On August 1, 2024, Vietnam’s new Land Law officially came into effect, marking a significant turning point in the country’s agricultural development strategy. The new law aims to pave the way for modern and green agriculture development by promoting the concentration and efficient use of agricultural land.

One of the core aspects of the new Land Law is allowing the concentration of agricultural land through various methods, including conversion, leasing, production cooperation, and land accumulation transfer. This provision aims to address the long-standing bottleneck issues that have hindered the development of large-scale land funds, creating favorable conditions for high-tech agricultural production.

Agricultural cooperatives and enterprises across Vietnam have already begun to feel the changes brought by the new law. For example, the Tuấn Ngọc Agricultural Cooperative in Ho Chi Minh City has long faced difficulties in land expansion. Lân Tuấn Ngọc, the cooperative’s chairman, stated that they currently have only 4,000 square meters of land for vegetable cultivation, with a daily production of about 1 ton, far from meeting market demand. The implementation of the new law brings hope for expanding their production scale.

Experts generally believe that the implementation of the new Land Law will significantly reduce production costs for high-tech agriculture. Lân Tuấn Ngọc estimates that when agricultural land can be concentrated, production costs for high-tech agricultural cooperatives could be reduced by nearly half. This not only helps improve agricultural production efficiency but will also enhance the competitiveness of Vietnamese agricultural products in international markets.

The new law also provides greater flexibility for local governments. Expert Lê Bá Chi Nhân points out that the new Land Law allows local governments to plan land use and reorganize production based on local conditions and advantages. This will create favorable conditions for promoting the “One Community One Product” (OCOP) program and strengthening regional connections.

In the Mekong Delta region, the implementation of the new law is seen as an important opportunity for developing sustainable agriculture. Ngô Minh Long, Director of the Department of Agriculture and Rural Development in Hậu Giang Province, stated that the new law creates favorable conditions for enterprises to participate in projects developing 1 million hectares of high-quality, low-emission rice, aligning with the region’s green growth development goals for 2030.

However, the implementation of the new law also faces some challenges. Nguyễn Văn Phụng, former Deputy Director of the Tax Policy Department at the Ministry of Finance, points out that many farmlands are still idle because farmers lack the ability to cultivate effectively and are also lacking confidence in leasing land to enterprises. He emphasizes that local authorities will play a key role in addressing this issue and promoting effective land use.

The business community has generally responded positively to the new law. Nguyễn Thành Phước, Director of Phước Thành IV Trade – Production Company, stated that the accumulation of agricultural land allows enterprises to expand production scale, apply modern technologies to improve productivity and efficiency while reducing costs. More importantly, with the expansion of available land area, enterprises will have more confidence in investing in new models such as high-tech agriculture, organic agriculture, and low-emission agriculture.

The implementation of the new Land Law is also closely linked to Vietnam’s environmental protection and sustainable development goals. By encouraging high-tech and low-emission agriculture, the new law is expected to push Vietnam’s agriculture towards a greener, more sustainable direction. This will not only help improve the quality of agricultural products but will also help Vietnam fulfill its international environmental commitments.

Provinces and cities are also actively responding to the implementation of the new law. For example, Hậu Giang Province, as a purely agricultural province, is actively calling for agricultural investment, hoping to attract more investors to participate in local agricultural development by leveraging the new law.

In summary:

• Vietnam’s new Land Law, effective August 1, 2024, aims to promote modern and green agricultural development by allowing the concentration of agricultural land, marking a new stage in Vietnam’s agricultural development.
• Through local government promotion of agricultural land concentration and efficient use in land planning and production reorganization, Vietnam expects to ensure food security and improve agricultural production efficiency.
• The new law is expected to solve bottleneck issues in large-scale land fund development, reduce production costs for high-tech agriculture, and improve production efficiency and international competitiveness. Implementation still requires joint efforts from the government, enterprises, and farmers, as well as overcoming practical challenges such as land idleness and lack of farmer confidence.

As time progresses, the impact of the new Land Law on Vietnam’s agricultural landscape will gradually become apparent. The industry generally expects that this law will inject new vitality into the modernization and sustainable development of Vietnam’s agriculture while providing more opportunities for international investors to participate in Vietnam’s agricultural development.

For more updates on Vietnam’s agricultural policies, please follow our Vietnam Information column. We provide various in-depth analysis reports to help you grasp the latest pulse of the Vietnamese market. Feel free to contact our Jaycy for more information. Let’s together pay attention to Vietnam’s development and explore the unlimited possibilities of emerging markets in Southeast Asia!