return icon Vietnamnet.vn

Trade deals trigger foreign investments in Vietnam’s food sector

According to forecasts of BMI Research, Vietnam’s food industry is expected to achieve annual growth of 10.9% in 2015-2020.

{keywords}

 Vietnam’s food industry is expected to achieve annual growth of 10.9% until 2020.

 

 

 

Numerous international players, especially those from countries that Vietnam signed free trade agreements with, have been seizing the opportunity to enter the Vietnamese food market to take advantage of the deals.

Keith Colwell, Canadian Nova Scotia’s Minister of Agriculture and Minister of Fisheries and Aquaculture, said that Canadian food businesses have shifted their focus to Vietnam after developments in the Chinese market and thanks to tariff reductions under the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).

These companies want to bring high-end Canadian products like seafood, agricultural products and beverages to new markets like Vietnam, Colwell said, explaining that tariff reductions under the CPTPP have helped Canadian products become more competitive in Vietnam.

Besides Canadian businesses, more Japanese enterprises also want to invest in Vietnam’s agriculture, including food, according to Japan External Trade Organization (JETRO).

Hironobu Kitagawa, chief representative of the JETRO office in Hanoi, said Vietnam has many advantages for agricultural development, but its potential has not been fully utilized. Japanese investors have a lot of experiences in high-tech agriculture development, and they want to invest in Vietnam and bring into play their strengths.

Meanwhile, foreign investment in the Vietnamese food industry is also being facilitated as food processing is one of the industries that the country gives priority to in its growth plans until 2025 with vision until 2035.

With the priority, the government is offering preferential tax policies to the industry, including an import tax exemption for technologies to upgrade the production chain in Vietnam.

According to Le Hong Minh, director of the Investment Promotion Centre for Industry and Trade under the Vietnam Trade Promotion Agency, total FDI poured into Vietnam’s food processing sector was estimated at US$11.2 billion with 717 projects, not to mention foreign investors buying shares or conducting mergers and acquisitions.

Most of the FDI projects in the food processing sector were concentrated in big cities and provinces like Hanoi, Ho Chi Minh City, Binh Duong, Dong Nai and Long An.

High growth outlook

Statistics from the Ministry of Industry and Trade show that Vietnam’s annual food consumption is estimated at 15% of GDP. Over the past five years, the average annual consumption of processed food and beverages has grown at 9.68% and 6.66% respectively.

According to forecasts of BMI Research, Vietnam’s food industry is expected to achieve annual growth of 10.9% in 2015-2020, which makes it a very attractive field for investors.
The potential of the food sector lies not only in domestic consumption but also in exports. A diverse range of Vietnamese agricultural products are exported to over 100 nations and territories.

Vu Ba Phu, head of the Trade Promotion Agency under the Ministry of Industry and Trade, said that Vietnam has signed 12 free trade agreements with other countries. This enables Vietnam-based food processing businesses to expand their market size, increase export output, and reduce the import expenses of raw materials, machinery, and equipment, which will be manifested in product prices and the sector’s improved competitiveness.

To boost the development of the food industry, Phu said that the Ministry of Industry and Trade will continue to work with the Ministry of Planning and Investment and the Ministry of Agriculture and Rural Development and other agencies to offer the most favorable conditions for investors in the food processing industry.

Besides, the Trade Promotion Agency will also focus on organizing more trade promotion activities for enterprises in the food industry, he said. Hanoitimes

Anh Hong

New FTAs put pressure on VN to reform business practices

New FTAs put pressure on VN to reform business practices

New-generation Free Trade Agreements (FTAs) are expected to help Viet Nam become more competitive if the country reduces trading costs and improves its business environment, experts said on Tuesday at a conference in HCM City.  

Joining so many FTAs makes no sense: expert

Joining so many FTAs makes no sense: expert

Vietnam has signed many free trade agreements (FTAs) since 2010 but its participation in so many FTAs makes no sense, noted Tran Toan Thang from the National Center for Socio-Economic Information and Forecast.  

MORE NEWS

VIETNAM BUSINESS NEWS MAY 26

Vietnamese economy to do well in 2022: experts

VIETNAM NEWS HEADLINES MAY 26

Two die in elevator accident at Hanoi building

Will Vietnamese "unicorn" Coin98 be listed on Coinbase?

If this turns out to be true, US investors will have easier access to Coin98. This would open a new development period for Vietnamese Blockchain startups.

VN jumps eight notches in WEF’s Travel & Tourism Development Index

Vietnam’s travel and tourism sector has jumped eight steps despite two years of slowdown caused by the pandemic, according to the World Economic Forum’s (WEF) latest study.

VN real estate bonds shackled by rules

Although experts believe that rating agencies are an indispensable element of a healthy and transparent market, and a significant fundraising channel, real estate developers may suffer hurdles due to stringent bond issuance rules.

Vietnam Int’l Fashion Tour helps promote national culture, tourism

The debut version of the Vietnam International Fashion Tour (VIFT) will get underway in 2022 and 2023 across five cities and provinces, with the aim of popularizing the country’s culture and tourism to the world, said organisers.

Foreigners’ joint ownership of seaports, airports in Khanh Hoa mustn’t be allowed

When discussing the draft resolution on special policies on a trial basis in Khanh Hoa province on May 24, many National Assembly deputies showed concern about the foreign ownership of seaports and airports.

Vietnam-Asia DX Summit 2022 opens in Hanoi

The Viet Nam-Asia Digital Transformation (DX) Summit 2022 opened in Ha Noi yesterday, where experts are examining ways to further utilise the...

Reaching growth target a challenge for this year: NA chair

National Assembly Chairman Vuong Dinh Hue yesterday day expressed his concern that this year’s growth target will be hard to reach.

Hai Phong tops Public Administration Reform Index for first time

Hai Phong and the Ministry of Justice topped the Public Administration Reform Index (PAR Index) of 2021, based on feedback collected from more than 79,000 people about administration reforms in 63 localities and 17 ministries in Vietnam.

Thai retail corporation to sell some 1,000 tonnes of lychees

Thailand's retail corporation Central Retail in Vietnam plans to put on shelves about 1,000 tonnes of lychee this year, with first batches of the fruit from Bac Giang province transported to its supermarkets after a ceremony on May 25.

Facebook ads in Vietnam to be charged 5 percent VAT from June 1

Facebook ads in Vietnam will be subject to a 5 percent value added tax (VAT) beginning from June 1.

Base.vn owner successfully calls for $3.5 million of capital

The investment in True Platform is one of the largest ever seed-round investment deals in a technology startup in Southeast Asia.

Hanoi to spend VND60 billion for civil servants to study for master’s, doctoral degrees

Under a project on improving the quality of its personnel, Hanoi plans to spend VND61 billion to send civil servants and public employees to training courses for master’s and doctoral degrees in Vietnam and overseas.

Japan helps Vietnam with earth observation satellite project

JICA has signed a loan agreement with the Vietnamese Government to provide a Japanese ODA loan worth over 18,870 million yen for the Disaster and Climate Change Countermeasure project using the earth observation satellite.
back_to_top