Street food vendors required to wear face masks01:35 Street food vendors will have to wear face masks from now on while preparing food and drinks for customers and maintain a distance of at least one metre from customers, Hanoi’s Department of Health has said.
These rules must be adhered to stem the COVID-19 pandemic, even as the capital eased social distancing measures, it said. In a document sent to relevant authorities on May 7, the department required people’s committees of districts and towns to instruct all street food vendors, large kitchens, canteens, restaurants and hotels to strictly follow regulations on food safety and hygiene. Hand sanitiser and clean water are required at all facilities, and they are not allowed to serve more than 20 people at a time to ensure the required distance among customers. All food suppliers and handlers must wear face masks at work. For delivery services, all food must be wrapped before it is delivered to customers, it said. The department will inspect the implementation of these regulations. Vietnam issued regulations making it compulsory for people to wear face masks in public during the social distancing period. Those who disobeyed the regulations were fined from VND100,000-300,000 (US$4.1-12.5). In Hanoi, at least 700 violations were recorded during the period of social distancing since last month. Each offender was given a penalty of VND200,000 ($8.3). The Government has gradually relaxed social distancing restrictions to help localities resume socio-economic activities. People are encouraged to wear face mask at public places and keep the distance of one metre from each other. VNS |
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Hà Nội attractions reopen for tourists02:05 Historic sites and tourist attractions in Hà Nội reopened to tourists on Thursday nearly two months after being closed to prevent the spread of the deadly novel coronavirus.  Tourists visit the Temple of Literature which reopened yesterday after closure due to the COVID-19 pandemic. - VNA/VNS Photo Thành Đạt Sites such as the Temple of Literature, Ngọc Sơn Temple and Hỏa Lò Prison are among the attractions that welcomed tourists back while deploying safety precautions. Lê Xuân Kiều, director of the Temple of Literature’s Cultural and Scientific and Cultural Activity Centre, said preventive measures remained the top priority. The centre had temperature checks and hand sanitiser in place for visitors, he said. Visitors are required to comply with regulations related to epidemic prevention and control, such as checking their temperatures, wearing face masks and washing hands. Hỏa Lò Prison has reopened with an exhibition titled Khát vọng tự do (Aspiration for Freedom), with areas including The Chains, Flying in the Midst of the Night, and the Peace Song Nguyễn Doãn Văn, director of the management board of Hỏa Lò Prison, said the site had been regularly sterilised during the closure. “The management board will take care of the personal safety and hygiene for visitors including providing hand sanitiser for them,” he said. The Hồ Chí Minh Mausoleum in Ba Đình Square, one of the city's must-visit places, reopened on Tuesday after closing its doors to tourists on March 23. Opened in 1973, the granite memorial was inspired by Lenin's mausoleum in Moscow and was built on the spot where President Hồ Chí Minh read the Declaration of Independence on September 2, 1945. The capital city’s popular ‘walking streets’ would also reopen on Friday after being closed for more than three months, announced the People's Committee of Hoàn Kiếm District in Hà Nội. The streets around Hoàn Kiếm Lake, including Hàng Đào and Hàng Giấy, as well as Đồng Xuân Night Market, would reopen to residents and tourists from 7pm on Friday evening through to midnight on Sunday. According to the city’s Tourism Department, all visitors would have their temperatures checked and asked to wash their hands with steriliser and wear face masks before entering tourism sites. Each group of visitors would be restricted to 30 people. Pandemic effect Statistics from the department showed that the number of tourists to Hà Nội decreased during the Unification Day and May Day holidays. The total number of visitors reached 28,473, down nearly 92 per cent over last year’s figure Revenue from tourism was estimated at VNĐ91 billion (US$3.9 million), a decrease of 85.2 per cent in comparison with the previous year. The average occupancy of 3-5 star hotels was 13.4 per cent, down 56.6 per cent. After social distancing, the number of people visiting commercial and trade centres had declined by 90 per cent compared with the same period last year, said the department. VNS |
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BUSINESS NEWS HEADLINES MAY 18VN to strengthen simplification of business regulations in 2020-25 period  Tra fish processed at the Southern Seafood Corporation. Viet Nam targeted to remove and simplify at least 20 per cent of the number of regulations and reduce at least 20 per cent of compliance costs for firms by 2025. Viet Nam will strengthen the removal and simplification of business regulations in the next five-year period to create favourable conditions for enterprises and promote their development as a driver for socio-economic growth. Under the Government’s Resolution No 68/NQ-CP issued early this week, Viet Nam targeted to remove and simplify at least 20 per cent of the number of regulations and reduce at least 20 per cent of compliance costs firms incurred to adhere to Government regulations which were in effect as of May 31. The list of existing legal documents regulating business operation must be announced before October 31. At the same time, the Government’s programme also aimed to strictly control the promulgation of new legal documents regulating business operation, especially ministers’ circulars, Prime Minister’s decisions and Government’s decrees to prevent the creation of unnecessary and unreasonable regulations. This year, software providing adequate and accurate updates about business regulations and compliance costs would be put into operation, which would be a base for reviews for cuts and simplifications. Priority would be placed on regulations about checks on imported-exported products. Dialogues between the management agencies and businesses would be increased so that the quality of simplification would be improved, meaning that the effort would really bring benefits to enterprises. The Government Office’s statistics showed that the since 2016, 3,893 out of 6,191 business prerequisites had been removed or simplified, together with 6,776 out of 9,926 categories of goods subjected to customs checks and 20 out of 120 administrative procedures related to customs checks. The effort helped save an estimated 18 million workdays per year, equivalent to more than VND6.3 trillion. Viet Nam ranked 70th among 190 economics in the World Bank’s Doing Business 2020 report. Banks aid 318,000 COVID-19 affected borrowers Commercial banks cut interest rates on VND980 trillion (US$42.6 billion) of loans to support 318,000 COVID-19 affected individual and corporate borrowers by the end of April, the latest data from the State Bank of Viet Nam (SBV) showed. The interest rate reduction was commonly 0.5-2 percentage points per year. Some credit institutions even offered a higher rate cut of 2.5-4 percentage points per year. It was estimated if the banks cut the rate by 1 percentage points on average for the VND980 trillion in loans, their profits will be lowered by at least VND100 trillion. By the end of April, banks also rescheduled debt repayments for more than 170,000 customers with loans of nearly VND130 trillion, according to the SBV’s data. The SBV has required commercial banks to further simplify lending procedures to help COVID-19-affected firms easily access preferential interest rate loans. However, he noted, banks must still meet lending standards to ensure the safety and stability of the financial and banking system. Some businesses have recently claimed they could not access new loan packages with preferential interest rates due to their failure to meet banks’ lending standards and proposed that banks ease lending rules. However, Nghiem Xuan Thanh, chairman of Vietcombank, said most companies that could not access the package are inefficiently operating their businesses. Banks would not ease lending standards as they must avoid risks, Thanh noted, explaining that the package does not come from the State budget but from commercial banks. Echoing Thanh, Tran Hoang Ngan, head of the HCMC Economic Development Institute, said banks were themselves businesses so they were always afraid of bad debts. According to Nguyen Quoc Hung, director of the SBV’s Credit Department, in the current situation, it is forecast the bad debt ratio of the banking system will increase this year and negatively affect the country’s plans to deal with bad debts and recover poor-performing banks. Grab Food takes biggest bite of food delivery in Viet Nam: survey Grab Food is the most popular food delivery application in Viet Nam with 79 per cent market share, a report by Q&Me, an online market research service, revealed. Now ranked second with 56 per cent, followed by Go Food (41 per cent), Bacmin (15 per cent) and Loship (12 per cent). Q&Me has recently released a survey on the increasing food delivery demand after the COVID-19 pandemic. The survey was conducted among 840 respondents in HCM City and Ha Noi last month. Food delivery services in Viet Nam increased in popularity due to the social isolation measures imposed during the COVID-19 pandemic, said the report. Seventy-six per cent of respondents used food delivery services, out of which 24 per cent are new users who started to use food delivery services for the first time due to COVID-19. Among existing users, 70 per cent have increased food delivery usage in the last 60 days, probably due to the pandemic. As per the ordering method, delivery apps are the most popular. While users in HCM City use apps more, Hanoians have a higher ratio of social media or telephone orders. Eighty per cent are satisfied with using delivery apps because of good service and fast delivery. Seventy-nine per cent of people order food at least once per week. High shipping costs are a concern for a number of users. New urban area planned on Vung Tau Airport land A new urban area will be built on the land of Vung Tau Airport once the airport is relocated to Go Gang Island. Ba Ria-Vung Tau Provincial Standing Committee has had a meeting with Van Phu-Invest Company, VCI Company and the consultants to discuss the planning of Go Gang Airport. In exchange, the two firms asked for permission to invest in two urban area projects on the 172ha land of Vung Tau Airport. There will be a 35ha compact city, 46ha central park, 24ha for transit area and mixed commercial services, 20ha for the financial and hi-tech area and 25ha for the urban symbolic constructions. Ba Ria-Vung Tau Provincial Standing Committee showed interests in the projects but said that there must be detailed research about population density, traffic density, parking lots to connect with the city's traffic infrastructure, including both elevated and underground routes. The financial and hi-tech centre should be reviewed and changed to a hub of bank branches. The local authorities are preparing for a bidding process for Go Gang Airport. Nguyen Hong Linh, party secretary of Ba Ria-Vung Tau, proposed to include the Vung Tau-Go Gang airport project in the list of the provincial key projects to speed up the process and more rapidly deal with problems. Many people have supported the idea to relocate and replace Vung Tau Airport to Go Gang. The new airport is located next to Truong Sa Street. One side is adjacent to the river and others are next to the mangrove forests. Land prices in Vung Tau City surged as soon as it was announced that Go Gang Airport will be built on a 250 ha of land in Long Son District. A 900 square-metre plot that is about 400 metres from the road used to cost some hundreds of millions of VND but now it is being sold for VND1.6bn (USD68,200). A 700-square-metre land that is next to the supposed entrance to Go Gang Airport is being sold for VND2bn. "With higher land prices, I can sell some land to build more houses and expand business. I'm glad," a local said. Vung Tau People's Committee advised the buyers and investors to be more careful and research carefully to avoid too good to be true offers. Vietnam sees greater prospects ahead for shrimp exports Vietnamese shrimp products are expected to enjoy greater export opportunities providing that the novel coronavirus (COVID-19) shows signs of abating during the second quarter of the year following the reopening of the global market, according to the Vietnam Association of Seafood Exporters and Producers (VASEP). Despite plenty of local commodities experiencing a downward export trend, including such items as tra fish, tuna, Vietnam’s shrimp exports throughout the first quarter displayed positive signs amid complicated developments relating to the COVID-19 pandemic. At present, the United States is the second largest importer of Vietnamese shrimp, making up 18.4% of the country's total shrimp export value. During the opening three months of the year, shrimp exports to the US market enjoyed a surge of 18.2% to US$115.5 million in comparison to last year’s corresponding period. Despite the COVID-19 epidemic resulting in stagnant import-export activities to the US market along with a decline in import demand, retail stores are still buying regular goods in order to combat shortages after American consumers scrambled to purchase higher levels of stock since the start of the epidemic. As shrimp supply sources from key players such as India, Ecuador, and Thailand begin to drop as a result of various national lockdowns, several US consumers have made moves to purchase Vietnamese shrimp. Amid the domestic market, after suffering an initial fall, the price of raw shrimp in the Mekong Delta has gradually been increasing since the beginning of April. This development is expected to bring about an array of bright prospects for shrimp production ahead in the new season. While the price of raw shrimp has increased, farmers remain hesitant to move into shrimp farming because of the risks relating to the effects of drought, saltwater intrusion, disease outbreaks on shrimp, as well as the complicated nature of the COVID-19 severely affecting major consumer markets. According to the VASEP, there are positive signs ahead for the export of brackish shrimp over the course of the year thanks to high demands for shrimp globally, in addition to the epidemic being brought under control in both China and the Republic of Korea. Moreover, Vietnamese shrimp is poised to enjoy benefits relating to a substantial reduction in tax rates from the EU-Vietnam Free Trade Agreement (EVFTA), which is expected to come into effect in July, in comparison to shrimp products from India, Thailand, and other countries. In contrast, there is still plenty of risks, requiring processing enterprises and shrimp farmers needing to work closely seize opportunities when the market begins to bounce back. Which scenario for the post COVID-19 hotel market? No matter what recovery scenarios occur as the nation begins to emerge from the effects of the novel coronavirus (COVID-19), this year’s hotel market is expected to witness a sharp decline in terms of room capacity and will only get back to normal levels in 2021. This comes after Savills Vietnam, the nation’s largest property consultancy with real estate services running since 1995 stated that most hotels must move to suspend parts or all of their business operations in a bid to cut costs while keeping on only key personnel as they prepare plans to resume operations. According to Savills Vietnam, these strategies will partly offset the revenue decline faced in the short term. However, hotel owners have not been able to map out longer term plans due to the uncertainty over how long it will take for the tourism industry to return to pre-epidemic levels. Savills believes that the global economic impact and complex developments of the COVID-19 will make it challenging for the hotel industry to fully recovery in 2020, with a full recovery likely to take place by 2021. Moreover, domestic tourism demand, especially among young travelers, is set to play an important role in the process of the hotel industry’s recovery. Elsewhere, CBRE Vietnam stated that the situation with regard to the hotel market in Hanoi is more positive than that of Ho Chi Minh City. The segment of four to five star hotels in Hanoi will enjoy a faster recovery as international businesses begin to get operations back to normal. In addition, domestic guests and a small number of international visitors from Northeast Asia are poised to serve as contributory factors that drive the recovery of the Hanoi hotel market once the epidemic has been fully brought under control. According to CBRE forecast for the country, if the disease is controlled by June, the average room rate this year will drop by between 8% and 13% compared to 2019’s figure, with the occupancy rate falling by between 46% to 51%. If the epidemic is successfully contained by September, the average room rate will decrease by between 15% to 20%, with the room capacity dropping by between 50% and 55% from last year. Following this, the Vietnam National Administration of Tourism has outlined a slow recovery scenario for the country’s tourism industry with the number of international arrivals to the nation in 2020 anticipated to fall by 70% compared to 2019, providing the epidemic is brought under control in June. In a worse-case scenario, the number of international visitors will be reduced by up to 75% if the epidemic is not controlled until September. In all of the scenarios, the year will see an unprecedented slowdown in terms of the number of tourists visiting the nation, leading to a serious decline in room occupancy in the hotel market, the Vietnam National Administration of Tourism notes. Saigon Autotech & Accessories 2020 pushed back to December The 17th version of the Saigon International Autotech & Accessories Show (Saigon Autotech & Accessories) is set to be postponed from its original date of May 21 to May 24 and will now take place from December 12 in Ho Chi Minh City as a result of the novel coronavirus (COVID-19) epidemic. Despite the date change, the event will still be organised at the Saigon Exhibition and Convention Centre by the Ministry of Industry and Trade’s Department of Industry, the Asia Trade Fair, Business Promotion JSC, and the K-Wellness association of the Republic of Korea. According to organisers, the country has now entered into a new phase in fighting the COVID-19 and will work hard to gradually revive the economy following the easing of social distancing restrictions for production and business establishments as set out by the Government. Due to the complicated COVID-19 picture globally, the Government has halted all entry to foreigners in an attempt to reduce the risk of infection coming into the country from abroad. The end of the year’s third quarter is considered to represent an appropriate time to organise the event, which is expected to contribute to promoting economic and trade co-operation among local and foreign businesses, whilst simultaneously providing a boost to the automobile and supporting industries, as well as reviving the national economy. Ninh Minh Uyen, a representative of the organisers, said that over the course of recent years the global and domestic automobile industry has displayed a trend of shifting to hi-tech products through the use of artificial intelligence, robot technology, and big data that is utilised at every stage of the production process. The 17th Saigon Autotech & Accessories exhibition will take note of global trends occurring in technology in order to fully meet the development needs of the automobile-motorcycle and supporting industries based in the nation. Along with the participation of 11 international partners from Asia and Europe, foreign businesses participating in the event are expected to increase by 15% to 20% compared to previous exhibitions. Enterprises will be able to display and introduce their products in an area of 15,000 square metres across 500 booths. Overall, the event is expected to attract 15,000 visitors. Contingent of US footwear importers to hold online trade exchange with local firms An online trade exchange is scheduled to be held from May 28 to May 30 with the participation of 60 footwear importers from the United States, with the aim of supporting domestic footwear enterprises promote the export of footwear products to the US market, according to the Ministry of Industry and Trade (MoIT). The event is set to be jointly held by the MoIT, the Vietnamese embassy’s trade office based in the United States, and the Footwear Distributors and Retailers of America. Throughout the duration of the event, both representatives of state management agencies and industry associations from both sides will be granted a platform to provide updated information relating to the US footwear market in the context of the novel coronavirus (COVID-19) pandemic. Moreover, participants will be able to assess the export prospects and adaptability of the ever-changing landscape, as well as introducing the nation’s plans for developing the footwear industry and intensifying trade exchange activities moving forward in the footwear sector in relation to the US market, according to the Vietnam Trade Promotion Agency. Indeed, it is anticipated that the trade exchange will draw the participation of between 60 and 80 domestic footwear enterprises. With 2019 being considered a successful year for footwear exports due to the sector’s revenue enjoying a surge of 12.8% to US$18.3 billion against the same period from the previous year, the US now makes up the largest export market with a value of US$6.65 billion, an increase of 14.2%. Following this, the US has remained as the leading importer of Vietnamese footwear products during the first quarter of the year with a turnover of US$1.56 billion, an annual increase of 10%. Despite this, a number of contracts have yet to be finalised in the second and third quarters of the year. This can largely be attributed to a decline in consumption within the US market. Aside from a fall in order numbers, many foreign partners have suddenly cancelled orders, leading to numerous difficulties for local businesses. It is hoped that through the event both Vietnamese enterprises and US importers will be able to gain greater insights into the needs and capacities of each other, seize upon co-operative opportunities, and quickly respond to trade and market developments due to the demand for footwear in the US market predicted to bounce back once the COVID-19 epidemic is eradicated. Export of processed industrial goods drops 20% in April According to the Ministry of Industry and Trade, Vietnam's export revenue in April was estimated at US$19.7 billion, down 18.4% compared to March and down 3.5% over the same period last year. Remarkably, the processing industry dropped sharply by 20% comparing to March, estimated at US$16.4 billion. Statistics showed that exports of computers, electronic products and components decreased by 10.5% compared to March 2020, reaching US$3.3 billion. Telephones and accessories decreased by 37.9%, reaching US$3.3 billion. In addition, exports of textiles and garments decreased by 18.8%, reaching US$1.9 billion, while other machinery, equipment, tools and spare parts decreased by 8.3%, (US$1.8 billion); footwear down 6.6%, (US$1.3 billion); wood and wooden products dropped by 13.8%, (US$850 million). To support enterprises to overcome the COVID-19 epidemic in the coming time, Minister of Industry and Trade Tran Tuan Anh suggested that ministries, branches and businesses should continue to take advantage of the free trade agreements, thereby continuing to improve the cooperation frameworks with these supply chains and partners in the region and around the world. In addition, he also emphasised the need to improve policy frameworks that promote supply chain mechanisms and supply chains, both domestically and internationally, as well as accelerate the implementation of the Politburo's Resolution No.23 on industry, and Government's Decree No.111/CP on supporting industry. HCMC reclaims over VND1.8 trillion from Dai Quang Minh HCMC has reclaimed over VND1.8 trillion in unpaid land-use fees from Dai Quang Minh Real Estate Investment JSC, which developed four key road projects in exchange for land in the Thu Thiem new urban area project in District 2. The city has assigned the relevant agencies to consult with the Government Inspectorate on calculating the interest due on the unpaid land-use fees, HCMC Chairman Nguyen Thanh Phong said at a web meeting with the prime minister on May 8. Phong also presented a report on the application of the Government Inspectorate’s conclusions on the Thu Thiem project. Also, the city is auditing all build-transfer projects in the Thu Thiem new urban area, he remarked. After the inspectorate’s conclusions were announced, the municipal government established a working team to launch plans to deploy them and direct the relevant agencies to promptly apply them, he noted. Organizations and individuals guilty of shortcomings with the project have admitted their failures, the local media reported. Under the Government Inspectorate’s report on its conclusions, issued on June 26, the HCMC government was asked to pay the fees plus interest to the State budget, as the city’s use of land as a means of payment for the construction of the four roads without prior land price management or approval of the land use are illegal. HCMC reclaims over VND1.8 trillion from Dai Quang Minh HCMC has reclaimed over VND1.8 trillion in unpaid land-use fees from Dai Quang Minh Real Estate Investment JSC, which developed four key road projects in exchange for land in the Thu Thiem new urban area project in District 2. The city has assigned the relevant agencies to consult with the Government Inspectorate on calculating the interest due on the unpaid land-use fees, HCMC Chairman Nguyen Thanh Phong said at a web meeting with the prime minister on May 8. Phong also presented a report on the application of the Government Inspectorate’s conclusions on the Thu Thiem project. Also, the city is auditing all build-transfer projects in the Thu Thiem new urban area, he remarked. After the inspectorate’s conclusions were announced, the municipal government established a working team to launch plans to deploy them and direct the relevant agencies to promptly apply them, he noted. Organizations and individuals guilty of shortcomings with the project have admitted their failures, the local media reported. Under the Government Inspectorate’s report on its conclusions, issued on June 26, the HCMC government was asked to pay the fees plus interest to the State budget, as the city’s use of land as a means of payment for the construction of the four roads without prior land price management or approval of the land use are illegal. Vung Tau Airport to be rebuilt into urban area After being relocated to Go Gang Island, the existing Vung Tau Airport in the city center will be developed into an urban area. The standing board of the Party Committee of Ba Ria-Vung Tau Province has met with representatives of a consortium comprising Van Phu-Invest Investment JSC and VCI Investment JSC, and of consulting firms to discuss the development of Hai Dang new urban area and another residential area at the existing airport in Vung Tau City. The provincial government stated that the consortium had earlier written to the province seeking approval to study and invest in Go Gang Airport in Long Son Commune. Besides this, the two firms proposed developing the two residential areas. As for the Vung Tau airport, which covers some 172 hectares of land, the consortium proposed building a new urban area comprising a 35-hectare compact city, a 46-hectare central park, a 24-hectare transit and trading service complex, a 20-hectare financial and technology center and a 25-hectare complex. The standing board praised the idea, calling on the consortium to carefully assess the density of the population, the number of vehicles and the traffic flow at the projected area to work out a solution for traffic connections and the construction of parking lots. Apart from this, the consortium should reconsider the feasibility of constructing a financial center, the standing board said, suggesting gathering branches of banks in the province at the center. Nguyen Hong Linh, secretary of the provincial Party Committee, told the relevant agencies to add the urban area project at the existing airport to the province’s list of key projects to speed up preparatory procedures and promptly remove obstacles to progress, Nguoi Lao Dong newspaper reported. Many urban traffic experts threw their support behind the relocation of Vung Tau Airport to Go Gang Island, pointing out that moving the airport from the city center would contribute to the establishment of new urban areas in both parts of Vung Tau. HCMC to launch tender for Thu Thiem 4 Bridge The government of HCMC has asked the Department of Planning and Investment to map out a plan for launching a tender to choose an investor for the Thu Thiem 4 Bridge project, under the public-private partnership format, Tuoi Tre newspaper reported. Meanwhile, the Department of Planning and Architecture was assigned by city vice chairman Vo Van Hoan to work with the Department of Transport, the government of District 7 and consulting firms to ensure an optimized connection between the bridge and the Nguyen Van Linh-Huynh Tan Phat and Tan Thuan 2-Nguyen Van Linh intersections. The department is also in charge of working with consulting firms to complete the selected designs for the bridge, such as the "Vietnamese bamboo" option. The Thu Thiem 4 Bridge, which will connect District 7 and Thu Thiem Peninsula in District 2, is nearly 2.2 kilometers long and 28 meters wide, with six lanes and two pedestrian sidewalks. The cost is estimated at roughly VND5.2 trillion. It is expected to be in service for up to 100 years, with the capacity to handle 7-magnitude earthquakes and vehicles driving across it at a maximum speed of 60 kilometers per hour. The bridge will have an iconic architectural design and become a highlight for the two districts. It will cross the Saigon River and link to the Thu Thiem New Urban Area and is expected to ease traffic congestion between the city center and its southern districts, accelerating the growth of the urban area and the city’s socioeconomic development. Under the city’s plan, five bridges and a tunnel will be built to connect Thu Thiem Urban Area with other parts of the city. Among them, the Thu Thiem 1 Bridge and the Saigon River tunnel have been opened to traffic. Meanwhile, work on Thu Thiem 2 Bridge, requiring almost VND3.1 trillion in investment, began in 2015 but has not been completed due to site clearance obstacles in District 1. HCMC works on plan to build fifth metro line The HCMC Management Authority for Urban Railways (MAUR) has completed a prefeasibility study for the first phase of the city’s fifth metro line project, reported Thanh Nien newspaper. The municipal government in late April asked the HCMC Department of Planning and Investment to coordinate with the relevant agencies to consider the project’s prefeasibility study in the first phase, according to MAUR. The study will be submited to the prime minister for consideration this year before being sent to the National Assembly for approval. The Metro Line No.5 in its first phase will run from Bay Hien Intersection in Tan Binh District to Saigon Bridge, stretching some 8.9 kilometers. It is projected to connect with the city’s other metro lines in the years to come, such as Metro Line No.1 at Saigon Bridge, Metro Line 3b at Hang Xanh Intersection, Metro Line No.4 at Phu Nhuan Intersection, Metro Line 4b at Hoang Van Thu Park and Metro Line No.2 at Bay Hien Intersection. According to the latest data from Transport Engineering Design Inc. based on a study report from Spain-based ICOM consulting firm, the fifth metro line will include a 7.46-kilometer-long underground section and a 1.43-kilometer-long elevated one, with eight stations. The project requires some US$1.66 billion in investment, equivalent to VND38.7 trillion, jointly backed by the Spanish Government, the Asian Development Bank, the European Investment Bank and German development bank KfW. It is scheduled for construction between 2025 and 2029 and is slated for operation in 2030. Also, MAUR is working with the Korea Eximbank and some South Korean investors on the signing of a memorandum of understanding to begin the project’s second phase, under the public-private partnership format. Transport operators oppose toll fee hike proposal Many transport operators have voiced their objections to the Ministry of Transport’s proposal to increase the toll fees for some build-operate-transfer (BOT) road projects, insisting that the fee hike in the current climate is unreasonable. Nguyen Van Quyen, chairman of the Vietnam Automobile Transport Association, stated that as many transport firms are facing difficulties caused by the coronavirus pandemic, it is unfeasible to hike the toll fees at this time. These transport companies have just resumed operations as the pandemic has been brought under control, so the volume of goods and customers remains low, leading to a low frequency of transportation, the local media reported. As such, the Ministry of Transport should carefully consider proposals to raise the fees across multiple BOT road projects during a time of hardship, he remarked. Echoing the view, Khuc Huu Thanh Hai, director of Dat Cang Transportation Trading and Services JSC in Haiphong City, noted that the low frequency of transportation and the decline in customers have affected transport companies heavily, while toll fees for BOT road projects and road maintenance fees are burdening them in addition to the hardships triggered by Covid-19. If the fees are raised to support investors in BOT projects, other firms active in various fields will also be affected heavily, Hai stressed. He added that the fees for BOT road projects account for a large proportion of transport costs, at some 40%. At this time, the State should not raise these fees, he said, suggesting a fee hike when transport operations rebound and the country’s economy recovers fully. Earlier, the Ministry of Transport proposed the Government increase the toll fees for some BOT road projects to help the investors in these projects who have been affected by Covid-19 and reported a sharp drop in revenues. Danang seeks ways to stimulate tourism As localities are stimulating domestic tourism under the recent direction of the prime minister, tourism businesses in the central city of Danang have proposed pricing promotions and updated tourist attractions to solicit guests this summer. This information was unveiled at a meeting on May 12, on ways that tourism businesses and authorities can stimulate tourism in the post-Covid-19 world. The Tourism Department should ask the municipal People’s Council to offer free entry to tourist sites such as Marble Mounts and Champa Museum as well as visa fee exemptions, suggested Cao Tri Dung, chairman of the Danang Tourism Association. “Hotels and resorts should offer large discounts,” stated Dung, who is also the chairman of Vietnam TravelMart Co. “Businesses specializing in travel, accommodation and tourist sites can band together to offer tourism packages to encourage guests to visit over the summer and during the year-end festive season,” he said. Meanwhile, Nguyen Hai Dang, director of Vietravel in Danang City, noted that these groups should organize trips to localities to directly offer their products. “The city should also offer free parking and relax inspections to create favorable conditions for those serving the tourism transportation industry, so they can recover after the Covid-19 crisis,” remarked Ngo Tan Nhi, general director of Vitraco Co. and vice president of the Danang Tourism Transport Society. Meanwhile, Nguyen Duc Quynh, deputy general manager of Furama Resort Danang, proposed that Danang rebrand itself quickly so that sensitive tourism source markets like South Korea will return to normal after the epidemic. At the meeting, Truong Thi Hong Hanh, director of the Danang Tourism Department, reported that her department is planning many programs to help businesses recover as fast as possible. "However, businesses should not be too optimistic. They must always ensure the safety of tourists,” stressed Hanh. Accordingly, the city’s tourism industry will initially focus on attracting tourists from nearby localities as they can easily travel to Danang City. These localities include Quang Tri, Quang Binh, Thua Thien-Hue, Quang Nam and Binh Dinh. Visitors often travel in groups, with families or as couples with their own means of transportation. Leisure packages, including health care, with reasonable prices are suitable for guests who prefer short holidays. In addition, Danang city is cooperating with domestic airlines to serve travelers from localities with direct air links to the city, such as Hanoi, HCMC, Can Tho, Haiphong, Quang Ninh and Gia Lai. The memorandum of understanding between the city's People's Committee and Vietnam Airlines will be applied to run appropriate policies and incentives for passengers on flights from Hanoi and HCMC and on transit flights to Danang. At the same time, the city is coordinating with Viettravel to actively attract local visitors from Hanoi, HCMC and the Mekong Delta region to Danang. Regarding entertainment programs, the Department of Tourism, in coordination with the Department of Industry and Trade and the Danang Tourism Association, will run the "Danang Thank You" program with promotions related to tours, accommodation, dining, shopping, health care, air fare, ground transportation and so on. The city will also organize an overnight town feature in Ngu Hanh Son District, apart from developing community tourism in the Tho Quang-Man Thai area and at Nam O Beach. Nguyen Thi Hoai An, deputy director of the Danang Tourism Promotion Center, added that the city’s tourism industry plans to invite KOLs to join these stimulation programs. Danang will also have its own song to promote tourism. Viet Valley Ventures to invest in three local startups Newly founded venture capital firm Viet Valley Ventures has announced its investments in three Vietnamese technology startups. Under agreements signed on May 12, JobsGo JSC, Vietnam Windsoft Technology Company (Windsoft) and Ecommerce Easy Company (EcomEasy) will receive US$200,000-US$500,000 in funding each. The specific investment amount remains unknown. Aside from providing financial investment, the company will offer consultancy services on development orientations to these startups. Nguyen Khanh Trinh, managing director of Viet Valley Ventures, told the Saigon Times that the three startups’ operations are associated with technology. They hold potential for further growth, have a low cash burn rate and are expected to earn immediate profits. The venture capital company made a thorough analysis before deciding to back these startups, he added. Viet Valley Ventures was founded last year by senior tech executives working in Silicon Valley with an initial investment of US$3 million and seeks to offer financial and tech support to local startups. Among the three startups, JobsGo is a mobile recruitment platform established in Vietnam in 2018 with one million users to date. It has attracted 20,000 recruiters and recorded three million job applications. WindSoft specializes in providing software solutions and mobile applications to help businesses with management and digital transformation to increase sales and enhance customers’ experiences. EcomEasy offers ecommerce marketing and sales solutions to companies. It currently runs four offices in Vietnam, Thailand and Singapore. Vietnam’s economic growth will rebound strongly in 2021: IMF The International Monetary Fund (IMF) has forecast that Vietnam’s economic growth will slow to 2.7% this year due to the coronavirus pandemic but may rebound strongly to 7% next year. According to IMF representative in Vietnam Francois Painchaud, the country’s strict measures to contain the coronavirus, the global recession and weak domestic demand are elements that will slow its economic growth this year from an average of roughly 7% in 2018 and 2019. However, Painchaud noted that growth is expected to recover as preventive measures are lifted, reaching 7% in 2021, supported by monetary and fiscal easing, the country’s relatively strong macroeconomic fundamentals and a gradual recovery in external demand. Speaking at a meeting of the government last week, Prime Minister Nguyen Xuan Phuc said the Vietnamese Government is determined to achieve an economic growth rate this year higher than the IMF’s estimate of 2.7%, possibly over 5%. Standard Chartered earlier lowered Vietnam’s economic growth forecast in 2020 to 3.3%. The bank forecast that growth would rebound to 6.5% in 2021 given an expected recovery in demand. Meanwhile, the Asian Development Bank predicted that the coronavirus pandemic could drop Vietnam’s growth to 4.8% this year, but the country would remain one of the fastest growing economies in Asia. Long An converts 200 hectares of forestland for solar power projects The Long An government has approved the conversion of over 223 hectares of forestland, with some 200 hectares being earmarked for the development of solar power projects. The provincial government on May 12 noted that it will allow the conversion for solar power projects in Binh Hoa Nam Commune in Duc Hue District. Specifically, the provincial government allowed Hoan Cau L.A Co., Ltd, to convert over 47.4 hectares of forestland to develop Solar Park 01 and permitted Vietnam Solar JSC to build Solar Park 02 on 48.7 hectares of forestland set for conversion. Meanwhile, Long An Solar Park Corporation and Solar ENERGY LA JSC were allowed to convert over 48.3 hectares and 48.4 hectares of forestland for the construction of Solar Parks 03 and 04, respectively. Apart from these four firms, other enterprises seeking to invest in residential areas, gas and oil and seafood farming were also permitted to convert forestland for their purposes. Under the decision, the firms allowed to convert forestland must plant new forests in compensation for the forestland lost, or make payments to plant forests and fulfill all relevant financial obligations in line with prevailing regulations. However, due to the lack of land for planting new forests, most of these firms have offered to make payments, the local media reported. Data from the Long An Department of Agriculture and Rural Development indicated that Long An Province has over 22,600 hectares of forestland, with 21,000 hectares of plantation forests and over 800 hectares of natural forests. Over 18,000 HCMC-based household businesses stop operations The coronavirus pandemic has put a crimp on household businesses in HCMC, forcing over 18,620 of them out of business over the first four months of this year. Tax collections from household businesses have plunged due to the impact of Covid-19, the disease caused by the coronavirus, according to the HCMC Tax Department. Between January and April, the number of household businesses registering for suspension owing to the pandemic accounted for 7.5% of the city’s total operational ones. The city’s tax department has offered an exemption from tax payments of VND12.7 billion each month to these suspended household businesses, the local media reported. Apart from this, as a series of individual and household businesses suspended their operations following the prime minister’s Directive 15, tax collection revenue from these businesses dropped by an additional VND82.8 billion in April. As for enterprises active in the city, the first four months of 2020 saw over 1,520 firms register for dissolution, soaring by 54.8% year-on-year. Meanwhile, the city attracted a mere US$1.05 billion in foreign investment, dipping by 33% against the year-ago period. The HCMC Tax Department noted that stagnant business activities due to the social distancing measures to prevent the spread of Covid-19 drove the total tax revenue in the four-month period down by 7.9% year-on-year. The total revenue met only 30% of the target. In January-April, the city witnessed revenue from multiple types of taxes tumble. Corporate income tax revenue, for example, fell by 11.08% year-on-year, while the revenue from value added taxes inched down by 6.3%. Industrial zone developers reap profits despite pandemic While many businesses in various fields have been hit hard by the coronavirus pandemic, industrial zone developers in Vietnam have been flourishing. This sector is expected to maintain its growth as the country is seen as an attractive investment destination, especially after the Covid-19 crisis is over. Sonadezi Corporation, which has a long history in the investment, development and trade of industrial park infrastructure in Vietnam, recently announced that its net revenue in the first quarter of the year expanded nearly 11% to over VND1 trillion and net profit inched up a staggering 42% to over VND150 billion over the same period last year. Of these, Sonadezi’s revenue from industrial zone services rose by 66% to VND293 billion. Its after-tax profit totaled some VND271 billion, up 51% versus the year-ago figure, mainly thanks to the lease of Chau Duc Industrial Park. Overall, Sonadezi wrapped up the first quarter reaching 30% of its 2020 profit target. Nam Tan Uyen Joint Stock Corporation, another industrial zone developer, recorded its Q1 net revenue jumping by 6.4% to exceed VND41 billion, with sales generated from real estate trade activities reaching VND31 billion. Long Hau JSC (LHG) also reported growth in revenue and profit in Q1, with net sales edging up some 19% to VND206 billion and gross profit surging over 20% to more than VND93 billion against the 2019 figures. LHG’s revenue from offering land lots for lease to develop infrastructure rose 21% to VND159 billion, contributing 77% of the developer’s total revenue. The firm posted a 22% increase in revenue obtained by leasing industrial parks and residential areas, at nearly VND21 billion. Other developers in the field including Phuoc Hoa Rubber JSC and Tan Tao Investment and Industry Corporation also saw their profits rising drastically. Given the disruptions in the global supply chain caused by Covid-19, experts forecast that many firms may gradually move their factories out of China to reduce their reliance on this country. Vietnam, among other Southeast Asian nations, holds great potential to become a safe investment destination in the years to come, especially as it has been praised for its success in combating Covid-19. Vietnamese tra fish exports to China, U.S., EU to fare well: officials China, the United States and the European Union are likely to remain the main consumers of Vietnam’s tra fish (pangasius) products for the next five years, making up a staggering 65% of the Southeast Asian country’s total exports, stated officials. Despite many fluctuations, the three markets remain sustainable in terms of the volumes and revenues of Vietnamese tra fish exports, according to Truong Dinh Hoe, general secretary of the Vietnam Association of Seafood Exporters and Producers (VASEP). China, the United States and the European Union have long been among the top three buyers of Vietnamese tra fish products based on earnings, remarked Hoe. He added that local tra fish producers have been able to satisfy more stringent requirements for food quality and safety for the three markets. The recognition of the Vietnamese tra fish industry’s equivalence by the U.S. Department of Agriculture is evidence that Vietnam meets U.S. standards, he pointed out. Also, the long-awaited free trade agreement between Vietnam and the European Union, better known as EVFTA, which will soon go into effect, will put Vietnamese tra fish at a distinct advantage on the European market over the next five years, noted the official. The tariff on Vietnam’s frozen tra fish fillet shipments to the European Union will fall to zero from the current 5.5% in the next three years, stated Tran Dinh Luan, head of the Vietnam Directorate of Fisheries, at a conference in the southern province of An Giang last week. Luan said it will take some seven years for Vietnam’s processed tra fish fillet products to have their export tariffs lowered to zero from the current 7%. The trade pact serves as a catalyst for growth, which will open up ample opportunity for Vietnamese tra fish processors to establish a foothold in the European market of some 508 million people with a gross domestic product value of roughly US$18 trillion, he added. The Association of Southeast Asian Nations (ASEAN) is also poised to be a promising market for Vietnamese tra fish products until 2025, according to VASEP General Secretary Hoe. He explained that the 2018-2019 period had seen positive growth in tra fish exports to the ASEAN, with 2018 surging by 41.5% from a year earlier to reach US$202.6 million. Last year saw a slight decline of 3.6%, but the ASEAN market still ranked fourth, at US$195.4 million, behind China, the United States and the European Union. Brazil and Middle Eastern countries are predicted to be major consumers of Vietnamese tra fish in the years to come as well. However, technical bottlenecks and barriers need to be resolved. For example, Brazil is a potential market for Vietnam’s tra fish exporters to South America, but the past two years saw declines in earnings. Brazil expects Vietnam to open its doors for its agricultural products, such as beef and cantaloupe, according to the official. He pointed out that Brazilian authorities have thus set higher technical barriers for Vietnamese exporters compared with those from the United States and the European Union to slow down the growth of Vietnamese tra fish products. “Brazil only accepts tra fish products without any additives,” noted Hoe. He explained that this requirement alone has already hurt Vietnamese tra fish processors as it drives up the prices of their finished products, making it harder to attract customers. VNN |
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Vietnam continues repatriating citizens from EU, US02:33Vietnam brought citizens home from Germany, Spain, Switzerland, and the US - the world's hotspots of coronavirus outbreaks.National flag carrier Vietnam Airlines on May 16 brought home more than 540 Vietnamese nationals on two repatriation flights from Europe and the US, continuing the country’s efforts to repatriate its stranded citizens.
Passengers include people of special cases who are children under 18, the elderly, the sick, people with chronic diseases, pregnant women, stranded tourists, workers of expired labor contracts, state employees in mission, and students who finished school, according to Vietnam Airlines.
Flight VN8 from Frankfurt (Germany) to Danang (Vietnam) with stopover at Madrid (Spain) brought about nearly 200 passengers from Germany, Switzerland, and Spain, the hotspots of coronavirus outbreaks in Europe. This was Vietnam Airlines’ first direct flight from Spain to Vietnam. On way from Hanoi to Frankfurt, Vietnam Airlines repatriated nearly 250 Germany nationals and brought medical supplies as Vietnamese pandemic relief to German people.
Another flight on the day is from Washington DC to Noi Bai, Hanoi. It was Vietnam Airlines’ second flight to repatriate Vietnamese citizens from the US after the first one from San Francisco on May 8. The return flight between Hanoi and Washington DC with a stopover in Alaska on way back took nearly 40 hours. Vietnam Airlines has used Alaska twice as a fuel stop. En route to Washington DC, the fight carried a number of passengers and medical supplies donated to American people.
Vietnam Airlines used Boeing 787-9 Dreamliner and Boeing 787-10 Dreamliner for flights to Europe and the US, respectively. American netizens published a video featuring a Vietnam Airlines 787-10 landing in Ted Stevens Anchorage International Airport, Alaska after flying from Washington DC. The plane then continued back to Hanoi. Hanoitimes VNN/Linh Pham |
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BUSINESS NEWS HEADLINES MAY 2202:00Casinos still lack popularity in Vietnam Even though casinos have been legalised in Vietnam, they still are failing to attract investment and visitors. In early 2017, Government Resolution 3 legalised casino business in Vietnam along with regulations and fines for violations. The PM also approved the pilot plan allowing Vietnamese to enter casinos. Nguyen Mai, Chairman of the Vietnam Association of Foreign Invested Enterprises said casinos were now operational in 43 hotels and resorts in Vietnam. The sector has had rapid growth and doubled in size since 2017. However, Mai said the socio-economic effects were still much lower than expected. "Because this is a sensitive business so there's a lack of agreement about attracting foreign investment. We haven't been able to access or be in sync with international practices to adjust regulations over this business," Mai said. With a population of nearly 100 million people and a growing middle class, Vietnam is a potential market for casinos. According to the firms, many people who earn from VND10m (USD426) to VND20m a month are willing to spend VND1m to VND3m on gambling. Vietnamese people spend about USD3bn a year on buying lotto tickets, USD1bn on gaming and USD1bn on gambling overseas. Vietnam also attracts millions of visitors thanks to the beautiful scenery and some want to spend money in casinos. According to Mai, the casino business is managed by the Ministry of Finance but due to lack of personnel, evaluating and issuing business permits have been slow. "We need to revise and further complete the legal framework by learning from other countries. It will encourage foreign as well as Vietnamese individuals and organisations to invest in casinos and attract more tourists," Mai said. "We can learn from Singapore and set up a national council on gambling or allow city and provincial authorities to issue permits and manage the casinos as Australia does." He went on to say that a national council on gambling problems is more suitable for Vietnam. The deputy prime minister can be the council's chairman and the members will be representatives of various ministries and associations. This council will consult the prime minister on legal frameworks and management process in order to prevent any possible problems. Meeting talks easing difficulties for PetroVietnam, Vietnam Airlines Prime Minister Nguyen Xuan Phuc on May 21 chaired a meeting with permanent Government members to discuss measures to tackle difficulties faced by the Vietnam Oil and Gas Group (PetroVietnam) and the national flag carrier Vietnam Airlines. Speaking at the event, PM Phuc said he recently attended online and offline meetings with business community and the Government has issued a resolution to remove obstacles for them. He hailed PetroVietnam and Vietnam Airlines for proactively designing plans to overcome challenges and maintain operations. The Government leader shared the difficulties faced by the two corporations and stressed that there are many opportunities ahead. He suggested they continue with internal restructuring, including market and labour restructuring, saving costs, further improving operation efficiency, and maintaining key workforce. Ministries and agencies were also asked to join hands to remove difficulties for PetroVietnam and Vietnam Airlines. The PM also gave opinions on proposals by the two groups at the working session./. Hanoi welcomes RoK investors Hanoi welcomes more investors from the Republic of Korea (RoK), Secretary of the municipal Party Committee Vuong Dinh Hue said and invited RoK businesses to participate in an investment promotion forum hosted by the city in June. When receiving RoK Ambassador to Vietnam Park Noh-wan on May 21, Hue affirmed that Hanoi has basically put the COVID-19 pandemic under control, which is the outcome of joint efforts between the Government and people, including Koreans living in Hanoi. The city is working on the dual tasks of preventing the disease and taking economic development measures at the same time, he stated, adding that it aims to maintain a growth pace 1.3 times higher than Vietnam’s average growth rate. The city leader also asked the Ambassador to coordinate in restoring the supply chain for Vietnamese businesses and Korean businesses operating in Vietnam. Ambassador Park thanked the city leader’s directions and attention to ensure safety for Koreans living in Hanoi and help Korean enterprises maintain their operations./. Danang launches appealing promotions to lure domestic visitors The central city of Danang has offered very attractive promotional programmes to entice domestic tourists while international flights remain suspended due to Covid-19. Since early this month, Mai Linh Tourism Company in Danang has started receiving the first travellers after a long closure due to the pandemic. Nguyen Viet Trai, director of the firm, said that international flights were still banned, so Vietnam would have to focus on domestic tourists. Before Covid-19, the company’s major customers were Taiwanese. Hai Van Cat International Travel Company, which specialises in providing tours for visitors from China, Hong Kong and South Korea, has turned to servicing domestic tourists. The company has offered a 40% discount for a three-day and two-night package. A range of three and four-star hotels in Danang have sharply cut their room tariffs. Before Covid-19, some four local four-star hotels charged more than VND3 million (USD130,434), but now the figure has fallen to just less than VND1 million. It is quite easy for tourists to find rooms priced at around VND500,000 in Danang at this time. Most of the hotels do not require deposits and offer free breakfast. According to Nguyen Xuan Binh, deputy director of Danang’s Department of Tourism, the top priority for the local tourism sector is drawing domestic visitors, particularly from the key markets of Hanoi and HCM City. In the first four months of this year, Danang welcomed roughly one million visitors, down 58% on-year. International tourists saw a drop of 50%. Businesses respond to Quang Ninh’s tourism promotion campaign Major businesses such as Vingroup and Sungroup have launched various summer discount programmes in response to the tourism promotion campaign of the north-eastern province of Quang Ninh in 2020. From May 16, Vingroup, a real estate giant in Vietnam, offers seven preferential packages for vacationers, including free return air tickets and free entrance into Vinwonders and Vinpearl Safari parks for those who book rooms for two nights or more at resort areas of Vinpearl Nha Trang, Phu Quoc, and Da Nang-Hoi An. Meanwhile, Sungroup - one of the largest real estate developers in Vietnam, will provide a free programme worth VND290,000 per passenger when they visit Ha Long Bay through Ha Long International Cruise Port. On May 14, the provincial People’s Council approved a tourism stimulus package worth VND200 billion (US$8.5 million) with the aim of attracting more visitors at home and abroad. Under the incentive, starting from May 15, ticket fees will be exempted for all visitors, both Vietnamese and foreigners, to Ha Long Bay, Quang Ninh Museum and the complex of Yen Tu monuments and landscape until the end of the month and upcoming holidays. In addition, passengers going through Van Don International Airport will receive free round-trip bus rides to Ha Long and Uong Bi cities until the year's end. Quang Ninh is endowed with natural advantages for sea and island tourism. It has a coastline of more than 250 kilometres and more than 2,000 islands and islets which account for two-thirds of the total number in Vietnam. It is home to popular destinations such as Ha Long Bay, Bai Tu Long, Ha Long Bay National Park and some islands. In particular, Ha Long Bay was twice recognised as a World Natural Heritage site by UNESCO in 1994 and 2000. The bay spans 1,553 square kilometres and includes 1,969 islands of various sizes. It features thousands of limestone karsts and islets in various shapes and sizes. The limestone in the bay has gone through 500 million years of formation in different conditions and environments. Quang Ninh welcomed only 1.54 million holidaymakers in the first four months of 2020, a year-on-year decline of 77%, due to COVID-19. Decisive reforms needed for Vietnam to get full EVFTA benefits: WB Vietnam needs to fill major legal gaps and address key implementation issues to reap the full benefits of the European Union Vietnam Free Trade Agreement (EVFTA) to be ratified by Vietnam’s National Assembly in May, according to a new World Bank report. The report, “Deepening International Integration and Implementing the EVFTA”, released on May 19, estimates that by simply enjoying the tariff reduction as agreed, EVFTA could boost Vietnam’s GDP and exports by 2.4% and 12% respectively by 2030, while lifting an additional 100,000-800,000 people out of poverty by 2030. Such benefits are particularly urgent to lock in positive economic gains as the country responds to the COVID-19 pandemic. The report argues that Vietnam could benefit even more from the next-generation trade deals such as EVFTA and Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) if it stimulates a comprehensive agenda of economic and institutional reforms to facilitate compliance with non-tariff agreements. The report estimates that such reforms would result in a “productivity kick”, increasing GDP by 6.8%, relative to the baseline scenario, by 2030. It highlights the need for Vietnam to increase capacity to handle certain key issues, including rules of origin, animal and plant sanitary standards, and investor-state dispute settlement. “If Vietnam can act in a decisive manner to close legal and implementation capacity gaps, it can capitalize a trade deal whose direct benefits are estimated to be largest in the country’s history,” said Ousmane Dione, World Bank Country Director for Vietnam. “With COVID-19 acting as a reset button and EVFTA as an accelerator, now is the perfect time to embrace deeper domestic reforms”, Ousmane noted. The report cites the rules of origin requirement as one of the key challenges for Vietnam to overcome. Even if a product is produced in Vietnam, EU importers might not determine it as such due to the high dependence on imported materials. The report finds that in key export manufacturing industries, a majority of inputs are sourced from foreign countries (for instance, 62% in electronics and 53% in the automotive sector). It calls for greater efforts to improve linkages between domestic suppliers and foreign enterprises as lead firms in major global value chains. At the same time, rigorous European food safety standards make it imperative for Vietnam to improve the clarity and consistency of its sanitary measures. By one estimate, the cost of full compliance with existing non-tariff measures in Vietnam will be equivalent to a 16.6% tariff (compared to a regional average of 5.4%). The introduction of EVFTA is expected to bring more investors into Vietnam both from Europe and the rest of the world. As the flow of foreign investment increase, so does the number of commercial grievances. The report calls for accelerated development of a Systemic Investment Response Mechanism to settle disputes between investors and the state. The report also makes the case for prioritizing key sectors that make up the bulk of Vietnamese exports to the European market for COVID-19 economic recovery efforts, to maximize the benefits of the trade deal. Import turnover climbs to over US$78 billion during four-month period The opening four months of the year have seen the nation’s total import turnover rise to over US$78 billion, a drop of 0.3%, with China maintaining its place as the country’s largest import market, according to figures released by the General Department of Customs. Elsewhere, in terms of turnover scale, Asia represents the largest trading market for the nation. Throughout the reviewed period Vietnamese trade with the Asian market reached US$103.61 billion. Despite suffering a slight annual decrease of 0.4%, the continent accounted for 65.2% of overall import and export turnover for the country. Most notably, although declines occurred in the majority of major markets, Asia still maintains 80.1% of the nation’s total import turnover. With a general decline occurring across the board, several import groups recorded slow or negative growth. The only commodity group to enjoy increases over the four-month period were computers along with electronic products and components. Indeed, these items represent the nation’s largest import group of the reviewed period. Since the start of the year, imports of computers, electronic products and components reached approximately US$17.6 billion, representing a 11.5% increase on-year. In particular, FDI enterprises spent a total of US$14.7 billion during the period, equivalent to 84% of the total import value of computers, electronic products and components, an increase of 11.7% from last year. The Republic of Korea remains the largest consumer of Vietnamese computers, electronic products and components with a value of US$5.44 billion, a drop of 6.1%, followed by China, Taiwan (China), and the United States. Other import items which recorded remarkable growth include crude oil, in addition to telephones and components. Despite a number of items recording growth, the General Department of Customs noted that several key import groups endured a decrease in turnover of up to hundreds of millions of dollars during the reviewed period. The commodity group that suffered the largest fall in turnover was petroleum, with a total import volume of 2.4 million tonnes over the four-month period, a sharp decline of 41.7%, equivalent to US$800 million, in comparison with last year’s same period. Completely built-up automobiles, along with iron and steel, also recorded sharp drops, with falls of US$430 million and US$290 million, respectively. Indeed, the commodity groups which suffered the biggest drops in import turnover are those that make major contributions to the customs sector’s revenue. Fresh injection of foreign investment set for local property sector Despite unpredictable developments relating to the novel coronavirus (COVID-19) epidemic, the domestic real estate market is anticipated to attract a fresh wave of foreign investment due to its high-growth potential, reasonable prices, and relative safety as an investment destination, according to insiders. Experts believe that there are indications that current real estate prices are beginning to bottom out, with prices predicted to increase gradually in the near future, therefore providing an unique opportunity for foreign investors. The past 40 years have seen local house prices experience an upward trajectory with statistics of research units indicating that over the past 16 years, the real estate prices in Hoan Kiem district of Hanoi and in District 1 of Ho Chi Minh city have undergone a 27-fold increase and a 22-fold rise, respectively. In comparison, gold prices over the same period have only increased by just over five times. Most notably, real estate prices in hotspots such as in Duong Dong town close to the night market of Phu Quoc island have enjoyed a surge of up to 300% over the course of the past two years. These rising prices nationwide can be attributed to the historic trends of Vietnamese people moving to hoard assets, with the savings rate of local people reaching nearly 50% of their income, double the figure seen in other nations. Statistics show that even during the peak of the COVID-19 outbreak, investors continued to seek out real estate in areas close to ongoing projects such as transport infrastructure, largely due to their clear legal regulations, reputable investors, and high profitability in the future. Indeed, foreign investors have also shown their keen interest in the nation’s real estate market. Dr. Su Ngoc Khuong, Senior Director at Savills Vietnam , said that since 2019, a number of projects worth over US$500 million in both Hanoi and Ho Chi Minh City are in the process of negotiating transactions which are expected to occur in the third quarter of this year. The majority of notable foreign investors keen on these projects come from Japan, the Republic of Korea, Hong Kong (China), Singapore, and a number of European nations. The Vietnamese real estate market is projected to become a magnet which attracts billions of dollars’ worth of foreign investment capital in the near future, according to real estate experts. Domestic market offers solution for businesses following COVID-19 pandemic The domestic market is poised to play an important role in getting the nation’s socio-economic development back on track following the easing of the novel coronavirus (COVID-19) pandemic, with local firms needing to pay close attention to developing trends due to the ongoing economic impact caused by the virus. The country’s economy has been experiencing a difficult and challenging period since the first COVID-19 outbreak was detected. Indeed, the past three months have seen the majority of the production and business sectors encounter plenty of difficulties caused by the negative impact of the epidemic. This has resulted in both exports and domestic consumption enduring a slowdown with a number of items having an excess supply, leading to losses or an overall decrease in profits. As a result, a number of enterprises have been unable to survive and have either suspended operations or gone bankrupt. According to figures released by the General Statistics Office, the first four months of the year saw the number of companies ceasing operations or facing bankruptcy higher than the rate of newly-established firms. Most notably, in domestic trade many stores were either forced to close, open at reduced hours for a long period of time, or completely halt operations. Due to the recent economic downturn sales at many supermarkets, shopping centres, and stores have suffered a sharp fall. The latest report by the Ministry of Industry and Trade indicates that total retail sales of goods and social consumer services for the entire country over the past four months has dropped by 4.27% in comparison to last year’s figures. This represents an unprecedented decline in revenue within the domestic market, the most potential and important feature of the national economy. Facing up to the consequences of the COVID-19 pandemic, Vu Vinh Phu, former Chairman of the Hanoi Supermarket Association, believes that in order to achieve greater global market penetration, it is essential for domestic businesses to place a major focus on developing the domestic market. If problems occur within the distribution system along with links between production and distribution, then companies will face serious hurdles, especially in the context of the ongoing spread of the COVID-19 globally. Phu suggests that ministries, sectors, and localities should continue to improve the local business environment by making it more public and transparent, whilst simultaneously taking on monopolies occurring in sectors, the hoarding of goods, speculation, transfer pricing, and tax evasion. “Enterprises need to continue building a strong domestic retail brand, bolster confidence of buyers and sellers in a long-term and sustainable manner. That is a firm foundation for the fast and effective development of each business organisation and individual in the market,” he added. Vu Tien Loc, Chairman of Vietnam Chamber of Commerce and Industry (VCCI), stated that the market represents a vital issue for Vietnamese enterprises. In the context of the country’s deeper integration into the global economy following the signing and implementation of dozens of free trade agreements, this is seen as opportunities for local firms to gain a greater foothold within the global market. As a means of enjoying a level playing field, with many opportunities coming alongside challenges and tough competitors, ways in which to secure a firm foothold within the domestic market looks to be an issue of major importance. According to economic experts, the domestic market’s increasing demand over recent years and ahead in the future means its development will promote the production of Vietnamese goods in a strong and highly competitive fashion, therefore serving domestic consumption and exports. As a result, the domestic market will play an important role in the nation’s socio-economic development throughout 2020 and in subsequent years. Vietnam, a safe post COVID-19 investment destination Vietnam has effectively controlled the spread of the COVID-19 epidemic and maintained a safe environment for production and trade. With many natural advantages, the country is a promising place for foreign investors to expand their supply chains. International media has praised Vietnam’s effective COVID-19 response. Economists say Vietnam’s small number of COVID-19 infections and no deaths will enable it to recover the economy before most other countries. Frederick Burke, Managing Partner of the international law firm Baker McKenzie, says Vietnam’s response to the epidemic has made foreign enterprises feel safer doing business in Vietnam. Michael Sieburg, a partner at Asia-focused consultancy firm YCP Solidiance, reveals there is a sense in many of his discussions that Vietnam, relative to many other countries, will move on the investors’ radar. A representative of the Kizuna Joint Development Corp, which builds factories in Vietnam, says given its fast response to the virus, they expect foreign investment to pour into Vietnam after the pandemic. The company is speeding up plans to finish a 100,000-square-metre factory in southern Vietnam in July in anticipation of an increase in post-pandemic demand. Before the epidemic, many businesses with factories in China had eyed Vietnam and other ASEAN countries. Nguyen Anh Van, an official of the Van Trung 2 Industrial Park in Bac Giang province, says they have heard from a growing number of foreign investors wishing to invest in the industrial park. “The first thing foreign investors ask about is the provincial investment policies, whether they’re favorable or not. The second matter of their concern is the location and infrastructure of the industrial park. Third, they want to know about labour quality and availability,” Van explains. Successful containment of the COVID-19 epidemic has confirmed Vietnam’s ability to ensure a stable, safe environment. Nikkei Asian Review reports shifting of investment is inevitable after the COVID-19 pandemic and ASEAN countries like Vietnam will be favored destinations. The IMF’s World Economic Outlook report for 2020 agrees Vietnam has the best growth prospect in ASEAN. Meanwhile, the World Bank concludes Vietnam’s economy was resilient to external shocks in the first few months of this year and its economy will rebound. Director of the American Chamber of Commerce Adam Sitkoff says Vietnam is a lucrative investment destination in Asia. According to Hirai Shinji, Chief Representative of Japan’s External Trade Organization in Ho Chi Minh City, Vietnam has successfully contained the epidemic and will now receive more foreign direct investment. ChosunBiz, an economic newspaper published by the Republic of Korea’s Chosun Group, points out that the Vietnamese government’s determination to fight the epidemic received strong support from foreign investors. It gives as example Samsung’s closure of factories elsewhere in the world, but not in Vietnam. Bloomberg predicts the Vietnamese economy will bounce back because Vietnam is a favored destination for foreign investors. It says US$12 billion was registered in Vietnam in the first four months of this year. The Vietnamese government has set a GDP growth target of 5%. Fitch Ratings has kept the outlook for Vietnam at “stable” as they expect a strong recovery in 2021, with growth forecast at 7.3%. Higher workforce quality needed to seize on EVFTA opportunities Whilst the EU-Vietnam Free Trade Agreement (EVFTA) is anticipated to offer a wealth of opportunities through an expansion of export markets and greater job creation, the quality of human resources must improve in order to meet stringent requirements regarding the overall quality of goods and services, insiders state. According to a study conducted by the Ministry of Planning and Investment, the EVFTA is poised to create an additional 146,000 jobs each year, with the majority focusing on labour-intensive industries that enjoy high export rates to the EU, including garment and textiles, leather and footwear, and aviation transport. The Multilateral Trade Assistance Project (MUTRAP) believes that aside from increased job opportunities, Vietnamese workers will be granted the chance to play a part in a wider job market and enjoy ways in which to improve their skills. Despite these benefits, the MUTRAP recommends that the EU enforce stringent requirements based on product quality and production processes, which in itself will impose pressure with regard to labour competition on local enterprises as they seek higher-quality human resources as a means of meeting strict requirements. Most notably, challenges in terms of high quality and skilled human resources remain a thorny issue for both domestic firms and foreign-invested businesses in the country. Luu Thi Thu Huyen, CEO of Blue Sea, says the company plans to approach a number of markets within the EU as soon as the novel coronavirus pandemic subsides, noting that the workforce should be carefully chosen to ensure that strict standards set forth by the EU in relation to product quality and human resources are met. With regard to labour issues, Takeo Nakajima, the Chief Representative of the Japan External Trade Organization Office (JETRO) in Hanoi, says that plenty of Japanese enterprises continue to appreciate the attractive investment environment in Vietnam. At present, up to 54% of Japanese firms are taking advantage of free trade agreements (FTAs) signed by Vietnam. He notes that Japanese investors are to turn their attentions to areas such as export processing, retail, technology, construction, healthcare, and tourism to take advantage of the market from FTAs, especially the EVFTA, in the near future. Despite this, Nakajima remains concerned about labour costs and the recruitment of personnel while investing in the country. Indeed, several Japanese businesses forecast that the current job market will make it harder to recruit workers than in previous years, which is considered to be one of the investment risks in Vietnam. As such, many Japanese enterprises believe that resolving the problem of human resources remains one of the most important factors to consider when deciding on whether or not to continue expanding production and business activities in Vietnam, Nakajima said. As a way of improving the quality of human resource and seizing on the opportunities brought about by the EVFTA, a number of schools under the Ministry of Industry and Trade have been actively investing in training, teaching, and providing human resources to adapt to the new situation. This is being done alongside efforts to strengthen connectivity with other firms, including large corporations such as Toyota, Samsung, and Canon. A representative from Red Star University emphasises the importance of co-operating with enterprises in training activities due to the potential for the skills of students to be greatly improved in order to meet relevant job requirements set by companies. Bamboo Airways to go public on stock market in Q4 Bamboo Airways is expected to be listed on the Ho Chi Minh City Stock Exchange ahead in the fourth quarter of the year, with the firm aiming to double its number of domestic routes in addition to restarting its air routes to the United States by the end of 2021 or in early 2022. The move comes after the airline’s original plan to be listed as a public company was postponed due to the effects of the novel coronavirus (COVID-19) which hit during the second quarter of the year. Currently, Bamboo Airways is planning to purchase 60 engines worth US$2 billion from the General Electric Group of the United States for its Boeing 787-9 Dreamliner wide-body fleet. The firm will also continue to expand its operation once the COVID-19 has been fully brought under control locally, according to Trinh Van Quyet, CEO of Bamboo Airways. In addition, the airline is poised to hire more aircraft over the course of the year as it seeks to expand operations. Indeed, the airline is currently operating between 45 and 50 domestic flights each day, with this figure expected to increase to over 100 flights per day by early June, which is equivalent to 80% of its flights in the pre-epidemic period. Despite suffering revenue losses of more than VND 1,500 billion during the first quarter, the airline plans to double its number of domestic and international routes to 60 and 25, respectively, by the end of the year. Noting that Vietnam is one of the global aviation markets that are recovering well post COVID-19, Bamboo Airways CEO Quyet said air passengers feel secure after the COVID-19 epidemic has been brought under control. “Domestic tourism is expected to enjoy robust growth in the near future due to the country’s ban on international commercial flights,” said the CEO, citing statistics that domestic airlines served 55 million passengers last year, an annual rise of 11%. Over 1,000 projects to call for investment at 2nd Industrial Real Estate Forum More than 1,000 projects will call for investment at the second Vietnam Industrial Real Estate Forum scheduled for June 19 in Hanoi. The forum will be jointly held by the Vietnam National Real Estate Association, the Central Institute for Economic Management and the Entrepreneur Magazine under the theme of “Golden Opportunities in New Era”. It is expected to share information and put forward solutions helping investors grasp golden opportunities of Vietnam’s industrial real estate market in the 2020-2022 period. The forum will also act as a venue connecting State management agencies, local People’s Committees, Management Boards of Economic and Industrial Zones, international organisations, FDI firms, banks, financial institutions, and investors. Although the property market is facing a lot of difficulties caused by the COVID-19 pandemic, the industrial real estate is assessed to be a potential and attractive segment for investors. According to a report of the Economic Zone Management Department under the Ministry of Planning and Investment, by the end of March 2020, Vietnam had 335 industrial zones, with 260 put into operation and 75 being constructed./. Labour market sees positive signs of growth Experts have predicted the labour market will improve in the near future based on a series of upbeat signals. According to the Ministry of Labour, Invalids and Social Affairs, between 70,000 and 80,000 workers who had previously lost their jobs will rejoin the workforce every month from May. Statistics from the Hanoi Centre for Employment Services (HCES) showed that from February to April this year, 1,945 firms registered to recruit for 13,562 positions. Most of the jobs offered were in production, mechanical engineering, manufacturing and garment making. Ta Van Thao, director of the centre, said the demand for new workers is mostly coming from small- and medium-sized enterprises. He added that once the COVID-19 pandemic is under control it will lead to a more positive economic outlook and increased demand in the labour market. Vietnamworks, a popular website for online human resources and recruiting services in Vietnam, has carried out a post-COVID-19-social-distancing survey of 400 companies and 3,400 job seekers. Accordingly, up to 25 percent of firms questioned said they would soon restart their recruitment efforts and 14 percent said they had already resumed. Vietnamworks said despite a 20-percent growth in the number of jobs offered in the first week of May, a supply-demand balance is yet to be achieved thus competition is higher than ever. Vietnam has gone 34 straight days without any new COVID-19 infection cases in the community, according to the National Steering Committee for COVID-19 Prevention and Control. As of May 20 morning, the total infections in the country remained at 324, including 184 imported cases that were quarantined upon their arrival. More than 80 percent of the patients have recovered, and zero deaths have been reported, said the committee’s treatment subcommittee./. Thailand to build desalination plant to serve industrial production The Industrial Estate Authority of Thailand (IEAT) is planning to invest in a water desalination plant to supply the Eastern Economic Corridor (EEC) in response to ongoing and future droughts. The plant, capable of desalinating 300,000 cubic metres of seawater per day, will be set up through a joint venture. It will supply water to factories in the area that has had to reduce water consumption in the past year due to extreme drought. The EEC covers three provinces – Rayong, Chon Buri and Chachoengsao, with 34 industrial estates and 6,033 factories. It is an ambitious project of the Thai Government to stimulate the local economy. IEAT governor Somchint Pilouk said Thailand has been hit hard by what may be its worst drought in four decades, which has increased the risk of water shortages for industries in the country’s central and eastern localities and agriculture in the North and Northeast. She said the desalination plant will solve the water shortage in the long term and guarantee the eastern areas will not face future shortages. IEAT expects to finalise the investment budget and joint venture partnership for the project in the next few months. The plant uses reverse osmosis to convert seawater to freshwater, removing salt and other minerals. Its capacity can be expanded if demand grows in the future, said Somchint. IEAT began a feasibility study in March to determine the viability of using desalinated water to solve water shortages for the industrial sector. /. Australia to impose new regulations on prawn imports Prawn and uncooked prawn products for human consumption exported to Australia will have to follow new regulations from the Australian Department of Agriculture, Water and the Environment from July 1, according to the Vietnam Association of Seafood Exporters and Producers (VASEP). The regulations are designed to manage bio-security risks related to Enterocytozoon hepatopenaei (EHP), a microsporidian parasite that affects the growth rate and sizes of prawns. The current importing requirements related to EHP for prawn products were seen as too lax. Prawn and uncooked prawn products will have to be deveined and certified by authorised organisations. Deveining is considered the most practical and effective method to reduce the amount of EHP that may exist in infected prawns. Customs clearance procedures in Australia will require checking of the products to ensure that packages are sealed. Australia's model health certificate for prawns and prawn meat for human consumption has been updated with the new criteria: “Uncooked prawns have been deveined (removal of the digestive tract to at least the last shell segment)”. The importing changes do not apply to cooked products, or to deep processed, ground or battered products, nor to prawn products originating from Australia that have been processed at Thai Union-approved facilities. Australia is Vietnam's seventh largest prawn importer, accounting for 3.8 percent of total prawn export value. In 2019, Vietnam exported over 127 million USD worth of prawn to the country, a 10.8 percent increase from 2018./. Hanoi leader receives AEONMALL Vietnam General Director Secretary of the Hanoi municipal Party Committee Vuong Dinh Hue on May 19 hosted a reception for General Director of AEONMALL Vietnam Co. Ltd. Tetsuyuki Nakagawa. Nakagawa said AEON Group considers Vietnam a key market to expand operations, especially in retail. Noting that AEON currently has five shopping malls in Vietnam, including two in Hanoi, he wished that leaders of the city would continue offering support to AEONMALL Vietnam to expand its operations. In the near future, he hoped that the city will soon approve the company’s parking area and shopping mall project at Giap Bat bus terminal in Hoang Mai district. If allowed, it will be the largest project implemented by the company in Vietnam, he said, adding that AEONMALL Vietnam is also studying more shopping mall projects in Hanoi in the future. Hue, for his part, said the project at the bus terminal will be submitted to the municipal Party Committee for consideration, so that the license certificate could be handed over to the company at the city’s investment promotion conference scheduled for late June and early July. He suggested that the company should consider expanding investment into consumption credit and cashless payment to best serve local residents./. Vietnam Airlines launches new routes from Vinh city to Central Highlands National flag carrier Vietnam Airlines has launched two domestic flights connecting Vinh city in the central province of Nghe An where President Ho Chi Minh was born with cities in the Central Highlands to mark his 130th birthday (May 19). The first flight from Vinh to Buon Ma Thuot in Dak Lak province departed at 16:05 on May 19 while the first flight from Vinh to Da Lat in Lam Dong province took off at 17:25. There will be four flights per week on the Vinh – Buon Ma Thuot route on Mondays, Tuesdays, Thursdays and Saturdays and three on the Vinh – Da Lat route on Wednesdays, Fridays and Sundays. To prevent the transmission of the COVID-19 pandemic, Vietnam Airlines conducts daily disinfection of all its operating aircraft as well as screening of passengers’ health at airports in line with regulations of the Civil Aviation Authority of Vietnam. All passengers are required to wear face masks during their journeys, while crews are also equipped with face masks and gloves. For more information about the new services, passengers can visit its official website at www.vietnamairlines.com, Facebook fanpage www.facebook/VietnamAirlines or call Customer Services hotline 1900 1100./. WB advises Vietnam on maximising benefits of EVFTA The World Bank (WB) has issued several recommendations to help Vietnam enhance its international integration and capitalise on the EU-Vietnam Free Trade Agreement (EVFTA), which is expected to come into effect shortly. In a recently-released report entitled “Vietnam: Deepening International Integration and Implementing the EVFTA”, the WB suggested the country perfect its legal framework and improve its implementation capability so as to fully reap the benefits. The report estimated that full implementation of the EVFTA could increase Vietnam’s GDP by 2.4 percent, boost exports by 12 percent, and lift an additional 100,000 to 800,000 people out of poverty by 2030. These benefits are necessary for sustaining economic achievements while the country is dealing with the COVID-19 pandemic. Benefits from its participation in new-generation FTAs such as the EVFTA and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) would be even greater if Vietnam implemented a comprehensive economic and institutional reform programme, according to the WB. These reforms would give a boost to productivity, helping its GDP increase by a further 6.8 percent to 2030. It also said Vietnam should promote its capacity to comply with rules of origin, sanitary and phytosanitary measures, and the State-investor dispute settlement mechanism. The report called on the country to bolster links between domestic suppliers and foreign-invested enterprises that are lead firms in major global value chains. The EU’s strict food safety requirements also require that Vietnam improve sanitary and phytosanitary measures in a more transparent and consistent manner. Thanks to the EVFTA, Vietnam will become a destination for a number of investors from Europe and around the world, and when the inflow of foreign investment surges, grievances, complaints, and lawsuits will also increase, the report noted, advising that Vietnam accelerate the development of a systemic investment response mechanism for resolving investor-State disputes. The WB also suggested that to maximise the benefits, support policies for post-COVID-19 economic recovery should prioritise key sectors that account for the majority of Vietnam’s exports to Europe./. Hai Phong international terminal welcomes super-heavy vessels The Cang Hai Phong International Container Terminal Co., Ltd (TC-HICT) on May 19 berthed a super tonnage ship called ONE CONTRIBUTION. TC-HICT had already successfully berthed a mother vessel, CSCL BOHAI SEA, of COSCO shipping, which directly connects Hai Phong and California, in late April. With a capacity of 8,560 TEUs and a length of 316 metres, ONE CONTRIBUTION is one of 11 super-heavy vessels belonging to a joint venture between Taiwan (China)’s Yang Ming, Japan’s ONE, Germany’s LIoyd, and HMM from the Republic of Korea. It provides direct services from the northern and southern regions of Vietnam to the west coast of the US. TC-HICT is a joint venture between the Tan Cang Saigon (Saigon Newport) Corporation, MOL Shipping and the Itochu Group from Japan, and Wan Hai Lines Ltd. from Taiwan. Commencing operations on May 13, 2018, TC-HICT is the first deep-water port in the northern key economic region and boasts two 750-metre-long container terminals, a 13.4-metre-deep access channel, and a 660-metre turning basin. The port can accommodate mother vessels of up to 12,000 TEUs and ensure a cargo throughput of 1.1 million TEUs each year. TC-HICT currently provides eight direct service routes a week, including three trans-Pacific routes, two to India, and three intra-Asia routes for Vietnam’s exports and imports, shortening the lead time by three to five days compared to current services and substantially minimising logistics costs and risks./. Thai Airways International’s restructuring plan approved The Thai Cabinet on May 19 approved a plan to restructure Thai Airways International (THAI) following the Transport Ministry's proposal that it must undergo rehabilitation under the Bankruptcy Act. Prime Minister Prayut Chan-o-cha said that the Government supports THAI’s efforts to continue operating, but refused to give details of the rehab plan. "The Government has reviewed all dimensions. We have decided to petition for restructuring and not let Thai Airways go bankrupt. The airline will continue to operate," he told reporters at a news briefing. The Cabinet has reportedly approved a plan by the Finance Ministry, which is the major shareholder in THAI, to sell 3 percent of its shares in the carrier to the second largest shareholder, the Vayupak Fund. The ministry currently holds 51.03 percent of THAI shares, while the Vayupak Fund owns around 15 percent, and the Government Savings Bank (GSB) holds around 2.1 percent. Once among the state-owned enterprises gaining profits in Thailand, THAI is now in debt of nearly 300 billion THB (nearly 10 billion USD). The national flag carrier reported a net loss of 2.11 billion THB in 2017, and this figure increased to 11.6 billion THB in 2018 and 12 billion THB in 2019. Due to the impact of the COVID-19 pandemic, THAI has been forced to cease operations until the end of May./. Strategic oil reserve remains a priority for Philippines Establishing a strategic petroleum reserve remains a top priority of the Philippines despite the difficulties in implementing the plan to do so, according to the Philippines’ Energy Secretary Alfonso Cusi. He stressed that the plan is not aimed at meeting the Philippines’ overall fuel needs but will be exploited as a backup and preventive measure. The Philippine National Oil Company (PNOC) will continue to accelerate the process of setting up a previously planned strategic petroleum reserve. It has been conducting a comprehensive feasibility study for the project after the Department of Energy (DOE) issued a document in December last year. The PNOC is in the process of finalising the feasibility study and will give relevant and timely notice as requested, Cusi said. The DOE previously said that technical and budgetary difficulties needed to be resolved in order to build a strategic petroleum stockpile./. VNN |
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Vietnam set to become shelter for foreign real estate investment post-COVID-1902:35 Big companies like Apple, Nintendo, and Samsung and their supplier have switched out to limit damage.
Vietnam’s property market is likey to receive inflows of foreign investment after big countries encourage their companies to relocate manufacturing bases out of China due to the global pandemic. The Southeast Asian nation set to get a second round of tonic from global companies diversifying their production bases in the region as the coronavirus outbreak exposes the concentration risk in China, according to South China Morning Post. It stands to benefit as the exodus from “the world’s factory” accelerates, burnishing its appeal as an alternative to China since the likes of Apple, Samsung and their suppliers switched out to limit the damage caused by higher tariffs in the US-China trade war. Analysts say industrial and residential property in the capital of Hanoi and Ho Chi Minh City are likely to get another tailwind after the pandemic lockdown disrupted supply chains and escalated trade and political tension between China and other economic powerhouses. “This COVID-19 outbreak is forcing many companies to re-evaluate their supply chain strategy,” said Sunny Hoang Ha, sales director at SPG Land Vietnam, part of a group that controls Greenland Hong Kong Holdings. “Vietnam is primed to benefit.” With relatively developed infrastructure and proximity to China, Vietnam has attracted the majority of those who wanted to diversify their manufacturing portfolio outside China, according to JLL, a global real estate and investment management firm. Although the COVID-19 pandemic was currently causing difficulties for investment decisions or relocation activities, industrial park developers remained confident of increasing land prices as they were well aware of long-term potential in Vietnam’s industrial segment, sending land prices soaring in the northern industrial market, JLL explained. Demand for industrial land remained strong in the first quarter this year thanks to Vietnam’s good industrial fundamentals, the consultancy company noted. “With the influx of foreign industrialists, they will need accommodation for both the foreign staff as well as local staff who might have come from other provinces,” said Jeremy Williams, chief business officer at PropertyGuru, which operates www.batdongsan.com.vn portal. “The residential segment will see an increase in demand, hence providing an uplift to prices.” Vietnam’s early response to pandemic helps Vietnam’s response to the coronavirus crisis has been hailed as a model for low-cost best practice in curbing the contagion. With 324 infected cases and zero deaths, Vietnam has relaxed restrictions, enabling itself to become one of the first countries to restart its economy. For that reason, property developers, private equity funds and analysts are still betting on the prospects of Vietnam’s real estate market in which foreigners and foreign organizations are eligible to own houses in the country in a tenure of 50 years. Analysts are watching if Japan’s latest move will instigate a rush to Vietnam and elsewhere. The Japanese government last month unveiled a US$2.2 billion fund to pay its manufacturers to move out of China, stricken by a breakdown in supply chain following lockdown measures in January to stem the viral outbreak. Officials from the US and the EU have also indicated their willingness to reduce their dependencies on other countries. Apple, Nintendo and Samsung and many of its Asia-based suppliers have relocated some of their production or assembling capacity to Vietnam. Foreign direct investment rose for seventh straight year as suppliers to Apple, Nintendo, Samsung build new bases “The thinking about ring-fencing supply chain to reduce over-reliance on one single production base will only expedite the move,” Jeremy Williams noted. “Vietnam benefits from its proximity to China as well as its skilled and disciplined labour, which costs only a fraction of China’s.” Besides, Vietnam’s young population provides a ready pool of talented professionals, adding to its investment appeal. Hanoitimes VNN/Linh Pham |
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BUSINESS NEWS HEADLINES MAY 2502:40 Japanese newspaper: EVFTA to lift Vietnam’s post-pandemic growth  Japanese daily Nihon Keizai ran an article on May 20 saying that the EU-Vietnam Free Trade Agreement (EVFTA), to be ratified by Vietnam’s legislature shortly, will benefit not only the two signatories but also businesses from other countries. It noted that the two will eliminate 99 percent of import tariffs within a decade, which will help Vietnam increase its exports to the bloc, which accounts for some 15 percent of the country's total. Japanese enterprises working in Vietnam are also expected to benefit from the deal. As the world third-largest apparel exporter behind China and Bangladesh, the space for Vietnam to bolster its garment exports remains huge. Several Japanese companies are producing apparel in Vietnam, notably Fast Retail - the owner of the well-known Uniqlo brand - and also manufacturing auto spare parts and machinery for export to Europe. The EVFTA will therefore help them expand production and enter Europe more easily. Conversely, the EU ships aircraft and automobiles to Vietnam. With a population of around 97 million, the third-largest in Southeast Asia, and with an average income per capita of about 3,500 USD each year, Vietnam is forecast to see growing domestic consumption. As the first country in Southeast Asia to normalise economic activities following the COVID-19 pandemic, the EVFTA is expected to boost Vietnam’s exports in the near future, the paper wrote./. Mobile World Investment Corp to lower profit target by 30 per cent Mobile World Investment Corporation (MWG) is seeking its shareholders’ approval on plans to adjust down both revenues and net profit this year, citing difficulties caused by the COVID-19 pandemic. In the documents sent to shareholders before its annual shareholders’ meeting, expected on June 6, the company projects its consolidated net revenue will reach VND110 trillion (US$4.72 billion) by year-end while the after-tax profit is estimated at VND3.45 trillion ($148 million). These numbers are 10 per cent lower than its initial revenue target and 30 per cent lower than its net profit goal set for 2020. The previous plans were VND122.45 trillion in net revenue and nearly VND4.84 trillion in net profit. This plan is still a challenge for the company, according to the document, as the disease broke out in the peak period for selling mobile phones and electronic devices following the massive cancellation of sport events, so its two chains – The Gioi Di Dong and Dien May Xanh – will not have many opportunities to improve sales in the second half of the year. Meanwhile, food and essential consumer goods are still in the expansion stage and have yet to bring in much profit. The new plan is 8 per cent higher than last year’s revenue but 10 per cent lower than 2019’s profit. In 2019, MWG earned total sales of VND102.2 trillion and net profit of VND3.84 trillion. This is the first time the company has set a lower profit target than the previous year. The company’s chairman Nguyen Duc Tai last week told investors that revenue has improved in May but cautioned difficulties ahead, predicting purchasing power would likely decline this year and even next year due to falling incomes of consumers. In the first three months, MWG reported net revenue of VND29.35 trillion and net profit of VND1.13 trillion. The company has recently updated its business results in April with revenues of VND7.3 trillion, down nearly 20 per cent from more than VND9.1 trillion recorded in 2019’s same month. In particular, the total sales of The Gioi Di Dong and Dien May Xanh in April decreased by about 30 per cent year-on-year and the company had to close a large number of stores during the social distancing period. MWG shares have lost about 27 per cent this year, being traded around VND87,000 ($3.73) per share on the Ho Chi Minh Stock Exchange./. Bamboo Airways plans to launch more domestic and international air routes Bamboo Airways has set a target of doubling its domestic air routes to 60 by the end of 2020, and raising the number of international routes from six to 25, with that to the US expected to be re-launched in late 2021 or early 2022. The carrier’s Chairman Trinh Van Quyet made the statement on Tuesday, given the fact that the COVID-19 pandemic has been basically controlled in Viet Nam. To serve the plan, the airline is intending to buy 60 General Electric (GE) engines and related services in 2020 with a total value of US$2 billion to serve the Boeing 787-9 Dreamliner fleet it is ordering. It will hire more planes this year, instead of purchasing more, to facilitate the expansion plan, Quyet stated. Bamboo Airways, he went on, is operating 45-50 domestic flights a day, and is scheduled to raise the number to over 100 in early June, or equal to 80 per cent of the frequency before the COVID-19 happened. The airline is expected to go public on the stock market in the fourth quarter of 2020 after the initial plan of being listed in the second quarter was postponed due to the pandemic. In the first quarter, it posted a loss of over VND1.5 trillion (US$64.2 million) due to a remarkable reduction of both domestic and international flights./. Da Nang proposes halting sightseeing fees to tourist attractions The tourism industry based in the coastal city of Da Nang has put forward a range of tourism stimulus packages including exempting visitors from paying for tickets when visiting tourist attractions in the city in the near future. The proposal was originally made during a recent meeting held between members of the provincial Tourism Department as they devised plans in which to stimulate the domestic tourism industry in the post-pandemic period following the novel coronavirus. At present, the central city has launched an initial tourism stimulus package titled "Danang Thank You" and assigned the provincial Department of Tourism to co-ordinate actions with relevant agencies in an attempt to organise the "Fantastic Da Nang Festival 2020" scheduled for between June and September this year. With an added boost from tourism stimulus packages, the coastal city is anticipated to attract approximately 2.4 million visitors during the second half of the year, with total tourism revenue climbing to over VND9 trillion. Moreover, approximately 120 travel firms have joined the city in promoting the scheme as a means of stimulating domestic tourism demand, with discounts for travel services on offer ranging from 30% to 50%. The total expenditure with regard to the participation of travel firms in the city’s tourism stimulus programme is estimated to reach between VND15 billion and 20 billion. Most notably, the Department of Tourism has proposed providing exemptions for visitors to tourist attractions across the city, such as the Ngu Hanh Son landscape site, also known as the Marble Mountains, and museums for three months as part of a range of activities aimed at stimulating domestic tourism./. Plummeting exports hit hard by COVID-19 impact during first half of May Vietnam’s exports to foreign markets have suffered a dramatic downturn since April as a result of the negative economic impact caused by the novel coronavirus (COVID-19) pandemic, after recording positive growth throughout the first quarter of the year, according to the Ministry of Industry and Trade. The country bagged an estimated US$8.22 billion from exports during the first half of May, the lowest level of revenue since the start of the year. Meanwhile, its import turnover reached approximately US$9.2 billion, resulting in a trade deficit of roughly US$1 billion throughout the reviewed period. According to a statement made by the Ministry of Industry and Trade, with the COVID-19 epidemic spreading globally since mid-March, global supply chains have been severely disrupted, therefore significantly affecting the country’s export-import activities. With trade activities since April being greatly impacted as a result of the COVID-19 pandemic, the negative trend is anticipated to continue moving into the second quarter as some of Vietnam’s major trading partners such as the United States, the European Union, and Japan are the hardest hit and it is unlikely that they will rebound in the short-term period. At present, the majority of importers have moved to cancel orders in April and May, while also temporarily halting negotiated orders from June onwards. This postponement can be attributed to the fact that several countries globally have imposed lockdowns in an attempt to slow the spread of the COVID-19, leading to a shortage of raw material sources from the beginning of March that are necessary for the domestic footwear industry in addition to local garment and textile firms. If the COVID-19 is successfully brought under control ahead in the second quarter of the year, the country’s exports are expected to bounce back during the second half of the year. This rejuvenation will offer fresh impetus to the country’s economic growth due to the recovery of global consumption demand and the competitive advantages brought about by the EU-Vietnam Free Trade Agreement (EVFTA) when it takes effect later this year. Despite posting a trade deficit in the first half of May, Vietnam’s import-export turnover since the beginning of the year reached roughly US$177 billion, with the country enjoying a trade surplus of approximately US$1.4 billion./. Electronics, spare parts export posts impressive growth Computers, electronics and spare parts have surpassed garment to become the second largest currency earner in first four months of this year, according to the General Statistics Office. Specifically, the sector raked in 12.14 billion USD during the period, up 26 percent year-on-year. Of the figure, 3.42 billion USD was from China, up 40.9 percent. Other major markets include the European Union with 1.55 billion USD, down 6.3 percent; the US 2.67 billion USD, or a 2.1-fold increase; Hong Kong 945 million USD, up 33.6 percent; and the Republic of Korea 851 million USD, down 9.7 percent./. Cambodia plans electricity price cut to revive economy The Cambodian government has issued a plan on reducing electricity tariffs for firms in four key sectors – manufacturing, agriculture, commercial and service – for five months to beef up the economy plagued by the COVID-19 pandemic. Accordingly, starting from June, electricity bills are expected to be reduced by 25 percent based on previous averages from January to March of this year. The Electricity Authority of Cambodia will issue details of the electricity tariff next week before the programme is implemented next month, The Phnom Penh Post newspaper quoted Victor Jona, director-general of the ministry’s General Department of Energy, as saying. The country’s National Committee for Combating COVID-19 last week discussed easing restrictions and reopening businesses in priority sectors. In fact, Cambodian people are gradually returning to their usual routines as no new infections were recorded over the past month and 122 infected cases were discharged from hospitals. Or Vandine, spokeswoman for the Ministry of Health, revealed some sectors which could be allowed to reopen such as restaurants, entertainment establishments and schools. However, she warned that as the government charts a course to recovery from the pandemic, it is necessary for everyone to be responsible for preventing a second wave of coronavirus outbreak./. Banks roll out preferential credit packages Many commercial banks have unveiled preferential credit packages for both individual and corporate customers. Sacombank has a 16 trillion VND (686.2 million USD) package. Individual customers who do not have loans and are using its products and services can get credit at interest rates starting at 6 percent for short-term loans and 7 percent for medium-term loans for their business. Consumer loans for purposes like buying a car and buying/building/repairing properties will be given loans at interest rates starting from 7.5 percent for short tenors and 8 percent for the long term. Corporate customers can get loans starting at 5 percent if they meet certain conditions. The offer is valid until June 12 for individual customers and August 11 for corporate customers. An Binh Joint Stock Commercial Bank (ABBANK) has a war chest of 2.3 trillion VND (98.7 million USD) to be lent at interest rates starting at 6.5 percent to small and medium-sized enterprises in priority sectors such as food, beverages, rice, construction, supply of machinery and equipment to works using State capital, pharmaceuticals, medical equipment including masks and protective equipment, retail, logistic services, petroleum, and electronic accessories. Besides reducing interest rates by up to 2.5 percentage points to corporate customers affected by the COVID-19 pandemic, Viet Capital Bank has also launched several preferential credit packages worth a total of 6 trillion VND (257.4 million USD) for SMEs. These will be deployed until year-end./. Cambodia inks deal with IRRI to improve rice sector Cambodian Ministry of Agriculture, Forestry and Fisheries on May 20 signed an agreement with the International Rice Research Institute (IRRI) aiming at improving the country’s rice sector through promoting research and enhancing productivity and resiliency. Signatories to the agreement were Cambodian Minister of Agriculture, Forestry and Fisheries Veng Sakhon and IRRI Regional Representative for Southeast Asia Yurdi Yasmi. The IRRI representative said the agreement marked an important step forward in the traditional collaboration over the past more than four decades between the IRRI and Cambodia in the context of Cambodia’s rice sector facing such challenges as climate change, diseases, drought and declining productivity. The Cambodian Government places strategic importance in strengthening the role of the agricultural sector, with rice-based farming systems central in generating jobs, ensuring food security, reducing poverty, and developing rural areas. The IRRI’s assistance has contributed remarkably to helping Cambodia increase its rice output from 2.4 million tonnes in 1993 to 10.8 million tonnes last year. According to statistics of the Cambodian Ministry of Agriculture, Forestry and Fisheries, the country produced 31 million tonnes of food in 2019, generating income of 10 billion USD. Among its food exports, rice was the top foreign currency earner with 620,264 tonnes shipped abroad last year, bringing in 500 million USD./.. Thai economy to return to normal in three years The Thailand Development Research Institute (TDRI) has forecast that Thailand is likely to take up to three years to return to normal economic conditions similar to 2019. Speaking at a seminar titled "New Normal for Business Sector" held by the Thai Chamber of Commerce (TCC), Somkiat Tangkitvanich, TDRI's president, said this economic crisis triggered by the coronavirus outbreak is expected to be bigger than the 2008 global financial crisis. He said TDRI expects it will take a year to 18 months to make and distribute a vaccine, and up to three years for the Thai economy to return to 2019 levels. According to Somkiat, Thailand is in a transitional period, with lockdown measures starting to ease and many businesses allowed to reopen. However, he insisted tight control measures are still needed to curb a second wave of the outbreak. The business sector needs to come up with new business practices to adapt to a changing business environment. Despite massive fiscal stimulus packages and monetary easing, CIMB Thai Bank (CIMBT) predicted the Thai economy could continue falling sharply this quarter, with GDP contraction possibly below the 12.5 percent seen in the second quarter of 1998. Thailand’s full-year GDP growth contracted by 7.6 percent 22 years ago when the economy reeled from the Asian financial crisis in 1997. "We project a sharp fall of GDP in the second quarter by 14 percent from the previous year," said Amonthep Chawla, head of research at CIMBT. Amonthep said exports could continue to plunge from weak global demand and continual lockdowns in major economies. The number of tourist arrivals in the second quarter should drop sharply from travel restrictions. The private sector will likely remain weak for both consumption and investment, following a decline in both farm and non-farm income and a lack confidence among consumers and investors, he said. Thailand's economy contracted by 1.8 percent year-on-year and 2.2 percent quarter-on-quarter on a seasonally adjusted basis for the first quarter, mainly attributed to the COVID-19 outbreak affecting the lucrative tourism industry, external demand and domestic private consumption. The economy could shrink by about 10 percent year-on-year in the second half, but quarterly growth could recover, he said./. Exports to China projected to bounce back: MoIT Exports to China may bounce back in the time to come thanks to rising demand as the northern neighbour further contains COVID-19, according to the Ministry of Industry and Trade (MoIT). Bilateral trade hit more than 35 billion USD in the first four months of this year, of which Vietnam earned 12.7 billion USD from exports, a year-on-year increase of 22.1 percent. China is Vietnam’s second-largest export market, with 15.7 percent of the total, behind the US, which has the lion’s share of 24.9 percent. Vietnam purchased goods worth 22.38 billion USD from China in the four-month period, down 1.6 percent year-on-year. Vietnam’s trade deficit with China fell to 9.68 billion USD from over 12 billion USD in the same period last year. The recent re-opening of a number of auxiliary border gates and crossings has helped revitalise bilateral trade. Even though the pandemic has forced countries to restrict movement, which hurt trade, Vietnam has bolstered trade activities through online channels and expanded its export markets, the ministry said. The Vietnam Trade Promotion Agency (VIETRADE) at MoIT and the Department of Commerce in China's Guangxi province held the Vietnam-China online trade conference in April, with more than 150 enterprises in farm produce and foodstuff taking part. To remove bottlenecks in exports, MoIT suggested the Government allow the resumption of trade activities at all borders. Border gates and crossings already permitted to re-open include Binh Nghi, Na Hinh, Na Nua, and Po Nhung in Lang Son province and Bac Phong Sinh and Ka Long in Quang Ninh province. When deciding upon the re-opening of other gates, authorities in border localities have been asked to consider the current circumstances while giving priority to disease prevention and control./. Indonesia’s car export predicted to halve in 2020 Indonesia’s car exports are forecast to drop by 50 percent in 2020 due to large-scale social restrictions amid the COVID-19 pandemic, according to Association of Indonesian Automotive Manufacturers (Gaikindo). In April, the country’s domestic car sales nosedived by more than 90 percent year-on-year. Gaikindo also slashed Indonesia’s car export target to 175,000 units in 2020 from the initial target of 350,000 to 400,000 units. Chairman of Gaikindo Yohannes Nangoi said it will be difficult for the country to reach its export target of 1 million cars by 2025. Indonesia’s consumer confidence index plummeted to its lowest level in 12 years as consumers expressed pessimism amid the pandemic, according to a recent Bank Indonesia (BI) survey. Yohannes said the health crisis threatened 1.5 million automotive industry workers in the country, though Gaikindo members agreed to avoid layoffs./. Indonesia's manufacturing industry struggles over capital shortage Indonesia’s manufacturing industry is facing two main obstacles in terms of limited cash and working capital flows amidst the COVID-19 pandemic in the country, said Industry Minister Agus Gumiwang Kartasasmita on May 20. According to the minister, one of the solutions to the limitations of capital flows is to facilitate credit restructuring. Meanwhile, working capital is needed to restart industrial activities, when the situation returns to normal. As such, he said there should be efforts to encourage investment, in addition to promoting export markets. The minister added that to solve these challenges, the Ministry of Industry alone cannot promote the recovery of manufacturing industry, but needs coordination with other ministries and industries so that the industrial sector can recover quickly after the COVID-19 pandemic is over. The Indonesian government is preparing a number of economic stimulus packages, including tax incentives, thus the industry must continue to operate in the context of social distancing. According to the Central Statistics Agency (BPS), manufacturing is the largest contributor to Indonesia's Gross Domestic Product (GDP), accounting for 19.98 percent of the GDP in the first quarter of 2020. However, the industry grew only 2.06 percent during the period, lower than its 3.85-percent growth recorded in the same quarter last year./. FPT Software partners with OutSystems to develop low-code platforms in Japan Vietnam’s largest tech firm FPT Software has signed a partnership agreement with global software firm OutSystems to develop low-code platforms, in a bid to strengthen the foothold of both in the Japanese market. FPT will provide a comprehensive range of services, from development and operation to maintenance of software applications on its low-code platform. Low-code, as defined by OutSystems, is a software development approach that enables the delivery of applications faster and with minimal hand-coding. Rather than writing thousands of lines of complex code and syntax, low-code platforms allow users to build complete applications with modern user interfaces, integrations, data, and logic quickly and visually. Arnold Consengco, OutSystems’s Northeast Asia and Japan Regional Vice President, said FPT has a large number of resources, multi-language capabilities, and a strong position in Japan. He expressed his belief that the two sides will be successful in building an ecosystem and expand opportunities in the market./. OVs urged to develop distribution channels for Vietnamese goods Vice Chairman of the Hanoi People’s Committee Nguyen Doan Toan signed a document on May 20 calling for the involvement of overseas Vietnamese in introducing and developing distribution channels abroad for Made-in-Vietnam goods in the 2020-2024 period. The plan is part of activities to speed up the “Vietnamese people give priority to using Vietnamese goods” campaign among Vietnamese communities abroad and to raise export turnover and increase the use of Vietnamese products by overseas Vietnamese. It also targets greater sales of Vietnamese goods at shopping centres and supermarkets in foreign countries, especially those in regions where a large number of Vietnamese expats live. Attention will also be paid to enhancing connections between businesses in Vietnam and overseas and building establishments that can perform testing on requirements and regulations in line with international standards./. Indonesia attracts 4.1 billion USD worth of net inflow Indonesia posted a net inflow of 4.1 billion USD from April to May 14, after recording a net outflow of 5.7 billion USD in the first quarter of 2020, said Bank Indonesia (BI) Governor Perry Warjiyo on May 19. According to the official, the foreign capital inflow began to improve again from April 2020 driven by easing global financial market uncertainties, high competitiveness of domestic financial assets, and favourable outlook for the Indonesian economy. Meanwhile, foreign exchange reserves increased to 127.9 billion USD at the end of April, which was equivalent to financing 7.8 months of imports. The figure is more than enough to meet import and debt payments and exchange rate stabilization, Perry said. The central bank also estimated the current account deficit in 2020 to be below 2 percent of gross domestic product (GDP) from an initial estimate of 2.5-3 percent of GDP./. Tra Vinh farmers expand organic rice areas The Mekong Delta province of Tra Vinh has encouraged farmers to expand environmentally friendly organic rice fields that have improved the quality of rice and soil fertility. In Cau Ngang, more than 100 farmers in Cau Ngang’s My Hoa, Kim Hoa, Vinh Kim and Hiep Hoa communes signed a contract in 2017 with a company to grow organic rice on a total area of 82ha. The company provided farmers with techniques such as sowing, fertilising, disease management and harvest methods. The company also supplied materials, and it guaranteed outlets for the farmers. In the first organic rice crop, the farmers earned a profit of 30 million VND (1,300 USD) per hectare per crop, up 6 million VND (260 USD) compared to normal farming methods. Organic rice fields use less fertiliser and do not use chemicals. Farmers can also breed aquatic species in ditches in the rice fields to earn additional income, or rotate rice and aquatic species on the same fields. Thach Mara, who has planted organic rice in Hiep Hoa commune since 2017, said rice grown under organic standards develops well and adapts to climate change. In his first crop, his 0.4ha rice field had a yield of 6 tonnes per ha, up one tonne compared to traditional farming methods. He expanded the organic rice area to 0.7ha this year. Tran Hong Nghiep, an agricultural official in Hiep Hoa, said to encourage farmers to grow organic rice, the commune guarantees outlets for farmers and link them with others who produce organic rice. The commune’s organic rice cooperative group has called on farmers to join the group which can easily link up with companies and access government support policies. The group now has 49 members who grow a total of 52ha of organic rice. Its members who rotate organic rice cultivation and black tiger shrimp or giant river prawn breeding on their rice fields earn a profit of 50 - 60 million VND (2,200 - 2,600 USD) per ha for each shrimp crop. Nguyen Ngoc Hai, Deputy Director of the provincial Department of Agriculture and Rural Development, said that farmers, companies and the State have developed linkages under the organic model, which has improved the value and quality of the province’s rice. Besides the health benefits of organic food, organic farming improves soil fertility and protects aquatic resources. Tra Vinh grows more than 200,000ha of rice each year, but has only a few hundred ha of rice planted under organic standards. The coastal province plans to increase its organic rice area to 1,000ha by the end of this year and to 2,500ha by 2030, according to the department./. Electronics, spare parts export posts impressive growth Computers, electronics and spare parts have surpassed garment to become the second largest currency earner in first four months of this year, according to the General Statistics Office. Specifically, the sector raked in 12.14 billion USD during the period, up 26 percent year-on-year. Of the figure, 3.42 billion USD was from China, up 40.9 percent. Other major markets include the European Union with 1.55 billion USD, down 6.3 percent; the US 2.67 billion USD, or a 2.1-fold increase; Hong Kong 945 million USD, up 33.6 percent; and the Republic of Korea 851 million USD, down 9.7 percent./. Thailand’s e-commerce projected to grow 35 percent this year Thailand's e-commerce, excluding business-to-business engagement, is expected to grow 35 percent to 220 billion THB (nearly 7 billion USD) in 2020. Local media quoted Thanawat Malabuppha, Chief Executive of price comparison shopping website Priceza and President of the Thailand e-Commerce Association, as saying that in the post-COVID-19 world, the online channel and e-commerce are no longer an alternative option, but rather a means of survival. The country's e-commerce through business-to-consumer and consumer-to-consumer is projected to jump to 220 billion baht in 2020, accounting for 4-5 percent of total retail. Thanawat estimated e-commerce could reach 25 percent of Thailand's total retail, similar to China, in 5-10 years. In 2019, e-commerce retail sales were valued at 163 billion THB, making up 3 percent of total retail. E-marketplace value accounted for 47 percent of e-commerce, followed by social media 38 percent and brands' own websites 15 percent./. Tho Xuan Airport strives to serve five million passengers per year by 2030 Tho Xuan Airport in the central province of Thanh Hoa plans to serve five million passengers and 25,000 tonnes of goods each year by 2030, online newspaper laodong.vn reported. The Civil Aviation Administration of Viet Nam (CAAV) has outlined a plan to develop the airport by 2030 with a vision toward 2050 which has been sent to the Ministry of Transport for approval. Under the plan, Tho Xuan will become an international airport capable of receiving wide-body aircraft such as the Boeing B787-9 and Airbus A350-900 by 2030. The CAAV said the airport’s capacity has grown significantly in recent years, leaving behind its previous growth predictions. However, the last plan set for Tho Xuan was approved in 2013 and modified in 2014. The airport served nearly 91,000 passengers in 2013 when it received its first flight. The number soared to one million in 2019. Located in Sao Vang Town, Tho Xuan District, the airport plays an important role in aviation transportation and national overflight protection. In 2018, the Ministry of Transport agreed to upgrade Tho Xuan to an international airport. The ministry has also assigned the CAAV to study and adjust the plan where necessary. ETFs to make no changes in investment lists: SSI Research There may be no changes in the lists of investees by exchange-traded fund (ETF) indices in the upcoming quarterly review, SSI Research has forecast. The calculation of investees’ proportion in the FTSE Vietnam Index and MVIS Vietnam Index must be finished by May 29 so review announcements are made on June 5 and June 12, respectively. The quarterly review will be complete on June 19. SSI Research – the research division of brokerage firm SSI Securities – predicted there will be no changes in the two indices’ lists of investees. As of May 15, the total value of investment made by FTSE Vietnam Swap UCITS ETF declined to 199 million euro (US$218.3 million) from February. The list of investees by FTSE Vietnam ETF contains 18 stocks traded on the Ho Chi Minh Stock Exchange (HoSE). The fund is expected to increase investment in three stocks – Vingroup (VIC), Vinhomes (VHM) and Vietcombank (VCB). Vingroup and Vinhomes shares will account for 15 per cent of the total portfolio, up 0.5-1.11 percentage points while Vietcombank shares will take an 8.65 per cent stake in the list, up 2.22 percentage points. The fund is forecast to cut its investment in the remaining 15 stocks such as dairy producer Vinamilk (VNM; down 1.69 percentage points), Vincom Retail (VRE; down 0.28 percentage points), and steel maker Hoa Phat (HPG; down 0.32 percentage points). FTSE Vietnam ETF is managed by the London-based asset firm FTSE Russell, focusing on Vietnamese equities. The MVIS Vietnam Index, developed by the US investment management firm VanEck, is expected to raise investment in Vingroup, Vinhomes, Vietcombank and steel producer Hoa Phat. On the other hand, shares of Vinamilk, Masan, PetroVietnam Power (POW), sugar firm Thanh Thanh Cong-Bien Hoa (SBT), and insurer Bao Viet Holdings (BVH) are among divestment targets. Shares of Vinamilk, Vietcombank, Vingroup, Thanh Thanh Cong-Bien Hoa, Vinhomes gained between 0.3 per cent and 1.4 per cent on Thursday while Masan and Vincom Retail shares dropped 0.6 per cent and 0.8 per cent. Real estate Landmark Holding shares dive on delisting decision Shares of Landmark Holding JSC tumbled for a second day after the firm was delisted by force from the Ho Chi Minh Stock Exchange (HoSE). The petrochemical and real estate trading firm’s shares (HoSE: LMH) plunged 6.5 per cent to trade at VND1,000 apiece on Thursday. Shares dived 7.0 per cent on Wednesday. On Tuesday, the southern bourse HoSE announced more than 25.62 million shares of Landmark Holding will be delisted on June 19. The decision was made after audit firm made a disclaimer of opinion on the company’s 2019 financial report. The disclaimer of opinion is often the worst type of feedback an auditor may have on a firm’s financial report. It means the auditor is unable to form an opinion as there are insufficient proof in the financial statement. On April 27, HoSE warned Landmark Holding shares could be delisted for the same reason. The company debuted on HoSE on October 12, 2018 at VND11,200 (US$0.48) per share. Shares reached the highest of VND16,590 apiece on July 25, 2019 before nosediving ever since. Landmark Holding is known as the investor of several real estate projects in Ha Noi, including the Manhattan Tower in Thanh Xuan District. But the company quit the project in August 2019. US, Indian tech firms bring logistics route optimisation solutions to VN US technology consulting firm KMS Solutions has entered into a strategic partnership with Indian company Locus, a pioneer in deep-tech supply chain solutions, to introduce the latter’s smart logistics software to the Vietnamese, Thai and Cambodian markets. The technologies will enable enterprises in those countries to enhance efficiency, transparency and consistency in last-mile delivery and overall supply chain operations. With built-in machine learning and proprietary algorithms, Locus’ route optimisation software recommends the most efficient routes for delivery, meaning routes that allow drivers to deliver the most items in the shortest time and at the lowest cost. KMS Solutions will provide consultancy and help instal a number of Locus’ software products such as Route Optimization, Real-time Tracking, Last-mile delivery, and Analytics. All are hand-picked for its clients in Viet Nam, Thailand, and Cambodia. Omnichannel retailing has led to a rise in demand for delivery services, which makes last-mile logistics a key area of investment for enterprises, especially those in retail, e-commerce and distribution. However, offsetting last-mile delivery costs while satisfying demand for quick delivery remains a problem for most of them. “To solve the last-mile delivery challenge, enterprises increasingly employ innovative logistics solutions such as route optimisation,” Seema Bhandari, partnership director at Locus, said. More land violations discovered on Phu Quoc Island The Government Inspectorate has pointed out various violations at constructions built on agricultural lands on Phu Quoc Island, including large hotels. According to the inspectorate, from 2016 to June 2018, the authorities failed to monitor or control the rapid rise of spontaneous urban areas on agricultural land. There are 577 plots of land that cover 495ha in nine towns and communes. 737 houses have been built, of which 96 are on agricultural land. From 2011 to April 2018, the urban management order teams of Phu Quoc Island and nine towns and communes discovered and reported various violations in constructions including 700 illegal constructions on agricultural land. 1,000 administrative fine orders were issued but only 46% were applied. The inspectorate also found several illegal constructions in functional areas but the local authorities failed to inspect, monitor thoroughly and were slow to deal with the problems. The construction of the Seashell 5 Hotel was started in January 2016 when its building permit already expired. Only in January 2018 was the violation detected by the inspectorate of the Ministry of Construction. The hotel investor was reported and fined. After the investor was fined, on February 8, 2018, the management board of Phu Quoc Economic Zone issued a building permit for the construction. They also built two more attics that cover 600 square metres and are five metres taller than permitted. The illegal constructions will be dealt with in accordance with the law. Building without a permit violation is also found at the Pullman Resort of the European resort and eco-tourism project invested by Milton Company. Kien Giang Province's inspection team carried out the inspection from April 2 to August 17. But only two months later that the management board of Phu Quoc Economic Zone issued the building permit for the constructions at the European resort and eco-tourism project. Electronic Certificates of Origin proves key to bolstering trade with India The approval of Electronic Certificates of Origin (e-CO) is set to play an important role in meeting the trade target of US$15 billion set by both leaders of Vietnam and India, according to Vietnamese Ambassador to India Pham Sanh Chau at the “India - Vietnam Virtual Business Meet 2020" online seminar held on May 21. The event was jointly held by the Vietnamese embassy’s trade office in India, the Confederation of Indian Industry, the Vietnam Chamber of Commerce and Industry, and other relevant agencies. In the country’s role as the ASEAN Chair in 2020, Vietnam has been actively exchanging information with other ASEAN member countries with regard to the Indian proposals to use electronic certificates of origin, with several countries restricting travel in the context of the complicated nature of the novel coronavirus (COVID-19) epidemic, noted ambassador Chau. This move comes following the nation receiving a proposal from the Indian Government on April 17 which urged consideration to be made and approval to be granted to the e-CO via the Indian electronic portal for the benefits of tariff preferences in line with the ASEAN-India Free Trade Agreement. The embassy also offered a report to the Government Office in which it requests all relevant ministries to grant approval to the Indian proposals swiftly in an effort to remove difficulties faced by local firms that have been severely affected by the COVID-19 pandemic. The Vietnamese diplomat went on to emphasis that any delays in accepting the e-CO will cause great damage to domestic businesses and make it far more challenging to reach the bilateral trade turnover target of US$15 billion which has been set by the end of the year. Majority of travel operators in HCM City resume operations Approximately 60% of tourism businesses based in Ho Chi Minh City have reopened following their temporary shutdown to combat the novel coronavirus (COVID-19) epidemic, with most firms in need of financial support in order to maintain future operations. Information on the rejuvenation of enterprises in the southern city’s tourism sector was released by Nguyen Thi Anh Hoa, Deputy Director of the Ho Chi Minh City Department of Tourism, during recent talks with a Voice of Vietnam (VOV) reporter. According to Hoa, firms which returned to work will now mainly focus on the domestic tourism market, while suspended tourism businesses are set to primarily concentrate on inbound and outbound market segments. The fourth quarter of the year will see a number of travel operators reopen as they wait on developments around the world regarding COVID-19 control efforts, as well as waiting for an official announcement from the State with regard to welcoming international visitors. At present, the Ho Chi Minh City Department of Tourism is implementing a range of policies to extend the payment of tax and rent, in addition to offering electricity price support, credits for businesses, while serving as a bridge that connects firms with competent agencies in order to facilitate the implementation of incentive policies. The majority of enterprises are currently in need of financial support in order to realise capital rotation, pay staff salaries, and pay necessary expenses as a means of maintaining operations. The Department has so far received requests from about 50 firms who wish to receive credit support packages. This list of businesses has been transferred to the State Bank branch in Ho Chi Minh City from which commercial banks are ready to take steps in order to provide timely support for enterprises that operate in the tourism industry. Due to the impact of the COVID-19 epidemic, tourism businesses are at risk as they are mostly small and medium-sized firms which lack close linkages in order to be fully capable of coping with the fallout from the epidemic, Hoa said. “This time is essential for businesses to restructure, rebuild alliances, links, and single out which product segments are their strengths. Simultaneously, they need to restructure human resources and the tourism market so as to gain a reputation and a competitive brand on the domestic and international tourism market,” she added. Vietnam Railways bets on upgrades In the wake of the positive impact of digitalisation, state-owned railway giant Vietnam Railways is focusing more on technology application as a way to increase both customer experience and operational efficiency. However, the path remains bumpy given a long history of traditional infrastructure. Vietnam Railways (VNR) has just begun to apply freight management system software on the national railway network after some trials. It is the result of co-operation between VNR and FPT Information System Co., Ltd., which is assisting the former in overhauling its traditional freight governance. The software enables the giant to deploy network administration in management and operation of locomotives and railroad cars along with freight management. With the new deployment, the traditional recording and exchanging information by phone is replaced with data entry and information exchange on the system. “This system can digitalise the entire transportation process, including standardising reporting and statistical forms, helping administrators manage more efficiently and therefore saving on cost and reducing manual works,” said Phan Quoc Anh, deputy general of VNR. This is one of several applications that the railway industry has deployed in recent times. Previously, VNR has also co-operated with e-wallet startup MoMo to launch a new e-service that allows mobile phone users to purchase train tickets online through an app. Like most industries, digital transformation is making huge impacts on rail transport, motivating it to make positive changes. The traditional measurements for rail transport performance requirements remain, but there are added advantages in the application of digital technologies. For railways, the main impact of digitalisation is on the model of operation. Technologies like AI, big data, cloud computing, and autonomous driving will impact the industry. These technologies are expected to create a new environment in which rail operators will need to be more agile, act more quickly, and change continuously in order to succeed in their mission amid stiffening competitions from rivals. Given all these factors, transformation is inevitable and not just an option. VNR is aware of this, with council members recently approving a scheme on technology application for this decade, focusing on business governance along with safety within management, mechanics, transport, and infrastructure. Specifically, for business governance, VNR will gradually strengthen AI-backed analysis systems, establish a sci-tech research and development centre as well as IT centres, and also upskill manpower. In railway safety, it aims to digitalise all data related to traffic safety, management, training, communications, analysis, accident warnings, and risk management. Regarding mechanics, VNR will invest in automation of manufacturing factories so as to develop into two modern manufacturing sites to assembly locomotives and railroad cars, and produce spare parts with localisation rate increasing to 50 per cent for locomotives and over 70 per cent for railroad cars. In terms of transport, the giant will increase connection with other means of transport such as road, sea, and air while ensuring rising application of technologies to ensure safety and increase service quality, administration, operation, and capacity. In spite of the moves, digital transformation in the railway sector faces a challenge in technology application due to underdeveloped infrastructure. Unlike other sectors, railways infrastructure has been downgraded in recent times. To deal with the problem, the Ministry of Transport in mid-May started a long-awaited VND7 trillion ($304.35 million) package to upgrade the North-South railway network. However, it will take the railway industry about two years to finish, meaning that the technology application for infrastructure cannot proceed right away. “The upgrading will be completed in late 2021. The railway industry will face difficulties to keep the frequency and capacity of train operation during the period,” VNR chairman Vu Anh Minh told VIR. “Even completed, technology application remains a hard task because of unsynchronous and not-modern-enough infrastructure.” According to the national railway development strategy, the industry is estimated to require VND110 trillion ($4.78 billion) by 2030 to revamp the existing network. With the limited state budget, calling for private investment is a priority. VNR is betting on its new restructuring plan which is set to be approved by the government in the near future, in which it plans to dump its monopoly in cargo transport by divesting stake in cargo transport. Moreover, it also hopes that the master plan on management, use, and operation of national railway infrastructure in line with 2018’s Decree No. 46/2018/ND-CP dated March 14, 2018 on management, use and operation of national railway infrastructure will be soon approved. This would enable the group to take the initiative with its investment plans and to be looked upon more favourably when calling for private investment in upgrading stations and logistics facilities, as well as developing stations that enjoy commercial advantages. Vietnam’s railway industry is attracting interest among international investors from the likes of Japan, France, China, Germany, and the United States, who are all seeking business opportunities in anticipation of huge future demands to upgrade and develop the system. VNN |
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Lychee production hubs seek to boost consumption amid export difficulty01:53 Việt Nam’s lychee production hubs in the North have entered the early harvest season this year and are preparing plans for its flagship fruit consumption amid export difficulties due to the COVID-19 pandemic.  A farmer harvests early maturing lychees in Lục Ngạn District, Bắc Giang Province. - VNA/VNS Photo On total cultivation areas of more than 28,100ha, Bắc Giang Province expects to harvest 160,000 tonnes of lychees this year, up 10,000 tonnes over 2019, of which 45,000 tonnes are early maturing lychees collected during May 20 and June 10. The main crop is scheduled for harvest between June 10 and July 10 with an estimated volume of 115,000 tonnes. In the 2020 crop, the cultivation area produced by VietGAP standards in the province has reached 15,000 hectares with estimated output of 110,000 tonnes, accounting for more than 50 per cent of the total cultivation areas and 68.7 per cent of total output. In previous years, about 50 per cent of lychee production used to be consumed locally while another 50 per cent was exported, mainly to China. However, the export of the fruit this year is expected to decrease due to the pandemic, especially when China also increased its cultivation areas. Bắc Giang Province has prepared specific plans and scenarios for promoting local fruit consumption, targeting local consumers and diversifying export markets to Japan, the United States, Australia, Europe and ASEAN countries besides China. The province will organise an online promotion conference on a national scale on June 6 with attendance of leaders of many ministries, representatives of foreign embassies in Việt Nam and corporations and distribution businesses. The provincial Department of Industry and Trade said that large distribution groups such as Aeon, Central Group and Mega Market have worked with local lychee traders in Bắc Giang for the signing of purchasing contracts. These groups will also help export local lychees to Thailand, Singapore, the US and the EU. In addition, 28 other distribution companies, six wholesale markets, and 31 enterprises and cooperatives both in and outside the province have registered to consume this season’s lychees. For export, as of May 18, 250 Chinese traders registered to cometo Lục Ngạn District to buy lychees. Besides, Bắc Giang authorities have coordinated with the Plant Protection Department to ask the Japanese side to approve 19 cultivation area codes covering an area of 103ha to be able to export the first batch of fresh lychees to Japan by the end of this month. Meanwhile, Hải Dương Province is also ready for the early lychee harvest. Output of the Thanh Hà District is estimated to reach 35,000 tonnes this year with quality expected to be better than last year. The province is also seeking to increase consumption in the local market through sales to supermarkets and agricultural product processing companies to offset the declining demand from oversea markets, especially China. According to Hoàng Thị Thúy Hà, vice chairwoman of the Thanh Hà District People's Committee, the district will continue working with local departments to invite businesses and traders to the locality to buy lychees. Although exports will be difficult due to the pandemic, consumption of lychees will not be in trouble if it takes full advantage of the domestic market, she said. Many businesses have visited and surveyed lychee gardens such as Big C, Thuận Thiên Investment and Development Joint Stock Company, Ikon Food and Biggreen Vietnam. Companies such as Hải Dương Agricultural Products and Foodstuff Joint Stock Company, Hà Nội Trade Corporation (Hapro) and other supermarkets such as Co.opmart, Vinmart and Intimex also have plans to buy local lychees. VNS |
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Ministry to help local firms cope with trade remedies 02:01 The Ministry of Industry and Trade (MoIT) is planning to increase the number of training courses on trade remedies for the domestic production industry.  Aquatic products processed for exports at Ba Ria - Vung Tau Seafood Processing Import Export Co (Photo: VNA) The Ministry of Industry and Trade (MoIT) is planning to increase the number of training courses on trade remedies for the domestic production industry. The idea is to improve the ability of domestic producers to cope with the application of trade defence measures on the global market. At the same time, the ministry will also provide information about current trade remedies for domestic associations and production industries. This will include guidance on using or dealing with trade remedies for key industries such as steel, wood, seafood, chemicals, textiles and support industries. The ministry will also build an electronic portal to provide early warnings about trade remedies, while looking at how these industries deal with trade remedy lawsuits. In addition, it will simplify the implementation of regulations on trade remedies to help Vietnam join the EU-Vietnam free trade agreement (EVFTA). The implementation of these solutions in the coming years is expected to help domestic production industries and enterprises, especially small and medium sized ones, to have clear information about trade remedies so they can improve the efficiency of their international economic integration. Le Trieu Dung, Director of the Ministry of Trade and Industry’s Trade Remedies Authority of Vietnam, said for FTAs with very high tariff reduction levels such as the EVFTA, there would certainly be high competitive pressure and challenges for Vietnamese enterprises. Most trade remedies in the EVFTA are based on the World Trade Organisation (WTO) rules. In addition, the EVFTA included principles that suited Vietnam's legal system. That would help Vietnam's production industries and businesses to adopt legal trade remedy tools and ensure economic efficiency when the country joined the EVFTA, Dung said, In addition, they needed to regularly monitor and study early warnings for trade remedies to take suitable actions to deal with them, he said. According to the Ministry of Industry and Trade, some sectors with large export volumes such as agricultural products, fisheries, textiles, footwear, iron and steel may be at higher risk of facing trade remedies. Trade remedies such as anti-dumping, anti-subsidy and safeguarding measures are important legal tools that protect local industries and enterprises, especially when tariff barriers are removed under international commitments./. VNA |
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BUSINESS NEWS HEADLINES MAY 2603:02Banks urged to promote digitalisation
The COVID-19 pandemic has caused a serious effect to the economy, but it has helped accelerate the race for banks to go digital. With many people looking for new options to deal with their financial affairs, digitalisation of services and e-payments are becoming crucial. Vu Tien Loc, chairman of Viet Nam Chamber of Commerce and Industry (VCCI) told an online forum held in Ha Noi yesterday there can be positives to take from the pandemic. “COVID-19 has been a catalyst that helps Viet Nam accelerate digitalisation of the economy, businesses, banks as well as e-commerce,” Loc said. Statistics showed the country now has 70 credit institutions and intermediaries unit such as E-wallets providing payment services online and through cell phone apps. The total value of digital financial transactions topped VND7.3 quadrillion and 300,000 transactions via mobilephone so far. Although there has been progress building a legal corridor for digital payment services, there were still obstacles in place. These have deterred digital payments from expanding quickly and easily to customers who prefer convenience, he said. The Decision No 645/QD-TTg on the overall plan of the national e-commerce development in 2021-25 period targets to have 55 per cent of the country’s population shopping online and 50 per cent of small-and-medium sized enterprises having business activities on e-commerce floors by 2025. The targets required determination from firms and banks in promoting digitalisation and non-cash payment. Pham Tien Dung, director of the Payment Department under the State Bank of Viet Nam (SBV) said the current policies have lagged behind the technology development. To promote digital economy, banks should find ways to bring ordinary users to become their digital customers. To support banks, the SBV recently drafted a regulation on opening accounts by the electronic system, Know your customers (eKYC). Banks must increase customer experience to make them satisfied with products and services. The central bank was expected to submit a decree to replace the Decree No 101/2012/ND-CP on non-cash payment in June. This would see Viet Nam having a definition for electronic money and correspondent banks for the first time. This is the basis for banks to develop comprehensive digital banking. Dung said in recent years, many digital banks have developed strongly, helping to improve operational efficiency. For example, a traditional bank processing credit files for businesses takes about a week, the digital bank can disburse for businesses in around two hours by digitising all the data, using public credit appraisal technology. “The growth rate of mobile banking in our country was 200 per cent, showing that we are growing very well. On average, there were 30-50 million transactions through the payment system,” he added. However, the SBV also said that the biggest barrier of digital banking development is still habit and a push is needed to change people's mindsets. He said banks need to build a smart and diverse ecosystem to develop digital banking. In digital banking and payments, it is impossible to mention the co-operation between banks and fintech. Currently, 81 per cent of credit institutions choose the co-operation model between banks and fintech for mutual development. In addition, banks must also strengthen integration, connectivity of infrastructure and applications of the banking industry with other industries and services to expand the digital ecosystem. Sharing ideas, Huynh Ngoc Huy, chairman of LienVietPostBank said Government should quickly build a national database, especially personal identification for sustainable development of digital banks and e-payment system. “When building digital banking, it is important to have cryptocurrencies and a national database of residents. If we can't connect to the national database of the population, we can't identify it. Therefore, the Government should immediately implement this because this is the root of the problem, through which we will apply a lot of things, including digital banking development,” Huy said. Investors consider Vietnam as safe investment destination after COVID-19 Many investors have considered Vietnam as a safe investment destination with a lot of advantages after the COVID-19 pandemic is pushed back, heard a meeting of permanent government members chaired by Prime Minister Nguyen Xuan Phuc in Hanoi on May 22. The meeting also saw the attendance of leaders from several ministries, sectors and provinces and cities which have attracted large sums of foreign direct investment (FDI), and economic experts. According to experts, the investment flow is expected to be poured into four industries: information technology and high technology, electronic equipment, e-commerce and logistics, consumer goods and retail. Therefore, localities should recognise and seize this opportunity to draw investment. PM Phuc said Vietnam has achieved initial successes in fighting COVID-19, but it is necessary to focus on developing the country to realise the dual target of preventing the pandemic and boosting socio-economic development. The PM asked the participants to deliberate concrete measures to optimise the investment flow shifted to Vietnam, especially from major multinational groups and high-tech firms. He suggested attracting selective projects, aiming at big multinational groups utilising new cutting-edge and environmentally friendly technologies. The Government leader requested building a project to address bottlenecks for investors such as land clearance and human resources. He agreed on the establishment of a working group in charge of this matter, which is headed by the Minister of Planning and Investment. Emphasising the role of the communication work, PM Phuc suggested promoting Vietnam as an attractive investment for investors and tourists. The Government, localities and sectors must create optimal conditions in terms of production premises, necessary and attractive incentives, administrative procedures, and human resources, he said. Attracting foreign investment with high-tech and high added value projects is an essential trend, the PM said, adding that authorities should make it easier for all economic sectors, particularly the private one, to successfully do business in Vietnam./. WB: Indonesia may lose market confidence due to debts The World Bank (WB) has called on the Indonesian government to formulate a sound fiscal strategy to “flatten the debt curve” and maintain financial market confidence as debt mounts amid the COVID-19 pandemic. Indonesia’s debt-to-gross domestic product (GDP) ratio would rise to 37 percent this year from 29.8 percent last year, driven by an increase in borrowings to cover for the widening budget deficit and to cope with the economic slowdown and rupiah exchange rate depreciation, according to WB senior economist for Indonesia Ralph van Doorn. The Indonesian government should provide assurances over its fiscal strategy to raise revenues back to at least the 2018 level to flatten the debt curve, he said, adding the country risked losing market confidence over its mounting debts. He also suggested Indonesia show a credible path for the economy to unwind exceptional measures taken by the government to battle the pandemic. Indonesia’s budget deficit is expected to increase to 6.27 percent of its GDP this year, more than double the initial ceiling of 3 percent, The WB has projected zero percent growth for the Indonesian economy under the baseline scenario. However, the economy may contract 3.5 percent under the worst-case scenario./. Laos not immune to global economic crisis: WB Laos’ economic growth is projected to decline in 2020 due to the impact of the COVID-19 pandemic and measures to contain its spread, unveiled a World Bank report on the country’s growth and debt in the year. The pandemic will have a significant impact on various sectors of Laos, particularly tourism, trade, investment and remittances, it said. Lao economic growth is projected to decline to 1 percent in the baseline scenario and negative 1.8 percent in a worse-case scenario. The economic downturn has particularly affected the service sector. A sharp drop in the performance of the travel, tourism and hospitality sectors – which account for 11 percent of total employment and 22 percent of employment in urban areas – has caused widespread job losses. Between 96,000 and 214,000 additional people are estimated to fall into poverty as a result of the pandemic. The impact of the COVID-19 is also projected to increase the fiscal deficit in 2020 to between 7.5 and 8.8 percent of GDP, from 5.1 percent in 2019. Consequently, debt levels are expected to increase to between 65 and 68 percent of GDP in 2020, from 59 percent of GDP in 2019. Reserve buffers are expected to fall in 2020 and cover less than one month of imports. The report also includes a thematic section on Building Resilient Health Systems. Evidence shows that Laos needs to invest more in building a resilient health system to effectively respond to health emergencies. At the same time, it is important to ensure that adequate resources continue to be available to provide quality essential health services to all citizens./. Khanh Hoa launches programme to stimulate tourism after COVID-19 A total of 74 firms will take part in a tourism stimulus programme in the south-central province of Khanh Hoa, offering deals with discounts of up to 50 percent, Director of the provincial Department of Tourism Tran Viet Trung told a press conference on May 22. The press conference was held by the province’s Departments of Tourism and Information and Communications and the Nha Trang - Khanh Hoa Tourism Association to launch the programme, which primarily sets its sights on domestic visitors. The move aims to help Khanh Hoa revive the local tourism industry, which has been majorly disrupted by the COVID-19 pandemic for nearly three months. Trung said participating companies, including 50 accommodation providers, 13 tourist sites, 10 tour operators, and a transport firm, have vowed to offer visitors discounts ranging from 20 to 50 percent. The province is calling on local tourism companies to develop new high-quality products and services to spark demand. The tourism department plans to hold promotional events in several domestic markets, such as Hanoi, Hai Phong, Ho Chi Minh City and Can Tho, while a seminar will be organised to seek solutions to improving the quality of tourism in Khanh Hoa. Khanh Hoa is home to over 770 accommodation providers with more than 42,000 rooms in total, including 86 hotels rated three to five stars with nearly 19,000 rooms. Because of the impact of COVID-19, the province expects to welcome just 3.2 million visitors this year, including 1.5 million foreigners. It received 7 million holidaymakers last year, including more than 3.5 million from overseas./. Thailand expects to harvest 24mn tonnes of rice in 2020 Thailand’s Royal Irrigation Department (RID) expects more rain this year and a harvest of 24 million tonnes of rice in the 2020-2021 crop. The Rice Policy and Management Committee believes that between November 2019 and April 2020, the Chao Phraya River basin will have 5.5 billion cubic metres of water, which would cover 59 percent of the country’s water supply. It decided to boost rice crops in the 2020-2021 period by allocating more than 9.5 million ha to the grain, including 4.4 million ha for jasmine rice, over 330,000 ha for Pathum Thani rice, more than 2.15 million ha for normal rice, 2.6 million ha for sticky rice, and about 90,000 ha for other types. RID Director General Thongplew Kongjan said this farmland is expected to produce up to 24.65 million tonnes. As the second-largest rice exporter in the world, behind India, Thailand expects to ship 7-8 million tonnes worth 4.2 billion USD this year - the lowest level in seven years./. Da Nang working hard to accelerate post-pandemic economic recovery Authorities in the central city of Da Nang have adopted a series of measures to bolster its post-pandemic economic development, focusing on attracting investment, promoting production, business, and exports, stimulating domestic tourism and consumption, and addressing difficulties facing key projects. Secretary of the municipal Party Committee Truong Quang Nghia said the municipal People’s Committee and relevant agencies have been directed to effectively implement support policies to promote production and business activities, accelerate the disbursement of public investment, and ensure social security. He urged the People’s Committee and relevant agencies to actively propose major targets and budget balance plans for 2020 while focusing on building socio-economic development plans and medium-term public investment plans for the 2021-2025 period. Nghia stressed the need to complete adjustments to the general planning of Da Nang city by 2030 and vision to 2045, and design an economic development strategy to 2030. Da Nang plans to submit a resolution on the pilot of organising the urban administration model as well as specific mechanisms and policies for Da Nang city to the National Assembly for approval, he said. Nghia also asked for solutions to quickly support and remove difficulties facing key industrial sectors such as automobile manufacturing, the rubber industry, and electronic components. It is necessary to build plans and scenarios and mobilise resources to recover the tourism sector, he said. The COVID-19 pandemic has had an impact on Da Nang’s economic indicators. In the first four months of this year, the number of tourists to the city and tourism revenue fell 57.6 percent and 51.2 percent, respectively. The total retail sales of goods and services was down 6.8 percent, while export turnover fell 8.4 percent./. Vietnam records trade deficit in first half of May as exports drop Vietnam reported a trade deficit of nearly 1 billion USD in the first half of May as exports reached only 8.22 billion USD – the lowest level since the beginning of this year (excluding the first half of January when the Tet holiday fell on), the General Department of Customs announced has announced. Only two groups of products posted an export turnover of at least 1 billion USD during the period including computers, electronics and components at some 1.5 billion USD and telephones and parts at 1 billion USD. That brought export earnings of these products total to 13.6 billion USD and 16.4 billion USD, respectively so far this year. Several other staples with an encouraging export value were textile and garment with 828 million USD, totalling 9.47 billion USD to date this year; machinery, equipment and parts with 753.5 million USD, totalling more than 7.5 billion USD and footwear with 587 million USD, totalling 5.94 billion USD. Meanwhile, the country imported nearly 9.2 billion USD worth of goods in the first half of May with computers, electronics and components and machinery, equipment and parts recording respective earnings of 2.1 billion USD and 1.4 billion USD, according to the department. Since the beginning of this year to mid-May, the nation’s trade value hit about 177 billion USD. Of the total, more than 89 billion USD came from exports while the remainder of 88 billion USD from imports. That resulted in a trade surplus of more than 1 billion USD, the department noted. The Ministry of Industry and Trade predicted that Vietnam’s export value would increase again in the second half of this year if the pandemic was controlled in the second quarter. The ministry would continue to give priority to promoting trade connections between Vietnamese enterprises and foreign partners, and the introduction of made-in-Vietnam goods to domestic and international consumers. Vietnam has set a goal of reaching 300 billion USD export value target by the end of this year after four-year trade surplus record. Last year, the country’s trade surplus hit a record high of 9.9 billion USD, the highest level seen in the past four years./. Thailand promotes airport city project in Eastern Economic Corridor The Eastern Economic Corridor Policy Committee of Thailand has agreed with a draft contract on the 290-billion-baht (over 9 billion USD) eastern airport city project at U-tapao airport. Local media on May 22 reported that the project is one of five megaprojects under the government's infrastructure development in the Eastern Economic Corridor (EEC). As scheduled, after the draft contract is approved by the Thai cabinet, the country’s navy will sign a 50-year contract with the BBS consortium to implement the project. Covering an area of more than 10sq.km, the project includes a third passenger terminal at U-tapao airport, a commercial gateway and a ground transport centre, an MRO (maintenance repair and overhaul) centre, a cargo complex and an aviation training centre. It is expected to earn the government 305 billion THB from land lease and revenue-sharing and 62 billion THB from tax. In the first five years, the project will create 15,600 jobs. Kanit Sangsubhan, the EEC Office's secretary-general, said the project will be completed in 2023 along with the high-speed railway linking the three key airports of Don Mueang, Suvarnabhumi and U-tapao./. Indonesia, RoK sign MoU on oil and gas cooperation Indonesian energy producer, PT Pertamina, and a consortium of companies of the Republic of Korea (RoK) signed a memorandum of understanding (MoU) to explore business cooperation opportunities in Indonesia’ oil and gas industry, specifically in the Refinery Development Master Plan (RDMP) of Dumai in Riau. The signing was carried out online on May 20, witnessed by head of the Investment Coordinating Board Bahlil Lahadalia. The state construction firm, PT Nindya Karya, also involved in the deal while the Korean consortium was represented by DH Global Holdings Co. Ltd. The 1.5 billion USD project is expected to increase domestic oil and fuel production capacity, reduce the reliance on oil imports and address the current account deficit in the future, said Lahadalia in an official statement released on May 21. The deal is accordance with the Indonesian Government’s efforts to support the acceleration of the implementation of mega projects under the National Strategic Projects. Pertamina Director, Ignatius Tallulembang, said the third parties will conduct a study on upgrading the Dumai Refinery, expressing his hope that there will be an important milestone in December. Pertamina aimed to double its capacity to 2 million barrels per day, produce environmentally friendly fuel products of the Euro5 standard and petrochemical products./. Bac Giang to host lychee trade promotion teleconference next month The northern province of Bac Giang will host a teleconference on June 6 to promote the domestic consumption and export of lychee, a local specialty, as the harvest season has just come. The video conference will connect representatives from the Government Office, the Ministry of Agriculture and Rural Development, the Ministry of Industry and Trade, trade offices and embassies in Vietnam of China, Japan, and Thailand, leading local and foreign retailers such as Aeon, the Central Group, Mega Market, Saigon Co.op, Hapro and Vinmart, and a number of major wholesale markets and distributors. It is part of a series of promotional events Bac Giang is holding to boost sales of lychee. Luc Ngan and Tan Yen districts, home to the largest lychee areas in the province, will prepare a list of foreign wholesalers who have demand for lychee and ask authorities to allow their entry into Vietnam to purchase the fruit. They will also formulate plans to quarantine these traders, in line with regulations. Bac Giang currently has more than 28,100 ha of lychee, with output likely to increase 10,000 tonnes to 160,000 tonnes this year. This includes 45,000 tonnes of early-ripening lychee harvested on an estimated area of 6,000 ha and 115,000 tonnes of lychee from the main crop on an area of 22,100 ha. The harvest is expected to last until July 10. VietGAP-standard lychee has been grown on 15,000 ha this year, or half of the province’s total area. Output is forecast at 110,000 tonnes, or 68.7 percent of the total. Bac Giang has developed different plans and scenarios for lychee trade promotion this year in response to the COVID-19 outbreak, which is still ravaging many countries around the world. It has set its sights on several main markets, such as Japan, the US, Australia, the EU, and China. Japan has approved a total of 19 Production Unit Codes (PUCs) for 103 ha of lychee in the province, including 98 ha in Luc Ngan and 5 ha in Tan Yen. The province has also received 18 PUCs for 218 ha of lychee in Luc Ngan’s six communes for export to the US, Australia, and the EU./. Asian Banker names Techcombank best bank for SMEs in 2020 The Vietnam Technological and Commercial Joint Stock Bank (Techcombank) has been named 2020 Best Solutions Provider for Small and Medium-sized Enterprises (SMEs) by prestigious magazine The Asian Banker. The magazine said the bank has solidified its position as a one-stop solutions provider for SMEs in Vietnam with a value chain-focused strategy and business model. Head of Research and Survey at The Asian Banker, Mobasher Kazmi, said leading experts have been impressed by the bank’s deep customer insight in addressing the evolving needs of SMEs, which led to its strong income and profit growth in 2019. The bank has targeted the six consumption-led economic sectors that contribute almost half of Vietnam’s GDP. Vishal Shah, Head of Techcombank’s Business Banking Division, said that within its growing footprint of more than 300 branches nationwide, Techcombank has enabled a dedicated business unit focused on SMEs and mid-corporate businesses through 43 dedicated branches. He added that the bank continues to upgrade its Fast E-Bank online banking platform to improve customers’ experience in terms of speed, convenience, efficiency, and security. It also introduced Overseas Remittance-embedded Foreign Currency Exchange with enhanced functionalities to support internal customer control and risk management. The bank also launched a preferential loan package of 20 trillion VND (869 million USD) to businesses affected by COVID-19./. EVN calls for investment in solar power plants on reservoirs Electricity of Vietnam (EVN) is seeking investors in new electricity projects, including solar power plants on reservoirs, in an effort to ensure the safe and stable operation of the country’s electricity market. Home to nearly 7,000 reservoirs covering millions of square kilometres, Vietnam has the conditions necessary to develop solar power plants on water surfaces, with total capacity amounting to 15,000 MW. According to Deputy Minister of Agriculture and Rural Development Nguyen Hoang Hiep, the Ministry has received numerous proposals for solar power plants on reservoirs over the last three months. The 420 MWp solar power plant in the semi-flooded area of Dau Tieng Reservoir in southern Tay Ninh province and another with a capacity of 47.5 MWp on the Da Mi Reservoir in south-central Binh Thuan province are the first of their kind in the country and are operating successfully. These projects have safely churned out commercial electricity for the national power grid, said Nguyen Dinh Chien, Deputy Director of the Da Nhim-Ham Thuan-Da Mi Hydropower JSC in Binh Thuan. According to Hoang Tien Dung, Head of the Ministry of Industry and Trade (MoIT)’s Electricity and Renewable Energy Authority, as at May 11, 6,000 MW of solar and wind power had been turned out commercially. Some solar and wind power plants have been transferred partially or fully to foreign investors from Thailand, the Philippines, and China, he added. Regulations allowing private and foreign investors to engage in electricity development without Government guarantee have made the sector more appealing to investors. Under its production and business plan for 2016-2020, EVN is to diversify the mobilising of capital at home and abroad and effectively use State budget funds for site clearance in service of power projects. EVN Director General Tran Dinh Nhan said the group will continue to coordinate with relevant ministries and agencies to accelerate the capacity release of the solar power projects, which are scheduled to be completed in the third quarter of this year. In climate change-hit Tiền Giang, rice farmers switch to fruits, vegetables More rice farmers in the Cửu Long (Mekong) Delta province of Tiền Giang have switched to other crops as part of efforts to adapt to climate change. In Cai Lậy and Cái Bè districts in the upstream area of the Tiền River, a tributary of the Mekong, they either switched completely or rotated rice with other crops in the ongoing 2019 -20 dry season, according to the provincial Department of Agriculture and Rural Development. Cái Bè now uses more than 5,300ha of low-yield rice paddies to grow speciality fruits and rotates vegetables and rice on another 1,200ha. Phạm Văn Thanh, head of the Cái Bè Bureau of Agriculture and Rural Development, said farmers had grown many high-value vegetables like bitter gourd, cucumber and onion. They have short growing periods and high yields, and require less water and offer higher profits than rice, according to Thanh. Farmers who grow vegetables in the two districts earn three to five times more than from rice, according to the department. Trần Lý Ngự Bình, head of the Cai Lậy Bureau of Agriculture and Rural Development, said to enable rice farmers to switch to other crops, the district has upgraded irrigation canals and built new ones to ensure sufficient water. Cai Lậy has invested more than VNĐ29.6 billion (US$1.3 million) so far this year in 67 irrigation projects. Cái Bè has spent more than VNĐ56 billion ($2.4 million) to build 167 irrigation projects, dredge canals and upgrade sluices to keep out saltwater. Affected areas Drought and saltwater intrusion have affected nearly 60,000ha of crops in the 2019 -20 dry season in the province’s western region, which includes the two districts and Cai Lậy Town. They include more than 23,000ha of rice and 36,000ha of speciality fruits. Besides improving irrigation facilities, the localities have also installed water salinity testing devices along rivers. The Cái Bè District People’s Committee has installed 25 of them in communes along the Tiền River to measure salinity on a daily basis. Communes and farmers have hundreds more of the devices. In Cai Lậy, in areas that lack saltwater prevention dykes, authorities have told farmers how to store water and keep out saltwater in the Hàm Luông River, one of the province’s largest. Authorities regularly provide information about saltwater intrusion and the schedule for opening and closing sluices to farmers so that they know when to draw water from rivers and canals for irrigation. The province has transported water from other places to save speciality fruit crops, which are facing a severe shortage of water due to drought and saltwater intrusion. Around 2,275ha of fruit orchards have been affected by the water shortage, with 2,186ha being damaged by 30 – 70 per cent and the rest by more than 70 per cent. Tiền Giang, the country’s largest fruit producer, has more than 77,700ha under fruits, which include specialty fruits like Lò Rèn milk apple, Hòa Lộc mango, Ngũ Hiệp durian, and Chợ Gạo dragon fruit. The province grows more than 1.5 million tonnes annually. VPBank to sell 17 million treasury shares to employees The Viet Nam Prosperity Joint Stock Commercial Bank (VPBank) will sell 17 million treasury shares for current employees in 2020, worth a total VND170 billion (US$7.31 million). The issuance, which accounts for 0.67 per cent of its total shares, would be submitted to its annual shareholder meeting, scheduled to be organised on May 29, for approval. The shares, with a price of VND10,000 each, will be restricted from trading for three years, the bank said in a document sent to shareholders. However, the management board could decide to loosen the restricted time for transfer depending on human resource policies. Thirty per cent of the shares will be restricted from trading for one year. Thirty-five per cent of the shares will be available for trading after two years and shareholders will be able to trade the remainder after three years. The issuance was expected to be implemented in the third quarter of this year. VPBank targeted to increase its total assets by 12.7 per cent to VND425.1 trillion in 2020, customer deposits and valuable papers planned to reach VND299.7 trillion, an increase of more than 10 per cent and an outstanding loan of VND304.7 trillion, an increase of 12 per cent. The bank also targeted before-tax profit of VND10.2 trillion, down 1.1 per cent compared to 2019 while non-performing loans (NPL) ratio would be under 3 per cent. The bank’s leaders said they have seen positive business results in terms of credit growth, revenue and consolidated profit despite the affects of COVID-19. VPBank expected that the banking sector would regain its growth by the end of second quarter this year while the pandemic is under control, pushing recovery of production and business activities. The bank planned to not pay dividends for 2019 to retain the capital for its business activities. At the upcoming shareholder meeting, VPBank would vote for its management board and Supervisory Board in 2020-25 period. The current members such as Ngo Chi Dung, Bui Hai Quan, Lo Bang Giang and Nguyen Duc Vinh would be still in the voting list. Nguyen Van Phuc, a member of the Independent Board of Directors would be a new candidate this term. Tiki commits to support VPBank’s business households E-commerce platform Tiki has become the fourth partner of VPBank to join the bank’s “Household Business Academy” programme, which enables business owners to conduct transactions via online channels in light of the social distancing order, as well as to maintain their revenue sources. Accordingly, Tiki would have consultants to support the first 200 household businesses participating into the programme and open an online shop at https://tinyurl.com/vpbank-tiki. The households would be given training on online trading on the e-commerce platform. In addition, they would also be offered preferential policies such as free designs of image and banners for ads, Tiki Ads and a livestream Tiki live advertising package. A Tiki representative said this e-commerce floor has seen strong growth in the first months of this year. It was estimated that there were 3,000-4,000 orders a minute at peak times on this platform. VPBank said the participation of Tiki in its programme has affirmed that digital transformation has been a vital trend for household businesses in the current context. The launch of its “Household Business Academy” programme has been in time to support the businesses overcome difficulties caused by COVID-19. “We expect that household businesses could take advantage of the support from e-commerce floors to have good results for their online trading,” he added. The pandemic has caused changes in consumers’ shopping habits, opening new opportunities for online trading. Statistics from the Ministry of Industry and Trade showed that revenue of traditional markets in Ha Noi was reduced by 50-80 per cent in the first four months of the year. Meanwhile, that from online shopping through e-commerce increased by 20-30 per cent. After a month of launching, the bank’s programme attracted participation of more than 12,500 household businesses nationwide. Hundreds of household businesses have successfully applied online sale skills. Earlier, three partners including Shopee, Sendo and Be also joined the programme. SSI asset management to IPO new fund by end of June SSI Asset Management Co Ltd (SSIAM) will launch an IPO for its exchange-traded fund ETF SSIAM VN30 between May 26 and June 29. The new fund mimics the movement of the large-cap tracker VN30-Index, which contains the 30 largest stocks by market value and trading liquidity on the Ho Chi Minh Stock Exchange (HoSE). The initial value of the fund is estimated at VND50 billion (US$2.13 million). SSIAM gained approval from the State Securities Commission for the IPO on Friday. SSI Securities (SSI), Mirae Asset Vietnam Securities and BIDV Securities are the managers of the fund, while the supervisor is the Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank). The ETF will be listed on HoSE following the offering. SSIAM VN30 ETF is the second fund that tracks the large-cap VN30-Index. The first is the VFMVN30 ETF managed by VietFund Management (VFM) with a total value of VND6 trillion ($255.75 million). According to SSIAM, the 30 stocks in the VN30 basket account for 73.4 per cent of total market capitalisation. Those stocks are also leading companies in their sectors. The new fund is expected to become a good-quality and low-cost option for investors. It will help increase capital flowing into investment funds and make investors pay more attention to fund certificates in addition to buying stocks. On March 18, SSIAM’s exchange-traded fund SSIAM VNFIN LEAD debuted on HoSE. Gelex CEO to raise ownership Chairman and CEO of the Vietnam Electrical Equipment Joint Stock Corporation (Gelex) Nguyen Van Tuan plans to up his stake in the company by 3.07 per cent. The firm’s CEO will buy 15 million shares from May 26 to June 24, equal to 3.0722 per cent of the company’s total outstanding shares. The company has recently announced a plan to sell its logistics arm in the third quarter of the year in an attempt to restructure its portfolio and focus more on electrical equipment and infrastructure sectors. Gelex has also decided to offload a 20.25 per cent stake in Dong Nai Port JSC. Gelex shares, listed on the Ho Chi Minh Stock Exchange with code GEX, gained 1.5 per cent to trade at VND17,150 (US$0.73) apiece on Friday. Shares have gained 14.3 per cent in the last three weeks. In January-March, Gelex earned VND3.5 trillion ($150 million) worth of net revenue, up 14.2 per cent on-year. But net profit dropped 43 per cent on-year to VND93.5 billion due to increased selling, financial and management expenses. MPI introduces state-of-the-art operating platform Viet Nam's Ministry of Planning and Investment (MPI) on Friday launched a cutting-edge integrated operating centre that is capable of collecting, analysing and disseminating information in the shortest time possible with the highest accuracy. Minister Nguyen Chi Dung said the centre was built to integrate existing databases of the ministry’s subsidiaries. It is expected to issue early and clear warnings, improve the country’s socio-economic landscape as well as enhance the MPI’s internal management. The centre uses information and analytical technology to assist policymakers to make timely decisions and respond to a wide range of issues, including those that have been anticipated and emergencies, according to Nguyen Nhu Son, director of the MPI’s IT Centre. Information is integrated from six national information portals on business registration, foreign investment, public investment, procurement network, investment management and statistical databases. “It can be viewed as the ministry’s “brain” which offers overviews and insights involving the MPI,” said Dung. The centre will continue bringing in other information systems and databases to track missions of the Government and Prime Minister, monitor public servants, manage dossiers and even hold teleconferences. HCM City-Vung Tau ferry service to be launched in September HCM City is set to launch a ferry route linking the city's Can Gio District and the popular beach city of Vung Tau in Ba Ria-Vung Tau Province from September. Bui Hoa An, deputy director of the municipal Department of Transport, said that the work on the project has mostly been completed for the operation scheduled to start from September 2. Six ferries will be used for the 15-km route which will take around 30 minutes. They can transport 350-500 passengers, 100 motorbikes and 20 cars and make 24 return trips a day. The proposed one-way ticket is VND50,000 (USD2.17) per person. The service will help to shorten the travel between HCM City and Vung Tau City. At present, the wharf construction is underway which is slated for completion for nearly one month to come. The ferry route is also expected to promote tourism in the HCM City’s coastal suburban district of Can Gio where owns great potentials for tourism development. According to experts, the ferry service will help to ease pressure on roads connecting HCM City and Vung Tau City, including the HCM City-Long Thanh-Dau Giay Expressway which often faces traffic congestion during holidays. Tran Song Hai, general director of Cong Nghe Xanh DP Ltd. Co. which operates the high-speed HCM City-Vung Tau catamaran said that the travel demand between the two cities has been on the rise. So, it is necessary to open the ferry route which can carry bulky goods. Solutions sought to turn Can Tho into centre of Mekong Delta region A seminar was held in Can Tho on May 23 to discuss measures to turn the city into a centre of the Mekong Delta region with sustainable development. Participants to the event analysed and assessed potential and advantages of Can Tho city as well as achievements made by the municipal authorities over the last 15 years. They proposed solutions, mechanisms and policies to remove bottlenecks, thus promoting rapid and sustainable development in the locality in the time to come. Addressing the seminar, head of the Party Central Committee’s Economic Commission Nguyen Van Binh stressed the need for Can Tho to take measures to adapt to increasing complicated climate change in the region. He said attention should be paid to promoting industry and service development, especially scientific and technological services in the fields of health, education and training, towards turning Can Tho into a centre of providing solutions on science and technology in all fields for the Mekong Delta region. Binh urged the municipal authorities to focus on upgrading and developing infrastructure systems, especially those serving transport, economic development, education, science and technology, and human resources training. Regarding agricultural development, Professor Vo Tong Xuan, principal of Nam Can Tho University, said the city needs to find big investors and businesses that are capable of seeking export markets for local agricultural products. He also underlined the importance to make planning on official agricultural growing areas to ensure the provision of materials for enterprises, while enterprises should cooperate with farmers to form production chains meeting new standards, thus producing clean materials to provide for businesses. Can Tho recorded stable economic growth in the 2006-2019 period, with an annual average growth rate of 7.23 percent, higher than the nation’s average growth. GDP per capita reached 88.3 million VND in 2019, seven times higher than that in 2005. The city has affirmed its central role in the Mekong Delta in some areas such as education - training, health, culture, science and technology, and social security. Indonesia to receive 56 million USD from Norway for reducing emissions Indonesia is set to receive a 56 million USD grant from Norway as the first payment for the Southeast Asian nation’s success in reducing deforestation and carbon emissions under the Reducing Emissions from Deforestation and Forest Degradation (REDD ) cooperation scheme. According to a statement from the Indonesian Environment and Forestry Ministry issued on May 21, the grant would be handed over in June – coinciding with the commemoration of a decade of climate funding cooperation in which Indonesia would receive a total of 1 billion USD for protecting its tropical forests. Indonesian Environment and Forestry Minister Siti Nurbaya said the grant was a result-based payment. “This is going to be the first payment for Indonesia’s achievement in its REDD effort during the period between 2016 and 2017,” The Jakarta Post newspaper quoted the minister as saying. The ministry reported to Norway that Indonesia saw a decline in the deforestation rate in the 2016-2017 period, with 480,000 hectares of forest lost that was believed to have prevented the release of about 4.8 million tonnes of carbon dioxide equivalent (CO2e) emissions to the atmosphere – a figure lower than the baseline agreed upon by both countries. According to the verification process conducted by the Norwegian government from November last year to March, the emissions reduction achieved by Indonesia in the 2016-2017 period was counted at 11.2 million tonnes CO2e – higher than its initial report of 4.8 million tonnes. According to Minister Siti, each tonne of CO2e under the scheme is valued at 5 USD, referring to the price designated by the World Bank for the REDD scheme. She said Indonesia expects to receive another round of payments for its progress in the 2017-2018 period and onward. The fund will be channeled through the Indonesian Environmental Estate Fund (BPDLH), a public service agency tasked with managing funds related to environmental protection and conservation. The agency was launched in October last year. The fund will be used to finance community-based environmental recovery efforts under President Joko Widodo’s direction. Cambodia’s bicycle export surges despite pandemic Cambodia’s export of locally-assembled bicycles has increased in the context that bicycle industries around the world rust during the ongoing COVID-19 pandemic. Local channel BTV News reported that Cambodia exported some 498,000 bicycles worth about 119 million USD in the first quarter of this year, 10 million USD higher than that of the same period last year. Cambodia Chamber of Commerce vice-president Lim Heng said exports of locally-assembled bicycles can only gain traction as traffic and health concerns force people to reconsider their primary means of transportation. Bicycle exports are expected to continue to increase in the second quarter when local people still avoid public transportation and need to use bicycles to exercise, said Heng. He highlighted that now is the opportunity to invest in bicycle assembly in Cambodia for export. According to the Royal Academy of Cambodia's economic researcher Hong Vanak, although some orders were cancelled in the first three months of this year because of the pandemic, Cambodia’s bicycle export is still a bright spot, making an important contribution to the national economic development. A report of the World Bank shows that Cambodia exported a total of 1.52 million bikes to the European market in 2018, raking in 331 million USD. Vietjet offers promotional tickets to celebrate Int'l Children's Day Vietjet is offering more than 2 million super-saver tickets priced from only 1,600 VND on all 45 of its domestic routes, the airline announced on May 24. The programme aims to celebrate International Children's Day on June 1 and Vietnamese Family Day on June 28. "This is a gift from Vietjet so children and their families can experience a joyful summer and connect in all parts of the country," Vietjet said in a statement. The tickets will be available between May 25 and June 1, 2020 on www.vietjetair.com and the Vietjet Air mobile app. The flight period will run from June 1, 2020 to December 31, 2020 (excluding national holidays). Earlier this month, the airline also launched a promotional campaign with more than 200,000 tickets priced at zero VND on all routes until June 30. From now until June 30, each Vietjet flight will have 25 seats at a price of zero VND (excluding taxes and fees) for travel companies, with the others available for purchase by individuals, the airline said. With 45 domestic routes covering the country and an on-time performance rate of 97.4 percent, Vietjet is in position to stimulate domestic tourism and create favourable conditions for people to travel after the COVID-19 pandemic. VNN |
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BUSINESS NEWS HEADLINES MAY 2702:17Exports shrink to lowest in first half of May Exports totalled 8.22 billion USD in the first half of May, the lowest recorded on a fortnightly basis since the beginning of this year excluding the last two weeks of January when the Tet holiday took place. According to the Ministry of Industry and Trade, sharp declines have been seen in a number of key export items, such as phones and parts, down 16.9 percent, and machinery, tools and components, down 14.5 percent. Meanwhile, imports rose 1.9 percent to 9.2 billion USD during the period. The COVID-19 pandemic has caused disruptions to global supply chains, considerably affecting Vietnam’s import and export import activities, the ministry said. Foreign trade will bounce back in the second half of 2020 if the disease is brought under control by the end of the second quarter, it added./. Vietnam – emerging tiger in Asia: Egyptian media In the economic aspect, The Egyptian Gazette noted Vietnam is viewed as an emerging tiger in Asia with a GDP growth rate of over 7% in 2019, annual per capita income approximating US$2,800, and household poverty rate brought down to 1.45%. Regarding the fight against the COVID-19 pandemic, the newspapers said the UN and many countries around the world have expressed their admiration for Vietnam’s accomplishments. In terms of bilateral cooperation, the Egyptian media highlighted that the two countries have enjoyed new strides in their relations in multiple spheres and at different levels. As the ASEAN Chair this year, Vietnam can act as an important bridge linking Egypt with other ASEAN members, thereby helping the Egyptian Government promote its “Look East” policy, the newspapers noted./. Vietnam needs to change its ways to attract FDI: experts Vietnam has some great advantages while competing with regional countries in attracting capital flows after the COVID-19 pandemic, experts have said. A report by SSI Research said foreign projects set up in industrial parks in the country were up 32 percent year-on-year in the first four months of the year to 9.8 billion USD. The pandemic has shown that many large countries’ supply chains are heavily dependent on China, and they have taken drastic steps to cut this dependency. Many large US, Japanese and European companies are gearing up to shift production away from China. Vietnam is one of their destinations besides some others in the region such as Indonesia, Thailand and Malaysia. "Compared to Indonesia, which directly competes with Vietnam in attracting FDI, Vietnam has the advantage of proximity to China,” the report said. “Vietnam also offers support to businesses, with many incentives for large FDI projects, and has a lot of free trade agreements in which Indonesia does not participate. Recently the Vietnamese dong has been very stable compared to the Indonesian rupiah." Nguyen Van Toan, Vice Chairman of the Vietnam Association of Foreign Investment Enterprises, said the opportunity to attract the FDI wave looking to relocate from China is quite clear, but not really big, and whether the opportunity can be grasped depends largely on Vietnam. "We also need to be aware that investors will not easily pull out all investment from China because that country has great advantages such as a strong work force, good use of technology and products for all market segments, not just the affordable segment." Vietnam would face difficulties in competing with so many rivals to attract a part of the capital flows moving out of the neighbouring country, he said. Experts agreed that to compete in the race, the country would need to change its way of attracting FDI and quickly. Phan Huu Thang, former Director of the Foreign Investment Agency, said, “[We] will fail if we try to attract foreign investment in the traditional way. “For example, India has immediate policies to allocate land, prepare infrastructure, identify potential investors to approach, announce tax reduction plans ... Investors are gearing up to shift their production. If we continue to act slowly, we will miss an opportunity that comes once in 100 years.” Toan said Vietnam needed to further improve its business and investment environment and administrative procedures. He believed that HCM City, which leads the country in FDI attraction, has all the conditions and capacity required to make good use of this opportunity./. Survey finds high domestic travel demand until year end Close to 85 percent of respondents have said they have plans to travel from now until the year end, a survey by the Vietnam Tourism Advisory Board (TAB) has found. Among them, 49.3 percent will travel for 2-3 days, 10.7 percent want to take a holiday longer than 7 days and 2.4 percent will go on a one-day tour, according to the survey. Some 60.5 percent of the respondents said they plan to travel with their families, 29.1 percent will go with friends while 6 percent want to travel alone. A majority, 51.7 percent, want to travel by plane while 20.3 percent said they will use their own cars. The survey said that the most popular destinations were seaside resorts, followed by mountain resorts, eco-tourism sites and cities./. Vietnam, China works to fuel agricultural trade Vietnam and China are going to hold several teleconferences in the next few days to promote the trade of agricultural products and specialties. The Ministry of Industry and Trade (MoIT) said on May 24 that its Trade Promotion Agency and the Vietnamese trade office’s branch in China’s Kunming city will coordinate with the Yunnan branch of the China Council for the Promotion of International Trade to hold a teleconference on May 26 and 27 to boost the trade of agricultural products and food between the two countries. During the talks, 21 Vietnamese businesses operating in the agricultural, fisheries, food processing and beverage sectors will introduce their products to Yunnan importers. Do Quoc Huong, who is in charge of the Vietnamese trade office’s Kunming branch, said all production and business activities in Yunnan province have been basically resumed, but agricultural production there is still facing difficulties. The Yunnan Department of Commerce predicted that from now to the end of June, the province will have a high demand for essential farm produce like fruit and vegetables. The MoIT and the Ministry of Agriculture and Rural Development of Vietnam also noted that a major international meeting will be held online on June 6 to promote lychee trade between the two nations. It will connect tens of locations in Bac Giang, Lao Cai, Lang Son, Da Nang and Ho Chi Minh City with those in China’s Yunnan and Guangxi provinces. Data from the MoIT show that bilateral trade hit more than 35 billion USD in the first four months of this year. Vietnam earned 12.7 billion USD from exports to China and purchased goods worth 22.38 billion USD from the neighbouring market, respectively rising 22.1 percent and falling 1.6 percent year-on-year./. Local firms urged to diversify markets, understand post-pandemic trends Vietnamese firms need to diversify their overseas markets and improve their strengths to capitalise on opportunities after the COVID-19 pandemic ends, a recent online seminar heard in Ho Chi Minh City. Pham Chi Lan, an economist who was an advisor to the Government in the past, said firms would need to join hands with industry business groups to study new market trend and changes in consumer habits after the pandemic to identify large and niche markets and reshape their business strategies. “The market will never return to the old normal that existed before the pandemic but to a new normal. New normal will have new abnormalities. Therefore, research should be conducted. “Businesses that are in associations should sit together to discuss what they can do and should not wait for the Government. Based on their requirements, they can propose policies.” Nguyen Thi Thu Trang, Director of the Vietnam Chamber of Commerce and Industry’s WTO and Integration Centre, said: “The demand for IT products will increase to meet the new way of working. Demand for green products will be further boosted. After the end of social distancing, there will be demand for products and services that were not available before. “This is a change in consumption trends as people realised what is essential for life when they stayed at home. “If we want to seize the opportunity, we will have to change too.” Vietnam’s exports depend on two factors: global demand and competition with similar products, according to Trang. Demand is very low, leading to a reduction in the exports of many products in the second quarter. But Vietnam still has a chance to promote exports. Firstly, during the epidemic, Vietnam improved its reputation by controlling the epidemic well and donating face masks and other medical stuff to support its partner countries. Secondly, demand for items such as food, medical supplies and computer equipment in which Vietnamese firms have export strengths has increased globally. “The EU-Vietnam Free Trade Agreement, which will come into effect this year, also offers opportunities for Vietnamese firms to export to the EU,” she said. "The EU has over 400 million people and the second largest purchasing power in the world. Other major exporting countries to the bloc, such as China and Thailand, do not have FTAs with it," she pointed out. She said local firms should pay more attention to their domestic market. “Vietnamese enterprises should promote exports but meanwhile increase consumption in the domestic market.” Lan said Vietnam should continue to develop sectors such as medical products and pharmaceuticals for both the domestic and export markets. Many countries were worried about another wave of the pandemic, and so demand for these products would still be high, she explained./. Former wife of Hoa Sen boss wants to sell entire HSG holding As soon as the performance of Hoa Sen Group (HSX: HSG) turned better, its chairman’s former wife has decided to sell her entire shareholding in the local steel giant. Hoang Xuan Huong, the former wife of Hoa Sen Group’s chairman Le Phuoc Vu, has just registered to sell her entire 7.15 million HSG stocks, equalling 1.54 per cent of the company’s charter capital. The transaction will take place under the form of private placement and auction. The trading timeline is from May 22 to June 20. Ending the session on May 20, its stock was at VND9,530 (41.43 US cents), down 1.75 per cent against the previous session. Based on this price, Huong may get nearly VND70 billion ($3 million) from the deal. Huong purchased the 7.15 million stocks in late 2018. In the same year, Tam Thien Tam One Member Limited Company (also operated by her) divested all 24.2 million HSG stocks. At the time, her company was a large shareholder of Hoa Sen Group. HSG stock rose from the bottom of VND4,330 (18.8 US cents) in late March this year to nearly VND10,000 (43.48 US cents) per share, the highest price from October 2018. Its stock was buoyed by many positive signs stemming from the steel company reaching about VND90 billion ($3.91 million) of after-tax profit in April. Accordingly, its accumulated losses during the first seven months of the fiscal year (starting in October) hit VND472 billion ($20.5 million), exceeding the target of VND400 billion ($17.4 million) for the 2020 fiscal year. Lao Cai launches promotion programme to boost tourism The northwestern province of Lao Cai organised a summer tourism promotion programme from May 22-24 with a view to luring holidaymakers to the locality in general and the resort township of Sa Pa in particular. As many as 82 local travel businesses were engaged in the programme, which covers special ticket discounts of 10-60 percent to tourist sites, while the quality of accommodation and catering services were enhanced. Fansipan Legend Cable Car Company of Sunworld Group is offering a 60 percent discount for tourists coming from the northwestern provinces of Lao Cai, Lai Chau, Son La, Dien Bien, Yen Bai and Hoa Binh. The preferential programme will run until June 28. Lao Cai aims to draw 2.5 million tourists in 2020. Due to the impact of COVID-19, the number of visitors to Lao Cai in the first five months of the year reduced 73.2 percent to 666,000./. Tien Giang to support tourism businesses hit by COVID-19 Local businesses hit hard by COVID-19 are seeking support, including deadline extensions for tax payments, from Tien Giang Province authorities. Nguyen Duc Dam, director of Tien Giang's Department of Culture, Sport and Tourism, said that more than 1,200 businesses, households and clubs in the fields of culture, tourism and sport had to stop operating due to COVID-19. In the first quarter, Tien Giang received only 375,000 tourists and reached VND160 billion in tourism revenue, a drop of 43 per cent and 50 per cent, respectively, year-on-year. Phan Hoai Lam, deputy director of Saigontourist's branch in the province, said that revenue had dropped drastically and there were no foreign tourists. Domestic tourism had just started to pick up, he added. Lam said his company was looking for tax reductions and extended deadlines for social insurance and VAT payments. Nguyen Thi My Trang, deputy director of Lang Viet Travel Co., Ltd, said she hoped that local authorities would lower land rent and insurance fees and extend payment deadlines. The Tien Giang Tourism Association has asked authorities to lower bank loan interest rates and extend payment deadlines. The association said that loans with low interest rates are needed for organisations in the fields of tourism, sport and culture. To help those businesses recover, reduction in land rent fees and extension of payment deadlines are needed as well. Nguyen Duc Dam said the department had been working with other agencies to carry out policies from the central and local governments to assist businesses affected by COVID-19. In the future, departments would develop a media campaign on safe travel to Viet Nam and Tien Giang to encourage tourism. The province would also help businesses improve tourism products and build tourism stimulation programmes. Dam said that tourism businesses should provide newer tourism products and services, and that departments should focus on promoting tourism and work cooperatively with HCM City, Ha Noi and Mekong Delta provinces. VietinBank plans equity capital increase from accumulated profits VietinBank (VTG) planned to increase its equity capital from its accumulated profits or paying dividend by stocks. The plan is being completed by the competent State agencies to complete the legal procedures for implementation. Le Duc Tho, chairman of VietinBank’s Board of Directors, made the statement at its 2020 annual general meeting of shareholders held in Ha Noi on Saturday. “The capital raising requirement of VietinBank is extremely urgent. Unlike other commercial banks, VietinBank could not raise capital through additional issuance solutions to investors due to its limitations: State ownership in joint stock commercial banks having State capital must not be less than 65 per cent while the foreign investors' ownership percentage is a maximum of 30 per cent," he said. This year, the bank was assigned a credit growth limit of 8.5 per cent by the State Bank of Viet Nam (SBV). However, if the economy sees a good recovery, Vietinbank would submit to increase the limit. VietinBank expected outstanding loans to grow by 4 to 8.5 per cent in 2020. The mobilised capital would grow in line with the use of capital, balanced with the growth rate of outstanding loans, expected at 5 to 10 per cent. Meanwhile, the non-performing loans (NPL) ratio would be controlled at less than 2 per cent. The bank has not set a specific profit target this year, but affirmed to ensure business effectiveness and improve its operation. It will closely follow changes and impacts of COVID-19 to update its profit plan based on the approval of authorities. VietinBank clarified tasks in the restructure plan and resolving bad debts in the 2016-20 period, improving profitability and renewing business structure, customers and managing growth quality. VietinBank would meet requirements of Basel II as soon as it completes the equity capital increase. Especially, it would complete the development strategy in 2021-30 and middle-term business plan in 2021-23 . It would continue to restructure credit categories, increasing the portion of small-and-medium sized enterprises and retail segments while diversifying revenue structure. “As the global and domestic economy faces many challenges, the whole system of VietinBank will implement practical and effective solutions to support businesses and people to overcome difficulties, having breakthrough developments after the COVID-19 pandemic,” the chairman said. Responding to shareholders’ questions about bad debt, he said that it was difficult to predict the impact of COVID-19 because the pandemic had not been controlled. Influence from other countries would greatly affect an open economy like Viet Nam. The bank has implemented necessary support measures to accompany customers to stabilise production and business activities, offering many support programmes. However, many customers of VietinBank are affected by decreasing incomes, affecting consumer loans, business and production. VietinBank’s capital adequacy ratio (CAR) has been at 10 per cent according to Basel I and 8.6 per cent according to Basel II which is under SBV’s stipulated level. The bank estimated that its profit would reach VND6 trillion by the end of the second quarter of the year. The bad debt rate would be controlled at 1.5 per cent. VietinBank bought VND3.1 trillion from Viet Nam Asset Management Company (VAMC) while the company still owned over VND9 trillion, of which over 50 per cent has been set aside. The meeting dismissed the position of members of VietinBank Board of Directors for Hiroshi Yamaguchi and Hideaki Takase at the proposal of Tokyo-Mitsubishi UFJ Bank (MUFG Bank). It voted three members into the board in 2019-24 period including Masahiko Oki, Deputy Head of Planning Department at MUFG and deputy general director of Vietinbank, Shiro Honjo, MUFG's executive staff, head of global commercial banking planning and Nguyen Thi Bac, Head of Risk Management Division at Indovina Bank. 2020 consumption stimulus event to kick off in July The HCM City Department of Industry and Trade announced that it would hold the 2020 consumption stimulus event from July 2-5 this year as a measure to support local producers amid the COVID-19 pandemic. According to the department, the event is expected to boost economic recovery and normalise commercial activities in the city that have been affected by the COVID-19 pandemic At the event, about 500 booths will showcase specialties of HCM City and other localities, industrial consumer products, agricultural goods, foods and export products. The event, which will be financed by firms and the Government’s trade promotion funds, will also include promotion and discount programmes to stimulate consumption and help local firms remove their stockpile. FPT a match made in heaven for AI centre Vietnam’s ICT-related services group FPT Corporation is looking like the clear favourite to develop the central province of Binh Dinh’s ambitious AI hub, which is planned to turn it into a regional and global powerhouse in AI development. The corporation is reportedly working with the central province to join its project on building its hallmark AI Centre and adjacent supporting urban area. Binh Dinh Department of Planning and Investment early this year announced details of the project, whose investment capital is estimated to be VND4.36 trillion ($189.6 million) and which is aimed to be developed into one of the world’s largest AI centres. The total investment will include VND3.9 trillion ($169.5 million) for construction, with the remaining capital going to site clearance. FPT is operating a number of projects on AI and high-tech education in the province. These initiatives are said to position the group favourably to be selected as the developer of this particular centre, which is planned to be built on a large golden location at the centre of Quy Nhon city. The 94-hectare project in Tran Quang Dieu and Bui Thi Xuan wards will include an AI research and development (R&D) centre, a software development facility, smart buildings housing 2,100 apartments, and public infrastructure as well. When picking the developer, Binh Dinh Department of Planning and Investment will look at applicants’ financial capacity first, then ascertain whether investors’ equity is VND655 billion ($28.5 million) at least. Subsequently, it will look into the applicants’ ability to arrange the necessary finances for the project. “The investors have to have experience in similar projects, including developing buildings, urban areas, commercial housing, multi-purpose complexes consisting of R&D, AI, and software development components, which they have done by themselves or contributed at least 50 per cent of the total capital,” the document of Binh Dinh Department of Planning and Investment highlighted. Investors can lodge the bidding registration documents before May 28. FPT appears as a clear front-runner of the bidding. Last December the corporation broke ground on its FPT University campus specialising in R&D and technology. This 5.7ha campus in An Phu Thinh urban area is expected to supply high-quality human resources especially in AI, a core technology of Industry 4.0, for Binh Dinh and the country and enabling the province to become a global AI centre. Previously, FPT established FPT Software Quy Nhon in 2018, also specialising in AI, with the target of employing a workforce of 500 within two years. However, tech experts question the capacity of FPT in this sector. “The 500 employees of FPT mainly do outsourcing work for data labelling, which is the bottom rung of AI research,” said one expert. However, the FPT University campus and the FPT Software Quy Nhon speak strongly in favour of the corporation’s bid to develop Binh Dinh’s largest technology centre that encompasses the province’s strategic national and regional ambitions. The corporation has been steadily building up their presence in the province and the city, setting itself up to bag this project. “The project was practically made for FPT, and will most likely go to them,” said the expert./. Overseas investors ramp up preparations for post-pandemic operations Foreign investors could angle to add even more capital to their current projects in Vietnam as a result of superb COVID-19 prevention in the country. The impact of the coronavirus pandemic on foreign investment inflows in Vietnam has been noticeable. However, a rise in additional investment in existing projects in the first four months of the year has been a highlight in a bleak foreign investment picture, showing unbroken trust in the investment environment and their long-term commitment to Vietnam. The latest report from the Foreign Investment Agency under the Ministry of Planning and Investment showed that in the first four months of 2020, about 335 capital-adjusted projects recorded an added investment of more than $3.07 billion, up 45.6 per cent on-year. However, total newly- registered capital hit $6.8 billion, down 9.1 per cent on-year. Several notable moves were made just before the globe was affected by coronavirus, with many groups looking to get back on track as soon as possible. Recently, Thailand-based SCG gained approval to pump an additional $1.39 billion into Long Son Petrochemical Complex located in the southern province of Ba Ria-Vung Tau, increasing the total investment capital to $5.1 billion. The new investment in the Long Son complex is expected to breathe new life into the venture which is running significantly behind schedule. The project’s construction began in early 2018. Last year, SCG vowed to put the project into operation in late 2022. The integrated complex will have a total olefin production capacity of 1.6 million tonnes a year and will create more than 20,000 jobs during construction, including more than 1,000 skilled positions. It is expected to contribute around $60 million to the annual state budget. In February, German bearing and industrial equipment manufacturer Schaeffler Vietnam inaugurated its $50 million new plant at Amata Industrial Park in the southern province of Dong Nai, setting a solid foothold in Vietnam with the total registered investment capital of $160 million. Helmut Bode, general director of Schaeffler Group in the Asia-Pacific, said the facility will produce robotic components to orders by businesses from across the world. Georg F. W. Schaeffler, chairman of the group, added that Vietnam has a strategic location in Asia and a diversified, stable, and fast-growing economy with a talented and well-educated workforce, which was why the company chose the country to build its first manufacturing plant in Southeast Asia. Meanwhile, Bosch Vietnam has expanded investment in its existing manufacturing facility in Dong Nai, increasing the company’s total registered capital in Vietnam to $530 million. As of now, the group has disbursed $195 million of this, from the initial $54 million figure. The production capacity of the factory has also been continuously extended, with the annual initial capacity rising from 1.6 million to 26 million transmission belts, satisfying Bosch’s global manufacturing and quality standards. The investment and the company’s continuous growth in the past 10 years has shown Bosch’s long-term commitment to further strengthening its presence in Vietnam. “The group will pour an additional $100 million in the manufacturing facility in Dong Nai in the next five years to expand the operation of the transmission belt as well as modernise manufacturing lines,” said Mallikarjuna Guru, general director of Bosch Vietnam. Banks skeptical of BOT transport project relief Despite the Ministry of Transport’s proposal to increase the debt repayment period and cut lending rates for build-operate-transfer transport project operators, lenders remain concerned. On May 8, the ministry (MoT) sent Document No.4416/BGTVT-DTCT to the prime minister seeking for financial supporting policies for build-operate-transfer (BOT) transport projects, including restructuring the debt repayment period, cutting lending rate by 2-3 per cent, and stopping banks from changing them into bad debts. The proposal, however, may be a tough task because banks have remained silent on the matter. “It is difficult to restructure the debt repayment period as banks are not ready and are concerned about risks. BOT transport is not a priority for them,” Le Duc Khanh, director of the market strategy department at PetroVietnam Securities, told VIR. “However, powerful state-run banks would have to follow a government order.” Phan Dung Khanh, investment advisory director for Maybank Kim Eng Securities, said that along with transport, businesses in other sectors also have difficult access to bank loans. “Banks are in a dilemma. Vietnam’s bad debts are forecast to increase in the coming time and so banks are tightening control,” Khanh noted. The MoT, which is managing 61 BOT projects, also proposed reducing tax and allocating VND5.08 trillion ($220.87 million) to support BOT projects that are suffering partly because they have not received permission to increase tolls. The ministry even proposed to buy related projects with funding from the 2021-2025 public investment pot. The proposal comes as BOT operators are facing huge losses due to a fall in traffic during COVID-19. At the end of 2019, 45 BOT projects reported lower revenues than forecast in their contract signed with the state, with Thai Nguyen-Bac Kan and Thai Ha Bridge reaching only 13-15 per cent of initial plan. While the Ministry of Finance’s Circular No.159/2013/TT-BTC dated November 15, 2013 on adjusting road toll by roadmap stipulates BOT transport operators can increase tolls every three years at the rate of 12-18 per cent, the government’s Resolution No.35/NQ-CP released in 2016 on supporting enterprises until 2020 stopped them from executing this right. Pham Quang Dung, chairman of Tasco JSC, already constructing many BOT projects nationwide, said, “If we get permission to increase tolls now, BOT developers would not need to restructure bank debts. Companies cannot wait until 2022 for permission.” Nguyen Tuan Huynh, general director of Cienco 4, the investor of the Thai Nguyen-Cho Moi BOT project, said that many ventures will go bankrupt by the 2022 deadline, and banks will see more bad debts. Shrinking revenue at BOT projects has been a hot issue for years because of the high initial construction costs, long duration of recovery (20-30 years), and a lack of a risk-share mechanism, which makes it difficult for the transport sector to attract international ventures despite strong interest. Recently, the eight public-private partnership sections of the eastern cluster of the North-South Expressway had to cancel international bidding partly because of these reasons. Thus far, any BOT transport schemes are bogged down in difficulties, with many halting construction for years even, due to difficult loan access. Thailand’s exports up 2.1 percent in April thanks to agricultural, gold shipments Thailand’s customs-based exports recorded an annual growth of 2.12 percent in April as a result of higher shipments of agricultural products, food and gold, according to the country’s Commerce Ministry. Exports of agricultural and agro-industrial products went up 4.03 percent, corresponding to rising global food demand during lockdowns to curb the spread of the coronavirus disease. Rice exports bounced back to increase 23.1 percent, while the shipment of industrial products overseas grew 4.05 percent, led by gold, aircraft, electric circuits, and medical supplies. Exports to Thailand’s major markets – the US and Japan – continued to grow significantly. However, the severe spread of the virus in Europe suppressed its exports to 15 EU countries last month. Local media said the spike in gold exports showed the risk aversion effects arising from the COVID-19 pandemic and global economic slowdown, resulting in rising gold prices and large exports to Switzerland, Singapore, and China’s Hong Kong. In addition, global oil prices have suppressed exports of oil-related products to the ASEAN and CLMV (Cambodia-Laos-Myanmar-Vietnam) markets. Excluding gold, oil, and weaponry, Thai exports decreased 7.53 percent in April, the ministry said. For the first four months of this year, exports increased 1.19 percent, however, it contracted 0.96 percent excluding gold, oil, and weaponry./. Ha Nam becomes attractive destinations for investors The northern province of Ha Nam has become an attractive destination for domestic and foreign investors thanks to the locality’s transparent investment policies and mechanisms. In recent years, Ha Nam has focused on selecting investors with sound financial capacity that use advanced production technologies. To fully tap its potential, the locality is focusing on upgrading and developing modern transport infrastructure systems connected to neighbouring localities to form a synchronous network, serving the locality’s socio-economic development roadmap. It has paid heed to improving the quality of services in industrial parks (IPs) and vocational training, thus facilitating production and business activities while meeting the demand for skilled human resources. Attention has also been paid to accelerating administration reforms, and taking measures and incentives to support businesses. The IPs in Ha Nam with a high occupancy rate are Dong Van IPs I, II, and III. By the end of the first quarter, Ha Nam was home to 956 valid investment projects worth over 5.36 billion USD, including 302 foreign-invested projects. In 2019, enterprises operating in the locality contributed nearly 6 trillion VND (over 257.6 million USD) to the State budget, accounting for 66.67 percent of the province’s total budget revenue. They created jobs for nearly 144,000 labourers./. Wood exports grow thanks to businesses’ activeness Despite the COVID-19 pandemic’s impact, the wood industry still enjoyed 3.2 billion USD in exports in the first four months of 2019, up 6 percent year on year, thanks to businesses’ efforts to switch to online trading and find new markets. During the period, about 7 percent of members of the Handicraft and Wood Industry Association of Ho Chi Minh City (HAWA) had to halt operation while 51 percent cut output. About 45 percent of their employees were also laid off temporarily. However, HAWA members still earned more than 1 billion USD from timber and forestry product exports, rising by over 10 percent year on year. Of the value, over 698,000 USD was from wood product shipments, up 5.8 percent from a year earlier. Data from the Binh Dinh Department of Industry and Trade also shows that wood firms in the province also recorded a year-on-year increase of 13 percent in exports to about 188 million USD in the four months. Chairman of the Binh Dinh Forest Products Association Le Minh Thien attributed the growth to a sudden surge in the sales of wood chips to China. Meanwhile, the export value of wooden furniture was maintained as businesses had already manufactured products in 2019 and focused on exports right after the Lunar New Year holiday in late January. Vietnam’s effective control of the COVID-19 outbreak amid production suspension by rivals in other ASEAN countries, the EU and the US has also helped local firms receive more orders. Besides, Thien noted, businesses have also proactively sought new orders from the Australian, EU and US markets while importers and exporters, along with producers and distributors, have discussed mutual support measures with one another. President of the Vietnam Timber and Forest Product Association (VIFOREST) Do Xuan Lap said he believes that the wood industry can still record nearly-double-digit growth in 2020, adding that controlling the pandemic will help turn the country into a magnet for global wood processors. Many Vietnamese enterprises are also actively restructuring their products to adapt to changes in the market. The output may decline in the second quarter, but it’s normal since orders usually drop by 30 percent during summer, he said. According to Thien, the wood industry still needs to improve the quality of seedlings, expand the certified forests that are specialised in timber production, and ensure legal supplies of input materials. It is also necessary to promote wood processing, connect manufacturers with firms in the support sector, develop production chains, help companies improve their competitiveness and raise market shares in key export destinations, and diversify products. VIFOREST recently coordinated with associations, producers and processors in the industry to devise solutions to sustain production activities, including advertising and selling products on the internet and providing training in sales skills on big e-commerce platforms like Amazon and Alibaba./. S&P maintains stable outlook for Việt Nam’s sovereign credit rating S&P Global Ratings has announced it has maintained Việt Nam’s sovereign credit rating at BB, with a stable outlook, in its latest report released late last week, according to the Ministry of Finance. The move is a reflection of the strong potential for recovery in Việt Nam’s economy following a period of deceleration due to the COVID-19 pandemic. S&P evaluated that Việt Nam’s solid growth achievements over past years will continue to support the maintenance of the country’s sovereign credit rating. In the scenario where the global pandemic is basically controlled by the end of 2020 or early 2021, S&P forecasts that Việt Nam’s real GDP growth will recover in 2021 and from 2022 onward will approach the development speed the country set in the long term, of 6 to 7 per cent. Globally, since the beginning of April, S&P has adjusted the negative credit rating of 32 countries. While working with S&P to evaluate the sovereign credit rating in late April, the Ministry of Finance and relevant agencies presented convincing evidence about the adaptive capacity of Việt Nam’s economy, which has been clearly illustrated in the challenging global context. Apart from successfully curbing the COVID-19 pandemic, Việt Nam has supported, cooperated, and shared experience in fighting the disease with other countries and international organisations, which has been greatly appreciated by the international community, the ministry said. This outcome demonstrates the deep connection between the Vietnamese Government and people, which facilitated the strong recovery of the economy after COVID-19, it added. HCMC to build one more industrial zone HCM City Department of Planning and Architecture is planning to build a new hi-tech industrial park that covers 380ha in Binh Chanh District. HCM City People's Committee asked the department to review the current industrial and processing zones and find suitable lands to attract investments to the city and build the new hi-tech industrial park. The new park will be a new gathering place for hi-tech firms and support start-up companies. HCM City Export Processing Zone and Industrial Park Authority (Hepza) will work with the department on how to deal with violations such as firms that operate not in accordance to their registered businesses. Hepza must also report about suitable land that can attract immediate investment or for business expansion. They must propose solutions to violations and difficulties that firms may face. HCM City has three processing zones and 16 industrial zones that cover a total 4,532ha. 17 of them have gone into operation in the past years. 1,716ha have been rented out. According to the plan, HCM City will have 23 processing and industrial zones that cover 5,822ha by the end of 2020./. Lengthy break-even period discourages investment in underground parking lots Authorities in HCMC are finding it hard to attract investors in underground parking lot projects, largely due to the lengthy period of capital recovery. The municipal government has planned for the construction of several underground parking lots within the city center, but these projects have yet to get off the ground. One project, which aims to develop the basement of the Le Van Tam Park into a parking lot and public service complex, is awaiting the appraisal of its technical designs. The investor in an underground parking lot at the Trong Dong (Bronze Drum) Music Stage Theater in District 1 is making adjustments to its basic designs. Meanwhile, other investors are starting to work on similar projects at Hoa Lu Stadium, Tao Dan Cultural Park and September 23rd Park, all in District 1. The HCMC Traffic Department noted that underground parking lot projects require large sums from investors. However, the main stream of revenue is parking fees. Part of the parking lots are zoned for business, service and commercial activities, but their overall profit rates may be low and it may take a long time to break even, according to authorities. Data revealed that underground parking lots at Le Van Tam Park and Tao Dan Cultural Park are expected to take 31 and 46 years, respectively, to recover their investment costs. Also, office leasing services in downtown HCMC are subdued, which will have a major impact on the projects’ capital recovery and financial plans./. Danang needs US$13 billion for city development The People’s Council of Danang City approved the master zoning plan for the coastal city on May 22, saying that the city will seek VND300 trillion (about US$13 billion) to carry out the plan. The master plan will then be sent to the Ministry of Construction for its evaluation, before being submitted to the Prime Minister for approval. The first phase, in 2020-2025, needs more than VND232 trillion, while the remainder is for the second phase, planned for 2025 to 2030. “This investment capital is combined from many sources [State and local budgets, loans and private investment], including those for projects carried out from 2021 to 2030,” Tran Chi Cuong, head of the Economics and Budget Committee of the municipal People’s Council told the Saigon Times. Some key projects in the first phase are developing the Lien Chieu seaport into an international seaport, and Tho Quang wharf. Meanwhile, the second phase will see the relocation of the railway station and Han River crossing tunnel, apart from other urban development projects. At the meeting, some members said the total investment capital is too large, especially in the 2020-2025 period. Therefore, it is essential to have a priority roadmap for key projects to avoid a lack of capital during the investment process. At the same time, the city should carry out investment procedures quickly so that private investors can participate in some projects. Speaking at the meeting, Ho Ky Minh, Vice Chairman of the municipal People’s Committee, said the city would have to call for investment capital from the business community, both local and foreign. Earlier, the city government announced that it was developing a master plan in a bid to receive input from other concerned parties. Consultants for the master plan include the joint venture of Sakae Corporate (Japan) and Surbana Jurong (Singapore). VNN |
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EVFTA to fan flames of European investor interest02:45 European investors are expected to stir mergers and acquisitions activities in the coming time as the landmark free trade agreement between the European Union and Vietnam nears ratification.
Chau Huy Quang, managing partner of Rajah & Tann LCT Lawyers, told VIR that there has recently been a drastic wave of European investor interest in various industries including manufacturing, consumer goods, renewable energy, and technology. With ongoing developments, especially the recent ratification of the EU-Vietnam Free Trade Agreement (EVFTA), it is expected that the investment and mergers and acquisitions (M&A) from European investors shall be significantly expanded. This trend reflects that European investors are on the lookout for M&A deals to scale up presence in Vietnam ahead of the historic deal moving into effect. Poland’s pharmaceutical maker Adamed Group has acquired the controlling portion of shares in Dat Vi Phu Pharmaceutical, Vietnam’s fastest-growing pharma-maker, marking it the largest direct Polish investment in Vietnam to date. Similarly, Norwegian telecommunications company Telenor Group acquired the Cho Tot platform to tap into the growth potential of Vietnam’s digital services as mobile data coverage and affordable data connectivity spreads quickly through the country. Stefano Pellegrino, board member of EuroCham’s Legal Sector Committee, said European investors are traditionally considered financially capable, socially and environmentally responsible, and with deep technological know-how. These are their strengths in the Vietnamese M&A market. “Notable sectors of interest range wide, from renewable energy, pharma, and logistics to oil and gas, food and beverage, and consumer goods, most of which will be positively affected by the EVFTA,” he added. Data by the Foreign Investment Agency under the Ministry of Planning and Investment indicated a growing number of capital contribution and share purchases by European backers in the first four months of 2020. Specifically, investors from France have implemented 78 transactions worth $27 million, up 37 deals against last year. Meanwhile, financiers from the United Kingdom, the Netherlands, and Germany conducted 32, 15, and 27 transactions, worth some $38.5 million, $46 million, and $4.7 million, respectively. According to Linda Liu, economist at Maybank Kim Eng, the EVFTA will open up opportunities for Vietnam to become a trading gateway for European businesses in the ASEAN. It will also help diversify Vietnam’s trade partners and bring in greater foreign investments for Vietnam. To date, Vietnam and Singapore are the only two ASEAN countries to have FTAs with their two major trading partners outside the region – the EU and China – thereby securing preferential market access to three main export markets of the EU, China, and the ASEAN. This puts Vietnam in a favourable position in attracting foreign investment compared to regional peers. The EVFTA will also support the liberalisation of the Vietnamese market through greater market access in the services sector, easing investment restrictions, and increased investment and intellectual property protection for European companies. “This market access and loosening of investment restrictions are a catalyst for M&A interest in Vietnam by European investors,” Liu stressed. Quang of Rajah & Tann LCT Lawyers pointed out that the EVFTA is a significant milestone for promoting and protecting European investments in Vietnam. While Vietnam’s commitments under the World Trade Organization remain the primary framework governing the market opening for foreign investment in the service sector, the EVFTA will focus on providing even broader and deeper commitment. For instance, interest will grow with the gradual abolishment of economic needs tests for retail services. Moreover, raising the foreign ownership cap to 70 per cent in shipping transport services would attract new European logistics service providers while existing players may look to further explore investment opportunities. According to Quang, there are also express provisions for the clean energy field which would generate greater interest from investors. Furthermore, the EVFTA would not only benefit European investors with business interests in Vietnam, but also have a positive effect on policymaking, benefiting all in the long run. VIR VNN/Thanh Van |
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BUSINESS NEWS HEADLINES MAY 2901:53Local coffee prices skyrocket on limited supply Coffee prices have kept rising since the beginning of May as the product is in short supply in the domestic market, according to the Import-Export Department under the Ministry of Industry and Trade. Moreover, a recent severe water shortage has also greatly affected the coffee output of the Central Highlands region which has the largest coffee growing acreage in the country. The General Department of Customs reported that Vietnam exported 165,800 tonnes of coffee at a value of US$279.83 million during April, a fall of 2.5% in volume and a drop of 5.1% in value. Indeed, the opening four months of the year saw the nation ship 682,800 tonnes of coffee abroad with a total value of US$1.15 billion, an increase of 8.1% in volume and up 5.3% in value in comparison to the same period from last year. Moreover, April saw the average export price of coffee drop by 2.7% to US$1,688 per tonne, causing the average export price over the course of the four-month period to suffer an annual decline of 2.6% to US$1,682 per tonne. Throughout the four-month period, the average export price of coffee to several foreign markets, including Myanmar, Chile, China, South Africa, and New Zealand enjoyed an upward trend. In contrast, the average export price of coffee to other markets such as Singapore, Cambodia, Israel, and the Philippines suffered declines. Coffee exports during April to several major markets such as Germany, the United States, Spain, Belgium, Russia, Japan, and the Republic of Korea increased from the figures seen during April last year, while exports to Italy, the Philippines, and Algeria all declined. Most notably, coffee exports to the German market during the four-month period enjoyed a vast increase of 35.4% to US$176 million, while coffee exports to the US market fell by 14.4% to US$102 million. Vietnamese businesses strive to overcome barriers upon joining EVFTA The EU-Vietnam Free Trade Agreement (EVFTA) will require Vietnamese businesses to overcome their own barriers in order to fully participate in the trade deal and enjoy its benefits, Nguyen Dinh Cung, former Director of the Central Institute for Economic Management (CIEM), has stated. Having recently been submitted to the National Assembly for approval, the EVFTA is widely expected to provide fresh impetus for the nation’s economic recovery after being hit by the impact of the novel coronavirus (COVID-19), in addition to speeding up various reforms. According to a Government report, two-way trade and investment between the EU and the country following the trade deal’s implementation is expected to grow at a fairly strong level, positively contributing to the nation’s economic growth and creating jobs for local workers. Most notably, the state budget revenue may also be improved and may enjoy a boost over the medium to long term. In addition to an impact on the economy, the agreement will have various different implications on sectors relating to the level of openness, competitive advantage, and capacity of each industry. Moreover, the indirect effect of the EVFTA through the pressure of institutional reform will also bring about positive effects for the national economy. With regard to the EU's commitment to Vietnamese exports once the trade deal becomes effective, the EU has pledged to abolish import duties on approximately 85.6% of tariff lines, equivalent to 70.3% of the country's overall export turnover to the bloc. Furthermore, seven years after implementation, the EU will then move to eliminate import duties on 99.2% of tariff lines, equivalent to 99.7% of Vietnamese exports. With regard to the remaining 0.3% of exports, the EU has committed to offering Vietnamese import’s duties of 0% within a certain quota. Tariffs placed on the nation’s key exports will be eliminated by the EU once the Agreement comes into effect or there has been a roadmap agreed of no more than seven years. Simultaneously, the country will move to eliminate customs duties relating to 48.5% of tariff lines, equivalent to 64.5% of imports from the EU, once the Agreement comes into effect, followed by roughly 99% of tariff lines, equivalent to 99.8% of imports from the EU, after 10 years. According to Minister of Industry and Trade Tran Tuan Anh, the COVID-19 has had a profound impact on the Vietnamese economy and that of other countries globally, this therefore represents the time to activate production and restart the economy whilst boosting market diversification without relying too much on certain markets. Vu Tien Loc President of Vietnam Chamber of Commerce and Industry (VCCI) described the EVFTA as a "highway" which can link the nation to a GDP market of US$15,000 billion, whilst also offering the country the chance to enjoy breakthroughs during its economic recovery period following the COVID-19 epidemic. Despite this, the VCCI Chairman also noted that participation in this "highway" is not free. "We have to pay fees by investing and upgrading the infrastructure and economic institutions and quality of human resources. Enterprises must invest, upgrade their management, and business strategies to take full advantage of the opportunities from this agreement. The ratification of the agreement in the context that we have contained the pandemic and are in the period of redevelopment will be considered an important driving force for the Vietnamese economy,” said Loc. Former CIEM Director Dr. Cung stated that the EVFTA will help boost the market and open up new demands for production, export, and investment through the reduction of tax lines, import, and export procedures that will make investment and business activities more open and transparent./. Stock trading inconsistencies spotted at Camimex Group The Ho Chi Minh City Stock Exchange has highlighted several inconsistencies in stock transactions related to Camimex Group, with four individual shareholders under suspicion of dishonest trading while the group itself is showing a grievous lack of transparency in the staging of its IPO. The recent transactions involving Camimex Group, a large local shrimp exporter and producer, raised the red flag over a painful lack of transparency during the process of calling for capital. Notably, the Ho Chi Minh City Stock Exchange (HSX) issued the information that Nguyen Trong Ha, chief accountant of Camimex Group, registered selling 3.05 million shares. The transaction is implemented under the put through method, which is expected to occur from May 18 to June 16, 2020. Ha is currently the largest shareholder of the company, but after the sale, her interest in the company would be zero. Previously, on May 13, Dang Ngoc Son, a member of the board of directors cum deputy general director of Camimex registered to sell nearly 3 million shares (equalling 11.29 per cent) under the put through method to decrease his holding in the company to 0 per cent. The transaction is expected to occur from May 19 to June 18. At the same time, Vu Thi Bich Ngoc, the wife of chairman Bui Si Tuan of the Board of Directors, registered to buy 2.99 million Camimex shares, equalling 11.29 per cent stake. The purchase is expected to be completed between May 12 and June 12, 2020. Without context, these moves would be normal. However, in light of the extraordinary activities in previous months, they become suspect. Notably, in late January 2020, Camimex published the business results for 2019. Accordingly, full-year profit increased by 74 per cent on-year. Besides, its share value increased by 60 per cent on-year. After that, in early February, Camimex sold 114 million shares to existing shareholders (equaling 100 per cent of its charter capital). At the time, 134 domestic shareholders bought 9.4 million shares (71.2 per cent of the offered shares), five foreign shareholders bought 799 shares, and four private investors bought 3.81 million shares. Notably, chief accountant Nguyen Trong Ha and Dang Ngoc Son – a member of the Board of Directors cum deputy general director – bought 11.54 and 11.29 per cent of the charter capital. In addition, Ha Van Bang, an investor who previously did not own any Camimex shares, also bought 1.6 million shares to become a large shareholder with the ownership ratio of 6 per cent. After this sale, in late March 2020, the company published the audited financial statement for 2019, which showed that its after-tax profit decreased by 70.7 per cent against the unaudited figure, while the profit for the whole year declined by 49.1 per cent. As a result, its shares plunged to VND10,800 (46.96 US cents) on April 22. However, since late April, its shares have risen to VND18,000 (78.26 US cents). Especially, at transaction sessions when its shares hit the ceiling rate, large volumes of shares were matched. An issue noted by the HSX was that Son and Ha increased their shareholding in the firm from nothing to more than 11 per cent each in only two months and then want to divest their entire holdings via put through deals. On May 11 and 13, Ha Van Bang also transferred his entire holding in the company. In light of the above information, investors expressed concerns that these shareholders, who are in fact related to the company, only bought share that would have been left unsold otherwise to make the sale seem more successful than it actually was and then wait for the shares to rise and sell. In addition, in the audited financial statement for 2018, there was a qualified opinion from the State Audit Office of Vietnam relating to the unsold shares, however, the State Securities Commission of Vietnam still authorised the company to implement its initial public offering (IPO) in 2019. Furthermore, on March 28, 2020, on the day the company published information about the sale, the Board of Directors of the company issued the decision to adjust the purpose of using the mobilised capital. Accordingly, instead of using part of the capital to invest in machinery and equipment and another part to supplement the working capital, the company will pour the entire proceeds into the working capital. Some investors expressed concerns over the sudden change as well as the steps to reach shareholders' approval for the change. VIR contacted the investors with these concerns and is waiting for their reply./. Vietnamese iron and steel exports to Germany surge sharply A number of Vietnam’s export commodities to Germany, such as iron and steel, machinery, and sports equipment, increased sharply during the opening four months of the year, despite the negative impact of the novel coronavirus (COVID-19) epidemic globally, according to the General Department of Vietnam Customs. Most notably, the country’s iron and steel exports to the European nation experienced a 27-fold annual increase during the four-month period, grossing a total of US$2 million. In spite of enjoying rapid growth, this product accounts for a very small proportion of turnover to the German market, therefore it does not make a huge difference to the overall export figure. In addition, plenty of export commodities to the market have seen an increase in business during the four-month period, despite the complicated nature of developments caused by the COVID-19 pandemic worldwide. Indeed, the export of machinery, equipment, tools, and spare parts increased by 50%, reaching approximately US$199 million. Coffee exports also soared by 26.5% to US$176 million throughout the reviewed period. Elsewhere, toys and sports equipment enjoyed robust growth of over 187%, reaching a total of US$46.5 million./. Mobile World reports 45 per cent plunge in after-tax profit The closing of hundreds of Mobile World stores across the country during COVID-19 has made the electronics retailer's after-tax profit drop by 45 per cent in April. Accordingly, net revenue was about VND7.834 trillion ($340.6 million) while after-tax profit was VND209 billion ($9.1 million), down 14 and 45 per cent on-year, respectively. Accumulated figures during the year’s first four months showed net earnings of VND37.178 trillion ($1.6 billion) and after-tax profit of VND1.341 trillion ($58.3 million). Of this, the total turnover of thegioididong and Dien May Xanhstores plunged by nearly 30 per cent due to halting the operations of more than 600 establishments in the first half of April, with the month being a traditional peak season for the chains. While the firm tried to optimise operation costs, the nationwide social distancing left an unmistakable mark on its net profit. Meanwhile, its online business recorded a growth of about 20 per cent and occupied about 16 per cent of its total turnover for the month. The Bach Hoa Xanhstores specialised in food and grocery, thanks to the high demand for necessities, reported record revenue of VND1.8-1.9 trillion ($78.26-82.6 million) and has maintained a daily revenue of VND1.4 billion ($60,870)./. VPBank to drop foreign ownership limit from 23 to 15 per cent At its recent annual shareholders' meeting, the Board of Directors of VPBank signalled that it would reduce its foreign ownership limit in the coming time. Accordingly, the Board of Directors of VPBank would request approval from its shareholders to lower the foreign ownership limit (FOL) to 15 per cent from the current 23 per cent. The bank will also launch a treasury buyback for 5 per cent of the shares to realign the ownership structure. The bank reported upbeat performance in 2019, with earnings reaching VND8.260 trillion ($359.13 million). However, it would not issue any cash dividends and instead reinvest these profits into its operations to sustain growth. The Board of Directors also submitted a plan to issue 17 million shares (0.672 per cent of the total outstanding shares) for the Employee Stock Ownership Plan (ESOP) at VND10,000 (43.48 US cents) per share. The bank plans to use the existing treasury shares and the lock up will allow recipients to sell 30 per cent of holdings after the first year, another 35 per cent after the second year, and another 35 per cent after the third. Last year, the bank has issued $300 million of bonds with a three-year term under the Euro Medium Term Note (EMTN) programme, with a face value of $200,000 per bond and maturity date of July 17, 2022. The bonds are issued under the book building method and based on the consultation and arrangement of Standard Chartered Bank, BNP Paribas, and J.P. Morgan. The bonds are issued on the international market, that is, investors outside of US territory in line with Regulation S of the US Securities Act of 1993 (amended) and listed at the Stock Exchange of Singapore./. Hanoimilk to be delisted from HNX in June Once-iconic local milk producer Hanoimilk (HNX: HNM) will be delisted from the Hanoi Stock Exchange in June due to prolonged weak performance. The Hanoi Stock Exchange has just announced plans to delist 20 million HNM stocks on June 12 with the reason that it has delayed submitting the audited financial reports for the past three years (2017-2019). Previously, the company was suspended from transactions since last October for violating the disclosure requirements of the stock exchange. Indeed, Hanoimilk has been ailing for more than 10 years. In 2008, the firm reported losses of VND40 billion ($1.74 million) although its revenue rose to VND350 billion ($15.2 million). Since then, it has been falling deeper in the doldrums. In the latest three years, Hanoimilk reported about VND160-190 billion ($6.96-8.26 million) in net revenue. In 2017, it saw a deficit of VND19 billion ($826,090). In 2018-2019, the company earned tiny profit of less than VND1 billion ($43,480) while local milk giant Vinamilk made a daily profit of nearly VND30 billion ($1.3 million). As of the end of 2019, Hanoimilk's after-tax profit was minus VND23 billion ($1 million). Shareholders' equity in Hanoimilk is about VND200 billion ($8.7 million), equaling 1.1 per cent of Vinamilk’s charter capital. At last year's shareholders' meeting, Hanoimilk’s leaders said that the firm has yet to agree on operating fees, leaving it unable to submit its audited financial reports for three years. “We will try to resolve the problem as soon as possible,” the leaders said. In the first quarter of 2020, Hanoimilk continued to post weak business results with VND38 billion ($1.65 million) in net revenue and VND4 billion ($173,910) in net losses. Founded in 2001 and officially coming into operation in 2003, Hanoimilk JSC used to be one of Vietnam’s leading dairy enterprises with branded dairy products IZZI, Yotuti, and Hanoimilk 100 per cent fresh milk./. 21 Vietnamese enterprises seek opportunities to export farm produce to China The Ministry of Industry and Trade and the Ministry of Agriculture and Rural Development said that Vietnam is entering the harvest season of many types of fruits, agricultural products, and foods so several large events to promote trade will be organized shortly to boost exports to the Chinese market as the demand in this country is on the increase after the Covid-19 pandemic. On May 24, the office of the MoIT informed that the Trade Promotion Agency and the branch of the Vietnam Trade Office in Kunming will collaborate with the China Council for the Promotion of International Trade – Yunnan Branch to organize an online trade conference on agricultural and food products between Vietnam and China on May 26 and 27. At this conference, 21 Vietnamese enterprises trading agricultural, aquatic, and processed products will introduce and offer their products to importers in Yunnan Province, China. According to Mr. Do Quoc Huong, Head of the branch of the Vietnam Trade Office in Kunming, in Yunnan Province, currently, all production and trade activities have basically returned to normalcy but agricultural production still faces difficulties. The forecast by the Department of Commerce of Yunnan Province shows that from now to the end of June this year, the province needs around 25-35 percent of essential agricultural products, including vegetables, fruits, food, and foodstuffs. The branch of the Vietnam Trade Office in Kunming forecasts that the demand for food and foodstuffs in Kunming in particular, and Yunnan Province, in general, will highly increase soon. Therefore, Vietnamese enterprises need to promote trade to grasp this opportunity. Ms. Nguyen Thi Thu Thuy, Deputy Director of the Export Promotion Center under the Trade Promotion Agency, said that as for the Chinese market, the agency has made plans to hold around 8 to 10 events to connect trade, using the method of “cloud-based exhibition” and “no direct contact” this year. The online trade conference on agricultural and food products between Vietnam and China (Yunnan) 2020 is the third event of its kind held by the agency in association with relevant departments in the past two months with the Chinese market. Right after the event with Yunnan Province, the agency will continue to organize a series of online trade conferences with Guangxi, Shandong, Qinghai, Chongqing, and Zhejiang provinces of China. The MoIT and the MARD also informed that a large-scale online conference on the consumption of lychees between Vietnam and China will take place on June 6. In Vietnam, there will be several video casting points in Bac Giang, Lao Cai, Lang Son provinces, Da Nang, and Ho Chi Minh cities. Meanwhile in China, the video casting points will be in Yunnan and Guangxi provinces./. Ministry of Police prosecutes Mon Hue restaurant chain owner for fraud The investigative police agency under the Ministry of Public Security yesterday decided to launch a criminal investigation into the case of “fraudulent appropriation of assets” at Horizon Property Group Company, which is run by businessman Huy Nhat — the owner of the Mon Hue restaurant chain which abruptly shut down in October last year. Before, the Ministry received reports from several foreign investors from China, Singapore, and Hongkong who denounced Huy Nhat to appropriate $25 million in investment capital in relation to a resort project in the central province of Thua Thien-Hue. Nearly end of 2019, multiple outlets of the Vietnamese restaurant chain Mon Hue shut down amid alleged unpaid debts. At the time, many firms, businesses and individuals had denounced Huy Nhat to the Department of Police for fraud and appropriation of property. Groups of foreign investors which had contributed capital to the Horizon Langco project tried to contact him and managers of the company but their efforts were unrewarded. Through investigation, foreign investors realized that it was just a ghost project plus they failed to contact with Huy Nhat; therefore, they decided to denounce Nhat and the company managers to the Ministry of Police. Present, the Ministry of Police is furthering investigation./. S.Korea Kookmin injects US$100 million in Vietnam branches Kookmin Bank’s decision to raise its branches’ registered capital in just a short period of time indicates the bank is optimistic about business prospects in Vietnam. The State Bank of Vietnam (SBV) – Ho Chi Minh Branch has allowed Kookmin Bank – Ho Chi Minh Branch to raise its registered capital from US$70 million to US$100 million, raising the total amount the South Korean bank pumped into its two branches in Vietnam to nearly US$100 million. South Korea-based Kookmin Bank pumped nearly US$100 million into its two branches in Vietnam. Previously, the SBV, the country’s central bank, had approved of Kookmin Bank – Hanoi Branch increasing its registered capital from US$35 million to US$100 million after one year of operation. Kookmin Bank’s decision to raise its branches’ registered capital in just a short period of time indicates the bank’s optimism about business prospects in Vietnam. Among foreign banks currently operating in Vietnam, South Korean banks have been actively expanding investment and operations, due to growing investment capital from South Korean firms to Vietnam. In the first four months of 2020, South Korea took the first spot with regard to the number of investment projects in Vietnam with 265, followed by China with 135 and Japan with 116. In early 2020, the Korea Chamber of Business in Vietnam (KorCham) requested the SBV to issue licenses for more South Korean banks to operate in Vietnam. According to Korcham, a steady provision of capital from South Korean lenders is necessary for South Korean investors to invest in the country. At a national online dialogue between Prime Minister Nguyen Xuan Phuc and the business community on May 9, Korcham Vice President Hong Sun said that South Korean enterprises held high regards for Vietnam’s efforts in improving the business environment. Hong Sun said the Kocham is committed to encouraging high quality FDI inflows from South Korea to Vietnam. “South Korean and Vietnamese firms would foster a stronger bond in establishing new supply chains amid the Covid-19 pandemic,” stated Hong Sun, adding South Korean firms would join Vietnam in its economic recovery efforts./. Hanoi to build square, shopping malls around My Dinh Stadium The city’s Nam Tu Liem district targets to become a modern urban center with comprehensive social and technical infrastructure in terms of services, sports, entertainment and commerce. Hanoi’s authorities plan to build a series of sports – cultural center, square, hotel and shopping malls around the My Dinh National Stadium in Nam Tu Liem district with the target of transforming the district into a modernized urban area with with a focus on services, sports, entertainment and commerce. The orientation is included in the conclusion of its Secretary of the Hanoi Party Committee Vuong Dinh Hue at a meeting with the Party Committee of Nam Tu Liem district on May 7. According to the conclusions, Hanoi’s Party chief agreed on the Nam Tu Liem district’s initiative of opening a night market in Me Tri area to take advantage of a community of 10,000 South Korean expats in the area. Secretary Vuong Dinh Hue also suggested that the district should consider building a mega mall beneath the My Dinh square, in front of the National Stadium, to maximize the advantages and create a comprehensive system that includes sports – cultural center, plaza, hotel and shopping area around the My Dinh National Sports Center. Nam Tu Liem district is requested to submit the overall planning of the area around the My Dinh stadium to the municipal People’s Committee for approval before July. The works on the renovation of the My Dinh National Stadium’s surrounding area include the opening of commercial streets on Dong Bong route to Phu Do cultural center, the promotion of the craft village Phu Do specializing in making vermicelli and the green rice village of Me Tri. This proposal must be completed in June for competent authorities’ approval./. Vietnam turns to India, Nepal to diversify trade markets Vietnam could take advantage of the Vietnamese communities living in these two countries to boost exports. India and Nepal would be potential markets for Vietnam as the country is looking to diversify trade markets and new opportunities out of the Covid-19 pandemic, according to Le Hoang Tai, deputy director of the Ministry of Industry and Trade’s Vietnam Trade Promotion Agency (VIETRADE). “India is a large consumer market thanks to a population of 1.4 billion. However, Vietnam’s export turnover to the country remained at a modest level,” Tai said at an online conference discussing trade promotion activities in India and Nepal on May 20. More importantly, trade relationship between Vietnam and India has a high degree of complementarity, Tai noted, adding the former’s agricultural and food products have high sale potential in India, particularly dragon fruit and catfish, which are fast becoming Indian’s favorite import products. Other products such as coffee, cashew, rubber, and spices, including star anise and cardamom, could be Vietnam’s next key products to India, Tai added. Tai said this is VIETRADE’s third conference on the Indian market within a month, showcasing its growing importance for Vietnam’s trade. According to Tai, both the governments of Vietnam and India recognize the urgency to boost cooperation in expanding production chain in the fields of textile, garment, electronics, and machinery, among others, in which India could be a major source for input materials. In the first four months of 2020, bilateral trade turnover stood at US$2.84 billion, while Vietnam recorded a trade surplus of US$321 million with India. Meanwhile, Vietnam’s trade revenue with Nepal has left much to be desired with just around US$30 million per year. To facilitate export to India and Nepal, Tai suggested Vietnam should take advantage of the Vietnamese communities living in these two countries, with around 500 Vietnamese people living in India and 40 – 50 in Nepal. Tai expressed strong belief that opportunities for Vietnamese firms in these two markets are huge, given growing support from the two governments, the active participation of business communities and the people. In 2019, bilateral trade between Vietnam and India stood at US$11.3 billion while investment from India, the world’s fifth largest economy, in Vietnam remained modest at less than US$1 billion. This year, the two countries target a trade turnover of US$15 billion./. Binh Dinh proposes to continue titanium export due to high inventory The central province of Binh Dinh has proposed the Prime Minister to allow local businesses to continue exporting titanium inventory of about 455,000 tonnes. Phan Cao Thang, permanent vice chairman of Binh Dinh People's Committee, said that the provincial People's Committee has also proposed this titanium inventory would be exported after the local enterprises balance export quantity and domestic consumption. Due to the impact of the COVID-19 pandemic, titanium exporting enterprises in Binh Dinh have had to suspend production and business activities. Therefore, they have faced many difficulties, including a lack of jobs. That has partly affected socio-economic development of the province, vietnamnet.vn reported. The pandemic has also meant most titanium processing plants in the province have not exported titanium that was exploited and processed in previous years. So, the province has had high titanium inventories. Meanwhile, the rent for warehouses and storage has reached billions of dong per year. On July 29, 2019, the People's Committee of Binh Dinh Province proposed the Ministry of Industry and Trade to consider and extend the period of exporting titanium ore inventory according to the ministry’s licence in 2018. The ministry has not yet responded to this issue. Tuna export market still unstable In the difficult economic context caused by the novel coronavirus disease (COVID-19), the Vietnam Association of Seafood Exporters and Producers (VASEP) suggested tuna processors and exporters tap the domestic market. Tuna exporters said that in case Vietnam had been able to control the pandemic, but it still existed in Europe and the US, the tuna export market would be difficult and unstable. In addition, tuna is an “expensive dish” at restaurants for people with high incomes but due to COVID-19, many have lost income, causing consumption to decrease even when the pandemic is controlled. Nguyen Thị Thu Thanh, Director of Sustainable Seafood Limited Company in the southern province of Khanh Hoa, which exports tuna to the US market, said that over the past month, the company purchased about 25-30 billion VND (1.06 million-1.29 million USD) of raw materials but its export volume was about 2-3 billion VND monthly. Despite inventories, businesses still have to pay money to fishermen and interest rates for banks. They also have to suffer soaring electricity costs due to cold storage, which adds a significant burden on costs for businesses. Nguyen Thi Thu Sac, chairwoman of the seafood committee of VASEP, said that Việt Nam was not only a major seafood exporter, but also a potential consumption market of many other countries. The country has a system of restaurants and hotels for international and domestic tourists; population in the age of high consumption; increasing income, especially in urban areas, accompanied by the tendency to choose meals outside. “All create a diversified seafood consumption market,” she said. “Therefore, tuna processors and exporters can exploit this potential.” If we did not take advantage of the domestic market, consumers would choose seafood imported from other countries, she added. Facing this situation, in order to ensure tuna is consumed, localities with ocean tuna fishing fleets have strengthened the consumption solution, helping the fishing and processing industry overcome the difficulties. Specifically, the south-central province of Phu Yen has encouraged businesses to focus on promoting tuna products and boosting domestic consumption through service and tourism activities. At the same time, the provincial People's Committee discourages fishermen from increasing the number of fishing vessels but concentrate on preservation stages to improve the quality of tuna and boost domestic consumption. Especially, a number of restaurants, hotels and large tourist areas of the province have regularly invited culinary experts to perform the demonstration of slaughtering and processing of tuna to serve customers in the past year. These activities have contributed to bring the provincial tuna specialty to many domestic consumers, improving the value and brand of tuna. Facing the current difficulties of the tuna fishing, processing and exporting industry, the Ministry of Agriculture and Rural Development has proposed management agencies and associations to proactively develop scenarios of agricultural and aquatic exports to meet the increasing demand of world consumers when the pandemic is over./. Local firms can compete based on sustainability Local firms are called on to join the fifth programme evaluating and honouring sustainable businesses in Viet Nam on Tuesday in Ha Noi. Co-hosted by the Viet Nam Chamber of Commerce and Industry (VCCI) and the Viet Nam Business Council for Sustainable Development (VBCSD-VCCI) under the direction of the Government directive, the Sustainable Business Index (CSI) continues to be used as a basis for assessing the sustainable development of businesses in the programme. The programme will receive applications from firms of all sizes and industries across the country via offline and online submissions for free. Businesses participating in the programme will declare their information according to the CSI 2020 with 127 indicators in four areas of sustainable development performance index, governance index, environmental index and labour index. The CSI 2020 has been researched and updated by the VBCSD-VCCI and experts in socio-economic fields to comply with requirements from important free trade agreements (FTAs) that the country has signed recently as well as important changes in labour and environmental management policies that have affected the operations of the business. Chairman of VCCI, Vu Tien Loc said: "The programme is not only a contest for marking and awarding the most sustainable firms, but also to change mindsets. Instead of doing business just "for quick profit", the firms will need to think about being a ‘humane business with economic benefits in harmony with social development and environmental protection in the long term.’” He added: “CSI does not include 127 indicators, it is a very scientific and effective business management tool built specifically for Vietnamese businesses, especially the small and medium-sized ones. CSI helps businesses specify the roadmap for sustainable development, answering the questions of how to become sustainable businesses.” The programme, which is jointly implemented by VCCI-VBCSD and the Ministry of Labour, War Invalids and Social Affairs, the Ministry of Natural Resources and Environment, and the Vietnam General Confederation of Labour. Deadline for applications is August 15. According to the organisers, more than 1,500 businesses participated over the last four years and 300 businesses were evaluated as sustainable businesses./. Quang Yen Economic Zone added to coastal EZ planning Prime Minister Nguyen Xuan Phuc has approved adding Quang Yen Economic Zone (EZ) in the northern province of Quang Ninh to the national planning of coastal EZs. The People’s Committee of Quang Ninh Province will be in charge of making planning for the 13,300 ha EZ to ensure its development doesn't harm the or national defence and security, while also preserving the forest and historical and cultural relics. Quang Ninh will also be in charge of attracting appropriate investment into Quang Yen EZ and developing its infrastructure to ensure connectivity between the EZ and others to form a dynamic economic hub for the northern province and the northern key economic region. With the development of the transport infrastructure system in recent years, especially the Ha Long – Hai Phong Expressway and Bach Dang Bridge, Quang Yen has attracted large investments in property development. For example, Ha Long Xanh Complex is set to cover nearly 3,200 hectares with total investment of more than US$7 billion and include a modern, smart and environmentally friendly urban area by 2029. Another project is Amata Agroup’s Song Khoai Industrial Park with a total area of 714 hectares worth $155 million in Quang Yen Town. Under the planning of developing coastal EZs of Viet Nam by 2020 approved in September 2008, 15 coastal EZs were founded. Three were added in 2010. According to the Ministry of Planning and Investment, these 18 existing EZs have a total area of 730,550 ha, or 2 per cent of the country’s area./. Exports to Germany rocket despite COVID-19 The first four months of 2020 saw astounding export growth of various commodity groups, including iron and steel, machinery and sports equipment, to Germany despite the negative impact of the COVID-19 pandemic. According to the General Department of Customs, iron and steel exports were up 27-fold in quantity and 29-fold in value compared to the same period of 2019, reaching US$2 million. Even though the growth is significant, the value gained overall does not affect the total export turnover to the German market. Other billion-dollar groups also witnessed impressive growth. Machinery, equipment, tools and spare parts earned $199 million in value, up 50 per cent. Toys, sports equipment and parts also recorded a 187 per cent growth with a turnover of $46.5 million. Coffee is another bright spot in the picture, having gained 26.5 per cent in value and achieved $176 million in turnover./. Lawmakers divided on debt collecting firms Several deputies called for a ban on debt collecting during a debate between lawmakers at the National Assembly’s session today. Some lawmakers slammed the debt collection industry, citing numerous incidents in which criminal gangs were found behind or closely linked to debt collecting firms and had reportedly terrorised, blackmailed and threatened victims. Deputy Tran Van Tien from Vinh Phuc Province, a supporter of the ban, said debt collection itself wasn't a problem, but the criminal gangs that operated under the guise of those firms were. Tien said a comprehensive report to evaluate the impact of a ban should be carried out. On the other hand, many said debt collecting is a legitimate demand of society and should be allowed to operate provided firms could meet all requirements and follow a code of conducts set by law. A set of rules to oversee firms' activities was needed to prevent similar incidents from taking place, according to lawmakers. Deputy Mai Hong Hai from Hai Phong City said debt collecting firms were needed as current debt settlement regulations and mechanisms remained highly complex and inefficient. Instead of a ban, Hai called for a review of regulations in the field. Deputy Tran Hoang Ngan from HCM City said Viet Nam could learn from existing rules and restrictions on firms’ activities in the US and elsewhere. At the session, lawmakers also voiced concerns over the illegal trade of human fetal tissue for profit. “The NA Standing Committee takes this matter seriously and is considering adding the trade of human fetal tissue to the current ban of human and human body part trafficking,” said Chairman of the NA’s Committee on Economic Affairs Vu Hong Thanh. In another development, the NA Standing Committee added portable water production to the country’s list of businesses that needed special requirements, citing its importance to the public./. Hai Duong exports first batches of lychee to Singapore, US, Australia The northern province of Hai Duong on Monday exported the first batches of lychee to Singapore, the US and Australia. Of which, Ameii Vietnam JSC exported the first 6.5 tonnes of lychees to Singapore while Rong Do Production, Trade and Services Co Ltd also shipped the first 20 tonnes of lychees to Australia and the US. At the same day, a delegation led by Minister of Agriculture and Rural Development Nguyen Xuan Cuong visited a lychee cultivation area in Thanh Son Commune which is granted an area code to export to Japan, and the Ameii Vietnam processing plant in Thanh Xa Commune, Thanh Ha District. Hoang Trung, Director of the Plant Protection Department under the Ministry of Agriculture and Rural Development, said Hai Duong has implemented many solutions for several years to receive export licences for its lychees, especially strict markets like Japan, Australia, and the US. Besides that, in the context of the COVID-19 pandemic, the Government has implemented many solutions on policies and procedures to facilitate lychee exports this year. One of the advantages for exporting lychees this year is that Australia has approved to deploy irradiation in Ha Noi for local fresh fruits, Trung said. In addition, renovation of preservation technology has also created favourable conditions in exporting the fresh fruits to other countries by sea. For the Japanese market, Trung told Vietnam News Agency that: “The first shipment of lychees to Japan will open the door for further entering this market in the future.” “Viet Nam will continue to negotiate with the Japanese side in transferring supervision on lychee exports from Japan's agencies to Viet Nam. That will create favourable conditions for exporting lychees to Japan as well as reduce export costs,” Trung said. Hai Duong is now home to 9,700ha of lychee cultivation, mostly in Thanh Ha District with about 3,600ha and Chi Linh City with 3,900ha. The lychee output in Hai Duong is estimated at 45,000 tonnes this year. Meanwhile, Viet Nam expects to gain a total lychee output of about 230,000 tonnes this year. This province estimates to have a total lychee output of 1,500 tonnes reaching Global GAP standards for export to Europe, the US, Australia, Japan and other demanding markets, according to the Hai Duong Department of Industry and Trade. The total area of growing lychees certified as Viet GAP is over 500ha with an estimated output of 4,000 tonnes. Meanwhile, 19 lychee cultivation areas with a total area of 170ha and a total output of 1,300 tonnes are granted area codes to export lychees to the US, Australia and EU. Many businesses have registered to buy Hai Duong lychees for export and domestic consumption, including expected export volume of about 4,000 tonnes. Of which, the Ameii Vietnam Joint Stock Company has planned to purchase about 1,250 tonnes for domestic consumption at supermarkets and export to Singapore, Japan, Taiwan and Canada. The Rong Do Manufacturing, Trading and Service Co, Ltd has registered to purchase 150 tonnes of lychees for export to the US, Australia, EU and the Middle East. The Bamboo International Joint Stock Company has registered to purchase 1,900 tonnes of lychees for shipment to Japan, Australia, Malaysia, Brunei and China. The Thanh Ha Agricultural and Forestry Processing Export Company has also registered to buy 620 tonnes of lychees for export to the UK, France, Germany and South Korea. Hai Duong expects to gain a growth rate of 30-50 per cent in exporting lychees this year compared to last year. Pham Thanh Hai, director of the Hai Duong Department of Industry and Trade, said in the context of the COVID-19 pandemic, Hai Duong has also paid attention to the domestic market. Of which, the important markets include Ha Noi, HCM City, Da Nang, Can Tho and neighbouring provinces and cities. Hai Duong’s Thanh Ha lychees have been sold in the domestic market, especially at supermarkets, from early this month, which is the start of the lychee harvest season this year, according to the department. They include Bac Tom, Intimex, Metro, Co.opmart, Hapro, BigC, Vinmart and wholesale fruit markets in Ha Noi and HCM City. Besides that, the province has also planned to increase its market share of lychees at some new potential markets in the central and central highlands provinces./. Hau Giang Province overrun with property projects The number of property projects in Hau Giang Province surpasses actual demand, experts have said. Hau Giang Province has 62 real estate projects that have been approved for development in addition to many existing projects, according to the provincial Department of Construction. Vi Thanh City, with a population of around 200,000, has 21 new projects under development, while other cities and districts have around 10. The projects cover hundreds of hectares, consisting of mostly land plots. Many realtors had said there were too many property projects. Nguyen Thanh Nam, general director of T.N.L. Real Estate Company, told Bao Dau Tu newspaper that Hau Giang’s supply of real estate projects was much higher than demand. The province’s population was only 733,000 as of 2019, and had been declining over the years, he said. In addition, real estate businesses were mostly targeting investors that plan to resell their property, as opposed to people who were planning to stay there, he said. Meanwhile, Le Tien Chau, chairman of the province’s People’s Committee, said that while the number of urban areas and property projects was adequate, their quality, scale and connectivity were not up to standards. "Real estate development needs to focus on bettering the lives of locals and urban development should be sustainable. To ensure enough physical space for the future, it should not surpass actual demand," he said. The province said it would improve management of real estate development to ensure that pricing would not be too high compared to locals’ earnings, and that calls for investment are done legally. With an abundance of land and improvements in the investment climate, Hau Giang has been attracting more and more investment projects, especially in real estate./. APEC senior officials hold virtual discussions on economic cooperation Senior officials from the Asia-Pacific Economic Cooperation (APEC) economies held a virtual meeting on May 28 to discuss economic cooperation and open markets to counter the COVID-19 outbreak. The meeting was chaired by Hairil Yahri Yaacob, a senior official from Malaysia's International Trade and Industry Ministry. He urged participating economies to prioritise the undisputed flow of essential goods and services across the region. The official said this was key to ensuring member economies are able to rebound following the wide-ranging economic disruptions caused by the COVID-19 outbreak. Necessary lockdowns and social distancing have been or are still in place region-wide to keep the pandemic from spreading, but the resulting economic slowdown has the potential to cause long-term harms to the lives and livelihoods of millions more, he said. He called the members to exchange views, review their response to the crisis and formulate a possible coordinated approach to collecting and sharing information on policies and measures regarding COVID-19 and its economic effects. Malaysia is slated to host the APEC Summit in November. APEC is a regional economic forum established in 1989 to leverage the growing interdependence of the Asia-Pacific, with 21 members./. VNN |
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BUSINESS NEWS HEADLINES MAY 3007:17 Vietnam at advantage in economic recovery post-COVID-19: Former Deputy PM With success in containing the spread of COVID-19, Vietnam now holds advantages in economic recovery, according to former Deputy Prime Minister Vu Khoan. He wrote in a recent article that however, there are many unforeseeable factors in the world’s situation that can affect Vietnam. Vietnam is building and on the verge of adopting socioeconomic development plans for 2021-2025 and 2021-2030 and vision towards 2045 in the “new normal situation”, he said. He recalled the regional crisis in 1997, when Vietnam was implementing its 1991-2000 socioeconomic development strategy, the global financial crisis in 2008, during its 2001-2010 strategy, and this pandemic, just as the 2011-2020 plan is coming to an end. The less-than-expected annual GDP growth in the ten-year strategies is mostly attributable to unexpected crises, Khoan said, adding that what will happen over the next five, ten, or 25 years is simply unpredictable. Citing the five epidemics, including COVID-19, that have appeared in the first two decades of the 21st century, the former Deputy PM suggested adopting flexible mid-and long-term plans. He also proposed Vietnam include “safe development” in its strategy for the post-COVID-19 period, in addition to sustainable development, with more attention paid to sectors relating to healthcare, such as bio-technology, bacteriology, preventive medicine, and the research, production and reserve of vaccine as well as medicines and medical equipment. The former Deputy PM reiterated the value of time-honoured guiding viewpoints on the importance of internal strength and the need to develop the domestic market, support industry, along with diversifying foreign markets and international supply chains. He highlighted a new opportunity for the country when Vietnam is considered among priority destinations as investors move their production to Southeast Asia, adding that the Politburo’s Resolution No. 50/NQ-TQ on foreign investment orientations issued in 2019 is the lodestar for the utilisation of this opportunity. The former Deputy PM expressed a hope that such sound policies will be implemented promptly and scientifically to optimise the opportunity and help Vietnam post breakthroughs to move ahead. Khoan presented his view on the world situation that the pandemic is taking place at the same time as fierce competition has erupted between major powers in the spheres of economy, politics, and security, and even the pandemic fight, along with climate change. Given this, a global economic recovery looks less V-shaped or W-shaped but more U-shaped, he said, warning that the pandemic, if it breaks out again, may spark a new financial-monetary crisis due to high overspending and high bad and public debt. Khoan forecast that during the post-COVID-19 period, the movement of goods, services, capital, and information will be rebooted but at a rather slow pace, as all countries will prioritise stimulating the domestic market. He highlighted one trend to be adopted by many industrialised nations - relocating their production from China to other regions, especially Southeast Asia and India. The Deputy PM pointed to the ongoing competition between unilateralism and multilateralism and expected that there would be adjustments to certain international institutions, including the WTO, and laws regulating international economic relations. Khoan believes the sustainable development model that combines economic growth with poverty reduction and environmental protection will be maintained after the pandemic passes. However, the model will include more measures to protect people’s health by “distancing”, he said, citing the decision taken by a number of European countries to close streets to motor cars in order to facilitate bike riding, thus improving the environment and limiting contact in public vehicles. Khoan also spoke of the domination of the digital economy and more attention being paid to sectors relating to public healthcare. Regarding international political-strategic relations, he said certain international political and security structures will be changed, and that the situation in some regions, including the East Sea, will become more complex. Conflicts between major powers that had occurred prior to the outbreak of the pandemic will continue for the long-term, he predicted. With an open economy, Vietnam is likely to be impacted by developments in the global economy, Khoan explained./. Vincom Retail forecasts 2020 profit down 12 per cent due to pandemic Shareholders in Vincom Retail have agreed with the company’s 2020 net profit target of VND2.5 trillion (US$107.3 million), a drop of 12 per cent over 2019 due to the COVID-19 pandemic. Total revenue for the whole year is targeted at VND9.9 trillion, up 7 per cent year-on-year. Chairwoman Thai Thi Thanh Hai said the disease had affected customers’ spending habits while social distancing had disrupted retail activity at shopping centres. Ending March, Vincom Retail recorded revenue of nearly VND1.7 trillion and net profit of VND492 billion, down 26 per cent and 19 per cent year-on-year, respectively. It also closed 23 centres in HCM City and Ha Noi out of the 79 centres it has across the country from March 27 and April 22. The company said it would not reduce rents in the long-term but instead share the difficulty with customers with a support package worth VND600 billion to help tenants that had to close during the lockdown period. This year, Vincom Retail will try to stimulate consumption while focusing on opening new megamalls with the target of having 158 shopping centres by 2026. In addition, the company will start leasing and operating a new business model of shopping tourism with the Grand World Phu Quoc complex. With 1,000 shophouses and hotel services, Tran Mai Hoa, general director of Vincom Retail, hopes the combination of tourism, shopping and recreation will offer customers and retailers a new experience and help boost the national economy. Responding to the company’s plan to issue bonds worth total VND4.3 trillion this year, its finance director said the company had cash and cash equivalent of VND3 trillion to meet all current investment needs. The plan was designed to prepare cash for new opportunities or be used for projects that have already gone into operation. Vincom Retail reported total revenue of VND9.26 trillion in 2019, most of which came from leasing real estate and related services worth more than VND7 trillion. Profit after tax reached VND2.85 trillion, up 18 per cent year-on-year. Hanoi aims to lure 38.3 mln USD of investment in first half Hanoi hopes to attract a total investment of 38.3 million USD in the first half of 2020, equivalent to 64 percent of the figure in the same period last year. The capital comes from five new projects totaling nearly 15 million USD, and 10 capital-added projects worth a combined 23.3 million USD. Le Quang Phong, vice head of the Management Board of the Hanoi Industrial and Export Processing Zones said local enterprises have been facing difficulties caused by the COVID-19 pandemic. They are making every effort to diversify material sources for production and seek new consumption markets, towards fulfiling their production targets for the second half and the whole year. According to the management board, industrial and export processing zones in Hanoi generate jobs for nearly 160,000 labourers, including 1,219 foreigners. The capital city led the country in attracting foreign direct investment (FDI) in the first four months of this year, with 4.75 billion USD, or 30.6 percent of the total capital poured into the Vietnamese economy./. VCCI launches annual programme determining sustainable enterprises The Vietnam Chamber of Commerce and Industry (VCCI) kicked off its annual programme on evaluating and identifying sustainable enterprises around the country in Hanoi on May 26. Now in its fifth year, the programme is open for submissions until August 15, with a ceremony to honour selected businesses scheduled for November. According to Pham Hoang Hai from the Vietnam Business Council for Sustainable Development (VBCSD), enterprises in all sectors and of all sizes can lodge a submission, which is free. The 2020 version of the Corporate Sustainable Index (CSI), updated by VBCSD and experts across socio-economic fields, has 127 criteria in the four categories of sustainability, leadership, the environment, and employment. It is in line with FTAs Vietnam has signed recently, such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the EU-Vietnam FTA, as well as with key changes in the country’s management policy regarding labour and the environment. It also includes contents relating to Vietnam’s 17 sustainable development goals and the national action plan to realise the UN’s 2030 Agenda on sustainable growth. VCCI Chairman Vu Tien Loc said the programme is not only a contest but also focuses on creating changes in doing business that balance economic benefits, social development, and environmental protection in the long term. The past four editions of the programme attracted the participation of more than 1,500 enterprises, of which 300 were honoured for their contributions to sustainable growth. ADB approves 400 mln USD loan to support Philippines The Asian Development Bank (ADB) said on May 26 that it has approved a 400 million USD loan to support the Philippine government's efforts to strengthen domestic capital markets and reach its development goals of high, sustained economic growth and poverty reduction. The lender said the Support to Capital Market-Generated Infrastructure Financing Programme, Subprogramme 1, aims to address key constraints that have limited the growth of domestic capital markets, especially government and corporate bond markets. The programme also focuses on building a vibrant domestic institutional investor base. According to the ADB, the development programme will support higher public infrastructure spending for years to come. This new loan brings ADB's total lending to the Philippines to 2.1 billion USD so far this year, the bank added./. Singapore announces fourth stimulus package against COVID-19 Deputy Prime Minister and Finance Minister of Singapore Heng Swee Keat on May 26 announced another 33 billion SGD (23.2 billion USD) supplementary budget, aimed primarily at helping workers and businesses to tide over the COVID-19 crisis and the bleak economic outlook ahead. Keat said the Fortitude Budget, the fourth in less than four months, sets aside 2.9 billion SGD to extend job protection, including enhancements to the Job Support Scheme that co-pays salaries to help firms retain workers. It also provides for the 3.8 billion SGD that went towards measures announced on April 21 to tide Singaporeans over the four-week extension to the 'circuit breaker' to control the spread of coronavirus by limiting people's movements. The Government will also step up public services and recruit more workers to meet long-term demand for preschool education and health care. Of the total four stimulus packages, the Singaporean Government has so far earmarked 92.9 billion SGD, or 19.2 percent of the country’s gross domestic product, in order to cope with the COVID-19 impact./. Vietnam, China hold online discussions on farm produce, food trade Vietnamese and Chinese businesses discussed the trade of farm produce and food during a video conference on May 26. The event was jointly held by the Vietnam Trade Promotion Agency under the Ministry of Industry and Trade, the Vietnam Trade Office in Kunming, and the China Council for the Promotion of International Trade (CCPIT) in Yunnan province. Head of the Vietnam Trade Promotion Agency Vu Ba Phu said Yunnan shares a border with Vietnam and has traditional friendship with many Vietnamese localities, which is important within overall Vietnam-China trade ties. Economic and trade cooperation with the Chinese province has seen encouraging outcomes in recent times, he said, adding that in its annual trade promotion plans for China, the agency gives priority to trade fairs, exhibitions, and the exchange of trade delegations in Yunnan. The agency has also been supporting Vietnamese businesses to further tighten trade relations with their counterparts in Yunnan. Though COVID-19 has been largely controlled in the two countries, traditional bilateral trade is yet to fully resume. Online trade exchanges, therefore, offer opportunities for businesses, especially those involved in farm produce and food, to maintain links. Phu said Vietnam has become a supply centre for farm produce and food in Asia. Many Vietnamese products have improved in quality and price, better meeting the increasing demand of businesses and people in Yunnan. Hu Suo Jin, Minister Counsellor at the Chinese Embassy in Vietnam, said Vietnam and China in general and Yunnan in particular should work closely together and enhance trade promotion activities, not only by traditional methods but also online methods. Meanwhile, Liu Guang Xi, Head of the CCPIT in Yunnan, suggested the two sides increase trade exchanges to help bilateral trade thrive in the time to come./. RoK’s Jin Air to resume flights to destinations in Southeast Asia Low-cost carrier of the Republic of Korea (RoK) Jin Air Co. said it will resume flights on five international routes next month to cater to incoming passengers and meet cargo-carrying demand. Jin Air plans to restart flight services on routes from Incheon to Bangkok (Thailand), Taipei (China), Narita and Osaka (Japan) and Vietnam from June 1, to bring overseas Koreans, those studying abroad and businessmen to the country, the company said in a statement. The company said it will operate one to two flights a week to the five cities from June to also meet cargo-carrying orders, it said. Jin Air has suspended all of its international flights since April, as countries strengthened entry restrictions on incoming passengers to stem the spread of the new coronavirus. But seven domestic routes have been in service despite the virus outbreak. Apart from Jin Air, other budget carriers of the RoK have also planned to resume international flights. Jeju Air said it will reopen flights to Manila in the Philippines in June, while Air Busan and Air Seoul will restore international routes in July./. Vietcombank among Forbes’ top 1,000 listed companies worldwide The Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank) found a place among the 1,000 largest companies in Forbes’ recent “The World’s Largest Public Companies 2020” report, released in its Global 2000 annual rankings. The bank, the only concern from Vietnam to be ranked among the largest 1,000, was listed 937th, up 159 places from 2019. Its ranking in 2015 was 1,985. Vietcombank posted strong profit growth last year, with profit before tax reaching 23.16 trillion VND (994 million USD), up 24 percent year-on-year and surpassing the targeted 12 percent. The result put it among the top 200 banking institutions in the world in terms of profit. Vietcombank is currently the only Vietnamese bank to possess total assets of 50 billion USD and is the most valuable company on the country’s stock market. Vietnam has three other representatives on Forbes’s top 2,000 largest companies: the Bank for Investment and Development of Vietnam (BIDV), Vingroup, and Vietinbank. Forbes’s Global 2000 ranks the 2,000 largest publicly-listed companies worldwide. Ratings are based on scores for revenue, profit, assets, and market capitalisation./. Indonesia: 64 shopping malls in Jakarta to reopen in early June Sixty-four shopping malls across Jakarta will reopen in early June after having been closed since April because of large-scale social restrictions, reported the Jakarta Post. According to the Indonesian Shopping Center Association (APPBI)'s Jakarta chapter chairman, Ellen Hidayat, 60 shopping centers will reopen for business on June 5 and the remaining four on June 8. The move is in accordance with Gubernatorial Decree No. 489/2020 on the PSBB extension in Jakarta, which will end on June 4. Personnel will be deployed to supervise the observance of COVID-19 prevention and control regulations, such as wearing face masks and maintaining physical distance. A shopping mall that can accommodate 1,000 people, for instance, will be allowed to hold only 500 people./. VietinBank plans to increase chartered capital The Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank) planned to increase its chartered capital from its accumulated profits or paying dividend by stocks. The plan is being completed by the competent State agencies to complete the legal procedures for implementation. Chairman of VietinBank’s Board of Directors Le Duc Tho made the statement at its 2020 annual general meeting of shareholders held in Hanoi on May 23. “The capital raising requirement of VietinBank is extremely urgent. Unlike other commercial banks, VietinBank could not raise capital through additional issuance solutions to investors due to its limitations: State ownership in joint stock commercial banks having State capital must not be less than 65 percent while the foreign investors' ownership percentage is a maximum of 30 percent," he said. This year, the bank was assigned a credit growth limit of 8.5 percent by the State Bank of Vietnam (SBV). However, if the economy sees a good recovery, Vietinbank would submit to increase the limit. VietinBank expected outstanding loans to grow by 4-8.5 percent in 2020. The mobilised capital would grow in line with the use of capital, balanced with the growth rate of outstanding loans, expected at 5 to 10 percent. Meanwhile, the non-performing loans (NPL) ratio would be controlled at less than 2 percent. The bank has not set a specific profit target this year, but affirmed to ensure business effectiveness and improve its operation. It will closely follow changes and impacts of COVID-19 to update its profit plan based on the approval of authorities. VietinBank clarified tasks in the restructure plan and resolving bad debts in the 2016-2020 period, improving profitability and renewing business structure, customers and managing growth quality. VietinBank would meet requirements of Basel II as soon as it completes the equity capital increase. Especially, it would complete the development strategy in 2021-30 and middle-term business plan in 2021-2023. It would continue to restructure credit categories, increasing the portion of small-and-medium sized enterprises and retail segments while diversifying revenue structure. “As the global and domestic economy faces many challenges, the whole system of VietinBank will implement practical and effective solutions to support businesses and people to overcome difficulties, having breakthrough developments after the COVID-19 pandemic,” the chairman said. Responding to shareholders’ questions about bad debt, he said that it was difficult to predict the impact of COVID-19 because the pandemic had not been controlled. Influence from other countries would greatly affect an open economy like Vietnam. The bank has implemented necessary support measures to accompany customers to stabilise production and business activities, offering many support programmes. However, many customers of VietinBank are affected by decreasing incomes, affecting consumer loans, business and production. VietinBank’s capital adequacy ratio (CAR) has been at 10 percent according to Basel I and 8.6 percent according to Basel II which is under SBV’s stipulated level. The bank estimated that its profit would reach 6 trillion VND (258 million USD) by the end of the second quarter of the year. The bad debt rate would be controlled at 1.5 percent. VietinBank bought 3.1 trillion VND from Vietnam Asset Management Company (VAMC) while the company still owned over 9 trillion VND, of which over 50 percent has been set aside./. Many key projects in HCM City near completion Many key works in HCM City, including a VND10 trillion (USD434.78 million) anti-flooding project, are expected to be finished this year. At a recent meeting with the municipal People’s Committee Chairman Nguyen Thanh Phong, Nguyen Tam Tien, director of Trung Nam Group which is the anti-flooding project investor, said that to date around 78% of the project has been done to ensure it would be completed as scheduled in October. Pumps will be imported into Vietnam from Germany in the coming four to six weeks. Tien added that difficulties of the project related to capital and administrative procedures have been settled, except for site clearance issues in some districts, including District 4 and Nha Be District. The project is aimed to control flooding for around 6.5 million people who live near Saigon River and some of the city inner districts. Thu Thiem 2 Bridge which is across Saigon River, linking the city centre and Thu Thiem new urban area is also slated for completion in 2020. The project which has a total investment of VND4.26 trillion (USD185.21 million) was started in 2015 and was planned for completion in April, 2018. But site clearance problems have slowed down the pace. Another important project which is also close to completion is the new Mien Dong Station in District 9. The VND4-trillion (USD173.91 million) project is designed to serve more than seven million passengers per year, helping to ease traffic pressure for the city centre. Earlier, Saigon Mechanical Engineering Corporation (Samco) proposed the HCM City authorities to inaugurate the station by late April, however, due to the Covid-19 pandemic, this has been delayed. Dong Thap farmers lose crops to saline contamination Farmers in Hong Ngu District, Dong Thap Province, are struggling as the rice fields keep dying from saline contamination. "After growing normally for a while, the rice started dying en mass once they were given more water," said Le Van Xuong from Thuong Thoi Tien Town, Hong Ngu District. He went on to say that he still tried to plant the second crop and invested VND60m in it. But the rice still died. He tried the third time on May 20, hoping that he will earn enough just to offset the loss. Nguyen Van Rubi, Xuong's neighbour, said he lost 17,000 square metres of crops twice in a month. Other families who work on the 2,600ha rice paddies in Thuong Thoi Tien and Thuong Phuoc 2 towns also face the same situation. Ca Huu Tam, a seasoned farmer said hundreds of ha of rice had died. They are mostly grown near Giong Nen, Dia Rung and Suong Lung Tuong channels and the area near pumping station behind Thuong Thoi Tien's old headquarter. Pham Hong Cuong, deputy head of the Hong Ngu District Department of Agriculture and Rural Development, confirmed that the rice has been dying in their area. According to Cuong, extreme weather is also the cause of the problem. After an initial investigation, it was concluded that because of the drought, the rice fields are left too dry and were contaminated with saline. The solution is to pump water in to clean the fields. However, many farmers disagreed, saying that the fields were contaminated because fish farmers used industrial feed. Dozens of fish farms discharge wastewater into the channels which provide water to the rice fields. The farmers also invited a group of agricultural engineers from Can Tho University to survey the fields. The farmers were surprised when they were told that the rice died from saline contamination because Hong Ngu is on the upstream of the Mekong River and 200km away from the west coast. The salinity level recorded on May 15 was 3-6ppt in the fields, 1ppt in the channels and 6ppt in the fish farms. Nguyen Phuoc Tuyen, an independent agricultural researcher in Dong Thap said Thuong Thoi Tien was 3.5 metres higher than the sea level so it's impossible for a saline intrusion. He said he was not surprised that the salinity in the fish farms was 6ppt because the amount of salt in industrial feed accounts for 1-2%. However, Tuyen thinks that the rapid death of the rice fields was caused by both extreme weather and fish farm activities. JUTEC seeks investment opportunities in Vietnamese real estate JUTEC Corporation of Japan is planning to co-operate alongside a Vietnamese partner as they seek to set up a joint venture, with JUTEC set to contribute 50% to expand its business operation in the local real estate market. The joint venture is expected to offer management and operation services for apartments that fall in line with Japanese standards in order to provide the best possible experience for foreign customers who are currently living and working in Vietnam. Moreover, the JV will see a wave of imports through the added supply of new Japanese construction materials to be used in the Vietnamese market. Originally established in 1923, JUTEC is an enterprise that specialises in offering high quality equipment and building materials to be used in civil and housing projects in the Far East country. The company first entered the Vietnamese market back in 2015 when it established a representative office locally. Since entering the domestic market, JUTEC has largely focused on studying various markets and seeking new investment opportunities. In anticipation of the increasing demand for serviced apartments among foreign experts and the demand for new construction materials domestically, it has decided to establish a new joint venture in the country. CSI an effective support tool for businesses after COVID-19 pandemic The Corporate Sustainability Index (CSI) is anticipated to play an important role in socio-economic development moving forward into the period following the novel coronavirus (COVID-19), helping local firms to enhance their ability to cope with and recover from a variety of scenarios. The Vietnam Chamber of Commerce and Industry (VCCI) launched a scheme on May 26 regarding an evaluation and announcement of sustainable businesses based in Vietnam this year. In line with this programme, the Vietnam Business Council for Sustainable Development have joined with leading experts in various socio-economic development fields to update the Corporate Sustainability Index (CSI) with new points to follow the requirements of important free trade agreements that the country has recently signed. In addition, updates reflect the significant changes which have occurred in influential labour and environmental management policies that have had a major impact on the operations of domestic enterprises. Most notably, issues relating to the 17 sustainable development goals and the overall national action plan under the 2030 Agenda for Sustainable Development have been simplified and integrated into the CSI set 2020. During his speech at the launching ceremony, Vu Tien Loc, VCCI Chairman and the Chairman of the Vietnam Business Council for Sustainable Development, shared, “The programme aims to change the mindset and way of doing business for ‘immediate profit’ by running firms in harmony with economic benefits, social development, and environmental protection in the long term. The CSI set not only reflects 127 indicators, but is a very scientific and effective business management tool built specifically for Vietnamese enterprises, especially small and medium-sized businesses.” Following this, the VCCI Chairman revealed that the COVID-19 pandemic has shown the gaps that exist in economic management and operation, thereby displaying the importance and urgency of sustainable development. In this context, the scheme regarding the CSI set has played an extremely important role in terms of socio-economic development. The greater number of businesses that apply the CSI, the more professional and corporate governance activities will be, thereby helping firms to improve their competitiveness and ultimately enhance their ability to cope with and adapt to different scenarios. Loc suggested the companies put the CSI into the focus of their corporate governance strategies whilst simultaneously preparing a sustainable development report, promptly detecting weaknesses and shortcomings that occur in the process of production and business as a means of seizing potential opportunities for greater investment in the future. Tiki hard-pressed to whip up new investment Tiki's merger with Sendo and designs to list on the local stock exchange could be solutions to increasing difficulties in mobilising investment to carry on the war of attrition in e-commerce. The Vietnamese e-commerce playground was astonished by the merger between Tiki and Sendo, which took place after Tiki declared its plan to stage an initial public offering a few weeks ago. The two news have raised doubts over the e-commerce platform's ability to mobilise new investment to continue the “money burning” race after 10 years. As of the end of 2018, its accumulated losses were about VND1.4 trillion ($60.87 million). Moreover, Tiki also burned through the entire VND506.3 billion ($22 million) capital of VNG – its largest shareholder with 24.6 per cent. Otherwise, constantly welcoming new investments has fragmented the e-commerce platform’s shareholder structure. Tiki raised capital in June and December last year. Along with VNG, China-based JD.com is also its main shareholder with 21 per cent. The others include Ubiquitous Traders Pte., Ltd. (nearly 9 per cent), CyberAgent, STIC, and Sumitomo. Tiki has not issued public communications or responded to queries about the deals. To conquer the market, e-commerce players have been increasing capital and racking up deficits year after year to keep growing. According to the latest statistics of security company VNDIRECT, each e-commerce company has to suffer a loss of VND124 billion ($5.4 million) to gain 1 per cent of market share from the competition. Regarding its merger with Sendo, Nguyen Viet Hung, a key opinion leader with a hand in a number of local technology startups, said that the deal may be a good fit for the two local companies as e-commerce firms as it may not only eliminate one competitor but also create a new partnership with stronger financial potential to compete. After the failure of WeWork, many investors are now focusing on the profitability of startups, instead of their growth potential. That may be the main reason behind Tiki has not been very attractive to investors. Forming alliances and proposing an IPO could both be meant as remedies for this. Honda import strategy unable to avail of fee cuts Japanese carmaker Honda may come to rue its decision to start importing CR-V vehicles, giving up domestic assembly, now that the government has greenlit a 50 per cent cut in registration fees for locally assembled automobiles as part of a new initiative to help the market find its feet amidst the coronavirus pandemic. Prime Minister Nguyen Xuan Phuc has agreed to slash registration fees for locally-manufactured vehicles, which could represent up to 12 per cent of the vehicle cost, to work up purchasing interest that has been languishing during the COVID-19 outbreak. The registration fee cut, valid until the end of 2020, is not applied for imported vehicles. This will create advantages for domestically produced vehicles as well as help customers save thousands of dollars. In the list of 154 models subject to registration fee adjustment under Decision No.452/QD-BTC effective from April 3 on adjusting registration fees for automobiles and motorbikes, registration fees for passenger cars or cars with less than nine seats were 12 per cent in eight provinces and cities (Hanoi, Quang Ninh, Haiphong, Lao Cai, Cao Bang, Lang Son, Son La, and Can Tho), while it is 11 per cent in Ha Tinh and 10 per cent in Ho Chi Minh City, Danang, and other cities. The charge is now 7.2 per cent for a pickup truck in the first group of cities/provinces, 6.6 per cent in Ha Tinh, and 6 per cent in other cities. After years of making stellar profits in the Vietnamese market, in 2018 Honda shifted to import some models instead of assembling them locally to enjoy tax incentives under the ASEAN Free Trade Area. On account of the registration fee cut, however, many dealers say that the Honda CR-V will lose many of its advantages and even have to join a price war with domestically assembled vehicles. CR-V vehicles are now priced between VND983 million ($42,700) and VND1.1 billion ($47,500), and customers in Hanoi have to pay VND118-131 million ($5,100-5,700) registration fee, while customers only need to pay about VND60 million ($2,600) for a locally built rival Mazda CX-5 or a Hyundai, as registration fees have been cut by 50 per cent for domestically-produced cars. This shows that the future of Honda CR-V in Vietnam is uncertain as price is still a determining factor in sales in the market. Numerous specialists were of the opinion that imported completely built units would lose their advantage and producers may have to cut costs in order to stay competitive. Meanwhile, early this month, Honda Vietnam said that it may shift from manufacturing to importing vehicles due to the interruption of manufacturing activities and market stagnation caused by the COVID-19 pandemic. Honda Vietnam proposed measures to continue removing difficulties for motorbike and car manufacturers by extending deadlines for their tax and land leasing payments. This is not the first time that Honda Vietnam has floated this idea. While a decision is yet to be made on the proposal, the company’s calculations seem to go straight against the flow of other carmakers who are expanding factories in Vietnam as the country seeks to reduce its reliance on imports. Earlier this year, Ford announced plans to invest $82 million to triple the capacity of its plant in the northern province of Hai Duong from 14,000 to 40,000 vehicles a year. Vietnamese manufacturer Thanh Cong Motors reached an agreement with South Korea’s Hyundai to build a second plant in the northeastern province of Quang Ninh after the first in the nearby province of Ninh Binh. Truong Hai Auto has also built a Kia assembly plant since last September, following assembly lines for Peugeot earlier in the same year, and for Mazda in 2018. Other locally-invested giant VinFast completed the first phase of its car manufacturing plant in the northern city of Haiphong last June with a capacity of 250,000 units a year. According to the Vietnam Automobile Manufacturers Association (VAMA), car sales hit a five-year low, dropping 36 per cent on-year to about 61,000 units in the first four months of this year due to the slump in demand triggered by the COVID-19 pandemic. Thus, the VAMA proposed the government to consider relaxing and reducing taxes for car-makers, both to support maintaining production and to stimulate consumption. The proposed measures include a 50 per cent reduction in VAT and a 50 per cent registration fee for automobiles to stimulate consumption, the latter of which has just been approved. Japan’s JUTEC Corp. to enter local real estate market Japanese building product distributor JUTEC Holdings Corporation will team up with a Vietnamese partner to establish a housing services joint venture in Vietnam. The company, in which JUTEC will hold 50 percent, will offer apartment management and operations services following Japanese standards, to bring the best experience possible to foreigners working and living in Vietnam. It will also import modern Japanese construction materials for distribution in the Vietnamese market. The joint venture will cater to demand for apartments for lease, targeting foreign experts, and promote new building materials in Vietnam. Founded in 1923, JUTEC had 778 employees as of April, with capital of 850 million JPY (7.9 million USD). It arrived in Vietnam in 2015 via opening a representative office to study the local market./. Vietnam cuts aviation fees to support coronavirus-hit enterprises The Ministry of Finance has decided to temporarily slash a number of charges and fees within the aviation sector in order to support those affected by the coronavirus outbreak. Under a circular issued on May 27, a 10% cut will be offered to individuals and organisations using airport infrastructure and providing flight operation services, airport businesses, and those on foreign flights leaving and arriving at Vietnamese airports. At the same time, those providing verification for granting certificates and licenses in civil aviation activities and entry permits to restricted areas at airports will have their fees reduced by 20%. The circular is valid until the end of 2020 and the fees and charges will return to the normal levels in 2021. VN Government issues decree on ODA management and use The government has recently issued Decree No. 56/2020/NĐ-CP on management and use of official development assistance (ODA) and concessional loans granted by foreign sponsors to Vietnam. Accordingly, foreign sponsors can be foreign governments, international organisations, inter-government or international organisations, and governmental organisations authorised by foreign governments. Methods for the provision of ODA and soft loans include programme, project, non-project and budget assistance. Regarding the usage of non-refundable ODA, priority will be given to socio-economic infrastructure programmes and projects; capacity building; supporting formulation of policies, institutions and reforms; prevention and mitigation of natural disasters and response to climate change; social security; among others. ODA loans will be used for execution of programmes and projects in healthcare, education and vocational training, climate change adaption, environment protection, and essential infrastructure that are not able to produce paybacks. The ODA and concessional loans shall not be used for regular spending, payment of fees, taxes and interests, or purchase of cars (except for those approved by competent authorities) and site clearance, among others. The decree also outlines rules to prevent and deal with corruption, losses and wastefulness in management and use of ODA and soft loans in accordance with law. It took effect from May 25. Singapore’s pharmaceutical exports surge thanks to high stockpiling Singapore’s exports of pharmaceutical products have surged since the beginning of this year, as the COVID-19 pandemic fosters worldwide stockpiling of drug ingredients. The country’s pharmaceutical output has increased by 86 percent so far this year, with April’s shipments surging 174 percent year-on-year. According to Fitch Solutions, Singapore is one of the few countries in the world that exports more pharmaceuticals than it imports. The nation has more than 50 manufacturing facilities, including plants owned by eight of the world’s 10 biggest pharma firms. The US, Europe and Japan were Singapore’s biggest export destinations for active pharmaceutical ingredients (APIs) in recent months. How Ti Hwei, President of the Singapore Association of Pharmaceutical Industries, said that companies and governments around the world are building large inventories of APIs and drugs to ensure supplies of medicines remain uninterrupted and can be made close to market. Singapore’s biomedical industry, which employs more than 24,000 people, accounted for about 20 percent of the manufacturing sector in 2019 which in turn made up about a fifth of GDP. Petrol prices continue to rise in latest adjustment Retail petrol prices were adjusted upwards on May 28 in the latest review by the Ministry of Industry and Trade and the Ministry of Finance. From 3pm on May 28, the price of E5 RON92 biofuel rose 882 VND to a maximum of 12,402 VND (0.53 USD) per litre and RON95-III by 890 VND to 13,125 VND (0.56 USD) per litre. Prices of diesel 0.05S and kerosene, meanwhile, are now 10,749 VND and 8,757 VND per litre, up 892 VND and 875 VND per litre, respectively. Mazut 180CST 3.5S is now selling for 9,492 VND per kg, up 947 VND per kg. The two ministries review fuel prices every 15 days and make adjustments in accordance with fluctuations in the global market. As the COVID-19 pandemic is showing signs of easing in the world, many countries have begun to resume production and business activities, pushing up demand for fuel, resulting in rising prices of petrol and oil./. Auto makers in Indonesia to resume operations in June Automobile manufacturers in Indonesia are ready to resume production in June following the government’s enforcement of the “new normal” scenario, said Chairman of the Association of Indonesian Automotive Manufacturers (Gaikindo) Yohannes Nangoi. Toyota Motor Marketing Director Anton Jimmi said the firm is set to resume activities on June 1, adding that it will closely follow the government’s regulations on COVID-19 prevention and control. PT Toyota Astra Motor also announced to restart production at the same time. Its head office is in Jakarta, so it is waiting for the city’s decision on the Large Scale Social Restriction (PSBB) policy to set the exact time of resumption. Toyota Motor Manufacturing Indonesia Director of Administration, Corporations and External Relations Bob Azam said that the company had plans to resume operation at the beginning of June. In the early phase, however, production lines will run at 50 percent of capacity and physical distancing measures will be applied among workers, he added./. Malaysian economy capable of positive growth in 2020 The Malaysian Islamic Party’s Central Committee on Economic, Real Estate and Entrepreneur Development has predicted that the country’s GDP growth rate can reach 2.5-3 percent in 2020 despite the COVID-19 outbreak. Although it is a drastic reduction of pre-pandemic forecasts and the lowest since 2009, the projection runs counter to several recent predictions that the Malaysian economy would actually shrink by up to 1.0 percent. Vice Chairman of the committee Mazli Noor said that the 0.7 percent GDP growth registered in the first quarter is reflective of the country’s resilience in the context of the ongoing pandemic. The relatively modest performance for the first quarter of 2020 is supported by the services and manufacturing sectors, which grew 3.1 percent and 1.5 percent respectively, with other sectors experiencing varying degrees of deficits. He said that services, manufacturing and construction will play a major role in the nation’s growth. Supported by the government's Prihatin Economic Stimulus Package that was announced earlier, the committee is projecting a 5.0 percent to 5.5 percent growth in the services sector this year, with manufacturing coming in at around 3.0 percent and construction contributing an estimated 1.0 percent to the nation’s economic growth. The recently announced conditional movement control order (CMCO), which allows for a more flexible and deliberate reopening of the economic sector, also provides much-needed room for economic activities to resume, he added. The committee agrees with analyst projections of a full economic and value chain recovery by the second half of 2020, with the construction sector - particularly that involving government public infrastructures - being allowed to return to full speed./ Pork prices continue rocketing Pork prices in Vietnam have kept on increasing, reaching the record high because of local supply shortages. According to CP Vietnam Livestock Joint Stock Company, by May 27, pig prices rose to VND81,000 (USD3.52) per kilo, VND10,000 higher than that during mid-May. Meanwhile, many other pig breeding companies raised the product price to VND82,000 per kilo. On May 28, pig prices in many northern localities surged to between VND97,000-105,000 per kilo, including Hung Yen and Thai Binh provinces. Pork prices have seen the historical peak of from VND170,000-200,000 per kilo, roughly VND10,000 higher than a kilo of pork just a few days ago. The prices are higher by between VND10,000-70,000 per kilo at supermarkets. Vissan-branded pork products are the most expensive of being even up to VND280,000 per kilo of ribs. Thu Cuc from Hoang Mai District said that she was quite shocked to see the sharp rise in pork prices recently. Her family has reduced the pork use to save the daily expenditure and turned into other kinds of foodstuff. Under the government’s instruction, on April 1, 15 large livestock companies pledged to cut pig prices around VND60,000-65,000 by the end of the second and third quarter of this year. However, the target has failed. According to the Ministry of Agriculture and Rural Development, since the beginning of the year, African swine fever has resurfaced in 155 communes of 20 cities and provinces, causing nearly 4,000 pigs to be culled. This has seriously slowed down the livestock to increase which is expected to help ease the domestic market’s pork deficiency by the end of this year. Buying piglets of unclear origin to raise has been among the major reasons for the reoccurrence of African swine fever. In the first four months of this year, localities have ensured around 80% of the set population target. The country witnessed an on-year rise of 300% in pork imports between January and mid-May. Nation racks up US$1.9 billion trade surplus over five-month period Vietnam has recorded a trade surplus of US$1.9 billion during the first five months of the year despite the COVID-19 impact, according to the latest statistics released by the General Statistics Office (GSO) on May 29. The GSO said the total import and export turnover during the reviewed period dropped by 2.8% to US$196.84 billion in comparison to the same period from last year. Elsewhere the five-month period saw the export turnover of goods in the domestic sector enjoy an increase of 10.4% to US$33.3 billion, while the foreign invested sector grossed approximately US$66.06 billion, representing a decline of 6.9% on-year and accounting for 66.5% of the total export turnover figure. In total, 17 items witnessed export turnover exceeding US$1 billion, making up 82% of total export turnover. They included phones and components, electronics, computers and components, textiles and garments, machinery, equipment and spare parts, along with footwear and wooden products. Despite this large sum, the export turnover of a number of agricultural products suffered a downward trajectory in comparison with last year. As a result, the export value of fruit and vegetables fell by 10.3% to US$1.6 billion, while the export of rubber and pepper dropped by 29.6% and 17.9% to US$470 million and US$309 million, respectively. By contrast, a range of agricultural products enjoyed an increase in export turnover, including rice with US$1.4 billion, coffee with US$1.4 billion, and cashew nuts with US$1.2 billion. With regard to the export commodity market, the United States remained as Vietnam’s largest export market during the five-month period, with turnover enjoying an annual surge of 8.2% to US$24.6 billion, followed by China with US$16.3 billion, representing an increase of 20.1%. Export revenue from the EU, ASEAN, and the Republic of Korean (RoK) markets suffered falls of 12%, 13.4%, and 0.5%, respectively, while the Japanese market saw an increase of 2.2% to US$8.1 billion in export turnover. Elsewhere, Vietnam imported goods with a total value of US$97.48 billion, representing a decline of 3.8% on-year. At present, China remains the country’s largest importer with an estimated turnover of US$28.9 billion, a fall of 3% from the same period last year, trailed by the RoK, ASEAN, Japan, the US, and the EU. Nearly 6,500 tonnes of fresh lychee exported via Kim Thanh Border Gate Since the beginning of the season, nearly 6,500 tonnes of fresh lychees, worth more than US$3.6 million in total, have been exported to China through Kim Thanh Border Gate in Lao Cai Province, up 37% in volume and 39% in value compared to the same period last year. This was announced by the border gate’s customs sub-department on May 28. At the border gate, trucks loaded with fresh lychee for the Chinese market have been given priority for customs clearance to ensure the highest quality of the fruit. Beside lychee, Kim Thanh Border Gate has also processed customs clearance for other fruits including dragon fruit (around 178,300 tonnes worth nearly US$118 million), banana (17,700 tonnes, US$2.5 million), mango (42,100 tonnes, US$54.2 million), and watermelon (12,00 tonnes, US$12 million). The Management Board of Lao Cai Economic Zone has closely co-ordinated with the provincial border guards to create the most favourable conditions for the export of fruits and agricultural products while strictly observing preventative measures against COVID-19 epidemic. An average of 400 trucks pass through Lao Cai’s border gates each day, with more than half of them carrying Vietnamese agricultural products for export to China. Adjusting growth targets During the ninth session of the 14th National Assembly, the Government officially proposed that legislature consider to adjust some growth targets for 2020, including GDP growth, State budget revenue and public debt. In addition, the Government cautiously recommended the NA consider and adopt the guideline on several specific mechanisms and policies to revive the economy in the new situation. Accordingly, the Government asked for the NA’s permission to proactively adjust the 2020 public investment plans among ministries, sectors and localities within the expenditure estimate on development investment; convert the investment mode for important transport projects from that of a public-private partnership to the use of the state budget; exempt and reduce a number of tax obligations concerning the areas and subjects suffering heavy losses due to COVID-19; postpone the increase of basic salary for civil servants, public employees and the armed forces and pensions from July 1, 2020; and consider launching new economic stimulus packages if the pandemic continues to be prolonged on a global scale. According to the NA-assigned targets, Vietnam’s GDP growth rate in 2020 will be 6.8% while inflation will be kept below 4%. However, the unexpected outbreak of COVID-19 in more than 200 countries around the world has made this goal a major challenge which, as assessed by the Government, is difficult to be achieved. Given that fact, the proposal to adjust the growth targets is necessary and consistent with objective reality, looking directly at the socio-economic situation and forecasting the international and domestic situation in the near future. Under the Government’s updated scenario, the country’s GDP will grow by about 4.5% in 2020. The Government has also set a higher growth target of 5.4% in the event of a favourable global situation, with the disease being put under control and the global market recovering. Meanwhile, the consumer price index (CPI) for the whole year will rise by 4% on average; total state budget revenue will see a reduction of VND163 trillion (US$7.04 billion) compared to the assigned estimate; state budget deficit will be equal to about 4.75% of GDP; and public debt will equal 55.5% of GDP. The two targets for state budget deficit and the debt-to-GDP ratio will increase by 1.31% and 3.2%, respectively, compared to the initial targets. In the context that the global economy is predicted to fall into a more serious recession than previous crises, the Government’s growth target of over 5% holds great significance. It is not only a sufficient threshold to deal with employment for workers, maintain people’s quality of life and ensure social security, but is also a needed level to fulfil the average growth target of 6.5. % set for the period of 2016-2020. However, the enclosed risk is that adjusting up the budget deficit will lead the nation to borrow more, thus influencing public debt and, furthermore, this may affect the maintenance of macroeconomic stability – a very important foundation that Vietnam has achieved in the past ten years. This is the most disturbing problem. The adjustment of socio-economic targets is a big and unprecedented issue, because the targets set in the NA’s Resolution are concretised from the Resolution of the Party Central Committee. On the basis of the Government’s proposal, the decision on the adjustment of growth targets will be made by the competent levels, with the current political and legal bases taken into account. According to economic experts, the adjustment of GDP growth target and relevant macro targets in accordance with the new developments in the domestic and international socio-economic situations will create favourable conditions for the Government in its management work, towards realising the dual goal of successfully combating the pandemic and reviving the economy after the disease. |
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More giant foreign firms plan to shift investment into Vietnam07:30 Vietnam is expected to see a new foreign direct investment (FDI) wave as more foreign companies plan to move investment into the country.  The US-China trade has triggered the trend of shifting production lines from China to Southeast Asia and other markets, including Vietnam which was seen as a promising destination. Meanwhile, many countries are fighting against the Covid-19 pandemic while Vietnam has basically controlled the disease, while maintaining its economic growth momentum. Pegatron, Amazon and Home Depot have started recruiting and seeking to open new supply chains with Vietnam being among potential markets. Other US giants like Google and Microsoft have announced their plans to relocate their production facilities of new phones, personal computers and some other devices from China to Southeast Asia with factories in Vietnam and Thailand expected to be the beneficiaries, the Nikkei Asian Review reported. Microsoft is scheduled to start producing its Surface line, including notebook and desktop computers, in the northern region of Vietnam in the second quarter of this year at the earliest, according to the Nikkei Asian Review. Since late February this year, Apple has announced recruitment notices in Vietnam for a number of positions in HCM City and Hanoi on its official website. In a recent move, Taipei-listed Wistron Corporation, another manufacturing partner, also chose Vietnam as part of its USD1 billion expansion plan for this year and the next, along with India and Mexico, Bloomberg said. GoerTek, one of Apple’s important manufacturing partners in China, which has two assembly plants in Que Vo Industrial Park in Bac Ninh Province revealed in March that it was preparing to establish a unit in Vietnam. Dr Le Dang Doanh, former head of the Central Institute for Economic Management, said that it is essential to select hi-tech FDI projects for the high economic value and environmental protection. Doanh suggested that Vietnam needs to boost administrative reform to lure investors. He cited a report by the Vietnam Chamber of Commerce and Industry as saying that up to 54% of Vietnamese company admitted paying bribes for administrative procedures to be quickly completed. The country needs to improve the infrastructure network which remained limited, while logistics fees, including road fees, are still quite high. However, Vietnam has a young labour force which needs to master the skills suitable for new and ever-changing jobs. Dan Viet/Dtinews |
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Vietnam among most successful Asian countries in containing coronavirus: Foreign media06:01 The Australia-based website Eastasiaforum.org on May 28 ran an article titled “Vietnam’s COVID-19 political gains” affirming that Vietnam has earned international accolades as one of the successful countries in Asia to contain the coronavirus.
According to the author, Vietnam may win more than international praise, especially in political terms. The country has been highly transparent in its response to the crisis through broadcasting regularly on television and keeping its citizens updated on the pandemic via text messages, the article wrote, adding that national media is being inundated with public praise over the effectiveness of government and the Party. It affirmed that the effectiveness of the Communist Party of Vietnam’s leadership during the COVID-19 pandemic has helped boost the country’s prestige in the international arena. With only a fraction of the healthcare budget of other successful countries, the performance of Vietnam’s healthcare services is surprising, as it not only has successfully contained the virus, but also has donated medical supplies to other countries. The article stressed that the support reflects the country’s international spirit and sense of responsibility, especially when it is currently the chair of ASEAN and a non-permanent member of the United Nations Security Council. The author also said that Vietnam will likely bounce back quickly after the pandemic thanks to government efficiency and resilience during the crisis. Vietnam’s success in containing the pandemic will make it a good destination for Western firms to invest during the post-coronavirus period, especially firms from the United States or Europe. East Asia Forum is a platform for analysis and research on politics, economics, business, law, security, international relations and society relevant to public policy, centred on the Asia Pacific region. East Asia Forum is catalogued and archived by the National Library of Australia. Vietnam goes through 45 days without community infections No new COVID-19 case was recorded in Vietnam overnight, leaving the total at 328 as of 6am on May 31, according to the National Steering Committee for COVID-19 Prevention and Control. Vietnam has gone through 45 days in a row without community transmission. Among the 328 cases confirmed so far, 188 were imported. A total of 279 COVID-19 patients or 85 percent have fully recovered, while the remaining 49 are being treated at central and provincial health facilities in a stable condition. Of those, nine have tested negative for SARS-CoV-2 once, and 17 negative at least twice. As many as 7,870 people who had close contact with COVID-19 patients or returned from pandemic-hit areas are under health monitoring, of whom 69 were quarantined at hospitals, 6,870 at other concentrated facilities and 931 at home and place of residence./. VNA |
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Vietnam objects to China’s vegetable cultivation in Hoang Sa archipelago06:08 Vice Spokesman of the Foreign Ministry Doan Khac Viet on May 28 repeated that all activities without Vietnam’s permission in the Hoang Sa (Paracel) and Truong Sa (Spratly) archipelagos are valueless.
He made the remarks at the ministry’s regular press conference, during which he replied to reporters’ questions about China’s recent announcement of using new technology in vegetable cultivation on Phu Lam Island of Vietnam’s Hoang Sa archipelago. The Vice Spokesman noted Vietnam has repeatedly asserted that it has sufficient historical evidence and legal basis testifying to its indisputable sovereignty over Hoang Sa and Truong Sa, which is in conformity with international law. All activities without Vietnam’s permission in these archipelagos are valueless, Viet emphasised. Regarding China’s illegal sand mining in the East Sea, he once again affirmed that Vietnam owns sufficient historical evidence and legal basis testifying to its indisputable sovereignty over Hoang Sa and Truong Sa, as well as its exclusive economic zone and continental shelf in the East Sea. Any parties’ activities in these two archipelagoes and the areas over which Vietnam has sovereign rights and jurisdiction in the East Sea are violations of the country’s sovereignty and sovereign rights, as well as international law, the Vice Spokesman added. Vice Spokesman: foreign enterprises must comply with Vietnam’s laws Vietnam always creates conditions for foreign enterprises to do business in the country, and they must comply with Vietnam’s laws, Vice Foreign Ministry Spokesman Doan Khac Viet has said. "Any legal violation behaviour will be punished," he affirmed at the ministry’s regular press conference in Hanoi on May 28. In response to reporters’ queries about the alleged bribery case involving Japan’s Tenma company based in the northern province of Bac Ninh, Viet said the Vietnamese Embassy in Japan has reported to authorities at home and Vietnamese competent agencies are investigating the case in line with local regulations. Regarding the information that some Vietnamese taxation and customs officers received 25 million JPY (231,900 USD) from Tenma company, he said Prime Minister Nguyen Xuan Phuc had assigned relevant agencies to promptly investigate the case. The Bac Ninh police are also joining in the investigation while leaders of the Finance Ministry have directed the suspension of several a number of officials involved in the case, he added. Granting of e-visas part of admin reform in entry, exit management The recent decision to grant e-visas to citizens from 80 countries is part of efforts in administrative reform regarding entry and exit management, helping to bolster investment attraction, socio-economic development, tourism, diplomacy, and defence and security. Vice Foreign Ministry Spokesman Doan Khac Viet made the remarks at the ministry’s regular press conference on May 28 in reply to reporters’ questions about Vietnam granting e-visas for citizens from the 80 countries from July 1. He noted that based on the law amending and supplementing some articles of the law on entry, exit, transit and residence of foreigners in Vietnam, approved by the National Assembly on November 25, 2019, the Government recently issued a resolution on the list of countries whose citizens are entitled to an e-visa and the list of international ports of entry via which foreigners with e-visas can enter and exit the country. This resolution will take effect on July 1. The issuance of the resolution aims to carry out Vietnam’s administrative reform policy, especially in entry and exit management, thereby creating additional conditions for investment attraction, socio-economic development, tourism, diplomacy, and defence and security, according to Viet. Vietnam considering loosening immigration policies, resuming flights Vice Foreign Ministry Spokesman Doan Khac Viet has said ministries and agencies are preparing a proposal to the National Steering Committee on COVID-19 Prevention and Control and the Prime Minister to loosen immigration policies and resume a number of air routes, trade, tourism, and investment, with an eye kept on developments of the pandemic in the country and the world. During the ministry’s regular press conference in Hanoi on May 18, Viet said the move is in compliance with the Prime Minister’s direction. His statement was in response to reporters’ questions about when Vietnam will resume transport links and trade with foreign countries./. Foreign Ministry: Vietnam recovers economy during, after COVID-19 Vietnam has adopted synchronous policies and measures to recover its economy both during and after the COVID-19 pandemic, Vice Foreign Ministry Spokesman Doan Khac Viet has said. During the ministry’s regular press conference in Hanoi on May 28, Viet said Vietnam has controlled and repelled the pandemic via drastic and effective action despite complex developments in the region and the world, thus laying an important foundation for strengthening trust among domestic and foreign investors. He made the statement in reply to reporters’ questions about the fact that a wave of foreign investment is moving from China to elsewhere, with Vietnam being one of the most promising destinations. Apart from effective counter-measures, he said, the Vietnamese Government has consistently followed a policy of boosting socio-economic development to improve economic resilience. Vietnam is maintaining supply chains, promoting domestic trade and services and those between Vietnam and other countries, continuing to improve its business climate by slashing corporate costs and administrative procedures, and developing infrastructure and logistics. It is also actively realising free trade agreements with partners and addressing difficulties faced by investors, including creating the conditions necessary for experts and highly-skilled workers to work in Vietnam while ensuring safe and effective pandemic prevention and control, he said./. Agreements give new boost to Vietnam-EU partnership: Vice Foreign Affairs Spokesman The EU-Vietnam Free Trade Agreement (EVFTA) and the EU-Vietnam Investment Protection Agreement (EVIPA) are expected to create new momentum for the comprehensive cooperative partnership between the two sides, Vice Spokesman of the Ministry of Foreign Affairs Doan Khac Viet has said. At the ministry’s regular press conference on May 28, Viet responded to reporters’ questions about the National Assembly (NA) voting on the two agreements at the current ninth session. He noted that following active negotiations and close and effective coordination between Vietnam and the EU, the European Parliament ratified the two agreements on February 12. On March 30, the European Council approved the European Parliament’s ratification, finalising the EU’s internal legal procedures regarding ratification of the EVFTA. The EVIPA, meanwhile, still requires ratification by the parliaments of member nations. Viet said the two agreements are expected to generate considerable, concrete, and practical benefits for the economies, businesses, and people of both Vietnam and the EU, thus creating new momentum for the comprehensive cooperative partnership. The NA is scheduled to consider and vote on the EVFTA and EVIPA at this ninth session, he added./. Vietnam – US comprehensive partnership growing: Foreign Ministry Vice Foreign Ministry Spokesman Doan Khac Viet has said the Vietnam – US comprehensive partnership has been growing in diverse areas over the past years, including in national defence-security. Viet made the statement at the ministry's regular press conference in Hanoi on May 28, in reply to reporters’ queries regarding the US’s upcoming hand-over of a large-scale patrol vessel to Vietnam. Based on agreements reached by both sides, including the 2011 Memorandum of Understanding for Advancing Bilateral Defence Cooperation, the 2015 Joint Vision Statement on Defence Relations and the Plan of Action for Defence Cooperation for 2018 – 2020, the two countries are promoting bilateral defence ties, including in maritime security and improvement of legal enforcement capacity at sea, contributing to maintaining peace, stability, cooperation and development in the region and the world, he said./. VNN |
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Travel firms resume operation, design tours for young clients 01:39 Specializing in outbound tours for young clients, IGo is now considering launching domestic tours after two months of ‘hibernation’ because of Covid-19. Tran Vu Ai, the founder of IGo, believes that providing domestic tours to young clients is the only way for travel firms since it is still unclear when international air routes will be restored.  The Golden Bridge in Da Nang IGo’s business has been frozen since early March with only a few domestic tours still provided. Its revenue has dropped by 95 percent. “I think international air routes will only return to normal after a long time. Businesses need to have backup plans,” Ai said. “We are working with partners on expanding the domestic travel market segment which targets young people,” he said. Some analysts believe this is a reasonable business strategy for now because it can asatisfy the demand of young people who want to travel abroad but cannot afford expensive tours.
Nguyen Nguyet Van Khanh from Vietravel also said the firm would restart its operation with domestic tours, including tours for families and free & easy tours (combo service of air ticket and hotel room), targeting young people who want self-guided travel. “We hope that after a social distancing period, people will want to spend time relaxing, resting and regenerating positive energy,” Khanh said. Vietravel offers 25-50 percent discounts for tours to attract travelers. The fee for the combo service of coach and 3-day and 2-night resort service at 5-star hotels and resorts in Da Lat, for example, is just VND890,000 a night. The travel firms have also introduced tours to ‘avoid summer heat’ with a 50 percent price discount and have upgraded their service system. Meanwhile, the owner of Oyo hotel chain said hotel managers will be given more power to increase travelers’ local experience and improve the quality of domestic tourism. The hotel chain has designed new accommodation spaces for young clients who favor self-guided travel. According to Khanh, three tourism trends will arise after Covid-19 – travel within a short distance (less than 300 kilometers), travel with family, and private travel. Safety will be a top priority. Therefore, tourism products to be designed by Vietravel to fit the trends. CEO of Oyo Vietnam Dushyant Dwibedy thinks that after the epidemic, self-planned tourism will be favored in comparison with large tours or cruise tours. VNN/Chi Mai |
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BUSINESS NEWS HEADLINES JUNE 101:46May CPI shows slight reduction due to dropping petrol, power, rice prices The consumer price index (CPI) in May decreased by 0.03 percent against the previous month and 1.24 percent against last December, but increased by 4.39 percent year-on-year, the General Statistics Office (GSO) reported on May 29. The average index for the first five months was up 4.39 percent from that of the same period last year. In the period, basic inflation rose by 2.88 percent year-on-year. According to the GSO, in May, four out of the 11 commodity groups experienced price reductions: transport (2.21 percent); culture, entertainment and tourism (0.02 percent); post and telecommunication services (0.02 percent); and garment, headwear and footwear (0.01 percent). Increases were seen in prices of restaurant and catering service (0.34 percent); beverage and tobacco (0.25 percent); housing and building material (0.25 percent); other commodities and services (0.07 percent); household appliances (0.05 percent); and medicine and medical services (0.04 percent). Meanwhile, prices in the education group remained unchanged. In the month, CPI in urban areas was down 0.17 percent, while that in rural areas was up 0.11 percent. Do Thi Ngoc, head of the GSO’s Price Statistics Department, attributed the falling CPI to decreases in prices of petrol, electricity, rice, and housing rent. In May, gold prices moved up in tandem with global gold prices, surging 2.41 percent from April to hover around 4.71 million VND (203.7 USD) per tael. The VND/USD exchange rate reduced 0.41 percent, with one USD exchanged for 23,219 VND./. Tinder introduces new safety feature with photo verification technology in Vietnam Tinder users in Viet Nam will now be able to take selfies for safety with the introduction of ‘Photo Verification’. This new feature uses cutting edge technology that compares a posed photo taken in real-time to the images that appear on a member’s profile. It is designed to enhance the safety of members by ensuring authenticity and increasing trust in member profiles. "Every day, millions of our members trust us to introduce them to new people, and we’re dedicated to building innovative safety features powered by best-in-class technology that meet the needs of today’s daters," said Elie Seidman, CEO of Tinder. "I’m proud to share this update, which represents an important step in driving our safety work forward." Photo verification on Tinder ensures that every match is who they say they are. The feature allows members to self-authenticate through a series of real-time posed selfies, which are compared to existing profile photos using human-assisted AI technology. Verified profiles will display a blue checkmark so members can trust their authenticity. Tinder was introduced on a college campus in 2012 and is the world’s most popular app for meeting new people. It has been downloaded more than 340 million times and is available in 190 countries and more than 40 languages. As of Q1 2020, Tinder had over 6 million subscribers and was the highest grossing non-gaming app globally. Vietnam’s canned tuna exports to key markets rise Vietnam has seen an increasing export of canned tuna to a number of key market though adverse effects of the COVID-19 pandemic, according to Vietnam Association of Seafood Exporters and Producers (VASEP). Data from the General Department of Vietnam Customs showed that in the first four months of 2020, the export of Vietnam’s canned tuna to the US rose 2 percent year-on-year. The increasing demand for canned tuna in the European Union (EU) pushed Vietnam’s shipments to this market up 2.7 percent compared to the same period last year. In April, the country’s tuna export to ASEAN recorded a rise of 4 percent year-on-year. In particular, a surge of 61 percent was seen in Thailand - the largest importer of Vietnamese tuna in the group. The tuna shipments to Egypt and Japan expanded 59 percent and 36 percent, respectively. VASEP said that Japan is increasing import of other processed tuna products from Vietnam, especially frozen tuna, which saw a year-on-year soaring growth of 111 percent./. ADB helps Indonesia develop geothermal power The Asian Development Bank (ADB) has approved a loan worth 300 million USD to help PT Geo Dipa Energi (GDE), an Indonesian state-owned company, expand its geothermal power generation. In its May 28 announcement, ADB said that it will also manage a 35 million USD loan from the Clean Technology Fund for the project. GDE will use these loans to investing in expanding its geothermal power generation capacity by 110 megawatts in Java, the country’s largest electricity grid, through the construction and commission of two geothermal plants at Dieng in Central Java and Patuha in West Java. GDE President Director Riki Ibrahim said that the Geothermal Power Generation Project, recognized as a National Strategic Project by the government, will provide environmentally friendly base-load electricity to the Java–Bali electricity grid, reducing CO2 emissions by more than 700,000 tonnes per year. The project will build critical geothermal experience in Indonesia and contribute to the government’s efforts to attract private-sector investment in the sector by reducing early-stage project development risk. The project, approved amid the COVID-19 pandemic, will help ensure that Indonesia’s economic recovery will be green, sustainable, and resilient, he added. “ADB’s geothermal project will help Indonesia combat climate change and make its electricity system more sustainable, reliable, and efficient. It will also help businesses and consumers access affordable, reliable, and modern energy,” said ADB Country Director for Indonesia Winfried F. Wicklein. Indonesia has the world’s largest geothermal potential, with an estimated 29 gigawatts (GW), and the world’s second-largest installed geothermal capacity of 2.1 GW./. Indonesia: Banking industry posts strong Q1 Bank Central Asia (BCA), Indonesia’s largest lender by market capitalisation, reported 6.58 trillion rupiah (444 million USD) in net income in the first quarter of this year, up 8.5 percent against the first quarter of 2019, when it reported net income of 6.06 trillion rupiah. The consolidated net profit of Indonesia’s private banks grew 8.61 percent to 6.1 trillion rupiah during the first quarter. Local lenders’ assets stood at 953.7 trillion rupiah in the banking sector only at the end of the quarter and 972.93 trillion rupiah in all fields. Private and joint venture banks reported 1.6 percent in credit growth, while the loan portfolio of private lenders grew 1.8 percent to 597.73 trillion rupiah./. Coffee farms see high yields from new plants Coffee farms in the Tay Nguyen (Central Highlands) province of Kon Tum are producing higher yields from new coffee trees and older trees grafter with with young shoots. Coffee is a key crop in Kon Tum and other provinces in Tay Nguyen region, the country's largest coffee producer. Kon Tum has been replacing old coffee trees since 2014 and has employed advanced techniques. It has also helped farmers buy coffee seedlings, fertiliser and pesticide. Nguyen Thanh Chung, who has a 0.5ha coffee orchard in Dak Ha district’s Dak Ha township, replanted his 30 year – old coffee trees in 2016. His new trees have a yield of about 20 tonnes of fresh beans per hectare compared to a yield of 11 tonnes of the old coffee trees. “The replanting has offered better efficiency,” he said. The province has replanted more than 1,208ha of old coffee since 2014, according to its Department of Agriculture and Rural Development. The province has 2,180ha of old coffee trees, including 1,430ha of robusta coffee and 750ha of arabica coffee, which need to be replaced to improve yield. Farmers have replanted old coffee trees with new coffee varieties with high yields, good quality, and disease resistance. The TR4 variety, for instance, is harvested in the dry season, providing easy conditions for farmers to process. The province’s coffee areas increased from 16,600ha in 2016 to 21,470ha last year, according to the department. However, irrigation projects provide water for only one part, leaving many coffee areas facing the threat of drought in the dry season. Many farmers in recent years have been using drip or spray irrigation systems to save water. Under the Vietnam Sustainable Agriculture Transformation Project in Kon Tum (VnSAT Kon Tum), many farmers have been provided 50 percent of the investment costs to buy efficient irrigation systems. Nguyen Xuan Hai, one of the farmers in Dak Ha district’s Ha Mon commune benefiting from VnSAT Kon Tum, bought a spray irrigation system which uses Israeli irrigation technology. The system, which cost 90 million VND (3,900 USD), can both irrigate and fertilise coffee trees at the same time as the fertiliser is mixed with the water. Previously, he spent about eight hours irrigating coffee trees each time, but now spends only 40 minutes. Kon Tum is facing drought, but his coffee orchard has developed well because it has sufficient irrigation water. “The use of the system has improved the quality of coffee as irrigation water and fertiliser are sprayed equally on the coffee trees,” he said. The Israeli irrigation technology helps farmers save water and reduces fertiliser and labour costs, according to the VnSAT Kon Tum’s Management Board. Farmers save 30 – 40 percent of irrigation water compared to traditional irrigation methods, while coffee yield is improved by 15 – 20 percent./. COVID-19 delays co-operation of local pharmaceutical firms with foreign partners Whilst the novel coronavirus (COVID-19) epidemic has greatly impacted several major industries, the output of domestic pharmaceutical enterprises remains strong with many drugstores announcing revenue growth of between 164% and 168% during the first quarter and the opening four months of the year. Despite this growth, a number of investment projects have been negatively affected, with the progress of co-operation between domestic pharmaceutical companies and their foreign counterparts being delayed by the COVID-19 epidemic. This delay in co-operation activities has hindered the progress of things such as the appraisal of good medicine production standards (GMP) and the approval of the process of technology transfer from European and Korean partners. Information regarding the delay was released in the Pharmaceutical Report of FPTS Company as they outlined progress during the first four months of the year. Most notably, according to Imexpharm Pharmaceutical Joint Stock Company, the COVID-19 has slowed down plans relating to the Non-beta-lactam Binh Duong High-tech Factory (IMP4). Construction has been completed on the IMP4 factory and it has already gone on to meet WHO-GMP standards, but the EU-GMP approval process is expected to be completed ahead in the second quarter of the year having fallen a quarter behind schedule due to the travel of experts and partners from Europe to the nation being delayed by the virus. As a consequence, plans to go on to produce 20 non-beta-lactam products to put the two-channel ETC channel, hospital system and pharmacy, out to tenders at the IMP4 factory has been delayed from its original date of the beginning of the third quarter to the beginning of the fourth quarter this year. Elsewhere, Traphaco Joint Stock Company (TRA) have been hit by a similar issues due to the COVID-19 slowing down the technology transfer of products from Daewoong Pharmaceutical to TRA as a result of the limited travel of experts from the Republic of Korea (RoK) to the country. Therefore, the distribution of seven new products based on Daewoong Pharmaceutical's technology has been pushed back by TRA to early 2021. During the remainder of the year, TRA plans to earn VND2,000 billion, a rise of 16.5%, in revenue and after tax profit of VND180 billion, an annual increase of 5.5%. Simultaneously, TRA will continue to develop distribution products and increase its products by negotiating and signing contracts with foreign partners, including Daewoong Pharmaceutical Group of the RoK. In the year ahead, the firm will receive between 10 and 15 new products from Daewoong Pharmaceutical. Trade war, COVID-19 make Vietnam even more attractive to foreign investors: HSBC Emerging economies are chasing companies to get more FDI, but companies are chasing Vietnam to move there, said HSBC. External risks such as the US – China trade war and, most recently, the COVID-19 pandemic, in fact made Vietnam an even more attractive proposition relative to many other markets, according to HSBC. In its latest report on Vietnam, HSBC said that the headwinds have become tailwinds, strengthening its longstanding view that trade tensions were not the trigger for the movement of supply chains to Vietnam, they merely accelerated the process. In its latest report, HSBC said the concept of antifragility – introduced by academic, investor and author, Nassim Nicholas Taleb, – fits Vietnam to a tee. The country’s antifragility qualities – those that go beyond resilience or robustness and lead to improvement – are showcase as: Firstly, Vietnam has handled COVID-19 better than most, recording no deaths and a relatively low number of infections, allowing Vietnam to re-open much earlier than other countries. Unless there is a second wave the economy has probably passed the trough. Secondly, a number of economic indicators have held up rather well. Google data suggests that average non-residential mobility is now only 11% below its baseline levels, the best pace of recovery among ASEAN markets. Industrial production and exports have grown this year despite COVID-19, the decline in retail sales has been limited to less than 5%, and the equity market has bounced back quickly. Thirdly, Vietnam is the only economy in the region where HSBC forecasts positive economic growth for 2020. Murat Ulgen, HSBC’s Global Head of Emerging Markets Research, argues that it is the least vulnerable to macro shocks, based on his HSBC Emerging Market (EM) vulnerability index. Fourthly, EM countries are chasing companies to get more FDI, but companies are chasing Vietnam to move there. The country’s share of world exports has been rising rapidly and this is not just because of US-China trade tensions. Its role in Asian supply chains has been increasing for years and is set to expand further. While other markets are grappling with COVID-19, Vietnam has got back on its feet quickly and is poised to emerge stronger as companies re-evaluate and diversify their supply chains. Companies were looking to move to Vietnam well before trade tensions became an issue. Vietnam offered lower costs, favorable tax policies, geographic advantages, relatively better infrastructure, and a young and skilled labor force. Trade tensions have accelerated this shift as companies looked to de-risk and diversify their supply chains. The demand is clearly there and is growing. However, the main obstacles are on the supply side, given Vietnam’s relatively small size and limited resources, and a high level of dependence on China for imports. However, HSBC expected that the country has enough resources for the next 3-5 years in terms of land, labor, and electricity. This should become increasingly important now that COVID-19 has highlighted the importance of shifting production out of China as companies move to diversify their supply chains and reduce their dependence on a single country for production and raw materials. Therefore, FDI into Vietnam should accelerate post COVID-19. Industrial real estate continued to see demand in the first quarter. A Jones Lang LaSalle (JLL) report suggested that land prices rose 12% year-on-year during the period. On average, manufacturing an item in Vietnam costs 73.9% of what it would in Japan. Across the region, only the Philippines, Cambodia, Sri Lanka, and Bangladesh have lower manufacturing costs. But these markets usually make less sophisticated products and don’t have the same level of manufacturing capabilities as Vietnam. Fifthly, there have been concerns about productivity, especially given the increase in land prices and wages. But HSBC expected that Vietnam continues to provide an attractive balance between cost and productivity. Due to strong demand from firms and this attractive trade-off between costs and productivity, Vietnam is moving up the value chain. In addition to its huge production presence, Samsung has also opened an R&D center. The Apple eco-system is also moving to Vietnam through the assembly of AirPods. Several districts within Ho Chi Minh City have been combined to develop a “Vietnamese Silicon Valley” – a combination of hi-tech park, university precinct, and new financial center. Sixthly, elsewhere in the region corporate balance sheets have taken on more leverage and interest coverage ratios have fallen. In Vietnam, leverage is declining and interest coverage ratios are on the rise. Seventhly, over the past five years, the currency has depreciated the least among regional markets. Vietnam, which is a sub-investment grade bond market, has sovereign yields that are much lower than investment-grade markets such as Indonesia and India. The equity market has outperformed too. India initiates anti-dumping investigation into Vietnamese polyester India has recently announced the launch of an anti-dumping probe into the import of Vietnamese polyester yarn products, according a statement issued by the Trade Remedies Authority of Vietnam. The investigation is based on petitions filed by eight Indian yarn companies that had called for a probe into the import of polyester yarn products from Vietnam, China, Indonesia, and Nepal. The Directorate General of Trade Remedies (DGTR) of India is set to conduct investigations into dumped polyester yarn products that entered the South Asian nation between January 1, 2019 and December 31, 2019. Moreover, the period between April 2016, and December 2019 will be investigated and assessed with all damage being considered, while the DGTR will send a questionnaire to production and export firms for them to complete. Other businesses will be required to be proactive when contacting the DGTR as they must receive the questionnaire and submit it within 30 days of May 21, the date when firms first received the notice. Enterprises may therefore submit a request in order to extend the time limit for submission of the questionnaire to the DGTR for review. Moreover, businesses have been asked to regularly exchange information with India’s import partners as a means of raising any concerns with the Indian Government, while also asking the DGTR to seriously consider the socio-economic benefits and long-term interests of consumers. As a result, firms should seek to co-ordinate closely with the Trade Remedies Authority of Vietnam in order to receive updated information and therefore prompt support. Enterprises have also been requested to effectively work alongside the Trade Remedies Authority of Vietnam to avoid the imposition of anti-dumping duties by the DGTG. Vietnam strives to effectively attract private investment Vietnam has been advised to introduce a range of solutions aimed at attracting private investment in an effective manner with the private economic sector increasingly becoming a key part of the national economy, therefore undertaking a large number of key development projects. Comprised of over 700,000 businesses of various sizes, the private economic sector last year ultimately made up approximately 42% of the country’s gross domestic product and employed up to 80% of the national labour force. Indeed, many private investors such as Sungroup, Vingroup, and BRG have been able to develop well-known brands in a market that is largely associated with large projects through utilising modern technology in both production and business. According to Nguyen Dinh Cung, former Director of the Central Institute for Economic Management, facilitating the private economic sector’s development remains an inevitable trend for the national economy. The number of newly established enterprises has been steadily annually, while the sector in general has been able to successfully mobilise huge amounts of capital for production and business, developing into an important part of the national economy in the process. Championing this point of view, Alwaleed Fareed Alatanani, an economist at the World Bank in Vietnam, believes that about US$60 billion of idle money is being kept by local citizens, which could represent a great source of investment for the economy if it is utilised in an effective manner. Most notably, the increasingly improved investment and business environment can be considered to be an effective support platform for enterprises to organise production, boost business, and attract investment from the private economic sector. At present, relevant authorities have reduced and simplified more than 3,807 out of 6,191 business conditions, along with removing some 7,000 lines of goods subject to inspection, thereby saving VND6,300 billion for firms. In addition, the median score of the newly released Provincial Competitiveness Index reached 63, a 15-year record high, indicating the outstanding efforts put in by localities as they seek administrative reform. With the country effectively bringing the novel coronavirus epidemic under control it is now striving to reboot the economy to reflect moving into a ‘new normal’. Therefore, attracting private investment can be considered one of the key solutions for promoting economic growth. Representing the business community, Vu Tien Loc, President of the Vietnam Chamber of Commerce and Industry, believes the reform of administrative procedures and investment environment should be an absolute requirement for each locality as they try to attract private capital. In line with this, the Government has asked ministries to cut down at least 20% of the number of documents under their authority between 2020 and 2025. In addition, the Government plans to disburse VND700 trillion worth of public investment capital over the course of the year which will be considered to be a ‘strong push’ to attract capital from the private sector. Pham Dinh Thuy, Director of the Department of Industrial Statistics under the General Statistics Office, notes that promoting public investment will ultimately create positive conditions for private enterprises to provide plenty of services, as well as work, in their role as contractors and investors. The current ongoing session of the National Assembly is debating a bill on Public-Private Partnership. If it is granted approval, economic expert Nguyen Duc Kien says that the bill will pave the way for private businesses to engage in a range of large projects, therefore becoming the driving force behind national economic development. The Asian Development Bank has also forecast that the country’s infrastructure investment demand will stand at roughly US$480 billion in the 2017 to 2030 period. With an array of investment opportunities lying ahead, creating a safe business environment along with a transparent and fair legal corridor appears to be the key factor in attracting private investment. Localities adopt measures to promote tourism after COVID-19 The Hoi An city authorities in Quang Nam province have decided to offer free admission to several local tourist sites for doctors, nurses and medical workers who have been working in the frontline at healthcare facilities in the fight against COVID-19. The promotion, which will run from June 1 until the end of the year, is to be applied in Hoi An old town, Cham islet, Bay Mau coconut forest, and Tra Que vegetable growing village. All Vietnamese visitors to the old town, Cham islet and Bay Mau forest can also enjoy a “buy one get one free” promotion from June 1 to September 30, 2020. A tourism stimulus programme was launched in Dong Thap province on May 27 in response to the Ministry of Culture, Sports and Tourism’s campaign on ‘Vietnamese people travel Vietnam’. Taking place throughout the second half of this year, the programme will provide visitors with 10%-30% discount at local tourist sites, restaurants and hotels. A wide range of cultural, tourism and sporting events will also be held under the programme to attract vacationers to the locality. In a similar effort to revitalise the tourism sector, the Hanoi municipal People’s Committee has directed the city’s Tourism Department to step up promotional campaigns to advertise Hanoi as a safe destination for travellers after the COVID-19 epidemic. The department was also asked to build a general set of criteria for high-quality tourist sites, improve tourist services, and strengthen cooperation with neighbouring localities to boost regional tourism. Meanwhile, Hai Phong city People’s Committee recently adopted a project on developing tourism in its rural areas for the 2021-2025 period, which focuses on unlocking the tourism potential in Tien Lang, Vinh Bao, An Lao, Thuy Nguyen, Kien Thuy and An Duong districts. The above-mentioned districts are also being encouraged to step up the building of new style rural areas while developing community-based tourism. VinFast test drives new electric car Vietnamese carmaker VinFast's new electric crossover model underwent a test drive in a Vingroup residential area in Hanoi yesterday, May 28, with a camouflage cover and “VinFast Nextgen-Test Vehicle” displayed on its body, reported the VnExpress news site. A VinFast representative stated that the new electric model was being tested to prepare for its debut by the end of the year. The new automobile was designed by Italian car designer Pininfarina, similar to the two previous VinFast-branded cars, Lux A and SA. VinFast is set to launch its new electric model at the Los Angeles Auto Show in the United States in November. In January next year, the local car manufacturer will test drive the vehicle in many foreign markets before starting mass production in July 2021. The manufacturer of the car’s electric motor is unknown. With a 470 horsepower engine, the car is expected to travel some 500 kilometers in ideal conditions on a single charge. It can be recharged at home or at charging stations. Aside from the electric model, VinFast has another model that runs on petrol and uses a BMW motor. FDI capital disbursement bounces back The disbursement of capital for foreign direct investment (FDI) projects has returned to an upward trend this month, with a total of US$1.55 billion, according to the Ministry of Planning and Investment. This figure is US$250 million higher than in April. It has also inched up by US$150 million and US$700 million against the figures recorded in March and February, respectively. The decline of FDI disbursement in the previous months was attributed to the coronavirus pandemic and Vietnam’s social distancing measures to curb the spread of the disease. The FDI disbursement rise in May indicated that foreign investors are confident in Vietnam’s efforts to contain Covid-19 and have thus taken steps to accelerate capital disbursement to roll out new or suspending projects. The capital disbursed to FDI projects this month has surpassed the total amount of freshly pledged capital and additional funding for existing projects, at some US$1 billion. Even if US$512 million in funding from capital contributions and stake purchases conducted by foreign investors is included, the new figure is still not higher than the capital disbursement in May. In the year to May, foreign investors poured some US$6.7 billion into projects nationwide, dropping around US$600 million over the same period last year. According to the ministry’s Foreign Investment Agency, roughly 31,900 FDI projects remain active to date, with total registered capital exceeding US$373 billion. Given the difficulties in investment promotion activities, Phan Huu Thang, former head of the Foreign Investment Agency, noted that favorable conditions should be created for foreign investors of licensed yet incomplete projects so they will spend more money to continue the execution of the projects. Vietnam Airlines swiftly restores domestic flight network National flag carrier Vietnam Airlines has officially restored the domestic flight network with 300 flights departing on May 29, marking an impressive increase of 36% since the initial novel coronavirus (COVID-19) outbreak, according to a representative of Vietnam Airlines. The representative went on to state this rise represents a positive signal, marking the strong rebound of Vietnam Airlines and the domestic aviation industry. Immediately after the COVID-19 epidemic was successfully brought under control in Vietnam, the number of domestic passengers rapidly increased with the airline transporting over 500,000 domestic flights since the conclusion of social distancing measures on April 23. In terms of international routes, relevant ministries and agencies have submitted a proposal to the Government to decide on an appropriate time to gradually ease immigration measures and resume some routes, although this is entirely dependent on the actual epidemic situation in each country respectively. This boost comes after Vietnam Airlines launched five additional domestic routes to famous tourist destinations in mid-May to meet the increasing travel demand of passengers. The move also contributed to stimulating tourism demand ahead of the peak travel season this summer, in addition to being a response to the "Vietnamese people travel in Vietnam" campaign launched by the Ministry of Culture, Sports and Tourism. In June, the airline plans to put six additional domestic routes into operation in an effort to develop and expand the domestic flight network. The airline has therefore greatly strengthened COVID-19 preventive measures by thoroughly spraying disinfectant throughout the entire fleet, monitoring the health of passengers at the airport, as well as asking flight crews and passengers to wear face masks during their flight. International tourists down nearly 50% The General Statistics Office (GSO) announced on May 29 that 72.9 % of foreign tourists in the period were from Asia, with numbers from the region down 51.4 % year-on-year. Falls were seen in almost all major markets, such as China (down 57.2 %), Malaysia (53.9 %), the Republic of Korea (53.4 %), Japan (48.2 %), France (47.5 %), the UK (44.3 %), and Russia (23.2 %). Conversely, the number of Cambodian tourists surged 118.3 %. Revenue from tourism services in the period was estimated at 8.3 trillion VND (359 million USD), down 54.1 %. Localities seeing significant declines in revenue include the southern province of Ba Ria-Vung Tau (72.9 %), south-central Khanh Hoa province (68.2 %), HCM City (66.1 %), and northern Quang Ninh province (65.4 %). Vietnam has suspended granting visas to foreigners amid the COVID-19 pandemic. Most foreign visitors currently in the country are experts and technicians. The Ministry of Culture, Sports and Tourism launched the “Vietnamese people travel in Vietnam” programme in early May to stimulate domestic tourism. Five-month period sees FDI total hit US$13.9 billion The overall figure for foreign direct investment (FDI) in Vietnam for the year so far reached US$13.9 billion as of May 20, an annual decline of 17%, according to the latest figures released by the General Statistics Office. In total, the country granted investment licenses to 1,212 new projects capitalized at US$7.4 billion, a fall of 11.1% in terms of the number of projects, but a rise of 15.2% in capital. In addition, 436 existing projects registered to adjust their capital with an injection of US$3.5 billion, an increase of 31.4%. Moreover, the value of capital contributions and shares purchased by foreign investors reached approximately US$3 billion, representing a steep fall of 60.9%. Elsewhere, FDI disbursement throughout the reviewed period stood at an estimated US$6.7 billion, an annual decline of 8.2%. Most notably, the processing and manufacturing industry came first, attracting US$4.9 billion worth of new investment, making up 73.6% of the total, followed by sectors such as real estate, electricity distribution, gas, steam, and air conditioning. Globally, Singapore topped the list of 58 countries and territories currently investing in Vietnam with US$4.3 billion, followed by Taiwan (China) with a figure of US$743.2 million, and China with US$694.9 million. Elsewhere, the country’s total investment capital abroad throughout the reviewed period reached US$180.7 million, equivalent to 98.7% of the figure from last year’s corresponding period. Five-month agro-forestry-fishery trade surplus nearly 3.3bn USD The agro-forestry-fishery sector recorded a trade surplus of close to 3.3 billion USD in the first five months of 2020, a decline of a mere 2.3% year-on-year. According to the Ministry of Agriculture and Rural Development (MARD), shipments overseas during the period brought in nearly 15.5 billion USD, down 4.1 % year-on-year. Exports of key farm produce, husbandry products, fisheries, and forestry products earned approximately 7.4 billion USD, 210 million USD, 2.6 billion USD, and 4.2 billion USD, respectively. All were down year-on-year, by between 1.5 and 19 %. Most products saw lower export revenue compared to last year, with earnings for tra fish, rubber, fruit, shrimp, peppercorn, and tea falling sharply. By contrast, shipments of coffee, rice, vegetables, cinnamon, and bamboo and rattan posted higher value. China remained Vietnam’s largest export market in the January-May period, with 3.7 billion USD. Despite showing a decline of 15.5 % year-on-year, the figure accounted for 23.8 % of Vietnam’s total export value. Following was the US, with around 3.4 billion USD, the EU with some 1.6 billion USD, ASEAN with nearly 1.6 billion USD, and Japan with approximately 1.4 billion USD. MARD forecast that farm produce exports will improve in the time to come but still face a range of difficulties. It therefore plans to work closely with the Ministry of Industry and Trade to monitor domestic prices, ensure a supply-demand balance and food security, and sustain exports. It will also provide regular updates on markets hit by COVID-19, while focusing on clearing technical barriers and expanding trade with the EU, the Eurasian Economic Union (EAEU), the US, and Brazil, among others. Preparations are in place to welcome EU and US inspectors to check on Vietnam’s fight against illegal, unreported and unregulated (IUU) fishing and Vietnamese tra fish safety, respectively. Meanwhile, the import value of agro-forestry-fishery products in the first five months stood at 12.2 billion USD, a decline of 4.5 % year-on-year. Apart from vegetable oil, wheat, and husbandry products, all imported goods, particularly fertilizer, pesticides, animal feed, and corn, posted lower value in the period. Vietnam hailed for good economy, stable politics: Japanese business executive Vietnam is a potential and emerging market, with low risks, good economy and stable politics, Eto Shinji, General Manager of Japanese building product distributor JUTEC Corporation’s Overseas Business Department, has said. “That's why we decided to go there. That was in 2015,” he noted in an interview granted to the Vietnam News Agency’s correspondent in Tokyo recently. According to him, at first, his company tried to sell Japanese building materials in the Vietnamese market. But unfortunately, the way of building houses in Vietnam is totally different from Japan’s one, and thus, building materials used in Vietnam are totally different from those used in Japan. “We had tried to sell our products to those who have special technical knowledge of Japan, but it was not easy. As a result, we changed our mindset to adapt to the market and then, decided to enter its real estate market because we thought that there is a close link between the two markets,” he said. Despite that fact, Eto Shinji went on to say that his company will return to Vietnam’s building material market in the future because the rich in your country is getting bigger and Vietnamese people prefer Japanese products and companies. “We understand that the chance for that business is coming soon, maybe in five years or 10 years. We strongly believe so,” he said. Regarding JUTEC Corporation’s establishment of a joint venture with ISN Real Estate Management JSC. (ISN REM), an affiliate of the ISN Corporation, Eto Shinji said his company chose this partner since ISN REM is the only company that is targeting to Japanese people living in Vietnam, and it has a great network of for-rent condominium owners. Additionally, its manager, who was educated in Japan, has deep knowledge of Japanese people’s taste. Eto Shinji revealed that on May 25, JUTEC Corporation got an investment certificate from the Hanoi Department of Planning and Investment to set up the joint venture. Its registered capital is 20 billion VND, of which the Japanese company owns 50 percent. Its main business is to lease houses and offer Japan-standardized condominium management and operation services to foreign customers, especially Japanese nationals who are currently living and working in Vietnam. “Thus, we want to cooperate with Vietnamese tenants who want to rent their apartments or condominiums to Japanese nationals living in the country, he said. The other business is to distribute Japanese building materials in the market, he said,a dding that the firm now has one showroom in Ho Chi Minh City. “For this, we want to provide Japanese-style building materials solutions for homebuilders in Vietnam so that to increase their houses’ value,” he noted. Domestic market fully tapped to rescue businesses As exports are facing difficulties due to the COVID-19 pandemic, the domestic market of nearly 100 million people is seen as huge potential to rescue local businesses. Vietnam has contained the COVID-19 epidemic and is rebooting its economy. Economists say it is an opportunity for Vietnamese businesses to promote production and trade. The garment and textile industry is among the hardest hit sectors from COVID-19. Its export value declined 20% in April compared to the previous month, prompting its four-month export value to fall 6.6% to about US$10 billion. To address the situation, many businesses have focused more on the domestic market. “We notice a good sign that customers prefer our products, especislly newly introduced office fashion lines," said Bui Duc Thang, Marketing Chief of the Garments 10 Company. "Revenue has gradually increased and our business has fairly returned to normal.” To reboot production and trade, garment makers have redefined their product lines and markets and set up links among manufacturers and distributors. They have upgraded and expanded production infrastructure and service facilities to meet consumer needs. “During the pandemic, we refurbished our convenient stores and food shops in the inner city to better serve customers. We’ll continue to repair our stores and build 100 more from now to the end of this year,” Nguyen Tien Vuong, Deputy General Director of Hanoi Hapro Group, told VOV. The total retail sales of consumer goods and revenue of consumer services in the first 4 months declined 4.3% from last year. But retail sales of consumer goods increased slightly from last year. Bach Kim Ngan, Director of Ngan Giang Company, noted that the domestic market is a firm mainstay for Vietnamese businesses, adding that “Since the Government eased social distancing and businesses resumed normal operation, we have prepared a plan to reintegrate into the market, produce qualified products and work with distribution systems, supermarkets and retail shops to popularize the products nationwide.” “At the same time, promotion programs will be increased to stimulate consumers. We focus on the domestic market because it is very potential,” said Ngan. Chinese traders set to enter Vietnam to deal in lychees Up to 309 traders from China have been granted permission by Prime Minister Nguyen Xuan Phuc to enter and purchase lychees in Luc Ngan district of Bac Giang province, one of the country’s largest lychee growing areas. Bac Giang has submitted a list consisting of 309 Chinese lychee dealers to Luc Ngan district is home to 15,290ha of land under lychee cultivation, with an estimated output of 85,000 tonnes, of which 36,000 tonnes have been reserved for export. the Ministry of Public Security and the Border Guard in Lang Son province, with PM Phuc granting approval to the proposal providing that epidemic prevention measures are taken, according to La Van Nam, head of Luc Ngan district’s administration, during a press briefing on May 30. Nam added that the Chinese side is closely co-ordinating efforts with their Vietnamese counterparts while striving to create favourable conditions in which Chinese traders can enter the country and purchase lychees. The northern neighbour also requires traders to test negative for the novel coronavirus (COVID-19) three days before they enter Vietnam, Upon arrival in the nation, the Chinese traders will be immediately transferred to five hotels and guesthouses around Luc Ngan district where they are to be quarantined in order to undergo medical surveillance in line with regulations. Following the completion of a 14-day quarantine period and testing for the COVID-19, traders who test negative will be granted a virus free certificate and be then permitted to conduct normal transactions alongside local growers. This year, Luc Ngan district is home to 15,290ha of land under lychee cultivation, with an estimated output of 85,000 tonnes, of which 36,000 tonnes have been reserved for export. New wave of EU investment whipped up by coming FTA A new period of EU investment development in Vietnam is right around the corner, as the historic EU-Vietnam Free Trade Agreement (EVFTA) is expected to be adopted by the National Assembly early next month. The EVFTA represents a vote of confidence in Vietnam, as just the second ASEAN nation to sign a free trade agreement with the European Union. It will usher in an era of increased trade and investment and begin the process of phasing out almost 99% of tariff lines and barriers to trade. It will also open up new markets to European investment and innovation, and promote sustainable growth and development in Vietnam. The EVFTA is now more important than ever, as trade wars and a global pandemic disrupt normal business operations on an unprecedented scale. Therefore, the fact that Vietnam will soon have privileged access to an EU consumer market of around 500 million people, while also opening its market to EU enterprises keen to do business and invest in a strong, secure, and prosperous nation at the heart of Asia, is a positive signal for the future. However, it is important to remember that the benefits of the EVFTA should be seen over the coming decades, not the coming days. The moment it enters into force, it will liberalise 65% of EU exports to Vietnam and 71% of Vietnamese exports to Europe. The remaining tariff lines will be gradually phased out over the next decade. For instance some sectors, such as chemicals, will see 70% of their exports to Vietnam become duty free as soon as the EVFTA enters into force, with the remaining being phased out later in the implementation period. Likewise, around half of European pharmaceutical exports will be duty free at entry into force, with the rest liberalised after seven years. Duties on other European products such as beer and smaller motorcycles will not be duty free until much later in the implementation process, after 10 years. Therefore, while the EVFTA will undoubtedly see trade and investment increase, it will take some time for this to bear fruit across the board. The agreement is likely to be implemented this summer if it is ratified in Vietnam’s National Assembly next month. Once it has entered into force, sectors will be further opened up to EU investment and innovation. These sectors include telecommunications, advanced education, computer services, and the environment. Meanwhile, other sectors such as banking and financial services will be opened up later in the transition period, so that after five years EU banks will be able to invest up to 49% in certain joint-stock commercial banks. Since the outbreak of COVID-19, we have not seen a significant shift in terms of EU investment to Vietnam. While Vietnam is an attractive trade and investment destination – and will remain so as other countries struggle to match its swift and effective handling of COVID-19 – European companies have been hit hard by this pandemic. Like elsewhere around the world, the suspension of normal business operations has hit company cash flows. While the future remains unpredictable, at least in the short-term, we remain confident that Vietnam will be high on the agenda for European investors in the years to come as the EVFTA enters into force. German city appreciates Vietnamese firms’ support for COVID-19 fight The Hoa Lam Group of Vietnam and the Germany-based GEDU International company presented the Invest Region Leipzig with 100,000 medical face masks, 10,000 pairs of gloves, and SARS-CoV-2 test kits at Leipzig airport in Saxony state on May 29. The assistance was carried by Vietnam Airlines together with other medical supplies that Germany’s health care service provider Sana Kliniken AG had ordered from Vietnam to serve the COVID-19 fight. On behalf of the Leipzig administration, Administrator for the district of North Saxony Kai Emmanuel appreciated the precious contributions and support by the Vietnamese Government, organisations and businesses, as well as the Vietnamese people in his city, for the authorities and people of Leipzig and Saxony in the combat against COVID-19. He expressed his wish to continue building up long-term partnerships with Vietnamese enterprises and localities on the basis of mutual trust and for common interest. For his part, Vietnamese Ambassador to Germany Nguyen Minh Vu highly valued Vietnamese and Leipzig firms’ effective cooperation, even amid the coronavirus crisis, highlighting the traditional friendship and cooperation between the two sides. The diplomat also took this occasion to thank the Saxony and Leipzig authorities for continually creating the best possible conditions for the Vietnamese community to integrate into the local society and contribute to the city’s development, especially its achievements in containing COVID-19. He noted that over the past years, Leipzig has worked actively to enhance the two countries’ cooperation and friendship. It is the first German city to have opened a representative office in Vietnam. Aside from maintaining the twin relationship with Ho Chi Minh City, it has also forged connections with many other Vietnamese localities like Hanoi, Quang Ninh, Ninh Binh and Long An, focusing on such fields as health care, vocational training, renewable energy, and environment. In the time ahead, the two sides will organise events to promote relations as part of activities to celebrate the 45th founding anniversary of Vietnam-Germany diplomatic ties, according to the ambassador./. VNN |
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BUSINESS NEWS HEADLINES JUNE 2 01:40 New firms up 36 percent in May  A total of 10,728 new firms were established in May with total registered capital of 112.7 trillion VND (4.83 billion USD), up 36.1 percent in number and 20.1 percent in capital from the previous month, according to the General Office of Statistics (GSO). With the May figure, the number of new firms set up in the first five months of the year reached 48,300 with total capital of 557 trillion VND, down 10.5 percent in number and 16.7 percent in capital year-on-year. Taking into account the 817.4 trillion VND added to existing firms, the capital flow into the economy in the period came to 1,375 trillion VND, a decrease of 17 percent compared to the same period last year. Besides, 21,700 firms resumed operation, up 10.5 percent year on year. Meanwhile, 26,000 firms suspended operation for a certain period, up 36.4 percent year on year, and 16,500 suspended pending dissolution procedures, down 14.5 percent. Nearly 6,100 firms dissolved in the five months, down 4.8 percent, with 2,200 of them in whole and retail, automobile and motorbike repair./. Hanoi attracts 1.56 billion USD in FDI in five months Hanoi attracted 1.56 billion USD in FDI in the first five months of this year, it was reported at a video meeting of the municipal People’s Committee on May 29. The city saw the establishment of 12,260 new firms in the period with total registered capital of 181.4 trillion VND (7.78 billion USD), down 10 percent in number but up 9 percent in capital compared to the same period last year. Meanwhile, 1,261 firms dissolved during the period, 7,075 others suspended operation and 3,669 resumed production and business. Hanoi continues to perform fairly in enhancing local competitiveness and administrative reform. It came in at second place in the 2019 Public Administration Reform Index (PAR Index) for the third year in a row with 84.64 percent. The capital city gained 68.8 points in the 2019 Provincial Competitiveness Index, 3.4 points more than previous year, to rank the 9th for the second straight year. Speaking at the meeting, Chairman of the committee Nguyen Duc Chung said local authorities have made concerted efforts to carry out the double task of epidemic prevention and economic development. Hanoi has gone through 43 consecutive days without any new community infection of COVID-19, and all 118 COVID-19 patients in the city have recovered. The city will continue to implement the directive of the municipal People’s Committee’s Chairman on preventing and fighting the pandemic along with the tasks and solutions set by the Government, the Prime Minister in the “new normal” situation./. Vietnamese companies seek business opportunities in Singapore Vietnamese agricultural, fishery and food businesses were updated on the Singaporean market at an online conference held by the Ministry of Industry and Trade’s Vietnam Trade Promotion Agency (Vietrade) and the Vietnamese Trade Office in Singapore on May 29. The event, which saw the participation of over 100 representatives of agencies, organisations and businesses of the two countries, offered Vietnamese firms a good chance to directly interact with Singaporean partners, thus introducing their products. According to head of the Vietrade Vu Ba Phu, Singapore, one of the countries with the most dynamic economy in Asia - Pacific, is playing an important role in trade cooperation with Vietnam. The country considers Vietnam as one of the key markets to help it offset the shortage of goods, especially agricultural products, fisheries, food and construction products. Addressing the event, Chairman of the Singapore Manufacturing Federation and the Vietnam-Singapore Business Council (VSBC) Douglas Foo said Vietnam and Singapore signed a series of free trade agreements (FTAs), and their membership of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) has created great opportunities for the two countries to further expand cooperation. Tran Thu Quynh, Trade Counselor at the Vietnamese Embassy in Singapore said the two countries' trade supports each other rather than compete, adding that this is a favourable condition for Vietnamese exporters of agricultural, fishery and food products to expand their market share in the country. Quynh said in order to adapt to the new situation, Vietnamese businesses need to prepare for changes in the consumption trends in the Singaporean market, and pay attention to building supply networks in order to create capacity to adapt to risks. She stressed the necessity for Vietnamese firms to take advantage of e-commerce channels to do business because e-commerce in Singapore is booming in all areas. Vietnamese and Singaporean businesses should enhance cooperation in capital, technology, brand and consumption network to increase production scale and added value of products, Quynh noted. The Vietnamese Trade Office is willing to assist Vietnamese businesses in exhibiting and introducing their products, she said. It will also support Vietnamese businesses in market research through trial sales on local e-commerce channels such as Redmart, Ezbuy, Eamart, Market Fresh, Quynh added./. Philippines considers 16.7-billion-USD stimulus package The Philippine government is eyeing a stimulus package worth 846 billion pesos (16.7 billion USD) to enable a full economic recovery from the COVID-19 pandemic, according to Finance Secretary Carlos Dominguez. The stimulus package, which is waiting for Congress' approval, would include a cut in corporate income tax and modernisation of the country's fiscal incentive systems, Dominguez said. Local businesses have urged lawmakers to pass these reforms early so that small, medium and large companies can resume their operation and recover from the public health crisis. The Philippine tax authority said the country's total tax revenue in the first four months of 2020 dropped sharply to 527.41 billion pesos (22.6 million USD), or 25.4 percent below last year's collection over the same period. Despite the decreased revenue, Dominguez said the Philippines remains "financially able" to meet the unexpected challenges of the pandemic. The country also has practiced fiscal discipline and exercised prudence in state spending, he added./. Vinamilk products sold at RoK’s online stores Products of Vietnamese milk producer Vinamilk (Vietnam Dairy Products JSC) have made their entry into the market in the Republic of Korea (RoK), said a RoK dairy business. Vina Korea, a company set up by five Korean distribution firms for the sale of Vinamilk products, said on May 29 that it began to sell milk tea, soybean milk and condensed milk-based coffee products in the market through online stores. Vina Korea Chief Financial Officer Yun Yo-wang said that Vinamilk products meet high Eurozone hygiene and food safety standards. The firm’s products are now available on online shopping malls, such as 11Street Co. and eBay Korea LLC. Vinamilk, established in 1976, owns 13 factories in Vietnam and the largest dairy farm network in Asia. It also runs farms and plants in the US, New Zealand, Cambodia and Poland. Last year, its export turnover expanded 14.8 percent as compared with 2018. Since 1997, its products have been shipped to more than 50 countries and territories, with total value surpassing 2.2 billion USD./. Post-pandemic business, investment opportunities shared with UK firms Business and investment opportunities in Vietnam after the COVID-19 pandemic were discussed at a video talk held on May 29 by the Foreign Ministry, the Vietnamese Embassy in the UK and Asia House - a UK centre of expertise on trade, investment and public policy in Asia. The event saw the presence of Deputy Foreign Minister Bui Thanh Son, Asia House Chief Executive Michael Lawrence, and business executives from around 40 UK groups and major enterprises such as HSBC, De La Rue, KPMG, Prudential, and Standard Chartered. The talk is a valuable chance to connect UK businesses and Vietnamese Government agencies, said Son, adding that it helps popularise information about policies and increase cooperation opportunities in the context of the two countries taking drastic measures to control the COVID-19 and recover their economies. He told participants that Vietnam is working on a “dual target” of disease prevention and economic recovery and development, with a hope for a 5-percent economic growth this year. The Government has taken urgent measures to boost production and business, and improve the investment environment, especially Prime Minister Nguyen Xuan Phuc’s decision to set up a special working group on post-COVID-19 investment promotion, he stated. The Government official stressed that Vietnam and the UK can further develop their strategic partnership, particularly in economics and trade, given opportunities brought by Brexit. He also suggested UK investors seize opportunities brought about by Vietnam’s post-COVID-19 economic and trade incentives, the shifting of the supply chain from other countries to Vietnam, and the enforcement of new-generation free trade agreements such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the EU-Vietnam Free Trade Agreement (EVFTA). At the talk, UK businesses showed their interest in the bilateral cooperation, investment opportunities, and Vietnam’s new trade and investment promotion policies./. Vietnam posts 1.9bln USD trade surplus in first five months Vietnam reported a trade surplus of 1.9 billion USD in the first five months of this year amid the ongoing complexity for global markets caused by the COVID-19 pandemic. According to the General Statistics Office (GSO), export turnover reached 99.36 billion USD, down 1.7 percent year-on-year. The domestic sector’s export value was 33.3 billion USD, up 10.4 percent compared to the same period last year, while the FDI sector’s exports, including crude oil, were valued at 66.06 billion USD, down 6.9 percent. Commodities seeing strong growth in export value during the period included machinery, equipment, tools, and spare parts with 25 percent; computers, electronic products, and components with 22.1 percent; rice with 17.2 percent; coffee with 2.9 percent; and cashew nuts with 2.2 percent. Those with declining turnover were telephones and components (8.8 percent), textiles (14.5 percent), footwear (4.6 percent), fruit and vegetables (10.3 percent), rubber (29.6 percent), and pepper (17.9 percent). Import value in the first five months, meanwhile, reached 97.48 billion USD, down 3.8 percent year-on-year, GSO said. The US remained the largest importer of Vietnamese goods in the period, with turnover reaching 24.6 billion USD, up 8.2 percent. It was followed by China with turnover of 16.3 billion USD, up 20.1 percent. Vietnam’s exports to the EU and ASEAN fell 12 percent and 13.4 percent, with turnover of 12.9 billion USD and 9.4 billion USD, respectively. After posting solid growth in the first quarter, Vietnam’s trade picture has been affected by the COVID-19 pandemic since April. Export turnover in April was just 19.7 billion USD, down 18.4 percent against March and 3.5 percent year-on-year./. January-May FDI down 17 percent Vietnam attracted a total of 13.9 billion USD in FDI in the first five months of this year, a fall of 17 percent year-on-year, the General Statistics Office (GSO) announced on May 29. There were 1,212 newly-registered projects with 7.4 billion USD in investment, down 11.1 percent in number but up 15.2 percent in capital, respectively. A total of 3.5 billion USD was added to 436 existing projects, a year-on-year increase of 31.4 percent, while capital contributions and share purchases by foreign investors stood at nearly 3 billion USD, down 60.9 percent. Processing and manufacturing was the most attractive sector among foreign investors, the GSO said, receiving 6.9 billion USD. Among 58 countries and territories registering new projects in Vietnam in the first five months, Singapore was the largest investor, with 4.3 billion USD, accounting for 58 percent of the total. Following was Taiwan (China) with 743 million USD, China with 694 million USD, Hong Kong (China) with 500 million USD, and the Republic of Korea with 441 million USD. As of May 20, 6.7 billion USD of FDI had been disbursed this year, a year-on-year decline of 8.2 percent, of which over 4.9 billion USD went to projects in the processing and manufacturing industry. Vietnamese investors had 60 new projects abroad in the period, with combined capital of 161.9 million USD. They also added 18.8 million USD to eleven existing projects. Local investors had investments in 21 countries and territories during the period, with Germany being the largest recipient, with 92.6 million USD. Following was the US with 21.7 million USD, Myanmar with 21.2 million USD, and Singapore with 18.9 million USD./. HCM City fosters linkages between academia, companies HCM City authorities are helping companies access new technologies by promoting linkages between researchers and businesses, but more collaboration is needed, speakers said on May 28 at a meeting in the city. Trieu Thanh Son, deputy head of the Research Management and Cooperation Department under the HCM City Institute for Development Studies, said the city has been offering assistance to companies in registration of intellectual property rights and fostering linkages between researchers and businesses. “HCM City is now promoting the science and technology market to enable companies to adopt new technologies and increase their labour productivity.” More collaboration between academia and businesses, however, is needed so that research results can be converted into practical technology, he added. Nguyen Anh Ngoc, deputy director of HCM City Investment and Trade Promotion Centre, noted that the Government provided support to businesses and scientists for research, but there were no tools to foster links between scientists and businesses. “There is a big gap between schools and research institutes and enterprises.” The city has fostered linkages between researchers and businesses, but the results have not met expectations, he said. When researchers try to find partners to commercialise their research ideas, they often encounter resistance because of policy-related issues, he added. Another obstacle is that businesses too often focus on short-term commercial goals instead of long-term investment in technology and research. Nguyen Khac Thanh, deputy director of the Department of Science and Technology, said the department has offered numerous programmes and State policies to researchers and businesses. The department helps businesses improve their technologies and products and assists them in working with scientific and technological organisations. The department also offers support to start-ups, fostering incubation and adoption of technologies, and organises exhibitions, scientific and technological transfer conferences, and business networks. The department has established a Scientific and Technology Business Club to facilitate networking and exchange, and technology transfer. Its board of chairmen includes six members from formally recognised scientific and technology businesses. However, enterprises need to be more proactive and innovative, and take part in networking events, he said. Doan Thanh Khe, director of Phat Viet Food Technology Ltd Company, said the company regularly invests in high-quality modern facilities and equipment as well as a trained workforce and scientific research. HCM City has more than 74 recognised science and technology businesses out of around 200 nationwide. Ninety percent of enterprises in HCM City are micro- or small-sized enterprises and lack the financial and human resources for R&D. The city has approved a science and technology market development programme, which targets increasing the value of science and technology products and services by 15 percent annually in the next five years and 20 percent in the case of key technologies./. Vietnam hailed for good economy, stable politics: Japanese business executive Vietnam is a potential and emerging market, with low risks, good economy and stable politics, Eto Shinji, General Manager of Japanese building product distributor JUTEC Corporation’s Overseas Business Department, has said. “That's why we decided to go there. That was in 2015,” he noted in an interview granted to the Vietnam News Agency’s correspondent in Tokyo recently. According to him, at first, his company tried to sell Japanese building materials in the Vietnamese market. But unfortunately, the way of building houses in Vietnam is totally different from Japan’s one, and thus, building materials used in Vietnam are totally different from those used in Japan. “We had tried to sell our products to those who have special technical knowledge of Japan, but it was not easy. As a result, we changed our mindset to adapt to the market and then, decided to enter its real estate market because we thought that there is a close link between the two markets,” he said. Despite that fact, Eto Shinji went on to say that his company will return to Vietnam’s building material market in the future because the rich in your country is getting bigger and Vietnamese people prefer Japanese products and companies. “We understand that the chance for that business is coming soon, maybe in five years or 10 years. We strongly believe so,” he said. Regarding JUTEC Corporation’s establishment of a joint venture with ISN Real Estate Management JSC. (ISN REM), an affiliate of the ISN Corporation, Eto Shinji said his company chose this partner since ISN REM is the only company that is targeting to Japanese people living in Vietnam, and it has a great network of for-rent condominium owners. Additionally, its manager, who was educated in Japan, has deep knowledge of Japanese people’s taste. Eto Shinji revealed that on May 25, JUTEC Corporation got an investment certificate from the Hanoi Department of Planning and Investment to set up the joint venture. Its registered capital is 20 billion VND, of which the Japanese company owns 50 percent. Its main business is to lease houses and offer Japan-standardized condominium management and operation services to foreign customers, especially Japanese nationals who are currently living and working in Vietnam. “Thus, we want to cooperate with Vietnamese tenants who want to rent their apartments or condominiums to Japanese nationals living in the country, he said. The other business is to distribute Japanese building materials in the market, he said,a dding that the firm now has one showroom in Ho Chi Minh City. “For this, we want to provide Japanese-style building materials solutions for homebuilders in Vietnam so that to increase their houses’ value,” he noted./. Ninh Thuan, Khanh Hoa provinces work to promote tourism after COVID-19 The People’s Committee of the south-central province of Ninh Thuan launched its ‘Vietnamese people travel Vietnam’ programme on May 29 with the aim of reviving the local tourism sector after COVID-19. A total of 35 local accommodation establishments, restaurants, tour operators and travel businesses have registered with the programme, pledging to offer discounts ranging from 10% to 30% on the price of their services from May 29 to December 31, 2020. Students and children aged under 12 years will enjoy free entrance to the Research Centre for Cham Culture in Phan Rang – Thap Cham city, and the Du Long film studio in Thuan Bac district. On the occasion, the local authorities inaugurated the province's smart tourism portal, which is designed to advertise the land and people of Ninh Thuan as well as update information on the tourist products and services of local travel businesses to visitors at home and abroad. Also yesterday, Khanh Hoa provincial People’s Committee held a stimulating domestic tourism programme in Hanoi to promote the locality’s tourism potential to Hanoi city dwellers. The event attracted the participation of more than 40 Khanh Hoa-based travel businesses, offering discounts of up to 50% on their services and products. With an estimated population of 8 million and high travel demand, Hanoi is seen as a key potential market for other cities and provinces in terms of their own tourism markets. Bà Rịa – Vũng Tàu Province embraces organic farming More and more farmers in the southern province of Bà Rịa – Vũng Tàu are going organic. They use compost made from manure and earthworm waste and organic pesticides made from ginger, garlic, red chilli, and alcohol. They use traps and other traditional tools to catch pests. Hồ Hoàng Kha, who has a 10ha green skin and pink flesh grapefruit orchard in Phú Mỹ Town’s Sông Xoài Ward, switched to organic farming on 3ha eight months ago. Though the yield on the 3ha has decreased slightly to 75 tonnes a year from 80 tonnes, quality and prices are better, he said. But the fruits fetch VNĐ35,000 (US$1.3) a kilogramme, VNĐ5,000 higher than normal, he said. He now plans to expand the organic farming method to the remaining 7ha, he said. Sông Xoài Ward, one of the province’s largest green skin and pink flesh grapefruit growing areas, is well known for the quality of its fruit. It has established a co-operative with a few members using organic methods. Hồ Văn Kiệt, director of the co-operative, said members are being taught organic methods to enhance the brand name of the Sông Hoài green skin and pink flesh grapefruit. “This will open up export opportunities and secure steady prices and outlets.” The co-operative has more than 130 members and 180ha of orchards out of the commune’s 200ha. In recent years the province’s Plant Cultivation and Protection Sub-department has been teaching farmers organic farming methods. Lương Văn Quang was one of the first farmers in Bà Rịa City’s Long Hương Ward to be trained and he has been growing vegetables on his 4,000sq.m field since 2017. When he first switched to organic farming, he found the vegetables had a longer gestation period and did not look as attractive as those grown using normal methods, he said. But after a period they began to develop rapidly because the soil had recovered its fertility, and costs became 30 per cent cheaper than that of normal farming methods, he said. “Organic vegetables are popular with consumers, and so they fetch high prices and demand is steady.” Under a plan to develop organic farming in 2020 - 25 the province will develop more models for growing rice, pepper, cacao, vegetables, and fruits. This year it plans to implement four of them for farmers to adopt for growing pepper, cacao, vegetables and green skin and pink flesh grapefruit. The Plant Cultivation and Protection Sub-department admitted organic farming is yet to be done on a large area in the province. Trần Văn Cường, director of the province Department of Agriculture and Rural Development, said to expand the area needs time, human resources and funds to train farmers./. PM targets powerful, prosperous status for southern key economic region by 2035 Prime Minister Nguyen Xuan Phuc on May 30 requested the southern key economic region to strive to become a powerful and prosperous region by 2035, ten years ahead of the deadline for the same goal for the whole Vietnam. He made the remarks while chairing a meeting in Ba Ria-Vung Tau province between permanent Government members and officials of the eight localities in this region, which comprises Ho Chi Minh City and the seven provinces of Dong Nai, Binh Duong, Binh Phuoc, Ba Ria-Vung Tau, Tay Ninh, Long An, and Tien Giang. The southern key economic region is the only of its kind in Vietnam that boasts sufficient conditions and advantages for industrial and service development to achieve a fast, efficient and sustainable growth. It is currently the largest FDI magnet of the country, a leading economic driver, and a gateway for Vietnam’s trading with the world. Addressing the event, PM Phuc applauded the eight localities’ attainments in COVID-19 prevention and control, social security ensuring, and economic development, which have joined the entire country’s efforts to defeat the pandemic. He also highly valued their resolve in economic development and persistence with the initial targets set for this year. Regarding the region’s development goal, he emphasised that this is the key among the four key economic regions of Vietnam, describing it as a “diamond octagon” in Southeast Asia as well as Asia given its economic development and healthy living environment. The PM pointed out that the strength and competitiveness of this region outpace the others’, asking the localities to bring into play their solidarity and join hands to innovate and hold responsibility for national development. Responding to proposals submitted at the meeting, PM Phuc assigned relevant agencies to devise special mechanisms for key economic regions, especially the southern one. He told the Ministry of Planning and Investment to consider an aid package from the Government for the localities to invest in urgent infrastructure and transport facilities – a factor of leading importance in local socio-economic development. Meanwhile, the State Bank of Vietnam and the Ministry of Finance need to work on solutions to facilitate credit institutions’ engagement in infrastructure development projects, particularly those under the private-public partnership (PPP). The Ministry of Transport has to establish projects on boosting transport connectivity among industrial parks and economic zones in the region. The eight localities need to prioritise developing digital economy, e-commerce, and the 5G network, which are crucial for high technology development, according to him. At the session, the PM also asked them to implement the Government’s recently-issued Resolution 84/NQ-CP well so as to further tackle production and business difficulties and stimulate consumer demand which is an important driving force for GDP growth. Prior to the meeting, PM Phuc had made a fact-finding tour of Cai Mep-Thi Vai Port in Phu My town, Phuoc An Bridge, the location of the Cai Mep Ha logistics project, and Hyosung Industrial Park in Ba Ria-Vung Tau./. Budget collection in HCM City drops 16 percent Even though the COVID-19 pandemic has been put under control in Vietnam, its negative impacts were still felt in many fields, including budget collection in Ho Chi Minh City. Total budget collection in the city in the first five months of this year stood at 139.37 trillion VND (5.97 billion USD), equivalent to 34.3 percent of the estimate and down 16 percent from the same period last year. Domestic revenues dropped 13.6 percent to 92.3 trillion VND (33.1 percent of the estimate), and revenues from crude oil decreased by 38.9 percent year on year to over 5.95 trillion VND (48.8 percent of estimate). Revenues from import-export activities went down 16.6 percent to 41.1 trillion VND (35.7 percent of estimates). Contributions by the State sector accounted for 9.6 percent of domestic revenues, down 13.5 percent. The non-State sector contributed 23.5 trillion VND to the State budget, down 24.5 percent, and the FDI sector 25.85 trillion VND, down 5.4 percent. Meanwhile, the city’s spending surged by 11.7 percent to 22.6 trillion VND in the period, as the city implemented policies to support businesses and the population overcome the difficulties caused by the pandemic. The city’s tax authority reported that around 255,000 firms or 97.35 percent of the total have benefited from delayed payment of tax and land rent. In addition, 43,000 business households and small traders have also been allowed to postpone tax payment. HCM City: CPI down 0.33 percent in May Ho Chi Minh City’s consumer price index (CPI) in May went down 0.33 percent from the previous month and 1.38 percent compared to December 2019, according to the city’s Statistics Office. However, the May CPI rose 1.4 percent on-year, the office said. Three of the 11 groups of goods and services used to calculate the CPI saw month-on-month price declines. The transport group saw the strongest fall of 2.29 percent, followed by food and catering services with 0.41 percent and housing, electricity, water, fuel and building materials with 0.97 percent. The groups of garment-headgear-footwear and education saw no fluctuations during the period, while all other groups recorded price increases. In the first five months of 2020, the municipal average CPI increased 3.76 percent annually./. Vietnam takes new tax step to stimulate car market The move would help support the development of local supporting industries, particularly the automobile manufacturing and assembling in the 2019 – 2023 period. The Vietnamese government has agreed to remove import tariffs for auto parts and accessories, which are currently cannot be manufactured domestically. Vietnam removes import duties for auto parts not manufactured domestically. The decision, set to take effect from July 10, is part of the government’s Decree No.57 dated May 25, 2020 on amending and supplementing a number of articles of the Decree No.125 on export duty schedule, preferential import duty schedule and lists of commodities and their flat tax rates, compound tariff and “out-of-quota” tariff rate, aiming to increase the localization rate and enhance the competitiveness of Vietnam’s automobile industry. In order to qualify for this new policy, enterprises must provide sales contract of auto parts with local auto manufacturers and/or assemblers, those that are given operation license by the Ministry of Industry and Trade. Moreover, enterprises should have business license related to production of auto parts and accessories, as well as have their own car production facilities in Vietnam. The review period for preferential tariff treatment for enterprises are from January 1 – June 30 or from July 1 – December 31, annually. For parts and accessories that only require basic processing, rather than a thorough process to become final products, would not be entitled to the 0% tariff rate. Local auto manufacturers previously voiced concern over the insufficient support from Decree No.125 for the automobile industry, as it failed to create considerable advantages for domestic cars over imported ones from other ASEAN countries. The auto parts manufacturing sector in Vietnam currently enjoys incentive policies for investments, but such incentives are not remarkably attractive compared to other sectors, leading to low localization rates. Moreover, domestically produced auto parts are also facing fierce competition from imported products in ASEAN, which are having zero import tariff under the effect of the ASEAN Trade in Goods Agreement (ATIGA). Monthly data from the Vietnam Automobile Manufacturers Association (VAMA) revealed car sales in Vietnam are reported at 64,100 units in the first four months this year, down 36% year-on-year. Sales of domestically assembled cars reached 40,574 units during the period, down 33% compared to the same period of last year, while imported completely-built-units (CBUs) totaled 23,526 units, down 40%. Malaysia to lift ATM operating hour restrictions Malaysia will lift restrictions on Automated Teller Machine (ATM) operating hours between 8am and 8pm, implemented during the Movement Control Order (MCO) and Conditional Movement Control Order (CMCO), on June 1. Senior Minister cum Defence Minister Datuk Seri Ismail Sabri Yaakob said on May 31 that ATM operating hours will return to normal on June 1 as per banks' practices. The Malaysian Government had enforced the 8am to 8pm ruling on April 19, following findings by the police that many were out late at night on the pretext of wanting to make money withdrawals from ATMs. “The public, however, must keep complying with social distancing protocols while using the ATMs,” he said at the daily media briefing on the CMCO here today. By the end of May 30, Malaysia had confirmed 7,762 COVID-19 cases, including 115 deaths./. Over 115.7 million USD poured into upgrading Thi Vai int’l port Thi Vai International Port Co., Ltd (TVP) has announced its investment of more than 2.7 trillion VND (115.7 million USD) in improving land at the Thi Vai international port in the southern province of Ba Ria-Vung Tau. The company plans to select four contractors to implement the project, with bidding sessions scheduled to open in the second quarter of 2020 and the first quarter of 2021. The total funding for the project is set to be sourced from TVP’s capital and commercial loans. Covering over 42,000 square metres, the port can receive 50,000DWT container vessels and 5,000DWT ferries. Along with the main quay with a length of 300m and a width of 27m, the port has a 155m long and 130m long ferry wharfs, and two 40 tonne cranes. TVP is a joint venture of five investors, two from Vietnam and three from Japan./. COVID-19 obstacle but also motivation to promote digital transformation The COVID-19 pandemic showed the important role of digital transformation in prevention and control activities, bringing life to a “new normal” state. The pandemic is both an obstacle but also a motivation to promote comprehensive digital transformation in all fields, in each enterprise, each organisation and individual. This year has been identified as the beginning year of national digital transformation to move towards a digital Vietnam. The Vietnam Digital Transformation Award 2020 has been officially launched. Over two years of launching, the award has attracted attention and received registrations from hundreds of technology enterprises. The organisers will receive registrations until June 30. The awarding ceremony is expected to be held in September. “The biggest goal of the organising committee set at this time was through the awards, technology enterprises continued to confidently research and create Vietnamese practical technology products and other businesses and organisations bravely changed the development model based on the application of digital technology to create a breakthrough development,” said Nguyen Minh Hong, head of the organisation board and chairman of the Vietnam Digital Communications Association. Nguyen Huy Dung, director of the Authority of Information Technology Application, Ministry of Information and Communications, affirmed that the organisation of the award was to find and honour specific solutions and digital transformation stories and thereby contribute to change people's perception about the role of digital transformation. The award also aims to spread social influence in the public, where the honoured products belong and exist to serve the people. When it comes to digital transformation, people often pay attention to the "digital" but skip the "transformation". Most businesses and organisations think that just buying and applying technology will improve their productivity immediately. In fact, digital transformation needs a comprehensive process, maximum support in the process of completing complex administrative procedures, shortening time and effort. Most enterprises and organisations were currently aware of the implementation of digital transformation to improve labour productivity and optimise costs but if having such thinking, they can not do it successfully, said Dung. Successful digital transformation required comprehensive transformation of all activities of agencies and organisations to generate new values, he said. In the technology flow, digital transformation was no longer an option but has become a vital factor for the development of businesses, said Dung. The Vietnam Digital Transformation Award was a communication channel of digital transformation, digital economic development for the whole society, through the introduction of new technology solutions and successful digital transformation models, which helps society better understand digital transformation and digital technology as well as help organisations and businesses find a suitable direction./. PM targets powerful, prosperous status for southern key economic region by 2035 Prime Minister Nguyen Xuan Phuc on May 30 requested the southern key economic region to strive to become a powerful and prosperous region by 2035, ten years ahead of the deadline for the same goal for the whole Vietnam. He made the remarks while chairing a meeting in Ba Ria-Vung Tau province between permanent Government members and officials of the eight localities in this region, which comprises Ho Chi Minh City and the seven provinces of Dong Nai, Binh Duong, Binh Phuoc, Ba Ria-Vung Tau, Tay Ninh, Long An, and Tien Giang. The southern key economic region is the only of its kind in Vietnam that boasts sufficient conditions and advantages for industrial and service development to achieve a fast, efficient and sustainable growth. It is currently the largest FDI magnet of the country, a leading economic driver, and a gateway for Vietnam’s trading with the world. Addressing the event, PM Phuc applauded the eight localities’ attainments in COVID-19 prevention and control, social security ensuring, and economic development, which have joined the entire country’s efforts to defeat the pandemic. He also highly valued their resolve in economic development and persistence with the initial targets set for this year. Regarding the region’s development goal, he emphasised that this is the key among the four key economic regions of Vietnam, describing it as a “diamond octagon” in Southeast Asia as well as Asia given its economic development and healthy living environment. The PM pointed out that the strength and competitiveness of this region outpace the others’, asking the localities to bring into play their solidarity and join hands to innovate and hold responsibility for national development. Responding to proposals submitted at the meeting, PM Phuc assigned relevant agencies to devise special mechanisms for key economic regions, especially the southern one. He told the Ministry of Planning and Investment to consider an aid package from the Government for the localities to invest in urgent infrastructure and transport facilities – a factor of leading importance in local socio-economic development. Meanwhile, the State Bank of Vietnam and the Ministry of Finance need to work on solutions to facilitate credit institutions’ engagement in infrastructure development projects, particularly those under the private-public partnership (PPP). The Ministry of Transport has to establish projects on boosting transport connectivity among industrial parks and economic zones in the region. The eight localities need to prioritise developing digital economy, e-commerce, and the 5G network, which are crucial for high technology development, according to him. At the session, the PM also asked them to implement the Government’s recently-issued Resolution 84/NQ-CP well so as to further tackle production and business difficulties and stimulate consumer demand which is an important driving force for GDP growth. Prior to the meeting, PM Phuc had made a fact-finding tour of Cai Mep-Thi Vai Port in Phu My town, Phuoc An Bridge, the location of the Cai Mep Ha logistics project, and Hyosung Industrial Park in Ba Ria-Vung Tau./. Viet Nam wood products exports increase by 6 per cent despite pandemic Exports of wood and wood products in the first four months of the year were worth nearly US$3.2 billion, a year-on-year increase of 6 per cent, according to the General Department of Customs. Though the Covid-19 pandemic has had a negative impact on the wooden processing industry, thanks to Viet Nam’s effective control of the outbreak and competitors in Southeast Asia, the EU and the US having to stop production, businesses have found new markets, Le Minh Thien, chairman of the Binh Dinh [Province] Timber and Forest Products Association, said. Besides, an improvement in the country’s business and investment environment has helped boost the industry’s manufacturing and export activities, he said. Do Xuan Lap, chairman of the Viet Nam Timber and Forest Product Association (VIFORES), said thanks to its efficient pandemic control, Viet Nam has become an attractive investment destination for many wood processing companies with turnover in the billions of dollars. Viet Nam expects the wood processing industry’s exports to top $12.5 billion this year, up 10 per cent from last year, according to VIFORES. Of this, $8.68 billion will come from timber exports and $2.99 billion from wood products exports, with other forest products accounting for the rest. So far this year exports to the US have seen a sharp rise, while there has been robust growth in shipments to Japan, the UK, Canada, Germany and the Netherlands, the Ministry of Industry and Trade’s department of import-export said. With Japan and Canada also being members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), it said Vietnamese firms are starting to take advantage of the reduced tariffs under the trade deal to penetrate these markets. With the EU-Vietnam Free Trade Agreement (EVFTA) set to take effect this year, Vietnamese firms can also look forward to similar tariff cuts by and increased exports to the EU, already one of Viet Nam’s major markets. The country’s top 10 markets are the US, Japan, China, South Korea, the UK, Germany, Canada, Australia, France, and the Netherlands. Viet Nam mainly exports dressing tables and kitchens and bathroom furniture to the US and EU. Exports of outdoor and office furniture account for only 40 per cent of the total, and so there is great potential to increase them in future, Deputy Minister of Agriculture and Rural Development Ha Cong Tuan said. The industry must restructure the whole production chain, from varieties of trees to promoting sustainable forest management, and implement its commitments under the EU-Viet Nam Voluntary Partnership Agreement on Forest Law Enforcement, Governance and Trade (VPA-FLEGT) to ensure its exports of timber and wooden products come from legal sources, he said. Design and branding are thus important factors in improving the competitiveness of Viet Nam’s furniture and other wooden products, he added. Wooden and furniture products are mainly produced in southern and central provinces like Binh Duong, Dong Nai, Long An, Tay Ninh, and Binh Dinh. VNN |
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