In recent talks with the US, the Ministry of Agriculture and Rural Development (MARD) underlined the need to boost exports of non-traditional products in the agriculture, forestry and fisheries industries as part of the diversification of the national economy.

The agriculture, forestry and fishing sector comprises establishments primarily engaged in growing crops, raising animals, harvesting timber as well as fish and other animals from a farm, ranch, or their natural habitats, said Minister Cao Duc Phat of MARD.  

The establishments in this sector in Vietnam are largely small family farms, ranches, dairies, greenhouses, nurseries, orchards, or hatcheries, said Minister Phat, with a spattering of larger businesses.

Last weekend, ahead of the upcoming visit of President Obama later this month, Mr Phat held talks with Thomas J Vilsack, secretary of the US Department of Agriculture (USDA), to discuss measures to bolster trade of traditional and non-traditional products in the sector.

“Last year the US worldwide imports for the sector registered US$33.47 billion, for which Vietnam accounted for a 17% market share at an estimated US$5.69 billion,” said Mr Phat at the meeting.

"There certainly is potential for selling more ag and food as well as other products said Mr Phat, as based on last year’s figures the US market represents a market opportunity of approximately US$27.78 billion annually.

“But we really don't have the trade relationships we'd like, especially direct banking relationships so we can offer letters of credit and other financial arrangements, in conformance with the way trade is normally done in the US."

Sector exports to the US have great potential for growth if financial restrictions and other barriers are eased, said Mr Phat, especially for fruit. For example, the inspection procedures to allow fruit to enter the US market remains overly complicated and excessively costly.

So far, only four kinds of fruit – dragon fruit, rambutan, longan and litchi – have been allowed to enter the US market. However, the costs, particularly those associated with irradiation, to meet the strict US requirements remain high, leading to low profitability.

In addition, Mr Phat pointed out that the US Environmental Protection Agency and the US Food and Drug Administration have been overly restrictive of imports from Vietnam relative to other countries for testing of such things as antibiotic and pesticide residues.

Tra catfish and shrimp exports to the US have also faced unfair treatment and experienced unnecessary anti-dumping and anti-subsidy lawsuits, negatively affecting the trade relations between the two countries. This is the main reason why seafood exports to the US dropped 23% in 2015.

Mr Vilsack in turn discussed collaborating with Vietnam on improving the sustainability and resilience of agriculture and food production systems to address global food security in the face of climate change.

He also talked about the details of the now side-lined Trans Pacific Partnership (TPP) agreement and how he believed it would impact overall trade between the two nations should the US congress approve it and other important agricultural trade matters.

VOV