Private Sector Resilience
According to the World Bank, Vietnam loses 1-1.5 percent of GDP annually (approximately US $257 million) because of disasters such as floods, typhoons, landslides and drought. The agricultural sector, which contributes about 21 percent of GDP, is particularly affected by disasters and changes in the climate. An increase in the temperature, sea level rise, saltwater intrusion in freshwater and water scarcity can all lead to loss of arable land, lower yields and higher costs for both farmers and traders.
The Red River Delta, Mekong River Delta and the Central Highlands are the main agricultural areas in Vietnam in terms of land use, production output and the number of people employed. However, research on the private sector’s resilience to disaster and climate risks in Vietnam shows that agricultural production in these areas is highly affected by extreme weather events. For example, extensive drought and delayed rainfall in 2011 in the Central Highlands resulted in a 20 percent production loss in the coffee sector compared to the previous year.
Companies in the agricultural sector, especially small and medium enterprises (SMEs), are coping with these situations in an ad-hoc manner. Few agribusinesses have integrated disaster risk reduction (DRR) and climate change adaptation (CCA) measures into their business strategies. Many companies are not aware of future environmental risks and lack information to make well-informed decisions on how best to respond to environmental challenges so that they can minimise losses.
A broad partnership
In order to effectively build resilience to disasters and climate change risks in the agricultural sector, Oxfam believes it is important to work with a range of partners and develop long-term cooperation among many stakeholders.
As such, Oxfam is currently developing a project that builds resilience among agribusinesses through a partnership model among small-scale farmers, SMEs, large corporations, banks and financial institutions, government agencies and other stakeholders. The objective is that by 2020, 10 percent of agribusinesses in Vietnam are aware of disaster risks and the impact of climate change on their business and the surrounding community, and are willing to get involved in DRR and CCA initiatives.
Providing information and building networks
To reach this objective Oxfam is working in three areas. First of all, Oxfam will provide agribusinesses with information on disaster risks and possible CCA actions, allowing them to make informed decisions on the risks and opportunities they face. The focus will be on value chains that include many small-scale producers and that face high disaster risks, such as pork, fruit and coffee.
Second, Oxfam will draw on existing partnerships, as well as develop new networks on disaster risk reduction and climate change adaptation, in order to share relevant information and good practices with agribusinesses. Throughout the project, Oxfam will build on its extensive experience and knowledge of DRR and CCA in the Mekong and Red River deltas, as well as our collaboration with government agencies, business networks and research institutes. This includes working with the Ministry of Agriculture and Rural Development, the Ministry of Natural Resources and Environment, and the Vietnam Chamber of Commerce and Industry to advocate for additional mitigation and adaptation measures.
In partnership with other organisations and networks, Oxfam is strengthening the capacity of agribusinesses in disaster risk reduction and climate change adaptation, thereby helping to secure supply chains and reduce economic losses in the medium and longer term. Oxfam also encourages business investment in DRR and CCA measures and promotes standards and codes of conduct on the issue.
Project: Private Sector Resilience (in development)
Time frame: 2016-2018
Funding: Oxfam core funding, Ministry of Foreign Affairs of the Netherlands