General Status of Activities of Vietnam Agricultural Export Industry Associations Today

Thoroughly grasp some key viewpoints in innovating and perfecting the organization and viewpoints on perfecting the association's operating mechanism.

Thus, in Chapter I, we have had an overview of Associations, Industry Associations in general and Agricultural Export Associations in particular. We have studied in turn the aspects: concept, operation method, and functions of Industry Associations. In particular, we have studied very specifically the roles of Agricultural Export Associations and the experiences of some countries in developing Industry Associations, thereby drawing lessons for Vietnam. Thus, we can know through which activities the Association can promote its roles. This is the theoretical basis for us to be able to assess the current status of the role of the Vietnam Agricultural Export Association in Chapter II.

CHAPTER II. CURRENT STATE OF ACTIVITIES OF VIETNAMESE AGRICULTURAL EXPORT INDUSTRY ASSOCIATIONS

SOUTH TODAY

I. GENERAL STATUS OF ACTIVITIES OF ASSOCIATIONS FOR THE EXPORT OF AGRICULTURAL PRODUCTS IN VIETNAM TODAY

1. General introduction to Vietnamese agricultural export industry associations

Male

Along with the development of industry associations in general, the Association

The agricultural export industry began to emerge with the first establishment of the Vietnam Tea Association (VITAS). VITAS was established and officially operated on January 25, 1988, in the context of the country starting to carry out the renovation process. Sixteen founding units, including the Vietnam Tea Agricultural and Industrial Enterprises Union (now the Vietnam Tea Corporation) as the core, held the first Congress to establish the Association with the aim of widely linking economic sectors from central to local, state-owned and non-state-owned to participate in the production, processing, import-export and tea services according to the Party and State's guidelines.

Following the establishment of VITAS was the establishment of the Vietnam Food Association (VIETFOOD), formerly the Vietnam Food Import-Export Association. VIETFOOD was established on November 16, 1989, headquartered in Ho Chi Minh City. Currently, the Association's members annually export over 95% of the total export volume of the country and Vietnamese rice is present in all markets in Asia, Europe, America, Africa, and the Middle East.

Vietnam Coffee and Cocoa Association (VICOFA) was established on January 4, 1990 and recognized under Decision No. 28/KTĐN-TCCB dated January 22, 1990 of the Minister of Industry and Trade (now the Ministry of Industry and Trade). VICOFA was established on a voluntary basis to effectively coordinate and promote production and business activities, scientific research and promote cooperative relations with the international community. Like other industry associations, the formation and development of VICOFA aims to act as a bridge for "horizontal links" between businesses in the Coffee - Cocoa industry nationwide.

Up to now, most of our country's other key agricultural export products have established their own associations such as the Vietnam Cashew Association (VINACAS) established on November 29, 1990, the Vietnam Pepper Association (VPA) established at the end of 2001 and the Vietnam Rubber Association (VRA) started operating at the end of 2004.

Like many other industry associations, the Agricultural Export Association has made positive and important contributions to building industry development strategies, building management mechanisms, participating in preparing or supporting trade negotiations as well as resolving international disputes, implementing many trade promotion programs, organizing seminars and training courses to help businesses access and understand more about new requirements of the world market regarding the environment, social responsibility, labor safety, health, etc. The activities of the Agricultural Export Association are increasingly effective and are encouraged and promoted by the State.

Industry associations in general and agricultural product associations in particular have only really begun when our country transformed its economy into a market mechanism.

and open integration, although in a relatively short time, but in general, the Associations of Agricultural Export Products have become a place to gather businesses to promote production and export. Through the process of operation, the Associations of Agricultural Export Products have been increasingly enhancing their role towards member businesses, therefore, the number of members participating in these Associations is increasing.

However, the number of members in the Associations of Agricultural Export Products is very different. There are Associations with nearly 200 members, while there are Associations with only a few dozen members. For example, the Vietnam Tea Association has 155 members, while the Fruit and Vegetable Association has only 68 members. This is because Associations that have been established for a longer time often have more members. The total number of members of the Associations of Agricultural Export Products nationwide is 745 members.

Table 1: Basic information about agricultural product industry associations

Vietnam's exports

Association Name

Year of establishment	Current number of members
1. Tea Association	1988	155
2. Food Association	1989	104
3. Coffee - Cocoa Association	1990	146
4. Association of Cashew Nuts	1990	92
5. Pepper Association	2001	88
6. Fruit and Vegetable Association	2001	68
7. Rubber Association	2004	92

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Source: The author compiled from the Associations' Websites (March 2009)

2. General situation of the activities of agricultural export industry associations

2.1. Financial situation of the Associations

The Agricultural Export Association (AEA) is a voluntary and non-profit organization, and this characteristic governs the formation of the association's financial fund. The basis for forming the financial fund of these industry associations cannot be based on power, nor on business performance, but financial resources can only be mobilized from the benefits of association activities for members and for society. The financial resources that the association can mobilize to raise funds are:

(i) Mobilizing internal resources: membership fees, entrance fees and other contributions from members to serve the necessary activities of the association.

(ii) External mobilization: funding from organizations and individuals outside the association, cooperation programs, projects sponsored by international organizations.

(iii) Revenue from the association's service activities through public service activities permitted by the State, projects and research topics.

(iv) Support from the State budget: includes direct financial support from the budget or creating favorable conditions for working headquarters and indirect support through trade promotion program funding.

Thus, it can be seen that the financial resources that associations can mobilize are very large and diverse, but the ability to form financial funds of associations in reality is not so favorable. Because the decisive factor in the ability to mobilize financial funds of associations is directly the benefits from the activities of the association that bring to members and further is the reputation of the association to society. The majority of association members believe that the benefits from participating in the association for members are not commensurate.

commensurate with the amount of money that members contribute. Social activities, international cooperation activities as well as the advisory role for the Government of the associations are very weak, so the image of the association has not been clearly portrayed in the public and society.

According to the results of a survey of business associations nationwide by VCCI in 2003, the proportion of funding sources for business association operating funds only accounted for 39%, the rest was revenue from mobilizing internal resources within the association and a very small part from service activities [3].

Table 2: Financial structure of business association 2003

Waiting for position: %

State budget support

10%
Collecting association dues and services	61%
Foreign funding	13%
Funding from other organizations	16%

Source: VCCI's survey of business associations in 2003

The reason why the financial resources of the Associations are still limited is because the service activities of the Export Processing and Import Export Associations are still simple, usually providing market information, business consulting, publishing publications, training, organizing delegations to survey export markets... and the quality of the services provided is not high. Therefore, there are almost no fees from these services. Some associations do provide customer introduction services for members, but the rate of successful transactions and the volume of goods sold are not high, so the percentage allocated to the association is insignificant and unstable.

Regarding public service activities, through economic contracts with state agencies or other economic organizations, there are still difficulties. Normally, to carry out these services, the leaders and staff of the association must have enough capacity to carry out projects such as participating in the development of legal policies, industry development strategies, etc. However, in our country, on the one hand, due to the capacity of the associations, on the other hand, the state management agencies have not paid attention to and properly assessed the role of associations in public services, so they often undertake these tasks themselves, or coordinate with career organizations such as research institutes and universities to carry them out. Therefore, the income from these activities of the associations is often very small.

The State budget support for the NHNSXK associations is generally limited and each association benefits from the State's support differently. The Food and Pepper Association and the Vietnam Tea Association receive additional revenue from annual export volume, some associations receive support for office space, the majority of associations receive financial support through trade promotion programs. However, this support fund only accounts for 7-10% and helps the association equip some computers, build a website and pay for airfare for members to survey export markets.

In summary, the financial situation of the NHNSXK associations is currently very limited and unstable. For many reasons and causes mentioned above, in general, the association's financial fund focuses on 3 main sources: membership fees, sponsorship from individuals inside and outside the association and support from the State; some associations seek foreign sponsorship, but it is not stable. With the current situation, the NHNSXK associations have been facing great difficulties in organizing the apparatus and directly affecting the expansion and improvement of the association's operational efficiency in performing the role and functions of the industry association.

2.2. Status of implementation of functions of agricultural export industry associations

2.2.1 Representative of interests

It can be said that the association is a common home for its members. Like business associations in general, the main function of the NHNSXK associations is to represent and enhance the interests of its members in relations on a national and international scale. On a domestic scale, the representative role of the NHNSXK associations is demonstrated in two aspects [3]: (i) protecting the interests of the entire member community by maintaining dialogue with the Government on laws and policies directly related to the interests or governing the activities of the member community as actors in the industry chain such as producers, collectors, processors, traders, and exporters; (ii) protecting the legitimate interests of each individual member . On an international scale and scope, the NHNSXK association represents the member community in establishing cooperative relationships with international organizations and industry associations and represents members in resolving international trade disputes.

- Regarding the role of representing and protecting the interests of the entire member community [3], in recent times, associations have contributed an active voice to the process of building a market economy institution and industry development policies, actively demonstrating the role of representing the business community, and actively contributing to the socio-economic development of the country.

The associations have initially demonstrated their representative role, speaking up for businesses before the governing bodies and through the mass media, thereby actively contributing to the formation of legal documents, creating more favorable conditions for businesses such as the Law on Domestic Investment, Law on Value Added Tax, Law on Enterprises, Labor Code, Decree 90 on small and medium enterprises, etc.

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