Vietnam - Farmers don’t want to be bosses, rather to be employees for foreigners

Not a few, but thousands of owners of farms and householders throughout the country have given up the dream of owning livestock farms. They tend to work as hired laborers for foreigners.

The wave of giving up self-employed business

On February 2, 2000, the government released the resolution on farm economy, the move which aimed to recognize and encourage farm economy.

If referring to the old definition about farm economy, by 2010, Vietnam had had 150,000 farms, including 20,000 livestock farms, which means that the country had had 150,000 farm owners.

However, analysts have pointed out that over the last five years, especially since 2008, they can see a new wave where the owners stop doing their own business to shift for doing the outsourcing for foreign enterprises.

No official statistics have been released about the number of farms’ owners and households who have been running breeding farms for foreigners.

However, the 100 percent foreign invested CP Vietnam, a subsidiary of the Thailand-based Charoen Pokphand Group, alone has had 3000 Vietnamese “satellite” farms to date. In a recent press conference, Sooksunt Jiumjaiswanglerg, General Director of the company, revealed that up to 20,000 Vietnamese farmers are working for CP Vietnam.

Many other foreign livestock groups have also set foot in Vietnam, and established their subsidiaries in the country. These include Malaysian Emivet and Indonesian Jappa which have signed the contracts with Vietnamese farmers, under which Vietnamese farmers breed fowl for the groups.

It is still unclear about the farming scale of the contracts, but analysts are sure that the value of the contracts is very big, because the two “big guys”, together with CP Vietnam, are now the three main chicken suppliers in Vietnam.

Preferring working as hired laborers than the bosses

Why don’t Vietnamese farmers want to run their farms as owners, but want to do the outsourcing for foreigners?

The answers given by the farmers are that they are too afraid of epidemics, they fear the market instability and they lack capital or have to bear overly high interest rates (the average lending interest rate is 20 percent per annum).

Nguyen Thanh Le, a farmer in Xeo Vong hamlet of Hiep Loi commune of Hau Giang province, who is breeding fowl for Emivet Vietnam, a subsidiary of Malaysian Emivet Group, said that his farm once had 15,000 fowl which had the investment capital of 1.5 billion dong. However, he has to run a fowl for the foreign invested enterprise because he did not have enough money to run the farm of his own.

“Only if the feed price stabilizes, the demand is good, and commercial banks agree to give support, will we be able to make investment in farming and run the farms independently,” he said.

The animal epidemics which broke out in recent years, such as the blue ear epidemic on pigs and bird flu epidemic on poultry, have frightened Vietnamese farmers. As incurring heavy debts, a lot of farmers and households have left farms idle or given up farming.

Nguyen Van Loc, the runner of the pig farm in Tan Linh Commune of Ba Vi district in Hanoi, who is working for CP Vietnam, said that Vietnam always remains passive in preventing epidemics. Vietnamese agencies only seek to buy vaccines and discuss treatment solutions when epidemics break out already. In many cases, agencies ask farmers to slaughter sick pigs, but this is the thing no one wants to do, because this also means that they will become penniless.

Meanwhile, foreign invested enterprises always follow a very strict procedure in farming. Only the best pigs can be used as breeders, while there is always an engineer in charge of technical issues at every farm who can discover problems soon and find out reasonable treatments immediately.

Therefore, Loc said farmers still prefer working as hired laborers to running their business themselves, even though they cannot get much money as hired laborers.

Dan Viet

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