Rubber replanting is exempt from land rent

The Prime Minister has agreed to exempt from land rent for rubber replanting in basic construction period from 2015 to 2020. 

Rubber replanting is exempt from land rent

Prime Minister assigned the Ministry of Finance to guide local people the implementation of land rent exemption under the provisions mentioned above; Ministry of Finance and other relevant agencies implement together.

It is a positive move after the Vietnam Rubber Association submitted recommendations to related ministries. According to the recommendations of the Association, the rubber industry is currently facing many difficulties such as oversupply, low rubber prices and no signs of recovery before 2020. According to the Ministry of Agriculture and Rural Development Rural, in 2013, rubber price reached nearly 52 million VND/ ton, followed by decreases to 37 million VND/ ton and 30 million VND/ ton in 2014 and 2015 respectively. In 2016, if crude oil prices continue to plunge, the rubber price could fall to 20 million VND/ ton.

However, in this difficult context, the Decree 46/2014/ND-CP which was born and came into effect from 07/01/2014 laid an extra burden on the rubber growers when prescribes construction time of replanting rubber gardens is not exempt from land rent while before 01/7/2014, rubber garden planting and replanting were both exempt from land rent.

The association also said that from 2015 onwards, rubber industry restricts new planting, mainly carries out replanting rubber areas which go over the exploitation cycle, about 20 thousand to 30 thousand hectares/ year. There is also need to invest capital in renovation, replanting and caring from 6 to 8 years. During this time, the rubber replanting gardens do not have any product and also revenue, profits, thus making it difficult for the payment of land rent for rubber plantation, on the other hand increasing the cost of investment, rising price and causing growers to switch to other crops.

Hung Nguyen

Source: thitruongcaosu.net