TITLE: Vietnam and Philippine Agriculture Fall Prey to Globalization of Land Rights

AUTHOR: Shirley Nuevo

PUB:

DATE: March 1, 2001

What awaits socialist Vietnam in a highly globalized economic environment? Since the start of the doi moi (renovation) in its agriculture sector in the eighties, Vietnam developed from a food deficit nation to one of Southeast Asia's most active food exporting countries. A key factor then was the country's agrarian reform program and 'cooperativization' of farm production. Now, socialist Vietnam is moving towards a radical reform: opening up land control to foreigners. The Vietnamese government believes such step would bring in more investments to agriculture and pump up the lifeline of the economy. But peasant groups within and outside Vietnam are wondering whether the country is stepping into the right direction. Close comparison with the Philippine situation, for instance, would prove that things might not turn out as expected. Land to foreigners? With the vigorous implementation of capitalist reforms in the Vietnamese economy, like legal guarantees to foreign investments and the sale of government-owned assets, many foreigners have been tempted to invest in a "renovated" socialist Vietnam. Still many remained unsatisfied. Creditors and foreign investors have repeatedly criticized the government for the slow pace of reforms. Many, in fact, have threatened to withdraw investments from Vietnam. In a bold bid to keep the investors, the government is staking its lands via the new law. Like its neighbor the Philippines, Vietnam as of yet does not allow foreigners to own land. But the setup is bound to change as soon as Vietnam's legislature, the National Assembly, passes the new land law anytime within the first half of the year. Under the proposed law, foreign investors in Vietnam will be allowed to buy land-use rights from government or commission Vietnamese farmers to produce specified crops by forming joint venture agreements with them. Foreign partners are expected to provide technical and financial assistance, while local farmers will offer their land and provide labor. The proposed law will virtually transfer land control from farmers to foreign agro-investors. Similar arrangements are common in the Philippines, where the contract-growing scheme had been widely practiced in the last two decades. Contract growing in the Philippines is an arrangement in which an agriculture-based foreign company transfers farm production process to local independent farmers or farmers' groups. In the prevailing contract growing practice in the Philippines, the foreign partner normally specifies which crop to plant, impose a standard quantity and quality and dictate the price of the crop. Contract growing has been widely practiced in large plantations, particularly in Mindanao and the Visayas. Local peasant groups like the Kilusang Magbubukid ng Pilipinas (KMP) criticize the practice for driving many farmers to bankruptcy and perpetuating unfair labor practices against farmhands and agricultural workers. Similar views Recently, the KMP shared the views of a visiting Vietnamese economist here that the proposed land law in Vietnam may bring in more adverse affects than boost the country's agriculture. In a series of lectures given in the University of the Philippines in Diliman early this month, Dr. Bui Tat Thang, an economics professor from Hanoi University attributed to the cooperative program Vietnam's ascent in the nineties as one of the region's biggest rice-exporting countries. In 1996, Vietnam's agriculture sector comprised 29 percent of its gross domestic product (GDP), much bigger than the Philippines 22 percent. In the same year, Vietnam's rice production reached 28 million metric tons of rice, more than double the Philippines' 11 million metric tons. This despite the fact that agricultural land in the Philippines, which comprises 31 percent of the total land area, is far bigger than total agricultural land in Vietnam which comprise only 22 percent of its total land area. Vietnam's land reform and agriculture production policy spelled the big difference, affirmed Dr. Thang. Although both countries were deeply entrenched in feudalism as a result of western colonization-Vietnam by the French for almost a century and the Philippines by the Spaniards and Americans for almost 400 years-Vietnam was able to free itself from the clutches of feudalism much earlier. Land in Vietnam is owned by the state. The assumption to power of the Communist Party, first in Northern Vietnam in 1954 and later on including South Vietnam in 1976, boosted land reform at a vigorous pace all over the country. Vietnam's land reform program, implemented for a span of six years in the North and five years in the South, has effectively ensured land for every Vietnamese tiller. Private ownership of land was eventually abolished and instead, the people were allowed to secure land-use rights for a specified period. This is a stark contrast compared to the dismal seven decades of land reform program of the Philippines, starting under the American colonial government. Until now, the biggest land parcels in the Philippines is owned and controlled by less than 5% of the entire population. Yet despite his country's impressive agriculture performance, Dr. Thang said the Vietnamese government is open to foreign investments in agriculture. But he was quick to point out that not all Vietnamese, particularly farmers, were as interested. The Vietnamese government's eagerness to tempt foreigners to invest in agriculture is driven by the desire to produce more for the international market and to modernize further its agriculture sector through technology transfer, according to Dr. Thang. Vietnam's agriculture directly employs about a third of its entire population. Undeniably, the effects against Vietnamese peasants would be great should foreigners be allowed to directly buy land-use rights from the government or form joint venture agreements. The passage of the law would also entail the abandonment of the impressive gains of socialist Vietnam's land reform program. In the long run, the opening of land control to foreigners would pose a serious threat to food security since foreign investors will be more interested in producing export-viable crops than staple crops. From a food sufficient country in the early sixties, the Philippines had been transformed into a grains-deficit country, particularly in the last two decades as transnational corporations and big agribusiness for export took over the agriculture sector. Narrowing markets and competition for foreign investors among developing nations have intensified as a result of globalization of land rights, or the opening up of trade and investment in agriculture. Poor agriculture-based nations--'socialist' and non-socialist economies alike-are clearly the biggest casualties of this free trade setup. END top