Fruits and Vegetables in Vietnam - International Food Policy ...

Like other exports, fruit and vegetable exports were arranged through bilateral government-togovernment
contracts. Because of the lack of market-determined prices, trade among COMECON
members was organized as barter trade. All exporting units were state-owned enterprises, assigned by
the state to carry out the trade plans. Since much of the trade was in the form of government-togovernment
barter contracts, it is difficult to evaluate the monetary value of these exports. According
to estimates from the Food and Agriculture Organization, fruit and vegetable exports during the late
1970s was in the range of US$ 8-15 million per year. The unit value of these exports was just US$
200-300 per ton, indicating that exports were dominated by relatively bulky low-value commodities
(see Table 6-1).
An early step in reforming Vietnamese agriculture was undertaken in January 1981, when the
Central Committee of the Vietnamese Communist Party issued Instruction 100/CT. Under this
regulation, farmers were required to produce a certain quota of rice and other basic commodities for
the state, but any production beyond this amount could be sold elsewhere at market-determined
prices. This policy stimulated the production of fruits and vegetables for the local market. Fruit and
vegetable exports are estimated to have risen from US$ 8 million in 1980 to US$ 35 million in 1985
(see Table 6-1). In the latter year, Viet Nam exported almost 12 thousand tons of fresh bananas and
3.5 thousand tons of fresh pineapple to COMECON countries (GSO. 1996). Nonetheless, food
shortages in the 1980s kept the emphasis of agricultural policy and investment on food production,
with the goal of achieving self-sufficiency in rice and other staples.
In December 1986, the Sixth Congress of the Viet Nam Communist Party announced a new set
of policy goals under the name doi moi (renovation). The government affirmed its intention to
encourage the development of the private sector; to give greater priority to agriculture, exports, and
consumer goods; to reduce inflation by correcting the budget deficits; and to promote international
trade. Specific policy changes to achieve these goals in agriculture, however, were not enacted until
1988-1989.
On April 5, 1988, the Politburo issued Resolution 10 which accepted the farm household as the
basic unit of agricultural production. Farmers were allowed to buy, own, and sell agricultural inputs
such as machines, buffaloes, and tools. Cooperative land was assigned to farming households for 10-
15 years under different forms of contracts or bidding. Furthermore, farmers were allowed to market
40 percent of contracted output. Later, compulsory government purchase of farm products was
eliminated.
In the late 1980s, the government established the Vegetable and Fruit Export Corporation
(Vegetexco) to consolidate state-owned enterprises involved in fruit and vegetable production for
export. Vegetexco had 28 state farms with 30 thousand hectares of land. In addition, it had 15
processing plants, primarily involved in processing fruits and vegetables for export. In addition, it
was given responsibility for carrying out research on the production and processing of fruits and
Chapter 6. Fruit and vegetable exports Page 6-3