Agricultural Policy Monitoring and Evaluation 2025

30. Viet Nam

Main findings

Support to agriculture

Viet Nam’s Producer Support Estimate (PSE) is negative and increasingly so since 2014, with an average of -11.9% in 2022-24. The PSE is largely driven by negative Market Price Support (MPS), most significantly for producers of rubber, tea and poultry meat, and to a lesser extent to producers of rice and cashew nuts. In contrast, producers of maize, sugarcane, peppers and beef benefit from higher prices. Overall, the positive MPS for these products is outweighed significantly by negative MPS, such that farmgate prices were on average more than 10% below border reference values.

Budgetary transfers to producers are relatively small and come entirely in the form of the most production and trade-distorting measures. These include payments based on variable input use, namely an exemption from the payment of irrigation service fees and subsidies for fertilisers, pesticides and machinery under the Sustainable Poverty Alleviation Programme, which targets producer support to communes in remote and mountainous areas. The government also supports the production of rice by guaranteeing an average profit margin of 30% for rice growers, which is maintained through rice purchases for the national strategic reserve and the use of minimum and maximum price brackets.

Support for general services for agriculture (General Services Support Estimate, GSSE) as a percentage of the value of production fell from 2.2% in 2000-02 to 1.5% in 2022-24. General service expenditures predominantly go to the development and maintenance of infrastructure, one-third of which goes to hydrological infrastructure for irrigation and the maintenance of 3.5 million ha of land in paddy. Expenditures under the Sustainable Poverty Alleviation Programme support the development of infrastructure, including roads and small irrigation schemes, as well as agricultural knowledge systems, via training targeted to ethnic minorities.

Total support accounted for -1.2% of Gross Domestic Product (GDP) in 2022-24, down from +2.4% in 2000-02.

Key recent policy changes

In early 2025, Viet Nam implemented a major government restructuring, merging the Ministry of Agriculture and Rural Development (MARD) with the Ministry of Natural Resources and Environment (MONRE) to form the Ministry of Agriculture and Environment (MAE). The consolidation aims to streamline operations and enhance the government’s capacity to manage agricultural and environmental policy.

The Digital Transformation Plan launched by MARD in March 2024 aims to modernise Viet Nam’s agricultural sector through expanded digital infrastructure, smart farming practices, e-commerce, and improved data management. The plan aims to build capacity and provide digital literacy training to farmers and agricultural enterprises.

Several initiatives aim to strengthen the sustainability and resilience of agriculture. New forms of financial assistance were introduced in early 2025 to help farmers recover from extreme weather events and disease outbreaks. The National Action Plan for Circular Economy was adopted in January 2025, including a strategic framework to enhance resource efficiency in agriculture. New financial incentives were also developed to promote sustainable, high-yield and high-quality rice production.

The Viet Nam-United Arab Emirates (UAE) Comprehensive Economic Partnership Agreement (CEPA), the first free trade agreement between Viet Nam and an Arab country, was signed in October 2024. The agreement will progressively remove tariffs on 99% of UAE exports and 98.5% of Vietnamese exports, with immediate tariff removals on key exported commodities including cashew nuts, pepper, and honey.

Assessment and recommendations

• Viet Nam has taken important steps to integrate sustainability considerations into its trade policy, and to mitigate GHG emissions from agriculture. However, the country faces significant agri-environmental pressures, including very high nitrogen and phosphorus surpluses, and several critical water management challenges. The government should promote integrated climate-smart agricultural practices that result in efficient water and nutrient management, reduced reliance on chemical inputs, and improvements to soil health.

• While important reforms to state-owned enterprises (SOEs) have been undertaken, SOEs continue to benefit from preferential access to credit and land, and play a dominant role in the production, wholesaling and international trade of export commodities. This, combined with structural inefficiencies along the domestic agricultural value chain, leads to the suppression of farmgate prices below international reference price levels. As a result, market price support is negative for several key commodities, including rice, rubber, cashew nuts, tea, and poultry meat. Efforts should be undertaken to encourage greater competition and phase out the preferential treatment of SOEs.

• Support to general services predominantly focuses on irrigation infrastructure for rice production, with relatively few resources allocated to agricultural knowledge generation and transfer. Shifting budgetary resources towards investments in innovation and agricultural R&D could help to boost the sector’s productivity and sustainability.

• New bilateral and regional trade agreements are enabling Viet Nam to diversify its export markets and deepen integration into the global economy. To fully capitalise on these opportunities, targeted investments are needed to strengthen the capacity of domestic producers and enterprises to meet international food safety, quality, and sustainability standards. These efforts can help to expand market access and enhance the competitiveness of Viet Nam’s agricultural exports.

Development of support to agriculture

Table 30.1. Viet Nam: Estimates of support to agriculture

Million USD

	2000-02	2022-24	2022	2023	2024p
Total value of production (at farm gate)	9 013	48 994	48 196	49 212	49 575
of which: share of MPS commodities (%)	77.05	85.90	78.92	80.25	98.52
Total value of consumption (at farm gate)	7 808	46 737	46 472	47 202	46 537
Producer Support Estimate (PSE)	593	-5 871	-5 294	-7 191	-5 127
Support based on commodity output	472	-6 070	-5 495	-7 394	-5 323
Market price support¹	472	-6 070	-5 495	-7 394	-5 323
Positive market price support	963	1 949	681	1 278	3 887
Negative market price support	-491	-8 019	-6 176	-8 672	-9 210
Payments based on output	0	0	0	0	0
Payments based on input use	101	197	198	200	194
Based on variable input use	101	197	198	200	194
with input constraints	0	0	0	0	0
Based on fixed capital formation	0	0	0	0	0
with input constraints	0	0	0	0	0
Based on on-farm services	0	0	0	0	0
with input constraints	0	0	0	0	0
Payments based on current A/An/R/I, production required	0	2	2	2	2
Based on Receipts / Income	0	2	2	2	2
Based on Area planted / Animal numbers	0	0	0	0	0
with input constraints	0	0	0	0	0
Payments based on non-current A/An/R/I, production required	0	0	0	0	0
Payments based on non-current A/An/R/I, production not required	0	0	0	0	0
With variable payment rates	0	0	0	0	0
with commodity exceptions	0	0	0	0	0
With fixed payment rates	0	0	0	0	0
with commodity exceptions	0	0	0	0	0
Payments based on non-commodity criteria	21	0	0	0	0
Based on long-term resource retirement	21	0	0	0	0
Based on a specific non-commodity output	0	0	0	0	0
Based on other non-commodity criteria	0	0	0	0	0
Miscellaneous payments	0	0	0	0	0
Percentage PSE (%)	6.38	-11.92	-10.94	-14.55	-10.30
Producer NPC (coeff.)	1.06	0.89	0.90	0.87	0.91
Producer NAC (coeff.)	1.07	0.89	0.90	0.87	0.91
General Services Support Estimate (GSSE)	201	718	728	730	695
Agricultural knowledge and innovation system	23	132	134	139	122
Inspection and control	0	0	0	0	0
Development and maintenance of infrastructure	173	570	578	575	557
Marketing and promotion	0	0	0	0	0
Cost of public stockholding	5	16	16	16	16
Miscellaneous	0	0	0	0	0
Percentage GSSE (% of TSE)	25.67	..	..	..	..
Consumer Support Estimate (CSE)	-697	3 486	3 741	4 434	2 283
Transfers to producers from consumers	-696	4 857	3 900	5 759	4 913
Other transfers from consumers	-22	-1 693	-147	-1 640	-3 291
Transfers to consumers from taxpayers	0	0	0	0	0
Excess feed cost	22	321	-11	315	661
Percentage CSE (%)	-8.79	7.43	8.05	9.39	4.91
Consumer NPC (coeff.)	1.10	0.94	0.93	0.92	0.97
Consumer NAC (coeff.)	1.10	0.93	0.93	0.91	0.95
Total Support Estimate (TSE)	794	-5 153	-4 566	-6 462	-4 432
Transfers from consumers	718	-3 165	-3 753	-4 119	-1 622
Transfers from taxpayers	98	-296	-667	-702	481
Budget revenues	-22	-1 693	-147	-1 640	-3 291
Percentage TSE (% of GDP)	2.42	-1.22	-1.11	-1.50	-1.06
Total Budgetary Support Estimate (TBSE)	323	917	928	932	891
Percentage TBSE (% of GDP)	1.00	0.22	0.23	0.22	0.21
GDP deflator (2000-02 = 100)	100	550	545	555	..
Exchange rate (national currency per USD)	15 000.33	23 777.97	23 252.29	23 655.98	24 425.64

.. Not available

Note: p: provisional. NPC: Nominal Protection Coefficient. NAC: Nominal Assistance Coefficient. A/An/R/I: Area planted/Animal numbers/Receipts/Income. 1. Market Price Support (MPS) is net of producer levies and excess feed cost. MPS commodities for Viet Nam are: rice, rubber, coffee, maize, cashew nuts, sugar, pepper, tea, beef and veal, pig meat, poultry and eggs.

Source: OECD (2025), “Producer and Consumer Support Estimates”, OECD Agricultural policy monitoring (database), https://data-explorer.oecd.org/.

Policy landscape

Main policy instruments

Domestic price support is the main form of support for Vietnamese producers, particularly in the form of border protection for import-competing commodities such as beef, veal and sugarcane. Following Viet Nam’s accession to the WTO in 2007, the simple average Most Favoured Nation (MFN)-applied tariff on agricultural imports decreased from around 25% in the mid-2000s to 17.1% in 2023. Despite the decline, this is more than double the MFN-applied tariff for non-agricultural goods of 8.1% (WTO, 2024[1]). Applied tariffs are much lower on imports originating from countries or regions with which Viet Nam has signed free trade agreements. For example, the simple average preferential tariff on agricultural imports is just 2.3% from ASEAN members and the People’s Republic of China (hereafter “China”), and 4.5% from Australia and New Zealand.

Viet Nam is a member of the WTO, the Association of Southeast Asian Nations (ASEAN), and the Asia-Pacific Economic Cooperation (APEC) and supports trade liberalisation between ASEAN members and their major trading partners. Outside of ASEAN, Viet Nam has negotiated bilateral free trade agreements with Chile, Cuba, the Eurasian Economic Union, Japan, and Korea. Agreements with the European Union and the United Kingdom came into effect in 2020. Viet Nam, along with ten other countries, signed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) on 8 March 2018 entering into force in January 2019. In 2022, the Regional Comprehensive Economic Partnership (RCEP) came into force for Viet Nam and 12 other countries, including ASEAN members and partner countries.1 Viet Nam signed the Viet Nam-Israel Free Trade Agreement (VIFTA) in July 2023, and the Comprehensive Economic Partnership Agreement (CEPA) with the United Arab Emirates (UAE) in October 2024.

State-owned enterprises (SOEs) play an important role in the production, wholesale, and international trade of export commodities such as rice, rubber, coffee and tea. They benefit from lower borrowing costs resulting from government guarantees extended by state‑owned banks, and have preferential access to natural resources, land and human resources (OECD, 2022[2]). This allows SOEs to exert market power, discouraging entry and reducing farmgate prices below international reference prices.2 Key SOEs operating in the agricultural sector include the Viet Nam Rubber Group (VRG), the Viet Nam Southern Food Corporation (Vinafood II), the Viet Nam National Coffee Corporation (Vinacafe) and the Viet Nam National Tea Corporation (Vinatea).3

The government targets maintaining 3.5 million ha of paddy land by providing funding for local rice growers through provincial support programmes. These programmes focus on the adoption of new rice varieties and investments in agricultural and rural infrastructure, among other measures. The State Bank of Viet Nam requires credit institutions to lend to rice producers with interest rates at least 1% below the existing market rates. This is to help meet the goal of cultivating 1 million ha of high-quality, low-carbon rice in the Mekong Delta by 2030. Financial support ranging from VND 750 000 (USD 31) to VND 1 500 000 (USD 61) per hectare per year is provided for paddy land, with an extra VND 1 500 000 (USD 61) per hectare per year for dedicated paddy rice in areas reserved for high productivity and high-quality rice cultivation.

Exporters of rice are regulated to promote stockholding to balance exports and domestic consumption, stabilise domestic rice prices, and fulfil international commitments in the event of natural disasters or crop failures. To obtain a certificate from the Ministry of Industry and Trade (MOIT) to export rice, exporters must have at least one storage and one milling facility (either owned or leased) that meet national standards and maintain rice reserves equivalent to 5% of the volume they shipped in the preceding six months.4 Exporters of organic rice are exempted from the need to obtain a certificate and from the storage and milling conditions.

An irrigation service fee (ISF) waiver exempts producers from payments to manage, maintain and protect irrigation works above the canal gate. The budget allocated to support this subsidy to irrigators has declined by 73% between 2020 and 2023.

Other support based on input use includes central and local government support to subsidise certain varieties of rice seeds and seedlings. Support for producers is also provided through the Sustainable Poverty Alleviation Programme (previously known as “Program 135”), which allocates support to communes in remote and mountainous areas. The programme includes subsidies for agricultural inputs and extension services.

Expenditures on irrigation systems dominate general services for the agricultural sector, a strategy that is manifest in the Hydraulic Work Strategy that sets objectives related to the supply of water for paddy fields and total land area in irrigation. Expenditures are allocated through investments by the central government in developing and maintaining irrigation infrastructure and through funding provided under the Sustainable Poverty Alleviation Programme to support the construction of small irrigation schemes.

In Viet Nam, all land is owned and administered by the state. The law allows ownership of a Land Use Right (LUR), under which title holders may conduct real estate transactions, including buying, selling, bequeathing, and leasing land, as well as using land as collateral for mortgages with financial institutions. There are different types of Land Use Rights with differing restrictions, limiting the duration of the right, the choice of crops, the process for converting paddy land from rice to another crop, and land transfers and exchanges.5 Agricultural land use plans and support policies tend to favour rice production.

Most farming households and organisations benefit from land-use tax reductions or exemptions. The agricultural land use tax exemption was valid until 31 December 2025, with a government proposal under consideration to extend them further until the end of 2030 or 2035.

Funding for extension activities is channelled through both national government agencies and provincial governments. The Science and Technology Department of the Ministry of Agriculture and Environment (MAE) administers an open bidding process to allocate central government funding for agricultural extension to both public and non-public providers. Provincial People’s Committees play the same role for local level projects. Funded projects follow a top-down model that emphasises the introduction of new crop varieties or technologies (Gray and Jones, 2022[3]).

Viet Nam signed and ratified the Paris Agreement on Climate Change in 2016. In its updated Nationally Determined Contribution (NDC), submitted in July 2020, the country committed to reducing, by 2030, Business as Usual (BAU) greenhouse gas (GHG) emissions of 927.9 MtCO₂eq by 9% using domestic resources and potentially up to 27% with international support. A reduction of 9% would represent an increase in total GHG emissions of 3.0 times the level of emissions in the historical base year of 2014 (284 MtCO₂eq); a reduction of 27% would represent an increase of 2.4 times relative to 2014 emissions. This goal represented a less stringent mitigation target than that set in the first NDC. However, in 2022, Viet Nam issued a decree on Mitigation of Greenhouse Gas Emissions and Protection of the Ozone Layer, under which the country strengthened its commitment to mitigation by pledging a 14% reduction from the 2030 BAU. Additionally, Viet Nam signed the Global Methane Pledge and committed to achieving net-zero carbon emissions by 2050 at COP26 in Glasgow in 2021.

The target for GHG emissions reductions from agriculture, which accounts for almost one-third of the country’s total emissions, is 43% relative to the 2030 BAU scenario, as set out in the Scheme on Tasks and Solutions to Implement the Results of COP26. Adaptation-related activities are defined in the National Adaptation Plan in Agriculture (NAP-Ag), under which MAE carries out vulnerability assessments, stocktakes of climate-smart agricultural practices, and pilot projects related to early warning systems, disaster response and training of government officials. In November 2024, Viet Nam issued the updated National Climate Change Adaptation Plan for 2021–2030, and in January 2025, approved a project to establish a national carbon market.

Policies for trade and sustainability in agro-food markets

Viet Nam has Free Trade Agreements with several countries including Australia, New Zealand, the United Kingdom, Chile and the European Union. Some of these agreements contain specific sections regarding environmental co-operation. For example, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which includes Viet Nam, Canada, Mexico, Peru, Chile, New Zealand, Australia, Japan, Singapore, Brunei, Malaysia, the United Kingdom (which came into effect in Viet Nam in 2019), has a section on “non-derogation” stating that countries must not weaken or reduce environmental protections to attract trade or investment. The Viet Nam-EU Free Trade Agreement (EVFTA), in effect since 2020, includes sustainable development measures such as collaborating on initiatives to reduce GHG emissions, as well as food safety measures including aligning sanitary and phytosanitary (SPS) measures to international standards. Meanwhile, stricter sustainability standards have required Vietnamese exporters to improve food safety measures, adopt sustainable farming practices, and comply with environmental and labour regulations. Rules of Origin and Sanitary and Phytosanitary requirements have driven investment in food processing, quality certification, and organic agriculture to maintain EU market access (Agroberichten Buitenland, 2021[4]).

Vietnamese agri-businesses are required to conduct GHG inventories, implement emission reduction plans, participate in the carbon market, and manage ozone-depleting substances. Entities with annual energy consumption exceeding 1 000 tonnes of oil equivalent (TOE) must submit operational data for GHG inventories by 31 March of the reporting year, covering the previous year’s data. Starting from 2024, these entities are required to conduct a GHG inventory every two years and prepare a report. Ensuring compliance with this decree is essential for Vietnamese agri-businesses seeking to export to markets that require certified emissions data, particularly as carbon footprint reporting becomes a standard component of trade agreements.

The 1 million hectares of high-quality, low-carbon rice project (2024-2030) aims to lower methane emissions from rice farming, which accounts for nearly half of the country’s agricultural emissions. The project promotes climate-smart farming practices, including alternate wetting and drying irrigation, mechanised direct seeding, and organic fertiliser use. To support adoption, green credit policies provide financial assistance to farmers, while sustainable certification schemes such as the Sustainable Rice Platform (SRP) enhance access to premium export markets. The project targets to have high-quality, low-emission rice accounting for over 20% of total rice exports from the specialised farming region by 2030.

The Action Plan on Methane Emissions Reduction (2024-2030) targets a 30% reduction in methane emissions from 2020 levels by 2030, with planned reductions of 42.8 MtCO₂eq in the agricultural sector. The government has prioritised methane reduction strategies such as optimising livestock feed, expanding biogas production from manure, and promoting low-methane rice farming techniques. Economic incentives, including methane-specific carbon credits and green finance, support mitigation in farming. Large agricultural enterprises are now required to report emissions annually to the MAE, following IPCC Tier 2 standards. The policy also introduces a Monitoring, Reporting, and Verification (MRV) system to specifically track methane emissions at the farm level, using digital reporting and remote sensing. Refined emission coefficients from 36 field sites and 73 cropping seasons ensure accurate regional data for policy planning (Vo et al., 2020[5]). These measures also help Viet Nam comply with emerging trade-related emissions regulations, such as the EUDR and carbon footprint standards in high-value markets.

Viet Nam has introduced several new policies to enhance GHG emissions measurement and mitigation in agriculture. These concern carbon credit certification, emissions trading, and compliance mechanisms. The government has also expanded the MRV system, requiring major agricultural emitters to track and report emissions data. To improve farm-level measurement, Life Cycle Assessment (LCA) is being implemented to quantify methane and nitrous oxide emissions, while digital monitoring tools and remote sensing technologies are being integrated into emissions tracking. Meanwhile, Viet Nam has taken steps to improve verification and compliance within carbon pricing frameworks. All emission reductions must undergo third-party verification by accredited auditors who assess data accuracy and project eligibility, as well as compliance checks to regulate carbon credit certification and GHG trading. The ISO 14064 standard, widely used in international carbon accounting, is being adopted in Viet Nam’s agricultural sector to ensure transparent emissions reporting.

In January 2025, the government approved a project to establish and develop the country’s carbon market, with legal frameworks to be finalised by mid-2025, pilot operations from 2025-28, and full implementation by 2029. The carbon pricing framework is supported by a MRV system which requires major agricultural emitters to track and report emissions data. The government has also promoted LCA to be used for farm-level emissions tracking. These assessments quantify methane and nitrous oxide emissions from livestock, rice paddies, fertiliser use, and transportation, helping farmers to adopt lower-emission practices.

To support emissions measurement in rice cultivation, the Ministry of Natural Resources and Environment (MONRE) developed the “Handbook for Measuring Greenhouse Gas Emissions in Rice Cultivation” (2016) in collaboration with international partners. This document provides standardised methodologies for farmers and enterprises to assess and report emissions, ensuring consistency across the sector.

Recent policy developments

Domestic policy developments in 2024-25

In early 2025, the government restructured its ministries, merging the Ministry of Agriculture and Rural Development (MARD) with the Ministry of Natural Resources and Environment (MONRE) to establish a new Ministry of Agriculture and Environment (MAE), which officially came into operation from 1 March 2025.

In February 2024, the Prime Minister signed a decree requiring ministries, agencies and localities to enhance logistics connections for agricultural, forestry and fisheries products. This falls under the “Project on Developing Logistics Services to Enhance the Quality and Competitiveness of Vietnamese Agricultural Products by 2030, with a Vision to 2050”, which aims to establish an efficient logistics system to reduce post-harvest losses, lower distribution costs, and improve the overall competitiveness of Viet Nam’s agricultural sector in domestic and international markets. As part of this effort, a proposal was submitted to enhance agricultural logistics, and initiatives have been launched to strengthen logistics connectivity for NLTS exports.

In March 2024, MARD outlined the Digital Transformation Plan for 2024, which aims to modernise Viet Nam’s agricultural sector by expanding digital infrastructure, including e-commerce platforms and digital supply chain solutions, integrating smart and precision farming, developing a national agricultural database, and improving data management and monitoring of soil conditions, pest management and weather forecasting. The initiative also prioritises capacity building and digital literacy training for farmers and agricultural enterprises, enabling broader adoption of smart agriculture solutions.

New forms of financial assistance, input subsidies, and technical support to farmers have been introduced as of February 2025 to help recover production in areas affected by extreme weather and disease outbreaks. Affected farmers and agricultural enterprises will receive direct support for replanting crops, restoring damaged livestock and aquaculture systems, and rehabilitating agricultural infrastructure. The eligibility criteria for support were expanded, ensuring that smallholder farmers and co-operatives in high-risk areas receive timely assistance. Additional preventive measures, including the promotion of climate-resilient crop varieties and improved pest control management have been emphasised.

In June 2024, the government issued a decision to advance the development of a circular economy in agriculture, using science and technology to optimise resource use, reduce waste, and promote sustainable farming practices. The decision encourages innovation in crop production, livestock farming, and aquaculture, focusing on renewable energy, organic waste recycling, and precision farming. Research institutions, enterprises, and co-operatives are provided with support for developing biogas systems, organic fertilisers, and efficient irrigation technologies. In addition, the National Action Plan for Circular Economy was adopted in January 2025, and includes a strategic framework to enhance resource efficiency and minimise environmental impact across key sectors, including agriculture, energy, manufacturing, and waste management. The plan aims to establish sustainable production and consumption systems by optimising resource utilisation, promoting material reuse, and reducing waste.

In September 2024, the government introduced a decree to enhance the productivity and sustainability of rice farming while ensuring the long-term stability of the rice sector. It provides financial support for rice producers along with new infrastructure investments, and regulations on land-use conversion to maintain the integrity of rice-growing areas. Under this policy, state budget funding is allocated to rice-producing areas. Farmers cultivating specialised rice land receive VND 1 500 000 (USD 61) per hectare, while other rice cultivation areas, excluding spontaneous upland rice fields, are granted VND 750 000 (USD 31) per hectare. An additional VND 1 500 000 (USD 61) per hectare is provided for specialised fields designated for high-yield and high-quality rice production. New financial incentives aimed at promoting sustainable and high-tech rice production were introduced, covering up to 40% of project costs, with a maximum cap of VND 15 billion (USD 614 000) per project. This funding is designated for investments in equipment, technology, and technology licenses that align with the national sustainability and climate goals.

Trade policy developments in 2024-25

The free trade agreement between Viet Nam and Israel (VIFTA) was signed on 25 July 2023, and came into force in November 2024. It removes duties on at least 86% of Vietnamese products and 93% of Israeli products. Bilateral trade turnover is projected to increase from USD 2.2 billion in 2022 to an estimated USD 3 billion, as Vietnamese tropical products, including seafood, are exported to Israel for processing and as Israel gains access to ASEAN countries (VCCI, 2023[6]; VCCI, 2024[7]).

The Viet Nam-UAE Comprehensive Economic Partnership Agreement (CEPA), the first free trade agreement between Viet Nam and an Arab country, was signed on 28 October 2024, and is expected to be ratified in Q1 2025. It will progressively remove tariffs on 99% of UAE exports and 98.5% of Vietnamese exports, with immediate tariff removals on several key Vietnamese exports, including agricultural products such as cashew nuts, pepper, and honey. In the first eight months of 2024, the bilateral trade reached over USD 4.47 billion, a 45% increase compared to the same period in 2023 (VCCI, 2024[8]).

Policy context

Key economic and agricultural statistics

Viet Nam is a mid-sized country in terms of land area, but its population of over 101 million makes it the 16^th most populous country in the world. Viet Nam is classified as a lower middle income country, and almost two-thirds of the population live in rural areas. Since the reforms of Doi Moi in the mid-1980s, the country has seen strong and steady growth in GDP, in the order of 5-7% annually from 2000-19 (Figure 30.3). GDP growth slowed in 2020-21 as a result of the COVID-19 pandemic, but a recovery in exports and domestic demand led to a rapid rebound, with growth reaching 5% in 2023.

Agriculture contributes 12% to Viet Nam’s GDP and employs 33% of the labour force, although the relative importance of agriculture in the economy is declining. The sector has undergone significant structural changes in recent decades, reflecting a shift away from staple foods to export commodities, such as rubber and cashew nuts, and to livestock production, particularly pig meat. Crops dominate the agricultural landscape, accounting for 63% of total agricultural production in 2023 (Table 30.2). Rice alone plays a dominant role, accounting for around one-quarter of the value of agricultural production.

Table 30.2. Viet Nam: Contextual indicators

	Viet Nam		International comparison
	2000*	2023*	2000*	2023*
Economic context			Share in total of all countries
GDP (billion USD in PPPs)	202	1 503	0.5%	1.0%
Population (million)	77	100	1.8%	1.9%
Land area (thousand km2)	310	313	0.4%	0.4%
Agricultural area (AA) (thousand ha)	8 780	12 315	0.3%	0.4%
			All countries1
Population density (inhabitants/km2)	246	320	52	64
GDP per capita (USD in PPPs)	2 614	14 974	9 368	29 013
Trade as % of GDP	49.5	88.8	12.3	14.9
Agriculture in the economy			All countries1
Agriculture in GDP (%)	22.7	12.0	2.9	3.5
Agriculture share in employment (%)	65.3	33.0	-	-
Agro-food exports (% of total exports)	16.9	6.1	6.4	8.1
Agro-food imports (% of total imports)	6.1	9.7	5.8	7.3
Characteristics of the agricultural sector			All countries1
Crop in total agricultural production (%)	77.9	62.8	-	-
Livestock in total agricultural production (%)	22.1	37.2	-	-
Share of arable land in AA (%)	70.6	54.8	31.8	33.3

Note: *or closest available year.

Average of all countries covered in this report. Agro-food trade includes natural rubber.

Sources: OECD statistical databases; International Labour Organisation (ILO); UN Comtrade; World Bank, WDI; FAO database and national data.

With the progressive liberalisation of trade, the value of imports and exports has increased substantially since the early 2000s (Figure 30.4). Agro-food imports, in particular, saw a sizeable jump in recent years, increasing from USD 22.4 billion in 2020 to USD 34.9 billion in 2022. The value of agro-food exports has also steadily increased, reaching USD 22.6 billion in 2022. Viet Nam is one of the world’s largest exporters of a range of agricultural commodities, including rice, coffee, tea, cashew nuts, black pepper, natural rubber and cassava. However, exports often sell at a discount compared to the same commodities from other leading exporters due to quality differences.

Over 60% of Viet Nam’s agro-food exports are delivered as primary or processed goods for household consumption. In contrast, 70% of agro-food imports are used as primary or processed inputs for industry, rather than for household consumption. Key imports into production include livestock feedstuffs, such as oil cake and maize, and raw commodities for further processing and export, including cotton and cashew nuts. The remaining 30% are products to meet food demand from domestic consumers, including higher-value foods and beverages.

Agricultural output increased by 3.0% per year from 2013-22 (Figure 30.5). This was largely driven by total factor productivity (TFP), which grew at 2.7% per year, far outpacing the world average TFP growth of 0.8% over the same period. The increased use of intermediate inputs also contributed to output growth, while the contribution of primary factors (labour, land and capital) declined slightly.

However, agricultural production gains have been accompanied by significant pressure on natural resources. The nitrogen and phosphorus balances for Viet Nam exceed the OECD average for the period 2013-22 by a factor of 3.9 and 12.7, respectively. Agriculture’s share in water abstractions is 95%, substantially higher than the OECD average of 50%. The share of agriculture in total GHG emissions is three times greater than the OECD average, although agriculture accounts for a larger share in the country’s economy. The environmental degradation of production in Viet Nam poses a risk to agricultural production and the capacity of the sector to support sustainable productivity growth in the future.

Table 30.3. Viet Nam: Productivity and environmental indicators

	Viet Nam		International comparison
	1991-2000	2013-2022	1991-2000	2013-2022
			World
TFP annual growth rate (%)	2.4%	2.7%	1.7%	0.8%
			OECD average
Environmental indicators	2000*	2023*	2000*	2023*
Nitrogen balance, kg/ha	164.1	116.9	32.0	29.7
Phosphorus balance, kg/ha	29.9	31.7	3.3	2.5
Agriculture share of total energy use (%)	1.7	4.9	1.7	2.0
Agriculture share of GHG emissions (%)	47.9	31.6	8.7	10.1
Share of irrigated land in AA (%)	..	..	-	-
Share of agriculture in water abstractions (%)	94.2	95.0	47.0	49.5
Water stress indicator	..	..	8.7	..

Note: * or closest available year.

Sources: USDA Economic Research Service, Agricultural Productivity database; OECD statistical databases; FAO database and national data.

Historical trends in agricultural policies

Following its declaration of independence in 1945 and ensuing reunification into the Socialist Republic of Viet Nam in 1975, the Communist Party of Viet Nam initially structured the country according to the Soviet model, which was grounded in central planning and self-reliance. Within this context, agriculture’s primary role was to support the development of heavy industry by providing food at low prices and achieving food self-sufficiency (OECD, 2015[9]). Production was organised around co-operatives and state farms, with SOEs providing inputs and controlling output markets. By the mid-1980s, food shortages and famine were pervasive, as was inflation.

A long series of reforms embedded within the economy-wide programme known as Doi Moi or “Renovation” progressively liberalised Viet Nam’s economy and its agricultural sector starting in 1986 (OECD, 2015[9]). The paradigm evolved toward a “law-ruled socialist market economy” in which the development of agriculture, forestry, and fisheries became a priority for stabilising the economy. The model for agricultural management shifted from co-operatives to farm households, with farmland redistributed in the form of land use rights, and farm households given the ability to make their own production decisions provided they met certain production quotas. By 1992, prices for most goods and services were determined by markets, though regulation remained for certain commodities, such as fertiliser, sugar, and rice.

From 1993-2000, Viet Nam underwent a period of expansion, in which the country increasingly opened to trade and integrated into the global economy. Reforms introduced more market-oriented policies with the aim of expanding food production for export. A number of these reforms aimed to improve investment and technological innovation, including the 1993 Land Law, the establishment of a national extension service, and credit access for rural households. The Price Stabilisation Fund (PSF) was established to regulate the prices of certain commodities, including urea, paddy and rice, coffee, and sugarcane.

During this period, Viet Nam entered into bilateral and regional trade agreements and partnerships to expand market opportunities, including its accession to the Association of Southeast Asian Nations (ASEAN) in 1995 and its admission to the Asia Pacific Economic Community (APEC) in 1998. Most importantly, the country relaxed restrictions on the export of rice as well as internal barriers to trade between the south and the north. The country saw strong and steady growth throughout the 1990s, in terms of real GDP (7.4% per year) and agricultural output (6% per year), with the relaxation of production quotas, price controls, collectivised agriculture, restrictions on trade and investment, and bans on private enterprises (OECD, 2015[9]; World Bank Group, 2016[10]). The budgetary expenditures for agriculture quadrupled during this period, with several large-scale projects implemented, such as the Building Canals for All Rice Fields programme (Phan, 2014[11]; Ellis et al., 2010[12]).

From 2000-08, the policy framework aimed to stimulate agricultural and rural modernisation and industrialisation by improving yields, quality, and the value of production. Further international integration, including accession to the WTO in 2007, reinforced previous reforms. The remaining few quantitative restrictions on agricultural imports and exports were progressively withdrawn but it was not until the late 2000s that private sector involvement in rice exports was encouraged. Prior to this point, the right to export was limited to national and provincial SOEs.

Since 2008, three major resolutions have guided and reoriented agricultural policy development in Viet Nam. The first, the Tam Nong Resolution, emphasises the advancement of agriculture, rural development, and farmer livelihoods based on a socialist market economy. Alongside this, a resolution to ensure national food security was issued in response to sharp increases in food prices from 2007-09. The resolution sought to ensure national food security by guaranteeing adequate food supplies, particularly for rice. It set specific targets to preserve land in the production of rice and to ensure a farm-gate price such that growers are guaranteed a certain profit margin above production costs. In March 2021, this resolution was updated through 2030 to stabilise 3.5 million ha of land in rice production and to ensure an average profit of 35% above estimated production costs. Thirdly, Resolution No. 19/2022/NQ-TW, focuses on accelerating agricultural production, enhancing rural development, and improving farmers’ livelihoods amidst industrialisation, globalisation, and climate change. It emphasises building a green, sustainable agriculture, large-scale production, applying science-technology, enhancing quality and added value, and improving agricultural infrastructure.

Table 30.4. Viet Nam: Agricultural policy trends

Period	Framework	Changes in agricultural policies
1976-1986	Reunification: Socialist centrally planned system	Centrally planned economy, including the agricultural sector Agricultural production organised into co-operatives that also administered land Upstream and downstream sectors reorganised as state-owned enterprises
1986-1993	Renovation (Doi Moi): Launch of reforms to transition Viet Nam to a socialist-oriented market economy	Farm households replace co-operatives as focus of agricultural and rural development Role of co-operatives reduced: farmers allowed to make production decisions; co-operatives limited to trading and providing services (e.g. irrigation) Economy opened to trade Reduced government control over prices, although prices regulated for some products (including fertiliser, sugar and rice)
1993-2000	Expansion: Further reforms to expand food production and exports	Land Law 1993; land use rights extended to 20 years (annual crops) and 50 years (perennial crops) Land use tax replaces production quota and agricultural output tax Rural households allowed to borrow loans from commercial institutions Price Stabilisation Fund for essential commodities Restrictions on rice exports relaxed Increased budgetary expenditure for agriculture
2000-2008	Consolidation: Policies to promote agricultural and rural modernisation and industrialisation	Policies to encourage production of primary and processed commodities, quality improvement, domestic and international trade, and increase investments from various sources in physical and social infrastructure Regional and bilateral trade agreements WTO accession
2008-present	Reorientation: Shift in emphasis from extensive development of agriculture based on quantity to one focused on quality and efficiency improvements	Agricultural policy guided by three major resolutions: - Resolution No. 26/2008/NQ-TW on agriculture, farmers and rural areas (Tam Nong) - Resolution No. 63/2009/NQ-CP to ensure national food security implemented through the master plan for agricultural development (2012) and the agricultural restructuring project (2013) - Resolution No. 19/2022/NQ-TW on agriculture, farmers and rural areas to 2030 with a vision to 2045

Support provided to Viet Nam’s producers has declined steadily since 2009, largely driven by changes in MPS (Figure 30.6). Since 2014, the %PSE has remained negative, dropping to around -11% in 2018 and remaining at that level since. Total support to agriculture (TSE) has also been negative over the same period, as budgetary transfers to producers and expenditure on general services do not compensate for the high levels of negative MPS.

References

[4] Agroberichten Buitenland (2021), Vietnam’s Agriculture Grows Up Thanks to EVFTA, https://www.agroberichtenbuitenland.nl/actueel/nieuws/2021/04/26/vietnam%E2%80%99s-agriculture-grows-up-thanks-to-evfta.

[12] Ellis, K. et al. (2010), Assessing the Economic Impact of Competition: Findings from Vietnam, https://media.odi.org/documents/6060.pdf.

[3] Gray, E. and D. Jones (2022), “Innovation, agricultural productivity and sustainability in Viet Nam”, OECD Food, Agriculture and Fisheries Papers, No. 181, OECD Publishing, Paris, https://doi.org/10.1787/9cc1f47a-en.

[2] OECD (2022), OECD Review of the Corporate Governance of State-Owned Enterprises in Viet Nam, Corporate Governance, OECD Publishing, Paris, https://doi.org/10.1787/a22345d0-en.

[9] OECD (2015), Agricultural Policies in Viet Nam 2015, OECD Food and Agricultural Reviews, OECD Publishing, Paris, https://doi.org/10.1787/9789264235151-en.

[11] Phan, S. (2014), “A Qualitative Review of Vietnam’s 2006-2010 Economic Plan and the Performance of the Agriculture Sector”, Asian Journal of Agriculture and Development, Vol. 11/1, pp. 39-63, https://doi.org/10.37801/ajad2014.11.1.3.

[7] VCCI (2024), “Conference: Introducing the Vietnam-Israel Free Trade Agreement (VIFTA)”, Vietnam Center for WTO and International Trade, https://wtocenter.vn/su-kien/26615-conference-introducing-the-vietnam-israel-free-trade-agreement-vifta (accessed on 18 February 2025).

[8] VCCI (2024), “Vietnam-UAE Comprehensive Economic Partnership Agreement (CEPA): Key Details”, Vietnam Center for WTO and International Trade, https://wtocenter.vn/chuyen-de/26216-vietnam-uae-comprehensive-economic-partnership-agreement-cepa-key-details (accessed on 27 May 2025).

[6] VCCI (2023), “FTA opens up opportunities in Israeli market: experts”, Vietnam Center for WTO and International Trade, https://wtocenter.vn/chuyen-de/22455-fta-opens-up-opportunities-in-israelimarket-experts (accessed on 19 March 2024).

[5] Vo, T. et al. (2020), “Methane Emission Factors from Vietnamese Rice Production: Pooling Data of 36 Field Sites for Meta-analysis”, Climate 2020, Vol. 8/10, https://doi.org/10.3390/cli8100113.

[10] World Bank Group (2016), Transforming Vietnamese Agriculture: Gaining More from Less. Vietnam Development Report, World Bank, Washington, DC, http://hdl.handle.net/10986/24375.

[1] WTO (2024), World Tariff Profiles 2024, https://www.wto.org/english/res_e/publications_e/world_tariff_profiles24_e.htm.

Notes

← 1.  The RCEP countries are Australia, Brunei, Cambodia, China, Indonesia, Japan, South Korea, Laos, Malaysia, Myanmar, New Zealand, the Philippines, Singapore, Thailand, and Viet Nam.

← 2.  Producers of these commodities are implicitly taxed in that they receive prices lower than world prices for their outputs, resulting in a negative MPS.

← 3.  The VRG, one of the top ten largest listed companies across all sectors, controls 40% of the land in rubber plantations nationally and 85% of total export production (state ownership ratio 97%). Vinafood II is the country’s largest exporter of rice, with the capacity to process 3 million tonnes per year, and is also an exporter of cassava, maize, beans, cashew nuts, and coffee (state ownership ratio 51%). Vinacafe accounts for 20-25% of coffee bean exports, as well as exports of peppers and cashew nuts, and imports of fertilisers for coffee production (state ownership ratio 100%). Vinatea (converted to Viet Nam Tea Corporation Joint Stock Company by decision of the Prime Minister) owns 4 300 ha of land in tea production (the largest concentrated area in the country) and produces up to 10 000 tonnes of dry tea per year, with exports to 15 countries. State ownership ratios from (OECD, 2022[2]).

← 4.  Export restrictions for rice provide a policy rationale for negative MPS values until 2017. After that point, formal export restrictions no longer legally apply, but some restrictions remain in terms of maintaining rice reserves. The ongoing presence and role of SOEs in the trade of rice and other export commodities is the most likely explanation for negative MPS values since 2017.

← 5.  For example, foreigners may retain a LUR for 50 years, while locals may hold one indefinitely.