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Imports cripple nation’s husbandry industry
The domestic animal husbandry industry must lower production costs and increase competitiveness to survive, according to leading trade experts.
Experts said Viet Nam’s accession to the World Trade Organisation (WTO) had helped the agriculture sector, but the last two years had caused hardships for the industry.
In late 2007, in response to double-digit inflation, the Ministry of Finance proposed cutting import tariffs on animal products to ensure supply, as well as price stability on the domestic market.
Under the country’s trade commitments with the WTO, Viet Nam was scheduled to cut import duties on beef to 14 per cent by 2012, but the Government decided in late 2007to reduce tariffs to 12 per cent.
Although WTO trade commitments do not require a reduction of import tariffs on fowl, the Government has cut them from 40 per cent to 12 per cent.
Obstacles to growth
As a result of lower import tariffs, an abundance of cheap foreign food began to appear in the market.
The large volume of meat imports and hikes in animal feed prices have had a serious impact on domestic husbandry.
The Central Institute for Economic Research and Management said nearly 30 per cent of households involved in animal husbandry had to reduce their production activities.
According to Tran Ngoc Yen of the Institute of Strategy and Policy for Agriculture and Rural Development, about 20 animal feed producers were closed.
Most of the livestock establishments in the country are still small in size and do not use advanced technology.
Productivity is low, about 30 per cent lower than the world’s average, according to Pham Thiet Hoa, director of the HCM City Centre for Agricultural Consultancy and Support.
Hoa said that because Viet Nam’s economy had not yet been recognised as a market economy, it was not allowed to apply its own regulations to fight against sudden increases in imports, including the recent mass import of pork and chicken.
In addition, local breeders are not warned in advance about future meat imports and thus cannot make adjustments to their business.
Improving competitiveness
Tu Minh Thien, director of the HCM City Investment and Trade Promotion Centre, said the agricultural sector must develop a new strategy, focusing on the production of animal feed to ensure adequate local supplies at low cost.
Other experts said that developing large-scale industrial production models would help the industry improve its competitiveness in the global market.
In addition, experts suggested that the Government take advantage of WTO trade rules which allow the Government to offer support for agricultural development and livestock production, and protect domestic farm producers if necessary.
VietNamNet. vietnamnews
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