Vietnam Sector Development - Ended

Vietnam Sector Development

"Extensive stakeholder consultation to help design Vietnam's coffee sector development strategy"

Introduction

Since the early 90-ties, Vietnam has grown rapidly to become the world's second largest producer and exporter of coffee after Brazil. Nationally, coffee contributes about 3% to GDP, but its importance in specific rural areas is far greater because of the concentration of coffee production in these regions and the limited possibilities for producers of coffee to diversify their sources of income.

The rapid expansion of coffee led to serious problems such as deforestation, depletion of water resources due to over-irrigation and an increase of social tension between resident ethnic minorities and newly arrived coffee farmers as a result of landownership conflicts that have not yet abated. While the acreage under coffee expanded rapidly the development of training, financial and processing infrastructure could not keep up. Various problems ensued of which indebtedness of farmers and fluctuating coffee quality are a few prominent ones. Underlying causes can be attributed to weak sector organisation, limited access to knowledge, weak links between researchers and agricultural extension workers.

To alleviate sustainability issues in the Vietnamese coffee sector, three different pilot projects by the DE Foundation, Nestle, Kraft Foods and the German International Cooperation (GIZ) experimented with novel approaches to service delivery for coffee farmers. After a successful evaluation by Vietnam's Ministry of Agriculture and Rural Development (MARD), we partnered with what was then called the Dutch Ministry of Agriculture, Nature and Food Quality to help MARD design a coffee sector development strategy. To implement this project Vice-Minister of MARD, Dr. Diep Kinh Tan, formed a taskforce, chaired by MARD, with representatives from various ministries that have a say on coffee, industry experts, scientists, farmers and members of the Vietnam Coffee and Cocoa Association (VICOFA, an exporters' body).

Focus of the project

The specific goal is to enable the taskforce to design, in consultation with stakeholders, a development program for sustainable coffee based on results of studies and multi-stakeholder meetings on cost-benefit analysis of sustainable coffee production and sector organisation.

Activities

• Implementation of various studies on certification and sector organisation
• 2 stakeholder workshops resulting in a logical framework with key interventions
• Circulation of draft documents
• Finalisation of sector strategy

Results

• A common agreement was found on the major areas of improvement that are needed to enhance the sustainability of the coffee sector in Vietnam, such as the needs to:
  • Organise coffee producers to reap benefits of economies of scale
  • Improve consistency of coffee quality
  • Increase sectoral coordination
  • Enhance sectoral competitiveness
• A widely accepted coffee sector development strategy is available
• Increasingly, coffee sector stakeholders try to cooperate on common issues
• Coffee sector development strategy is used by MARD as a guideline for new coffee sector initiatives and allocation of funding

Partners

• Ministry of Agriculture and Rural Development - Vietnam
• Ministry of Economic Affairs, Agriculture and Innovation - The Netherlands

Contact

Dave D'haeze: dave.dhaeze@ede-consulting.com