Estimation of the virtual water trade of agricultural products between Vietnam and China

Abstract

China not only serves as a significant trading partner for agricultural products with Vietnam but also holds a strategic position as an upstream neighbor in Vietnam's major river basins, thereby influencing the nation's water security. This research initially examines the Vietnam-China relationship through the lens of virtual water trade in agricultural goods, analyzing the period from 2010 to 2021. Findings reveal Vietnam's status as a virtual water deficit country vis-à-vis China, a trend that has been progressively worsening. Vietnam acted as a virtual water exporter during this period, exporting around 98 billion m³ to China while importing 10.96 billion m³. Both nations share similarities in virtual water structure due to similar climatic conditions and technical advancement levels. In terms of product structure, Vietnam emerges as a strategic partner, predominantly supplying China with agricultural products derived from plants. However, this structure lacks balance and is primarily centered around a select few products such as soybean oil (constituting 20.77% of virtual water imports) and manioc starch (constituting 33.48% of virtual water exports). The virtual water trade between Vietnam and China reflects a negative net import, with both countries possessing renewable internal water freshwater resources per capita lower than the global average. While Vietnam currently supports China in addressing water scarcity challenges, diversifying export markets and optimizing the import-export framework with China can enhance Vietnam's resilience and contribute to long-term water sustainability. Consequently, prioritizing policies aligned with the virtual water perspective will empower Vietnam to effectively manage water scarcity, ensuring its future sustainability.