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Vietnam’s
economy in 2001
The
economic growth rate of Vietnam reached 6.84% in 2000, which is
the highest it has been in the last four years. Up to and including the present, the economic structure
of the country has been experiencing positive changes. Industrial production has
rapidly developed and occupies an
increasing proportion of the national production level. The proportion of the agriculture, forestry, and
fishery
sectors continued in a downward trend. The service sector has maintained the same
level as in previous years.
Domestic
investment capital increased by 20.5% and accounted for 69% of the
investment capital nationwide, in which, investment capital from private sectors
increased by 26%. Foreign direct investment (FDI) capital was US$ 2.2
billion, (increased by 3.2%). Disbursed capital from official development
assistance (ODA) was at US$ 1.7 billion (up 4%).
Total export turnover of the country
reached US$ 15.02 billion, a 3.8% increase from 2000, comprising US$ 8.352
billion (up 9.3%) from the export of domestic economic sector and US$
6.748 billion, (down 0.9%) from the export of the FDI sector (including crude
oil). The export turnover growth
rate in 2001 was lower than that in 2000 (25.2%), mainly due to fallen
prices or low prices of numerous products.
Despite the increase in
export volume, the export turnover of certain products still fell down compared to that
of 2000, particularly with most of the agricultural products. Some other
products, however, kept a high export turnover compared to 2000, for example,
fishery products - US$ 1.8 billion, up 21.7%; textile products - US$ 2
billion, up 5.7%; footwear - US$ 1 5 billion, up 3.8%.
The total import value of the country
was US$ 16.1 billion
–
up 3.4% compared to 2000, in which import value
from domestic economic sector was US$ 11.24 billion – down 0.4%, while
that of FDI sector was US$ 4.76 billion
– up 9.3%.
A slow increase in import value was due to the decrease of import prices. The
import
value of some items decreased, while their volume increased, such as petroleum -
an increase of 3.7% in volume and a decrease of 9.1% in value.
Some imported products
reached
a high level in both volume and value compared to 2000, such as steel - 32.6% and 15% increase in volume and value, cotton - 7.3% and
59.6% increase, respectively.
 In
terms of growth and structure, 2001 saw the agricultural sector benefit from a
decrease in the proportion of production value in the cultivation sub-sector,
while that of the livestock and service sub-sector increased.
Agricultural
production has been changing in its structure, from unproductive and unstable
rice to industrial crops, fruits and aquaculture, which are more profitable.
The area
for industrial plants reached 2,266.4 thousand ha, a 1.7% increase
compared to that of 2000, including 789.6 thousand ha of annual
industrial crops (up 1.5%) and 1,476.8 thousand ha of perennial
industrial crops (up 1.8%). Thanks to the application of new
varieties and technologies in intensive farming, the gross output of many industrial
plants in 2001 were much higher than those of the previous year: Cotton - 27.3
thousand tonnes, up 18%; tobacco - 30.9 thousand tonnes, up 13.7%; tea
- 371.8 thousand tonnes (fresh bud), up 18.1%; pepper - 44.4 thousand tonnes,
up 13.3%; coconut - 977.5 thousand tonnes, up 10.4%; coffee - 844
thousand tonnes, up 5.2%; rubber - 300. 7 thousand tonnes, up 3.4%;
raw cashew nuts – 140 thousand tonnes, up 3.7%.
Despite these figures,
some annual industrial crops decreased in both area and output, such as
sugarcane - 3.7% and with a 4.8% decrease; ground nuts – 1.5% and
0.7% decrease.
Due
to sharply falling prices of almost all agricultural products in the world market,
the export of agricultural products has faced difficulties, thus this has strongly
affected the
domestic prices of many commodities (particularly a 10 to 59% price decrease of major export products), such as rice, coffee, cashew nuts
and pepper.
However, thanks to improvements in quality and markets, the export of some
agricultural commodities has seen an optimistic view (fruits and vegetable, silk
forest products, meat etc), nevertheless these commodities account for a small
proportion in export turnover of agricultural commodities. In spite of an
increase in export volume, export turnover of agro-forestry products reached
only
US$ 2.6 billion in 2001 - a 6% decrease compared to 2000.
In
2001, the total investment capital in the agricultural sector was
VND
20,000 billion
and
accounted for 12.2% of investment capital in the country, a 16% increase compared to
the previous year (2001 Statistical Year Book). Of this amount, MARD
was earmarked a sum of VND 2,926 billion for capital construction, including
domestic and ODA capital. Domestic investment capital was mainly for irrigation
systems (accounting for 62% of the total investment capital) and for
important programs such as the National Program for Improvement of Seeds and
Breeds and The Agro-forestry Product Processing Program. ODA capital was
mainly
for developing
agricultural infrastructure and rural areas (irrigation, electricity,
transportation), environment (fresh water) and the development of industrial crops
(rubber, tea, fruits) and livestock..
In
2001, there were 51 FDI projects with a registered capital of VND 1,618
billion, mainly in the fields of processing fruits and vegetables, forestry and
lacquer-ware products.
Fixed asset value in the agricultural sector increased from VND 20,934 billion in 2000 to
VND 24,110 billion in 2001. The irrigated area of annual crops reached 73%,
with the exception of rice, which was 84%.
 Vietnam
has 11 major production sub-sectors, dealing in rice, coffee, pepper, rubber,
tea, cashews, fruit & vegetables, sugarcane, livestock, forestry and salt.
The
cultivated
area for rice reached 7.484 million ha with an average yield of 42.7 quintal per ha. Paddy
output recorded nearly 32 million tonnes. Compared to 2000, rice
cultivated area decreased by 2.4%, a 0.3 quintal per ha increase in yield and
a 0.5 million tonnes decrease in output.
Rice
export volume reached 3.73 million tonnes with its turnover of about US$ 625
million. In comparison with 2000, due to a 12.8% decrease in
export price, which led to 6% decrease in export turnover, despite a 7% increase in export volume.
Asian
countries, the largest markets of Vietnamese rice export in 2001, accounted for
56% of the total export volume and 60% of the export turnover.
Main import countries comprised Indonesia, the Philippines, Malaysia, Iraq.
Moreover, European markets (Russia, Poland) accounted for 1.1%, African
markets (South Africa, Tanzania, Senegal): 11%.
In
2001, the area covered by planted coffee was 567 thousand ha including 17 thousand ha of
Arabica coffee. The provinces with large coffee-planted area were Dak Lak
– 257 thousand ha, Lam dong - 124 thousand ha, Gia Lai - 81 thousand ha, Dong
Nai - 34 thousand ha and Binh Phuoc - 20 thousand ha. Coffee output reached 844
thousand tonnes, a 5.2% increase compared to 2000.
The export
volume of coffee in 2001 was 931 thousand tonnes, with the turnover of US$ 391
million and at an average price of US$ 420 per tonne - 27% increase in
volume but 22% decrease in turnover due to 38% decrease in export
price compared to 2000. Main importers were Europe with 65.4% of market
(including Germany, Switzerland, UK, Belgium, Netherlands, Italy, Spain,
France), America (mainly the US): 17%, Asia (Japan, South Korea): 13%.
In
comparison with other perennial crops, in 2001 pepper cultivation area increased
the most - 25% increase (from 27.9 thousand ha to 35 thousand ha), with
the output of 44.4 thousand ha (13.3% increase compared to 2000).
The export
price of pepper was only equal to the 40% from the previous year. Despite a 54% increase in export volume, turnover reached only US$ 142 million, equal
to 91% of the year 2000.
Asia was the main importer and accounted for 54% of the total exported volume of
Vietnam (in which ASEAN countries accounted for 29%, particularly
Singapore - 23%), Europe: 25% (EU - 17.7%).
The area of planted rubber trees reached nearly 418 thousand ha (up 1.5%), the output of
dried latex reached 300.7 thousand tonnes (up 3.4% compared to 2000).
In the northern area of the
south-east, the largest rubber planted area, 40% of the
total rubber planted area was accounted for and 56% of the total latex output, with high average
yield (1.2 tonnes per ha).
In
2001, rubber export volume reached 308 thousand tonnes (up 13%), due to a
decrease of 11% in export price, the export turnover reached US$ 166
million, equal to that in 2000. Asia, the main importer, accounted for nearly 70% (in which, China accounted for over 30%, Singapore- 13.2%,
South Korea- over 6%) and European countries - 25.6%.
The area of planted tea
reached nearly 100 thousand ha nationwide, of which the Northern
midland and mountainous area accounted for over 50 thousand ha (including Thai
Nguyen: 12 thousand ha, Ha Giang: 9 thousand ha, Yen Bai: 8 thousand ha, Phu
Tho: 8 thousand ha), Central Highlands: 20 thousand ha, Central Coast: 8
thousand ha. Vietnam's tea yield was around 1 tonne in dry/ha (25% lower compared
to the world average yield).
Đồi chè Mộc
Châu
MocChau's tea hill
The
total tea export volume reached 68.2 thousand tonnes (up 25.5%) with
a turnover of US$ 78.4 million (up 19.3%). Asia accounted for 61% of the exported volume (mainly Iraq 33% and Taiwan: 20%),
whereas Russia accounted for 7% (European countries- 17.5%).
The area of planted cashew nuts reached 199 thousand ha with an output of 140
thousand tonnes of
raw cashew nuts. Export
of kernel cashew nuts reached 44 thousand tonnes (up 28%) with
a turnover of US$ 151 million (a decrease of 9%, due to a
sharp decrease in export price, equal to 71% compared to that of 2000). Main
importers: Asian countries accounted for 36% (mainly China and Hong Kong),
America: 33%, Europe: 18.3%.
 There
are more than 570 thousand ha of fruits with an output of around 4. 5 million
tonnes and nearly 500 thousand ha of vegetables with an output of over 6.6
million tonnes.
70
- 75% of total fruits and vegetables output were for domestic
consumption, the rest was exported to 50 countries and territories. Since 1998, total
revenue from fruit and vegetable export has constantly increased, from 53.4
million US$ in 1998 to US$ 213.5 million in 2000 and US$ 330 millions in 2001
(up 54% from the previous year).
Cây Thanh Long - Dragon Fruit tree
The
Asian markets accounted for 65% of Vietnam's exported fruits and
vegetables (mainly China, South Korea, Taiwan), and European markets accounted
for nearly 6% (mainly Germany, Netherlands).
Total
planted area of sugarcane in 2001 reached 291 thousand ha- a decrease of 11,400
ha or 3.7% compared to the previous year.
Average
yield reached 49.2 tonnes per ha, the total output of sugarcane reached 14.3
million tonnes (down 4.8%).
Over the last year, there were 40 sugar mills with
a total capacity of 68,050 tonnes
sugarcane per day. Total sugar output reached 1,057 thousand tonnes nationwide (both industrial sugar and manual one) – down 12.5% from 2000. Sugar production was mainly for domestic consumption.
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| Giống
mía mới - High productive pigs |
Cattle
and poultry herds increased fairly well. There were 7. 1 million cattle (up 63
thousand), 20.8 million pigs (up 626 thousand heads), 209.7 million heads of
poultry (up 13.6 million).
The
total output of meat was at two million tonnes - an increase of 160 thousand tonnes
compared to 2000, including 1.4 million tonnes of pork (up 100 thousand
tonnes) and fresh milk output reached 60 thousand tonnes (up 8 thousand tonnes).
Both of these
products were mainly for domestic consumption.
Export
revenue reached US$ 230 million including US$ 40 million from pork export.
Proportion of dairy products was of the highest level (76%) in total
animal husbandry products for export.
The
total concentrated area of planted forest was at 208 thousand ha (a decrease of
18,000 ha compared to the previous year). The total area of regenerated forests
for caring was 520 thousand ha, and cared forest was 412 thousand ha. 235
million of scattered trees were planted. The output of timber and raw material
for paper production reached 2,420 thousand cubic meters, equal to 94% of
that in the previous year.
Đồi thông
- Pine hill
Total
export revenue for forest products (including wood and wood made handicraft,
rattan and bamboo products) reached US$ 391.5 million in 2001, increased by 35.8% compared to the previous year. Market share was divided as follows: Asia
accounted for 61% (mainly Japan, Taiwan), Europe: 30% (EU: 26%).
 Total
production area of salt was 18,578 ha nationwide, the output of salt reached
568,000 tonnes, down 67,000 tonnes compared to 2000, of which the North: 193,000
tonnes, the Central part: 181,000 tons, the South: 194,000 tonnes.
In
2001, the imports of salt reached 563,000 tonnes - the highest ever volume due to
the decline of salt production in 2000 and 2001, the increasing demand of salt
for chemical production, aqua product processing and animal feed.
Since
2001, The Vietnamese Government has been actively implementing a program on
industrialization and modernization in Agriculture and Rural Development. This
program hopes to promote the agro-forestry products processing industry,
support developing trade villages and services and to raise the income and living standards
of farmers.
The policy of "urbanization at site" has contributed to the transformation
of the
labor structure in rural areas. In 2001, 27% of farmer
households were dealing with both agricultural production and other professions,
while 13% of households were specializing in professional production and trade. There
were 40,500 professional business and production entities in the rural area,
14.1% of
which were accounted by state enterprises. Of the rest, cooperatives made up 5.8%
and private enterprises totaled 80.1%. Small hand made units in particular,
could provide stable jobs for 27 labors. There were 1,450 professional villages,
including 300 traditional ones. Those villages have provided works for 5 to 6
million workers and facilitated greatly in the development of services in rural areas.
Many
investment programs have been implemented in the rural area, which generate
sound
results in terms of improving the living standards and knowledge for people, such
as the program on fresh water supply, road and job creation.
Vietnam
has been highly appreciated by the World Bank (WB) and many other international
organization for their efforts in fighting hunger and poverty. The poorer households have decreased
from 29% in 1990 to 10.64% in 2001 (based on the former (1)
criteria of the former Ministry of Labor, War Invalid and Social AFFAIR - no
13266/L§-TBXH dated 29, August 1995). The living standard of farmers has also
made obvious improvements. The number of farmers with access to fresh water has increased
from 28% in 1996 to 46% in 2001. The percentage of communes with
electricity were 86.2%, the communes with car road to center were 94.6%; and the communes with medical station were 99%.
 Farm
economy has been consistently developing in Vietnam since the implementation of the
multi-sector economic policy. Thanks to encouragement policies from the
Government, this economic model has been developing rapidly in a stable,
diversified manner. These farms have contributed to the conversion of uncultivated
land into plentiful agri-forestry zones, characterized by a high rate of commodities,
which helped create jobs and increase income for people in the rural area. By
October, 2001, there were 60,761 farms of different types nationwide, including
farms specializing in planting annual crops which accounted for 36%, farms
specializing in perennial industrial crops: 27.3%, farms specializing in
aqua-culture: 27.9%, and the rest specializing in livestock and
forestry.
In 2001, the total
labor force working on farms was around 374,704 people with the average of six
people per farm. The output value of the farm sector reached VND 5,361
billion, of which 93% from the value of commerce and services. The
average income per farm was VND 31.4 million (General survey on Agriculture,
Rural area and Fishery carried out in October 2001).
Along with implementing
a policy on promoting international economic integration of the Vietnamese
Government, the agricultural sector has been carrying out many activities and has
recorded some considerable achievements. For example,
ASEAN
(Association of Southeast Asian
Nations)
cooperation in the agricultural sector was comprehensively carried out while
focusing on trade liberalization.
By
December 2001, 79% of tariff lines on agricultural commodities (654 out
of 830 tariff lines) have been put in the Inclusion List (IL) under the CEPT
framework, equal to the progress of the whole nation. The agricultural
commodities with a high level of tariff cut were fish, fresh fruits and
vegetables, coffee, semi-processed tea, pepper and milled products (with the
reduction rate of more than 50% when compared to the MFN). It was also ensured
that
sanitary and phyto-sanitary measures
were harmonized, and that the maximum residue
levels of pesticides used on vegetable formulated (MRLS). ASEAN countries have harmonized
175 standards of MRLS for 37 kinds of various repellents with the aim of
protecting human's health and ecological environment. ASEAN's cooperation
also focuses on participating in formulating the standards and indicators for
sustainable forest management in all Southeast Asian countries.
And in addition to all this,
there have been
other activities like programs on protecting water resources in the Mekong Basin,
trade promotion scheme of agricultural and forestry products and "farmer's
week", which have been carried out and are showing some promising results.
 The
agricultural sector has also been using the resources of APEC and ASEM, which concentrate
on the activities of scientific and technological cooperation, especially in
applying bio-technology, technology within processing agro-products, and facilitating procedures on animal and plant quarantine. These activities have
helped increase the capacity of officials working in the agricultural sector.
Alongside this the US/Vietnam bilateral trade agreement entered into force on 10 December 2001. Vietnam is committed to reducing, or at
least not increasing tax on 195 tariff lines of agro-fishery products. In addition, Vietnam
is also committed to reducing non-tariff barriers, extending the right to do business
and the right to distribute to American businessmen within three to five years after
the BTA going into effect.
Vietnam
has completed Session 5 of the negotiations on joining the WTO and is now preparing
for the next rounds. The agricultural sector has been actively participating in
the preparation of the negotiation plans, in areas such as tariff, non-tariff measures and
policies on agriculture. By actively preparing and implementing international
commitments, the Vietnamese agricultural sector has steadily integrated itself into the
regional and global economy.
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