The bilateral trade turnover in 2014 between Vietnam and New Zealand has expanded significantly by 23% compared to 2013 to NZD2 billion. Both nations have agreed to work cohesively to bring the figure to US$1 billion in 2015.
In turn, New Zealand’s key exports to Vietnam have historically been milk and wood products while Vietnam’s major exports to New Zealand have included beverages, coffee and food, says Mike Petersen, a New Zealand Special Agricultural Trade Envoy (SATE).
Both nations have been able to cooperate effectively as their trade needs are not competitive but rather are complimentary.
New Zealand has invested on average US$10 million each year supporting Vietnam’s agricultural sector with a focus on projects aiming to develop a value chain that benefits farmers and enhances capacity for small and medium-sized enterprises (SMEs).
A project on planting a new variety of dragon fruits in Tien Giang and a food safety and hygiene project in Binh Dinh province have been the most high profile New Zealand projects to date. However, these projects are incipient of New Zealand’s desire to become highly competitive through innovation.
New Zealand’s approach has been aimed at reforming agricultural production systems, improving the product quality and taking full advantage of limited agricultural land to make greater profits on a per ha basis.
The country wants to share these experiences with Vietnam to develop an agricultural chain with higher added value, which is mutually beneficial for both nations Petersen says underscoring that sharing experiences is highly beneficial to both sides.
For his part, Le Quoc Doanh, Deputy Minister of Agriculture and Rural Development, says Vietnam has taken the lead in the world in exporting differing types of farm produce than New Zealand such as pepper, coffee, cashew nuts, rice, tra fish, shrimp and rubber.
Vietnam’s farm produce has increased remarkably in quantity Doanh says but has remained unacceptably low in terms of quality, leading to low added value of products.
Opportunities to improve the quality of farm produce
Several nations with advanced agriculture have often supported Vietnam in poverty reduction projects over the year, which has contributed significantly to improving the quality of farm produce. However, obstacles still remain as the quality of farm produce and food safety has not been ensured.
Recently several batches of agricultural exports have been returned by foreign markets. Vietnam has hopes that through cooperation with New Zealand, both nations will share experiences to raise farmers’ awareness of agricultural production.
Dr. Tran Dinh Thien says Vietnam should turn to a hi-tech agriculture sector to process less exports with higher added value instead of aiming just to take the lead in the world by exporting huge quantity of farm produce with low added value.
In its future orientations, Vietnam’s agricultural sector need to concentrate its efforts to develop trade alliances with Japan, Israel and New Zealand. The move will offer the best opportunity to improve the quality of Vietnam’s farm produce in compliance with the international standards.
Although New Zealand has only 4 million people and is not a highly lucrative market for Vietnam’s farm exports, its technology can prove invaluable to Vietnam’s agricultural sector and both nations can join forces to support each other competing in the global marketplace.
New Zealand businesses can cooperate with Vietnamese counterparts to create modernized agricultural production zones, develop rice production in line with New Zealand’s production models and enhance quality, quantity and value of produce.
During the dialogue, the two sides have agreed to organise annually a trade policy dialogue forum while they are set to sign a food safety agreement next year.