Visit and Interview Activity Project “Capacity Building on Food Security in Agro-Processing Industry among Mekong Countries and People’s Republic of China” Supported by Mekong - Lancang Cooperation Fund, People’s Republic of China 19 - 22 September 2023, Ho Chi Minh City, Vietnam

The Royal Thai Consulate-General, Ho Chi Minh City
Ho Chi Minh City and provinces nearby accumulate the highest foreign direct investment in the fields of energy, electricity, food and beverages-especially snacks, clothing, petroleum, chemicals, service sectors, banks, department stores, retail stores, and industrial estates. Important foreign investors include Korea, Japan, Singapore, China, and Thailand. Their production mostly produce for domestic consumption as Vietnam is a large market with population of more than 100 million people. In term of local SMEs, it accounts for 90 percent which they process only primary agricultural products such as dry fruit. Important agricultural products in Vietnam are rice, grains, dragon fruit, lychees, cashew nuts, lotus seeds, and pepper. Potential processed foods are multi-grain snacks, snacks containing cashew nuts, lotus tea, macadamia, and fish sauce. The government also place importance in BCG economy and intent to develop SMEs outstanding products at the provincial level.

Department of Agriculture and Rural Development, Ho Chi Minh Office
In Ho Chi Minh city, there are many huge cultivation areas of ​​rice, vegetables, and fruits. However, the production is still not sufficient to meet the consumption needs of the population since Ho Chi Minh City contains 17 million people including populations from other provinces who migrate for labor force. As a result, there are additional agricultural products needed to be imported from neighboring provinces. The main agricultural products include rice, mangoes, oranges, pineapples, mangosteen, bananas, guavas, rose apples, and dairy products. For the processing of agricultural products, only basic processing such as drying and seasoning. For packaging, they also require support in developing designs that are modern and meet market needs.

Thai Chamber of Commerce and Industry in Vietnam
Vietnam mainly emphasizes its agricultural cultivation in domestic consumption and only export 15 percent of the product. The main agricultural products of Vietnam are rice, mango, durian, lychee, coffee, pepper, and fresh vegetables while main processed products are dried fruits and fruit juices. The government has decentralized its power for each province to issue investment promotion policies autonomously and pushing for products with growth potential in each area. For macro policy, Vietnam place importance to the biological industry, environmental protection, renewable energy, and food safety. The potential industrial sectors are electronics, automobiles, and food processing. Regulations are strictly enforced and frequently updated in Vietnam. In addition, Vietnamese people are confidence in Thai products, especially in food and beverages.

S.T.Food Marketing Company
S.T.Food Marketing Company is 100% share holder by Srinanaporn Marketing Public Company Limited (SNNP) of Thailand. The production in Vietnam started in September 2022 on a factory area of ​​20,000 square meters. The factory covers a raw material warehouse, production process, and finished product warehouse. Currently, there are 3 products i.e. 1) Powder snack under “Lotus” brand, squid and fish strips under “Bento” brand, and ready-to-drink jelly and carrageenan jelly under “Jele” brand. The raw materials use are all from local ingredients in Vietnam. The brand name remains in Thai to meet consumer confidence with Vietnamese text labelling were added as required by law. The company has a main policy of maintaining standards in the production process as done in Thailand. Both public and private sectors of Vietnam manage the infrastructure in the industrial estates including protection of energy risks and long-term urban planning. Vietnam has a policy to mainly supports the use of domestic labor. In general, wages are still lower than in Thailand but there is a tendency to increase in the future.

Study on economic and local conditions
1) Vegetable and fruit markets: Most of the markets are located in a specific area and some are by the streetside as the government’s regulations prohibit the obstruction of traffic. Overall agricultural products are similar to Thai market, such as mangoes, oranges, dragon fruit, rambutan, longan, lychees, bananas, lotus seeds, cashew nuts, peppers, and fresh vegetable which most of them are grown in the area around Ho Chi Minh City. Although some of them are imported from other provinces, especially Dalat, such as rambutan and longan. Most markets can be traded in both local currency and Thai baht.

2) Department stores: Department stores in Vietnam can be classified into Vietnamese cooperative shops (selling only Vietnamese products) and foreign department stores (selling both Vietnamese and foreign products). Agricultural products and fruits are divided into raw materials and cooking and processed products such as drying and canning. The overall quality and packaging are well condition. The department store trades both in US dollars and local currency.