Thi Thanh Dung Huynh, Popova L.V. Dynamics and Economic Efficiency of Digital Transformation of Vietnam’s Coffee Industry

Thi Thanh Dung Huynh
Volgograd State University, Volgograd, Russian Federation

Larisa V. Popova
Volgograd State Agrarian University, Volgograd, Russian Federation

Abstract. Coffee is Vietnam’s main exported product. It accounts for approximately 90% of the country’s annual exports. In the beginning of the 20 th century, Vietnam was the second largest world exporter of coffee after Brazil. However, the quality was low, and the product lost out in price. The economic efficiency of production and processing was not high because of traditional technologies which were used, so the contribution to the country’s economy was considerably lower than it could be with the use of digital innovations. Currently, there are no completed studies of reasons for the low efficiency of Vietnam’s coffee production and processing, and of the analysis of innovative transformations’ dynamics. Therefore, the purpose of the study is to reveal the role and advantages of innovative digital technologies in coffee production and determine their economic efficiency. The results of the study suggest that over the past two decades, the global “coffee” market industry has expanded significantly; the demand for coffee grew by 65%. That is the main driver of development and a source of income for more than 12 million farms (more than 25 million families) in producer countries. The manual coffee production used in Vietnam cannot compete with modern digital technologies of countries that are leaders in the coffee market (Brazil, India, Thailand, etc.). The experience in introduction of technologies with international certification according to product quality standards on the area of 125.785 hectares in 2017, in the provinces Daklak, Lam Dong, Gia Lai and Kon Tum showed an increase in productivity by 10–30%. In the structure of Vietnamese coffee exports, 95% is green coffee, so export income is three times lower than the cost of processed coffee beans. Thus, the application of innovative digital technologies of cultivation and processing is a vital factor in the Vietnamese coffee industry. The result of their introduction will be sustainable development of coffee production, competitiveness growth of Vietnamese coffee products in the world market.
Key words: Vietnam, coffee industry, productivity, cultivation, processing coffee bean, economic efficiency, application innovative digital technologies.
Citation. Huynh T.T.D., Popova L.V., 2023. Dynamics and Economic Efficiency of Digital Transformation of Vietnam’s Coffee Industry. Regionalnaya ekonomika. Yug Rossii [Regional Economy. South of Russia], vol. 11, no. 1, pp. 125-134. DOI: https://doi.org/10.15688/re.volsu.2023.1.12

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