As observed by Minister of Agriculture and Rural Development Cao Duc Phat, in addition to the government’s stewardship and principal role of producers, the involvement of businesses is a decisive factor in agribusiness development. Businesses are the most proactive component of the value creation chain and only they muster sufficient strengths to tackle the three main bottlenecks of agribusiness in Vietnam. Businesses have substantial resources to invest in large scale in efficient projects, businesses can help connect local and international markets for agricultural products and businesses have the ability to apply high technologies to production and manufacturing to adding value and enhancing farmers’ competitiveness. Public Private Partnership (PPP) seems to be the only viable investment strategy.
To attract FDI in agribusiness, a variety of policies and macro level measures have recently been activated. Importantly, on April 17, 2015, Prime Minister Nguyen Tan Dung formed an interagency steering committee for agribusiness to support its restructuring and sustainable development for 2015-2020. These bold steps by the government indicate its strong commitment in taking the local agribusiness to new heights in the context of integration.
Minister Cao Duc Phat informed that the agribusiness is contributing to 20 percent of the Gross Domestic Product (GDP), more than US$31 billion in export sales per year and provides half of the employment in the country. This is truly a major sector for the economy, the society and the environment.
METRO taking the lead in investing in agribusiness in Vietnam
METRO is one of the six FDI partners of the Ministry of Agriculture and Rural Development (MARD) in the ministry’s PPP scheme to promote sustainable development in specific subsectors. METRO’s fish Platform in the Mekong Delta is a proven example of a successful model of Public-Private Partnership in sustainable fishery development, setting up a quality fresh fish supply chain for Vietnam and increasing the value of agricultural products. The model was given high credit at the World Economic Forum for Southeast Asia. For its work, METRO received Awards for Sustainable Supply Chain Implementation in 2011 and 2012.
Mr Philippe Bacac, CEO of METRO Cash & Carry Vietnam said: “To date, METRO has trained more than 20,000 farmers, fishermen, producers and local officials to obtain the global Good Agricultural Practice certificate. The certificate helps farmers to be more efficient and make more profit in both domestic and export markets. In addition, METRO also connects farmers, producers and suppliers with an advanced distribution system, ensuring reliable and sustainable consumption.”
As a leader in the creation and development of sustainable agriculture supply chain, METRO’s platform and cold storage facility in Lam Dong province is one of the best distribution centers in terms of food safety standards for fruits and vegetables in the country.
Over the years, as a fishery PPP partner of MARD, METRO has been very active in advertising Vietnamese agricultural products to demanding markets in Europe. METRO, in cooperation with the Ministry of Industry and Trade, launched the Vietnamese goods week event in Germany in 2012 and 2014, helping to link Vietnamese companies and products with European modern distribution channels.
In 2014, METRO exported 81 containers of frozen prawns, pangasius and so on to 19 other METRO countries with a total value over US$7 million.
To successfully restructure the agribusiness through increased added value and sustainable development it is crucial to attract more dedicated FDI from firms like METRO.