There is a widening gap between urban and rural areas in Vietnam in terms of infrastructure and social welfare. VOV has organized an on-air forum to discuss ways of helping farmers raise their incomes.

Dr. Le Duc Thinh from the Institute of Policy and Development Strategy under the Ministry of Agriculture and Rural Development said that farmers in the Mekong Delta produce 90 percent of the country’s total rice output and those in the Central Highlands most of the country’s coffee for export. However, they are still very poor, if not poorest, in the country.

Dr. Thinh emphasised the need to create a civil network that is strong enough to protect the rights of farmers. In a market economy, businesses sometimes have a lot more to lose than gain, and so do farmers. Nevertheless, in the long-term, farmers still fare worse than businesses, he noted.

He went on to say that most Vietnamese farmers are involved in small-scale agricultural production. Vietnam now grows four million hectares of rice. There are 10 million farming households and 200 rice exporters, but the profits they gain in agricultural production are very low. Many farmers cannot survive long with an average profit of 10 percent, while rice exporters can earn more than 10 percent. Since they often enjoy more incentive policies than farmers, especially when the global market is fluctuating.

It is a fact that when the rice price is high, the biggest share of profit does not go to farmers, but when it is low, only farmers suffer most. In a market economy, the relationship between buyers and sellers is based on negotiations and contracts. In most cases, businesses often take advantage of farmers as they operate in a larger scale and enjoy better conditions. To protect their rights, farmers should build up closer links and increase their competitiveness to gain the upper hand when negotiating contracts with businesses, Dr. Thinh said.

In recent years, the rice price on the local market has approached export prices on the world market. Therefore, proper mechanisms need being put in place to give farmers a bigger advantage when negotiating prices with businesses. The Government is considering measures to improve the price mechanisms by allowing overseas businesses to enter the market to ensure equality during negotiations.

Dr. Thinh suggested that the Government should adopt more incentive policies for farmers to help them develop technologies, buy different varieties and prevent pest diseases. It is also necessary to create a legal framework to ensure healthy competition and equality amongst businesses, and build up strong support networks for farmers so that businesses cannot put pressure on farmers by manipulating the prices, he added.

According to Professor Vo Tong Xuan, a leading agriculture expert, farmers in some developed countries enjoy many incentive policies. In the US, for example, the rice price is fixed and farmers are paid up front, not at the time they supply the rice to the businesses. When businesses have to pay higher than agreed at the time farmers supply their products, they often receive a subsidy from the Government to compensate for their losses. Moreover, those businesses that earn a good profit also give bonus payments to farmers who supply large volumes of rice.

Dr. Nguyen Ngoc De from the Mekong Delta Development Research Institute (MDI) proposed the establishment of joint ventures between farmers and businesses to share the responsibilities and benefits.

Accordingly, businesses will use farmers’ rice fields to develop their products and increase the quality of rice in line with the standard of Good Agriculture Practice (GAP). In this case, both businesses and farmers can share the net profits. The local authorities and relevant agencies will provide technical assistance and protect the legal rights of both parties, he said.

Dr. De stressed that businesses need a stable supply of good-quality rice for export, while farmers need capital and technology to raise rice output. If the relationship between businesses and farmers is harmonised, then modern models of agricultural production will take shape, thus bringing in more benefits for all parties concerned.