Summary of economic doctoral thesis economic linkages between enterprises and farm households in the production of long term industrial crops in dak lak province

VIETNAM ACADEMY OF SOCIAL SCIENCES GRADUATE ACADEMY OF SOCIAL SCIENCES NGUYEN THANH PHUONG ECONOMIC LINKAGES BETWEEN ENTERPRISES AND FARM HOUSEHOLDS IN THE PRODUCTION OF LONG-TERM INDUSTRIAL CROPS IN DAK LAK PROVINCE Mayor: Major code: Economic management 934 04 10 SUMMARY OF ECONOMIC DOCTORAL THESIS HA NOI - 2020 Thesis is completed at: GRADUATE ACADEMY OF SOCIAL SCIENCES SCIENTIFIC ADVISOR: Assoc Prof Dr Vu Hung Cuong Dr Tuyet Hoa Nie Kdam Reviewer 1: …………………………………………………… Reviewer 2: …………………………………………………… Reviewer 3: …………………………………………………… The thesis is to be defended to the thesis Committee of Graduate Academy of Social Sciences, 477 Nguyen Trai Street , Thanh Xuân District, Ha Noi City At ….o’ clock, December …., 2020 The thesis can be found at: Information and documentation center – Graduate Academy of Social Sciences The National Library of Vietnam HEADING The necessity of the thesis Economic linkages in general, economic linkages between enterprises and farmer households in particular can create many positive impacts on agricultural production Dak Lak is a province located in the center of the Central Highlands, with many advantages to develop many types of long-term industrial crops with high economic value such as coffee, pepper, rubber, cashew , the production value of perennial industrial crops accounts for more than 60% of the province's total crop production value Production of perennial industrial crops is the main livelihood of many parts of the population living in rural areas in the province, a source of exports that bring foreign currency, as well as creating a contribution to over 60% of the total annual budget revenue of the province With the attention and investment of resources from the state and the people, economic linkages between enterprises and farmer households in the value chain of perennial industrial crops in Dak Lak in recent years have had many significant development points Economic linkages to the production and consumption of high quality agricultural products continue to be formed in most of the province's perennial industrial crop production areas; Many economic linkage models have contributed to increase income and benefits for participants (accounting for 82.10%); Economic linkages have contributed significantly to improving the quality of agricultural products (accounting for 19.05%), or improving the efficiency of value chains of perennial industrial crops (accounting for 94.37%) In addition to the positive points achieved, the economic linkage between enterprises and farmer households in today's long-term industrial crop value chains still has many shortcomings Most of the area of economic linkage between enterprises and farmers in the production of perennial industrial crops is simple linkage (accounting for 80.65%) The level of support or compensation for the lack of resources and skills for each other between the stakeholders in the association is still limited Many linking subjects still not attach importance to the use of text contracts to present linked content, the percentage of linking cases using text contracts is only 10.61% Or the role of economic linkage in changing the way of production organization and application of science and technology of farmers has not met the expectations of the society In addition, although previous researchers have built many aspects related to the theoretical basis of the economic linkages between enterprises and farmer households in the production of perennial industrial crops, create a solid theoretical foundation for the following researchers to inherit and apply However, the theoretical basis for the economic linkage between enterprises and farmers in the production of perennial industrial crops still has gaps that can continue to develop Facing the above situation, the study "Economic linkages between enterprises and farmer households in the production of perennial industrial crops in Dak Lak province" is considered a necessary activity, which can bring many benefits to promote economic linkages between enterprises and farmers in the production of perennial industrial crops in the coming time, thereby contributing to improving the performance of perennial industrial crop value chains and improving the lives of many communities living in rural areas in Dak Lak province Purpose and mission of the research General research purposes: On the basis of the theoretical framework, the author analyzes and assesses the current economic linkages between enterprises and farmer households in the production of perennial industrial crops in Dak Lak province in the period 2014-2018, point out the successes, shortcomings, and identify the influencing factors, from which proposing solutions to promote the linkage between enterprises and farmers in the production of perennial industrial crops in Dak Lak province to 2030 Specific research tasks: + Contribute to systematize the theoretical and practical system of economic linkages between enterprises and farmer households in the production of perennial industrial crops + Analyzing and assessing the current status of economic linkages between enterprises and farmers in the production of perennial industrial crops in Dak Lak province in the period 2014-2018, pointing out successes, shortcomings, and causes + Identifying and analyzing factors affecting economic linkages between enterprises and farmer households in the production of perennial industrial crops in Dak Lak province + Proposing solutions to promote economic linkages between enterprises and farmer households in the production of perennial industrial crops in Dak Lak province in the coming time Objects and research methods - Research object: Economic linkages between enterprises and farmers in the production of perennial industrial crops - Research scope: + Content scope:  The phrase "production of perennial industrial crops" in research is understood in a broad sense of the chain, including from production to consumption of agricultural products  The thesis will study the economic linkages between exporters, processing enterprises, trade intermediaries, and input suppliers with farmers, who produces perennial industrial crops in Dak Lak However, for enterprises that supply input factors, the author only limited research to enterprises supplying fertilizers, plant protection drugs and varieties For other enterprises that supply weak inputs such as machinery, equipment, packaging the author will not research, because the potential for developing linkages between these enterprises and farmer households is low  Dak Lak's perennial industrial crops today include as follows: Coffee, rubber, pepper, cashew, tea, macadamia However, research is limited to the main perennial industrial crops are coffee, rubber, pepper, and cashew The author does not study on tea and macadamia trees because: 1) Tea area is only about 90 ha, accounting for less than 1/1,000 of the total areas of industrial crops in the province and has little potential for expansion; 2) The activity of planting macadamia trees is still in the trial stage, the potential for development of this tree has not been determined in Dak Lak province + Time scope: Assess the current situation in the period 2014-2018, propose orientations and solutions to 2030 + Space scope: Dak Lak province Methodological basis and research methods 4.1 Research approach There are many research approaches to economic linkages between firms and farmers In the thesis, the author conducts research according to the value chain approach The basis for the research on the value chain approach of the thesis is as follow: + Material suppliers, agricultural households, primary processing and processing enterprises, commercial enterprises or agricultural exporters are all stakeholders in the value chain + Economic linkages between enterprises and farmer households are a form of economic relations between groups of stakeholders in the value chain of agricultural products (economic relations between input suppliers and farmers; business relationships between farmer households and enterprises that consume agricultural products) + Developing economic linkages between enterprises and farmers will contribute to the development of the value chain of agricultural products During the research process, the author approaches the economic management "perspective" of state management agencies 4.2 Research methods 4.2.1 Methods of collecting documents and data a Content analysis method of available data, documents Used to collect available documents for thesis construction Expected information can be obtained from available documents, including: Information for building the overview content of related researches Information for systematizing theoretical basis The information reflects the content of State's role in economic linkages between enterprises and farmer households in the production of perennial industrial crops in Dak Lak province Information on practical experiences of countries and some localities on the economic linkages between enterprises and farmers in agricultural production Data on the size, yield and yield of perennial industrial crops in Dak Lak province b The method of using questionnaires to collect primary information Used to collect primary information for thesis construction The content of primary data to collect includes: Data reflecting the current economic linkages between enterprises and farmer households in the production of perennial industrial crops in Dak Lak The data partially reflect the role of the State on economic linkages between enterprises and farmers in the production of perennial industrial crops in Dak Lak province The data reflect factors affecting the economic linkages between enterprises and farmers in the production of perennial industrial crops in Dak Lak Survey subjects to collect primary data include: enterprises, farmers and intermediaries (cooperatives) The number of samples collected was 275 units Classification and sampling method: + The number of samples surveyed for each tree type was determined by the ratio of the area of each type of perennial industrial tree to the total area of perennial industrial crops in the province + The number of samples for each type of association participants is determined as follows: Because the firms and intermediaries participating in the association are low in number, all firms and these intermediaries should be surveyed The rest of the sample to be surveyed will be distributed to farmers + The localities selected for the survey were the main perennial industrial crops production areas of the province + Survey samples were randomly selected in areas that produce coffee, pepper, cashew rubber c In-depth interview method The primary data expected to be collected by in-depth interviews are part of the data reflecting the current situation of economic linkages between enterprises and farmer households in the production of perennial industrial crops in Dak Lak province - The method of data collection: Interviewing with state management officials, enterprises, farmers, intermediaries related to the economic linkages between enterprises and ffarmer households in the production of perennial industrial crops in Dak Lak directly 4.2.2 Analytical method - Methods of synthesis and analysis of data: + Methods of synthesis and analysis used to: 1) synthesize research related to the topic published in chapter 1; 2) synthesize some basic theoretical and theoretical bases, practical experiences in chapter 2; 3) synthesizing and analyzing the current situation in chapter 3; 4) Synthesize scientific and practical bases from chapters and to propose solutions in chapter + Methods of data synthesis: Based on data collected from available documents, questionnaires and in-depth interviews, this method is used to synthesize the necessary indicators for the construction report The software used is Microsoft Office + Methods of data analysis: Including descriptive statistics and comparative statistics  Descriptive statistical method: Basic on the indicators, information synthesized from the secondary data and the primary data, this method is used to: 1) Describe a part of the content of assessing the status of the economic linkages between enterprises and households in the production of perennial industrial crops in Dak Lak province in Chapter 3; 2) Describe a part of the contents of the factors affecting the economic linkages between enterprises and farmer households in the production of perennial industrial crops in Dak Lak province in chapter  Comparative statistical method: Basic on indicators and aggregated information from the secondary and primary data, the comparative statistical method is used to reflect the difference in the status of economic linkage between Enterprise and farm households among perennial industrial crops, between different forms and models of economic linkages in Chapter Expected research results to be achieved The expected research results to be achieved include: - Based on the systematization of the theoretical and practical basis of the economic linkages between enterprises and farmers in the production of perennial industrial crops, the author builds an analytical framework of the thesis - By analyzing and assessing the current economic linkages between enterprises and farmer households in the production of perennial industrial crops in Dak Lak province in the period of 2014-2018, the author points out the successes, shortcomings and causes Multiply, creating the basis for the scientific and practical basis for proposing solutions, mechanisms, and policies - Analyze the factors affecting the economic linkages between enterprises and farmers in the production of perennial industrial crops in Dak Lak to create a basis for more concretization of proposed solutions, mechanisms and policies which have scientific and practical basis - Perspectives, orientations and proposed solutions to promote the development of economic linkages between enterprises and farmer households in the production of perennial industrial crops in Dak Lak province by 2030 have scientific bases and real values The research results of the thesis are valid for reference in research, planning and policy implementation for state management agencies, local governments, research and training organizations related to the research topic Thesis structure In addition to the introduction, conclusion, list of references, appendices, the structure of the thesis includes the following main parts: Chapter Overview of researches related to the thesis topic Chapter Theoretical and practical basis for the economic linkage between enterprises and farmers in the production of perennial industrial crops Chapter Current situations of economic linkages between enterprises and farmer households in the production of perennial industrial crops in Dak Lak province Chapter Viewpoints, orientations and solutions to promote economic linkages between enterprises and farmers in the production of perennial industrial crops in Dak Lak province CHAPTER OVERVIEW OF RESEARCHES RELATED TO THE THESIS TOPIC Economic linkages between enterprises and farmer households have a long history of development, so there are many views, research results related to this issue have been proposed and implemented In terms of theory and practice, related studies have mentioned many aspects of the technical cooperation between enterprises and farmers From the issue of State management of linking activities, commitments in linking, the role of linking activities, factors affecting linking activities, to solutions to improve linking activities Besides, we can see that theories and research results related to economic linkages between enterprises and farmer households are highly appreciated, widely acknowledged and used in many studies: 1) There are models of economic linkages between enterprises and farmers: nuclear farm model, centralized model, intermediate model, informal model; 2) The association will have commitments: contract term, buyer's quality standards, farmers 'production quota, and request for the farmers' farming practices, delivery organization, how to determine prices, credit reform, insurance; 3) Linkage activities will create many positive impacts for farmers and enterprises participating in the association; 4) Factors affect linkages: farm household characteristics, business characteristics, agricultural characteristics, choice of association, state factors The dissertation points inherited from related researches: Inheriting the classification of economic linkages between enterprises and farmer households, the content of organizing the association, how to evaluate the efficiency of economic linkages, the content factors affecting economic linkages of published researches to build and synthesize the contents of the thesis such as: Scale, form and model of economic linkages between enterprises and farmers in the production of perennial industrial crops; To organize the implementation of economic linkages between enterprises and farmer households in the production of perennial industrial crops; Efficiency and indicators reflect the efficiency of economic linkages between enterprises and farmers in the production of perennial industrial crops; Factors affecting economic linkages between enterprises and farmer households in the production of perennial Economic linkages in the production of perennial industrial crops include vertical linkages (linkages between subjects in different production stages), horizontal linkages (linkages between subjects in the same production stage), and mixed bonding Among the three types of economic linkages above, the economic linkage between enterprises and farmers in the production of perennial industrial crops is the first, vertical link Economic linkages between enterprises and farmer households in the production of perennial industrial crops are inconsistent with the term "written agricultural contracts" Economic linkages between firms and farmers in the production of perennial industrial crops can be done in the form of written contracts or not been Economic linkages between enterprises and farmers emphasize the coordination, ways to compensate for the shortage of resources and the mutual support between enterprises and farmer households for mutual development Financial resources, ability farmers' access to the market and production techniques are still in short supply, thanks to linkage with enterprises, farmers can have capital solutions to serve their production, business, and consumption Enterprises can support farmers in market access and training, technology transfer, and improved production processes for farmers Enterprises need raw materials are high quality agricultural products to ensure production and supply of processed agricultural products in accordance with the market standards of consumption and export, thanks to linkage with farmers, they can get the desired raw materials 2.2 Content of research on economic linkages between enterprises and farm households in the production of perennial industrial crops a Scale, form and model of economic linkage between enterprises and farm households in the production of perennial industrial crops Scale of economic linkages between enterprises and farmer households in the production of perennial industrial crops 11 Form of economic linkage between enterprises and farmers in the production of perennial industrial crops Economic linkage model between enterprises and farm households in the production of perennial industrial crops b The role and position of stakeholders in the economic linkage between enterprises and farmer households in the production of perennial industrial crops Subjects and their role when participating in economic linkages between enterprises and farmers in the production of perennial industrial crops The position of subjects in the economic linkages between enterprises and farm households in the production of perennial industrial crops c Motivation of subjects when participating in economic linkage between enterprises and farmers in the production of perennial industrial crops Motivation of enterprises Motivation of farmer households d Implement economic linkages between enterprises and farmers in the production of perennial industrial crops Selecting the region to linkage Propaganda and persuasion Selecting linkage partner Building committed content Implementing committed content Handling of risks (handling new arising) In addition, in the process of implementing the linkage, it is necessary to define the benefit sharing mechanism of the enterprise farmer and consider the sustainability of the linkage e Efficiency and indicators reflect the efficiency of economic linkages between enterprises and farmers in the production of perennial industrial crops 2.3 Factors affecting economic linkages between enterprises and farmer households in perennial industrial crop production a Objective factors 12 Mechanisms and policies of the State (at central level) Management role of local government Market and market development level The role of intermediaries (banks, industry associations, cooperatives and cooperative groups, purchasing agents) Some other objective factors: + Scientific - technological development + Infrastructure system + Customs + Scale and level of agricultural production and local agricultural advantages b Subjective factors The need of linkages, awareness and capacity for implementation: + The linkage’s need of enterprise + The enterprise's knowledge and ability to perform the linkages The need for association, awareness and capacity to implement the linkages of households: + The need for linkages of farmers + Awareness and capacity’s farm households to implement the linkages Other subjective factors: + Quality contract terms + Adhering to commitments 2.4 Experienced lessons from international and domestic experiences on economic linkages between enterprises and farmer households in the production of perennial industrial crops Direct linkage with processing factories will help farmers not have to share benefits with intermediaries (traders), thereby contributing to improving income In addition, thanks to the direct linkages with the processing factory, farmers will reduce their dependence on the trader’s system during the consumption of agricultural products (Quang Tri) Economic linkages between enterprises and farm households differ among types of agricultural production Same conditions, but economic linkages will not be the same between different crops and animals (United States) 13 The application of sustainable production processes, thereby increasing productivity, quality and selling prices of agricultural products is an important factor in the success of economic linkages between enterprises and farmers (Binh Phuoc) The establishment of farmer organizations and industry associations will help strengthen the position and bargaining power of farmers in the process of economic linkages with enterprises, which is an important factor to ensure the benefits of farmers (Thailand) The development of transport infrastructure, the formation and growth of retail groups, and the expansion of the size of farms and processing plants will create a driving force for economic linkages between enterprises and farming households, especially contractual association (United States) The volatility of agricultural prices is a major challenge in the process of creating and implementing economic linkages between enterprises and farmers (Son La, USA) Appropriate support policies of state agencies are an important factor contributing to the development of the linkages Building a truly powerful regulator, building the suitable linked strategy, building an equitable benefit distribution mechanism, regulating the production area or participating in monitoring the linkage process will contribute to improving the efficiency and sustainability of the linkages On the contrary, the unreasonable effects of government agencies will inhibit the development of this activity (Thailand) Full understanding of information regarding the linking process; Keeping trust and strictly following commitments are important factors to ensure the success of the association (Son La, Binh Phuoc) 14 2.5 Analytical framework of the thesis 15 CHAPTER CURRENT SITUATION OF ECONOMIC LINKAGES BETWEEN ENTERPRISES AND FARMER HOUSEHOLDS IN THE PRODUCTION OF PERENNIAL INDUSTRIAL CROPS IN DAK LAK PROVINCE 3.1 Natural, socio-economic conditions and current status of production of perennial industrial crops in Dak Lak province a Naturals condition Dak Lak province is located in the Central Highlands region with many advantages in terms of land, climate, and water resources to develop perennial industrial crops with high economic value such as rubber, coffee, pepper, cashew The biggest challenge posed by the natural conditions to the production of perennial industrial crops in Dak Lak province is that the dry season here is often long and this can lead to a shortage of water for supply to plants in the dry season, negatively affecting the growth and development of plants b Social and economic conditions Compared with some other provinces in the Central Highlands region, the infrastructure system of Dak Lak is also relatively developed, but also weak compared to many other provinces and cities in the country The transportation system in Dak Lak province includes roads, waterways, and airways The electricity system is increasingly strengthened in both quantity and quality, ensuring stable power supply for production and daily life Dak Lak's post and telecommunications system has developed strongly and widely throughout the province The province has also formed many commercial centers for buying, selling and exchanging agricultural and forestry products from the province to districts, communes, and wards Dak Lak is one of the provinces with quite developed irrigation systems in the Central Highlands Dak Lak province's population is about 1,833,698 people with 48 ethnic groups and the labor force/total population ratio is about 60% Dak Lak is one of the provinces with many customs and diverse cultures 16 c Current status of production of perennial industrial crops in Dak Lak province The area of perennial industrial crops in Dak Lak province in 2018 is 324,859 Although the production of perennial industrial crops is only a small subsector in the agricultural sector, in Dak Lak province, the production of perennial industrial crops plays a very important role in the province's agricultural sector The production of perennial industrial crops accounts for 51.38% of the total agricultural land area of the province, as well as contributes nearly 50% to the total production value of the field Perennial industrial crops in Dak Lak province include coffee, rubber, pepper and cashew, of which coffee is the most commonly grown crop Area of perennial industrial crops in Dak Lak province is relatively stable and productivity tends to increase slightly over the years 3.2 Current status of economic linkages between enterprises and farmer households in the production of perennial industrial crops in Dak Lak province a Scale, form and model of economic linkage between enterprises and farm households in the production of perennial industrial crops in Dak Lak province Economic linkages between enterprises and farmers are a relatively common activity in the production of perennial industrial crops in Dak Lak province The area of coffee, pepper, cashew and rubber with economic linkages is 224,925 hectares, accounting for 74.59% of the total area of coffee, pepper, cashew and rubber in the province In the period 2014-2018, the size of the combined area of perennial industrial trees in Dak Lak tends to expand over time, but this expansion is not large, only 2.2% per year Economic linkage in the production of perennial industrial crops is a fairly common activity, however, the association done in the form of written contracts is still quite low Economic linkages with text contracts in the production of perennial industrial crops in Dak Lak only accounts for 10.61% of the total economic linkages According to Decree 98/2018/ND-CP dated July 5, 2018, of the Government on policies to encourage the development of cooperation 17 and association in the production and consumption of agricultural products, economic linkages between enterprises and farmer households in agricultural production have forms In the above forms, economic linkages between enterprises and farmers in the production of perennial industrial crops in Dak Lak appears in four forms: Form Supply Production - Harvest - Processing - Consume; Form 2: Supply Consumption; Form 4: Supply - Production - Harvest - Consume; Form 5: Production - Harvesting - Processing - Consumption In which, the second form of linking is the most popular form of linkages, accounting for 80.65% of the total area with linkages Eaton et al (2001) said that economic linkages between enterprises and farmer households are made four models: centralized model, nuclear farm model, intermediary model and informal model And the economic linkage between enterprises and farmers in the production of perennial industrial crops in Dak Lak province appears all four models, of which the informal model is the most popular one b The role and position of stakeholders in the economic linkage between enterprises and farmer households in the production of perennial industrial crops in Dak Lak province Economic subjects in economic linkage to the production of perennial industrial crops in Dak Lak province include as follows: enterprises, farmers and cooperatives - cooperative groups Every participating in the association all have their own roles in the process of the association Enterprises will play the role of selling agricultural products, transferring science and technology, supplying, lending, supporting materials While, farmers will play a key role in implementing agricultural production and supplying agricultural products to enterprises In the economic linkage between enterprises and farm households for the production of perennial industrial crops in Dak Lak, enterprises are subject to a better position than farmers In this association relationship, enterprises are often the ones deciding to let the content of the linkage process, farmers only participate and follow the proposals that the enterprises makes 18 c Motivation of subjects when participating in economic linkages between enterprises and farmer households in the production of perennial industrial crops in Dak Lak province For enterprises, the main motivation for them to join the association is to have quality raw materials, consistent with their input standards and ensure the stability of raw materials; Expand the consumer market for agricultural materials; Building and developing brands or implementing government policies For farmers, the main motivation for them to join the linkage is to consume agricultural products stably and sell farm produce at a higher price to increase their income; Having land for production; Having the opportunity to access investment capital from enterprises or have the opportunity to access advanced technical and industrial processes d Organize the implementation of economic linkages between enterprises and farmer households in the production of perennial industrial crops in Dak Lak province The process of implementing economic linkages between enterprises and farmers in the production of perennial industrial crops in Dak Lak has many remarkable points, but there are also some shortcomings In the process of organizing and implementing the association, enterprises have paid attention to the selection of associated areas; focus on propaganda, persuasion and selection of associate partners Commitment content of many cases linkages reasonably and strickly The majority of entities participating in the association have complied and properly implemented the initial agreed commitments This has made many cases that the association is successful and is maintained in the following production seasons In addition to the positive points, the process of organizing the implementation of economic linkages between enterprises and farmers in the production of perennial industrial crops in Dak Lak province also has some weaknesses: Linkages’ content of some cases lack of coherence and legal status; Some entities participating in the association have not properly implemented the original agreed commitments; This has resulted in many cases where the linkages has low efficiency or failure and is not maintained in subsequent seasons 19 e Efficiency of economic linkages between enterprises and farmer households in the production of perennial industrial crops in Dak Lak province Although the economic linkages between enterprises and farmers in the production of industrial crops still exists, this activity also creates many positive impacts on the subjects involved in the association and the surrounding environment Linkage activities contribute to increase productivity for perennial industrial crops; Contributing to increase profits for farmers participating in the association; The linkage between enterprises and farmers in the production of perennial industrial crops has also contributed to changing the way of organizing the production of perennial industrial crops; Promote the application of science technology to the agricultural production process; Increasing access to capital for farmers; Or contribute to minimizing the negative impacts of the production of perennial industrial crops on the surrounding environment 3.3 Analysis of factors affecting economic linkages between enterprises and farmer households in the production of perennial industrial crops in Dak Lak province in the past a Objective factors The objective factors affecting the economic linkages between enterprises and farm households in the production of perennial industrial crops in Dak Lak province include as follow: State policies and mechanisms (at central level); The managerial role of local government; Market factors and market development level; The role of the intermediaries; International economic linkages; Science and technology; Traffic system; Agricultural production scale, level and advantages in agricultural production of the locality b Subjective factors Subjective factors affecting the economic linkages between enterprises and farmer households in the production of perennial industrial crops in Dak Lak province include as follow: Demand for association, level of awareness and capacity to implement linkages of the enterprises; The need for association, level and capacity of the household 20 to perform the association; Quality of commitments; And compliance with commitments CHAPTER VIEWPOINTS, ORIENTATIONS AND SOLUTIONS TO PROMOTE ECONOMIC LINKAGES BETWEEN ENTERPRISES AND FARMER HOUSEHOLDS IN THE PRODUCTION OF PERENNIAL INDUSTRIAL CROPS IN DAK LAK PROVINCE 4.1 Viewpoints and orientations for development of economic linkages between enterprises and farm households in the production of perennial industrial crops in Dak Lak province a Viewpoints on developing economic linkages between enterprises and farmer households in the production of perennial industrial crops a) Economic linkage between enterprises and farmer households is a prerequisite to ensure production of perennial industrial crops in Dak Lak province towards efficiency and sustainability Joining the association will help farmers overcome their weaknesses that are difficult for themselves to solve b) The process of implementing economic linkages between enterprises and farmers must ensure the rights and responsibilities of stakeholders, associated with efficient and sustainable production and consumption of agricultural products There are no economic subjects participating in the association, but themselves not benefit from the linkage process c) The State plays an important role in creating a fair and transparent legal environment, developing infrastructure and implementing practical support policies for stakeholders in economic linkages in production perennial trees b Orientation to promote economic linkages between enterprises and farmer households in the production of perennial industrial crops in Dak Lak - Establishing regions linking agricultural production and consumption in the direction of developing large-scale commodity agricultural production, strongly applying high technology, having advantages and having a market 21 - Focusing, giving priority to supporting key commodity industries in the chain of production linked with consumption and large scale, taking enterprises as the nucleus of commodity value chains, creating all conditions for domestic enterprises and FDI enterprises develop - Investing in the development of transport and irrigation infrastructure in key linkages areas and effectively implement policies to support the creation and development of horizontal and vertical linkages - Development of production organizations (horizontal-linking) by capacity building for cooperative economic organizations such as cooperatives and cooperative groups to connect smallholder farmers with sufficient governance capacity, economic and commodity yields to engage effectively with enterprises 4.2 Some basic solutions to promote economic linkages between enterprises and farmer households in the production of perennial industrial crops in Dak Lak province in the coming time Based on the research results of the current situation, lessons learned, a number of groups of solutions are proposed to promote economic linkages between enterprises and farmers in the production of perennial industrial crops in the coming time, include as follow: For both farmers and enterprises: Ensuring the long-term benefits of economic linkages; Use written contracts to express committed contents; Coordinate the settlement of "arising disputes" in the implementation of economic linkages For farming households: Production organization to develop collective economy; Training improving production techniques; Promote the application of technical advances and innovate crop production technology; Strengthen horizontal linkages; Farmer organizations approach legal service providers to improve the quality of associated contracts; Adhere to the correct technical process, ensure credibility when joining the link; Apply technology in all stages of production, mechanization, automation and farming household diary recording For enterprises: Improve management capacity and market access; Strong application of technical advances of technology 4.0; To strictly comply with contractual commitments; Develop a strategy to develop raw material areas; Support farmer organizations to master the technical process, supervise the implementation process; Support farmer 22 organizations to remove capital difficulties The policy solutions to note include: Investing in upgrading the transport and irrigation infrastructure to ensure increased efficiency for agricultural production in general and perennial industrial crops in particular; To develop cooperatives and cooperative groups for the production and trading of perennial industrial crops; Building a model economic linkage; Encourage the application of science - technology to the linking process; Human resource training 4.3 Recommendations to central state management agencies and local governments For local state management agencies: It is necessary to have the participation of the whole political system, departments, branches and grassroots authorities at all levels; Complete the management mechanism to ensure economic linkages are implemented according to the set objectives; Continue to improve the investment environment to attract enterprises to join the association with farmers in the production of perennial industrial crops; Strengthen propaganda and wide-ranging popularization of policies to stakeholders in economic linkages; Improve efficiency of the role of "arbitrator" of state agencies for economic linkage For central state management agencies: It is necessary to issue a circular guiding the implementation of Decree 98/2018/ND-CP; Improving economic linkage institutions by using written contracts 23 CONCLUSION Economic linkage between enterprises and farmer households in perennial industrial crops is the coordination of activities and mutual assistance in the production and consumption of perennial industrial crops between enterprises and farmers, in some cases, there is an additional intermediary, in order to achieve the economic goals of the parties on the basis of the principles of voluntary, equality, mutual benefit and within the legal framework Among the three types of economic linkage above, the economic linkage between enterprises and farmers is the first type of vertical linkage Economic linkage in the production of perennial industrial crops in Dak Lak, we see that this activity has made successes: This is a fairly popular activity, implemented in many forms and models, the process of organizing the linkage is relatively good, many stakeholders in the association quite comply with the original commitments and the process of implementing the linkages has brought many positive effects for the partners participating in the association such as: helping to increase the efficiency of production processes, stabilizing raw materials for factories, changing the organization, speeding up the application of technology in agricultural production or contributing to environmental protection However, there are still many shortcomings and shortcomings: At present, there are many cases where enterprises still have a dominant role in association activities; "deep" linking and linking in the form of written contracts are still small; In some cases, the process of organizing the implementation of economic linkages still has many shortcomings, in which the entities participating in the association fail to comply with the original commitments such as payment commitments, commitments to product quality The reason for the limitation is mainly: the qualifications of many farming households are still weak, familiar with production, people not trust the arbitration role of state agencies, investment environment in Dak Province Dak Lak has not attracted many businesses to invest and linkages with farmers, the financial capacity and market access of many enterprises in the province is still lacking To promote economic linkages between enterprises and farmer households in the production of perennial industrial crops in Dak Lak in the coming time, the State management agency on the central level, local authorities and stakeholders need to synchronously implement many appropriate solutions 24 LIST OF RESEACHS HAS BEEN PUBLISHED Nguyen Thanh Phuong (2019), International experience in economic linkage between enterprises and farmers in agriculture, Review of Finance [02 - March 2019 (701)], pp.77-79 Nguyen Thanh Phuong (2019), Current situation of economic linkages between enterprises and farm households in the production of long-term industrial crops in Dak Lak Province, Viet Nam Trade and Industry Review (03 – March 2019), pp.80-85 25 ... participating in economic linkages between enterprises and farmers in the production of perennial industrial crops The position of subjects in the economic linkages between enterprises and farm households. .. of production of perennial industrial crops in Dak Lak province The area of perennial industrial crops in Dak Lak province in 2018 is 324,859 Although the production of perennial industrial crops. .. form and model of economic linkage between enterprises and farm households in the production of perennial industrial crops in Dak Lak province Economic linkages between enterprises and farmers