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Export-Oriented Agri-Food Business Resilience:
A Comparative Analysis of the Philippines and Vietnam
A Student Multidisciplinary Applied Research Team (SMART) Project
1
Jong Min Jung, Xuqian Ma 2
Team Leader: Lin Fu 3
Faculty Advisor: Ralph Christy 4
Soyuz Food International Inc. (SFII) Findings
Based in Philippines, SFII was founded by Helen del Rosario with Philippines Vietnam
the purpose of producing and marketing 100% Philippine fruit Factor Condition • Labor: 30% of population in • Labor: 42% of population in
purees with no additives or preservatives at the highest agriculture sector agriculture sector
international standards. • Farmer average daily wage: 6.82 • Farmer average daily wage: 22.6
USD USD
• R&D: 298.4 million (0.41% of • R&D: 177.6 million (0.20% of Ag-
Business Challenges Ag-GDP) in 2017 GDP) in 2017
Demand • GDP per capita: 3485.09 USD in • GDP per capita: 2715.28 USD in
COVID-related Condition 2019 2019
Like other export-oriented agribusinesses in the Philippines, SFII
• Total export value of fruit • Total export value of fruit
faced several COVID-related challenges:
industry: 1.93 million (0.002% industry: 38 million (0.014% of
• Financial: decline in export volumes, fixed business costs, etc.; of total export) in 2019 total export) in 2019
• Shipping: shortage of containers, increased cost of container Firm Strategy, • Higher DTF (Distance To Frontier) points in Vietnam
shipping; Structure, and • Higher Ease of Doing Business points in Vietnam
• Supply of raw materials: shortage of workers to transport raw Rivalry • Intensity of local competition is low in Vietnam
• Global market share of Citrus fruit is significantly higher in Vietnam
materials.
Related and • Agri-business supporting • Agribusiness supporting
Supporting institutions (e.g Agrarian institutions (e.g. The Agricultural
SFII has been weathering the pandemic through a mix of strategies: Industries Production Credit Program, High-tech Park, Root Crop
funds from personal savings, funds from a government pandemic Philippine Crop Insurance processing cluster, Agribusiness
relief schemes for SMES, and expansion into e-commerce. Corporation, etc.) Booster)
• WTO , ASEAN Regional • WTO, ASEAN, Ministry of Industry
Long-term competition from Vietnam Comprehensive Economic and Trade (MOIT)
Competition from Vietnamese fruit processors was a problem for Partnership (RCEP) facilitates Regional
SFII (and the entire Filipino fruit processing industry) even before Comprehensive Economic
Partnership (RCEP), EU-Vietnam
the pandemic. The pandemic has brought into sharper relief the
Free Trade Agreement (EVFTA)
threat to Filipino fruit processors of competition from Vietnam. The
• Infrastructure : Higher domestic transporting system points in
industry-wide nature of this concern calls for a comparative study Vietnam (Significant impact on agri-food supply chain)
of national competitiveness and the role of government in SME General SME • Government actions are • VIETRADE
agri-business resilience in the Philippines and Vietnam. Policies usually blocked by regional • Vietnamese Master Plan
level (Comprehensive action)
Methods • Lack of passion, Lack of
initiatives
• In-depth interviews via Zoom with Helen del Rosario (SFII), SME Policies • Emergency subsidy program • Reduction of interest rates on
during the COVID- (ESP ) loans
Philippine Department of Trade and Industry (DTI) Export
19 Pandemic • Social security system to • Reduction of rent for land plots
Management Bureau (EMB), and the DTI EMB food and finance USD 24 million worth of • Interest rate support for famers
beverage industry cluster unemployment benefits • Reduction in annual agricultural
• Literature review • Subsidy to micro enterprises land use tax is subject to extra
• Interest free loan assistance agricultural land area
• Statistical databases (incl. World Bank, STATISTA)
Competitive Advantages of Nations Implications
➔Vietnam has larger and younger population engaged in agriculture while more land is
dedicated to agriculture production in the Philippines.
➔The Philippine government has invested more in agriculture R&D.
➔Both household final consumption expenditure on food and beverage and total export
value of fruit in Vietnam are higher.
➔In Vietnam, SME policies targeted more at agri-food SMEs.
➔Vietnam has more sizable domestic and global market.
➔Vietnam has more favorable business and international trade environment.
Acknowledgements Affiliations
We would like to thank Helen del Rosario (SFII), 1, 2, 3, 4 Charles H. Dyson School of
Philippine DTI EMB, DTI EMB F&B Industry Applied Economics and Management
Cluster, Dr. Ralph Christy, and Dr. Ndunge Kiiti.
