Workers care for cantaloupe at the Phu Yen hi-tech agriculture area. Investments in agriculture remain modest. — Photo phuyen.gov.vn

HA NOI (Biz Hub) — Viet Nam needs to create policies to promote investment in agriculture to build a farming sector to compete internationally, as the country integrates into the global economy.

Investments in agriculture remain modest, although the sector involved nearly 70 per cent of the country's population, while contributing some 18-22 per cent of gross domestic product and 23-35 per cent of the value of all exports.

Yet, investments in agriculture were estimated to account for only 6 per cent of the economy's total investments.

Experts at a meeting held by the Ministry of Agriculture and Rural Development on Friday pointed out that firms were hesitant to invest in the agricultural and rural sector due to bottlenecks in policies and mechanisms, including land-related issues and credit policies.

According to Nguyen Do Anh Tuan, deputy director of the Institute of Policy and Strategy for Agriculture and Rural Development, complicated administrative procedures controlling agro-fishery and forestry companies were discouraging investments.

A survey by the think tank in 2014 found that nearly 80 per cent of surveyed companies operating in the agricultural, fishery and forestry sectors wanted greater efforts in administrative reforms to create favourable conditions for businesses.

Tuan said that slow tax reforms must be hastened, together with incentives to be created to encourage firms to invest.

Tran Dinh Thien, director of the Viet Nam Economics Institute, stressed that it is time to change the view about the role of businesses in agriculture. Businesses should be viewed as the "leader" to drive the farming sector ahead, amid rapid international integration.

Nguyen Manh Hung, chairman of Nafood Group, said that open policies were important to encouraging firms to invest in agriculture to develop a modern sector with high quality output and greater productivity.

Further, the farming sector should raise planning and strategy in line with the development of firms, Hung said.

Additionally, Minister of Agriculture and Rural Development Cao Duc Phat, at the meeting, said the ministry would create measures to tackle problems faced by firms.

Phat noted that it was important for the agriculture sector to renew its production methods, in which firms played a role in the restructuring process. Supporting firms would mean supporting farmers, Phat said, adding that, without the participation of firms, it would be difficult for farmers.

"The ministry will create favourable conditions for businesses to invest and operate efficiently in the agriculture sector. This is a key in promoting the development of the farming sector," Phat said. — VNS