Traditional and Conventional Agriculture, an Economic Perspective

Before the dominance of conventional agriculture, food was grown using natural fertilizers and could be considered primarily organic; this method came to be known as traditional agriculture. Conventional agriculture, which involves techniques using certain non-organic fertilizers, pesticides, insecticides and herbicides, gained a strong foothold due to the claim of higher crop yields at lower costs than traditional techniques. In recent years, organic food has experienced a sort of revival in developed countries and continues to have strong growth, but the idea has yet to gain much traction in Vietnam and the domestic market for organic food remains very limited. Traditional agricultural production in Vietnam was reintroduced in the 1990s with the production of organic tea and spices, and just as it is mostly supported by foreign non-governmental organizations (NGOs) and export companies today, much of that organic produce is exported from the country.

Agricultural production occupies over 13 million hectares of land and contributes to 20-25% of Vietnam’s GDP. In 2007, it was reported that only 22,000 hectares (or 0.17%) of agricultural land was dedicated to traditional agriculture. While Vietnam does promote safe and semi-organic food for the domestic markets, there is a lack of promotion of organic food within those campaigns. NGOs and export companies, who cannot rely on government regulations to enforce the quality of the produce, must set up their own certification standards and services.

Some of the main benefits of traditional agriculture are that the process is less damaging on the environment, the techniques help to minimize the intake of pesticide residues, and the yield may potentially be the same as yields seen in low-intensity agriculture that are being used in developing countries. For Vietnam, where agriculture continues to contribute significantly to the country’s GDP, traditional agriculture has the potential to grow within the industry in general and domestic markets in particular. Since the supply of organic food is rather limited because production occurs on a smaller scale, prices are higher for organic food than produce derived from conventional agriculture, which compensates farmers for higher input costs.

However, the traditional agriculture subsector in Vietnam faces several major constraints. While the government continues to develop standards and methods of certification for this emerging subsector, there is limited emphasis on promoting traditional agriculture, leaving farmers with little knowledge about the trade-offs of traditional and conventional agriculture. On the demand side, as traditional agriculture continues to be produced on a smaller scale relative to conventional agriculture, higher prices may leave organic food accessible only to the affluent while a majority of the domestic population cannot afford organic food. Since both traditional and conventional agriculture exhibits economic values and challenges, prudence should be taken as Vietnam decides on maintaining the status quo or moving towards more traditional agriculture.