December 22, 2010

 

Mekong Delta's agriculture in decline, unsustainable

 

 

In just seven years, the once booming farm economy along Vietnam's Mekong Delta is on the verge of decline and proving unsustainable.

 

Barring a few farms that are still in business, most are struggling to meet costs. Many blame poor management, lack of investments and virtually no support from the State.

 

Tra Vinh province saw an increase in the number of farms from just 76 in 2001 to 3,200 within a year. Today, the numbers of farms in Tra Vinh have been reduced to just 1,820, most of which are facing losses and debts. In certain areas like Tieu Can district, 115 out of the 232 cow, pig and shrimp breeding farms have had to shut down.

 

In Chau Thanh District, three farm owners declared bankruptcy. Nguyen Quoc Huy, an officer in the district's Department of Agriculture and Rural Development claims that today only eight farms are in operation compared to 225 just a few years ago.

 

Tran Van Quan, the deputy head of the Tieu Can district's Department of Agriculture and Rural Development, claims the cause for farms to become bankrupt was mainly inefficient management, unstable market conditions and high revenue costs. Many farmers rushed to set up farms to avail of more benefits from the government. Such hurriedly established enterprises did not meet the required standards that the state required.

 

In the coastal district of Duyen Hai in Tra Vinh Province, more than 98% of the 204 black tiger shrimp farms have switched to crab farming, since shrimp pools are no longer lucrative.

 

Dong Thap, which once saw 4,600 farms has now about 100, out of which only a handful are fish farms. More than 50% of the farms have had to shut down and the remaining have turned to rearing other aquatic species.

 

In order to develop the farm economy, the State had promulgated many policies to give support to farm owners by way of tax cuts, credit loans, land purchases, trade promotion and marketing. However, most farm owners could not benefit from these policies and they had to create their own resources for loans, production and marketing.

 

Nguyen Van Mi, head of the district Department of Agriculture and Rural Development claims that even though they wish to help farmers to get loans the complicated lending procedures under the Decree only discourage farmers from applying for loans.

 

According to Ho Van Thiet, head of the provincial sub-department of Rural Development in Ben Tre Province, only 432 farms have been certified and 4,000 farms are still awaiting certification. Of the already certified farms only a handful have been cleared to receive incentives from the State.

 

Nguyen Minh Hien, deputy head of the Sub-department, blames poor coordination between concerned agencies and a sudden spurt of farms for the sole reason of benefiting from the states economic farm policy. He also believes that a number of farms do not want to apply for certification because they think they may have to pay corporate income tax besides also feeling uncertain about the state preferential treatment.