Food Safety and Quality in Fruits and Vegetables in Vietnam – Consumer Demand and Firms’ Compliance

Abstract: Food systems in developing countries are currently undergoing a profound transformation towards high-value products. Appropriate policies are needed to guide this transformation, presupposing a good understanding of consumer preferences. This project analyzes changing consumption habits for fresh fruits and vegetables in Vietnam, using household survey data and a demand systems approach. Demand for products from modern supply chains – particularly modern retailers and non-traditional imports – is highly income elastic. Also, supermarket expansion impacts on consumer demand. Moreover, we analyze consumers’ valuation of different food safety and quality attributes, using contingent valuation techniques. Vietnamese consumers have a remarkable willingness to pay for vegetables that are free of agrochemical residues and for different convenience attributes. Income levels, urbanization, and media usage have positive impacts on the willingness to pay, suggesting a continued restructuring of the domestic food sector in the further process of economic development. Finally, building on a survey of Vietnamese horticultural processing firms, it is analyzed how the industry reacts to these changes, in order to stay competitive both in domestic and export markets. Adoption of formal quality assurance programs (QAPs) seems to be a critical determinant of international market access. While the implementation of international QAPs – like HACCP, EurepGAP, or ISO 9000 – notably improves access to OECD countries, national QAPs are sufficient for exports to non-OECD countries. For the domestic market the importance of QAPs is gradually increasing too. Some of the results are also applicable to other emerging economies.

Researchers involved: Marcus Mergenthaler, Matin Qaim, Katinka Weinberger (AVRDC) and local partners in Vietnam

Funding: BMZ/GTZ through AVRDC