The State Bank of Vietnam, the Ministry of Agriculture and Rural Development and the Ministry of Science and Technology are considering cooperation on a pilot programme for financing connectivity models between businesses and farmers in order to promote high technology application in agricultural production and exports, the Vietnam Economic News reported on June 3.

Director of the Credit Department under the central bank Nguyen Viet Manh said that there have been many agricultural production models promoting connectivity between businesses and farmers nationwide.

A number of those have proved successful, including the large-scale rice field model in An Giang province and other localities, the hi-tech vegetable and flower cultivation one in Lam Dong province, and the dairy farming and milk product production one in Nghia Dan in Nghe An province, among others.

With those models, businesses not only created large scale rice fields and mechanised agricultural production but also had stable raw material production areas and constructed trademarks and geographical indications for their products in both domestic and foreign markets. The models benefited both farmers and businesses.

At a Government's regular meeting in February 2014, SBV Governor Nguyen Van Binh suggested the construction of a credit programme for connectivity models and high technology application and farm export promotion projects.

Through its Resolution 14/NQ-CP, the Government assigned the central bank to work with the Ministry of Science and Technology and the Ministry of Agriculture and Rural Development to implement a pilot credit programme for connectivity models. These three institutions are working together to survey, research and construct experimental policies for a large scale application.

Manh said the pilot credit programme will reduce the input costs for the connectivity models’ products through offering preferential credit for the models. The programme could provide unsecured loans for businesses and farmers as members of a connectivity model.

With this pilot programme, the banking sector can not only increase credit growth related to agricultural production but also promote large-scale, competitive agricultural production, contributing to gradually improving farmers' living standards and constructing and developing new rural areas.

Manh said the bank, the Ministry of Science and Technology, the Ministry of Agriculture and Rural Development and credit institutions were expected to select about 20 connectivity models as the pilot credit programme’s beneficiaries.

These include the large-scale rice field model, the product value chain-based connectivity model and the high technology applying business model, among others, with priority given to rice, seafood, livestock breeding, vegetable and fruit.

About two years after the pilot credit programme finishes, the SBV will consider policy improvements and multiplication of the models.

Manh added that agricultural insurance policies, farm produce planning and its management, farm export promotion and law-based assistance and market information are important for the pilot credit programme’s success.-VNA