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To collect information and data for the regional research in 2023: "Market access of agricultural commodity from Mekong sub-region countries to China" funded by International Fund for Agricultural Development, the research team of the Institute of Policy and Strategy for Agriculture and Rural Development organized the field trip to Vinh Phuc province in June, 2023. During this field trip, the research team organized surveys, investigations and worked with local authorities (Department of Agriculture and Rural Development, Department of Industry and Trade), organizations, exporters, traders, and farmers in Vinh Phuc province to understand the situation of production, trade, processing and potential for promoting agricultural trade with Chinese market.

Photo: Working with Vinh Phuc Department of Agriculture and Rural Development.

Potentials for exporting agricultural products to China

As the report of Vinh Phuc's Department of Agriculture and Rural Development, the total area of potential crops for export of the province in 2022 was approximately 21,404 hectares, including 1,911 hectares of banana (can produce around 52.3 thousand tons of banana fruit), 397 hectares of dragon fruit, 232 hectares of chili, 10,534 hectares of vegetables, and so on. These are high-quality agricultural products that satisfy the demands of the Chinese market.

From 2018 up to now, the province has built 16 production areas with 26 production unit codes with a total area of more than 171 hectares eligible for official export to diversified markets. Of which 15 dragon fruit unit codes with an area of 37.9 hectares that are eligible for export to Australia, New Zealand, the United States, and China; 02 banana unit codes with an area of 40 hectares and 06 chilli unit codes with an area of 73,416 hectares are eligible for export to the Chinese market; 01 Grapefruit unit code with an area of 5.92 hectares is eligible for export to the EU market. In addition, 01 chili packaging house has been granted qualified to export to the Chinese market...

Agricultural export to China facing remaining difficulties:

Implementing Commitments in the ASEAN-China Free Trade Agreement, China has so far reduced taxes on more than 8,000 items imported from Vietnam, including agricultural products and fresh fruits. However, Vinh Phuc province still faces many difficulties in exporting agricultural products to China. According to Mr. Le Van Minh - Head of the Management Board of Vinh Tuong market (Tho Tang market), Tho Tang market is the largest good transaction hub in the North of Vietnam, and is a trading focal point of many agricultural products, including agricultural products exported to China. However, since the Covid-19 pandemic, China has tightened plant quarantine measures and limited informal trade that lead to the reduction of goods amount exported to China. Most of the traders and enterprise buying bananas, dragon fruits and vegetables for export to Chinese market had to stopped their operation since Covid-19 up to now.

According to Mr. Giang Van Hung - Department of Crop Cultivation and Plant Protection of Vinh Phuc province: “Currently, the area planted with annual crops in the province tends to decrease. The scale of agricultural production is increasingly being reduced and narrowed due to industrial development. Although the province was given two production codes for banana areas in 2022, due to small area of production, none of the province's banana-growing farmer households meet the standards of Chinese market. It was particularly challenging to persuade local farmers to expand the banana area since China tightened border trade regulations, traders and enterprises in the province shifted to other business.

There are many reasons leading to difficulties in exporting agricultural products such as: i) The impact of the Covid-19 pandemic has disrupted international trade and transportation activities, making exporting agricultural products to China difficult; ii) China increased requirements on quality and food safety for imported agricultural products; iii) Production scale is small, fragmented. The area and productivity of some key crops such as bananas, soybeans, and vegetables tend to decrease sharply leading to low output and the shortage for export; iv) Enterprises have not built stable and sustainable raw material areas, has not focused on shifting to formal trade with Chinese market.

In the coming time, to overcome the above difficulties and continue to promote trade with China, Vinh Phuc province needs to synchronously implement measures from production, processing and trading.