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Country profile - Vietnam

Vietnam

Vietnam is testament to the power of agricultural reform. In the last two decades it has bounced back from the brink of famine to become the world's second-largest rice exporter. But, although it continues to industrialise and is one of the fastest growing economies in the world, new challenges are emerging that, if left unchecked, could plunge the country back into the dark and not-so-distant days of food scarcity. In short, Vietnam is not out of the woods just yet.

Overview

Although 70 per cent of Vietnamese earn a living from farming, the agriculture, fisheries and forestry sectors make up only one-fifth of GDP. Dry and glutinous rice are the dominant crops, accounting for nearly half of all agricultural production, with over 35 million tonnes produced annually, mainly in the Red and Mekong river deltas. Around four million tonnes is exported.

Vietnam is now the world's second-largest rice exporter (IFAD)
Vietnam is now the world's second-largest rice exporter
IFAD

Other important food crops are sugarcane, maize, cassava, potatoes and sweet potatoes while cash crops include coffee, cashews, soyabeans, pepper, tea, tobacco, rubber and coconut. Pigs, chicken and cattle are the primary livestock. The country also has four million buffalo, used mainly as draught animals.

Vietnam's long coastline and extensive river network mean that its fisheries industry provides a vital source of foreign exchange earnings. However, now with a 100,000-strong fishing fleet, there are growing concerns over depleting fish stocks, particularly in coastal waters. Despite this, foreign markets for shrimp, squid, crab and lobster remain lucrative. The number of shrimp farms is increasing, sometimes at the expense of mangrove swamps - important breeding grounds for fish and natural barriers to tidal surges.

Forestry is also a major industry, with exports of manufactured wood products tripling since the mid-90s. But deforestation rates are the second-highest in the world and illegal logging is rampant.

Rural reform

The 'Doi Moi' policies of the late 1980s and 90s were central to improving farmers' fortunes. Abandoning collectivisation, the government introduced liberal economic reforms, allocating plots of land to households on 50-year leases. Freer trade in agricultural commodities was also encouraged. Aided by fertile soils and abundant rainfall, agriculture boomed and the sector continues to grow by about four per cent per year: Robusta coffee exports now exceed those of Brazil, and the country exports more rice than India.

Reform of land tenure triggered a boom in agriculture (IFAD)
Reform of land tenure triggered a boom in agriculture
IFAD

While agriculture has been resurrected and rural poverty halved in the past decade, the latter remains stubbornly high at over 30 per cent. Many farm workers earn only US$25-30 per month, there is a growing wealth gap between rural and urban populations, and ethnic minorities in the countryside have been largely excluded from the benefits of economic growth. Rural areas also suffer from a lack of infrastructure, preventing many farmers accessing markets and resulting in large post-harvest losses. Over five million ha of productive land remain under state control.

Emerging threats

After Indonesia, Vietnam ranks second as the country worst-affected by the H5N1 strain of avian flu, having suffered 106 human cases and 52 deaths. Despite nationwide culls, fears of a resurgence of the virus are growing, with 5,000 chickens killed by an outbreak in May 2008. Porcine Reproductive and Respiratory Syndrome (PRRS), or 'blue ear' disease, continues to affect pig populations: in 2007 the Ministry of Agriculture reported over 20,000 pig deaths from PRRS in 19 provinces and hundreds of thousands have been culled.

Despite a flourishing agro-processing industry, food safety issues are on the rise in Vietnam, leading to fears of a looming "quality-control crunch". Scandals, including the use of formaldehyde to improve the shelf-life of rice noodles and concerns over "toxic" soya sauce, have done little to reassure buyers at home and abroad of food quality. Recent official studies also found high levels of lead, copper and E. coli in vegetables grown in "safe zones" in northern provinces, attributed to excessive use of fertiliser, pesticides and improperly composted manure. Also, there are ongoing concerns about increasing concentrations of carcinogenic dioxins in the food chain, related to Agent Orange herbicide spraying during the US-Vietnam war.

Sustainable success?

Rural development has largely excluded ethnic minorities (IFAD)
Rural development has largely excluded ethnic minorities
IFAD

Prone to natural hazards such as floods, droughts and typhoons, agriculture is also threatened by a host of manmade problems: deforestation has caused soil fertility in the highlands to plummet, resulting in a build-up of sediment in the country's rivers; soil salinity is affecting many rice-growing areas; scarcity of water and cultivable land is increasing as cities and industry compete for limited supplies. Dependence on one crop is risky yet the current high world price for rice is providing little incentive for farmers to diversify production leaving them vulnerable to poor harvests. Furthermore, the IPCC expects a sea level rise of some 60cm in the region by 2100, with the possibility of a 100cm rise - enough to submerge one-eighth of the country, including many of its rice-growing regions.

In light of its significant gains in productivity but the increasing threats on several fronts, Vietnam must now focus on making its short term successes sustainable. Until firm policies are in place, this emerging Asian tiger cannot afford to be complacent.

Statistical information
  • Country: Socialist Republic of Vietnam
  • Capital: Hanoi
  • Area: 329,560 sq km
  • Population: 86,116,559 (2008 est.)
  • Population growth rate: 0.99% (2008 est.)
  • Life expectancy: 71.33 years
  • Ethnic groups: Kinh (Viet) 86.2%, Tay 1.9%, Thai 1.7%, Muong 1.5%, Khome 1.4%, Hoa 1.1%, Nun 1.1%, Hmong 1%, others 4.1% (1999 census)
  • Languages: Vietnamese (official), English (increasingly favoured as a second language), some French, Chinese, and Khmer; mountain area languages (Mon-Khmer and Malayo-Polynesian)
  • Inflation: 8.3% (2007)
  • GDP purchasing power parity: US$222.5 billion (2007 est.)
  • GDP per capita: US$2,600 (2007 est.)
  • GDP composition by sector: agriculture: 19.4%; industry: 42.3%; services: 38.3% (2007 est.)
  • Land use: arable land: 20.14%; permanent crops: 6.93%; other: 72.93% (2005)
  • Major industries: food processing, garments, shoes, machine-building; mining, coal, steel; cement, chemical fertilizer, glass, tires, oil, paper
  • Agricultural products: paddy rice, coffee, rubber, cotton, tea, pepper, soyabean, cashew, sugar cane, peanut, banana; poultry; fish, seafood
  • Natural resources: phosphates, coal, manganese, bauxite, chromate, offshore oil and gas deposits, forests, hydropower
  • Export commodities: crude oil, marine products, rice, coffee, rubber, tea, garments, shoes
  • Export partners: US 21.2%, Japan 12.3%, Australia 9.4%, China 5.7%, Germany 4.5% (2006)

Date published: July 2008

 

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