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EVENTS: Mekong Delta has much room for food processors

The Mekong Delta region’s food processing sector has great growth potential owing to an abundance of produce there, but investment in the sector there remains modest, heard a conference in Can Tho City on December 12.

Nguyen Phuong Lam, deputy director of the Vietnam Chamber of Commerce and Industry (VCCI)’s branch in Can Tho City, stressed at the conference on promoting investment to expand the food value chain that the delta has much room for food processors.

He said the region is home to 20% of the country’s population and boosts gross domestic product (GDP) per capita of an estimated USD2,700 in 2017, which suggests the region may have strong purchasing power in the future.

He added the region has the average export turnover of around USD13-15 billion a year. Its main products are rice, seafood, and fruit which account for around 50% of outbound sales of the agricultural sector, equivalent to USD6.5-7.5 billion per year.

According to Lam, the region is also known as a major agricultural production region. For example, the Mekong Delta accounts for 90% of the country’s commercial rice output, and seafood including shrimp and tra (pangasius) fish at 3.5-4 million tons a year. “This is one of the competitive edges which will help prop up the growth of the local food processing sector in the future,” he stressed.

However, he said, as of the end of last year, the region had had only 35 projects worth USD550 million in the food processing sector.

Mr. John G Keogh – Supply Chain Expert from Bluewave

Mr. Vo Sang Xuan Vinh, deputy director of Bluewave Advisory Co Ltd

Vo Sang Xuan Vinh, deputy director of Bluewave Advisory Co Ltd, said financial investors who pour money into food chains pay more attention to partners whose financial models are good. In addition, their business performance should be fine and their segments fall into the highest added value.

“Within a value chain, investors keep an eye on the food processing stage which turns out value-added products,” Vinh said.

He added investors pay more attention to food processing enterprises that have strong brands, have the ability to export their products, and make their products certified by international agencies available in local distribution systems.

Source: http://english.thesaigontimes.vn