Cooperative-Enterprise Linkages: A Key to Building a Sustainable Agricultural Ecosystem

Large-scale, sustainable agricultural development is increasingly pushing the need to connect enterprises and cooperatives through value-chain linkages. The shift is also prompting a reassessment of cooperatives’ role within the private economy ecosystem, with the goal of improving efficiency, competitiveness, and rural incomes.

As of March 2026, the country had about 35,197 cooperatives with nearly 7 million members. Officials said no economic sector can develop in isolation: enterprises need stable raw materials, farmers require sustainable outlets, technology needs a supportive environment, and finance depends on viable models—making enterprise-cooperative linkage a necessary objective.

Cause: demand for integrated, sustainable value chains

Deputy Director Mr. Do Manh Khoi of the Private Sector Development and Cooperative Economy Department (Ministry of Finance) said enterprise-cooperative linkages increasingly show a symbiotic relationship. He noted that such linkages can help cooperatives expand activities, reduce input costs, and raise profits, while improving members’ productivity, product quality, and competitiveness.

At the same time, Deputy Director Ms. Nguyen Thi Hoang Yen of the Cooperative Economy and Rural Development Department said that, in practice, linkages between the two sectors remain loose and lack systemic coherence. Enterprises often operate independently rather than closely linking with cooperatives in production organization and input procurement. She added that relationships are frequently short-term and unstable, contract and risk-sharing mechanisms are unclear, and trust between parties is limited.

With agriculture moving toward large-scale, green, and sustainable commodity production, officials said fragmented development is no longer suitable. Instead, they called for an integrated ecosystem in which enterprises lead market development, cooperatives organize production, and the state creates and coordinates enabling conditions.

Development: policy proposals to strengthen binding linkages

The policy proposals discussed include completing value-chain linkage institutions in a coherent, transparent, and binding manner. They also call for revising policies to simplify procedures, devolve responsibilities to localities, and cover all participants.

Speakers emphasized the need for a clear mechanism for sharing benefits and risks, standardizing contracts, and linking arrangements to agricultural insurance to strengthen trust and improve implementation. They also highlighted the importance of a policy framework that integrates production, market access, finance, and science & technology to support sustainable development.

Data and context: private-sector scale and cooperative finance constraints

In 2025, nearly 1.02 million enterprises were operating nationwide, with about 297,500 entering or re-entering the market, an increase from the previous year. State budget revenue from the non-state sector in 2025 was estimated at 497,156 billion VND, reaching 134.2% of the estimate and up 26.8% from 2024.

On the banking side, Deputy Governor Mr. Nguyen Ngoc Canh of the State Bank of Vietnam said agricultural credit policies have been adjusted to be more favorable. He noted that the unsecured loan limit for cooperatives has been increased up to 5 billion VND, and that models linking production or applying high technology can borrow up to 70–80% of project value without collateral.

By the end of January 2026, outstanding agricultural and rural credit stood at about 4.2 quadrillion VND, accounting for more than 22% of total credit in the economy. However, credit for cooperatives remains limited, which officials attributed to limited internal capacity, small scale, non-professional management, and insufficient readiness to meet value-chain linkage requirements.

Impact: shifting from off-take to shared capital and risk

At the forum, enterprises shared experiences on cooperating with cooperatives. Mr. Tran Manh Bao, President of ThaiBinh Seed Group, described an initial model based on off-take agreements with cooperatives, including providing seeds, technical support, and a commitment to purchase. He said the model showed limitations when markets fluctuated or when risks such as natural disasters occurred, causing links to break.

ThaiBinh Seed said it has since established more than 70 linkage points nationwide, covering nearly 8,000 hectares, with an annual procurement volume of about 30,000 tons. The company now implements three levels of cooperation with cooperatives: (1) substantial and binding off-take commitments; (2) technology transfer and training for green cultivation techniques; and (3) capital contribution and shared benefits, described as a long-term strategic direction.

Mr. Bao said moving from off-take to capital contribution changes the relationship by sharing benefits and risks rather than separating them. For the enterprise, capital contribution can help stabilize input regions, control quality, reduce transaction costs and contract risks, and scale up rapidly without initial infrastructure investments. He added that it can also open opportunities to access favorable policies for the collective economy.

For cooperatives, the collaboration improves access to capital, technology, and modern governance systems, strengthening production capacity and operational efficiency. It also provides more stable outputs and deeper value-chain integration, contributing to higher member incomes.

Analysis: institutional refinement to enable flexible capital participation

From this practice, Mr. Bao emphasized the need to refine the institutional framework to create a permissive environment that allows enterprises to contribute capital flexibly to cooperatives. He described this as a key step in transitioning from off-take linkage to a strategic partnership, aiming for more sustainable and efficient agricultural development.