Vietnam commits to realising GMS high-tech agriculture priority

Prime Minister Nguyen Xuan Phuc addresses the plenary meeting of the GMS Business Summit in Hanoi (Photo: VNA)

Addressing the plenary meeting of the GMS Business Summit in Hanoi on March 30, Prime Minister Phuc also pledged to create a favourable environment and put in place preferential regulations for investment in advanced technology, supporting industries and hi-tech organic agriculture.

Taking advantage of Industry 4.0

Science-technology is a path to green and high-value agricultural development, Vietnamese Minister of Agriculture and Rural Development Nguyen Xuan Cuong said in his speech at an agricultural session in the framework of the GMS Business Summit.

The fourth industrial revolution (Industry 4.0) presents an opportunity for GMS nations to boost hi-tech agriculture, in terms of artificial intelligence to increase automatic production, thus reducing labour force and costs. It also allows biotechnology to create climate change-resilient crops and high-yield varieties, remote sensing technology to manage floods in river basins and Nano-material technology to create safer fertilisers and pesticides.

 The Government of Vietnam has issued several policies and incentives to facilitate the flow of investment in hi-tech agriculture, thus achieving food security and improving the quality of farm produce. In 2013, the Government approved a five-year restructuring plan for agriculture, with a vision to 2030, identifying science and technology as the foundation to create breakthroughs for the sector.

 In 2015, then Prime Minister Nguyen Tan Dung approved a master plan, under which the country expected to have 200 hi-tech agricultural businesses and build 10 hi-tech agricultural zones by 2020.

 Since then, groups like TH True Milk, Vingroup and Duc Long Gia Lai have invested in hi-tech agriculture. Foreign projects have also brought cutting-edge technologies from hi-tech agricultural nations, including Ireland, Japan, Israel and the Republic of Korea, to help produce products meeting VietGap, GlobalGap and international organic food standards.

 TH True Milk Group is one example of the new large-scale investment in agriculture, particularly in livestock breeding, with its farms totalling nearly 50,000 cows, producing about 500 tonnes of milk per day. The group was listed as Asia’s biggest concentrated and hi-tech dairy farm in the Asian Book of Records.

 Taking advantage of the Government’s new National Livestock Development Strategy and prioritising large-scale farming, the group scaled up its investment in hi-tech dairy farming from US$350 million in 2012 to more than US$1.5 billion in 2017.

 TH farms are supported by international technical consultants and high technology from New Zealand, Germany, Italy and the Netherlands, in the stages of herd management, financial management, water filtration, wastewater treatment, processing and packaging, according to Ngo Minh Hai, Chairman of the TH Group.

 The US’s agriculture producer Cargill Vietnam was established in Vietnam in 1995. Over the years, the company has built 11 animal food processing factories across the nation.

 Cargill Vietnam Managing Director Stoney Su, said his company has applied advanced technology to produce hi-quality products for livestock and aquaculture and to minimise volatility in farming.

 Cargill Vietnam set up satellites to monitor crops to help control impacts of climate change and extreme weather on farming and crop harvesting.  Advanced technology helps control crop diseases to ensure food safety and increase productivity.

 A data centre has been established to follow and predict animal growth and nutrition needs, and produce additives for animal food to enhance animal health.

 Yanmar Company, a leading group in farming machines, is a Japanese investor with hi-tech agricultural projects in Vietnam. 

 Takeo Matsubara, Senior Project Manager, Yanmar’s Corporate Planning Division, highlighted the changes technology has made in agriculture, saying that nowadays, 95% of Mekong Delta farmers harvest their rice using machines.

 He said agricultural technologies help reduce labour force and costs, post-harvest losses while improving the value of agricultural products. Japan uses robots to do farming, Takeo said, adding that his company wants to bring more agricultural machines and technology to Vietnam to help boost hi-tech agriculture.

 High technology fuels agricultural exports

 Vietnam’s agricultural sector has recorded remarkable achievements, making it among the world’s biggest farm producers and exporters.

 The country earned US$36.37 billion from exporting agro-forestry-aquatic products in 2017, a new record for total turnover in a year. Of which, the export value of key agricultural products is estimated to reach US$18.96 billion, up 15.7% from 2016.

 According to Dang Hoang Giang, President of the Vietnam Cashew Association (VINACASS), Vietnam’s cashew nuts are the biggest hard currency earner, raking in US$3.62 billion in 2017. Vietnam has become one of the world’s biggest producers and exporters of cashew nuts, with its market share accounting for 60% of the global cashew nut exports.

 Giang said technology plays an important role in increasing the value of agricultural products. Since 2008, technology has made a revolutionary change in cashew nut processing, resulting in robust cashew exports. Industry 4.0 ideas are crucial for cashew nut processing, in terms of establishing a processing chain and automation, to ensure quality and food safety standards. Technology has helped halve the time and labour force needed to process cashew nuts.

 Giang compared the sector’s growth rate to jet speed, adding that with the breakthrough of Industry 4.0, such as the Internet of Things (IoT) and Artificial Intelligence (AI), the sector can travel at missile speed.

 However, he also stressed the need for developing large-scale fields and specialised crops to ensure efficient application of technology in production and processing, saying: “We have to think about the mechanism to ensure production organisation, planning, large-scale fields, otherwise we cannot use airplanes for watering or pesticide spraying on small-scale fields.”

 Building on GMS agricultural value chains

 Agriculture is the backbone of the GMS economies, involving more than 60 percent of the subregion’s nearly 340 million people. The sector directly supports the livelihoods of nearly 200 million people engaged in small-scale farming.

 The Strategy for Promoting Safe and Environment-Friendly Agro-Based Value Chains in the GMS, endorsed in 2017 sets out goals to transform GMS agriculture systems into leading global suppliers of safe and environment-friendly agricultural products.

 The Core Agriculture Support Programmes, implemented from 2011-2015, helps guide regional cooperation in the agriculture sector. It addresses issues on expanding cross-border trade in agri-food products, climate change mitigation and adaptation and promotion of inclusive supply chain to enhance food security.

 It also helps increase producers’ access to international agricultural value chains and promote environmentally-friendly agricultural practices.

 In the joint statement adopted at the sixth GMS Summit held in Hanoi on March 31, GMS leaders agreed that the programme benefits farmers, rural women and small- and medium-sized enterprises, thereby addressing poverty, reaching marginalised groups and increasing the reach of inclusive development.

 Stoney Su, Managing Director of Cargill Vietnam, highlighted the subregion’s high-quality labour force, saying that the GMS can be successful with a community-based economy. Despite small-scale production, technology can help small players get involved in and win a big game by connecting them with resources.

 TH True Milk Chairman Ngo Minh Hai also highlighted the participation of household farmers in hi-tech agriculture, saying that the group’s high technology application requires heavy training for managerial staff, workers, small-scale farming and cooperatives outsourcers.

 TH True Milk has worked with households and cooperatives to ensure they grow grass and raise diary cows in line with the company’s requirements. Training courses and technical assistance are offered to farmers, introducing them to technologies in their farming process, while giving them sustainable incomes.

 The HCM City-based Marou Faiseurs de Chocolat has made waves worldwide with Vietnamese chocolate brand Marou, which was described on the New York Times as the world’s most exquisite chocolate bars and “the best chocolate you have never tasted.”

 Samuel Maruta, Co-founders of the Marou Faiseurs de Chocolat said his company uses Vietnamese cacao beans to make chocolate. Their single-origin dark chocolate bars are fully made in-house from cacao beans purchased from local farmers.

 “We support small scale farming by work directly with farmers. We go to their farms, see ourselves monthly, give them a long-term guarantee of prices and quantity, so they can be secure in the future farming. That way, we create a trustful relationship between firms and farmers,” said Vincent Mourou, Co-founders of the Marou Faiseurs de Chocolat.

 The company has helped put Vietnamese cacao on the international map, with numerous headlines on international mass media, including the New York Times, Bloomberg News, the Wall Street Journal, Monocle Magazine, Le Figaro Magazine, TF1 and France 2.

 Ousmane Dione, Country Director of the World Bank in Vietnam, affirmed that the agricultural sector continues to be the key factor for economic growth and sustainable development of the GMS nations. Regional nations need to ensure the sector will be competitive, adaptive to climate change and integrate into regional and global supply chains.

 Vietnam has integrated in several global value chains and can increase its added value by policy reforms and initiatives in the fields of transport, services, border procedures and regional integration, he affirmed.