What are the effects of supermarketization on consumers in urban areas in Vietnam: who benefits, who is excluded, and what are the consequences? The publication by Sigrid Wertheim-Heck, Sietze Vellema and Gert Spaargaren covers these queries. The paper is a contribution to the development of more inclusive retail modernization policies.
Access to safe and healthy food is a crucial element of food security. In Vietnam the safety of daily vegetables is of great concern to both consumers and policymakers. To mitigate food safety risks, the Vietnamese government enforces rules and regulations and relies strongly on a single approach for organizing food provision; being modernizing retail by replacing wet markets with supermarkets. In general, reorganizing food provision in this way is increasingly considered to be a guarantee for food safety, especially in urban settings with growing populations. To assess the effectiveness of this induced retail modernization of the fresh vegetables market in Vietnam’s capital Hanoi, the paper examines for whom and under which conditions does this approach deliver the desired outcomes.
The survey data and interviews show that ongoing retail modernization in Hanoi reaches only a minor segment of the population and drives a large group of shoppers into informal vending structures.
On the basis of five case studies, this paper demonstrates how similar supermarket interventions can yield contrasting outcomes when they do not accommodate for differences in shopper population and do not adapt to variations in the urban conditions.
To reduce exposure to unsafe food, particularly for poorer segments of the population, the research concluded that developing a flexible portfolio of retail modernization pathways and adopting a reflexive policy approach provide better impact and leverage, as opposed to the current trend of promoting supermarkets as a single, ideal-type form of food shopping.
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The Food, Agri and Aqua Business Sector Committee (FAASC) of the European Chamber of Commerce in Vietnam (EuroCham) organised a dialogue (27th of May 2015) between Government representatives and companies regarding the importance of traceability and legal enforcement for the control of food safety.
Food safety is still an issue in Vietnam and this limits Vietnam in exporting food, agriculture and aquaculture products. Too frequent products are blocked at the border of the importing country due to existence of high levels of certain heavy metals, bacteria, virus, moulds or other prohibited substances in products. This costs money and damages the reputation of Vietnamese products.
Currently various free trade agreements, such as the EU-VN Free Trade Agreement and the Trans-Pacific Partnership (TPP) are being negotiated. For 2015 the export goal for agricultural products is set at 32 billion USD. To reach this goal, it is important that food safety issues will be addressed.
The legal framework exists and the Government takes measures to improve food safety, however it is not enough. There are various ways to achieve the goal of safe food. Traceability and legal enforcement are two of such ways that can support the improvement of food safety.
Traceability is important in case of a food safety issue. Companies need to track down the origin of their ingredients, so in the worst-case scenario a product can be recalled. Also, consumers are concerned about food safety and would like to know the source of their purchased products.
Legal enforcement is equally important. Existing regulations should be enforced in an efficient and effective way. Currently, violating the rules is in some cases profitable. Fines are (too) low and the risk of being caught is not very high. Various food issues can be avoided by simply enforcing existing regulations.
Actions to improve
Companies should improve the food safety situation by introducing and using a traceability system.
The Government should check these traceability systems and should enforce existing regulations. Both foreign as local companies should be treated in the same way as the applicable law requires.
The dialogue has brought together representatives of various departments and agencies of the Vietnamese Government representatives of several embassies, international organisations and relevant industry and professional Vietnamese associations. Several keynote speakers were invited to present about product traceability legal enforcement:
Jean Jacques Bouflet, Minister Counsellor and Head of the Economics and Trade section of the EU delegation in Vietnam, highlighted the importance of traceability as the cornerstone of reliable and sustainable trade exchanges between counties and referred to a cooperation program between the EU and Vietnam to share the European traceability experience through TRACES (= TRAde Control and Expert System). This is a trans-European network for veterinary health which notifies, certifies and monitors imports, exports and trade of animals and animal products.
Nguyen Hung Long, deputy director of the Vietnam Food Administration, presented the current status of traceability in Vietnam.
Peter Robson, CEO of DSM Vietnam, and Siebe van Wijk, managing director of Fresh Studio, presented the implementation of their companies in relation to traceability.
Fresh Studio’s managing director, Siebe van Wijk stated:
“Traceability systems are an important tool in controlling food safety, because farmers will realize that a company can, in case food safety violations occur, always trace from which farm a product is originating. But this is just one of the elements which are needed to make Vietnam more successful in exports of agricultural products. This is a task which the private sector can control and implement itself, but one of the larger bottlenecks for successful exports is completely in the hands of the Vietnamese government: market access of Vietnamese products to neighbouring countries. Van Wijk gave the example of the trade balance for fruit between Thailand and Vietnam. While the Thai exports of fruits to Vietnam has a value of US$ 178 mln per year, Vietnam is only exporting about US$ 10 mln. This negative trade balance is caused by the fact that Vietnam is only allowed by Thailand to export dragon fruit, and for vegetables, only sweet potato. This is a very unbalanced situation, as Thai mandarins, rambutans, mangosteens and many other fruits flood the Vietnamese market. Vietnam could export a lot more fruits to Thailand, or other ASEAN countries, but unfortunately little market access has been arranged.”
After the presentations a lively and interesting discussion took place between representatives of the industry, government officials of the relevant ministries as well as representatives of international organisations.