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Developing agriculture, rural economy and new-type rural areas
23/1/2017 15:13' Send Print
An economic development model to build a new-type countryside in Cu Tri. Photo: VNA

Some achievements in agriculture, rural areas and building new-type rural areas

1. Vietnam’s agriculture has developed rapidly in scale, maintaining a relatively high growth rate for a long time, with gradually improved quality and efficiency.

From 2005 to 2015, the total output value of the sector increased 4.5 times, from VND 256,388,000 billion to VND 1,160,000,000 billion, accounting for an average growth rate of 4.5%/year, added value (GDP) increased by 3.3%/year; growth quality was improved, the proportion of added value in industry total production value was up from 57% in 2010 to 63.9% in 2012, 64.7% in 2013 and approximately 67.8% in 2014.

Commodity production in agriculture has strongly developed with increasingly high productivity and quality, meeting domestic and export demands. Agricultural sector’s production structure has shifted towards positive direction to raise the number of aspects and branches of advantage and highly added value such as fishery and animal husbandry.

- In the area of cultivation, rice acreage has gradually dropped, the areas under perennial industrial crops and fruit trees with high commodity value and market have been expanded. Intensive farming of most of the crops has been enhanced; technical advances, science and technology have been transferred and applied in plant and seed improvement and production process, hence productivity and outputs of various types of crops haved soared; farm product quality has improved. The average rice yield increased from 5.32 tons/hectare in 2010 to 5.77 tons/hectare in 2015; rice production rose from 40 million tonnes to 45.2 million tonnes. Corn yield increased from 4,09 tons/hectare in 2010 to 4.48 ton/hectare in 2015 and maize production was up from 4.61 million tonnes to 5.28 million tonnes respectively. Concentrated large-scale commodity production areas have supplied raw materials for the processing of rice, rubber, coffee, pepper, sugarcane, cassava and continued to be strengthened. Many vegetable and flower growing establishments which have applied high-tech have been set up and operated with high efficiency and high income.

Production value obtained per each hectare of cultivation has increased from VND 54.6 million/hectare in 2010 to VND 82 million/hectare in 2015, an increase of 1.5 times, export of farm products rose sharply from US$10.3 billion in 2010 to US$16.7 billion in 2015 and was estimated to reach US$17.5 billion in 2016.

- In the field of animal husbandry, animal husbandry farms, household farms and joint livestock breeding farms have gradually replaced small and dispersed household animal husbandy. Semi-industrial and industrial livestock breeding have developed. Breeds have been improved in both productivity and quality through increased imports of new varieties, new hybrid formula have been put into production. Total meat production went up from 4 million tons in 2010 to 4.7 million tonnes in 2015, meeting domestic consumption and partly for export.

High economic efficiency has been achieved with the model of industrial livestock breading chain from slaughter, concentrated processing to product distribution invested by domestic and foreign businesses and corporations. Production linkage models including animal husbandry contractors, close-knit meat and egg production cooperation and chain in Hanoi, Ha Nam, Bac Giang, Ho Chi Minh City, Dong Nai have been established.

The animal feed industry has grown in both quality and quantity. In 2015, it was estimated to approach 15.6 million tonnes; the average growth rate of the feed industry was equivalent to 7.96%/year; the proportion of manufactured feed over the total feed grew up from 54% in 2010 to around 61% in 2013 and was estimated at 65% in 2016.

- In the forestry sector, afforestation has been stepped up due to policies on allocation of land and forest and supporting policies through the 327 Program, and the Program of planting 5 million hectares of forest. Forestry production output and yield have increased rapidly, enhancing the supply of raw materials for the wood processing industry in the country from 30% in 2013 to 70% in 2015. Timber processing industry and export of forest products have been strongly developed in recent years. The policy on payment of forest environmental services has come into life, contributing to pooling resources for the protection and development of forests, and encouraged people to associate more with the forests. Forest coverage rose from 39.5% in 2010 to 40.7% in 2015 and was estimated to stand at 41.17% in late 2016. The export turnover of timber and non-timber products doubled from US$ 3.66 billion in 2010 to US$ 7.1 billion in 2015 and approximately UD$ 7.2 billion in 2016.

- In the field of fishery, fishery has continued to grow in the direction of promoting offshore fishing in association with protecting national sovereignty and marine resources. The fishing fleets were restructured with less small boats for inshore fishery, and more high-capacity offshore fishing verssels. The total number of fishing vessels of the whole country dropped from 129,000 in 2011 to 111,300 units in 2015, while the number of vessels with a capacity of more than 90 CV went up from 24,500 in 2011 to 30,700 in 2015, accounting for 27.6%. Fishing activities at sea have been organized in production teams. By the end of 2015, there are about 19,000 fishing vessels, 108,000 fishermen were grouped into 3,050 production teams, accounting for 17% of the total number of fishing vessels through out the country and 70% of the country's offshore fishing vessels.

Aquaculture has rapidly grown, focusing on key products with high competitiveness such as shrimp, cat fish, and mollusks. Along with expansion of areas, aquaculture has shifted to intensive production and disease prevention. Intensive aquaculture area has been expanded, especially for white-leg shrimp rearing. Proportion of intensive farming is estimated at 20% - 22%, which is 7% - 8% are white-leg shrimp and prawn. Efforts have been made to gradually modernize production system and commodity supply, build concentrated industrial breeding areas to supply disease-free (quarantined) breeds for aquaculture (prawn, white-leg shrimp, catfish, tilapia, molluscs). The Vietnamese Good Agricultural Practices (VietGAP) has been scaled up in aquaculture. 

Along with strengthening production, the Government has paid attention to boost marketing agricultural product. Policies have been made to assist and remove difficulties amid unfavourable changes in global and domestic markets, difficulties in marketing, and large inventories. Difficulties and obstacles have been removed in time and marketing of agricultural products for farmers has been ensured.

2. The rural economy developed rapidly, moving from structure based primarily on agriculture to industrial development and services.

Household economy has continued growing, transiting to family farm, farm or cooperative, joint teams, units, cooperatives or with enterprises for large-scale production. The structure of rural household income has also changed, the proportion of income from agriculture, forestry and fishery has declined from 39.4% in 2008 to 31.9% in 2012 and 28.8% in 2014 (1).

Many new-type cooperatives have been formed and developed, providing better support for economic development of member households. To date, the country boasts 6,302 cooperatives, 11% less than 2008, of which 74% have made profit. Currently, Vietnam has about 114,000 cooperative teams in agricultural sector, up by 8.7% compared to 2008, and 3,700 cooperative team in sea fishery. The cooperative teams have effective assisted farmers, and fishermen to provide mutual support to limit risks and do business more efficiently.

Agricultural and forestry farms have been rearranged and reorganized. Most of the state-owned enterprises in the fields of agriculture, forestry and fishery have been equitized, operating with increasing efficiency. More domestic and foreign private companies have explored and invested in agriculture and rural areas, many of which are now initiating high-tech agriculture, and ensuring food safety, creating jobs and increasing income for rural people and restructuring of agricultural labor and the rural economy.

So far, industry and services have accounted for 61% of the rural economy, the number of rural industrial establishments has increased by 8.64%/year on an average. Many industrial parks have become nucleus to form raw material production centres, and contribute to local socio-economic development.

In parallel with the development of industry and services, local authorities have also set store by developing craft villages, and crafts for economic development, while conserving and preserving local and national cultural identity and culture. By September 2016, there were 5,409 craft villages and villages having crafts, attracting about 12 million specialized labor, creating jobs and income for rural workers; exports bagged more than US$ 1 billion/year. Many items such as ceramics, furniture, handicrafts have achieved relatively high growth rate.

Many localities have instructed the completion of production, strengthened activities of agricultural cooperatives, the "big field" model have been replicated through out the country. Many joint production chain model in livestock breeding, aquaculture and forestry, and fishing teams have been set up and operated effectively. Many localities, such as Thai Binh, Ha Nam, Nam Dinh, Hanoi, Ninh Binh, Thanh Hoa have carried out "merging and exchanging fields," redesigned irrigation and internal transport system in anticipation of mechanization of production. Farmers in many provinces such as Thai Binh, Ha Tinh, An Giang, Hau Giang, Dong Thap are assisted to procure plough tractors, threshing machines and dryers and thus the rate of mechanization of these production stages increased from 40% - 50% to 80% - 90% respectively.

Vocational training for rural laborers have yielded effectiveness. As of June 2016, approximately 2.53 million people received vocational training of which about 1.13 million received training on agriculturel and 1.4 million received non-agricultural training.

Poverty rate in rural areas decreased from 17.4% in 2010 to about 8.2% (2) in 2015, an average drop of 1.84%/ year. Poverty rate in poor districts decreased from 50.07% at end of 2011 to 32.59% at end of 2014, an average decrease of 5%/year.

Agricultural and rural area infrastructure have been graded and gradual modernized; capacity to cope with climate change and prevention of natural disasters have been strengthened. Irrigation infrastructure has been insveted to raise capacity for irrigation, drainage, water supply and response to climate change. The Program to ensure the safety of reservoirs and the Program on strengthening river dikes and sea dikes have helped build and solidify major dikes through out the country, basically meeting the requirements for production, prevention of natural disasters. Investment has been made to modernize infrastructure in service of fishery, forest protection and development, forecast capacity, disease control for plants and animals, research and produce of new breeds and varieties.

3. Building new-type rural areas has become a nation-wide powerful and broad movement; after nearly six years of implementation it has contributed to changing the appearance, improve the living conditions of the population in many rural areas.

The National Target Program for Building New-typed rural areas has meet people’s aspirations and attracted enthusiastic participation of the whole society. After nearly six years of implementation, this program has changed the mindset of the majority of people from relying on the State's investment into proactive, confident, positive participation in building a new countryside. The Steering Committes were set up at the central, provincial, district, commune and village levels. The Prime Minister has launched the movement “The whole country join hands to build a new countryside.” The Vietnam Fatherland Front launched the movement “All people are united to build cultural life in residential areas” associated with building a new-type countryside.

New rural areas have become a reality: the system of rural infrastructure strongly has developed, changing the face of rural areas. Material and spirit life of a large number of rural population has improved markedly. Agricultural commodity production has been attached importance to, and has made changes thus actively contributing to improve the income of the rural population.

The role of party organizations, administration, and organizations in many places has been promoted, democracy in rural areas has been enhanced in quality. Where new-type rural area building gains success, people’s confidence in the lines, the policy, the leadership of the party committees and administration is high.

In 2015, the average income of rural residents reached 24.4 million (an increase of 1.9 times compared to 2010). Particularly in the rural communes which have reached new rural standards, the average income is VND 28.4 million /year, the poverty rate falls to 3.6% as compared with VND 16 million/year, the poverty rate of 11.6% respectively when the Program was started.

The rural areas have become more civilized and prosperous, contributing significantly to eliminating hunger, reducing poverty and ensuring security, and socio-political stability.

Regarding resource mobilization for the National Target Program on Building new-type Rural Areas in the period of 2011 - 2015, the total capital mobilized to implement the program reached VND 851,380 billion, of which VND 98, 664 came from the state budget, accounting for 11.6% (including VND 16.400 billion from the central budget, VND 82,264 billion from local budget) and 88.4% from various sources such as VND 434,950 billion from credit, VND 42,198 billion from businesses, VND 107,447 billion from communities and other sources, and VND 168,121 billion from other programs and projects implemented in rural areas. Particularly in 2016, the country mobilized VND 332,475 billion, of which VND 7,374 billion (2.2%) from central budget, 23,193 billion (7%) from local budget, 4.7% from other programs and projects, 78.3% from credit, 3.1% from enterprises, and 4.7% from people’s contribution.

Issues and the solutions

Despite great achievements, there remain objective and subjective limitations and weaknesses in agriculture and rural areas besides difficulties and challenges.

Agricultural production is slow in shifting toward a modern, large-scale production; added value, competitiveness of many agricultural products are low; household economy still accounts for a large proportion, fragmented production land makes it difficult to apply science-technology, mechanization level though increased is still low and not uniform; processing industry and supporting industry are also developing slowly; labor restructuring takes place slowly, the proportion of agricultural labor in the total labor force is still high (46%); labor productivity and competitiveness are low; agricultural markets are unstable; there is no significant improvement in the structure of export products (raw products and processing with low added value still account for high proportion), no national agricultural brands; food safety remains a pressing issue in society; social resources for investment in agriculture and rural areas remain limited; agricultural and rural area infrastructure do not meet demands; agricultural restructuring has not been given adequate attention in many localities, implementation has been slow, results are not obvious, and lack of sustainable growth.

The National Target Program on Building new-type rural areas is slower than set target, at the end of 2015 only 17.5% of communes reached standards, compared with the target of 20%; due to lack of resources many localities mobilized people’s contribution, resulting in debts; there remain difficulties in the lives of the rural population in many regions, especially in mountainous, islands, deep-lying and remote areas.

Cooperative economy sees a slow development, agricultural cooperatives have operated with inefficiently; agricultural businesses are too small in number (around 1% of the total number of enterprises in the country), weak competitiveness; organization of cooperative production and joint production chain is slow.

To effectively implement the Resolution 12th of the National Party Congress and the objectives of Resolution No. 26-NQ/TW on 5 August 2008 of the Central Committee, 10th Tenure “On agriculture, farmers and rural areas,” the agricultural sector should:

- Step up restructuring, shift from agricultural production inin large scale, and quantity to improvement of quality, added value and international competitiveness. Strengthen application of science-technology, give priority to high-tech applications and advanced production processes in order to create breakthroughs in productivity and quality of crops and livestock, and ensure food safety and friendly environment.

- Continue to innovate and develop forms of production, focusing on innovating and improving the efficiency of the operation of state-owned enterprises, agriculture, forestry cooperatives and companies; develop forms of close-knit cooperatives, joint production chain and marketing of agricultural connected to the global consumption system; encourage and create favorable conditions for enterprises to invest in agriculture and rural areas.

- Strongly develop in-depth processing of agricultural, forestry and fishery products in order to reduce losses and improve the added value; develop industry and services in rural areas to create jobs and transform agricultural labor.

- Make the most of opportunities offered by international integration to push up consumption markets, accelerate the implementation of the Program Branding of Vietnam’s agricultural products; adopt suitable policies for the development and consumption of each different group pf product: 1. Group of product with national advantage, 2. Group of product with local advantages, 3- Group of specialized product associated with regions, areas.

- Continue to invest in development and modernization of the agricultural infrastructure, rural areas; strengthen disaster risk reduction and effective response to climate change.

- Continue to focus on research, improve the mechanism, policies and create new momentum for the development of agriculture, farmers and rural areas, firstly and most importantly, land policies, facilitate the accumulation, concentration of land, remove obstacles on the management and use of paddy land.

- Promote and improve the quality of the movement to build new-type rural areas in the 2016 - 2020 period in implementation of Decision No. 1600/QD-TTg on 16 August 2016 of the Prime Minister, on “Approval the National Target Program on Building new-type Rural Areas in the 2016-2020 period”; implement synchronously socio-economically objectives, ensure security and order, protect the environment, build the Party and strengthen the political system; continue to improve quality and efficiency of new rural communes and districts which are recognized as obtaining new-type rural areas; attaches great importance to the organization of production, agricultural restructuring, craft, enhance production capacity, improve incomes, eradicate hunger and reduce poverty, build cultural life and green-clean-beautiful living environment, and ensure security and order for sustainable development of rural areas.

Export of agricultural, forestry and fishery products increased rapidly, from US$ 19.5 billion in 2010 to 30.45 billion US$ in 2015, estimated at US $ 31 billion-31.5 billion in 2016. Vietnam has 10 items reach export turnover of US$1 billion or more and achieve high rankings on the international market.They are cashew nuts, pepper, fish (first place); rice, coffee (second); shrimp (third, and prawn stands at first place), rubber (fourth), interior and exterior furniture, vegetables, and cassava. Vietnam has become the 15th largest exporter of agricultural products in the world.

As of 15 September 2016, 2,045 communes (equivalent to 23% of communes in the country) through out the country were recognized as new-type rural communes, an increase of 515 communes (5.9%) compared with the end of 2015. An average of 13.1 criteria were obtained by communes. Many criteria saw big rises. Approximately 90.9% of communes met the criterion of postal service; 85.48% of communes met the criterion of employment; 82.38% of communes met the criterion of rural electricy; 67.1% of communes met the criterion of public health; 61.37% of communes met the criteria for irrigation; 57.95% of communes met the criteria of rural markets; 56.48% of communes meeting income criterion; 53.36% of communes met the criterion of r poor households; 42.12% of communes met the criteria of schools; 34.56% of communes met the criterion of cultural facilities.

There are 24 district units obtained recognition as new-type rural areas by the Prime Minister, an increase of 9 units compared with the end of 2015. It is expected that by the end of 2016, the country would have about 30 units at district level recognized.


(1) Source: Statistical Yearbook 2015

(2) According to Decision No. 1294/QD-MOLISA on 10 September 2015 of the Ministry of Labour-Invalids and Social Affairs, "The Decision to approve the results of the survey of poor and near-poor households in 2014", the number of poor households in rural areas in 2014 was 1,312,656, accounting for 92.29% of the total poor households through out the country

This article was published on Communist Review No. 890 (12-2016)

* Dr. Nguyen Xuan Cuong, member of the Party Central Committee, Minister of Agriculture and Rural Development