Finance and farming: Understanding development finance and industrial animal agriculture in Vietnam

Abstract

This report examines the role of public development banks in financing industrial animal agriculture in Vietnam, highlighting the complex interplay between economic development goals, food security, and environmental sustainability. Vietnam's livestock sector, dominated by pig and poultry production, is undergoing a significant transition from traditional smallholder farming to industrial animal agriculture, driven by government policies, rising local and global meat demand, and corporate investment. Despite climate commitments, public development banks like the World Bank Group and Asian Development Bank continue to provide significant funding for industrial livestock operations, feed production, and processing infrastructure in Vietnam. This financing often contradicts sustainability goals and contributes to environmental degradation, while transparency and accountability remain significant challenges. The report explores the institutional drivers behind this funding, including deeply embedded beliefs in development banks about animal protein's importance for nutrition and development. In addition to identifying structural barriers to change, the report also points out emerging opportunities, such as growing recognition of sustainability issues and rising consumer awareness. For frontline organizations and policymakers, the report provides practical recommendations to redirect development finance toward sustainable alternatives, from leveraging accountability frameworks to promoting transition finance models that support smallholders and regenerative agriculture practices, ultimately calling for a just agricultural transition in Vietnam