Tra industry on the hook

15:15 | 19/03/2013

Most firms and farmers breeding and processing tra fish for export have incurred capital shortages, but Vietnam Tra Fish Association chairman Nguyen Viet Thang warns the industry could fall into the hands of foreign investors once it was overly opened to foreign investment.

Is capital distress the main cause of the  current tra breeding, processing and export crisis?

Businesses engaged in tra fish breeding, processing and export all source bank loans. Critical capital shortages incurred a year ago, when bank started restructuring. Currently, firms and farmers get little new loans since banks have tightened lending requirements. One should note that Resolution 11 presenting measures to curb inflation just demands credit restrictions to the  non-manufacturing sector. Banks, however, have tightened credit provision to manufacturing sector also, including tra fish production.

Tra fish processing and export were once booming. Why did the capital issue blight a burning story?

Tra fish breeding and processing requires enormous investment capital to circulate production. Firms need to spend on breeding areas, feedstuff, and plants for product and by-product processing. Each year, Vietnam exports more than one million tonnes of tra fish, but only one-third of this is exported under fillet form. We still need to go a long way to shape a complete tra fish production chain. Many firms got aware of this and began to partake in processing by-products like fishmeal, and animal feed, but this requires huge investments. In other words, much more investment capital is needed for sustainable tra fish development.

Should Vietnam leverage policies attracting foreign direct investment (FDI) businesses into this field?

Current FDI capital amount in this field is not remarkable but we must be cautious when calling for foreign investment into seafood. In the past, animal feed was also starved of capital and opened the door to foreign investment. In the upshot, entire animal feed market has fallen on the hands of foreign investors. Some FDI firms have invested in this field like CP and Cargill. They have turned out diverse breeds, injected capital into processing plants and will hook into making fish oil and fishmeal and so on in the coming time. FDI firms will jump into the field if we loosen this front.

Tra fish is a leading export item, but the export value has yet to commensurate with its status. Why?

Vietnam mainly exports tra fish under raw form as 90 per cent of export fillets are in frozen form. Firms have paid undue attention to product diversification and hiking product added values through shipping more processed items. Hence, in the coming time the sector should concentrate efforts into increasing processed items portion and by-product processing. We would extend production to 1.2-1.5 million tonnes after succeeding in boosting tra fish export value

What steps has the association taken for tra fish sustainable development?

Our task is to bridge fish farmers and producers to have in place unified development planning, having thorough grasp of information relevant to market and production, and averting the supply surpassing the demand. Our top target is to better quality and prices, but not only quantity.
 

Thuy Lien

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