Vietnam’s Agriculture Sector in COVID-19
This special article is developed based on submissions selected from ODV’s data driven story contest 2021 — funded by SPIDER.
The high and less volatile agricultural growth rate has contributed substantially to Vietnam’s economic stability. The agriculture sector acted as a shock absorber for the economy in the dissolution of the Soviet Union in the early 1990s, the Asian financial crisis in 1997, and the global economic downturn in 2008. Again, in the Covid 19 Pandemic in 2020, only the agriculture sector kept growing at the rate of 2.92 % to help stabilize the economy.
In 2020, the agricultural export turnover reached its target of USD 41,2 billion (about 2.5% higher than 2019) with 9 commodities above USD 1 billion, of which 5 commodities above USD 3 billion (timber and timber products, shrimp, fruits and vegetables, cashew, and rice). The agricultural trade balance reached USD 10.4 billion, up by 6.5% against 2019.
Though agriculture works well under COVID-19, the rural population is still being affected by the pandemic. The rural households main income source from on-farm activities appeared to be less negatively affected by the Covid 19 pandemic than those earning from off-farm activities, and salaries and wages. About 52% of farm households experienced an income decrease by 29.4% on average. Meanwhile, the income of about 73% of non-farm households fell by 46.8% on average and that of 59% of waged households dropped by an average of 38.3%. Most of the rural households living on subsidies and remittances reported to have unchanged income.
In response to the Covid 19 pandemic, all rural households have relied mainly on self-help and help from friends or relatives. Nearly 100% of households cut down living expenditures, about half had to live on savings, and a third asked for help from friends and relatives. Application for government’s supports was the next important strategy selected by nearly 20% of the households. This trend was similar among the three household groups (pure farm, pure non-farm, and mixed) though there was a difference in the extent of each strategy. More pure farm households cut spending and fewer used savings than the other two groups, which reflected the reality that they had very low or even no savings.
The Government of Vietnam has supported the rural households in Covid 19 pandemic mainly by increasing existing supports. About 34.7% of the total rural households accessed supports through this channel. However, their access to new and urgent supports explicitly for Covid 19 pandemic was limited, of which support for loss of income was the most accessible (12.8% of total rural households), then came the support for free basic necessities (4.2%), support for business activities (1.6%) and preferential loans via interest rate reduction and loan repayment extension (around 1%). Among rural household groups, more non-farm households could access to supports for loss of income, basic necessities and business activities, which reflected the real situation that this group was more negatively affected by the Covid 19 pandemic.
Editorial team: Open Development Vietnam
