Anticipating forthcoming agricultural cooperation prospects between Vietnam and Russia

Starting from 2016, Russia has witnessed a significant increase in agricultural exports, exceeding the value of military exports with an amazing sum of USD16 billion. In 2021, the value had increased to USD38 billion and continued to rise to over USD40 billion in 2022. Russia's agricultural exports in 2023 reached a value of over USD50 billion, which was equal to Vietnam's. Given its current speed, Russia is poised to join the ranks of the top 10 agricultural exporters globally.

Nevertheless, the level of agricultural collaboration between Vietnam and Russia is still restricted. The primary focus of activities is centered around trade, research and technology, and technical cooperation. Russian FDI in Vietnam is insignificant, although Vietnamese investment in Russia is notable due to the TH True Milk dairy farming project, which amounts to USD2.7 billion.

In order to foster agricultural collaboration, officials from the Ministry of Agriculture and Rural Development (MARD) and relevant departments have engaged in multiple meetings and dialogues with Russian agricultural leaders, ambassadors, and experts. The objective of these interactions is to address trade obstacles and explore avenues for enhanced cooperation. On June 13, 2024, Deputy Minister of MARD Tran Thanh Nam held a meeting with the Russian Ambassador to evaluate the current state of cooperation, address any existing concerns, and enhance collaboration in the present circumstances.

In September 27-29, 2023, the Directorate of Fisheries (MARD) participated in the 6th International Forum on Fisheries and Seafood Technology Exhibition in Russia. At this event, the delegation collaborated with the Russian Federal Fisheries Agency to strengthen bilateral collaboration, promote seafood trade, and negotiate changes to certain parts of fisheries cooperation as outlined in the 1994 Protocol between the two governments.

In July 2023, the Plant Protection Department dispatched a delegation to Russia with the purpose of examining the quality and safety protocols for grains. The objective was to strengthen collaboration and regulate the shipment of Russian wheat to Vietnam. As per Circular No. 04/2023/TT-BNNPTNT issued on August 15, 2023, by the Minister of MARD, the quarantine requirement for field thistle has been lifted, making it easier to import wheat from Russia.

However, the Federal Service for Veterinary and Phytosanitary Surveillance (FSVPS) of Russia now acknowledges 57 Vietnamese seafood processing plants as compliant with the safety regulations for exporting to Russia and the Eurasian Economic Union.

In total, the agricultural, forestry, and fishery commerce between the two countries amounts to around USD1 billion, which represents 20% of the whole import-export value between the two sides. Vietnam exports coffee, fish, fruits and vegetables, pepper, tea, cashew nuts, and timber to Russia. In contrast, Russia sells seafood, wheat, fertilizers, and frozen meat to Vietnam as exports.

The USD2.7 billion high-yield dairy farm project by TH True Milk Group in Russia is a notable example of collaboration between the two companies in the field of investment. Robust assistance is required to guarantee the triumph of this effort and to duplicate analogous frameworks.

The level of agricultural collaboration between the two nations has increased twofold over the previous five years, but it is presently experiencing a decline as a result of challenges pertaining to payment and transportation. There is still a considerable opportunity for collaboration within the context of long-standing amicable relations and an all-encompassing strategic alliance.

As reported by the General Department of Vietnam Customs, there was a significant increase in the shipment of agricultural products to Russia during the initial five months of 2024. The agricultural export turnover amounted to USD331.3 million, reflecting a 49.7% increase compared to the corresponding time in the previous year. Coffee sales amounted to USD161.6 million, representing a 39% increase. Seafood sales reached USD76.4 million, showing a significant growth of 87.7%. Cashew nuts sales were USD28 million, experiencing a substantial increase of 81.8%. Lastly, fruits and vegetables sales totaled USD26.8 million, with a moderate growth of 25.2%. Additionally, there was notable development in other commodities such as rubber, wood and wood products, rice, and pepper.

Vietnam and Russia have made notable achievements in agricultural collaboration. Nevertheless, in order to fully maximize the potential, it is imperative to implement more robust and synchronized initiatives to tackle existing obstacles and bolster mutual investment and trade.