Farmers in Tam Da commune of Son Duong district, the northern province of Tuyen Quang, harvest sugarcane (P\hoto: VNA)Hanoi (VNA) – Development chances for the sugarindustry are still ahead if it can re-organise itself more effectively, PrimeMinister Nguyen Xuan Phuc said at a meeting seeking ways to tackle difficultiesfacing the sector on February 18.
At the meeting of the Government’s permanentmembers in Hanoi, the Ministry of Agriculture and Rural Development reportedthat the sugar and sugarcane industry are suffering numerous difficulties.
In the 2018-2019 crop, 17 of the 38 firms facedthe risk of losing equity. Prices of sugarcane material declined by 100,000 –200,000 VND per tonnes to 700,000 – 800,000 VND per tonne, equivalent toproduction costs. Meanwhile, seven sugar mills have suspended operations, andonly four or five factories are working effectively.
On January 1 this year, Vietnam removed thetariff-rate quota on sugar imports under the ASEAN Trade in Goods Agreement(ATIGA). Besides, many countries around the world have provided price subsidiesfor this commodity, so sugar import prices are very cheap. Meanwhile,Vietnamese businesses almost do not have any markets to export sugar to becauseof other countries’ protectionist policies, according to the ministry.
Addressing the event, PM Phuc said the sugarindustry has yet to be drastic enough in re-organising itself amid thecountry’s intensive integration into the world.
He noted Vietnam is currently a member of notonly ATIGA but also 12 other free trade agreements. Additionally, climatechange has resulted in drought in sugarcane farming areas, regulations on sugarimports remain unsuitable, the sector’s restructuring and sci-tech applicationhave yet to come to fruition, not to mention trade fraud.
The sector needs to be well aware of thesechallenges to align production with the market, he said, believing thatdevelopment chances for the sugar sector are still ahead if it can carry outeffective re-organisation.
Particularly, this year, the world’s sugarindustry may contract while sugar demand and prices may increase. This is anopportunities for the Vietnamese sector to restructure production, the PMnoted.
He suggested that domestic businesses can alsofind development chances in by-products to produce electricity, plywood,ethanol and fertiliser to create more added value.
The Government leader stressed the sugarindustry of Vietnam must hold the spirit of being ready to compete and competesuccessfully, asking businesses to restructure themselves and accept to beeliminated if they perform poorly.
The State will have support measures, but itdoesn’t subsidise the sugar industry. The sector must compete fairly in thecontext of international integration, PM Phuc said.
At the meeting, he agreed on the VietnamSugarcane and Sugar Association’s proposal on assigning authorised agencies tocarry out trade remedies that don’t run counter to international rules so as tofight the dumping of sugar products while enhancing the combat against sugarsmuggling and trade fraud./.
VNA
