[Vnbiz] the milk crisis in VN [SEC=UNCLASSIFIED]

[QuangAnh.Nguyen at dfat.gov.au]

Dear brother Hoanh

Thanks so much for your analysis.

I would like to have only one another comment on this matter: it's really
ashamed.

Especially given that VNM share became one of the hottest, most profitable
one on the Vietnamese premature stock market.

All the best
----------------------------------------------
Nguyen Quang ANH








                                                                           
             "Tran Dinh                                                    
             Hoanh"                                                        
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[Vietnam Business Forum]





Dear Brother Quang Anh & CACC,

The mild crisis is actually much more than the deceptive practice of using
powder milk for "fresh" milk.  Probably you realize that the media has
recently reported that the milk-cow flock of Vietnam is disappearing and
many farmers have lost their shirts for raising milk cows.

I think the real problem is in Vinamilk.  This company, praised as the most
successful company in Vietnam, has killed the milk-cow flocks.  Vinamilk
does not want to use fresh milk from Vietnamese farmers.  It uses powder
milk in many of its products and do not support farmers to produce fresh
milk.   Please note, Vinamilk was (and probably is, even after going public
with its stocks,) a state-owned company with an almost monopoly over the
dairy-product market, such as milk, ice cream, etc.

Normally, fresh milk can survive only when a large company contracts
the farmers to raise cows and produce milk, and the company buys the milk
from farmers.  It is a kind of guarantee-buying contract.  That is how
farmers can survive and the company can have a sure source of supply.  But
Vinamilk has no long-term vision.  Its doesn't care. It has no serious
competition from anyone.  It only wants to rely on its monopolistic power
to gain short-term profits.--using cheap products whenever it can, to gain
quick money.  It doesn't want to invest time and effort in training and
supporting farmers, and money in investing in fresh-milk facilities.

This fresh milk issue is a huge failure of the government's agriculture
(un)planning.

Have a great day, brother Quang Anh and all!

Hoanh



On 10/11/06, QuangAnh.Nguyen at dfat.gov.au <QuangAnh.Nguyen at dfat.gov.au >
wrote:
[Vietnam Business Forum]









Dear CACC

Please see attached an interesting article on the current milk quality
crisis in Vietnam. In short, as you may see in some other news recently,
the Government has started an inspection on quality of so-called "fresh
milk" produced by domestic milk companies (including both foreign invested
and local invested companies). It is said that a large proportion of the
"fresh milk" selling in Vietnam market are made from powdered milk...Of
course, the mill companies can make a lot of $$$ from this intransparent
process.

This scandal reflect a very unfair relation between the two side: producers
and consumers. The consumer protection legal framework is there, but
enforcement is quite poor (I remember this issue has been mentioned some
time ago on our forum).

Regards

----------------------------------------------
Nguyen Quang ANH

(See attached file: Nghich ly cua sua.pdf)


--
Tran Dinh Hoanh, LLB, JD
Attorney of Law
Washington DC
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