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Household economic production needs to be reformed
How to overcome the contradiction between farming households and small-scale production in the current larger-scale commodity economy at higher production levels?
The findings of research conducted in the Mekong River delta show that households growing rice on more than 3ha obtained an output 5-6 times higher than those who grow rice on areas less than 1ha. Other research conducted by the World Bank show that the productivity of farming households who cultivated less than 1/4ha of land was 2.5 times lower than that of those who farmed more than 2ha. Meanwhile, most farming households in the Red River delta who had less than 0.3ha or less than 600 sq.m per person could only supply themselves. One third of farming households in the whole country are involved in small-scale production and are unable to produce on a larger scale.
The question here is not simply the production scale but the difference between the two technological systems, manual labour and the capacity to mechanise and apply new technologies and management methods at a higher level. Aqua-culturists have applied industrialised intensive cultivation or semi-intensive cultivation methods and obtained encouraging results. Meanwhile, quite a few rice farmers and salt workers still apply extensive cultivation methods in their small-scale production. Farmers in many locations grow new rice strains but still use manual labour and buffalos, hand-ploughs and hand tools. They still breed hybrid pigs with water hyacinths and banana trees as they did dozens of years ago.
According to an investigation made by the Institute of Policy and Strategy for Agriculture and Rural Development (IPSARD), since 2002 the average incomes of rural people has obviously increased. However, it is still less than VND800,000 a year, very low to make an effective investment. Only nearly 30 percent of farming households have breeding facilities. About 15 percent have other fixed assets such as gardens, cows, buffalo, pigs and pesticide sprayers. Those who have fixed assets of higher value such as workshops, cars and tractors make up a very small percentage. Due to low incomes and limited funding, only about 28 percent of farming households can expect to expand production with an investment of VND3 million a year. Moreover, they have less access to the market, science and technology. Consequently, over the last 10 years, agriculture has made up the largest proportion of Vietnam’s rural economy. Seventy-nine percent of agricultural production is on a household scale and cultivation made up 50 percent.
Statistics also show that over the last five years, rice productivity has stopped at 5.4 tonnes a hectare, while inputs prices and production costs have increased. Over the last 3 years, the production cost of rice has increased by 1.5 times. As a result, farmers are no longer attached to their rice fields.
Obviously, the current economic development and the capacity of rural production have exposed the limitations of the household economy which has become an obstacle to the development of the market economy in rural areas. According to Dr. Dang Kim Son, Director of IPSARD, income from farmland is minimal compared to labouring.
Meanwhile, Vietnam’s policy does not allow farmers to get more land so that those who have more funds and working capacity can use them more effectively. Mr. Son says, “If we continue to maintain the current household economy at such a low production scale and the people in the Red river delta do not want to sell their land at cheap prices but keep it as their own property, surely the agricultural advantages will be lost in the future.”
Prof. Dr. Vo Tong Xuan, former Rector of An Giang University also has the same view. He maintains that with their current private farming methods, most Vietnamese farmers could not cope with the fierce competition from outside. Mr. Xuan said frankly, “Japan, the Republic of Korea and Singapore are rich because they sell goods to rich people. Meanwhile, we remain poor because we target our goods at the poor. But if we want to make the rich our target, our goods must meet with their demand. So, if our farmers want to access the WTO steadily and successfully, they should not continue with their private production. Their current products are sold within their villages and so there is no way to access the richer markets”
VOV
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