Public-private farms draw foreign interest

Wednesday, Apr 08, 2015 17:15

Farmers are picking up tea leaves in Moc Chau province under a PPP project. PPP in agriculture has drawn foreign interest. — Photo

HA NOI (Biz Hub) — Even though millions of tonnes of farm produce has already been cultivated in Viet Nam under public-private partnerships (PPP), it is believed there is still much more in store for this farming sector.

Five years ago, Metro Cash & Carry Viet Nam and Cargill Corporation of the United States joined hands to carry out a PPP project in fisheries, in collaboration with the Ministry of Agriculture and Rural Development.

The model focuses on identifying potential fish breeds and directing farmers to the designated model serving the domestic market.

During the first period of the project, the three groups worked with authorities in the Mekong Delta provinces of Hau Giang, An Giang and Ca Mau to organise training programmes in aquaculture.

The programmes were attended by 300 farmers and 80 representatives of fish breeders and their associations.

Under the project, a centre for receiving, processing and packaging fishery products was set up in the Mekong Delta city of Can Tho in 2011. Within six months, the centre bought some 15 tonnes of fish products every day for consumption at the Metro supermarket network.

So far, the project has trained more than 2,000 farmers and 400 traders, and more than 4,000 tonnes of fish products have been produced and sold each year.

Similarly, after three years of implementation, a PPP project to grow high-quality tea by Unilever Viet Nam has attracted the participation of some 25,000 households in six localities. They include the four northern mountainous provinces, the central province of Nghe An, and the Central Highlands province of Lam Dong.

Last year, more than 12,000 tonnes of tea were produced and exported, in compliance with international standards certified by Rainforest Alliance (RA), the mandatory standard for exporting tea under the Unilever system. They brought in double the profits, as compared to that from traditional tea cultivation.

The project aims to raise the total amount of tea certified by the RA to 30,000 to 50,000 tonnes, and turning profits for some 40,000 farmers.

Moreover, global beverage giant PepsiCo and Switzerland-based Syngenta, the world's leading multinational producer of agricultural chemicals and biotechnology, joined forces to develop a project to improve the productivity and quality of vegetables and fruits.

PepsiCo and Syngenta invested in building an experimental farm in the Central Highlands province of Lam Dong, and provided farmers with financial aid and techniques to grow 12 types of high-quality and high-yielding potatoes, on a trial basis.

In addition, other products, such as coffee, sugarcane and rice, have also attracted multinational corporations.

Tran Van Thanh takes care of his coffee farm in Cu Mgar district, Dak Lak Province. — VNS Photo Nguyen Viet Thang

Numerous corporations, including Bayer, Nestlé Yara, EDE Consulting and Cisco, have invested in developing nearly 150 models of high-yield coffee in Lam Dong Province, with a total capital of US$350,000.

Last week, Nestlé began operations of a US$80 million facility in the southern province of Dong Nai's Amata Industrial Park, producing decaffeinated coffee beans for use in Nestlé factories across the world.

This facility is the second phase of the Nestlé Tri An factory. Having opened in 2013, the factory is a key part of the global Nescafé Plan that Nestlé has been implementing in Vietnam since 2011. Under this plan, the company is increasing their direct purchases of coffee from farmers and providing them with technical support. This not only helps the farmers, but also gives Nestlé a stable source of product that is of a consistent quality.

As part of the Nescafé Plan, Nestlé is cooperating with the Western Highlands Agriculture and Forestry Science Institute to replant old coffee trees. Nestlé also joined a PPP project with the Ministry of Agriculture and Rural Development (MARD) to raise the efficiency of coffee planting by applying best practices.

"It is not just about the quantity and quality; we want to increase the sustainability of coffee planting in Vietnam by using less water and fertilizers, thereby improving the whole value chain of the Vietnamese coffee sector," Executive Vice President in charge of Asia, Oceania and Africa of the Nestlé Group, Nandu Nandkishore, said.

In recent years, the number of coffee seedlings subsidised by the Nescafé Plan has increased dramatically. In 2011, the company had 300 recipient farmers who planted 76,000 seedlings. By 2014, the number of recipient farmers rose to nearly 20,000, with four million seedlings being planted.

Also, the Nescafé Plan announced that it would provide another four million seedlings to farmers in provinces in the Central Highlands in 2015, bringing the total count to 11 million, as Nestlé has subsidized 50 per cent of the cost.

Also, a project to grow high-quality rice by the Korea Rural Community and Agriculture Corporation was started on more than 20,000 hectares in the Mekong Delta province of Dong Thap.

Moreover, many local businesses have invested in agricultural development in other countries.

For instance, the Hoang Anh Gia Lai Group, Vinamilk and Nova Group are investing billions of dongs in growing sugarcane and rubber, breeding cattle, and milk processing in Laos, Cambodia, New Zealand and Poland.

Deputy Director of the Institute of Policy and Strategy for Agriculture and Rural Development, Nguyen Do Anh Tuan, said this was a new trend, but it was not irrational. A number of Vietnamese businesses invested abroad but targeted agricultural fields where Viet Nam had consumption advantages, not production advantages.

In addition, MARD has set up a task force to attract investment in agriculture and rural development. It will work to connect leading businesses with localities to attract private investment and to restructure agriculture towards developing the PPP model.

According to Tuan, many businesses operating in the fields of securities, real estate and mineral exploitation were beginning to invest in agriculture. Corporations such as Hoang Anh Gia Lai, Hoa Phat, Duc Long Gia Lai, Sai Gon Securities and FPT had very large demands for land to develop their farm products, he noted.

Tuan added that the time had come for localities to become more open in their policies to attract investment to push domestic businesses with strong financial capacities to invest in PPP projects. — VNS

Comments (0)