Billion-dollar agricultural farm abandoned due to illegal investment

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According to Nhat Thong Agricultural Company Limited (headquartered in Ho Chi Minh City), at the time of signing the contract, Dakruco provided cooperative land that was approved by the Dak Lak Provincial People's Committee for conversion to grow other agricultural crops applying high technology in Official Dispatch No. 2420/UBND-NN&MT dated March 29, 2019 at Cu Bao rubber plantation (Buon Ho Town).

During the investment process, in April 2020, the Provincial People's Committee established an inspection team for Dakruco on land use and labor.

Nhat Thong invests about 130 billion VND in high-tech agricultural system

According to the conclusion of the Provincial People's Committee's Inspection, on September 18, 2019, Dakruco signed a cooperation agreement with Tuan Hung Tay Nguyen Company Limited with an area of ​​over 113 hectares, the contract implementation period is 24 years. At the same time, Dakruco cooperated with Nhat Thong Agricultural Company Limited with an area of ​​over 275 hectares, the contract implementation period is 24 years.

At the time of inspection, Tuan Hung Tay Nguyen invested about 40 billion VND to plant short-term crops interspersed with perennial crops such as bananas, avocados, jackfruits and durians on an area of ​​about 109 hectares; built a number of factory buildings, workers' housing, material warehouses, communal dining halls and water reservoirs.

Similarly, Nhat Thong invested about 130 billion VND to grow avocado, mango, durian, cocoa, sweet potato, banana on an area of ​​about 257 hectares; build greenhouses, net houses, barns, farms for raising cows, pigs, chickens, ducks, and earthworms on an area of ​​about 7 hectares; pumping stations, warehouses, and water reservoirs on an area of ​​about 0.72 hectares.

According to the Inspection Conclusion of the Provincial People's Committee, on March 29, 2019, the Provincial People's Committee issued Official Dispatch No. 2420 on converting crop structure towards applying high-tech agriculture of Dakruco.

Accordingly, the Provincial People's Committee agreed to assign the representative of state capital at Dakruco to vote in favor of the policy of converting the crop structure towards high-tech application. Thus, the Provincial People's Committee has not yet issued a document agreeing in principle for Dakruco to implement the high-tech agricultural investment project at Cu Bao Rubber Plantation.

On the other hand, Dakruco transformed its model from Dak Lak Rubber One Member Co., Ltd. into a joint stock company since 2018. According to regulations, from the date of being granted the first Certificate of Registration of Joint Stock Enterprise, the equitized enterprise is responsible for carrying out procedures to be allocated land and leased land by the State according to the Land Law.

However, at the time of inspection, Dakruco had not yet been re-signed a land lease contract by the Provincial People's Committee as prescribed. In addition, this land area was leased by the Provincial People's Committee and the land rent was paid annually. Therefore, Dakruco's cooperation in investing in agricultural production and business with Tuan Hung Tay Nguyen and Nhat Thong is not within the rights of economic organizations that are leased land by the State and pay annual land rent as prescribed in Clause 1, Article 175 of the 2013 Land Law. Therefore, Nhat Thong and Tuan Hung Tay Nguyen stopped planting new fruit trees with long-term cycles and building works directly serving agricultural production.

Harmony is needed for common development.

In mid-May, Nhat Thong farm in Dak Lak province had only over 100 skinny cows grazing on clumps of grass and banana bushes without anyone taking care of them. Intercropping with cocoa and durian trees, the old South American banana trees had just begun to bloom but could not be harvested due to poor quality. In the mango growing area, the grass grew more than 30cm high, intertwined with pepper and coffee poles. In addition, greenhouses, barns, water pumping stations, etc. were also "covered".

Nhat Thong Farm temporarily stopped operating for more than a year, causing great damage

Mr. Pham Huu Thoi, Director of Nhat Thong, sadly confided that, according to the conclusion, it is only possible to grow short-term crops. However, the circular economic model requires that the waste of one product is the source of nutrition for another product, so Nhat Thong cannot continue to invest. Therefore, Nhat Thong proposed to re-sign the investment cooperation contract between Nhat Thong and Dakruco, separating the above land for the new legal entity established under the new cooperation contract and recording the actual capital contribution ratio on the value of the two parties' investment.

After the inspection conclusion, in July 2022, Dakruco sent a document to the Provincial People's Committee, proposing a plan for the two parties to liquidate the contract and re-sign the business cooperation contract after completing the procedures for investment approval to transition the agricultural production cooperation process. However, Nhat Thong agreed to re-sign the contract but wanted to continue investing in this project in the form of direct land lease for independent investment. Therefore, this issue is not under the authority of Dakruco and the representative of the state capital at the company. Therefore, the company proposed that the Provincial People's Committee consider, direct and provide guidance for Dakruco to organize the implementation.

Director of the Department of Agriculture and Rural Development of Dak Lak province Nguyen Hoai Duong talks to the press

Mr. Nguyen Hoai Duong, Director of the Department of Agriculture and Rural Development of Dak Lak province, said that in January 2023, the department received an official dispatch from the Department of Planning and Investment of the province with comments on handling the petition for Nhat Thong. The Department of Agriculture and Rural Development reported to the Provincial People's Committee to carefully consider this issue when handling Nhat Thong's petition, otherwise the matter will be prolonged and land use will be ineffective, affecting the production and business efficiency of both enterprises and the agricultural development of the province.

Based on the land use situation of Dakruco, whether the company returns it or not is only a matter of opinion, while the Provincial People's Committee, which owns 98.94% of the shares, is the one who decides. On the other hand, according to the socio-economic development plan of the province, when the province has a policy to call for investment on the land area that Dakruco is managing and a list of projects calling for investment, Dakruco will hand it over to the province for implementation in accordance with regulations.

According to the Department of Agriculture and Rural Development, at point d, clause 3, article 62 of the 2013 Land Law, the Provincial People's Council can reclaim land to serve concentrated agricultural production in accordance with the socio-economic development orientation of the province, such as implementing concentrated agricultural production and processing projects. After reclaiming the land, a bidding for the project will be organized. If the winning bidder is Nhat Thong, it will continue to lease the land for implementation. If another unit wins, the invested portion will be returned to Nhat Thong.

The project in association with Nhat Thong and Dakruco is expected to have great potential for development. Nhat Thong has been highly appreciated by the province and the Ministry of Agriculture and Rural Development for its production of a circular economic organic model, which does not pollute the environment and develops sustainably. It can be seen that the investing enterprise will become the nucleus to spread to farmers for development.

Source: https://www.sggp.org.vn/trang-trai-nong-nghiep-tien-ty-bo-hoang-do-sai-phap-ly-dau-tu-post690488.html