Tremendous economic growth has made Vietnam one of the strongest economies in the Association of Southeast Asian Nations ASEAN over the past decade. However, not everyone is part of this success story: Living in remote areas, Vietnamese ethnic minority farmers have rarely been included into the successful agricultural supply chains. With this project, Helvetas aims to support the farmers to increase their income by selling their sustainably produced products to local certified Small and Medium Enterprises.
Project NamePromoting sustainability standards in supply chains to improve the living conditions of ethnic minorities in Vietnam
Project Phase2021 to 2022
FundingThe project is co-funded by German Federal Ministry of Economic Cooperation and Development (BMZ)
Thematic focusPrivate Sector Development
Ethnic groups make up 14.6% of Vietnam's 96 million population, while they account for 52.7% of the population living in poverty. The crop commodities grown by the ethnic farmers, particularly cinnamon and medicinal plants, have a high potential to be exported to European markets, especially through the EU-Vietnam Free Trade Agreement (EVFTA) signed in 2019. However, in order to meet EU sustainability standards and thus get access to this growing market, many aspects of production, processing and trade must be improved which presents a major challenge for Small and Medium Enterprises (SMEs). SMEs play a crucial role in Vietnam as they source their products directly from millions of farmers and are thus important actors in poverty reduction. The lack of understanding and complying to the sustainability standards has limited the competitiveness of these SMEs to participate in the global supply chains.
With this project, Helvetas and its local partner organization CRED (Center for Rural Economy Development) aim to improve employment and income of ethnic minority farmers in the two northern provinces Lao Cai and Bac Kan by promoting sustainability standards and competitiveness of the farmers and SMEs.
Through context-specific trainings on sustainability standards applicable to the production of medicinal plants and cinnamon, farmers learn how to comply with the standard requirements and sell their products for a higher price. As women are the main actors working with these crops, the project focuses on strengthening their skills through various trainings and improve their economic position by achieving a higher income through their agricultural production.
With the support of the project, the trained farmers get the opportunity to become part of a producer group, led by an elected lead farmer. The lead farmers receive additional training to effectively represent their members and to manage the future training, technical support and to negotiate with companies.
Participating SMEs are supported to apply for certification of organic and ethical labels. Like this, the yields of sustainable produced medical plants and cinnamon can be marketed and ethnic farmers can earn a better income.
The project is co-funded by the German Ministry of Economic Cooperation and Development (BMZ).