VietNamNet Bridge – More and more foreign investors have poured their money into agriculture, the sector which was never before attractive to them.

Great potentials, great opportunity

Vietnam, with the favorable weather conditions, fertile land and industrial labor force, has great potentials for agriculture development.

Vietnam, for the last many years, has always been one of the biggest rice exporters in the world, thanks to which it is called the “Asian rice bowl”.

In 2012-2013, though facing big economic difficulties, Vietnam still could export 6-7 million tons of rice every year.

However, Vietnam’s agriculture had not attracted foreign investors until recently, when the investors can see the great opportunity for them to exploit the great potentials.

The great opportunity has come when Vietnam opens its doors widely by becoming the member of the regional and the world’s free trade agreements (FTA), including the Trans Pacific Partnership Agreement (TPP) and the Vietnam-EU which is still on the negotiation table.

Once Vietnam joins the FTA playing field, the tariff barriers will be removed, which would pave the way for Vietnam’s farm produce to penetrate the world’s markets.

Japan, which well understood Vietnam’s great potentials for agriculture development, began sending its specialists to Vietnam two or three years ago to learn about the feasibility of the outsourcing-based investment mode, which would help settle Japanese problems to be arisen once it joins TPP.

International observers said Japan may “make compromise” when negotiating about the tariffs on some farm produce when it joins TPP. If so, the country would have to cooperate with the countries with great potentials for agriculture development. Vietnam is one of them.

Observers have commented that Vietnam will get big benefits from the foreign investments in agriculture. Foreigners would bring huge capital and modern technologies to Vietnam, the things that Vietnam needs, to develop the agriculture production in the country.

Japanese, Israeli or Australian technologies are believed to help farmers have bountiful crops in the country where the soil is fertile and the weather is favorable.

Especially, the foreign investment is believed to help popularize Vietnamese farm produce brands in the world market. Stronger brands would surely bring more money to Vietnam, thus helping Vietnam clear the “low-price agriculture” image in the eyes of the world’s consumers.

Attractive preferences promised for agriculture investors

The Ministry of Industry and Trade has released the Circular No. 02 stipulating that from February 7, 2014, the import materials for domestic agriculture production (forestry, husbandry, aquaculture and salt production) would be listed would be exempted from the import tax – the incentives reserved for specially preferential investment projects.

Prior to that, the government issued the Decree No. 210, offering more incentives for the investment projects in the agriculture sector than the incentives stipulated in the Decree 61. The big incentives aim to help call more investment and strengthen the resources for the agriculture development.

Investors would be exempted from the land use fee if they develop the exceptionally preferential projects in agriculture. The 70 percent land use fee reduction would be offered to preferential investment projects.

Kim Chi