Ranking first among ASEAN countries and fifth in the world in tea production and export volume, Vietnam is courting investors in the burgeoning industry.
A plan to attract domestic and foreign investment in the industry has been drafted, focusing on producing high-yield and high-quality tea products, identifying land area for concentrated tea growing, developing the processing and packaging industries, and promoting trade.
A conference on investment promotion in the industry was co-held by the Vietnam Tea Association and the Ministries of Agriculture and Rural Development, and Industry and Trade in Hanoi on Oct. 15-16, to collect suggestions to the draft, discuss measures to increase the industry’s competitiveness and to set up a trading floor for Vietnam ’s tea products.
At the conference, Deputy Minister of Agriculture and Rural Development Ho Xuan Hung said Vietnam has issued numerous incentives such as preferential taxes and land use in order to lure investment from non-State economic sectors to agriculture, including the tea industry.
According to Hung, tea is one of the strategic items in Vietnam ’s agricultural production plan and brings great social values in terms of environmental protection and poverty reduction.
However, he acknowledged that the investment flow in the industry, in common with the whole agriculture-forestry-fisheries and rural development sector, is still “limited”.
In addition to its advantages in terms of a long history of tea planting and experience in production, Vietnam also boasts favourable conditions in soil and climate, labour force, markets and potential to develop land area for tea planting, especially areas that are ideal for specialty tea products.
However, the tea industry has not caught the eye of investors as the acreage for high-quality and high-yield tea planting is still small, planters have not been able to create a stable supply for processors, and businesses lack experience in building trademarks and promoting their products.
Vietnam now has about 130,000 ha of tea with the participation of 675 businesses and 400,000 households in tea production, but can produce only 160,000 tonnes of dried tea every year.
With 80 percent of tea output exported, tea is one of the major agricultural staples bringing hard currencies into the country. It is also one of a few exported items that has maintained its growth in the context of the global economic crisis.
In the first nine months this year, Vietnam exported 97,000 tonnes of tea, fetching up to 127 million USD, a year-on-year increase of 14 percent./.