Land bank needed for agricultural development

It is necessary to establish a land bank because the majority of the 27 million ha of farmland in Vietnam is owned by individual farmers, which has created a host of difficulties for high-tech agriculture, Mr. Mai Van Phan, Deputy Director General of the Land Registration Department at the Ministry of Natural Resources and Environment (MoNRE), said on August 14.

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Mr. Phan’s proposal is in the context of high-tech agriculture struggling to accumulate land for large-scale production.

According to the latest figures from MoNRE, the country currently has 27 million ha of agricultural land, of which 55 per cent is under farm management and only 10 per cent belongs to economic organizations. The process of land consolidation for large-scale public agricultural production has been slowing.

Land fragmentation is a major obstacle to long-term investment in agriculture, especially in high-tech agriculture.

According to Mr. Phan, the construction of an agricultural land bank would create a mechanism for developing land funds for agricultural development on a large scale. A land bank requires the building of a comprehensive, scientific, transparent, and accessible information system, as well as policies to encourage the lease of land use rights.

Land is said to be one of the greatest obstacles facing investors in Vietnam’s agriculture sector, which is one reason why foreign investment inflows remain modest. According to the Foreign Investment Agency at the Ministry of Planning and Investment, although 2016 was an impressive breakthrough year for the agriculture sector, foreign direct investment (FDI) into the sector fell short of expectations.

The country attracted nearly 550 agriculture FDI projects, including in agriculture, forestry and fishery, in the first eleven months of 2016, with total capital of nearly $4 billion, representing just 1.2 per cent of total investment. Average capital per project stood at about $6.7 million. 

Prime Minister Nguyen Xuan Phuc recently tasked MoNRE with quickly identifying solutions to address the limitations inherent in agricultural land ownership to boost land accumulation for large-scale farming and production in the third quarter of this year.

This follows a request from the National Assembly (NA) to amend the 2013 Land Law in order to lift land limits, which was good news for domestic and foreign investors involved in Vietnam’s agricultural sector.

Ha Nam in Vietnam’s north was one of the first provinces to successfully implement the land accumulation model for large-scale and hi-tech agricultural development. After three years of applying the model, the province has secured over 400 ha of agricultural land from farming households in Binh Luc and Ly Nhan districts, which attracted major groups such as Vingroup and Vinaseed as sub-lessors. 

VN Economic Times

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