macroeconomic foundations were maintained, with inflation contained at 3.6% and core inflation remaining stable below 1.5%, while major balances of the economy were guaranteed. Vietnam exports since 2018 have become more sophisticated with an impressive diversification of exports and increases in higher-value manufacturing. It accounted for about 85 per cent of total exports, up from 65 per cent in 2010, driven by dynamic growth in the export-oriented foreign sector.

Agriculture's share of economic output has continued to shrink from about 20% in 2016 to 16% in 2017. Total agricultural value in 2018 increased 3.86% as compared to 2017; including crop products of 2.91%, husbandry of 2.16%, forestry of 6.01% and fishery of 6.46%.

The export turnover of agriculture obtained $US 40.02 billion (9.56% increased – a new record); including agro-products, husbandry products, aqua-products and processed wood & furniture products of  $US 19.516, US$ 0.546, $US 9.013 and $US 9.346 billion, respectively.

The conversion of rice cultivated areas with low economic efficiency into other crops, fishery, orchards, etc.. was recognized as 105 thousand ha.

Rice growing areas developed 7.57 million ha (134,000 ha decreased) with rice production of 44 million T (1.24 million T increased) and average yield of 5.81 t/ha (0.26 t/ha increased). The milled rice export of 6.10 million T (4% increased) obtained the turnover value of $US 3.10 billion (15.3 % increased) including white long grain rice, aromatic rice, glutinous rice and japonica rice of 51%, 32%, 12% and 5%, respectively.

Maize growing area is 1.039 million ha (94% decreased) with average yield of 4.67 t/ha (0.8% increased). Total maize production gained 4.90 million T (4% decreased).

Vegetable areas increased up to 961,000 ha (23,300 ha increased) with the production of 17.1 million T (622,400 T increased) and productivity of 17.60 t/ha (0.19 t/ha increased).

Fruit orchards developed 950,100 ha with the production of 8.8 million T including mango, orange, pomelo, longan and litchi, which significantly increased 5.7%, 9.1%, 12.2%, 8.4% and 60.6%, respectively. Export turnover of fruit and vegetable offered a new record of $US 3.126 billion and $US 0.588 billion, respectively.

Legume crops obtained 142,300 ha (7,100 ha decreased), and gained the production of 155,000 T (8,100 T decreased) with the productivity of 1.09 t/ha.

Soybean growing area is 53,100 ha (22.3% decreased).

Groundnut growing area covered 185,700 ha (5% decreased)

Sweet potato growing area is 117,800 ha (4% decreased)   

Coffee growing areas is 688,400 ha (same as 2018) with the average yield of 2.25 t/ha (0.08 t/ha increased) and the production of 1.62 million T (49,000 T increased). The export turnover of coffee offered $US 3.459 billion (1.18% decreased) with 1.87 million T (19.4% increased).

Rubber area is 695,000 ha (4,300 ha decreased). The average yield offered 1.64 t/ha (1.82% decreased) with total production of 1.14 million T (47,400 T increased). The export turnover of rubber obtained $US 2.187 billion (2.77% decreased) with 1.56 million T (13% increased).

Cashew nut cultivated area is 302,000 ha (4,500 ha increased) with the productivity of 0.86 t/ha (16.2% increased) and the production of 260,300 ton (44,500 T increased). The export turnover of cashew nut products offered a new record of over $US 3.429 billion (2.43% decreased) and a volume of 375,000 T (6.16% increased).

Black pepper growing areas are promoted over 149,000 ha. Pepper production obtained 255,400 T (2,800 T increased) and the average yield gained 1.71 t/ha (51.4% decreased). Domestic market price dramatically downed in 2018. The export turnover of black pepper offered $US 0.758 billion (32.1% decreased) with 233,000 t (8.28% increased).

Tea growing area is 123,700 ha with the production of 987,300 ton (15,300 T increased) and the average yield of 7.98 t/ha (12.9 t/ha decreased). The export turnover of tea gained $US 220 million (3.18% decreased) with the volume of 128,000 T (8.29% decreased).

In 2018, VietGAP certification was pinpointed in 1,845 farms with 80,284 ha, including coffee, tea, rice, fruit orchard and vegetable of 200, 3,924, 3,760, 67,8503 and 4,820 ha, respectively.

Thanks are due to significant changing of suitable cropping patterns and advanced agronomical practices; crop production value increased 2.52%.

In 2018, husbandry growth rate increased 3.98 % as compared to 2017. It is higher than the country planning of 2.1%. Total meat production obtained 5.31 million T (2.1% increased). Milk product obtained 960,700 (9% increased). Heads of pig increased 2.7% with 28.1 million units. Poultry obtained 409 million heads (6.1% increased). Cow and dairy cow increased 2.6% (5.8 million) and 14.4% (345,000), respectively. Buffalo continued decreasing with 2.42 million heads (2.7% decreased). The significant conversion of husbandry patterns focussed product quality as hybrid pig, hybrid bovin of 93.0% and 62.5%, respectively. Husbandry production has based on partnership models such as pork production’s value chain for both domestic and international markets in Hanoi, Bac Giang, Vinh Phuc, Dong Nai and Ho Chi Minh City. The export turnover of meat gained $US 546 million (11.56% increased).

Aqua-production obtained 7.75 million T (6.1% increased). Natural products gained 3.6 million T (5.3% increased). Culture production obtained 4.15 million T (6.7% increased) including brackish shrimp culture of 804,000 T (8.0% increased);  Pangasius fish (Pangasius hypoththamus) of 1.418 million T (10.3% increased). Total value of aqua-products increased 6.5% as compared to 2017; including culture production incresead 6.86%. It was higher than the planning of 5.29%. Aqua-product export turnover gained $US 9.013 billion (a new record with 8.47% increased as compared to 2017).

In 2018, forestry production value increased 6.09%; with 12.8 million m³ wood exploited (9.6% increased). Thanks are due to VPA/FLEGT signed between Vietnam and EU, the FSC forest areas, which were certified, have increased from 134,980 ha in 2015 to 245,061 ha in 2018. Wood production obtained 18.5 million m³ to meet 80% demand of furniture industry instead of 20% in 2010. The percentage of well-controlled and certified forests offered 85%. In 2018, there are 58,674 ha newly planted to replace the exploited forests including 17,735 Ha for business, 15,496 Ha for public construction. The newly planted forests obtained 225,000 ha to have the coverage percentage of 41.65% currently. Wood and processed wood export turnover gained $US 9.346 billion (15.7% increased).

Salt-marsh areas developed 13,417 ha (1.27% decreased). Salt production obtained one million T (64.2 % increased). Industrial salt product accounted for 34.5% (37% total salt-marsh areas) under new technologies applied.

In 2018, MARD has developed its important project namely “Promotion of agro-added value via processing and reduction of post-harvest”. Beside that, the output must be associated to available markets in 2020, adapted to 2030 vision. Especially, MARD will implement the project how “to develop sugar cane industry up to 2020, to set up the 2030 vision”, then to enhance the competitive potential of Vietnam sugar cane during 2018 – 2020. In 2018, there were 16 modern factories dealing with fruit, vegetable, pork and poultry meat processing under the input of $VND 8,700 billion ($US 378 million). Post-harvest loss in rice reduced less than 10%. Mechanization for land preparation accounted for 94% in case of rice, sugar cane, maize, vegetable.

Water irrigation potential meets the demand of 3.52 million ha of arable land, to assure 7.202 million ha of growing rice areas irrigated (93.3%). It increased its potential up to more 10,000 ha for irrigationa and drainage. There were 21,304 units, which were dealing with water management in the country (98% as due to cooperatives).

Based on the Cooperative Act in 2012; MARD established the project on “Developing 15,000 agri-cooperative farms up to 2020 fruitfully”. Today, there are 13,400 modern cooperatives; 39 Unions of agri-cooperative farms (14.6% increased). In the country, there are 35,500 farms suitable to new standards (1,500 farms increased). There are 3,787 communes, which were standardized as newly rural development title (42.4%). In 2018, there are 2,200 new agro-entreprises (12.3% increased as compared to 2017). The total agro-entreprises now comprised 9,235. People in rural life offering clean water supply accounted for 92%; it meant 2% increased as compared to 2017.

Big challenges could be considered as: (1) more abundant “small farms”; (2) risky markets for agro-products; (3) slowly developed industry for food preservation, processing; (4) big income gap between rural and urban (roughly $US 3,000 / ha).

To overcome our farmer low income, Vietnam would soon become a deep processing centre of world agriculture and a logistic hub of global agricultural trade. At present, it is necessary for the agricultural sector to continue to focus on implementing policies to support and encourage the development of deep-processing industry and the processing of instant food products. Otherwise, promoting mechanisation to reduce post-harvest losses and production costs, and creating high value added agricultural products. In agriculture, small value added (annual percentage growth) in Vietnam was reported at 18.14 % in 2016, according to the World Bank. Value added is the net output of a sector after adding up all outputs and subtracting intermediate inputs. The origin of value added is determined by the International Standard Industrial Classification (ISIC), revision 3. Attention would be paid more to food science with the emphasis on key technologies to process raw agro-products.

Vietnam is undertaking drastic solutions including promoting incentives to lure more investment in agriculture, and strengthening the value chain in production, processing and consumption of agricultural products to achieve set targets. The target MARD objectives in 2019 are set up as: (1) growth rate of 3.0%; (2) product value of 3.11%; (3) export turnover of $ 42-42 billion; (4) 48-50% communes and 70 districts standardized as newly rural development title; (5) forest coverage of 41.85%.

The IAS scientists will strengthen our cooperation to undertake responsibilities of one of the oldest institutions in Vietnam (1925-2019) in terms of Southern Vietnam to meet the demand by MARD and VAAS, which has pointed out the main targets to achieve in agriculture in 2019.

Prof. Dr. Bui Chi Buu

January 2019

(All statistical figures are highlighted from the MARD review in January 3 2019).