Trung t©m Nghiªn cøu & Ph¸t triÓn HÖ thèng N«ng nghiÖp Centre for Agrarian Systems Research & Development Development of New Agricultural Cooperative in Vietnam PhD. Dao The Anh (PHANO and VAAS) Bangkok, 11/9/2015
Trung t©m Nghiªn cøu & Ph¸t triÓn HÖ thèng N«ng nghiÖpCentre for Agrarian Systems Research & Development
Development of New Agricultural Cooperative
in Vietnam
PhD. Dao The Anh (PHANO and VAAS)
Bangkok, 11/9/2015
Family farming in Viet nam
Equitable access to land for all household since 1988 Family farms with 10.3 millions unit Succesful Green Revolution
Irrigation High yield varieties, high land rotation High chemical input use
Food security: 70% rice Agricultural Exportations: rice, coffee, pepper, rubber, tea, cashew, fish, shrimp, fruit and vegetables …
Small Farm agri-land dominant in Vietnam, 2011 (%)
< 0.5ha, 50.7%
0.5 to 2ha, 30.4 %
2 to 5ha, 9.6%
Facing challenges of family farming: market access and competitiveness
Intensification
Exportation
High chemical input and resource cost
High emission
Low quality and farmer’s income
Lack of Value chain institutions and farmer’s organization
Agriculture growth and high value: competitiveness and contract farming in Value chain
Diversification for poverty Reduction and farmer income driven
GHG Emission reduction and adaptation
New Vision for Agricultural Restructuring Policy
Necessary for MARD to develop Agricultural Cooperatives
Agricultural restructuring
New business cooperatives
models
Policies
Agricultural cooperatives improve Farmer’s Competitiveness
Real demands
Contract farming
Cooperative legal environment changing fast
Building legal frameworks Cooperative law in 1996 Cooperative law in 2003 Cooperative law in 2012 : new cooperative type Decree 151/2007/NĐ-CP about Collaborative groups Decree 193/2013/NĐ-CP: guidance of Coop Law 2012
Cooperative policies Cooperative law in 2003 (Article 3; Decree 88/2005/) Cooperative law in 2012 (Article 6; Decree 193/2013/,
Decision 2261/ Decision Prime-minister on 15/12/2014)
Slow change of cooperative situation
Source: Department of cooperatives and rural development – MARD, 2014
Increasing number of cooperatives, from 9.628 (2012) to 10.500 (2014)
144 000 collaborative groups raising 6,7 million of cooperatives members,
in average 660 members/cooperative 92% of agricultural service
cooperatives 10% of Agricultural cooperatives
operated effectively under new Law Low profit and revenue
Agriculture co-operatives 92%
Forestry coopera-
tives1%
Fishery coopera-tives6% Salty coopera-
tives1%
Name of services provided by AC % of AC providing the serviceIrrigation 80Plant protection 55Veterinary 23Seed 53Materials 30Extension 87Land preparation 20Marketing and processing 8.6Electricity 5.8Internal credit 8.2
Services provided by Agri-Coop(5552 cooperatives are surveyed in
2012) % of AC providing the listed services
Services used by farmers from agri-cooperative and farmer groups
Unit: %
Source: OXFAM, 2014Surveys from 60 households in Ninh Binh, Lam Dong và Dong Thap, 2014
Education level of agricultural cooperative chairman (%)
14.05
28.43
2.68
14.72
40.12
Primary
Secondary
College
University
Untrained
Institutional challenges of Agri-Cooperatives
Inconsistent perceptions of Cooperatives: fast change of the law, lack of participatory consultation in law building
State management apparatus of cooperatives lack of capability Law guidance documents issued slowly Some localities managed cooperatives incorrectly Lack of consultancy service in cooperatives (establishment,
management) in local and business linkage Lack of training new type of cooperatives leadership and business
capabilities The mechanism of credit and land access for cooperatives is limited The tax regime is not reasonable for new coop Support policies measures have not enabling for favorable environment
for the starting of coop business, but mainly input supports by financial cover
What is Fao supports?
FAO project GCP/RAS/276/IFA and TCP/RAS/3405 “Pro Poor Policy Approaches to Address Risk and Vulnerability at the Country Level” will help:
initiate policy action to enable smallholder farmers to cooperate and organize along the value chain,
mitigating the new emerging market risks occurred in the rapid global economic integration.
MARKET and Value chain
COOPERATIVE Capital contribution
Support services to member
Input and output market
General demand in services and competitiveness
owner
Custom
er
Member
Member
Member
Member
Member
New Agri-cooperatives model: MARD drafting Agricultural Cooperative
Decree
01/05/2023 14
Fao Pro-poor policy support Mard for Agricultural Cooperative promotion
Training WS for AC Decree drafting Committee Consultation WS for AC Decree drafting Policy Brief: policy recommendation for AC Setting up the network of national and
international AC experts for Coop capacity building and advisory service
Joint effort with Farmer’s organization leader Forum in Viet nam (Mard, Phano, OXFAM)
Policy recommendation for New Agri-Coop in VietnamFor Cooperative Law and related legal docs:
1. Use internationally accepted typology in by service in value chain and give enterprise status
2. Keep cooperators flexible and autonomous3. Ease registration process: one stop shop service4. Simplify and unify legal documents5. Current practice of land policy and land-use
planning: facilitation of access for coop
Policy recommendation for New Agri-Coop in Vietnam (2)For Agricultural Cooperative Decree Draft:
Clear criteria and procedures for financial support for agricultural sector
Avoid crowding out private sector actors: in price and quality
Keep typical public or communal services separate from tasks of new cooperatives: by contract
The New versus The Old: equal support, based on business plan
The Large versus the Small: consider also Collaborative groups
Young farmers program
Cooperative leadership training: business and marketing
Win public support new type of cooperative model: media, education
Specify coordination of state management, advisory and training service and audit
Unitary taxing: exemption for starting The State encourages the establishment of a
Farmer’s Organization Forum
Policy recommendation for New Agri-Coop in Vietnam (3)
Thank for attention!