Danish Aid behind Vietnamese Fishing Adventure

Impressively clean and oozing with sanitary care – and the smell of fish – 44 year-old Truong Thi Le Khanh’s new fish factory lies in the outer proximity of Ho Chi Minh City. Only one month ago, she saw the very first freshly caught fish and shellfish arrive through the gates. Within the end of the day, new equipment from Denmark and lots of newly-trained Vietnamese hands have turned them into exotically prepared specialties heading for Europe.
     As a good example of the rapid development, which Vietnam’s fishing industry has undergone within the last 10 years, Khanh has seen her own fish processing company, Vinh Hoan Co. Ltd., go from being a small provincial factory with 150 employees in 1997 to consisting of two modern production plants with a total of 1500 workers and an annual turn-around of 32 million dollars.
     Today, more than 150 Vietnamese fish processing companies have been approved to export to the EU. Just like most of these companies, Vinh Hoan has benefited from the foreign aid assistance. In just 10 years, it has brought Vietnam up among the world’s elite exporters of fish and shellfish. With more than 42.3 million USD, Denmark has delivered more than half of all foreign aid to Vietnam’s fishing industry, since the development really took off in 1994.
     One of the biggest problems to restrain the Vietnamese fishing industry when Danida initiated its support to the sector back then, was the lack of expertise in the processing process. There were lots of fish, but without cooling facilities, transport means, and hygienic standards it was more or less impossible to the Vietnamese to sell their catch on the international market. In 1994, Vietnam only exported fish and shell fish for 551 million USD. Today, the export is more than quadrupled to 2.4 billion USD, which makes Vietnam one of the leading fish exporters in the world – with the EU, USA, and Japan as the main markets.

A Fast Learner
So far, Vietnam’s fishing adventure has created thousands of new jobs, and the fish processing factories has undergone an extensive modernization, increasing the product quality significantly compared to just a few years ago. Previously, the Vietnamese fishermen mostly worked to fill their own families’ food bowls and to sell a small batches to the local market. Today, an increasing amount of the raw materials come from breeding – partly marine and partly brackish water. In 2004, shrimp made up over 50% of the export turn-around. The fishermen and the shrimp breeders sell their goods to collectors and middlemen, who then deliver to the processing industry. It typically takes under 24 hours from the fish/shrimp is caught till it arrives at the factory.
     Both even though Denmark has played a central role in this development with money and know-how, the will of the Vietnamese has been an equally important component in the success.
     As opposed to many other aid receiving countries, Vietnam participates extremely actively in putting the support funds to use, and almost all foreign support to Vietnam’s fishing industry is canalized through the nation’s Ministry of Fisheries. As the unparalleled largest foreign donor, Denmark has thus worked closely together with this ministry, and the cooperation has birthed great Danish faith in the long-lasting effect of the development.
     “The Vietnamese are both quick and willing to learn. They constantly have their antennas out to see who they can learn something from. Once they have achieved an understanding and a competence within a certain area, then they take things and run with it. The development within the fishing sector is the best example of this,” explains the Danish Ambassador in Hanoi, Peter Lysholt Hansen.
     “They are strongly determined to have an economic growth, and in the end, that is what makes the aid efforts so successful in this country,” he says about Vietnam, which is the country in the entire world to receive the second-largest amount of aid funds from Denmark this year – with over 59.1 million USD in 2005. Only Tanzania receives more this year.

More Fish on the Way
For Truong Thi Le Khanh, the export increase is even more closely connected to Denmark. In addition to having taken advantage from the general development, which the Danish support has brought about in Vietnam, her company is also involved in one of Danida’s so-called Private Sector Programmes, which are to enhance the cooperation between Danish and Vietnamese companies. This specific project has run since 2002 and has received a total of 460,000 USD in support from Danida.
     Today, Vinh Hoan works closely together with Gamba Food A/S from Slagelse, Denmark, who has specialized in import and export of exotic fish and shellfish from all over the world. This has further increased the company’s sales to Denmark and the EU and made the need for the new factory even more evident. Besides this, technical competence in regards to production, product development, hygiene, quality control, and management has been transferred to Vinh Hoan from Denmark. The project has managed to create 750 new jobs.
     Unannounced visits from inspectors of the Ministry of Fisheries help secure the quality standard of the fish and a high level of hygienic maintenance of both Vinh Hoan’s factories and the more than 150 other fish factories, which are selling to the EU.
     In 2000, Denmark’s support to Vietnam’s fishing sector was made into a more systematic programme, of which the first phase is concluded by the end of this year. In agreement with the Vietnamese Ministry of Fisheries, Denmark is ready to initiate phase two in the beginning of 2006, where Danida expects to spend approximately 37.2 million USD over the next five years.

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