Chinese contractor demands US$50m for system operation of Cat Linh-Ha Dong project01:45 While the completion date of the Cat Linh-Ha Dong urban railway project in Hanoi is not yet known and the inspection dossiers have not been completed Chinese contractor China Railway 6 Bureau Group has requested US$50 million for the system operation before handing over the project.
The Railway Project Management Unit has reported the issue to the Ministry of Transport, noting that the payment must comply with the regulations of the engineering procurement and construction contract, according to Nguoi Lao Dong newspaper. “The two sides have agreed to review the provisions of the contract within 15 days and organize a meeting to discuss the works that need to be completed,” the unit noted. The 13.05-kilometer Cat Linh-Ha Dong urban railway was designed to have 12 stations and one depot. The funding needed for the railway project has surged from the initial estimate of VND8.7 trillion in 2008 to a staggering VND18 trillion including VND13.9 trillion borrowed from the Chinese Government and VND4.1 trillion in reciprocal capital. Work on the project began in October 2011, and the railway was initially scheduled to be put into commercial operation in 2015. The railway is basically complete but is yet to be put into operation due to problems related to technical equipment at the depot, the safety assessment of trains, system operation activities and final settlement of the contract and payment. In February, over 100 Chinese experts failed to return to Vietnam amid fears of the coronavirus pandemic, delaying the trial operation of the railway. However, on April 24, the Government agreed to allow entry to experts working on the project. The Railway Project Management Unit has asked the Chinese contractor to complete the as-built documents and inspection dossiers for components such as the technical equipment, design of stations and depot. Regarding the system safety certification, the unit will work with ACT Consulting and the Chinese contractor to complete it in line with the laws in Vietnam. According to the Government, the completion date for the project has not yet been decided and the responsibilities of organizations and individuals for the slow progress have not been made clear; so, capital has not been allocated for the construction supervision package. To address these obstacles, the Railway Project Management Unit suggested that the Ministry of Transport report the problems to the Government for solutions, extend the construction supervision package, and organize meetings with the Chinese contractor to discuss capital demand for the trial operation of the railway. SGT |
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Vietnam’s beer market expects big changes in 2020 02:25 Vietnam’s beer market is forecast to see big opportunities this year, as the country has always been held great potential for domestic and foreign beer enterprises. Fierce competition is incoming, as more foreign brands are looking to tap the market.  A production line of Sabeco (Photo: VNA) Vietnam’s beer market is forecast to see big opportunities this year, as the country has always been held great potential for domestic and foreign beer enterprises. Fierce competition is incoming, as more foreign brands are looking to tap the market. The information was released in the Vietnam Industry Research and Consultancy (VIRAC)’s latest report. With a population structure among the youngest in the world – 56 percent of the population is under the age of 30 – Vietnam Beer Association (VBA) predicts that total consumer expenses in Vietnam will double and reach approximately 173 billion USD by 2020. According to a Nielsen report, 56 percent of Vietnamese consumers are under 30 years old and Vietnam’s middle class will double from 12 million (in 2014) to 33 million (in 2020). It is estimated that Vietnam will have two million more consumers joining the middle class, becoming the fastest-growing middle class segment in Asia. The strong export markets of Vietnam, such as ASEAN countries and China, are all markets with high growth in food and beverage consumption. Along with a series of free trade agreements, Vietnamese food and beverages have been largely able to access key free export markets (without tariffs). In the context of international economic integration, mergers and acquisitions (M&A) will contribute to raise the size, competitiveness, market share, reputation and efficiency of larger businesses and start a new development cycle. For example, Thai Beverage, a company owned by a Thai billionaire, spent 110 trillion VND (4.8 billion USD) to buy 53.59 percent of Saigon Beer Alcohol and Beverage Company (Sabeco) in December 2017. This is not only the largest M&A deal in Vietnam’s history, but also the largest M&A deal in the Asian beer industry. In 2019, the total beer production will reach more than five billion litres (up 22.9 percent over the same period in 2018); consumption reached over four billion litres (up 29.1 percent over the same period last year). Beer sales reached over 65 billion VND (up 0.5 percent over the same period last year). Regarding types of consumption, canned beer consumption accounted for 66.8 percent of total beer consumption in Vietnam, followed by bottled beer 29.9 percent; while draft beer is 3.1 percent and accounts for a modest market share of fresh beer at 0.1 percent. Regarding imports, the imported beer output reached more than 37 million litres (an increase of 8.9 percent compared to the same period in 2018). The three main sources of beer supply in Vietnam are the Netherlands (25 percent), Mexico (17 percent) and Belgium (16 percent). Compared to beer consumption in Vietnam, beer imports into the country account for a relatively small proportion. Domestic and FDI beer enterprises dominate the domestic market, with the advantage of cheap beer prices, which suits the taste of the majority of customers. Regarding exports, the export beer output increased 46 million litres over the previous year, reaching 45.87 million USD. The export volume decreased by about 7 percent over the same period. The main reason is that Vietnam’s beer quality has not been highly appreciated and not created a brand in the international market. Equatorial Guinea (about 20 percent) is the largest market for Vietnamese beer. The law coming into effect on January 1 has been effective in adjusting the drinking habits of many people. It is forecasted that the beer industry growth rate in the year will not maintain the double-digit level as in previous years; reach 6-7 percent in the following years, although each year Vietnam has 1 million more people of legal age to drink alcoholic beverages. In the stock market, shares of the two “giants” in the beer industry, Sabeco and Habeco, have dropped from 0.4 percent to 0.8 percent. Meanwhile, the share value of the entire industry will decline by nearly 13 percent in 2019. Experts predict that the beer and wine industry will adjust towards a shrinking trend by 2020, in which small businesses will be most affected. Alcoholic beverages in Vietnam have to pay taxes at two stages of import and domestic consumption, including three different taxes: import tax (from 5-80 percent depending on type of FTA), tax value added (10 percent) and excise taxes (up from 50 percent to 65 percent in 2018). This can affect the profitability of beer companies, especially those in the mid-end segment, as this is a competitive segment and customers are most vulnerable to the impact of the best-selling prices. Production license can be considered a major obstacle for new businesses. To open a beer factory in Việt Nam, businesses must be licensed by the Ministry of Industry and Trade. While the regulations are quite clear, implementation can be difficult. Even if all provinces were willing to facilitate new breweries to collect taxes, the licensing would depend on the beer and beverage planning of the ministry, which may have been registered many years in advance. According to VIRAC, Vietnam’s beer industry still faces many challenges such as communication, risks of changing consumer tastes and M&A, requiring continuous efforts and improvement to enhance the position in the international market./. VNA |
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BUSINESS NEWS HEADLINES JUNE 302:03Does digital transformation help Vietnamese businesses make their fortune?During the recovery period after the COVID-19 pandemic, according to experts, digital transformation will help Vietnamese businesses, especially small and medium enterprises find a more flexible business model as a way of both reducing costs, and optimizing resources to overcome difficulties. The world economy has witnessed many fluctuations after the global coronavirus outbreak with social distancing measures, unwanted choices becoming a temporary solution on an unprecedented scale. However, this is really an opportunity for people to realize the superiority of the digital economy towards accelerating digital transformation process. Prior to the COVID-19 pandemic, the International Data Coperation had predicted that, by 2022, the value of digital transformation in the world will be estimated at US$2,000 billion and grow 4 times higher than the average growth of the information technology service market and after the pandemic, things are forecast to get even faster. In Vietnam, according to 2019 reports on Southeast Asia’s Digital of Google, Tamesek and Bain & Company, the digital economy of Vietnam and Indonesia posted a leading growth rate of around 38% in Southeast Asia and is expected to reach the target of US$ 43 billion by 2025. The COVID-19 epidemic has dealt a devastating blow to the economy, affecting every industry that is undeniable. However, according to experts judging from a positive perspective, the epidemic is promoting the development of infrastructure, technology and workflow in the direction of everything moving to the online model, technology is forcing businesses to conduct their digital transformation more strongly than before. During the past time, many enterprises operating in different sectors have applied digital technology in production, particularly in sale service. Experts recommend that when starting digital transformation, businesses need to anticipate difficulties they face. According to statistics, 9 out of every 10 business owners in the world commence a digital transformation strategy and among them 7 failed to deploy this new business model. Ass.Pro.Dr Dinh Trong Thinh, senior lecturer of the Academy of Finance, said that in order to be successful in digital transformation, businesses must have hardware, software to conduct transactions based on digital technology platforms. In additional, the initial step requires a certain cost, but it is not too expensive. Security is viewed as another major issue in this process so it is necessary to choose reliable partners who are able to map out a development vision with high confidentiality. Therefore, the association between businesses and digital technology subjects is very important. Besides, businesses also need to modernize the production process and familiarize themselves with digital technology platforms while relevant agencies should revamp policies regarding e-business, security so that firms can apply appropriate business methods and use their cash flows in the most reasonable way, thereby boosting ecommerce development. According to Dr. Nguyen Duc Thanh, former director of the Institute for Economic and Policy Research (VEPR), any country that understands the role of digital space and transform, it successfully can get face lift. The digital transformation strategy is not an easy task but it needs to be done to keep abreast with the world trend. One of the important pillars of digital transformation is cloud computing technology. Currently, Vietnam’s leading technology enterprises have taken steps to catch up with this trend and the demand for cloud computing technology is also growing strongly. The digital transformation by cloud computing platform helps build an ecosystem covering Vietnamese cloud computing enterprises who are able to master technology, provide standard cloud infrastructure and services as a means of promoting Vietnamese enterprises’ digital transformation and recover better during the post-COVID-19 period. Vu Minh Tri, general director of VNG CLOUD, Chairman of Cloud Club and Vietnam Data Center highlighted the readiness of the Vietnamese engineering team, and the training for customers to use on-site applications as a dominant factor of domestic cloud computing technology enterprises compared to foreign suppliers. With these advantages, it is expected that cloud computing technology will be widely used, not only for service providers but also for service using businesses. "Local firms must be ready to operate on a digital platform to ensure that each employee of a company is able to work and connect with each other. How to interact online with suppliers and partners is the trends that will greatly change the way Vietnamese businesses operate after the COVID-19 epidemic," he noted. Vietnam-China trade conference focuses on building materials, décor An online trade conference between Vietnam and China was held in Hanoi on June 2, focusing on construction materials and interior and exterior décor. Head of the Trade Promotion Agency Vu Ba Phu said this was the second conference jointly held by the Agency and the Department of Commerce in China’s Guangxi Zhuang Autonomous Region (GZAR) over the past two months, as part of a trade promotion agreement signed by the two offices and 10 northern Vietnamese localities in June 2019. The conference aimed to realise a common view held by Minister of Industry and Trade Tran Tuan Anh and Secretary of the GZAR’s Party Committee Lu Xishe on intensifying measures and cooperation between Guangxi and Vietnamese localities to resume trade and economic activities. The production and trade of construction materials and interior and exterior décor depend very much on the real estate market. Real estate in both Vietnam and China, however, has been downbeat since virtually the beginning of the year, especially since COVID-19 broke out. Enterprises in the two countries operating in the field should therefore intensify their cooperation and adopt methodical investment strategies on finance and technology to anticipate new opportunities when the pandemic is defeated. Jiang Liansheng, Director of the GZAR’s Department of Commerce, said the two sides have organised numerous fairs on construction materials and interior and exterior décor. Two-way trade of household appliances, building materials, décor, and sanitary equipment rose from 24.78 billion USD in 2017 to 39.73 billion USD in 2019, of which turnover of building materials and décor increased from 7.16 billion USD to 14.76 billion USD, for average annual growth of 53.1 percent. Phu stressed that his agency is willing to facilitate links between enterprises from Vietnam and Guangxi./. HCMC banks offer support for 224,000 virus-hit businesses  Banks in HCMC have lowered their interest rates and rescheduled loans worth VND290.5 trillion (US$12.4 billion) for around 224,000 firms and household businesses reeling from the coronavirus pandemic. The State Bank of Vietnam (SBV) held a conference on Friday to discuss measures to support affected individual and corporate clients of banks in HCMC, reported the Vietnam News Agency. As of late April this year, banks in HCMC restructured the repayment of loans worth VND51.8 trillion (US$2.2 billion) for more than 162,700 clients, said Nguyen Hoang Minh, deputy director of the central bank’s HCMC branch. Minh said local banks cut interest rates for over 17,700 clients whose outstanding loans totaled over VND48.7 trillion (US$2.09 billion). From January 23, they also gave out new loans worth VND190 trillion (US$8 billion) to over 43,400 existing clients. As of late April, banks offered short-term loans worth some VND165 trillion (US$7 billion) at interest rates of less than 5% to more than 31,500 clients in five priority sectors. The preferential rates are applicable to businesses specializing in agricultural and rural development, importers and exporters, small- and medium-sized enterprises and enterprises in supporting industries, hi-tech firms and hi-tech agriculture companies and start-ups. Of the VND165 trillion, SMEs borrowed over VND117 trillion (US$5 billion), accounting for 71% of the total outstanding short-term loans. Connectivity programs between banks and enterprises have been frequently held to enable firms and household businesses to have access to bank loans, as well as policies on the central bank’s low-interest loans. However, the adoption of policies that support firms affected by the coronavirus pandemic has been fraught with difficulties, noted Minh. Representatives of financial institutions said they find it difficult to ensure adequate legal documents including evidence of damages, genuine clients, conditions for support and their financial reports. The transparency and accuracy of the information and the basis for comparison and verification also pose a challenge for banks because documents of evidence are usually provided by one stakeholder. SBV’s deputy governor Dao Minh Tu asked local banks to immediately classify groups of individual and corporate clients and instruct them on how to take out loans. Firms that are seeing severe losses will receive considerable support from banks, said Tu. He also demanded that banks reform their administrative procedures to help shorten the time taken to handle loan applications. Vietnamese fruits vying for the lion’s share on home turf  VOV.VN - The local fruit sector has been advised to devise a strategic plan in which to competently deal with fierce competition from foreign rivals due to newly-implemented free trade agreements (FTAs) set to boost the strong influx of foreign fruit into the Vietnamese market, according to industry insiders. Nguyen Dinh Tung, General Director of Vina T&T Import Export Service Trading Services Co. Ltd, says that Vietnamese fruit products consistently fail to be displayed in an eye-catching manner in comparison to foreign fruit at supermarkets, noting that this marks the most significant reason why the company is investing in the domestic retail chain in order to sell Vietnamese fruits. Despite this, Tung points out the challenges which occur when attempting to win local consumers’ trust following recent violations of food hygiene and safety regulations of several local products. Moreover, he notes that the country’s participation in new-generation FTAs has made local fruits face increasingly fierce competition from cheap imported ones, which are generally favoured by the majority of consumers in the domestic market. Nguyen Quoc Trinh, Chairman of the Dragon Fruit Association of Long An province, admits that dragon fruit, which is a particularly popular item among Vietnamese people, has failed to seize upon the opportunities from the domestic market, and farmers remain uninterested in selling dragon fruit locally. “Dragon fruit is sold for between VND2,000 and VND3,000 per kilo, or sometimes VND5,000 per kilo at a maximum in the domestic market, while the export price of dragon fruit generally hovers between VND30,000 and VND40,000 per kilo,” Trinh explains the reason why growers prefer shipping the product abroad. Moreover, domestic consumers have a tendency to purchase one type of dragon fruit while importers globally tend to purchase all three types of the item, leading to limited consumption among the local market. According to statistics, the import of fruit and vegetables has increased from between US$200 and US$500 million per year in the period from 2008 to 2014 to US$622 million in 2015, rising further to US$925 million in 2016, US$1,547 million in 2017, US$1,755 million in 2018, and US$1,775 million in 2019. The majority of fruit and vegetables found in the domestic market are imported from places such as Thailand, China, the United States, Australia, New Zealand, India, Myanmar, the Republic of Korea, South Africa, and Chile. The fact is that several Thai fruits such as mangosteen, durian, mango, and rambutan are selling well in the domestic market at competitive prices. For instance, mangosteen prices fluctuate between VND25,000 VND50,000 per kilo, while Thai mangoes and rambutans are typically sold between VND30,000 and VND60,000 per kilo. The Hoc Mon farm produce wholesale market in Ho Chi Minh City states that since May, approximately 10 tonnes of Thai fruits are being transferred to the market each day, including mangosteen, bonbon, and tamarind. Experts have therefore advised the local fruit sector to take fast action in a bid to dominate the domestic market, noting that the expansion of distribution channels among the domestic market remains of great significance amid the recent negative impact of the novel coronavirus (COVID-19) pandemic. In order to boost fruit consumption in the domestic market, Vina T&T CEO Dinh Tung recommends that businesses swiftly boost the spread of information with regard to the quality of local fruit products as a way of increasing consumers’ confidence in Vietnamese fruits. Tung also points out that the fruit sector should strive to overcome inadequacies regarding the processing, storage, and distribution stages in a bid to improve product quality. Vu Kim Hanh, Chairwoman of the Business Association of High-Quality Vietnamese Goods, emphasised that after the COVID-19 pandemic, businesses and farmers must work together in order to seek outlets for fruit products. “It is necessary to strengthen co-ordination among the State, localities, relevant ministries, and co-operatives to build and connect the value chains for the sector,” says Hanh. She also warns about the use of pesticides by farmers when attempting to grow fruit quickly, saying this practice will kill the fruit sector in the long term. VPBank confident of beating 2020 profit target The Vietnam Prosperity Joint Stock Commercial Bank expects to beat the 2020 profit forecast despite the downturn caused by the COVID-19 outbreak, CEO Nguyen Duc Vinh said on Friday. In the first quarter pre-tax profit was up 63.3 per cent year-on-year to more than VND2.9 trillion. It increased to VND4 trillion in the first four months, and is expected to top VND5.1 trillion by May end, or 50 per cent of the year’s target, Vinh told the lender’s annual general meeting. “Profit is expected to exceed VND6 trillion by June. The board of directors is confident the bank can beat its profit forecast by 10-12 per cent.” The forecast was trimmed following the pandemic outbreak. VPBank, as the lender is commonly known, sees full-year profit sliding by 1.1 per cent to VND10.214 trillion. It also expects total assets to rise by 12.7 per cent to VND425 trillion and loans outstanding by 12.3 per cent to VND304.74 trillion. Deposits are forecast to rise by 10.4 per cent; the non-performing loans ratio is expected to be below 3 per cent. The board had originally eyed a 29 per cent rise in full-year profit to VND13.5-14 trillion, Vinh said. But with COVID-19 outbreak having a severe impact on both global and Vietnamese economies, the board of directors had to amend it, he said. “The top priority now is to ensure capital adequacy and become more resilient in the face of the economic downturn.” The pandemic is expected to be controlled by June and economic activities are likely to revive subsequently, enabling banks and other businesses to recover, he added. In 2019 VPBank had earned a record pre-tax profit of VND10.33 trillion after rising by 12.3 per cent. No dividends VPBank does not plan to pay a dividend for 2020. Its entire undistributed profit of VND7 trillion will be used to increase charter capital and fund business activities. The board of directors also unveiled plans to buy back all international bonds in 2020 or 2021 depending on market conditions. According to chairman Ngo Chi Dung, the bank has begun preliminary talks to sell up to 49 per cent in its consumer finance arm, FE Credit. The money from the deal will be spent on its retail and SME divisions. VPBank shares (HoSE: VPB) rose 1.1 per cent to end Friday at VND23,350. Savico appoints new management board amid foreign divestment Saigon General Services Joint Stock Company (Savico) has appointed a new board of directors for the next five years with seven Vietnamese members, while the only foreign member was removed from the new board. The move won 99.53 per cent of shareholders’ votes in its annual shareholders’ meeting on Friday in HCM City. Savico’s management team is in a transition period for the 2020-25 term and any changes to the management board have received a great deal of attention, especially after its major foreign shareholders sold more than 44 per cent of their stakes before the shareholders’ meeting. Mai Viet Ha, chairman of Savico Da Nang, was appointed the new chairman, replacing Nguyen Binh Minh who resigned last October. Phan Duong Cuu Long will be the general director and the company’s legal representative. The management board has three new faces – two members from the parent company Ben Thanh Trading & Service Joint Stock Company and one from DNP Corporation (under Dong Nai Plastics Co). With the entire divestment, the representative of the Endurance fund, board member Lars Johan Gerard De Geer, was removed from the new board. In April, Savico’s foreign shareholders sold almost their entire stakes, reducing their holdings in Savico from 47.4 per cent to more than 3 per cent. In a recent report, Pyn Elite Fund said “an ownership tussle in the company opened a window of opportunity for our sell-out”. With about 3.6 million euro (US$4 million) in cash from the deal, the fund said it booked a slight loss from the deal. Savico is Viet Nam’s biggest car dealership chain, selling many different brands such as Toyota, Ford and Huyndai. The number of vehicles sold by its dealer network in 2019 hit 40,500, up 28 per cent year-on-year, equivalent to more than 10 per cent of all cars sold by Viet Nam Automobile Manufacturers Association (VAMA) and Huyndai Thanh Cong. Responding to concerns over the foreign divestment, chairman Mai Viet Ha on Friday said Savico is a listed company so share selling/purchasing or changes in shareholders was normal based on market demand. According to Ha, all major foreign shareholders divested due to their own needs and strategies and were replaced by a group of domestic investors. At the meeting, the firm also amended its charter to mean large shareholders will not be able to make use of their advantages to affect the rights and interests of the company and other shareholders while at the same time, they must disclose information as prescribed by law. In addition, it also made changes in regulations related to providing personal information of board members and responsibilities of the Board of Directors and the Supervisory Board when not convening general meetings of shareholders. Due to unstable developments in the global market, Savico lowered its revenue target for 2020 by 19 per cent to nearly VND14.8 trillion ($635.2 million) and halved the net profit goal to VND108 billion ($4.6 million). The dividend payout will also be slashed to 7 per cent. This year, the company also plans to issue more than 8 million shares to raise charter capital at the ratio of 1:3. Revenue to drop fifth in Q2: FPT Retail Second-quarter revenue is expected to drop 15-20 per cent from the first quarter due to COVID-19, FPT Retail Chairwoman Nguyen Bach Diep said on Thursday. Revenue in the first three months rose 1.9 per cent on-year to VND4.14 trillion (US$179 million) while profit fell 44.7 per cent on-year to VND35.6 billion. FPT Retail performed well in the first two months of the year, but the coronavirus outbreak in March stalled the business, the chairwoman said at the annual shareholders’ meeting. In April, FPT Retail closed 170 or a third of all FPT Shop stores across the country due to the social distancing order, she said. The stores were re-opened in May but demand dropped as customers’ income was affected, leading to lower consumption of non-key products such as phones and electronic devices, Diep said. Poor performance in the first three months made FPT Retail lower its revenue forecast by 8 per cent on-year to VND15.32 trillion in 2020. Full-year pre-tax profit was predicted to decline a fifth to VND220 billion. The company offered shareholders a maximum 15 per cent cash dividend for 2020. ICT device sale revenue is forecast to drop 14 per cent on-year to VND13.82 trillion in 2020. The figure in 2019 was VND16.1 trillion. The pharmaceutical store chain Long Chau was expected to pick up during the year. In 2020, FPT Retail plans to open 150 new Long Chau drug stores in the country to raise the total to 220 and upgrade technological system to cut costs and improve the benefits to consumers. The drug store segment is expected to triple its revenue in 2019 to VND1.5 trillion at the end of this year. Revenue of the digital retain chain FPT Shop was VND3.85 trillion and that of pharmaceutical store chain Long Chau was VND239 billion in the first quarter of the year. FPT Retail shares (HoSE: FRT) soared 5.2 per cent to end Friday at VND26,200 apiece. Thailand's parliament approves 58 billion USD economic package Thailand’s parliament on May 31 passed a stimulus package worth 1.9 trillion THB (58 billion USD) to ease the impact of COVID-19. The legislation, comprising three bills, includes a government plan to borrow 1 trillion THB and central bank measures worth another 900 billion THB in soft loans and support for corporate bonds. Of the 1 trillion THB of borrowing, 600 billion THB will be for public heath works and relief measures, and the rest for rebuilding the economy and job creation. The bills must next be approved by the upper house Senate, which is expected to convene in early June, before they can become law. The latest steps follow billions of dollars of stimulus measures introduced earlier this year to cope with the impact of the coronavirus on the Thai economy, which is heading into a recession. Thailand began to gradually ease some restrictions introduced to contain the virus in early May. More businesses classified as medium to high risks, including cinemas and gyms, will be allowed to reopen on June 1. Thailand’s central bank has said it expects the economy to sharply contract this year as the pandemic hit businesses and households. Meanwhile, the Thai National Economic and Social Development Council said 8.4 million people are at risk of losing their jobs this year due to the COVID-19 pandemic, with the tourism sector being most badly affected. It estimated that the fall in the number of foreign and domestic tourists could mean 2.5 million people, or 64 percent of the approximately 3.9 million workers in the tourism sector, could become unemployed. It said in a report that 1.5 million, or 25 percent of the 5.9 million person industrial workforce, also could be laid off due to the coronavirus crisis reducing demand that was already weakened by trade wars. The jobs of 4.4 million people, or 43 percent of 10.3 million people working in the service sector outside of tourism, are also at risk./. Cambodia promotes domestic tourism Tourist destinations across Cambodia welcomed nearly 400,000 visitors during the first three weeks of May, said the country’s Minister of Tourism Thong Khon. Of the figure, there were 390,922 domestic tourists and 7,177 foreigners. With increasing domestic tourist movements, the Ministry of Tourism has been working closely with the private sector to implement epidemic preventive measures for tourism safety following the Ministry of Health’s guidelines. However, domestic tourism alone will not be enough to keep hotels from losses and closures. Hoteliers need foreign holidaymakers, said a manager of a large hotel in Cambodia, adding that they are aware the tourists cannot yet arrive in droves because of prohibitive but necessary measures to curb the COVID-19 pandemic. He suggested that the Cambodian government should look at measures to enable foreign tourist arrivals, encourage more flights from countries which have flight connections to Cambodia and a resumption of flights within ASEAN, maybe even tourist visa waivers and other measures. On May 20, the country lifted a ban on entry of visitors from Iran, Italy, Germany, Spain, France and the US that had been put in place to curb the spread of COVID-19. However, foreign visitors would still need to have a certificate no more than 72 hours old confirming that they are not infected with the virus and proof of 50,000 USD worth of health insurance while in Cambodia. They also would be quarantined for 14 days after arrival and tested for COVID-19./. Large corporations play crucial role in local startup survival A number of major corporations have exerted a significant impact on domestic startups as they get to enjoy a number of benefits when investing in new firms, said Tran Xuan Dich, deputy head of the Market and Business Development Department under the Ministry of Science and Technology. Recent years have seen Vietnam’s innovative start-up ecosystem witness dynamic growth and is now considered as the leading eco-system in all of Southeast Asia. According to statistics, the country’s startup ecosystem has seen 38 private investment deals, of which 28 deals have been made into startups between 2018 and the first half of last year. The involvement of major businesses and corporations to support innovative startups has become a popular trend globally, especially in countries with developed start-up ecosystem such as the United States, the Republic of Korea, and Singapore. Startup firms will therefore benefit from the support of large corporations in terms of capital and corporate governance experience, while major companies will receive potential business models that are expected to meet the requirements of customers through fresh technology platforms developed by innovative startups, according to Dich. Vu Tien Loc, Chairman of the Vietnam Chamber of Commerce and Industry (VCCI), states that large enterprises have played a significant role in assisting with the training of human resources, noting that these enterprises should move to create startup spaces in which for new projects to experiment. Loc also underlines the importance of new firms receiving support from large businesses by pouring investment into the country's ecosystem due to a limitation of state capital. Moreover, the majority of Vietnamese startups do not enjoy solid financial support, Loc noted, therefore making it difficult for these firms to survive amid fierce competition. The VCCI representative also emphasises the significant social responsibility of major business groups and investment funds in promoting the startup ecosystem and training future generations of entrepreneurs, as well as making contributions to the national economic development. Hoa Phat to export 120,000 tonnes of steel billets to China Steel maker Hoa Phat has signed a contract to sell 120,000 tonnes of steel billets, worth over 1 trillion VND (nearly 43 million USD), to China’s firm Hangzhou CIEC Group Co., Ltd. It is the largest order ever received by Hoa Phat. The order will be fulfilled with multiple deliveries between July and the end of August. The volume of steel are being produced at the Hoa Phat Dung Quat Steel Complex in the central province of Quang Ngai. Hoa Phat Group has been enjoying surges in steel exports in recent years. The company shipped abroad about 195,000 tonnes of steel billets in 2019, 97.4 percent of which were to China. In the first four months of this year, it exported close to half a million tonnes of the steel billets to China and ASEAN countries. Chinese importers accounted for 43 percent, or over 200,000 tonnes, of the volume. Last year, Hangzhou CIEC Group ordered more than 100,000 tonnes of steel billets from Hoa Phat./. Quang Binh cooperates with Hanoi, Da Nang to stimulate domestic tourism The Quang Binh provincial Department of Tourism, in collaboration with the Hanoi municipal Department of tourism and the Da Nang City Tourism Association, have held a conference on cooperation for local tourism. At the conference, representatives from travel agencies and businesses discussed measures to stimulate tourism in Quang Binh province following the Covid-19 epidemic, including the promotion of destinations in the media and discounts on tickets to tourist attractions. The tourism enterprises also introduced new preferential products and services to promote the potential and strengths of the province. The provincial authorities have directed local tourism enterprises to change the structure of tourist markets, shift products serving international visitors to being designed for domestic tourists, and diversify tourism products at reasonable prices. Representatives from airlines, railway and tourist vehicle businesses in Hanoi announced the stimulus policies together with attractive discounts. Director of Quang Binh provincial Tourism Department Ho An Phong said that the conference will create further cooperation amongst travel and transport businesses, tourist attractions, accommodation, restaurants and services, aiming to attract more visitors to Quang Binh – a safe and unique destination. Total retail sales ease to VND1.9 quadrillion in five months: GSO The total retail sales of goods and services in the first five months of this year fell 3.9% year-on-year to VND1.9 quadrillion, according to the General Statistics Office. Excluding inflation, the decline was 8.9% from January to May, compared with a growth of 8.5% during the same period last year. May saw some recovery, with the figure rising 26.9% against the previous month to VND384.8 trillion, suggesting that citizens have returned to a semblance of normality after several months of social distancing to curb the spread of the coronavirus infection. During the first five months of this year, the retail sales of goods accounted for 80.6% of the total to reach VND1.54 quadrillion, 1.2% higher than the same period last year. Of this, the sales of food and foodstuffs rose by 6.1%; household appliances, tools and equipment by 1.7%; garments and textiles dropped 11.4% and transport was down 7.4%. According to the report, the slight increase in the sales of retail goods was attributed to adequate supplies at supermarkets and shopping centers. Moreover, there were no pricing fluctuations while citizens shifted to online shopping. In contrast, the sales of accommodation and restaurant services saw a year-on-year slump of 25.8% to VND175.3 trillion. Although the services have resumed after a period of social distancing, the demand usually seen during summer holidays has declined as schools have reopened. Tourism revenue reached a mere VND8.3 trillion, accounting for 0.4% of the total and tumbling 54.1% year-on-year. Vietnam has paused issuing visas for foreign visitors given the complicated developments of the Covid-19 pandemic worldwide, while domestic tourism has yet to pick up. Other services saw a revenue of VND186.9 trillion during the period, making up 9.8% of the total and declining 11.8% over the same period last year. Action plan for HCMC’s “Eastern City” soon to be completed Chairman of the HCMC People’s Committee Nguyen Thanh Phong, head of the steering board on eastern innovation district development on May 29 asked the Department of Planning and Architecture to complete a draft action plan for the project's construction and send reports to the municipal People’s Committee. Main missions and solutions of the action plan are the adding content into the plan, land-use planing in districts 2,9 and Thu Duc, organizing the public consulting exchanges by the People’s Committees of districts, managing duration and process of the project. The Planning and Investment Department has called for investment while the People’s Committees of districts 2,9 and Thu Duc have updated contents of the highly interactive and innovation district to the East Ho Chi Minh City into the documents of the National Party Congress, and related breakthrough programs for infrastructure development to be carried out synchronously. The Department of Finance and the Department of Planning and Investment will propose the Department of Planning and Architecture to plan the project’s capital and sources of funds. Foreign capital keeps pouring heavily into Vietnam By May 29, the foreign capital flow still poured heavily into Vietnam. Accordingly, the total foreign investment capital, including additional capital, capital contribution, and purchase of shares, in the first five months of this year reached US$13.9 billion. Of these, 1,212 projects were granted investment licenses with a total registered capital of $7.4 billion. 436 projects that were licensed in previous years registered to adjust investments for additional capital of $3.5 billion. Especially, there were 3,528 times of capital contribution and purchase of shares of foreign investors with a total value of nearly $3 billion. Singapore was the country with the highest investment capital of nearly $4.4 billion among 58 countries and territories investing in Vietnam. Taiwan followed with $743 million, tailed by China with $695 million, Hong Kong with $500 million, South Korea with $447 million, and Japan with $221 million. It was recorded that the production and distribution of electricity, gas, steam, and air-conditioner received the highest newly-licensed foreign direct investment with the registered capital accounting for 53.8 percent of the total newly-registered capital. The industrial processing and manufacturing industry accounted for 37 percent. The remaining industries accounted for 9.2 percent. To receive this wave of foreign investment, the Government has instructed provinces to quickly complete the infrastructure of export processing and industrial zones and effectively implement measures and incentive policies to attract suitable investment for each field. In Ho Chi Minh City, the city’s leader has instructed the Ho Chi Minh City Export Processing and Industrial Zones Authority to quickly review the existing vacant land fund, at the same time promote the investment progress in new industrial parks to meet the diverse investment demand of enterprises. The city has 17 active export processing and industrial zones and is expected to increase to 23 zones by the end of this year. Tourism revenue reaches VND8,300 billion in the first five months According to figures released by the General Statistics Office (GSO) on May 29, tourism turnover in the first five months reached VND8,300 billion (over US$356 million), decreased 54.1 percent compared to last year due to the complicated developments of the COVID-19 pandemic Additionally, Vietnam temporarily suspended visa issuance for foreigners entering the country to prevent the spread of COVID-19; and domestic tourism has not been recovered from the disease when comparing the previous period. Some localities have significant declines in tourism revenue, including the southern coastal province of Ba Ria-Vung Tau (72.9 percent), the south-central coastal province of Khanh Hoa (68.2 percent), HCMC (66.1 percent), the northern province of Quang Ninh (65.4 percent), the Mekong Delta city of Can Tho (59 percent), Hanoi (54.8 percent), the north central province of Thanh Hoa (54.6 percent), the central coastal province of Binh Dinh (54.2 percent), Da Nang City (53.1 percent) and the northern coastal city of Hai Phong (32.5 percent). The report showed that the number of international tourists coming to Vietnam is more than 3.73 million, declined 48.8 percent compared to the same period last year. May saw the lowest number of foreign arrivals, falling 13.6 percent and 98.3 percent compared to the previous month and last year respectively because the country has continued to implement preventive measures against the disease and not allowed international visitors to enter Vietnam, but foreign experts and technicians who are working in the country. The General Statistics Office (GSO) announced that Asian travelers that accounted for 72.9 percent came from main markets with a sharp fall, such as China (down 57.2 percent), the Republic of Korea (53.4 percent), Japan (48.2 percent), China’s Taiwan (46.1 percent), Thailand (41.5 percent), Malaysia (53.9 percent). Notably, the number of Cambodian tourists increased 118.3 percent. Although seeing a noticeable decline in number of visitors, experts believed that is a golden time for domestic tourists who have opportunities to enjoy high-class tourist services and attractions which were only for international visitors visiting Phu Quoc, Nha Trang, Ha Long Bay, caves in Quang Binh at promotional prices as well as to create advantage for breakthroughs in the smokeless industry. Vietnam’s consumer prices declines 0.03% m/m in May The consumer prices, however, increased 4.39% year-on-year in the January- May period, the highest five-month growth rate over the last three years. Vietnam's consumer price index (CPI), the main gauge of inflation, in May saw a slight decline of 0.03% against the previous month, according to the General Statistics Office (GSO). The rate declined 1.24% versus the end of 2019, the lowest in the 2016 – 2020 period, but went up 2.4% year-on-year, resulting in an increase of 4.39% year-on-year of the CPI in the first five months of 2020, the highest five-month growth rate over the last three years. Four out of 11 commodity groups, which are components of the basket for CPI calculation, witnessed month-on-month declines in prices. Among them, transportation posted the sharpest decrease of 2.21%, mainly due to reductions in fuel prices on April 28 and May 15, shaving 0.21 percentage points off the overall CPI. Other groups that saw their prices down in May were post and telecommunications (-0.02%); culture, entertainment, and tourism (-0.02%); and garment, footwear and hats (-0.01%). Meanwhile, the seven groups that saw their prices up in May were food and catering services (0.34%); beverages and cigarettes (0.25%); housing, water and electricity supply, and construction materials (0.25%); household equipment and appliances (0.05%); medicine and healthcare services (0.04%); other goods and services (0.07%); only education remained flat. According to the GSO, core inflation in May went down 0.03% month-on-month, resulting in an increase of 2.54% year-on-year and a rise of 2.88% in the first five months compared to the same period of 2019. Bottlenecks in economic development take center stage at seminar The Central Institute for Economic Management (CIEM) organized a seminar in Hanoi City today, June 1, to bring to light certain bottlenecks in the post-Covid 19 economic growth strategy. Speaking at the seminar, CIEM President Tran Thi Hong Minh said that Vietnam has effectively brought the Covid-19 infection under control, so it is high time to determine the bottlenecks facing the country’s economy and work out suitable solutions. Among the obstacles in the post-Covid-19 economic development strategy, Nguyen Anh Duong, head of the Macroeconomic Policy Department at CIEM, put the emphasis on the plan to adopt e-Government, ensure coordination and the use of human resources. Duong also pointed out that complicated procedures have affected investments by foreigners in Vietnam, and suggested that apart from simplifying administrative procedures, Vietnam should issue standards and policies to facilitate business and investments from foreigners. After the pandemic ends, Vietnam’s effectiveness in administration will be strengthened, noted Dau Anh Tuan, head of the Legal Department at the Vietnam Chamber of Commerce and Industry. He said that in the future, the country should continue administrative reforms to create favorable conditions for enterprises, Thanh Nien newspaper reported. Speaking about the impact of Covid-19 on the country’s economy, Duong remarked that Vietnam’s growth is facing a downward spiral. In the first quarter of 2020, the growth rate was lower than the rates recorded during the same period from 2010 to 2019. Exports and trade activities have also declined since April. Aside from the efforts of local firms, access to foreign investments for sustainable development is necessary, Duong noted. VinFast recalls 12,450 Chevrolet cars in Vietnam VinFast, the exclusive distributor for General Motors' (GM) Chevrolet brand in Vietnam, is recalling over 12,450 Chevrolet Cruze, Orlando and Trax vehicles with airbag defects in Vietnam. Among these vehicles manufactured from January 2014 to 2018, the Cruze and Orlando cars were locally assembled, while the Trax vehicles were imported. All of them were distributed by GM Vietnam, Thanh Nien newspaper reported. The vehicle recalls, which received approval from Vietnam Register, were initiated after the airbags supplied by Takata were discovered to be faulty. The inflators of the airbags have been made in a way that allows moisture to penetrate over time, increasing the risk of injury to drivers and passengers, according to the automaker. To solve the problem, from May 20, VinFast began conducting free checks and replacing the front airbag inflators in the defective vehicles. The exercise is being carried out across VinFast dealerships nationwide. Checking and replacing inflators for each car takes some 30 minutes. For the safety of drivers and passengers, VinFast has called on owners of faulty cars to take their vehicles to VinFast dealerships for checks and replacements. The campaign will go on until May 20, 2022. On June 28, 2018, VinFast, an auto-manufacturing subsidiary of Vingroup, signed a strategic partnership agreement with GM. Under the agreement, VinFast became the exclusive distributor of Chevrolet cars in Vietnam and responsible for GM Vietnam’s after-sales service in the local market, while GM became the preferred automotive technology provider of VinFast. HCMC kicks off discount program for goods, services The HCMC Department of Industry and Trade has kicked off a large-scale promotion program from June 1 to July 30, allowing firms to offer discounts of up to 100% on the prices of products and services for the very first time. Alongside the program, the municipal department will organize a consumption promotion fair in Thu Duc District from July 2 to 5, which is expected to ramp up domestic consumption and help enterprises recover trade and production activities after the coronavirus pandemic is effectively controlled. The department is also planning to organize a conference on the connection between the seller and the buyer in September. Multiple supermarkets, commercial centers and some major electronics retailers such as Nguyen Kim and Thien Hoa have committed to participating in the program, stated the city’s department. Le Thi Thanh Lam, deputy general director of Saigon Food, told Thanh Nien newspaper that the firm will offer discounts to customers on various goods. Frozen products will be discounted by up to 50%, while the firm will offer higher discounts on clothes, footwear and handbags, she noted. A director of a fashion store chain stressed that although promotions can go up to 100%, very few firms would offer this rate. Most of them will offer discounts of up to 70% on some products, the director added. He also said that with the cap on promotions lifted, enterprises will have the opportunity to promote sales, which had dropped due to the coronavirus pandemic. Stating that the demand for goods at many member firms of the HCMC Rubber and Plastics Association is declining, Nguyen Quoc Anh, chairman of the association, said that offering discounts and promotions might be a solution to stimulate consumption. However, as the profit margins on the production activities of this industry are not high, many products including plastic washtubs, baskets and rubber tires will only be discounted by up to 20%. Anh hoped that more such programs and policies to support the poor and struggling firms would be launched. Thailand considers revamping 2018-2037 national strategy The Thai government is planning to make adjustments to its national strategy to keep abreast of changing social and economic trends caused by the global economic slowdown and the COVID-19 pandemic. Local media on June 2 quoted Chairman of the Thai Chamber of Commerce Kalin Sarasin, saying that its agency is helping to map out the country's new strategy for the post-pandemic period and plans to submit it to the government for consideration soon. According to Kalin, the 20-year national strategy in the 2018-2037 period and the 12th national economic and social development plan in 2017-2021, need revisions after the outbreak. The new national strategy will focus on developing promising industries such as food, tourism, healthcare, medical equipment and renewable energy, he said. Previously, the latest meeting of the National Strategy Committee of Thailand chaired by Prime Minister Prayut Chan-o-cha in April ordered the National Economic and Social Development Council (NESDC) to revise the master plan for the first five years (2019-2023) under the 20-year strategic plan. The national strategy, which came into force on October 13, 2018, has 23 master plans. Under those plans, there are 15 urgent flagship projects that must be implemented during 2019-2023. NESDC Secretary-General Thosaporn Sirisamphand said earlier that the agency is scheduled to propose a revised plan by September 2020./. Hanoi commits to creating stable environment for Thai businesses A Hanoi leader has pledged to create a stable environment for Thai businesses to engage in long-term investment and business operations in the city, calling for more firms from the neighbouring country to invest in Hanoi. Secretary of Hanoi Party’s Committee Vuong Dinh Hue made the commitment during a reception for the Thai Ambassador to Vietnam Tanee Sangrat on June 2. Hue informed his guest that Vietnam in general and Hanoi in particular has basically put the COVID-19 epidemic under control while maintaining a positive growth rate at 3.72 percent along with political security and social order and safety. He stressed that Hanoi is implementing concerted measures to restore the economy, including organising a major investment promotion conference on June 27. The official invited the Thai Ambassador and Thai businesses to attend the event, which demonstrates Hanoi’s resolve in attracting investment. Appreciating the success of Vietnam and Hanoi in particular in containing the COVID-19, Ambassador Tanee Sangrat said this year is a right time for the two countries to discuss mechanisms to promote and facilitate bilateral trade and investment. He suggested holding a joint workshop to look into trade and investment issues. The ambassador invited Hanoi to attend several annual exchange programmes held by Thailand in the time ahead, adding that the two sides should coordinate to organize cultural exchange events in Hanoi on the occasion of the 45th anniversary of the two countries’ diplomatic relations in 2021. The Hanoi leader affirmed his support of such joint events, and expressed his wish that flights between Vietnam and Thailand, and between Hanoi and Bangkok will be resumed early on the condition of ensuring safety for both sides. The Thai Ambassador said Thailand also shares this wish and is considering ways to realize it. The two sides agreed that the existing cooperation agreement between Hanoi and Bangkok has not matched their potential, and proposed that the two cities consider elevating their ties towards a twinning relationship./. VNN |
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Seafood sectors urged to diversify products21:00 Diversifying products and adapting quickly to market fluctuations will help create growth momentum and remove difficulties for seafood exports, experts have said.  A tra fish processing line for export. - VNA/VNS Photo Since the beginning of the year, exports of the two main seafood products of Việt Nam, tra (pangasius) fish and shrimps have declined sharply. Tra fish exports, in particular, were severely impacted by the COVID-19 pandemic, which had a negative impact on domestic production, pushing the tra fish price in the Mekong Delta region down. According to Việt Nam Association of Seafood Exporters and Producers (VASEP), tra fish import demand in China, which accounts for 22.5 per cent of Việt Nam's total export value, has recovered. However, other markets are still being affected by the pandemic. VASEP said tra fish exports to big markets would be unlikely to rise to positive growth rates compared to the same period last year till at least the end of the second quarter. This means fish farmers and businesses need to continue to balance farming, production and processing. The association forecast that China, the US and EU would still be major export markets for tra fish in the next five years, accounting for 65 per cent of the country’s total export value. Trương Đình Hòe, VASEP’s general secretary said the quality and requirements of food safety exported into these markets are increasingly strict. However, Vietnamese tra fish have met all market requirements, such as recognition from the US Department of Agriculture (USDA). In addition, the US Department of Commerce (DOC) lowered anti-dumping duties on frozen tra fish fillets from Việt Nam in the 15th period of review (POR15). The move was the DOC’s preliminary conclusion after investigating tra fish exported by certain Vietnamese firms from August 1, 2017, through July 31, 2018. In addition, most big Vietnamese tra fish exporters such as Vĩnh Hoàn Joint Stock Company and Biển Đông Seafood Company Ltd have continued to enjoy zero tax. This has been a positive for local tra and basa exporters in a difficult situation due to the pandemic. In the first quarter of this year, shrimp exports saw relatively high growth. In April, there was a sharp decrease due to COVID-19, but there are still opportunities for Việt Nam’s shrimp and other seafood products to take advantage of post-pandemic. Many seafood products are expected to have higher growth in the EU when the EU-Việt Nam Free Trade Agreement (EVFTA) is expected to take effect in the middle of the year as most shrimp materials would be reduced to from 12-20 per cent to zero tax. Imported tax for processed shrimp will also be lowered to zero after seven years. Meanwhile, tra fish will enjoy an import tax of zero after three years. The US, the second biggest importer of Vietnamese shrimp, is expected to have high demand. VASEP recommends local businesses focus on processed products with high added value as well as changing packaging process to suit the retail segment. In addition, if the COVID-19 pandemic is basically resolved by the end of the second quarter and the world market reopens, Vietnamese shrimp can take advantage of opportunities. Shrimp exports tend to be better when import and consumption demand increase, making export prices recover. VASEP forecasts that shrimp export value could recover and even increase by 3-4 per cent compared to 2019, reaching US$3.45-3.5 billion. For seafood products, the 35 per cent reduction in oil prices compared to the end of 2019 has led fishermen to ramp up their activities. However, some seafood products, especially tuna, are still in short supply due to difficulties in importing raw materials due to the COVID-19 outbreak. Many businesses still receive orders for canned tuna but lack the raw materials for export processing. VASEP predicted that seafood demand in China, South Korea and Japan would be reduced while the canned segment would increase. Firms should focus on canned seafood products with suitable prices to meet increasing demand from markets affected by the pandemic, the body said. However, due to the impact of social distancing and the shortage of domestic raw materials, it will be difficult for seafood enterprises to increase exports in the second and third quarters this year. Trần Đình Luân, General Director of the General Department of Fisheries, said the industry would work with localities to improve breeds’ quality by intensifying inspection on conditions and granting certificates for establishments producing aquatic breeds. It will also supervise to ensure food safety and build an electronic traceability system for production, processing and export chains. The Ministry of Agriculture and Rural Development (MARD) recommended seafood processors continue to diversify frozen products and increase exports to markets which are being affected by COVID-19. Phùng Đức Tiến, MARD’s deputy minister said they had asked management agencies and associations to have plans to meet with increasing demand post-pandemic. VNS |
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BUSINESS NEWS HEADLINES JUNE 401:07Hanoi to turn Hoa Lac into sci-tech hub The Hoa Lac new urban area on the outskirts of Hanoi will become a science and technology urban center as Vietnam seeks to advance its economy and reduce population density pressure on the downtown of the capital city. Hoa Lac urban area will become a driving force for socio-economic development of rural districts. According to the latest general planning for 2025 approved by the prime minister, with a surface of over 17,000 ha, Hoa Lac township comprises areas of two districts of Quoc Oai and Thach That, and Son Tay town. It is planned to be a modern urban area with uniform social and technical infrastructure and a driving force for socio-economic development of rural districts. The township is expected to focus on developing modern technologies, training high-quality human resources; researching science and high technology for the whole country. It will become a center of national universities and vocational colleges; medical center, among other purposes. The place will also become an eco-urban area which would be a green, smart, energy-saving urban center to the west of Hanoi. Hoa Lac will be divided into two specific zones: urban development zone and green zone. The urban development zone includes Hoa Lac Hi-Tech Park (1,600 hectares), Hanoi National University (1,000ha) and Dong Xuan - Tien Xuan new urban area (1,250ha). The green zone will surround the inner city, which is delimited by urban ring roads, including the agricultural area in west of the Tich river, Vietnam Mountain Forest Ecoregion, Hoa Lac airport area connecting with Dong Mo Lake and the Ba Vi National Park. The population of the Hoa Lac urban area is estimated at about 150,000 by 2025 and 600,000 by 2030. Monthly CPI falls to lowest in five years According to the General Statistics Office, the CPI in May decreased by 0.03 per cent compared to April, down 1.24 per cent from last December, the lowest level since 2016. However, the average CPI of the first five months of this year still increased by 4.39 per cent over the same period in 2019. The office said inflation was controlled in May even when pork prices were increasing. This was thanks to the Government’s synchronous implementation of support policies for local businesses and people during the COVID-19 pandemic. It was also helped by an initiative to control petrol prices and the proactive monetary policy of Vietnam./. Malaysia seeks to reinvigorate tourism industry amidst COVID-19 Malaysia could set up travel bubble with other ASEAN nations such as Singapore, Vietnam and Thailand, said Zaidi Isham Ismail in a recent article posted on New Straits Times. The writer explained that the bubble or corridors denotes a safe or a protected perimeter between two travel destinations or countries or states already declared as green zones ready to receive tourists which is set to help the tourism sector recover. In Malaysia, he said, the obvious and nearest travel bubble is with Singapore. “Perhaps the two countries could consider setting up their very own travel bubble”, he said. Subsequently, this concept could be expanded to the rest of ASEAN such as Vietnam and Thailand which are also headed towards green zone status, he added. The essential requirement of implementing this initiative is trust between countries and cooperation of multi agencies, according to the writer./. Viet Nam’s agricultural exports decline in May due to COVID-19 Exports and imports of agricultural goods saw a decline in the first five months of 2020 due to the negative impacts of the COVID-19 pandemic, according to the Ministry of Agriculture and Rural Development (MARD)’s monthly report last week. Export value in the first five months of 2020 saw a decline of 4.1 per cent year-on-year and was valued at US$15.5 billion. Coffee, rice and vegetables were among the commodities with the strongest export growth, whereas rubber, tea and pepper saw a sharp fall. China is Việt Nam’s largest exporting market of agricultural products, with export turnover at $3.7 billion, a 15.5 per cent drop in value, closely followed by the US and the EU, reaching $3.4 billion and $1.6 billion, respectively. Nguyễn Quốc Toản, Director of the MARD’s Agro Processing and Market Development Department, says the ministry will closely observe the situation in COVID-19-affected markets to provide corresponding solutions. “We will collaborate with the Ministry of Industry and Trade, agencies and companies to closely monitor the price, supply and demand of essential agricultural goods in the domestic market to ensure food security in Việt Nam while still maintaining agricultural exports,” he said. The ministry will also focus on resolving technical barriers in agricultural trade, as well as expanding and diversifying markets through negotiations with trade partners. Effects of COVID-19 see industrial production plummet The opening five months of the year have seen the Index of Industrial Production (IIP) grow annually by approximately 1%, the slowest pace recorded in many years due to the negative impacted caused by the novel coronavirus (COVID-19), according to the General Statistics Office (GSO). With the epidemic being successfully brought under control, the entire nation has entered a period where it is simultaneously both combating the epidemic and making every effort to revitalise the national economy with plenty of positive signs ahead with regard to industrial production activities. In line with this positivity, the IIP surged by 11.2% in May in comparison with the previous month, despite suffering a 3.1% decrease in comparison with the same period from 2019. Indeed, the past five months have seen the IIP grow by an estimated annual amount of 1%, much lower than the 9.5% increase seen during the same period from last year. Most notably, the processing and manufacturing sector increased by 2.2%, contributing 2% to the general increase, while electricity production and distribution rose by 2.6%, therefore contributing 0.2%. In contrast, the mining industry dropped by 8.1%, leading to a 1.3% fall in the overall increase. The GSO stated that the complex developments of the COVID-19 pandemic globally have led to a shortage of input materials, subsequently hitting industrial production. Other key products that have followed this downward trend are beer, down 24.5%, automobiles, down 26.9%, motorbikes, down 15.6%, crude oil, down 13.7%, and liquefied petroleum gas, down 11.8%. Elsewhere, some industries are still recording fair growth such as phone components, monosodium glutamate MSG, and steel. The number of employees working in industrial enterprises as of May 1 grew by 0.9% from the previous month, a 1.7% decrease on-year, of which employees at state-owned enterprises fell by 1.9%, with non-state enterprises falling by 2.5%, and FDI enterprises by 1.3%. Air corridors could offer pathway to rejuvenate national tourism industry The New Straits Times recently published an article by author Zaidi Isham Ismail discussing the prospect of restoring Malaysia's tourism industry amid the COVID-19 pandemic. Notably, the author said that Malaysia could apply the form of "air travel" with ASEAN member states such as Singapore, Vietnam and Thailand in the near future. Without a doubt, COVID-19 had unleashed havoc all over the world and one of the worst affected sectors is the tourism and travel industry. However, a beacon of light had possibly shone on the industry with the advent of the travel "bubble." Some call it "travel corridors" while others name it "air bridges." The bubble or corridors denotes a safe or a protected perimeter between two travel destinations or countries or states already declared as green zones ready to receive tourists which is set to help the tourism sector recover. Already there are bubbles being mooted between Australia and New Zealand and between South Korea and 10 territories in China, the article said. Perhaps in Malaysia, the obvious and nearest travel bubble is with Singapore. Granted the situation in Singapore is extremely volatile right now but it only involves foreign workers while the rest of the population are relatively COVID-19 free. According to the author, perhaps the two countries could consider setting up their very own travel bubble. Subsequently, this concept could be expanded to the rest of ASEAN such as Vietnam and Thailand which are also headed towards green zone status. But will this travel bubble concept work? Ultimately for the initiative to work, the essential requirement is trust between countries. Safe travel corridors also require the cooperation of multi agencies. This includes the health ministries of both nations, the immigration, customs, airport authorities and the tourists themselves who must be honest in their health status backed by health certificates. Everybody must practise the standard operating procedures such as the social distancing, hand sanitisers and face masks. Participating partners must also have a standard operating procedures between them involving hotels, restaurants and tourism spots. The economies of nations are fledgling and the prospect of a COVID-19 vaccine is still far away, the author added. Vietnam Airlines gears up to open six new domestic routes National flag carrier Vietnam Airlines are poised to open six new domestic air routes throughout June, according to a representative from the airline on June 1. In line with the move, the Hai Phong-Da Lat and Hai Phong-Phu Quoc air routes will begin operation from June 12, with four round trips per week being held on Monday, Wednesday, Friday, and Sunday. Elsewhere, air routes such as Hai Phong-Can Tho, Hai Phong-Buon Ma Thuot, and Vinh-Can Tho will start as of June 12 at a frequency of three round trips per week on Tuesday, Thursday, and Saturday. The Can Tho-Buon Ma Thuot route will operate with a frequency of four return flights per week on Monday, Tuesday, Thursday, and Saturday, beginning from June 22. The Vietnam Airlines representative stated that in order to mark the opening of a new route, the firm will be selling 6,666 air tickets at a price of only VND 66,000 for a one-way trip, excluding taxes and fees. Tickets will go on sale from June 6 to June 12 with departures lasting until December 31. Moreover, passengers will also be able to purchase special promotional tickets at a price of only VND99,000 for a one-way trip, excluding taxes and fees, with ticket validity and departure until July 31. This move comes following Vietnam Airlines opening five new domestic routes during May, including Ho Chi Minh City-Tuy Hoa, Hai Phong-Nha Trang, Vinh-Da Lat, Vinh-Buon Ma Thuot, and Thanh Hoa-Buon Ma Thuot. In an effort to ensure the safety of passengers and the wider community, Vietnam Airlines will be maintaining preventive measures against the novel coronavirus in line with regulations. Stimulus packages boost local consumption and tourism Ho Chi Minh City has recently completed a range of plans in order to deploy a series of stimulus schemes aimed at reviving the tourism industry and increasing local consumption in order to negate the negative impacted of the COVID-19 pandemic. In line with the plans, the Ho Chi Minh City Department of Industry and Trade will be hosting a scheme aimed at stimulating consumption demand, with the event taking place from July 2-5 at 19 Dao Trinh Nhat street in Thu Duc district. The programme aims to strengthen connectivity between various production units and distributors whilst simultaneously showcasing the southern city’s key export products across 500 stalls at the event. Moreover, participating businesses will also be given the chance to launch an array of discount schemes aimed at promoting sales and establishing supply chains in an effort to support the introduction of agricultural products to distribution systems throughout the southern metropolis. The Ho Chi Minh City Department of Industry and Trade hosted a press conference to unveil its plans to run a 60 golden-day programme which is scheduled to take place between June 1 and July 30. The event will be part of the southern city’s trade promotion scheme for the year and aims to remove various difficulties that businesses may be facing following the impact of the COVID-19, while also helping to stimulate domestic consumption, along with restoring production and business activities in the post-pandemic period. During the event, a range of businesses are expected to put on several diverse promotional activities, with a maximum discount on the value of goods and services reaching up to 100%. Nguyen Phuong Dong, Deputy Director of Ho Chi Minh City Department of Industry and Trade, said the programme is anticipated to offer an ideal venue for firms to introduce their new products. Furthermore, it will also contribute to accelerating the city’s economic growth in the post-pandemic period, whilst offering firms a platform to join hands in order to carry out the action plan of "Vietnamese people prioritise using Vietnamese goods”. Disbursement of investment capital from State budget rises sharply in May Approximately VND31.1 trillion (US$1.33 billion) in investment capital sourced from the State budget was disbursed in May 2020, an increase of 17.5% over the same period in 2019, according to the General Statistics Office. In the January-May period, total investment capital from the State budget was estimated at VND116.3 trillion (US$4.99 billion), equivalent to 24.9% of the year’s target and up 15.6% over the same period last year. The disbursement rate of investment capital from the State budget in May and in the first five months of this year reached the highest levels in the 2016-2020 period. The investment capital has soared sharply in the context that the COVID-19 pandemic has been well under control while investment in basic construction has returned to normal and the progress of major construction projects is being accelerated. Landmark Holding to be delisted from HSX over financial troubles Developer Landmark Holding is neck-deep in financial troubles and is plagued by uncertainties around its notorious Manhattan Tower project which has been delayed for almost 10 years now – and has drawn lawsuits from hundreds of homebuyers. Landmark Holding JSC (code: LMH), formerly known as Thang Long International JSC specialising in petrochemical products and real estate, has just sent its unaudited financial statement for 2019 to the Ho Chi Minh City Stock Exchange (HSX). However, Viet Values Audit and Consulting Co., Ltd. refused to confirm the accuracy of items in the statement, including VND53.5 billion($2.3 million) in short-term revenue from clients, VND214.3 billion ($9.3 million) in advance payments to vendors, VND20.7 billion ($0.9 million) in short-term receivables, and VND134.8 billion ($5.8 million) in advance payment from buyers, among others. The accuracy of these items will impact other items in the accounting balance sheet and business results. Additionally, Viet Values highlighted that there is no contract to prove the accuracy of VND136.4 billion ($5.9 million) in receivables and VND31.1 billion ($1.3 million) in the balance of Landmark Holding (as of the end of 2019), which are unsecured loans without any collaterals or guarantee commitment of a third party. Notably, these questionable items have existed in the financial statement 2018 with bigger amounts. Thus, if these items in the unaudited financial statement of Landmark Holding are not made-up, the heads of the company should be able to explain or make a comment after the refusal of Viet Values, to set investors and shareholders’ mind at rest, as well as change the audit firm's decision. However, so far the company has remained, and LMH is being forced to delist its stock. In fact, business results in the fourth quarter and the whole of 2019 of Landmark Holding were quite a lot worse than in the previous year. At the end of 2019, the LMH stock dropped for the 25th consecutive session to VND2,000 (8 US cents) from VND12,200 (53 US cents) last December. Moreover, the company's first-quarter business results showed that revenue was much less than its expenses, resulting in a VND7 billion ($304,000) loss. Landmark Holding was listed on HSX in October 2018 with 23 million shares initially, which was raised to 25.6 million since then. However, over the last 19 months, the internal shareholders of the company purchased 4.1 million shares only and sold approximately 7.6 million ones. Besides, numerous big shareholders have also divested their holdings in LMH significantly, like Nguyen Thanh Tung, Luong Quan Vinh, and Tran Thanh Tung. This confirmed their lack of faith in LMH’s financial status. In addition to financial troubles, hundreds of homebuyers who paid a lot of money to buy apartments of at Tower (21 Le Van Luong, Hanoi’s Thanh Xuan district), are dogging Landmark Holding for a refund, while the owner of the project – Ba Dinh Construction Consultancy-Investment JSC (Ba Dinh JSC) – has been sued by Global Petroleum Commercial Bank (GPBank) to recover the loans of VND290 billion ($12.6 million) (as of April 2019 only). Entering the real estate sector several years ago, Landmark Holding seems unable to spot reputable and reliable projects and partners, which contributed to its present catastrophic business results. If it cannot quickly resolve and overcome these financial difficulties, the developer could very well go bankrupt, leaving investors, homebuyers, and shareholders empty-handed. SK Group acquires 25 per cent of Imexpharm South Korean conglomerate SK Group has become a large shareholder of Imexpharm (IMP), adding to its considerable portfolio of shares in Vingroup, Masan, and PV Oil. On May 29, SK Investment III, a subsidiary of South Korea’s third-largest conglomerate SK Group, received 12.32 million shares, equivalent to 24.9 per cent of Imexpharm Corporation (code: IMP). The transaction was carried out through Vietnam Securities Depository (VSD) at an undisclosed value. However, at the end of last week, the price of IMP shares was around VND54,000 ($2.35), so if the transaction was made at market price, it would be around VND665 billion ($28.9 million). Most of the shares (11.3 million) were acquired from Dragon Capital Group, while the rest came from CAM Vietnam Mother Fund, Kingsmead, and Mirae Asset. The latest investment is quite modest compared to the two previous transactions where SK Investment Vina I spent $470 million on 9.4 per cent of Masan Group, and SK Investment Vina II poured $1 billion into acquiring 6 per cent of Vingroup. Additionally, another SK Group subsidiary, SK Energy, also holds 5.2 per cent of PV Oil. At Imexpharm, foreign investors now hold approximately 49 per cent of the total shares. Other big shareholders are VinaCapital (7 per cent), KWE Beteiligungen AG (14.3 per cent), and Vietnam Pharmaceutical JSC – Vinapharm (22.9 per cent). At present, numerous big pharmaceutical firms have raised their foreign ownership limits to 49 per cent, enabling foreign companies to raise ownership, the way Taisho Pharmaceutical boosted its interest in DHG Pharmaceutical JSC (DHG) to 51 per cent, Abbot in Domesco Medical Import-Export JSC (DMC) to 51.7 per cent, or Stada in Pymepharco (PME) to 62 per cent. Life Lab and eDoctor sign strategic partnership SDG Life (Life Lab) and eDoctor have signed a strategic partnership, marking the beginning of a fruitful, long-term co-operation. Accordingly, Life Lab has become an official partner of eDoctor in doing medical tests for the latter’s customers, and will also act as a consultant for eDoctor in developing new healthcare products and services packages. Duong Ngoc Cuong, general director of Life Lab, said that, “With the two sides’ capacity and growth potential, the co-operation will produce fruitful results. It will bring good healthcare services for customers.” Established in 2019, Life Lab is a high-tech and professional testing centre. Meanwhile, Vietnam-based eDoctor is a mobile app where millions of Vietnamese people can easily access healthcare information and connect with doctors, hospitals, and pharmacies. Soya Garden chain closes most stores in Ho Chi Minh City Half of Soya Garden shops in Ho Chi Minh City have been closed after the pandemic, while the remainder only see a handful of customers a day. Recently, Soya Garden is said to have closed most of its shops in Ho Chi Minh City to stop losing and keep only three at golden land plots with enough customers to operate. In fact, 10 of the 13 Soya Garden shops located in suburban districts have been closed. Elsewhere, others are still open, including the flagship one on District 1's Ly Tu Trong Street, the one on Tan Binh district's Le Van Sy Street, and the one on Binh Thanh district's Vu Huy Tan Street, while the one on Nguyen Dinh Chieu (also the representative office of Soya in Ho Chi Minh City) is open without serving. Six of the shops closed are at 35 Phan Dang Luu Street (the first Soya Garden store in the city), three ones in Go Vap district, and two ones in Tan Binh and Tan Phu districts. Moreover, on Facebook, a friend of Hoang Anh Tuan, the CEO of this chain, is offering to lease the house at 27B Nguyen Dinh Chieu Street, District 1, where the first floor is home to a Soya Garden, above which is the headquarters of the chain. Meanwhile, the fan page of Soya Garden has stopped posting anything since May 11, and its website has been closed all of a sudden. Soya Garden has also been shutting down stores in Hanoi. Some owners of franchised shops in Hanoi are offering to transfer their stores. At the end of January, Soya Garden announced having 45 shops including 29 in Hanoi, 13 in Ho Chi Minh City, two in Haiphong, and one in Nha Trang. In last September, the chain inaugurated the 50th store at District 1's Ly Tu Trong Street. This means the chain closed five shops in the few months ending 2019. After calling for investment on the TV show Shark Tank 2018, Soya Garden received a total of VND100 billion ($4.35 million) from EGroup of Shark Nguyen Ngoc Thuy – chairman of Apax Holdings JSC and EGroup – and has massively expanded for the last two years. The CEO of Soya Garden originally targeted having 100 stores in 2019 and 300 ones in 2020 and setting foot in South Korea, Thailand, and Japan in the next years to make Soya Garden drinks as popular as coffee or bubble tea, which has come to naught after the global health crisis. January-May foreign investment inflows reach $13.9 billion, promising strong rebound Although the total foreign investment capital in the first five months of this year reported a decrease of 17 per cent on-year, however, capital inflows are expected to increase once again thanks to drastic government measures to grab opportunities from the global wave of investment relocation. According to statistics published by the Foreign Investment Agency (FIA) under the Ministry of Planning and Investment, foreign investors poured $13.89 billion in total into Vietnam during January-May, signifying a decrease of 17 per cent on-year due to the impact of the COVID-19 pandemic. The period saw 1,212 newly-registered projects with a total registered capital of $7.44 billion, down 11.1 per cent in the number of projects but up 15.2 per cent in capital value. Meanwhile, 436 existing projects were allowed to raise investment by more than $3.45 billion, up 31.4 per cent on-year. According to the agency, foreign-invested capital disbursement reached $6.7 billion in the five months, equivalent to 91.8 per cent of last year’s corresponding period. Foreign investors pledged to pour capital into 18 sectors, in which manufacturing and processing took the lead with nearly $6.87 billion, accounting for 73.6 per cent of the total capital. It was followed by power production and distribution ($3.92 billion); real estate ($800 million); and wholesale and retail ($776 million). Among the 54 localities receiving foreign investment in the period, the southern province of Bac Lieu ranked at the top with $4 billion. The southern province of Ba Ria-Vung Tau came second with $1.93 billion and Ho Chi Minh City placed third with $1.6 billion. Singapore is still the largest foreign investor of Vietnam with the total capital of $5.3 billion, followed by Thailand with $1.46 billion, China with $1.27 billion, and Japan with $1.26 billion. At a recent meeting hosted by the prime minister, the representatives of the Ministry of Planning and Investment (MPI) and localities shared that after studying investment opportunities in the country, foreign investors found Vietnam a safe and promising investment destination and a likely candidate for their diversification of supply sources. The PM also agreed to establish a special working group headed by the Minister of Planning and Investment to catch this wave of new investment. The special working group was established to build competitive investment attraction policies to tap into the wave of investment going into this global strategic relocation. The policies to be created include incentives on tariffs, access to land, as well as solutions to prevent further disruptions to the supply chain and a lack of human resources. In addition, as a key priority for investors is stability and legal consistency, the special working group will complete the relevant legal framework. PV Power to take a dive into solar power PV Power plans to establish a member company to set foot in the renewable energy sector. At first, the group will construct rooftop solar power systems on the buildings and factories in the holding of PetroVietnam. According to the representative of PV Power, the company has distinct advantages due to its experience in management, operation, as well as partner relationship with EVN. Besides, the company has the available infrastructure to help connectivity. In the first year, the firm expects to generate 50MW of solar power. Although this figure is rather small compared to other projects in the power industry, however, with its advantages in infrastructure and human resources, numerous businesses expressed intentions to co-operate with PV Power. According to PV Power's recently published business statement, its net revenue in the first quarter decreased by 6 per cent to VND7.97 trillion ($346.5 million) and its after-tax profit saw a plunge by 45 per cent to VND505 billion ($21.96 million). The company said that this bleak result is still within its plans and was mainly due to a plunge in the capacity of its two hydropower plants. Besides, it has yet to add the profit from Nhon Trach 2 thermal power plant. Regarding other projects invested by PV Power, Nhon Trach 1 thermal power plant has seen decreasing gas sources and PV Gas plans to take gas from Sao Vang Dai Nguyet field to offset the lack. Besides, PV Power is considering using liquefied natural gas (LNG) as an alternative. In addition, PV Power completed the feasibility study for the implementation of large-scale projects, including Nhon Trach 3 and 4 thermal power plants, and has mobilised capital to develop projects located in Ong Keo Industrial Zone in the southern province of Dong Nai. According to information published by PV Power, the consultancy agency of Nhon Trach 3 and 4 – Power Engineering Consulting JSC 2 – completed the feasibility study. PV Power will submit the basic report to the Ministry of Industry and Trade for approval and send a document to EVN to discuss grid connection. Besides, the company will work with Electric Power Trading Company and PV Gas to negotiate power and gas purchase agreements for the two projects. Regarding the investment capital, along with loans from banks and credit funds, as well as equity, PV Power announced that the Thai investor B.Grimm Power expressed intention to invest in these two projects, as part of their MoU on investment co-operation. Việt Nam’s agricultural exports decline in May due to COVID-19 Exports and imports of agricultural goods saw a decline in the first five months of 2020 due to the negative impacts of the COVID-19 pandemic, according to the Ministry of Agriculture and Rural Development (MARD)’s monthly report last week. Export value in the first five months of 2020 saw a decline of 4.1 per cent year-on-year and was valued at US$15.5 billion. Coffee, rice and vegetables were among the commodities with the strongest export growth, whereas rubber, tea and pepper saw a sharp fall. China is Việt Nam’s largest exporting market of agricultural products, with export turnover at $3.7 billion, a 15.5 per cent drop in value, closely followed by the US and the EU, reaching $3.4 billion and $1.6 billion, respectively. Nguyễn Quốc Toản, Director of the MARD’s Agro Processing and Market Development Department, says the ministry will closely observe the situation in COVID-19-affected markets to provide corresponding solutions. “We will collaborate with the Ministry of Industry and Trade, agencies and companies to closely monitor the price, supply and demand of essential agricultural goods in the domestic market to ensure food security in Việt Nam while still maintaining agricultural exports,” he said. The ministry will also focus on resolving technical barriers in agricultural trade, as well as expanding and diversifying markets through negotiations with trade partners. Foreign investors eye moving production bases to Thailand Many foreign investors are looking to move their production base to Thailand, according to Kriangkrai Thianukul, vice president of the Federation of Thai Industries (FTI). The main reason for their interest in Thailand is the COVID-19 pandemic, which caused manufacturing facilities in China to shut down and affected the supply chain of the industrial sector, he said. Many companies are planning to move out of China to reduce future risk and are eyeing countries in Southeast Asia, he added. He further noted that Thailand is among the top choices as the country has several seaports to facilitate logistics and the geographical location is at the centre of the region. Thailand also has basic infrastructure for high-tech industries as well as cheap labour, he said. The fact that Thailand has handled the pandemic well also proves its ability in dealing with a crisis and helps strengthen investors’ confidence, he explained. As Asian supply chains reshuffle in the wake of the pandemic, the Thai government is focusing its efforts to attract foreign investors in the medical devices sector, a promising industry in light of the health crisis. Thailand’s Board of Investment (BoI) aims to set up joint ventures or convince foreign firms to move their manufacturing base for medical devices to the country. Sonklin Ploymee, executive director of industrial linkage development at BoI, said the group is focusing on developing the country's subcontracting sector to serve new targeted industries in the future. Initially, the BoI will focus on the aerospace, medical devices, electric vehicle, smart electronics and the railway system sectors, she said. The division has successfully conducted several programmes to assist foreign assemblers and manufacturers with sourcing high-quality parts and components from Thai small and medium-sized enterprises. The BoI plans to hold Subcon Thailand, ASEAN's largest international industrial subcontracting event, between September 23 – 26 in Bangkok to facilitate business matching and create a targeted 12 billion THB (nearly 400 million USD) in value from 8,000 business matches./. Thai rice exports facing price disadvantage The price of Thai rice is higher than that of competitors due to limited supply and the strengthening of the baht, which could hurt exports, the Thai Rice Exporters Association (TREA) said. TREA President Charoen Laothammathat cited data of the Customs Department that the country exported 2.11 million tonnes of rice worth 43 billion baht (1.38 billion USD), down 32.1 percent and 15.7 percent year-on-year respectively during the first four months of 2020. The figure during the first four months of 2019 was 3.1 million tonnes worth 51 billion baht. In April alone, Thailand exported 643,852 tonnes of rice, earning 14.55 billion baht, up 23.7 percent and 32.7 percent respectively compared to the previous month as countries in America, Africa and Asia imported more rice due to uncertainty following the COVID-19 outbreak. The association expected the export of rice in May to drop to approximately 500,000 tonnes, as rice importing countries were delaying orders, while competitors Vietnam, India and Pakistan had returned to the market. In addition, the price of Thai rice was higher than that of competitors due to limited supply and strengthening of the baht, he noted. He explained that the price of 5 percent white rice in Thailand was 501 USD per tonne, higher than that of competitors by 30 USD to 130 USD. In 2019, Thailand shipped 7.58 million tonnes of rice abroad, raking in 131 billion baht (over 4 billion USD), down 32 percent in volume and 25 percent in value compared to the previous year./. THACO exports first semi-trailers to US Truong Hai Auto Corporation, known as THACO, exported its first 36 semi-trailers to the US on June 1. In order to make its inroads into the US market, THACO has conducted surveys and signed a memorandum of understanding on distributing semi-trailers in the US market with PITTS Enterprises Company - one of 15 major semi-trailers manufacturers in North America. Under the contract, these 36 semi-trailers are the first of the 69-unit batch that will be exported to the US through PITTS Enterprises. According to THACO, the semi-trailers are manufactured at THACO Special Vehicles Manufacturing Limited Company, the firm that specialises in manufacturing high-quality semi-trailers and special vehicles for local and foreign markets. In the coming time, PITTS Enterprises will continue to cooperate with THACO to design, develop and manufacture new products to meet the demand of customers and expand the distribution in the US market. THACO said it will hand over the remaining 33 semi-trailers to PITTS Enterprises in late June, and continue to fulfill its production commitment signed by the two sides in 2020. It will also boost exports to Japan, Australia and ASEAN countries. The firm expects to export more than 1,600 vehicles of all kinds with a total value of 50 million USD this year. Its successful export to the US market proves that THACO has appropriate strategies to join deeper in the global value chain./. Indonesia to offer nine toll road projects in 2020 The Indonesian Ministry of Public Works and Housing (PUPR) said it will offer nine toll road projects during 2020. Minister Basuki Hadimuljono said this year, the Indonesian government prepared an investment of 395 trillion Rp (26.33 billion USD) for toll road projects across the archipelago. “Although the finance ministry saved a budget of 44 trillion Rp, no activities were canceled,” he told reporters through a virtual press conference after a limited Cabinet meeting on the National Strategic Projects led by President Joko Widodo on May 28. Hadimuljono reported that some of the toll roads will be inaugurated this year, including Banda Aceh – Sigli with a length of 14 kilometers (km), Pekanbaru – Dumai 131 km, Manado 21 km, and Balikpapan – Samarinda 33 km. Then, part of Makassar toll road, Cibitung – Cilincing, and Kriyan toll road in East Java will be opened at the end of the year. The head of Indonesia’ Toll Road Regulatory Agency, Danang Parikesit, added that six of the nine projects to be auctioned were proposals or initiatives from business entities. They will have a total investment of 135.60 trillion Rp and a total length of over 461km. The Indonesian government set a target of building 3,000 km of new toll roads across the country in the next five years. President Joko Widodo said during his first term, the country has build 720 km of toll roads. “In the next five years, we hope that we already have 5,000 km of toll roads. Therefore, we are still focusing on infrastructure development in addition to human resource development,“ he stated not long ago./. Good funding urged for appraisal of North-South express railway’s pre-feasibility study Deputy Prime Minister Trinh Dinh Dung has ordered relevant ministries to allocate sufficient funding for the appraisal of the pre-feasibility study of the North-South high-speed railway project. The Ministry of Transport was tasked to promptly work with the Ministry of Planning and Investment and the Ministry of Finance to provide adequate funding for the assessment of the study in accordance with regulations. The study is being assessed by a state appraisal council exclusively set up for the project last year. The Ministry of Transport’s Party Civil Affairs Committee was requested to set a timeline for the submission of a plan on construction of the North-South high-speed railway to the Politburo, which should be reported to the Prime Minister before June 10. The railway is designed to have a total length of about 1,560 km, running along the North-South corridor through 20 cities and provinces to connect Hanoi and Ho Chi Minh City. Of the total, the 14-km section in Hanoi shares the infrastructure with the Hanoi urban railway No.1 (from Hanoi station to Ngoc Hoi station), and the remaining connects Ngoc Hoi station to Thu Thiem station, with 27 stations, five depots, and 42 infrastructure maintenance facilities. It is designed for passenger trains to run with a maximum speed of 350km per hour. The first phase of the project has a total investment of 561.6 trillion VND (about 24.71 billion USD), while the second costs 772.6 trillion VND. The whole project is scheduled to be completed in 2050./. Agricultural imports, exports fall due to COVID-19 Exports and imports of agricultural goods saw a decline in the first five months of 2020 due to the negative impacts of the COVID-19 pandemic, according to the Ministry of Agriculture and Rural Development (MARD)’s monthly report last week. Of which, export value in the period dropped 4.1 percent year-on-year to 15.5 billion USD. Coffee, rice and vegetables were among the commodities with the strongest export growth, whereas rubber, tea and pepper saw a sharp fall. China is Vietnam’s largest exporting market of agricultural products, with export turnover of 3.7 billion USD, a 15.5 percent drop in value. It was closely followed by the US and the EU, reaching 3.4 billion USD and 1.6 billion USD, respectively. Nguyen Quoc Toan, Director of the MARD’s Agro Processing and Market Development Department, says the ministry will closely observe the situation in COVID-19-affected markets to provide corresponding solutions. “We will collaborate with the Ministry of Industry and Trade, agencies and companies to closely monitor the price, supply and demand of essential agricultural goods in the domestic market to ensure food security in Vietnam while still maintaining agricultural exports,” he said. The ministry will also focus on resolving technical barriers in agricultural trade, as well as expanding and diversifying markets through negotiations with trade partners./. Workshop looks into bottlenecks in post-COVID-19 development The Central Institute for Economic Management (CIEM) held a workshop in Hanoi on June 1 to look into bottlenecks in Vietnam’s development post-COVID-19. CIEM Director Tran Thi Hong Minh said Vietnam’s economy was greatly affected by the coronavirus outbreak in the opening months of 2020. The country has, however, basically brought the pandemic under control and has now begun its economic recovery. Now is the time to focus on bottlenecks in economic development to identify solutions, she said, noting that such bottlenecks existed prior to COVID-19 breaking out. Nguyen Anh Duong, head of the CIEM’s division for macro-economy, said international organisations have downgraded global growth projections, including for Vietnam. Many forecast that the pandemic’s impact on the global economy could be even more serious than that of the global financial crisis and may linger for some time. He noted that Vietnam’s economic growth slowed in the first quarter compared to the same period in 2010-2019. Exports and the trade balance remained positive in the opening months but will be hard to maintain after April. Efforts by domestic businesses are not sufficient in the current context, and it is necessary to adopt a friendly approach to FDI, he believes. Looking at bottlenecks in post-COVID-19 development, Duong pointed to those that are relevant to institutional quality, e-Government building, the use of public resources, and inclusive and sustainable growth. He stressed matters relating to the treatment of investors, noting that they are not simply eliminating unnecessary procedures. To effectively channel FDI into targeted sectors, Vietnam must issue standards on investment attraction. Meanwhile, Dau Anh Tuan, Head of the Legal Department at the Vietnam Chamber of Commerce and Industry (VCCI), underlined the need to push ahead with substantive administrative reform. He said the country has made great strides forward in administrative reform but has also encountered more difficulties, such as in dispute settlement and asset protection. Reform must therefore be carried out more firmly and in a way that creates optimal conditions for businesses and does not simply tackle the difficulties they face./. Vietnam has ‘golden opportunity’ to reactivate economy: official Vietnam now has a “golden opportunity” to reactivate its economy earlier than many other countries, Minister-Chairman of the Government Office Mai Tien Dung said on June 2. At the Government’s regular press conference in Hanoi, he cited the Government’s assessment that there were many bright spots in the economy over the last five months. Exports declined, but not strongly compared to the same period last year, and a trade surplus of 1.9 billion USD was still recorded. Only tourism revenue and the number of international arrivals experienced sharp falls. The macro-economy remains stable, the monetary policy stays flexible while the attraction of foreign capital along with businesses and people’s absorption of capital have also proved effective, Dung noted. He highlighted the Government’s viewpoint that ministries and sectors must push ahead with the COVID-19 fight and adamantly prevent the return of this pandemic so as to focus every resource on production recovery and economic development. The official also quoted the Ministry of Planning and Investment as reporting that 5,056 businesses resumed operations in May, up 32.7 percent month on month. Total retail sales of goods and service revenue also grew 26.9 percent from April, the index of industrial production (IIP) 11.2 percent, and exports 5.2 percent. These figures showed the economy has begun to return to normal after the social distancing period, he said. However, the minister noted, the report also pointed out that big difficulties still lie ahead. Revenue from trading activities and services last month soared by 26.9 percent against April but dropped 4.8 percent year on year. The five-month retail sales of goods and service revenue shrank 3.9 percent from the same period of 2019. Meanwhile, the IIP in May still fell 3.1 percent from a year earlier, and the five-month figure rose by only 1 percent year on year – the slowest pace in many years. According to the General Statistics Office, as the COVID-19 situation remains complex around the world, supply chains of input materials will continue to be interrupted, and so will industrial production./. Vietnam-China trade conference focuses on building materials, décor An online trade conference between Vietnam and China was held in Hanoi on June 2, focusing on construction materials and interior and exterior décor. Head of the Trade Promotion Agency Vu Ba Phu said this was the second conference jointly held by the Agency and the Department of Commerce in China’s Guangxi Zhuang Autonomous Region (GZAR) over the past two months, as part of a trade promotion agreement signed by the two offices and 10 northern Vietnamese localities in June 2019. The conference aimed to realise a common view held by Minister of Industry and Trade Tran Tuan Anh and Secretary of the GZAR’s Party Committee Lu Xishe on intensifying measures and cooperation between Guangxi and Vietnamese localities to resume trade and economic activities. The production and trade of construction materials and interior and exterior décor depend very much on the real estate market. Real estate in both Vietnam and China, however, has been downbeat since virtually the beginning of the year, especially since COVID-19 broke out. Enterprises in the two countries operating in the field should therefore intensify their cooperation and adopt methodical investment strategies on finance and technology to anticipate new opportunities when the pandemic is defeated. Jiang Liansheng, Director of the GZAR’s Department of Commerce, said the two sides have organised numerous fairs on construction materials and interior and exterior décor. Two-way trade of household appliances, building materials, décor, and sanitary equipment rose from 24.78 billion USD in 2017 to 39.73 billion USD in 2019, of which turnover of building materials and décor increased from 7.16 billion USD to 14.76 billion USD, for average annual growth of 53.1 percent. Phu stressed that his agency is willing to facilitate links between enterprises from Vietnam and Guangxi./. VNN |
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Vietnam aims to become a digital society by 2030 02:00 Prime Minister Nguyen Xuan Phuc has approved to a national digital transformation programme that will run until 2025, with a vision extending to 2030, which sets a target of turning the country into a stable and prosperous digital country over the course of the next decade.  Vietnam is set to become a digital country by 2030 (Photo: internet) Under the scheme, Vietnam will experiment a range of new technologies and models, strive to completely renovate the way in which the Government operates, update business operations, develop the working lifestyles of citizens, alongside creating a safe, secure, and humane digital environment. The move aims to realise the dual goal of forming a digital Government, a digital economy, and a digital society, while simultaneously establishing digital businesses that have a global competitive capacity. Most notably, the digital economy is projected to make up some 20% of the country’s GDP in the future, with the proportion of the digital economy in each economic sector reaching at least 10%, whilst annual labour productivity will likely increase by at least 7%. In addition to this economic transformation, Vietnam is set to be among the top 50 countries in terms of information and communication technology development index (IDI) within the next five years, among the top 50 countries in terms of the global competitiveness index (GCI), and in the top 35 countries in terms of the global innovation index (GII). To develop a true digital society, the digital gap must be narrowed, with the schedule for change ahead to 2025 outlining that the fiber optic network infrastructure will reach out to more than 80% of households and 100% of communes nationwide. Moreover, both 4G and 5G mobile network services and smart mobile phones will be universalised, while more than half of the country’s population will be making use of electronic forms of payment. Vietnam will also be looking to be among the top 40 countries globally in terms of the global cybersecurity index (GCI). To this end, there are plans to build and develop Vietnamese broadband infrastructure, upgrade 4G mobile networks, while simultaneously rolling out 5G mobile network. Furthermore, there will be an integration of 4G and 5G technologies into mobile products, plus popularizing smart phones across the country. There will be an expansion of domestic Internet connections, a push to popularise the .vn domain name, a greater development of Internet of Things infrastructure, and a further integration into sensors to transform traditional infrastructure into an important component of the nation’s digital infrastructure. The scheme is set to look at a number of priority areas subject to digital transformation, including health care, education, finance, banking, agriculture, transportation, energy, natural resources, the environment, and industrial production. VOV |
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Vietnam pushes for medicine self-sufficiency post Covid-19: Fitch Solutions02:45 The Vietnamese government intends to meet 80% of its domestic pharmaceutical demand through local drug manufacturers.Vietnam's goal of having the majority of its pharmaceutical demand be met by local firms will shape the country's medicine market, according to Fitch Solutions, a subsidiary of Fitch Group. Even prior to the Covid-19 pandemic, the Vietnamese government's support for the local pharmaceutical industry has remain steadfast, stated Fitch Solutions. This is in part driven by the authorities' push to meet domestic healthcare needs. As part of its strategy, the Vietnamese government intends to meet 80% of its domestic pharmaceutical demand through local drug manufacturers. This proposal is having a major impact on the vaccine market, with the country now able to produce 11 of the 12 vaccines included in the national expanded immunization program. While Fitch Solutions expected the government’s efforts will go some way towards improving Vietnam’s manufacturing base, the vast majority of local production will remain focused on cheap generic drugs given their limited technological capabilities. Taking this into account, Fitch Solutions said it will be a long time before the country can be classed as self-sufficient with regards to its pharmaceutical supply. With 160 factories meeting WHO - Good Manufacturing Practice standards, the domestic drug output is able to meet 45% of the demand, while the rest must be imported.
According to a report produced by the Vietnam Social Security, by the end of May 2019, there were 84 million people participating in the public health insurance system nationwide, covering 89% of the population. A target set by a resolution of the 6th Plenum of Communist Party of Vietnam states that by 2025 about 95% of the Vietnamese population will be covered by the national health insurance scheme. Hospital quality has improved continuously, and demands for hospital bribes have dropped to a 10-year low. Taken together with the government’s policy to provide mass quarantine largely free of charge, these data suggest that Vietnamese citizens did not have to worry about costs from Covid-19 tests (formal or informal), associated hospitalization, and centralized quarantine, thereby increasing their willingness to comply with extensive contact tracing and strict quarantine measures. Although coverage now approaches the full population, public healthcare remains chronically underfunded, with per capita spending on public healthcare sitting at just US$82 in 2019. While the government is focused on improving the delivery of public healthcare services, Fitch Solutions believed that limited public financing, uneven distribution of health services, inadequate infrastructure and a similar shortage of qualified workers will continue to obstruct innovative drug makers wishing to operate in the market. Vietnam's effective response against Covid-19 With a population of over 97 million, Vietnam has prior experience in responding to outbreaks of other infectious diseases including SARS, MERS, measles and dengue. In the case of the Covid-19, Vietnam relied on cost-effective solutions to combat the virus, including strategic testing, contact tracing through apps and effective public communication campaigns. In addition, it implemented a national lockdown between April 1 and 22. Vietnam’s effective response was enabled by the country’s ongoing efforts to improve governance and central-local government policy coordination, said Fitch Solutions. At least 110 laboratories across the country can perform real-time polymerase chain reaction testing for Covid-19 diagnosis, with a capacity of 27,000 samples per day. As of April 30, 2020, Vietnam had conducted 261,004 tests, with 967 tests per positive case or 2691 tests per million population. Not only did the country buy 200,000 tests from South Korea, but it also quickly developed its own successful test kits. The Vietnamese Covid-19 test kit was developed by scientists within a month. It is effective, affordable and fast, diagnosing suspected infections in just an hour. Using WHO-approved techniques, these test kits make it possible to isolate infected people and track down their contacts. It is also worth mentioning that, unlike other countries that rely on mass testing, in Vietnam, tests are only done on those likely to be infected. Hanoitimes VNN/Ngoc Thuy |
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Vietnam among leading countries for high biodiversity levels globally02:26 Vietnam has participated in a wide range of activities in response to World Environment Day on June 5, an occasion held by the United Nations Environment Program (UNEP) annually since 1982 which has turned into a widespread movement nationwide, serving to raise public awareness about environmental protection, biodiversity conservation, and climate change adaptation.
For this year’s World Environment Day, the theme chosen by the UNEP is the "Action for Nature", or Time for Nature. According to the UNEP, this year marks an important time due to the commitments made by various countries to preserve nature and biodiversity by moving to intensify a wide range of measures and activities aimed at rejuvenating degraded ecosystems. This fits in with a wider goal of responding to climate change, boosting food security, and protecting water resources, with this year marking an occasion for countries to unite for the goal of taking practical actions for the purpose of protecting nature and the earth. In line with this, Vietnam has been recognised as one of 16 countries globally that has the richest biodiversity with a system of established reserves. Currently, there are 173 reserves located nationwide, spanning a total area of over 2,500 hectares, including 33 national parks, 66 nature reserves, 18 species and habitat conservation areas, along with 56 landscape protection areas, up by seven reserves from 2015 with a total increased area of nearly 73,260 ha. Furthermore, the country is also home to nine Ramsar areas covering over 120,000 ha, 10 marine protected areas with a total area spanning nearly 188,000 ha, and nine areas recognised as World Biosphere Reserves with a total area of over 4.2 million ha. Indeed, 2019 saw the Ministry of Natural Resources and Environment compile a nomination file to see four additional ASEAN Heritage Parks recognised by the ASEAN Secretariat, bringing the total number of ASEAN Heritage Parks nationwide to 10. The Ministry of Natural Resources and Environment has been co-operating with international organisations as a way of successfully establishing two wetland conservation areas, most notably Thai Thuy in Thai Binh province and Tam Giang - Cau Hai Lagoon situated in Thua Thien Hue province.
In response to World Environment Day, the country has come up with an array of slogans such as “Harmony with nature - conservation of biodiversity”, “The Earth needs us! Stay united against climate change”, “Use utensils from recycled materials”, and “Fishing the wrong way is destroying the biological balance”. Other phrases include “Using green materials contributes to environmental protection”, “Rational use of biodiversity resources”, “Biodiversity - Journey to maintain life”, “Biodiversity - True awareness”, and “Action for nature - Our responsibility”. Vietnam must affirm its biodiversity commitments to the world Deputy Minister of Natural Resources and Environment Vo Tuan Nhan stated that recent years has seen the biodiversity conservation draw the participation of many ministries, sectors, and localities, along with both domestic and international conservation organisations, ultimately serving to achieve remarkable results. “Conservation of natural ecosystems and endangered and precious wild species, along with the strengthening of law enforcement on the protection of wild species has strengthened in recent years as a means of preventing the trading and consumption of endangered species, contributing to the protection of biodiversity of Vietnam and the world, ”said Deputy Minister Nhan. According to the Deputy Minister, through the genetic fund programme, precious gene sources nationwide can be successfully conserved, especially with regard to genetic resources of plants, animals, aquatic products, and medicinal materials. To date, more than 30 provinces nationwide have included various types of genetic funds when striving to implement their annual tasks.
Indeed, throughout 2019 and since the start of the year, 40 decisions were issued which permit the transfer of genetic resources abroad as a means of serving non-commercial studies and research of eligible organisations and individuals. The nation has been thorough in carrying out a strategic environmental assessment and environmental impact assessment in an effort to control the impacts of socio-economic development activities on biodiversity. In addition, plans and projects which are could affect ecosystems, species, and nature reserves are all focused on assessing the overall impact on biodiversity in order to devise preventive measures aimed at reducing the negative impact on the environment and biodiversity as a whole. Before entering the "ecosystem restoration decade", Deputy Minister Nhan put forward the notion that the nation must be proactive in affirming its contributions in order to achieve common global goals. This can be achieved by adopting new policies, implementing strategies, plans, and schemes to add to the conservation and sustainable use of biodiversity, restoration of degraded forest, sea and wetland ecosystems, and effective conservation of species and genetic resources. “It is necessary to carry out synchronised tasks, solutions and to prioritise the implementation of key tasks, particularly in the process of amending the Law on Environmental Protection, paying attention to regulations on the protection of natural landscapes and biodiversity, reducing the impact from socio-economic development activities to biodiversity as a solution to ensure sustainable development, ” the Deputy Minister noted. He also underscored the necessity of developing the National Strategy and Planning on biodiversity conservation ahead for the next 10 years, while simultaneously ensuring consistency and synchronisation in order to achieve conservation objectives leading up to 2030. This can be done alongside building a database on biodiversity as a basis for the management and conservation of ecosystem diversity. It is therefore essential to continue increasing international co-operation, inter-sectoral collaboration, and the participation of both the private sector and the community. These efforts can be taken alongside strengthening the capacity of State management over biodiversity conservation from central to local levels in order to improve the effectiveness of biodiversity management, Nhan added. VOV |
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BUSINESS NEWS HEADLINES JUNE 502:37 High mobility and recovery to boost Vietnam economy  Viet Nam’s economy is bouncing back fast after COVID-19 thanks to its high rate of mobility, according to Canada-based data visualisation agency Visual Capitalist. With high mobility and high recovery as social distancing orders have been eased since mid-April, the country is seen to be regaining its momentum and kick-starting economic activities. According to Visual Capitalist, high rates of recovery lead to the removal of restrictions, allowing people to go back to work. As of Monday afternoon, Việt Nam earned a recovery rate of 85 per cent with 328 confirmed cases including 279 patients given the all-clear. Its mobility rate tops the world at slightly under 20 per cent, meaning people can now go to the office and travel quite freely within the country in a “new normal”. New Zealand is ranked first in Visual Capitalist’s chart for its swift and efficient responses which curtail the total tally of infection and bring a 98 per cent recovery rate. The US, the world’s worst-hit country by COVID-19, is classified as low mobility and low recovery for reporting over 1.7 million cases. Some states, however, have shown expectations to gradually lift restrictions on social and business activities which may lead to the second wave of infections, according to Visual Capitalist. As of Sunday, Việt Nam racked up its 45th consecutive day without community spread of the coronavirus, with only a few reported cases as the country is bringing home Vietnamese overseas on a limited number of specially-arranged repatriation flights. The country received some 340 citizens returning from Singapore on Sunday. Gov't sets up Steering Committee on economic census in 2021 Prime Minister Nguyen Xuan Phuc has signed a decision on establishment of a central steering committee on economic census in 2021, which will be led by Minister of Planning and Investment Nguyen Chi Dung. The 18-member committee is responsible for developing a plan for national-scale economic census, collecting basic information on production and business activities, and conducting comprehensive assessment on the status of the national socio-economic development. Specifically, the census aims to collect information about production and business units, non income-generating administration agencies, non-governmental organizations and individual production and business establishments, among others. It is expected to provide a comprehensive assessment of the country's socio-economic development situation and trends and will serve as a basis for building socio-economic development plans and policies for the Party and State. The investigation will focus on gathering information to identify surveyed units, labor and income, production and business costs, tax payment and budget contributions, scientific research and technological development (R&D), innovation, energy consumption, technology application, financial access, and others./. Central steering committee for economic census established A central steering committee for the economic census in 2021 will be established under Decision No. 752/QD-TTg signed by the Prime Minister on June 3. The 18-member committee is headed by Minister of Planning and Investment Nguyen Chi Dung. It is tasked with putting forth a plan on national economic census in the year, organising a pilot census and implementing the national one. The minister will issue a decision on the establishment of a working group in charge of assisting the steering committee. The decision takes effect since the signing date./. Kien Giang rice farmers switch to guava for better income Many farmers in Kiên Giang Province’s Tân Hiệp District have begun to earn steady incomes after turning unproductive rice fields into guava orchards. Trần Thị Bé Thùy of Tân Hiệp Town, one of first to do so, has been earning VNĐ200 million (US$8,600) a year from her 4,000sq.m orchard for the last four years. She intercrops pennywort and lemongrass with the guava and grows water lily in the orchard’s irrigation ditches. She harvests around 100kg of guava daily since she uses advanced techniques to ensure the fruits grow year round, she said. “My family earns an income every day, our lives are comfortable and better than before.” Under an agricultural restructuring plan, the Cửu Long (Mekong) Delta district has encouraged rice farmers with unproductive fields to switch to other, high-value crops in recent years, and many have chosen to grow guava since it is easy to grow and has steady demand. The district has 173ha under fruits, including 53ha of guava, according to its Bureau of Agriculture and Rural Development. Bùi Quốc Duy, the head of the bureau, said rice is the agricultural district’s main crop, but the price of the grain has been volatile in recent years. Guava requires less tending and has few diseases, he said. It takes eight months for guava seedlings to start fruiting. Farmers only need to fertilise the plant once every two or three months. When fruits appear, farmers cover them with plastic bags to protect them from pests. The guavas grown in the district are clean since farmers do not use pesticides. As a result, the fruits are very popular with consumers, and farmers say they cannot meet the market demand. They are sold in the province and around the delta. Traders buy the guavas at VNĐ10,000-25,000 per kilogramme depending on when they are harvested. Duy said the district has large areas affected by alum, which are suitable for growing the fruit. Local authorities encourage farmers to develop the garden – pond – animal pen model to use their land efficiently and earn high incomes. Visitors to Ha Long Bay sharply increase The number of tourists to Ha Long Bay has considerably increased after the Covid-19 pandemic. According to the management board of Ha Long Bay, following the province’s decision to offer free tickets to Ha Long Bay from May 14, the bay has seen more tourists.Ha Long Bay welcomed 3,000-4,000 travellers per day between Monday and Friday, while the figure reached up to 20,000 daily at the weekend. Pham Dinh Huynh, deputy head of the bay management board, said at present, visitors only have to pay the boat rental which has also been discounted to just VND1,000-150,000 (USD4.34-6.52) per person or VND1.5-2 million for the whole boat. The province’s tourism stimulus programme has proved goods results. Most of the local hotels and restaurants have been full. Nguyen Ngoc Minh, a tourist boat owner, said that all tourist boats in Ha Long have basically resumed their operation as normal thanks to the visitor increase with three or four trips per day. Visitors to Ha Long Bay, Yen Tu tourist site and Quang Ninh Square from May 14 and June 1 enjoyed free tickets. The priority will be also applied on holidays Vietnamese Family Day (June 28), Vietnam Tourism Day (July 9) and War Invalids and Martyrs Day (July 27), August Revolution (19/8), National Day (2/9), Vietnamese Women’s Day (20/10) and Vietnamese People's Army Day (22/12). However, the free tickets are not applicable to those staying overnight in the bay. Aviation industry optimistic with growing passengers Vietnamese airlines have resumed nearly full capacity on domestic routes and are ready for international routes once the virus outbreak is curbed. Many airlines are ready to resume international routes. Vo Huy Cuong, vice head of the Civil Aviation Administration of Vietnam, agreed that Vietnam has to be ready to reach out to the world once the control and quarantine measures are lifted. "The aviation industry will return to normal but there is still a way to go," he said. Cuong said they would create the most favourable conditions for the airlines. They are also researching plans to help airlines increase the number of domestic flights and open new routes. "Vietnam Airlines and Bamboo Airways have proposed new domestic routes. On some routes, the number of flights already accounted for 80% of the Tet Holiday peak. Many airlines have recovered. However, because of Covid-19 the number of international passengers was less than 50% of the 2019's," he said. The management boards at Noi Bai and Tan Son Nhat airports face several problems like the infrastructure, landing and taking-off hour problems. Half of the fleets of Bamboo Airways, Vietjet Air and Vietnam Airlines are still grounded. Cuong said the infrastructure would be greatly improved after the outbreak. At the conference about Vietnam aviation industry and economic recovery, Nguyen Van Dung, head of Binh Dinh Province Department of Tourism was optimistic that Vietnam would recover very quickly. For the aviation industry, the three most important factors are management work, flight route restructuring and promotional programmes. "What should we focus on now? What is the most urgent among the three factors?" Dung said. Economist Tran Du Lich said once the aviation industry recovers, it will help boost the tourism industry including hotels and restaurants and the economy in localities. 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. MM Mega Market Vietnam teams up with Saigon Professional Chefs’ Guild MM Mega Market Vietnam officially signed with Saigon Professional Chefs’ Guild (SPC) to work together with the common goal of bringing benefits to consumers in term of cuisine knowledge. The two sides have committed long-term collaboration in sharing expertise, experiences, and recipes with consumers, especially customers in the food services business (HORECA) and the company (MM)’s staff. MM will also introduce safe materials that it is distributing to ensure food safety for customers with every meal as well as to support the guild during social activities, annual events, training courses, and more. In 2019, MM had sponsored Vietnam’s chef team competing in the Culinaire Malaysia cuisine championship and had brought home two trophies, eight gold medals, one silver, and eight bronze. “Before this co-operation between MM and Saigon Professional Chefs' Guild (SPC), we have worked together on several projects and international competitions, and SPC highly appreciates MM’s ability to provide quality and safe food to consumers, especially its variety choice of ingredients for chefs. This helps us to have more chance to develop new and better meals as well as to train the members of SPC easier and more efficiently,” said Pham Son Vuong, president of SPC at the signing ceremony. MM has invested and developed food product platforms to ensure good quality control As a food supplier to almost one million professional customers including hotels, restaurants, and canteens in Vietnam, Thai-backed MM has invested and developed food product platforms to ensure good quality control from farm to fork. The company is operating four platforms currently, including a vegetables platform in Dalat city supplying more than 12,000 tonnes of VietGAP-certified products annually, a fish platform in Can Tho city in the Mekong Delta providing 2,000 tonnes of fish per year, the pork platform in Dong Nai province (more than 3,000 tonnes a year), and the Ben Tre fruit platform that supplies more than 2,400 tonnes of fresh and safe fruit a year. MM aims to expand with one more food service and two depots this year and develop food product platforms such as poultry in the south and pork in the north in the near future to have in place a close and complete safe food provision chain aligning with international standards. Vietnam Report names most reputable developers Vietnam Report has ranked the top property developers in the market in terms of reputation, based on financial capacity released in the latest financial reports. Other criteria in naming the groups involved media products from each company, and survey results from experts in the real estate market, as well as residents who are actually living in the projects of the candidates. The real estate market in Vietnam experienced both highs and lows in 2019. The overall situation was still at low supply and high demand, especially in major cities like Hanoi and Ho Chi Minh City. The absorption rate of property products last year was at 70 per cent compared to the 60 per cent of 2018, with some major locations achieving 80 per cent. The supply to the market was reported at more than 107,000 units, only more than 60 per cent compared to this in 2018. Of those, more than 72,800 units were sold last year, occupying 64.7 per cent compared to the previous 12 months. According to Vietnam Report, the tightened procedures on project approvals and implementation, as well as tightened credit sources for the real estate sector, were the main reasons for the low supply. Also last year, nearly 600 businesses were closed down within the sector. Many small-sized and startup enterprises were disbanded due to lack of investment capital and facing difficulties in capital approach. Vietnam Report also stated that nearly 53 per cent of real estate businesses assessed that the investment environment in 2019 was slightly worse than in 2018. Vietnam seeks to attract relocated investment in wake of coronavirus As global companies look to relocate their manufacturing facilities after the coronavirus pandemic, the Prime Minister has decided to set up a special working group to formulate a plan to attract this important source of capital. The head of government also asked localities in key economic regions to strive to become magnets for major foreign corporations and receive re-directed regional and global flows of investment so as to translate the challenges presented by the coronavirus into opportunities. According to the Ministry of Planning and Investment, foreign firms in the fields of IT and high technology, electronics and e-commerce, consumer goods and retail sales and logistics are seeking to relocate their investments. Multinational companies are speeding up the process of diversifying their investment destinations, relocating their manufacturing bases, expanding their business and implementing new projects, and Vietnam has been earmarked as a safe potential destination for such a shift. But the opportunity is not only for Vietnam as other countries in the region are also working aggressively to attract high-quality investment during this relocation. If Vietnam acts slowly, it will miss out on the opportunity. The advantages of a safe investment climate, cheap labour and tax incentives are not enough now to attract foreign investors. In this new period, Vietnam must introduce more competitive policies so as to attract major multinational companies, which possess advanced technologies and are also environmentally friendly. The establishment of the special working group on attracting FDI is a shift in the approach to of seizing on such opportunities. Instead of waiting for foreign investors to visit Vietnam and learn about the business environment, the working group will proactively make plans to see what foreign investors need for their investment so that Vietnam can take appropriate actions to bring the benefits to both sides. In other words, the working group’s task is to proactively look for high-quality capital and attract world-class firms in order to change Vietnam’s economic structure and assist the country with its scientific and technological development in the future. After more than 30 years of economic liberalisation, integration and business environment reform, Vietnam has become an attractive destination for foreign investors, with FDI playing a significant role in Vietnam’s socio-economic development. However, there are still many problems in relation to foreign investment activities in Vietnam. Therefore, this is a turning point for Vietnam to begin attracting a new generation of foreign investment. If Vietnam wants to attract large firms to set up their manufacturing bases in Vietnam in the upcoming economic migration, Vietnam needs to create a transparent business environment and construct good infrastructure so that it is fully prepared to receive new projects when investors decide to pour their capital into the country. Creating new growth engines for the economy The free trade agreement between Vietnam and the European Union (EVFTA) will open up extensive potential, a new marketspace and high interactivity for the Vietnamese economy. During its ongoing ninth session, the 14th National Assembly (NA) will press the button to ratify the EVFTA, creating new momentum for comprehensive and sustainable development and an expectation to facilitate the country’s deeper integration into the world economy via appropriate solutions. A report on how the deal will affect Vietnam, presented by a Government representative at the NA, showed that in terms of growth, the EVFTA is expected to increase the country’s GDP by an annual average of 2.18-3.25% (in the first five years of implementation), 4.57-5.30% (in the next five years) and 7.07-7.72% (in the five years after that). Regarding exports, the EU is now one of the major trading partners of Vietnam, with the economic structure between the two being complementary rather than directly competitive. Given that fact, the EVFTA will surely see a big push on exports after coming into force. The commitment to reduce or eliminate tariff barriers for goods into the EU is a great advantage for Vietnamese businesses to tap into this US$18 trillion market. As calculated, the agreement will help Vietnam’s export turnover to the EU expand by 42.7% by 2025 and 44.37% by 2030 compared to a no-deal scenario. During the first-phase sittings of the ninth session, NA deputies profoundly analysed the significance, impacts and contributions of the EVFTA to Vietnam’s sustainable development across an array of immediate, middle-term and long-term aspects. They also commented on a number of issues in building and perfecting legal institutions, identifying new motivations associated with renewing the growth model, improving the investment and business environment to attract foreign investment, promoting the business community’s linkages to create a closed supply chain and together improve competitiveness. The EVFTA not only brings opportunities and challenges regarding economic terms, but also features pressure across the spheres of politics, culture, social security and external relations, including the risk of falling behind and a middle income trap. To prepare for such a large playground, the Government has drafted an action plan so that after the NA’s EVFTA approval, ministries and sectors will get down to carrying out their assigned tasks. The EVFTA features strict regulations and rules on investment procedures, customs, trade facilitation, technical standards, quarantine measures, intellectual property, and sustainable development. The full observance of these provisions requires reforms of the legal system. However, in fact, a series of international institutions to which Vietnam is a signatory have unveiled limitations in turning opportunities into reality, which mainly stems from delays at the stage of finalising legal institutions. As noted by a NA deputy, nearly two years ago, the NA approved the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) with the expectation that Vietnamese goods would flow steadily into the CPTPP member nations. However, Vietnam’s exports to the market has have increased by only 7.2% thus far, which means that the country has not yet benefited much from the CPTPP. The EVFTA facilitates Vietnamese goods’ entry into the EU market, but it also sets many higher standards than those committed in the CPTPP. Deputies Hoang Van Cuong (Hanoi) and Vu Tien Loc (Thai Binh) suggested that, in the immediate future, the Government should identify the strongest products to be exported to the EU market, thence assessing their ability to meet the EU’s requirements and technical standards, as well as implementing measures to help those goods satisfy EU standards. In the long term, the Government needs to drastically reform economic institutions, while strengthening the publicity, transparency and validity of policy and law systems to fully implement international commitments and create a healthy business environment with fair competition. Administrative reforms should be accelerated in all fields, especially those directly related to EVFTA commitments on investment, construction, land, tax and customs. Moreover, attention should be paid to completing economic restructuring associated with renewing the growth model towards improving quality and efficiency, in addition to effectively exploiting complementary and mutually supporting factors in terms of the labour force, capital, natural resources and science and technology. Internalisation of technology, technology transfer and high-quality industrial human resources must be Vietnam’s labour advantages in the future. However, at present, the majority of small and medium-sized enterprises (SMEs) in Vietnam (accounting for nearly 98% of the total number of businesses) have low competitiveness with limited financial resources, technological capabilities and labour productivity. To support enterprises, many NA deputies recommended that the Government should synchronously develop all types of markets and strongly develop export markets; perfect the management mechanism and implement new import and export management tools in line with requirements; and continue to bolster communication to raise firms’ awareness of the regulations and commitments in the EVFTA. Ministries and sectors should proactively study and apply appropriate measures to support and protect the legitimate interests of domestic manufacturing industries above competition from foreign goods, otherwise, most Vietnamese businesses will face great challenges in participating in and taking advantage of the opportunities presented by the EVFTA. Disbursement of investment capital from State budget rises sharply in May Approximately VND31.1 trillion (US$1.33 billion) in investment capital sourced from the State budget was disbursed in May 2020, an increase of 17.5% over the same period in 2019, according to the General Statistics Office. In the January-May period, total investment capital from the State budget was estimated at VND116.3 trillion (US$4.99 billion), equivalent to 24.9% of the year’s target and up 15.6% over the same period last year. The disbursement rate of investment capital from the State budget in May and in the first five months of this year reached the highest levels in the 2016-2020 period. The investment capital has soared sharply in the context that the COVID-19 pandemic has been well under control while investment in basic construction has returned to normal and the progress of major construction projects is being accelerated. In new normalcy, Hanoi seeks to lure more investment The upcoming investment promotion event shows the city’s determination to be the pioneer among localities in pushing for economic recovery after Covid-19. The Hanoi Party Committee has announced the city will host an annual investment promotion conference at the Vietnam National Convention Center on June 27. The organization of the conference right after Hanoi’s early containment of the Covid-19 pandemic would send a strong message on the capital city’s efforts in particular, and of Vietnam in general, to lure investment from domestic and abroad businesses. More than ever, Hanoi remains a safe and stable investment destination for investors, stressed the municipal Party Committee. The investment promotion conference, themed “Hanoi 2020 – Investment and Development Cooperation”, shows the city’s determination to be the pioneer among Vietnam’s cities/provinces in recovering and developing the economy in the post-pandemic period. According to the committee, the process would boost Hanoi’s administrative reform and enhance the city’s business and investment environment towards the ultimate goal of achieving high economic growth. In 2020, Hanoi targets an economic expansion rate at 1.3 times higher than the national average. The Hanoi Party Committee requested the municipal People’s Committee to strictly comply with current regulations on approving new FDI projects, focusing on those with modern technologies and environmentally-friendliness, and in line with the city’s vision for sustainable development, national and social security. Chairman of the Hanoi People’s Committee Nguyen Duc Chung on May 9 said at the event, the city will issue investment certificates for some 100 projects. Among them, domestic investors are expected invest nearly VND330 trillion (US$14.28 billion), including 26 social housing projects worth VND72 trillion (US$3.11 billion) for low-income buyers. Chung also revealed Hanoi would issue investment certificates for foreign-invested projects worth US$3.5 billion, and the city would continue to call for investment in IT, logistics and e-commerce. FDI commitments to Hanoi in the year to May 19 increased 6.1% against the previous month to US$1.04 billion. From the start of this year, the capital city has approved 255 new projects worth US$327 million and allowed other 63 to pump an additional US$378 million in the five-month period. Foreign investors also contributed US$340 million in capital to other 468 projects. Specific criteria needed for Vietnam to attract FDI into priority areas The Hanoitimes - The quality of state management and administrative procedures are the top concerns of the business community, not only the progress of cutting red tape, said an expert. In addition to removing obsolete administrative procedures, Vietnam should issue specific sets of criteria to ensure greater efficiency in attracting foreign direct investment (FDI) into priority areas, according to Nguyen Anh Duong, head of the Macroeconomic Policy Department under the Central Institute for Economic Management (CIEM). “Low quality of institutional framework, digital infrastructure and productivity are three bottlenecks hindering Vietnam’s development in the post-Covid-19 period,” Duong said at a conference on June 1. Regarding this issue, economist Vo Tri Thanh, CIEM’s former vice director, said the Covid-19 pandemic has triggered the trend of politicization of economic activities, which was best demonstrated by the US – China tensions and protectionism. Thanh said in a world of growing uncertainties, countries like Vietnam should adopt flexible policies and act fast to grasp a new wave of investment capital as foreign investors are looking to diversify their global value chains away from China. “It is not a coincidence that Prime Minister Nguyen Xuan Phuc has set up a task force to promote investments in the country,” Thanh added. “Instead of waiting for others to come, we have to be active in approaching potential investors and addresses bottlenecks in attracting FDI,” Thanh asserted. Thanh, however, noted that while Vietnam is pursuing higher quality FDI, it is essential to continue to support the private sector, saying this would help make a strong and independent economy. Dau Anh Tuan, director of the Legal Department at the Vietnam Chamber of Commerce and Industry (VCCI), said the initial success in tackling Covid-19 proved the country’s stable business environment and efficient state governance. Tuan noted as the EU – Vietnam Free Trade Agreement (EVFTA), the EU’s only second trade agreement to date in the Southeast Asian region, is set to come into play, Vietnam is holding major advantages to attract investors compared to regional peers. However, as the Covid-19 pandemic is transforming the world, Vietnam has to move fast, he stated. “Vietnam should shift its focus from addressing business concerns to creating a favorable environment for growth,” Tuan added. Improving the quality of state management and smoothing administrative procedures are highly demanded by the business community, not only the progress of cutting red tape, Tuan continued. Disbursement of FDI in Vietnam in May is estimated at US$1.55 billion, the highest monthly figure since February, a report of the Foreign Investment Agency (FIA) under the Ministry of Planning and Investment has shown. The data indicates a positive sign that foreign investors are accelerating their projects’ progress as the Covid-19 pandemic has been initially contained in Vietnam. Overall, disbursement of FDI projects in Vietnam totaled US$6.7 billion in the first five months of 2020, representing a decline of 8.2% year-on-year. Meanwhile, FDI approvals in the January – May period fell 17% year-on-year to US$13.9 billion. The figure, however, is higher than that of the same five-month period from 2016 to 2018, posting increases of 37.6%, 14.8% and 40.4% compared to the corresponding period of 2016, 2017 and 2018, respectively. Vietnam invests 180 million USD overseas in five months Vietnamese enterprises injected over 180 million USD into 18 foreign markets in the first five months of this year, equivalent to 98.7 percent of the same period last year. During the period, 162 million USD was pumped into 60 new projects, nearly double that of last year’s period, thanks to a 91.5 million USD overseas project from Germany’s Vonfram Masan Co., that received an investment licence in May. Meanwhile, 19 million USD was added to 11 underway projects, down 77.8 percent year-on-year, reported the Foreign Investment Agency under the Ministry of Planning and Investment. Germany drew the highest amount of capital with four projects worth 93 million USD, accounting for 51.3 percent of the total. The US came next with 22 million or 12 percent./. India-ASEAN connectivity scrutinised Speakers from India, Vietnam, Thailand, Malaysia and Laos discussed trade and geopolitical connectivity between Indian and ASEAN at a recent video conference, during which they said that the two sides have stayed closed in numerous fields. Scholars from ASEAN all affirmed that India is a good friend and close partner. Parties involved, they suggested, should work together to consolidate bilateral relations and foster people-to-people diplomacy. Faisal Ahmed, an Associate Professor of international business at FORE School of Management in New Delhi, evaluated that ASEAN is a region which is progressive in economy and rich in culture and holds important geopolitical significance. Merchandise trade between India and ASEAN reached 97 billion USD during 2018-2019 and their service trade was valued at 45 billion USD. At the conference, scholars also appreciated Vietnam’s achievements in the fight against the COVID-19 pandemic, with few patients and no fatality. Le Van Toan, Founding Director of the India Research Centre under the Ho Chi Minh National Academy of Politics, said that Vietnam has made responsible contributions to global issues. Amid the COVID-19 outbreaks, Vietnam has not only shared disease prevention experience with other countries but also provided medical equipment and supplies for many nations, including India. He suggested studying cultural traditions which have formed the Vietnam-India relations over the past years./. Vietnamese fabrics exempted from Indonesia’s new import tariffs Made-in-Vietnam fabrics have been exempted from new import tariffs of Indonesia, which have been imposed on some textile products from May 2020 until November 2022. Aside from Vietnam, other countries and territories exempted from the safeguard measures include the Republic of Korea and Hong Kong for the imports of synthetic yarn and curtains, as well as India also for fabrics, according to the Indonesian Finance Ministry. In 2019, the Indonesian government imposed temporary additional duties on imports of textiles and textile products up to 67.7 percent. The fresh move is a safeguard measure to protect the domestic upstream industry from a recent surge in imports and encourage the use of domestic market products. Previously, Moody’s Investors Service warned that the US-China trade tensions could lead to an influx of Chinese yarn, fabrics, and garments into Indonesia. It said, potentially disrupting the so far stable levels of demand and supply in Indonesia. Moody’s explained that tariffs imposed by the US on Chinese textile exports are at 25 percent versus the 10-15 percent that Indonesia has implemented./. Foreign e-commerce firms required to set up representative office in Indonesia The Indonesian Ministry of Trade has issued a decree requiring foreign e-commerce firms to set up a representative office in the Southeast Asian country. The new decree will be effective in six months from the date of issuance on May 13. The policy will be applicable to the operators that have transactions with more than 1,000 consumers and/or have sent more than 1,000 packages to consumers in one year period. Last year, President Joko Widodo signed a governmental regulation concerning trade via electronic systems or e-commerce platforms. According to the regulation, foreign business operators who actively bid and conduct electronic trading to consumers domiciled in Indonesian jurisdiction who meet certain criteria, for example, the number of transactions, transaction value, number of shipping packages, and the number of traffic or accessors, are considered to meet physical presence in Indonesia. Foreign e-commerce firms are required to have, include, or convey the identity of a clear legal subject and meet the provisions of the laws and regulations in export and import as well as information and electronic transactions. In addition, in conducting transactions, these business actors are obliged to assist government programmes, among others, prioritising trade in goods and domestic products. They are also required to use Indonesian high-level domain names (.id) for Electronic Systems in the form of internet sites and store data and information related to financial transactions for a minimum period of 10 years./. Rice exports to EU anticipated to make breakthroughs through EVFTA The impending European Union-Vietnam Free Trade Agreement (EVFTA) is projected to act as a boost for export turnover and enhance the competitiveness of Vietnamese rice in the EU market, according to Pham Thai Binh, General Director of Trung An High-tech Agriculture Joint Stock Company. Despite the recent outbreak of the novel coronavirus pandemic having a significant impact on exports in general, the rice industry in particular, the demand for rice consumption in European countries is predicted to increase since it is considered as an essential food item, Binh observed. Indeed, he attributed the recent increasing demand in the company’s rice orders from countries such as Australia, Germany, and France, to the large number of overseas Vietnamese currently living in these nations. Binh noted that Vietnamese rice exports to the EU market are subject to high taxes of up to 45%, with some EU countries even moving to impose import duties of up to 100%. It is therefore anticipated that when the EVFTA comes into force it will serve to help Vietnamese rice products enjoy a greater competitive advantage in comparison to the Cambodian rice, an item that is currently exempt from import tax in the EU market. If the EVFTA is subsequently ratified by the Vietnamese National Assembly as expected, the trade deal is poised to come into effect in August, with the tax rate imposed on rice set to be immediately slashed to 0%. This dramatic tax cut is predicted to greatly bolster rice exports to the EU market in the near future, Binh added. According to the executive, the EU is a highly demanding market when it comes to food hygiene and safety. Therefore, items that contain residue of pesticides or banned substances will find it very difficult to enter this market. To make inroads into the market, Binh said local firms must obtain GlobalG.A.P certificates and swiftly move to adapt their organic farming methods in order to develop production chains that come up to international standards. Trung An company is currently exporting its products to the EU and has subsequently met the stringent requirements set by EU importers. The firm can now immediately accelerate its exports to the European market once the trade pact comes into force. To seize upon the benefits brought about by the EVFTA, Binh suggested that the Ministry of Industry and Trade (MoIT) organise training courses for businesses to gain a better understanding of the details of the trade pact. Similarly, the Ministry of Agriculture and Rural Development should organise training courses to help farmers gain insights into new farming methods which will serve to meet standards set by EU importers and ultimately allow Vietnamese rice to gain entry into the EU market. According to the Vietnam Food Association, despite the rice export quota to the EU standing at only 80,000 tonnes, Vietnamese rice exported to this market is generally of high quality. Therefore, the status of local rice will be elevated within the international market upon gaining entry into the EU. Vietnam’s audiobook and podcast platform Voiz FM secures seed funding from 500 Startups Voiz FM announced that it successfully raised an undisclosed seed amount from 500 Startups Vietnam. The audiobook and podcast platform has seen doubled growth in its user base in recent months, following a surge in demand as customers turn to audio media during the coronavirus quarantine. Voiz FM was launched in late 2019 by a group of three Vietnamese co-founders to capitalise on opportunities in the emerging audio media space. According to Deloitte, the global audiobook and podcasting markets are set to grow to $3.5 and $1.1 billion in 2020, respectively. It demonstrates impressive annual growths of 25 and 30 per cent, compared to that of the broader global media and entertainment sector at 4 per cent. Voiz FM started off with audiobooks. In contrast to a number of other Vietnam-based platforms making “easy money” from online piracy, Voiz FM has taken a long-term approach and attained copyrights for 100 per cent of its published content. In only six months, it has acquired exclusive publishing rights for more than 1,000 best-selling titles, partnering with top-tier publishers in Vietnam including First News, Kim Dong, and Tre Publishers, among others. According to Binh Tran, general partner of 500 Startups Vietnam, the venture capitalist is bullish on the market opportunities as well as the team’s dedication to customers. Voiz FM will spend the new funding on product development and market expansion. “Our product roadmap includes the launch of a recommendation algorithm in early July and an AI Voice functionality, which will allow users to choose their prefered voices for all titles, in October this year,” said Thai Tran, co-founder and CEO of Voiz FM. These developments are expected to further enhance its user experience and improve production productivity. The team also plans to expand to other Southeast Asian markets in the near future. 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. Industrial production index up 11.2 percent in May Vietnam’s index of industrial production (IIP) in May rose by 11.2 percent over the previous month but decreased by 3.1 percent year on year, according to the General Statistics Office (GSO). The growth of the May IIP was a positive signal during Vietnam’s fight against the COVID-19 pandemic and restoring development of the economy, the GSO said. At present, the pandemic is under control nationwide. Of the figure, industrial production decreased by 13 percent in the mining industry; 2.4 percent in the processing and manufacturing sector; 2 percent in the electricity production and distribution industry; and 2.3 percent in the water supply and waste treatment sector. The GSO also said the IIP in the first five months of this year increased by 1 percent over the same period last year. However, this figure was much lower than the growth of 9.5 percent in the first five months of 2019. During the first five months, the index surged by 2.2 percent in the processing and manufacturing industry year on year, lower than the growth rate of 10.9 percent in the first five months of 2019 compared to the same period of 2018. The index increased by 2.6 percent in the electricity production and distribution industry and 2.9 percent in the water supply and waste treatment sector. However, the index of the mining industry dropped by 8.1 percent year on year. The GSO reported that due to the complicated development of COVID-19, the supply chain of raw materials for production has been interrupted, thereby seriously affecting the domestic industrial production. Some industries saw a strong decrease in IIP during the first five months, including support services for mining (36.5 percent); repair, maintenance and installation of machinery and equipment (16.4 percent); motor vehicle production (16.3 percent); auto and motorcycle production (15.6 percent); and beverage production (14.6 percent). Meanwhile, some other industries gained IIP growth in the first five months compared to the same period of last year. They included the manufacture of medicines, pharmaceutical chemicals and medicinal materials (25.9 percent); production of coke and refined petroleum products (12.9 percent); pulp and paper products (9.3 percent); and production of chemical products (9.1 percent)./.  Coteccons denies allegations by Kusto Coteccons has rejected the recent allegations made in a press release by its major shareholder Singapore-based Kusto, which announced in the release that it will convene an extraordinary general meeting (EGM) on July 13 seeking to replace the board of Coteccons. Construction company Coteccons on June 3 said that it had received information about the EGM and the false allegations against the board of directors from Kusto. Kusto had earlier requested that an EGM be organized on October 15, 2019, to displace Nguyen Ba Duong and Nguyen Sy Cong as chairman and general director of Coteccons, respectively, but the board of directors rejected the request, said a representative of Coteccons. Based on the same allegations, Kusto had repeatedly requested an EGM on April 23, the representative noted, adding that this time, Kusto issued a press release on June 2 and asked the Vietnam Securities Depository Center for the Coteccons shareholder list to organize an EGM on July 13. Meanwhile, an annual general meeting is set to take place in late June, according to Coteccons. The Coteccons side affirmed that the allegations made in Kusto’s press release about its unsuccessful attempts to dialogue with the Coteccons board of directors and resolve issues internally were baseless. Such unfounded allegations have negatively affected the price of the Coteccons stock under the code CTD and its production activities, remarked Coteccons. The conflict of interest mentioned in Kusto’s press release was related to Ricons Construction Investment JSC. According to Kusto, Ricons, in addition to being Coteccons’ sub-contractor, is the firm’s opponent. The after-tax profit of Ricons was equivalent to 11% of that of Coteccons in 2015, but this figure surged to 51% in 2019. Some members of the Coteccons board of directors and management board hold similar positions at Ricons. Responding to this, Coteccons said that with the scale of revenue amounting to some US$2 billion and securing several projects valued at up to VND7 trillion, Coteccons surely has thousands of subcontractors and suppliers. “Ricons, Unicons or any other unit is only one of Coteccons’ subcontractors. The firm has detailed agreements with all of its subcontractors and suppliers. Aside from this, Coteccons has established the Expense and Contract Control Department to monitor contracts signed with partners, in line with the firm’s regulations,” noted Coteccons. The representative of Coteccons also said that since late 2019, the firm has not signed any agreement with Ricons. Stringent credit standards will not affect lending: SBV The strict credit standards of credit institutions will not affect their credit support for businesses and individuals affected by the Covid-19 pandemic, deputy governor of the State Bank of Vietnam (SBV) Dao Minh Tu said at a press conference on June 2. Responding to concerns that the refusal by credit institutions to lower credit standards would make it hard for businesses and individuals to access credit packages, Tu noted that lowering credit standards meant reduced credit safety for credit institutions and the country’s banking and financial system. Therefore, these institutions have to comply with safety regulations. “Credit support for businesses and credit safety must always happen in parallel,” Tu said. SBV has taken a number of measures to support businesses affected by the Covid-19 pandemic including debt rescheduling. From January to May, SBV lowered interest rates and interest rate ceilings twice for prioritized sectors. As of May 20, capital mobilization increased 1.85%, while credit grew 1.32% compared to late 2019. VNN |
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BUSINESS NEWS HEADLINES JUNE 9Foreign ownership ratio in Binh Son Refinery slips From 4.74 per cent two years ago, the foreign ownership ratio in Binh Son Refining and Petrochemical Co., Ltd. (BSR) – the operator of Dung Quat Oil Refinery – has slipped to 0.07 per cent. According to the latest update, the COVID-19 pandemic had a marked impact on the shares of Binh Son Refinery. In January 2018, BSR reported a successful initial public offering (IPO) with a complete take-up of the offered 242 million shares, equalling 7.79 per cent of its charter capital and the record selling price of VND14.8 million ($643.48). The average selling price was VND23,043 ($1), 57.8 per cent higher than the initial price. Foreign investors bought 147.83 million shares, equalling 61.2 per cent of the offered volume. Among these investors, Vietnam Opportunity Fund (VOF) spent $25 million to acquire 10 per cent of the offered shares and Vietnam Enterprise Investment Ltd. (VEIL) poured $10.55 million into this purchase. However, after the successful IPO, BSR’s shares have been on a consecutive plunge. In March 2020, the price was at a record low of VND5,000 (21.7 US cents) due to the impact of the COVID-19 pandemic. At present, it is at VND6,600 (28.7 US cents). Due to the consecutive plunge, foreign investors have been selling down their holding in the company. Notably, from the 4.74 per cent after the IPO, the foreign ownership ratio decreased to 2.4 per cent in late 2018, 1.34 in late 2019, and 0.07 per cent as of June 2. Regarding business results, in the first quarter of this year, BSR reported a loss of VND2.34 trillion ($101.74 million) due to the plunging price of crude oil and increasing unsold petroleum inventories. This year, BSR targeted acquiring an after-tax profit of VND1.28 trillion ($55.65 million), down 41.4 per cent on-year. The expansion of the refinery took 56 of the expected 78 months, however, the construction is still behind the deadline because the investor faces massive difficulties in arranging capital. Bringing Vietnamese fruits to the world market  The first batches of lychee harvested in Thanh Ha district, the northern province of Hai Duong were exported to Singapore, the US, and Australia in late May. This is a good premise for the export of lychee in the years to come, particularly in the context that the fruit has been heavily dependent on the purchasing power of the Chinese market. Hai Duong’s lychee farming areas which meet international standards and GlobalGAP standards for export to demanding markets are estimated to produce about 1,500 tonnes of lychee this season. Meanwhile, another lychee farming hub of Bac Giang province is scheduled to hold an online conference to promote lychee consumption early this month. The province has been granted with 18 farming area codes covering an area of 218ha in Luc Ngan district which are expected to produce a total volume of over 1,000 tonnes of lychee that meet export standards to the US and Europe. Recently, a memorandum of understanding has been signed between the Plant Protection Department (under the Ministry of Agriculture and Rural Development) and International Finance Corporation (IFC) - a member of the World Bank Group, with the aim of supporting the expansion of the export market for high quality Vietnamese fruit. Accordingly, in the next four years, the IFC will coordinate with the Plant Protection Department to improve the legal framework and public services to open up new export markets for Vietnamese fruits with the focus on fruits meeting international standards including dragon fruit and passion fruit. The IFC will also help launch an interactive online system on export-related requirements for dragon and passion fruits by 2022 including the building of standards, testing and the certification of fresh and processed products. This not only helps Vietnamese fruits increase their access to new markets, but also helps our country's vegetable and fruit export industry to quickly and effectively adapt to the changes and risks of natural disasters and epidemics or sudden declines in demand in some established markets like the situation that has been seen during the COVID-19 pandemic. Many new and high-quality markets have approved the import of Vietnamese fruit products, demonstrating that our products have met the most rigorous requirements of quality, food safety and hygiene. However, the farming areas and the volume of fruit eligible for export to fastidious markets are negligible, mainly focusing on small growing areas or several localities. In case importing countries need regular imports of goods with large contracts, Vietnam’s material areas may not have enough supply, leading to the risk of losing contracts. Therefore, Vietnam should expand the material areas that ensure quality and food hygiene and safety according to international practices, as well as specific requirements of each import country through the update and implementation of requirements on plant quarantine and traceability. It is also necessary to build a chain-based production process with links between stages from production to consumption. Enterprises and farmers should make efforts to strictly implement and fulfill each small step in the whole value chain while promoting the application of modern science and technology to production, preservation and transportation to create uniform and stable products in terms of design and quality. Australia supports Lai Chau’s economic recovery from Covid-19 As part of the Aus4Transport program, the Australian Government will work to promote investments in transport infrastructure and aid the economic recovery of the mountainous northwestern province of Lai Chau, which is reeling under the impact of the Covid-19 pandemic. As part of the program, the Australian Government will work together with the Ministry of Transport and Lai Chau Province to upgrade the road through Lai Chau, Lao Cai and Yen Bai to connect with the Noi Bai-Lao Cai Expressway. The Australian Embassy stressed that this would provide employment opportunities and increase access to services and markets for communities in the remote and mountainous areas of Vietnam’s Northwest. Early this week, Australia’s Ambassador to Vietnam Robyn Mudie met Giang Pao My, secretary of Lai Chau provincial Party Committee, to discuss cooperation under the program. The Aus4Transport program is financing the detailed design to help Vietnam secure a low-interest loan from the Asian Development Bank to finance construction under the project. Ambassador Mudie and secretary My also explored further business and people-to-people engagement opportunities between Australia and Lai Chau Province. Ambassador Mudie congratulated Vietnam, especially Lai Chau Province, for their success in effectively fighting the Covid-19 pandemic. Local exporters hit hard by Covid-19: survey Vietnamese enterprises, especially those in the export processing industry, are suffering from the impact of the ongoing Covid-19 pandemic worldwide, stated a recent survey conducted by the Ministry of Planning and Investment and announced by the Ministry of Industry and Trade. Among the nearly 130,000 companies approached by the ministry last month, 57.7% said their export market was shrinking rapidly and 47.2% said they could not ship their goods overseas. The pandemic has also reduced Vietnam’s export-import activities since the beginning of the second quarter, especially those with important trade partners such as the European Union, the United States, Japan and the ASEAN. According to the Tuoi Tre Online website, the nation’s export-import revenue reached US$37.9 billion in May, up 5% compared with the previous month but down 15.7% over the same period last year. Between January and May, the figure was pegged at US$196.8 billion, a 2.8% year-on-year decline. The three main categories of farm-aquatic products, fuel-mineral and processed goods slumped compared with last year, although they improved slightly against the previous month. The fuel-mineral group saw the steepest decline at 60.6% year-on-year. The United States remained the top market for Vietnamese products, with turnover reaching US$24.6 billion in five months, up 8.2% year-on-year, followed by China with US$16.3 billion, up 20.1%. Other key markets such as South Korea, Japan, ASEAN and the EU yielded between US$7.7 billion and US$12.9 billion each. To address these challenges, the Ministry of Industry and Trade will review and recalculate the export-import growth scenario for 2020. It plans to focus on goods with strong export advantages and markets that have signed free trade deals with Vietnam. Overseas shipment of mobile phones and spare parts exceeds US$ 17 bln Export turnover of mobile phones and spare parts was estimated at US$ 17.98 billion in the first five months this year, the Ministry of Industry and Trade reported. In the January-May period, total export turnover was projected at US$ 99.36 billion, representing a year-on-year decline of 1.7%. The country reported 17 commodities with over US$ 1 billion export turnover each which accounted for 82% of the total figure. Especially, four commodities earned over US$ 5 billion of export turnovers. Mobile phones and spare parts were the largest hard currency earner with US$ 17.98 billion; followed by computers, electronic products and spare parts with US$ 15.33 billion; garments and textiles with US$ 10.45 billion; and spare parts with US$ 8.53 billion. The MoIT said that the U.S. was the biggest importer of Vietnamese products with US$ 24.6 billion, representing a year-on-year growth of 8.2%; followed by China with US$ 16.3 billion (up 20.1%); the EU with US$ 12.9 billion (down 12%); ASEAN with US$ 9.4 billion (down 13.4%); Japan with US$ 8.1 billion (up 2.2%); the RoK with US$ 7.7 billion (down 0.5%)./. Foreign investors pour US$194 billion into Vietnam's industrial and economic zones In the first five months of 2020, industrial parks and economic zones drew 390 foreign projects worth US$4.3 billion. Vietnam's industrial parks (IPs) and economic zones (EZs) have so far attracted 9,850 foreign-invested projects with total registered capital of nearly US$194 billion, 70% of which has been disbursed, according to the Ministry of Planning and Investment (MPI). Meanwhile, IPs and EZs have received VND2,300 trillion (US$99 billion) in terms of newly-registered capital and additional capital poured into 9,650 projects carried out by Vietnamese investors, stated a MPI’s report, adding 45% of the said amount has been disbursed. In the first five months of 2020, industrial parks and economic zones drew 390 foreign projects worth US$4.3 billion. Due to the Covid-19 pandemic, revenues of enterprises operating in IPs and EZs suffered an 8% decline year-on-year in the January – May period to US$81 billion, while their exports rose 4% to US$58 billion. Additionally, over 3.82 million workers are being employed in IPs and Ezs, down 0.77% against late 2019. Since the beginning of 2020, around 120 enterprises in EZs and IPs were forced to suspend operations due to the pandemic, the majority of them were in southern industrial parks in Binh Duong and Dong Nai provinces. Vietnam currently has 336 industrial zones covering an area of nearly 97,800 hectares as of the end of May, of which 260 are operational, other 76 are in the process of site clearance and construction. The occupancy rate reached 76.1% at operating industrial parks. Additionally, the country has 17 coastal economic zones covering a combined area of approximately 845,000 hectares on land and water surface. Hanoi targets 11% increase in new businesses in 2020 Hanoi continues to pursue the dual target of containing the Covid-19 pandemic and boosting economic growth. Hanoi targets 30,000 newly established enterprises in 2020, representing an 11% increase from 27,000 in the previous year. This is one of the main priorities set by the Hanoi People’s Committee for the remaining six months of 2020, for which the capital city continues to pursue the dual target of containing the Covid-19 pandemic and boosting economic growth. Meanwhile, Hanoi would continue to hold goods demand–supply matching programs to promote domestic consumption. The municipal Department of Industry and Trade is tasked with organizing Hanoi’s sales promotion month in June and July. In preparation for the Hanoi’s investment promotion conference, scheduled to take place later this June, relevant agencies are requested to set up an investment portfolio for investment attraction. So far, organizers of the event have invited foreign ambassadors, business associations, enterprises and investors, among others. The Department of Industry and Trade would cooperate with local authorities in speeding up the approval process of new industrial parks in the city. The Department of Tourism is responsible for setting up plans to promote domestic tourism in 2020. Following the city’s second rank nationwide in the 2019 Public Administrative Reform (PAR) Index and a high score in the Satisfaction Index of Public Administration Services (SIPAS), Hanoi would continue to carry out drastic measures to maintain and improve respective scores. Starting from this year, Hanoi would publicize results of public satisfaction and administrative reform index of local agencies on an annual basis. Regarding the PAR Index 2019, Chairman of the Hanoi People’s Committee Nguyen Duc Chung said one of Hanoi’s highlights in improving the quality of public services is the publication of the guidance for administrative procedures on the portal of the local government. In 2019, Hanoi’s authorities processed 11.4 million applications on time, or 99.1% of the total, while the number in the first quarter of 2020 was 1.87 million, equivalent to a rate of 99.8%. Additionally, 1,421 out of 1,611 administrative processes are carried out online at advanced stages of three and four out of a four-level scale, or 89% of the total, of which 388 are at stage 4. To date, Hanoi has integrated 48 public online services into the national service portal, and an additional 200 are expected to follow suit by the end of June. This year, Hanoi expects an economic expansion rate at 1.3 times higher than the national average. Specific criteria needed for Vietnam to attract FDI into priority areas The quality of state management and administrative procedures are the top concerns of the business community, not only the progress of cutting red tape, said an expert. In addition to removing obsolete administrative procedures, Vietnam should issue specific sets of criteria to ensure greater efficiency in attracting foreign direct investment (FDI) into priority areas, according to Nguyen Anh Duong, head of the Macroeconomic Policy Department under the Central Institute for Economic Management (CIEM). “Low quality of institutional framework, digital infrastructure and productivity are three bottlenecks hindering Vietnam’s development in the post-Covid-19 period,” Duong said at a conference on June 1. Regarding this issue, economist Vo Tri Thanh, CIEM’s former vice director, said the Covid-19 pandemic has triggered the trend of politicization of economic activities, which was best demonstrated by the US – China tensions and protectionism. Thanh said in a world of growing uncertainties, countries like Vietnam should adopt flexible policies and act fast to grasp a new wave of investment capital as foreign investors are looking to diversify their global value chains away from China. “It is not a coincidence that Prime Minister Nguyen Xuan Phuc has set up a task force to promote investments in the country,” Thanh added. “Instead of waiting for others to come, we have to be active in approaching potential investors and addresses bottlenecks in attracting FDI,” Thanh asserted. Thanh, however, noted that while Vietnam is pursuing higher quality FDI, it is essential to continue to support the private sector, saying this would help make a strong and independent economy. Dau Anh Tuan, director of the Legal Department at the Vietnam Chamber of Commerce and Industry (VCCI), said the initial success in tackling Covid-19 proved the country’s stable business environment and efficient state governance. Tuan noted as the EU – Vietnam Free Trade Agreement (EVFTA), the EU’s only second trade agreement to date in the Southeast Asian region, is set to come into play, Vietnam is holding major advantages to attract investors compared to regional peers. However, as the Covid-19 pandemic is transforming the world, Vietnam has to move fast, he stated. “Vietnam should shift its focus from addressing business concerns to creating a favorable environment for growth,” Tuan added. Improving the quality of state management and smoothing administrative procedures are highly demanded by the business community, not only the progress of cutting red tape, Tuan continued. Disbursement of FDI in Vietnam in May is estimated at US$1.55 billion, the highest monthly figure since February, a report of the Foreign Investment Agency (FIA) under the Ministry of Planning and Investment has shown. The data indicates a positive sign that foreign investors are accelerating their projects’ progress as the Covid-19 pandemic has been initially contained in Vietnam. Overall, disbursement of FDI projects in Vietnam totaled US$6.7 billion in the first five months of 2020, representing a decline of 8.2% year-on-year. Meanwhile, FDI approvals in the January – May period fell 17% year-on-year to US$13.9 billion. The figure, however, is higher than that of the same five-month period from 2016 to 2018, posting increases of 37.6%, 14.8% and 40.4% compared to the corresponding period of 2016, 2017 and 2018, respectively. PV Gas’s Jan-May revenue surpasses goal despite pandemic The PetroVietnam Gas Corporation (PV Gas), a subsidiary of the Vietnam Oil and Gas Group (PetroVietnam), reported nearly 27.6 trillion VND (1.18 billion USD) in revenue between January and May, more than 6 percent higher than its target for the period. Pre-tax profit stood at over 4.5 trillion VND, exceeding the target by 34 percent. It also contributed close to 2 trillion VND to the State budget, 62 percent higher than expected. According to PV Gas General Director Duong Manh Son, its operations were impacted by the COVID-19 pandemic triggering a fall in oil prices. PV Gas has made every effort to sustain its business, reduce inventory, and clear several construction hurdles, he said. As such, the company produced and distributed nearly 3.8 billion cubic metres of gas in the first five months of this year, meeting its target. Production and distribution of LPG and condensate stood at 720,000 and 26,000 tonnes, respectively, 41 and 10 percent higher than targeted./. Binh Thuan to roll out tourism stimulus measures South-central Binh Thuan province will further promote its image as a tourism destination, with particular attention being paid to safety in association with the COVID-19 epidemic, in an effort to revive a local tourism industry severely affected by the pandemic. Efforts will also be made to step up cooperation and links between businesses and localities as well as between the tourism sector and other sectors, Ngo Minh Chinh, Director of the provincial Department of Culture, Sports and Tourism, told a meeting on June 4. From now to the end of this year Binh Thuan will host a range of events to attract visitors, including the Kate Festival, the most important annual celebration of the ethnic Cham Brahman community, cuisine festivals, and beach sports. All tourist sites are expected to reopen in July to meet travel demand during the summer holidays, Chinh said. Delegates at the meeting discussed other measures to boost local tourism, such as improving the quality of staff and introducing joint tourism packages. Binh Thuan earlier launched a major promotional programme called “Oh Wow Mui Ne” that offered 1 million VIP cards with discounts of up to 50 percent and valid until 2023. According to the provincial Department of Culture, Sports and Tourism, Binh Thuan has welcomed about 1.4 million tourists so far this year, reaching 20 percent of its annual target. It has earned 3.73 trillion VND (160 million USD) from tourism, down 50 percent year-on-year. Last year it welcomed more than 6.4 million tourists, including 775,000 foreigners, up 11.39 percent against 2018. Revenue from tourism stood at more than 15.1 trillion VND, a year-on-year increase of 17.5 percent. It also attracted six additional tourism projects in 2019, raising the number of valid projects in the sector to 383 with total registered capital of more than 59 trillion VND. Among them are 24 foreign-invested projects valued at over 561 million USD. Binh Thuan province is currently home to 550 accommodation facilities with 16,500 rooms./. Indonesia’s real estate revenue down 70 percent Secretary General of the Association of Housing Development of Indonesia (Peurmahan) Daniel Djumali has announced that revenue in the country’s real estate market this year has slumped by 70 percent year-on-year due to the COVID-19 pandemic. The latest report from Peurmahan showed that demand for high-end housing fell 40-70 percent against 2019 while demand for low-end housing was down 20-25 percent. Property developers are expecting a recovery in low-end housing to save the market, it noted. Developers have switched to online selling and offered preferential packages for buyers. Banks have also offered preferential loans to low-income buyers to make it easier for them to access the market./. Over 795.6 mln USD worth of Gov’t bonds raised in May The State Treasury raised over 18.39 trillion VND (795.6 million USD) worth of Government bonds via 16 auctions on the Hanoi Stock Exchange in May, up 510 percent from last month. Up to 70.3 percent of bidders won. Interest rates of bonds increased on all maturities, ranging from 0.22 – 0.4 percent each year. On the secondary G-bond market, the average trading volume surpassed 9.2 trillion VND per auction, up 32 percent month-on-month. Transacted volumes through repurchasing agreements (repos) accounted for 32.6 percent of the total trading volume. The total outright purchases of G-bonds in the month hit over 1 billion valued at more than 124 trillion VND, up 94 percent in value month-on-month. The total volume via repos reached over 558 million bonds, or more than 60.5 trillion VND, down 20.6 percent from the previous month. Foreign investors made outright purchases of over 6.6 trillion VND, outright sales of more than 4.8 trillion VND, and no repos deals. During the month, they bought bonds with a total value of over 1.8 trillion VND. As of May 31, Government bonds worth over 1.13 quadrillion VND were listed on the HNX./. Conference discusses division of regions for 2021-2030 Deputy Prime Minister Trinh Dinh Dung chaired a conference on June 4 on proposed plans for the division of regions in the country in the period 2021-2030 serving the development of regional planning in accordance with the Law on Planning. The Ministry of Planning and Investment has proposed two plans to the Government, one of which divided the country into seven regions, which are the northeast (7 provinces), northwest (7 provinces), Red River Delta (11 provinces and cities); north central (5 provinces); south central (comprising south central coastal areas and the Tay Nguyen Central Highlands); southeast (8 province and cities) and Mekong Delta (13 provinces and cities). The second plan, which is based on the Deputy PM’s instruction, proposed keeping the six current regions and dividing the north central and central coastal region into two regions – the north central and south central. Under this plan, which received support of 10 out of 14 ministries and sectors, and 49 out of 59 localities, the seven regions would comprise of the northern mountainous region (10 provinces); Red River delta and midland region (15 provinces with the addition of 4 more provinces - Hoa Binh, Phu Tho, Thai Nguyen and Bac Giang); north central region (5 provinces from Thanh Hoa to Thua Thien-Hue); south central region (8 provinces from Da Nang to Binh Thuan); Tay Nguyen Central Highlands (5 provinces); southeast region (6 provinces and cities) and Mekong Delta region (13 provinces and cities). Most experts also favoured the second plan. Deputy PM Dung said region division is of special importance in the national planning system. He said the division should be based on similarities in geographic and natural conditions, socio-economic situations, culture and ethnicity in order to bring into full play the potential and advantages of each region for development. Dung instructed the Ministry of Planning and Investment to study and sum up opinions at the conference and make a report to submit to the Government./. Thailand to launch major domestic tourism stimulus programme The Thai Finance Ministry has agreed with a plan to launch a major domestic tourism promotion next month by giving 2,000-3,000 THB vouchers to 4 million people and free trips to 1.2 million medical personnel. The campaign is aimed at boosting the economy and reviving the tourism sector, said the Bangkok Post quoted Tourism and Sports Minister Phiphat Ratchakitprakarn as saying. According to the minister, the Finance Ministry agreed to the scheme proposed by the Tourism and Sports Ministry. Under the promotion, one million tourism vouchers will be allocated to each of the country's four regions on a first-come first-served basis. Krungthai Bank will develop an app to support the registration and the allocation of the vouchers, which will be provided between July and October. While the government has reopened many more businesses and activities under its third phase of easing of the countrywide lockdown, the tourism sector remains a laggard as many tourists are still hesitant about travelling. Phiphat said the two ministries will finalise the overall budget and details of the scheme and the finance minister will submit it for cabinet approval later this month. Tourism Authority of Thailand (TAT) governor Yuthasak Supasorn said the scheme called Tiew Pun Suk (trips to share happiness) will focus on Thais planning to take inter-provincial trips between July and October. They would have to register using the app to buy hotel vouchers first. Upon checking in with the vouchers, the government would give a cash rebate to spenders via an electronic wallet and tourists could then use that money to spend on rooms, restaurants, spas or souvenirs. The thank-you gift for 1.2 million medical personnel such as village health volunteers and subdistrict health promotion hospital workers is to encourage them to take trips of up to three days using local tourism operators. Yuthasak said the overall budget now is about 8-12 billion THB but if the Finance Ministry would like to expand the number of recipients to more than the 4 million people and 1.2 million medical personnel currently planned, the budget could go up./. HCM City strives to perform dual task in post-COVID-19 period Chairman of the Ho Chi Minh City People’s Committee Nguyen Thanh Phong has requested more efforts to perform the dual task of recovering the economy while fighting COVID-19. During a conference held on June 4 to launch the city’s socio-economic tasks during the month, Phong said short-term measures will help businesses survive in the market in the first stage. Later, the city’s economy and market will be restructured to serve post-pandemic development. About long-term policy, the city will optimise public investment by fiscal measures, ensure social welfare for all citizens and prevent workers from losing their jobs. Also in June, the city will basically deal with existing problems in Thu Thiem new urban area project in accordance with the Government Inspectorate’s conclusions, he said. According to the municipal Department of Planning and Investment, the total retail of goods and services in the city surpassed 506 trillion VND (22 billion USD) in five months of this year, down 4.9 percent year-on-year. The city’s industrial production index went down 7.16 percent annually. However, its exports rose by 6.3 percent yearly to about 17 billion USD, mostly thanks to increases in earnings of computers, electronics and spare parts, vegetables and fruits. The output of agro-forestry-fisheries topped 5 trillion VND during five months, up 2.2 percent year-on-year. Among four key industries, electronics grew by 11.83 percent while chemicals, rubber and plastics expanded by 8.37 percent./. Malaysia posts first trade deficit after 22 years Malaysia recorded its first monthly trade deficit since October 1997 as exports contracted faster than imports. Data from the country’s Department of Statistics on June 4 showed that exports in April fell 23.8 percent from the same period a year earlier to 64.9 billion ringgit (about 15.18 billion USD), the steepest decline since the global economic crisis in 2009. Most of the country’s economic sectors were forced to close since the enforcement of the Movement Control Order on March 18. Meanwhile, imports slipped 8 percent to 68.4 billion ringgit in the reviewed period. Imports from Singapore saw the strongest decrease of 2.5 billion ringgit, followed by those from the European Union (2.1 billion ringgit), Thailand (1.7 billion ringgit) and Saudi Arabia (1.6 billion ringgit) Malaysia's total trade value amounted to 133.34 billion ringgit in April, down 15.4 percent year-on-year and 9.9 percent compared to the previous month. The country's balance recorded a deficit of 3.5 billion ringgit in the month, after 269 consecutive months of surplus./. HCM City supports workers, businesses affected by COVID-19 The southern economic hub of Ho Chi Minh City has spent 465 billion VND (20.2 million USD) supporting more than 336,550 business households and employees seriously affected COVID-19, according to Director of the municipal Department of Labour, Invalids and Social Affairs Le Minh Tan. Speaking at a press conference on June 4, Tan reported that 47,533 workers of 2,862 enterprises in the city are being laid off as a result of the pandemic. Local authorities have provided assistance for 20,000 employees, he said. Earlier, Chairman of the municipal People’s Committee Nguyen Thanh Phong had requested more efforts to perform the dual task of recovering the economy while fighting COVID-19. He said short-term measures will help businesses survive in the market in the first stage. Later, the city’s economy and market will be restructured to serve post-pandemic development. About long-term policy, the city will optimise public investment by fiscal measures, ensure social welfare for all citizens and help workers keep their jobs, he added. According to the municipal Department of Planning and Investment, the total retail of goods and services in the city surpassed 506 trillion VND in the first five months of this year, down 4.9 percent year-on-year. The city’s industrial production index went down 7.16 percent annually. However, its exports rose by 6.3 percent yearly to about 17 billion USD, mostly thanks to increases in earnings from computers, electronics and spare parts, vegetables and fruits. The output of agro-forestry-fisheries topped 5 trillion VND during the five months, up 2.2 percent year-on-year. Among four key industries, electronics grew by 11.83 percent while chemicals, rubber and plastics expanded by 8.37 percent./. Bac Giang developing hi-tech agriculture to foster economic growth The northern province of Bac Giang will continue investing in, developing, and duplicating hi-tech agricultural production models, Director of the provincial Department of Agriculture and Rural Development Duong Thanh Tung has said. It will step up research and application activities, transfer scientific and technical advances, mechanise and automate production phases, and apply more advances in seedlings and breeding, advanced production processes, green and organic technologies, and bio-products, he added. The province will also expand technological application in technical transfer, production management, and trade promotion, while building brands and expanding consumption markets for local farm produce. Attention will be paid to concentrated cultivation areas and upgrading infrastructure to serve product semi-processing, processing, preservation, and consumption, he stated. In the time to come, he went on, Bac Giang will expand the cultivation area that follows VietGAP and GlobalGAP standards, strengthen State management over agricultural materials, and strictly control the use of additives and banned substances in the production and preservation of farm produce. The province is encouraging the engagement of the collective economy in hi-tech agricultural production, with priority given to the development of cooperatives. After five years implementing the provincial Party Committee’s Resolution No. 130-NQ/TU dated August 16, 2016, Bac Giang has mobilised 593 billion VND (25.5 million USD) from different sources to invest in hi-tech agriculture. The investment has proven effective, contributing to increasing the productivity, quality, and value of agricultural products as well as raising local incomes. A total of 716 hi-tech agricultural models have been built. Many local agricultural products now meet VietGAP and GlobalGAP standards and have become popular in the domestic market and shipped to other countries, such as lychee, vegetables, chicken, and pork. The value of agricultural production with hi-tech application averages 220-250 million VND per hectare per year, or 2-2.5 times that of the traditional production. Of note, safe vegetable farms in Yen Dung, Lang Giang, Hiep Hoa, and Luc Nam districts enjoy an average annual production value of 500-800 million VND per hectare. High-quality flower production models in the provincial capital of Bac Giang city, which have consumption links with businesses and cooperatives, earn revenue of 3-5 billion VND per hectare per year, or 2-3 times that of normal planting. Meanwhile, each hectare at orange orchards in Luc Ngan district that apply VietGAP production processes records average annual turnover of 500-700 million VND. The most outstanding is a 5-ha farm belonging to Bui Duc Long in Hong Giang commune, which records annual revenue of 5.4 billion VND. Using drip irrigation technology, biological fertiliser, and pesticides and following VietGAP standards, a tea production model in Yen The district also enjoys a 20-30 percent annual increase in productivity and revenue. The success of the model helped expand the district’s tea growing area to 530ha, with a combined output of over 4,300 tonnes a year. Bac Giang has also applied VietGAP and GlobalGAP standards in cultivation on 39 percent of fruit orchards and used QR Codes for tracing product origin, together with the smart weather station iMetos, the VietGAP app, and drip irrigation technology. The province has recently expanded its VietGAP-standard lychee coverage to 14,300ha and its GlobalGAP-standard coverage to 258ha. It also has 218ha of lychee with cultivation codes granted for export to the US, Australia and the EU. Bac Giang is growing 50ha of lychee this year that meet requirements for export to Japan. Lychee orchards following VietGAP and GlobalGAP standards have an average productivity 20-30 percent higher and an average price 2-3 times higher than those using traditional cultivation methods./. Seminar discusses Da Nang’s development programmes The People’s Committee of the central coastal city of Da Nang organised a seminar on June 3 to discuss the implementation of its “Five No’s”, “Three Yes’s”, and “Four Safety” programmes aimed at ensuring the city’s path towards sustainable development. According to a report from the committee, the city has recorded positive outcomes after 20 years of implementing the “Five No’s” programme, which targets “no hunger, no illiteracy, no homelessness, no addiction, and no crime”. After two years of implementation, the city had basically eradicated hunger and changed the objective to “no extremely poor households”. In the process it selected 6,000 extremely poor households and designed specific policies and mobilised resources to support them. Such households no longer exist in the city. Da Nang has also changed its “no illiteracy” objective to “no children dropping out of school”, thus ensuring general education for all local kids. It has also adopted drastic measures to ensure there are no beggars on its streets and to minimise drug addiction and crime. In addition to the “Five No’s” programme, the city also launched its “Three Yes’s” programme - ensuring housing, employment, and a civilised urban lifestyle - in 2005. Over the 15 years since, it has focused resources on building student dorms and accommodation for workers. With the successful implementation of the “Five No’s” and “Three Yes’s” programmes, Da Nang also launched the “Four Safety” programme, targeting social order, traffic safety, food hygiene, and social security. Five years on, it has addressed issues in terms of traffic accidents and food hygiene. Participants at the seminar shared ideas and discussed directions and changes to objectives in the programmes to make them more suitable with the existing circumstances. Vice Chairman of the committee Le Trung Chinh said that with the successful implementation of the three programmes, Da Nang will maintain suitable objectives while adding others. The “no children dropping out of school” programme will be updated to “no children being abused in families or at school” or “no abuse or violence against women and children”. For the “Three Yes’s” programme, Da Nang will continue implementing “housing” while reconsidering “employment”, which could be included in other social security programmes. The city will continue its “Four Safety” programme to further the outcomes from the past five years./. Thai Cabinet slashes 2020 property tax by 90 percent The Cabinet of Thailand has approved a reduction in Land and Building Tax this year of 90 percent to help ease economic disruption from the COVID-19 pandemic. Meanwhile, schools across the country will open on July 1, with the Ministry of Education preparing contingency plans in case of emergencies. Prime Minister and Minister of Defence Gen Prayut Chan-o-cha has revealed the outcome of the investment enhancement among other aspects, as the country enters the New Normal. The Cabinet approved a 90 percent reduction in the Land and Building Tax this year to help the general public cope with economic disruption from COVID-19, and prevent potential issues with land and building taxation in the future. The government has pushed back the tax filing deadline to August, and will be holding further discussions with local authorities on local tax collections. On the reopening of schools, the Prime Minister has confirmed the new academic year for schools will start on July 1 this year, and continue until May 2021, with additional classes to be held to make up for lost hours. Schools may implement online and remote learning, which must be regulated under clear guidelines. The government has evaluated previous developments to make plans for different scenarios, which include changes to remote classes on TV or online, for primary and junior high school students should the outbreak worsen. Schools can open while the situation remains under control, albeit with strict health and hygiene measures, and contingency plans for cases of emergency. The government has declared that all Ministry of Education disbursements must cover students and educational staff, and the establishment of a committee taking care of underprivileged or disabled students, who may require financial support./. Vietnam striving to boost export growth over remainder of 2020 Vietnam exported goods with an estimated value of 99.36 billion USD in the first five months of 2020, a year-on-year decline of 1.7 percent. Export turnover of domestic businesses maintained double-digit growth, however, of 10.4 percent, reaching 33.3 billion USD. The outcome is considered a highlight of goods exports since early in the year, especially given that the export turnover of the FDI sector fell 6.9 percent year-on-year due to the impact of COVID-19, according to trade experts. The US remained Vietnam’s largest market in the first five months, with turnover of 24.6 billion USD, up 8.2 percent, followed by China, the EU, ASEAN, Japan, and the Republic of Korea. From January to May, Vietnam posted a trade surplus of nearly 1.9 billion USD - a much better result than the trade deficit of 256 million USD in the same period last year. The figure is encouraging amid the pandemic, which has seen restrictions placed on a number of trade activities at border gates with China. Many other markets, like Europe, the US, ASEAN, and the Middle East, meanwhile, have applied movement restrictions, affecting Vietnam’s trade activities. The Ministry of Industry and Trade said it has considered the implementation of trade promotion methods to pave the way for farm produce and processed food to go to China and India. Furthermore, Vietnam is expected to ratify the EU-Vietnam Free Trade Agreement (EVFTA) on June 8 and this will create momentum for national economic recovery and be a positive sign for exports in the time to come. Deputy Minister Cao Quoc Hung said his ministry will prepare scenarios to develop markets according to groups of products with local advantages, to make inroads into the EU and markets Vietnam has signed FTAs with./. Malaysia recovers economy with solar power projects The Malaysian Ministry of Energy and Natural Resources (KeTSA) has opened a bidding process for the Large Scale Solar (LSS) programme to create momentum for the national economy post-COVID-19. Minister Datuk Dr Shamsul Anuar Nasarah said some 1,000 megawatts (MW) of solar quota has been offered through the bidding process since March 31 that is open to local companies or those with at least 75 percent local shareholding. The move is aimed at reviving and stimulating the economy that is affected by the COVID-19 pandemic, while spurring the development of the nation's electricity industry, especially renewable energy, he said. He said the ministry expects to attract investments totaling 4 billion RM (nearly 1 billion USD) and generate 12,000 job opportunities for Malaysians. The quota offered this time is the biggest under the LSS programme as during LSS-1 some 370MW solar were offered; LSS-2,520MW; and LSS-3, 500MW./. Bac Giang plans promotional events to boost lychee exports The northern province of Bac Giang is planning a series of promotional events as this year’s peak harvest season nears, to promote and boost the export of its specialty lychee amid the COVID-19 pandemic. The province will host a video teleconference on June 6 to link with 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. After the conference, a ceremony will be held at February 3 Square in the provincial capital of Bac Giang city for a fleet of trucks carrying lychee to depart to other localities and overseas. Luc Ngan and Tan Yen districts, home of the largest lychee areas in the province, is preparing a list of foreign wholesalers with demand for lychee and seeking permission from authorities to allow their entry into Vietnam to purchase the fruit. They will also formulate plans to quarantine the traders, in line with regulations. Bac Giang currently has more than 28,100ha of lychee, with output likely to increase 10,000 tonnes to 160,000 tonnes this year. This includes 45,000 tonnes of early-ripened lychee harvested on an estimated area of 6,000ha and 115,000 tonnes from the main crop, on an area of 22,100ha. The harvest of the early-ripened lychee is expected to last to June 10 while that of the main crop will fall from June 10 to July 10. VietGAP-standard lychee has been grown on 15,000ha 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 a host of plans and scenarios for lychee trade promotions this year given 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 103ha of lychee grown by 107 local households in Bac Giang. The area includes 98ha of the main crop in Luc Ngan and 5ha of the early-ripened crop in Tan Yen, which is forecast to produce over 600 tonnes. The province has also received 18 PUCs for 218ha of lychee in Luc Ngan’s six communes - Giap Son, Tan Moc, Tan Son, Hong Giang, Kien Lao, and Tan Quang - for export to the US, Australia, and the EU. The area is expected to generate more than 1,000 tonnes of high-quality lychee for export to these markets. The provincial Department of Agriculture and Rural Development has worked with the People’s Committees of Luc Ngan and Tan Yen districts to monitor production units and support local farmers to engage in production links. It has also cooperated with the Plant Protection Department to help the Global Food JSC, a local food exporter, install a closed system for post-harvest preliminary processing, classification, sterilisation, packaging, and storage that meets Japanese standards. A trial shipment headed to Japan at the end of May./. Trading centres assess COVID-19 risks, take safety measures Supermarkets, shopping centres and traditional and wholesale markets in HCM City have assessed their Covid-19 infection risks through a set of evaluation indicators and have set safety measures to meet city requirements. The city’s Steering Committee for COVID-19 Disease Prevention and Control launched the assessment tool as part of a programme to help local businesses reopen. The city’s Department of Industry and Trade provided assessment guidance to people's committees in all 24 districts and to management boards at wholesale markets, traditional markets, supermarkets and trading centres. The department also worked with the Department of Information and Communications to inform residents about shopping places that meet the requirements for reopening. So far, three wholesale markets, 216 supermarkets and 40 trading centres have sent their self-assessment reports to the department. People's committees in 24 districts have reported that 196 out of 197 traditional markets have met the safety requirements. Đình Market in Hóc Môn District is taking measures to overcome its shortcomings. From April 28 to May 7, the Department of Industry and Trade in collaboration with people's committees in 24 districts checked 17 places to ensure they were applying safety measures. Most of the places met 80 per cent of the requirements for operation. More than 85 per cent of enterprises in the city have been affected by the pandemic, including 87 per cent of businesses in the retail sector, according to the city’s Statistics Office. In the first five months of the year, total retail sales of consumer goods and services have been estimated at VNĐ506 trillion (US$21.7 billion), a decrease of 4.9 per cent compared to the same period last year. Of the figure, retail sales of goods in the first five months has been estimated at VNĐ331 trillion ($13.4 billion), a year-on-year increase of 8.4 per cent, accounting for 65 per cent of total retail sales of consumer goods and services. Retail sales of goods are recovering, but are still slow because purchasing power and rental demand have been affected. Purchasing power increased by 10-15 per cent after the social distancing order was relaxed, with a higher increase at retail channels such as supermarkets, hypermarkets and convenience stores. In the second quarter, retail and distribution systems have launched promotion campaigns to promote purchases through mobile phones, websites and apps, and have offered attractive delivery policies. The shift from traditional offline channels to online sales has helped businesses improve revenue. Indonesia postpones import reduction deadline amid COVID-19 The Indonesian government has pushed back the deadline to achieve its import reduction target by a year as the COVID-19 pandemic has affected productivity and demand of industries. According to Indonesian Minister of Industry Agus Gumiwang Kartasasmita, his ministry has decided to delay the deadline to reduce imports by 35 percent from 2021 to 2022. The ministry is coordinating with other ministries to set up a comprehensive roadmap to reach the target. In 2019, the government announced seven industry sectors that are prioritised for the import reduction programme, including the automotive industry, textiles, food and beverages, electronics, petrochemicals, medical equipment manufacturing, and pharmaceuticals. However, the programme was hampered by the downturn of domestic industrial production capacity, which stands at around 25-30 percent of its maximum capacity as a result of the pandemic./. |
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Ample space for boosting exports of processed agricultural products 02:12 Vietnam exported 166 million USD worth of processed agricultural products in the first quarter of 2020, up 33 percent year-on-year, statistics reveal.
Rosy signs for processing industry Dried fruit, especially mango, and passion fruit juice generated the largest export value, the Ministry of Industry and Trade (MoIT) has reported. The positive growth is down to growing investment in the processing industry over recent years, with up to 30 major projects on processing farm produce, valued at about 1 billion USD, implemented during the 2018-2019 period, according to Dang Phuc Nguyen, Secretary General of the Vietnam Fruit and Vegetables Association (Vinafruit). Unlike other sectors, processed fruit and vegetables have not been overly impacted by COVID-19 because of their convenience and longevity, he added, suggesting that exports of such products be boosted in order to raise revenue. The Ministry of Agriculture and Rural Development (MARD) said the export value of processed agricultural products is rising 7-8 percent annually and more than half of processing facilities for major agricultural exports have been equipped with cutting-edge technologies. There have been production, preservation, processing, and consumption clusters for agricultural products along with concentrated material areas, contributing to spurring rural economic development, building new-style rural areas, and generating jobs for farmers. It is noteworthy that Vietnam has signed several new-generation free trade agreements (FTAs) that enable it to expand farm produce exports, especially processed products. However, existing processing technologies for only a few items like cashew nuts, coffee, rice, shrimp, and tra fish, meet regional and international standards, MARD added. Looking at fastidious markets Many Vietnamese companies are yet to secure the supply of materials while linkages in the value chain from production, processing to consumption have remained loose. Nguyen Lam Vien, Chairman of dried fruit producer the Vinamit JSC, said a number of businesses have invested in modern processing plants and focused on brand development. Developing material areas, however, has remained a headache, he added, explaining that most agricultural companies do not possess fertile land in favourable geographic locations. Nguyen from Vinafruit said, however, that the fruit and vegetable processing sector is indeed moving forward, and will be even better placed once the EU-Vietnam FTA (EVFTA) takes effect. Local firms need to prepare standardised material areas in response to strict technical barriers in the EU market, he suggested, pointing to competition with neighbouring countries that have invested in technologies and stepped up the import of Vietnamese agricultural products to serve the export of processed products to the EU. The State and enterprises therefore need to encourage farmers to join cooperatives to create large-scale fields and boost mechanisation. “We can attract investment from the US, Japan, the Republic of Korea, Australia, and Israel, to promote intensive processing technologies,” Nguyen said. MARD is now completing a draft project on developing the fruit and vegetable processing industry, with Vietnam targeting a place among the world’s top five countries in the sector. To that end, Nguyen proposed quickly rolling out solutions such as preferential loans for agriculture, duplicating large-scale fields, establishing links between businesses and farmers, and building processing plants combined with material areas. |
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BUSINESS NEWS HEADLINES JUNE 1002:27 PM okays new industrial park project in Binh Phuoc The Prime Minister has agreed that work can begin on the development of Ledana Industrial Park in Binh Phuoc Province. Nguyen Xuan Phuc has issued Decision 738/QD-TTg giving the green light to the five-year project. The industrial park will cover a total area of 424.5ha in Loc Ninh District’s Loc Thanh Commune. Le Dai Nam International JSC is the project investor. Total investment for the development is VND1.2 trillion (US$51.5 million), including VND200 billion provided by the investor. The provincial People’s Committee and Binh Phuoc Economic Zone Management Unit will work with the investor to complete the Industrial Park in a maximum of five years. The investor has been told to strictly follow construction rules and provide guarantees to prove the company is financially capable to carry out the work. The company is required to introduce different plans to raise enough capital, assuring its capability of financing the project. In addition, environmental protection tasks must be accomplished in the investor’s environmental impact assessment when preparing for the project. Binh Phuoc provincial People’s Committee and the Economic Zone Management Unit are asked to oversee the project development regarding the progress, environmental protection, and land and water use. The agencies are also tasked to clear land and develop a settlement plan for affected people. Deputy PM: VNAT and localities focus on developing regional tourism activities
The Viet Nam National Administration of Tourism (VNAT) needs to coordinate with local administrations and the Viet Nam Tourism Association (VITA) to advertise tourism destinations in the northwestern, northeastern and central coastal regions. Deputy Prime Minister Vu Duc Dam made this request during a meeting with the Ministry of Culture, Sports, and Tourism, Ministry of Transport, Ministry of Finance, Viet Nam Tourism Association (VITA) and several travel firms in Ha Noi on Wednesday to help the tourism industry weather the COVID-19 pandemic. The Deputy PM also requested relevant ministries to soon set the schedules for this year’s upcoming public holidays and school summer break to boost domestic travel demand. Viet Nam has more than 40,000 businesses and about 4.5 million people working in the tourism industry, one of the sectors hardest hit by the COVID-19 pandemic, he said. Many small-size tourism enterprises have been put under great pressure by the outbreak so the government must find ways to re-energise them, he said. Dam noted that though small firms like community-based tourism and homestay service providers are not large contributors to the State budget, they have played a crucial part in reducing poverty and improving living standards in remote and disadvantaged areas. The Deputy PM asked the relevant ministries, agencies and local administrations to slash fees for hospitality firms fairly to help them overcome difficulties. He also suggested to the stakeholders to organise more virtual international travel promotion events and develop tourism programmes to promote Viet Nam as a safe destination amid COVID-19. “At present, the promotion of domestic tourism activities is important. This is also the choice of many countries with tourism advantages in the context of suspended international tourism due to the pandemic," said Nguyen Trung Khanh, VNAT general director. According to VNAT, to remove the current difficulties of the tourism industry, the Government is requested to permit the Ministry of Culture, Sports and Tourism and relevant ministries to implement the communication programme "Viet Nam - safe and attractive destination". In addition, the Government should have support for local tourism businesses. Of which, the Ministry of Industry and Trade should adjust electricity prices for tourist accommodation establishments to be at the same rates as electricity prices for production. This adjustment should be applied until the end of this year. At the meeting, Nguyen Quoc Ky, Vietravel general director, said the Government should have policies to attract domestic tourists in the peak period from July to October. It also needs to build key tourism regions for promoting tourism development in each region and regional links, and develop a tourism product chain connecting travel, aviation and service enterprises. Those activities would aim at stimulating tourism in the domestic market, he said. Ky proposed the Government to have financial support for travel companies, the leading factor in the chain of tourism development, including transportation, accommodation and services. He suggested a reduction in entrance fees at historical relic sites and tourist attractions managed by the State until the end of March 2021. Regarding these fees, VITA vice-chairman Vu The Binh said many localities have not offered discounts for tourists. "The price is not reduced much, but the reduction is localities' action to share the current difficulties with businesses of the tourism industry. These enterprises have discounted hotel prices and travel costs,” Binh said. According to VITA, international tourist arrivals to Viet Nam in the first five months of this year totalled 3.7 million while the number of domestic holidaymakers stood at 16 million, down 50 per cent and 58.5 per cent, respectively, from the same period last year. The total tourism revenue during this period reached VND150.3 trillion, a reduction of 47 per cent compared to the same period in 2019. Average room occupancy reached about 20 per cent, a sharp decrease compared to 52 per cent in the same period in 2019. Seminar calls for farm production, consumption link-ups within southern economic hub Localities in the Southern Key Economic Region need to enhance co-operation to develop safe agricultural areas and ensure consumption of safe food and farm produce, a seminar heard in HCM City yesterday. Nguyen Huynh Trang, deputy chairman of the city Department of Industry and Trade, said linkages for production and consumption of agricultural products and foods is important for promoting economic development in the region and the application of good agricultural practices. As the chair of the Southern Key Economic Region Council, the city has assigned the HCM City University of Economics in collaboration with the city Department of Industry and Trade, and partners to develop a project named "Building linkages in production and consumption of agricultural products and foodstuffs towards ensuring food safety standards between HCM City and provinces and cities in the Southern Key Economic Region." The seminar sought to collect participants’ opinions on zoning areas for safe agricultural produce and foodstuffs and suggest policies for localities in the region for building linkages in production and consumption of agricultural produce and foods from the region, she said. Tran Tien Khai, representative of the project’s executive board, said, “The provinces and city in the region have not established close links with each other for formulating production plans locally, and do not share information about market and demand to balance supply and demand.” Localities in the region have enhanced food safety management and adopted VietGAP standards for cultivation and animal breeding, but only 5-10 per cent of the products meet those standards. “Farmers have sufficient knowledge to apply VietGAP standards in their production and awareness of safe food production, but many of them do not apply them.” The cost of growing vegetables to VietGAP standards is higher than conventional methods, while productivity is lower and the appearance of the vegetables is not very attractive, he said. Modern distribution channels can buy around 20 per cent of vegetables grown to VietGAP standards. So farmers have to sell the rest at traditional markets at normal prices, which discourages them from adopting the standards, he said. “Farmers usually care about short-term benefits over long-term and sustainable benefits.” He suggested that localities should make plans for safe farm produce production and consumption as well as expand the application of VietGAP standard in production. Nguyen Ngoc Hoa, another representative of the project’s executive board, said the region has about 21-22 million consumers with increasing income. With the consultancy and consensus of provinces in the region, HCM City should preside building a zoning plan on safe farm produce production and trade within the region so that each province in the region will base on that to make plan for its local production and trade. “HCM City is the largest market in the region, consuming about 50-60 per cent of farm produce and food products manufactured in other localities. “Provinces all have demand to sell their products in the city and are willing to comply with regulations prescribed by the city.” Representatives of many provinces and cities in the region said building a wholesale market and centre for agricultural products and enhancing food safety management from the production to consumption stages are urgent requirements. They also called for enhancing traceability of products to ensure food safety. Producers must focus more on building brands for their products and improve product designs so that they could be exported, they added. The region, which consists of HCM City and seven provinces – Tay Ninh, Binh Phuoc, Binh Duong, Dong Nai, Ba Ria-Vung Tau, Long An, and Tien Giang -- plays a special role in the country’s socio-economic development, accounting for more than 45.5 per cent of its GDP. PetroVietnam’s oil equivalent output up in 5 months The Vietnam Oil and Gas Group (PetroVietnam)’s oil equivalent output reached 8.99 million tonnes in the first five months of this year, 4.4 per cent higher than its target. Of which, crude oil output in May reached 0.96 million tonnes, 2.1 per cent higher than the monthly plan, while gas production fulfilled the monthly goal at 0.84 billion cu.m, according to PetroVietnam. The firm generated 2.05 billion kWh of electricity and produced 149,800 tonnes of nitrogenous fertiliser, surpassing the monthly targets by 4.7 per cent and 4.2 per cent, respectively. Its production of oil and petroleum exceeded 1.01 million tonnes during the month, only equivalent to 91.5 per cent of the monthly goal, largely because the Nghi Son Oil Refinery was cutting capacity for maintenance and the PetroVietnam Oil Corporation (PV Oil) reduced production of petroleum as demand dropped. During the first five months, PetroVietnam followed fluctuations on the global and domestic markets to have reasonable solutions preventing the COVID-19 pandemic and also coping with difficulties in production and business due to the serious development of this disease. The group also built scenarios to deal with situations of the global oil price falling. Of which, the worst scenario was to stop operation of mines and refineries. PVN member companies shared information and resources and cooperated with other foreign and local partners to optimise operational efficiency in the PVN value chain. The company has also made drastic efforts to cut nearly VND8.7 trillion in costs during the first five months of the year. From January to May, the State-owned enterprise earned VND124.2 trillion (US$5.33 billion) in revenue, down 29 per cent from a year earlier. Its post-tax profit nosedived 49 per cent year on year to VND7.1 trillion. Pepper price hike in Cambodia attributed to high demand from Vietnam Increased demand from Vietnam has led to a significant recovery in Cambodia’s pepper prices at the beginning of this year’s harvest season, the Phnom Penh Post quoted Cambodia Pepper and Spice Federation president Mak Ny as saying. The prices of the spice rose from 9,000 riel to 11,000 riel (2.19 to 2.67 USD) per 550g compared to the same period last year, he said. According to Ny, the prices have soared since the beginning of May, while the harvest season in Vietnam ended in April. He assumed the harvest is low, raising concerns of a shortage, as Vietnam is a big market distributor. That’s why the country has bought a lot of pepper from Cambodia to stockpile, resulting in a price hike, he added. Ny said the prices of Cambodian pepper started to decline in 2018 and the local sector now relies 80 percent on the Vietnamese market and around 15 percent on the Thai market./. Bac Ninh authorities hold dialogue with workers Authorities in the northern province of Bac Ninh held a dialogue with workers on June 4 to listen to their inquiries and aspirations. The participants represent over 300,000 employees who are working at businesses across the locality. They touched upon difficulties caused by COVID-19 and issues relating to the implementation of social insurance; traffic safety, security and order at industrial parks; and environmental pollution. Addressing the workers’ concerns, Director of the provincial Department of Labour, Invalids and Social Affairs Dinh Van Duan said the province is assisting social welfare families, national revolutionary contributors, and needy people under the Government’s aid package worth 62 trillion VND (2.7 billion USD). Earlier, at a dialogue with Prime Minister Nguyen Xuan Phuc on the occasion of his visit to a sound device factory in the province’s Tu Son town, workers appreciated the Party and State’s efforts against COVID-19, as well as the Government’s aid package for people affected by the pandemic, including labourers. They expressed their hope that the Government will keep a good control of the disease, support businesses and export activities, and facilitate the building of housing, day-care centres and supermarkets to meet their daily needs. In response, PM Phuc said housing for workers is an issue that needs more attention. He asked the Vietnam General Confederation of Labour and Bac Ninh authorities to reserve more resources and provide more favourable mechanisms for the housing construction. He affirmed the Party and State always create the best possible environment for all domestic and foreign investors to operate successfully in Vietnam. Therefore, both enterprises and state agencies are responsible for developing a healthy business climate. Bac Ninh is a major industrial hub in the north of Vietnam, attracting large firms from Japan and the Republic of Korea./. Video meeting discusses Vietnam-Russia economic ties amid COVID-19 The Russian Academy of Sciences (RAN) and Vietnam’s National University of Economics (NEU) hosted a video conference on June 4 to discuss the Vietnam-Russia economic relations amid new challenges. The event, which marked the Vietnam Year in Russia and Russia Year in Vietnam, was attended by Chairman of the Vietnam National Committee for the Pacific Economic Cooperation Council (PECC) Vo Tri Thanh and experts from ministries and governmental agencies as well as leading universities and academies from both sides. In her opening remarks, Dr. Elena Lenchuk, head of the RAN’s institute of economy, said the event aims to mark the 70th anniversary of the two nations’ diplomatic ties. She spoke highly of the close cooperation between Vietnam and Russia, saying against the backdrop of globlisation and new global challenges, Russia is interested in strengthening relations with the Asia-Pacific, particularly Vietnam which has seen robust economic growths in recent years. A total of 14 presentations were delivered throughout three sessions of the event. The first session reviewed the main trends in the trade and investment cooperation between Vietnam and Russia over the last decade (2010 – 2020), the second discussed the bilateral relations which are being challenged by the COVID-19 pandemic, and the third was on declining global oil prices and the energy cooperation between the two sides. Seminar calls for farm production, consumption link-ups within southern economic hub Localities in the Southern Key Economic Region need to enhance co-operation to develop safe agricultural areas and ensure consumption of safe food and farm produce, heard a seminar in Ho Chi Minh City on June 4. Nguyen Huynh Trang, deputy chairman of the city Department of Industry and Trade, said linkages for production and consumption of agricultural products and foods is important for promoting economic development in the region and the application of good agricultural practices. The seminar sought to collect participants’ opinions on zoning areas for safe agricultural produce and foodstuffs and suggest policies for localities in the region for building linkages in production and consumption of agricultural produce and foods from the region, she said. Localities in the region have enhanced food safety management and adopted VietGAP standards for cultivation and animal breeding, but only 5-10 percent of the products meet those standards. The cost of growing vegetables to VietGAP standards is higher than conventional methods, while productivity is lower and the appearance of the vegetables is not very attractive, participants said. Modern distribution channels can buy around 20 percent of vegetables grown to VietGAP standards. So farmers have to sell the rest at traditional markets at normal prices, which discourages them from adopting the standards, they added, suggesting that localities should make plans for safe farm produce production and consumption as well as expand the application of VietGAP standard in production. Representatives of many provinces and cities in the region said building a wholesale market and centre for agricultural products and enhancing food safety management from the production to consumption stages are urgent requirements. They also called for enhancing traceability of products to ensure food safety. Producers must focus more on building brands for their products and improve product designs so that they could be exported, they added. The region, which consists of HCM City and seven provinces – Tay Ninh, Binh Phuoc, Binh Duong, Dong Nai, Ba Ria-Vung Tau, Long An, and Tien Giang -- plays a special role in the country’s socio-economic development, accounting for more than 45.5 percent of its GDP./. HCM City attracts 1.6 billion USD in FDI in first five months Ho Chi Minh City attracted a combined 1.6 billion USD in foreign direct investment (FDI) in the first five months of 2020, or 57.67 percent compared to the same period last year. The information was revealed during a conference on the city’s socio-economic development held on June 4. Of the 47 countries and territories investing in the southern hub, Japan was the top with 44 projects worth 80.5 million USD, holding a lion’s share of 32.4 percent in terms of additional capital. Singapore came second with a total of 50.8 million USD in registered capital, followed by Hong Kong (China) and the Republic of Korea. The city posted a budget collection of nearly 139.40 trillion VND (6 billion USD) during Jan-May, hitting 34.35 percent of the year’s estimates and 84 percent of the same period last year. Singapore imports Vietnamese litchi directlyfor first time Singapore has directly imported Vietnamese litchi for the first time. Ameii Vietnam JSC in the northern province of Hai Duong recently exported the first 6.5 tonnes of litchi to Singapore; while Rong Do Production, Trade and Services Co Ltd also shipped the first 20 tonnes of litchi to Australia and the US. Trinh Van Thien, chairman of Hai Duong Province’s Thanh Ha District, said that in previous years, Chinese traders used to come to Vietnam to buy litchi and then exported the product to neighbouring countries such as Malaysia and Singapore. Since February when the Covid-19-pandemic broke out, Singapore has sought to import farm produces from different markets due to being suspended by the supply from China. Southeast Asian markets such as Malaysia, Vietnam and Thailand are among the top priorities of Singapore. At a recent online meeting to boost Vietnam’s farm produce and seafood exports to Singapore, some Singaporean fruit importers expressed their interest in the high-quality litchi grown in Bac Giang and Hai Duong provinces. Vietnam News Agency cited Tran Thu Quynh, trade counsellor in Singapore, as saying that besides Vietnamese litchi imported by Chinese traders into Singapore, the market was importing litchi from Thailand and Taiwan, but the Singaporean market likes Vietnamese litchi due to their good taste. Strengthening trade promotion activities for Vietnamese litchi and Bac Giang litchi in particular in the Singapore market would be a good solution to increase Vietnamese litchi being directly exported to Singapore. This year, Bac Giang has 28,000ha growing litchi with an estimated total output of 160,000 tonnes. Meanwhile, Japan has granted area codes to 19 areas. China has granted area codes for 149 areas and export licenses for 288 packaging facilities in Bac Giang. Car prices predicted to fall until Tet Holiday Car prices in Vietnam are predicted to continue falling with many discount programmes due to large inventory and slow sales. It is estimated that up to 50,000 cars are left in the firms' inventories. Many of them are cars made in 2019 and 2018. Some firms have to search for more warehouses to store the cars. The oversupply situation has occurred since late 2019 and got worse during the Covid-19 outbreak. According to the Department of Industry, most firms have resumed operation after social distancing but at low capacity due to high inventories. Data from the General Statistics Office showed that a large number of the cars in inventory were assembled domestically. This has been the most difficult time yet for the local automobile industry. Moreover, domestically-assembled cars still have to compete with completely built-up imported cars from Thailand and Indonesia. The government has reduced the registration fee for new domestically-assembled cars by 50% for 2020 and extended the deadline for excise tax payments and other fees incurred since March. Decree 57 has been issued to help domestically-assembled cars have lower prices. The decree will waive import duty for parts needed in car assembling that Vietnam can't make yet. Meanwhile, various discount and promotional campaigns have been launched to attract customers. VinFast announced that they will pay all registration fees for customers who buy Lux A2.0 and Lux SA2.0 this year. Cars dated back do 2019 and 2018 have even higher discounts. Many firms have worked with banks to provide preferential loans for customers. For some small cars, customers don't have to pay interest for the first two years. It is predicted that the industry will pick up in the last two quarters despite modest growth. If Covid-19 pandemic continues to develop complicatedly, the industry will be affected until 2021. Discount programmes will be rolled out constantly until Tet Holiday to help sell cars. Finding customers and balancing monthly basic expenses are still the most difficult tasks. Many firms have to cut staff and operations in order to maintain businesses. Distributors and retail agents are also affected. The automobile industry contributes 3% of the GDP each year with over USD7bn in 2019. Cambodia passes draft bills to curb money laundering, weapon financing The National Assembly of Cambodia on June 4 adopted two draft laws on anti-money laundering (AML) and counter-terrorist financing (CFT) and on combating the financing of weapons of mass destruction (WMD) proliferation. Speaking at the assembly's session, Cambodian Interior Minister Sar Kheng said the country became a member of the Asia Pacific Group (APG) on Money Laundering in 2004 and as its member, the kingdom is required to follow international standards on combating money laundering, terrorist financing and WMD proliferation financing. According to the official, the draft law on AML and CFT is designed to combat money laundering and terrorist financing by identifying measures to control, prevent, crack down on and eliminate them. It also stipulates measures to freeze, restrain and seize assets in criminal proceedings, and to punish perpetrators. Meanwhile, the draft bill on combating the financing of WMD proliferation was aimed at controlling on providing funds and services, such as financing, related to the export and trans-shipment of items that would contribute to the proliferation of WMD, he added. The two draft laws will need to be finally reviewed by the Senate before being submitted to Cambodian King Norodom Sihamoni for promulgation./. Agriculture aims to be among most developed countries worldwide by 2030 Vietnam is currently striving to have its agriculture rank among the 15 most developed nations globally by 2030, with hopes that the farm product processing industry can be among the top 10 countries in the world and a centre for deep processing and logistics of global agricultural trade. This goal comes after Prime Minister Nguyen Xuan Phuc recently issued Government Directive No. 25 relating to a number of tasks and solutions aimed at developing the domestic agro-forestry-fishery product processing industry and mechanising agricultural production. Many agricultural production models apply high technology, helping earn higher profits The directive states that, despite the mechanisation of agriculture and the agro-processing industry achieving remarkable achievements in recent times, the development has still fallen below the inherent potential that exists for the agricultural sector along with the strengths of many localities. PM Phuc therefore requests that ministers, heads of ministerial-level agencies, heads of government agencies, and chairs of People's Committees of centrally-run provinces and cities perform well when following their assigned functions and tasks by directing and implementing orientations to boost the development of the local agro-processing industry and agricultural mechanisation. The PM has also asked the Ministry of Agriculture and Rural Development to review previously promulgated plans relating to agricultural mechanisation and the agro-processing industry in an effort to integrate them into national planning. The ministry will therefore co-ordinate efforts with ministries, sectors, and localities in an effort to formulate and submit plans for approval to various national planning schemes ahead in the 2021 to 2030 period according to the Planning Law. The ministry has been requested to build a project that can develop three agricultural processing industries towards being ranked among the leading five countries worldwide in terms of fruit and vegetables, sea food, timber, and wood products, all of which must be submitted to the Prime Minister for consideration during the final quarter of 2020. The Ministry of Industry and Trade will also co-ordinate efforts alongside the Ministry of Agriculture and Rural Development to implement synchronous solutions aimed at taking full advantage of the opportunities that exists through impending free trade agreements. This includes the European Union-Vietnam Free Trade Agreement and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership with regard to processed agricultural products. The Ministry of Science and Technology will be concentrating and prioritising investment in the application of science and technology in terms of production, processing, and preservation of agricultural products. This will effectively implement national science and technology schemes to support businesses, farmers, and co-operatives to upgrade agricultural product processing and preservation technology with a priority being given to key national agricultural products. Elsewhere, the Ministry of Planning and Investment is set to balance and allocate investment capital for the implementation of the project aimed at developing three agricultural processing industries in the near future. Cassava exports skyrocket during five-month period Vietnam exported 1.27 million tonnes of cassava and cassava-based products during the opening five months of the year, raking in US$436 million, according to figures released by the Ministry of Agriculture and Rural Development. The figure represented a year-on-year increase of 20% in terms of volume and 7% in value. Indeed, the export price of cassava starch is expected to remain low as a result of a drop in demand from the Chinese market, while the export price of cassava chips is likely to increase over the short term due to increasing demand from the northern neighbour whilst domestic inventories gradually become low. The average export price of cassava and cassava-based products throughout the reviewed period stood at an estimated US$342 per tonne, a decrease of 11% on-year. Most notably, exports of cassava starch were estimated to be at 900,000 tonnes with a value of US$352 million, representing an increase of 6.6% in volume and a decline of 3.2% in value in comparison with the same period from last year. The average export price of cassava starch fell by 9.2% to US$391.3 per tonne during May and June due to China’s consumption demand for the product decreasing slightly. The Chinese market was able to successfully keep its place as the country’s main export destination during the first months of the year. The figures show that the total export volume of cassava and cassava-based products to this market during the first four months of the year reached 959,200 tonnes, with a total value of US$324.7 million, representing an annual rise of 15% in volume and 1.4% in terms of value. Despite this, the country’s cassava chip exports to China during April suffered a sharp decrease by 22% to 54,300 tonnes compared to March as a result of the price of alcohol experiencing a downward trend caused by the weakening of global oil and alcohol prices. Elsewhere, both Malaysia and Taiwan (China) have also increased imports of Vietnamese cassava and cassava-based products over the course of the four-month period. With the novel coronavirus being largely brought under control, the country’s agricultural exports, especially cassava exports, are predicted to recover with Vietnam-China border gates reopening in June. Mekong Delta pushes boat out to attract more visitors The Mekong Delta Tourism Association has launched a tourism promotion plan aimed at increasing traveler numbers by December, especially those from Southeast Asia. The plan is being initiated through the participation of 57 serviced accommodation businesses, 36 food and beverage service firms, 25 tourism areas, and 22 tourism agencies that are based within the region. At present, all of them have pledged to offer discounts of between 10% and 50% on service prices. Trinh Cong Vinh, chairman of the Bac Lieu Tourism Association, said the province would also be reducing the entrance fees on 12 tourism areas by 10% to 20%. Moreover, the province is also working on the development of agricultural tourism in the districts of Phuoc Long and Hong Dan. Simultaneously, An Giang province has finalised its upgrade of both the landscape and facilities at the Tra Su cajuput forest, a move that is anticipated to serve to attract additional numbers of cranes and other birds, whilst increasing the interest of visitors in the site. This comes after Tra Su had been recognised as the nation’s most beautiful forest earlier in the year by the Vietnam Records Organisation, with the site also featuring the longest bamboo bridge in the country. Vietravel, one of the nation’s leading tourism agencies, is currently outlining a new tour to link provinces and cities in the region, including Can Tho, Soc Trang, Bac Lieu, and Ca Mau. Le Dinh Minh Thy, director of Vietravel's Can Tho and Southwest region, stated that the new tour has been widely welcomed by consumers, who love participating in day-long tours as a way of discovering the Mekong region. Hiep, chairman of the Mekong Tourism Association, has moved to incentivise tourism businesses and organisations throughout the region in an effort to step up co-operation with Ho Chi Minh City to develop a fully developed tourism plan. According to provinces and cities located in the Mekong Delta, the number of arrivals in the region during the first four months of the year endured a drop of 41.6% from last year, whilst revenue plummeted by 42%. Billion-Vietnamese-dong meat processing factory abandoned The cattle and poultry slaughtering and processing factory in Ky Trinh Ward in Ky Anh Town in Ha Tinh Province was invested more than VND100 billion. This factory that belongs to Mitraco Processed Food Limited Company, a member of the State-owned Ha Tinh Minerals and Trading Joint Stock Corporation, was planned to cover an area of 12.5 hectares. The factory was equipped with an advanced production line under European standards on food safety. The factory planned to slaughter 500 pigs per day and process 2 tons of meat per day in the first stage, and slaughter 1,000 pigs, 100 cows, and 3,000 chickens per day and process 5 tons of meat per day in the second stage; treat 400 cubic meters of wastewater per day and night. The factory was started construction at the end of 2012 and handed over in June 2014. It came into operations with an initial scale of 100 pigs per day, accounting for 20 percent of its capacity. Processed products in the early stage included lean pork paste, sausages, ham, and some other high-class products. These products were consumed in supermarkets, stores, and markets in Ha Tinh Province, as well as for the domestic market and export. However, after operating for some time, it did not achieve efficiency as expected but operated perfunctorily and suffered losses. By 2018, the factory faced stagnancy then came to a stop and has been abandoned until now. Explaining the reason that caused the factory to stall, on June 4, Ms. Nguyen Thi Ha, Deputy CEO of Ha Tinh Minerals and Trading Joint Stock Corporation, said that the consumption was too low while consumers have not habituated with industrial processing and manufacturing process and they rarely use frozen products. According to Ms. Ha, the company has just signed a cooperation agreement with a company in Hanoi to continue to invest in production but this company has not done anything yet. 1,920 startup companies established in Ho Chi Minh City At a meeting between the Ho Chi Minh City People’s Council's Economics and Budget Committee and HCMC Enterprise Association on startup ecosystem development yesterday, a representative from the Department of Science and Technology, announced 1,920 startup companies have been established in the city so far. Of 1,920 startup companies, more than 70 percent are in IT field and the remaining in high-tech agriculture and other fields. The Department of Science and Technology has launched four startup support packages. One is for consultation and training with maximum expenditure of VND200 million (US$8,590 ) per project. The second is for connection and the third one is for startup project incubation not exceeding VND500 million per project. The fourth package is for startup project acceleration. So far, the city has given VND23 billion to support 40 startup companies. Additionally, a private investment fund has poured money into 21 startup projects. Most of startup companies decided to invest in niche market to avoid competition. Presently, startup companies have been attractive for investors and private investment funds which agreed to pour money into startup companies. However, on the other hand, General Secretary of the HCMC Enterprise Association Nguyen Ho Thien Nhan said many startup projects are copied from their foreign peers; therefore, there has been no breakthrough in the startup projects. Sponsors for startup companies complained of complex administrative procedures. To make startup ecosystem more effective, the city needs to have financial mechanisms to attract capital in a bid to help startup companies grow more. Moreover, legal environment must be less complicated for establishment of investment fund. The most important factor is launching venture capital funds simultaneously with private venture capital funds. Regarding tariff policies, startup companies are exempt from paying tax within 3 to 5 years. Last but not least, activities such as commercial promotion, market connection, investment in new technologies must be organized to facilitate enterprise operation. Furthermore, the city should re-orientate startup field which must link with IT, high valued industries and cultural and creative industries because these are potential with fast growth. An effective startup project can satisfy three criteria including offering employment, creating value for society and sustainable development. A representative from the People’s Council's Economics and Budget Committee emphasized that there are a lot of startup support package. The Committee listened to opinions about difficulties and then make petition to city authorities to have assistance. Besides, the HCMC Enterprise Association should have detailed assessment of support policies and propose support solutions for each difficulty they are facing so that city government can adopt more effective support policies to push up growth of enterprises generally and startup companies particularly. Vietnam tax revenue down 2.4% in Jan-May Tax revenue in May suffered a sharp plunge of 36.9% year-on-year to VND58 trillion (US$2.52 billion). The impacts of the Covid-19 pandemic led to a decline of 2.4% year-on-year in Vietnam’s tax revenue collection in the first five months of this year to VND499.83 trillion (US$21.73 billion), according to the General Department of Taxation. The department attributed the 15-day nationwide social distancing campaign from April 1 to 15, in which non-essential services and businesses were forced to close or scale down operation, to the fall in tax revenue. Meanwhile, government’s supporting programs, including the extension of payment deadline for land rental fees and taxes for enterprises, organizations and individuals affected by the pandemic, also contributed to the decline. Notably, tax revenue in May suffered a sharp plunge of 36.9% year-on-year to VND58 trillion (US$2.52 billion), of which, revenue from crude oil fell by 74.9% and that of domestic sources dropped 34.2%. Among measures to mitigate negative impacts on the state budget, the taxman aims to tighten the value-added tax refund process and recover at least 80% of tax arrears incurred before December 31, 2019, along with the reduction of tax debts in 2020 to below 5% of the total. In the five-month period, tax authorities recovered VND12.37 trillion (US$538 million) in tax arrears, equivalent to 29.5% of the total recoverable amount at the end of 2019, and up 5.8% year-on-year. Tax authorities are expected to closely monitor operations and tax payment process of enterprises. In the first five months of 2020, Vietnam had 48,341 newly established enterprises, down nearly 5,500 enterprises compared to the same period last year. According to the General Department of Taxation, as of June 1, the agency has received 128,684 claims to defer taxes and land rental fees payment with an amount of VND36.96 trillion (US$1.6 billion). The process of applying for extension of tax payment has now been integrated into the national portal of public online services, aiming to create convenience for the business community and individuals. At a government meeting in early April, Minister of Finance Dinh Tien Dung said in case the pandemic ends within this quarter, the country's GDP growth would come in at 5.3% and if oil prices average at US$35 per barrel, the state budget may lose VND140 – 150 trillion (US$6 – 6.43 billion). The losses would be bigger if GDP grows by less than 5%. The Ministry of Finance estimated fiscal deficit could increase to 5 – 5.1% of GDP, significantly higher than the target of 3.4% (excluding debt principal repayments) set in December 2019. Hanoi’s tourism gradually recovers from Covid-19 impacts The city’s tourism industry saw a slight increase in number of tourists in May compared to April. With a total of 258,000 arrivals, the tourist influx to Hanoi increased by 6.1% in May compared to April, according to the Hanoi Department of Tourism. The arrivals in May dropped by 87.7% inter-annually due to impacts from the Covid-19 pandemic. Of the total 258,000 tourists in May, international arrivals to Hanoi increased 41.2% compared to April to 12,000, while domestic tourists jumped 811% against April to reach 246,000. Foreign visitors are mainly expats, diplomats as Vietnam still bans foreign entry. There were about 400 foreign tourists making overnight stay in Hanoi last month, according to the city’s Immigration Department. In the first five months of 2020, Hanoi welcomed 4.13 million tourists, a decrease of 64.5% compared to the same period last year. Revenue from tourists to the city was VND16.6 trillion (US$713.2 million), representing an inter-annual fall of 59.3%. The occupancy rate of hotels in the city reached 19.26% in May, up 6.46 percentage points from April, but still down 51.74 percentage points from a year earlier. In the five-month period, hotels in the city had 32.25% of their rooms filled up, down 38.37% percentage points from the same period of 2019. From May 14, many relic sites and tourist destinations in Hanoi, such as Temple of Literature, Hoa Lo Prison, Thu Le Park, Ngoc Son Temple, and museums, reopened to visitors after a period of the closure to prevent the Covid-19 pandemic. To revive the tourism industry, Hanoi plans to focus on building typical tourist packages, the highlights are among which are the “Thang Long Tu Tran” (Hanoi’s four sacred temples) tour in the inner city and visits to craft villages and eco-tourism in suburban areas. Singapore’s April retail sales see biggest drop in 35 years Singapore's retail sales in April plummeted 40.5 percent compared to the same period last year – the biggest drop since 1985. According to data released by the Department of Statistics on June 5, this was a much steeper fall than the 13.3 percent decline in March and marks 15 straight months that retail sales have decreased. Sellers of discretionary items were hit the hardest by these moves, with the sales of watches and jewellery dropping 87.8 percent. Retailers of wearing apparel and footwear also saw takings drop 85.3 percent. Sales at department stores and motor vehicle sales plunged 84.6 percent and 77 percent, respectively. However, sales at supermarkets and hypermarkets rose 74.6 percent, while minimarts and convenience stores also saw an increase in takings of 10.7 percent. Estimated total retail revenue of the country in April was about 2.1 billion SGD (1.5 billion USD), with online sales making up around 17.8 percent, more than double the share in March./. Entrepreneurs hail ratification of EVFTA, EVIPA Many business owners in the southern province of Dong Nai, a major industrial hub in Vietnam, have expressed delight at the National Assembly (NA) ratifying the EU-Vietnam Free Trade Agreement (EVFTA) and the Investment Protection Agreement (EVIPA) on June 8. Nguyen Ngoc Tuan, Director of the Viet A Tax-Accounting-Law Co. Ltd in Bien Hoa city, said the two deals are of critical importance as they reflect Vietnam’s increasing integration into the global economy. They also show that the EU and its members attach importance to and highly value the country’s economic development potential. Vietnam is one of ASEAN’s two largest exporters to the EU, he went on, noting that the ratification of the agreements will help reduce its export dependence on certain markets and bolster shipments to the EU, especially leather footwear, garments, and agricultural products. The EVFTA and EVIPA will also help the country press on with improving its business climate to match international practice, he said. To capitalise on the advantages generated by the two deals, he believed domestic firms should comprehensively study their regulations and commitments while enhancing their own governance to boost competitiveness. Ministries and other central agencies also need to publicise the EVFTA and EVIPA to help businesses make use of the opportunities and must also amend the legal framework where necessary to ensure the interests of all enterprises, he suggested. Echoing that view, Dang Tuong Khanh, Director of the Trong Duc Cocoa Company in Dong Nai’s Dinh Quan district, said the agreements will bring about considerable opportunities for Vietnam’s agriculture sector. He took cocoa as an example, explaining that most of the major processing facilities around the world are currently located in Europe and primarily use materials imported from Africa. The majority of cocoa trees on the continent, however, are quite old and output and quality are on the decline. Given this, European processors are seeking new material suppliers. Vietnamese cocoa, meanwhile, has been highly valued around the world and he proposed that authorities prepare detailed development strategies to help it enter the European market. The State needs to pay greater attention to agricultural processing, Khanh added, as Vietnam is home to a number of quality farm products but processing remains weak, which has hampered product competitiveness./. |
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Time for Vietnamese smartphone brands to conquer home market 01:55 After a lot of failed efforts, Vietnam’s smartphone products now have a great opportunity to return to the market. When Vietnamese smartphone brands in the pasthad to leave the market, analysts said the deaths of the brands had been anticipated.  The smartphone market had entered the saturation period and sales were growing very slowly. Meanwhile, they had to compete with a lot of giants, from Samsung, Apple and Nokia to Chinese manufacturers whose products are surprisingly cheap. In such conditions, the existence of Vsmart and BKAV are believed to be ‘a miracle’. Vsmart unexpectedly added its name to the top 3 brands with 16.7 percent of market share after 15 months of debut. “The smartphone market had entered the saturation period and sales were growing very slowly. Meanwhile, they had to compete with a lot of giants, from Samsung, Apple and Nokia to Chinese manufacturers whose products are surprisingly cheap”. It is the success of Vsmart which has madr people change their view about the abilities of Vietnamese brands. Vsmart smartphones have very strong configuration. With just VND3 million, people can own a smartphone with fashionable design, Snapdragon 675, AMOLED screen with high resolution level Full HD+, and integrated fingerprint security – the features that are equipped for high-end models priced at tens of millions of dong. Analysts commented that what makes the success for Vsmart is its business strategy which focuses on the mass market segment with the products priced at VND1-3 million. As for BPhone, Nguyen Tu Quang, CEO of BKAV Corporation, admitted that the company is taking loss with BPhone, but stated that BKAV will still be persistent with the strategy on developing the company into ‘Apple or Samsung of Vietnam’. BKAV, which is preparing for the launch of the fourth generation of BPhone, seems to target the mid-end market segment, rather than the high-end segment as it initially did. The segment, accounting for 20 percent of the total mobile phone market, has been controlled by Samsung, Oppo and Apple. According to GfK, in the first seven months of 2019, 99 percent of consumers who bought smartphones priced at over VND15 million chose products of Samsung or Apple. In 2019, Vietnamese bought 15 million smartphone products, of which high-end products priced at over VND10 million accounted for less than 10 percent. Analysts believe that mid-end and low-end segments are fertile land for Vietnamese smartphone brands. They have every reason to focus on low-cost smartphone products as the government has announced the program on popularizing smartphones to 100 percent of the population. Under the program, mobile network operators, app developers and phone manufacturers will join forces to lower some smartphone prices to $20, or VND500,000. |
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Masan Resources completes acquisition of German firm’s tungsten business02:21The Masan Tungsten Company Ltd., a wholly-owned subsidiary of the Masan Resources Corporation (MSR), has completed the legal steps to acquire the tungsten business of Germany’s H.C. Starck Group GmbH, according to the corporation.
The transaction is a strategic step in executing MSR’s vision of becoming a leading global vertically-integrated high-tech industrial materials platform. This will enable the company to generate strong and consistent cash flows across price cycles and expand its addressable market by 3.5 times, from 1.3 billion USD to 4.6 billion USD. MSR expects to become a leading midstream tungsten products supplier across critical industries such as mechanical engineering and tool making, mining, automotive, energy, aviation, and chemicals. The transaction aims to create a global high-tech industrial company of scale in Vietnam and, more importantly, enhance the country’s competitive edge in the global tungsten market by owning a cutting-edge R&D and technology platform. It will also offer the local workforce an opportunity to develop engineering skills in the high-tech manufacturing space as part of the globalisation of MSR’s business. Starck is a leading manufacturer of high-tech tungsten metal powders and carbides, with production facilities in Europe, North America, and China, and customers across the globe. It owns 105 patents and patent applications and other intellectual property to manufacture innovative products such as ultrafine-sized tungsten compounds. In addition, it is one of only a handful of companies in the world with a comprehensive, environmentally-sound tungsten scrap recycling platform backed by proprietary intellectual property./. |
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HCM City’s transport infrastructure lags behind demand despite huge investment02:45 HCM City allocates about US$431.9 million a year for the transport sector but the funding does not seem to be enough for narrowing the gap between the local infrastructure system and travel demand, heard at a meeting on June 10.
The event was held between a delegation of supervisors from the municipal People’s Council and relevant departments and agencies on the progress and efficiency of key transport projects in the city. Work has completed on 39 out of the 172 projects under the programme on reducing traffic congestions and accidents while 78 others are still in progress, said Director of the municipal Department of Transport Tran Quang Lam. Most of the transport projects in the city are far lagging behind schedule, for example the 64-km belt road No.2 crossing eight districts. Though the project is slated to complete this year but to date, construction has done on about 50km of the road while the remaining sections are in progress. Lam said from 2016 – 2020, the traffic congestion and traffic reduction programme has received more than 12.62 trillion VND from the State budget, only equal to around 27 percent of the target. The city hopes to get the remaining funding from the private sector through the Public-Private Partnership scheme but only 13 percent of the financial needs have been met, or close to 16.97 trillion VND, over the last five years. The Department of Transport has proposed the municipal People’s Council to prioritise capital from the medium-term public investment plan for the 2021 – 2025 period for projects under the city’s transport infrastructure development plan by 2030. At the same time, the HCM City People’s Committee has asked relevant departments and agencies to revise and issue special mechanisms and policies for luring investment into the city’s transport infrastructure projects in line with the National Assembly’s Resolution No.54 on related matters. In her remarks at the meeting, Chairwoman of the municipal People’s Council Nguyen Thi Le said the large number of long-delayed projects has severely affected daily lives of local residents, adding the projects have failed to reach expectation when it comes to efficiency. One of the reasons behind this is the lack of an effective cooperation between relevant departments, agencies and districts in various stages of the projects, particularly site clearance, she noted. The city leader requested the Department of Transport to come up with effective solutions to accelerate the disbursement and the progress of key projects. It was also asked to not stretch investment across too many projects but focus on important ones to soon put them into use. Le ordered the Department of Environment and Natural Resources to adopt new policies on compensate rates and residential relocation supports, suitable to the city’s current socio-economic situation. The Department of Investment and Planning was tasked to earmark sufficient funding for the projects under the traffic congestion and accident reduction programme to prevent them from being further delayed./. |
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BUSINESS NEWS HEADLINES JUNE 12 01:33 Pathway to revamp legal corridor to promote digital banking  With Vietnam currently being home to 70 credit institutions along with payment intermediaries such as e-wallets which provide financial services through the Internet and mobile phones, experts in the field have underlined the need to complete the legal corridor to promote the development of digital banking in the future. Statistics indicate that the value of financial transactions has reached over VND7 million billion via the Internet and approximately VND300,000 billion through mobile phones. These figures show that the transaction volume remains small in comparison to the overall size of the economy. Among economies throughout Southeast Asia, Vietnam enjoys advantages in terms of developing a digital economy due to a relatively strong digital infrastructure when compared to other economies regionally. There also exists plenty of advantages in order to transform the digital economy into a digital space, therefore promoting digitalisation among businesses. Within the banking sector, in contrast to the traditional banking model, digital banks and e-wallets have several differences and competitive advantages due to all communication channels with customers being conducted online through mobile platforms with a rich, intuitive, and cohesive interface, serving to create greater customer engagement. Despite the nation making progress to build a legal corridor for digital payment services, there remains paperwork obstacles amid the current system of documents which has ultimately served to impede digital payments from expanding in a rapid manner. Nguyen Tri Hieu, a financial expert, emphasized that it is essential to first develop a standard legal framework without moving into areas that are not fully controlled. According to Pham Tien Dung, head of the Payment Department of the State Bank, the country has a form of legal framework suitable for digital payments but the question remains on how to develop new models. Moreover, it is considered necessary to complete the digital technology infrastructure system with a focus being placed on building and refining the technology infrastructure within the banking industry, whilst also strengthening applications used by the banking industry with other service sectors as a means of expanding the digital ecosystem. Dung also stressed the necessity of building a national database for the population that protects user data and transactional security, a factor that is critically important for digital banking development. Mytel has 10 million subscribers in two years Mytel – a telecom brand of Viettel Group in Myanmar on Thursday announced it would have 10 million subscribers after only two years of operation. The result has made Mytel the second largest telecom provider in Myanmar and is 2.5 times higher than that of the fourth position. Mytel also completed its set targets six months before schedule. Myanmar is also Viettel’s international market with the highest number of customers. Earlier, Mytel also reached two million subscribers in a record time of just a month. Myanmar is the 10th international market of Viettel with the largest population and investment. At the time of launching, Mytel has a fibre optic cable infrastructure of 36,000 kilometres, accounting for 50 per cent in Myanmar. This was also the first telecom provider covering 4G across Myanmar. Mytel is the first telecom firm in the country providing Voice over Long-Term Evolution (VoLTE) – a standard high-speed wireless communication for mobile phones and data terminals, eSIM and 5G network. Currently, 75 per cent of Mytel’s customers are using 4G services. This is the highest rate among international markets of Viettel Group. In the first quarter of 2020, Mytel posted profit of US$25 million thanks to strong growth in terms of subscribers and new services under its digital transformation strategy. The telecom has achieved profit two years sooner than expectation. Since its participation in the telecom market, Mytel has helped promote internet services in Myanmar with coverage rising from 31 per cent in June 2018 to 55 per cent in September 2019. Mytel is also the most popular operator in Myanmar with a Net Promoter Score (NPS) of positive 11. TMV opens new dealership in Da Nang Toyota Vietnam Motor (TMV) on Friday officially opened Toyota Okayama Danang in the central city of Da Nang, bringing the total number of Toyota authorised dealers and branches to 65. This is part of TMV’s expansion plan of its dealer network and authorised service stations in the central region to meet the growing demand of the market and bring quality products and services to customers nationwide. The dealership was constructed on an area of more than 12,000sq.m, covering a showroom, customer lounge and service area. The service area is designed with 59 compartments for repairs, including 19 compartments for express and general repairing and 40 modern compartments for painting including paint mixing and colour mixing systems in closed areas, which ensures environmental safety. Toyota Okayama Danang possesses modern equipment and environmentally-friendly technology such as automatic washing machines using Japanese Banzai technology and environmentally friendly water-borne paint technology. Up to now, TMV's network has reached 65 dealers/branches and authorised service stations, located in 31 provinces and cities nationwide. Origin of goods- important requirement to enjoy EVFTA tariff preferences In order for Vietnamese goods that are exported to the EU to enjoy preferential tariffs in the European Union-Vietnam Free Trade Agreement (EVFTA), businesses must obtain a thorough grasp of the provisions set out in the trade deal which stipulate very strict requirements regarding the origin of products, according to insiders. Phan Van Chinh, director of Import and Export Department under the Ministry of Industry and Trade, said that methods to ensure that the rules on the origin of goods are followed is viewed as a primary task when it comes to importing and exporting activities with the EU once the EVFTA is implemented. There exists some advantages of the "cumulative" provision set out in the EVFTA, with enterprises needing to know them in order to be able to take full advantage of Vietnamese goods and products when exporting items to the EU, he noted. According to experts, local exporters to the EU market must update new content such as the mechanism of self-certification of origin, a process which sees exporters declare the origin of their products as stipulated within documents submitted to the customs office of the importing country, as opposed to having to apply for a traditional certificate of origin from relevant agencies. Nguyen Thu Trang, director of the Center for WTO and Integration of the Vietnam Chamber of Commerce and Industry (VCCI), said along with the timely promulgation of a Circular on the origin of domestic exports to the EU once the EVFTA takes effect, it is also necessary to issue a Circular to regulate rules and origin of goods from the EU to Vietnam. The agricultural sector is viewed as one of the biggest beneficiaries of the EVFTA, largely due to rice, one of the country’s key export products, being forecast to increase by 65% to the EU by 2025, with the EU set to impose a tax rate of 0% on rice products in line with the roadmap set out in the trade agreement. Consequently, the EVFTA will present a wave of fresh opportunities for Vietnamese businesses if they are suitably prepared and ready to capitalise on the benefits brought about by the trade pact. The Import and Export Department is set to strengthen the State management over the granting of certificates of origin whilst simultaneously combatting fraud relating to goods. As a result, local firms will be supported when dealing with issues regarding verification of origin of goods as required by the EU as part of protecting the legitimate interests of Vietnamese businesses. E-commerce promoted to boost Vietnam's digital economy Last month, the Vietnamese government approved a master plan on national e-commerce development through 2025. The plan is part of efforts to promote the digital economy whose advantages are tapped to boost competitiveness and productivity, and expand the market and exports. The national plan on e-commerce development in the 2021-2025 period is integrated with current Vietnamese strategies and policies on participating in the Fourth Industrial Revolution toward developing a digital economy and promoting national digital transformation. Its overall goals include promoting the application of e-commerce in businesses and the community, narrowing the gap between major cities and localities to promote online trading, building a sustainable virtual market, boosting production and consumption of Vietnamese goods, and increasing cross-border online trade. Vietnam expects online shoppers to account for 55% of the population by 2025, with average spending projected to hit US$600 million a year. It forecasts revenue from e-commerce in the buyer-to-customer (B2C) model to surmount US$35 billion, or 10% of retail sales and services nationwide, thus raising the use of cashless payment 50%. Nguyen Binh Minh of the Executive Committee of Vietnam E-Commerce Association said, “COVID-19 is a test for the entire world to restructure its economy. In the pandemic, e-commerce has proved its high stability in a crisis. Nobody can say exactly when COVID-19 will end. For the time being, e-commerce is a good solution and will continue to be in the future. Promoting e-commerce as the core in the national economic development will no longer be a direction, but a right solution.” Under the plan, the Ministry of Industry and Trade proposed six ways to develop e-commerce in Vietnam including fine-tuning policies and mechanisms; improving management capacity; fighting trade frauds, infringement of intellectual property rights and unfair competition in online environment; strengthening domestic consumer confidence; and promoting cross-border online trade. Dang Hoang Hai, Director General of the Ministry of Industry and Trade’s Department of E-commerce and Digital Economy, said: “We have to develop e-commerce nationwide instead of only in big cities. Second, it’s necessary to apply new technologies to better manage product quality and reduce costs for e-commerce. Third is to develop Vietnamese goods.” “These will be the foundation for making full use of e-commerce to bring benefits to people in remote areas, create healthy competition among Vietnamese manufacturers, and drive the national economic development. To help e-commerce develop more comprehensively, we will revise the decree on e-commerce and work with other ministries and sector to promulgate strict punishments to prevent violations of goods quality,” Hai added. Once the master plan is put into practice, Vietnam’s e-commerce will likely move up to second place in Southeast Asia and become the most potential market in the region by 2025. Economist Nguyen Tri Hieu said, “I totally agree with the master plan because, in fact, e-commerce is an inevitable trend. It has been widespread in developed countries. To achieve this goal, the government and functional agencies need to speed up the cashless payment system. We also need to change consumers’ shopping habit by enhancing trust-building activities for customers.” Consumption habits have changed significantly due to the COVID-19 epidemic. Consumers now prefer online shopping to traditional shopping methods. Many individuals and businesses are turning to online channels to promote their products and trade. COVID-19 impact puts businesses in fight for survival Plenty of local enterprises have made great strides to adapt to the new situation whilst struggling to maintain production and their business activities despite numerous difficulties as a result of the impact of the novel coronavirus (COVID-19). Indeed, many industries have been strongly affected over the past few months due to the effects of the COVID-19. Despite this tough economic picture, the country’s seafood exports have successfully enjoyed a rapid recovery due to the confidence of investors, importers, and retailers for Vietnamese seafood to grow significantly over time, according to Truong Dinh Hoe, General Secretary of Vietnam Association of Seafood Exporters and Producers (VASEP). Hoe went on to express that while other seafood exporters have encountered numerous challenges as a result of the pandemic, the country has begun to recover production moving into the post-pandemic period as a means of maintaining seafood supply sources for the world, noting that this has also created a range of opportunities for Vietnamese seafood in the near future. In addition, the nation’s supply chain of essential materials for aquaculture and processing have not been dependent on the Chinese market. According to Hoe, a shift in production from China to Vietnam will begin to emerge, especially due to the lasting effects of the ongoing trade war between the United States and China trade war, along with the COVID-19 pandemic, with demand for aquatic products expected to increase sharply ahead in the post-pandemic period. Recent times have seen the apparel and garment industry overcome plenty of challenges caused by the COVID-19 by shifting production to medical equipment such as protection gear and face masks, therefore helping to generate jobs for local workers. Nguyen Triet, a representative of a local textile firm based in Hai Duong province that exports products to the US market, said that the company has been able to maintain signed orders and has created stable jobs for 300 employees, whilst trying to negotiate with partners not to cancel contracts for new orders. Amid numerous difficulties, firms have been striving to seek new markets and secure orders while pining their hopes that consumption demand will pick up with more export orders in the post-pandemic period, Triet added. With a market of nearly 100 million people, there remains plenty of room ahead for the consumption of local products amid the complicated nature of the COVID-19 pandemic globally. Vu Quoc Vuong, director of Dong Ky Wood Investment and Development Joint Stock Company cum Chairman of Dong Ky Fine Arts Wood Association, said several countries have moved to impose lockdowns and have sealed their borders due to the pandemic, causing great difficulties for import and export activities. Vuong elaborated that the company and its members have been active within the domestic market, making improvements in terms of design, approaching customers, diversifying products to maintain production, and creating jobs for workers in order to overcome the challenging time. Hoang Duc Vuong, General Director of Vinh Thanh Joint Stock Company, said that numerous manufacturing and export firms are facing difficulties, especially with regard to the plastic industry. He noted that plastic exports now account for between 60% and 70% of business, with the domestic market becoming an alternative option for local businesses in which to overcome disruption in the global production chain as a result of the COVID-19. Most notably, when the Government's economic support packages are deployed and public investment disbursement is strengthened, these moves ultimately create fresh impetus for the gradual recovery of enterprises, Vuong emphasised. Dr. Nguyen Minh Phong, an economic expert, pointed that the domestic market of nearly 100 million people can act as a magnet for local firms in the near future, noting that businesses must ensure the quality of goods, enhance their processing stages, improve their designs, reduce prices, and increase incentives for customers. ManpowerGroup and MoLISA seek sustainable employment and business model in new normal ManpowerGroup Vietnam in collaboration with the Ministry of Labour, Invalids and Social Affairs (MoLISA) on June 3 organised a webinar titled “Solutions to Sustainable Employment & Business – Sharing from International Experiences” to explore solutions to a sustainable employment and business model to fit the new normal. The webinar “Solutions to Sustainable Employment & Business – Sharing from International Experiences” The forum welcomed executives from the MoLISA, the Vietnam Chamber of Commerce and Industry (VCCI), and the International Labour Organisation (ILO), along with two ManpowerGroup country managers in the Asia-Pacific and Middle East, to share international experiences with the Vietnamese business community. With the current unprecedented challenges on people and economies around the world due to COVID-19, the global workforce ecosystem has been heavily affected. Vietnam is no different. According to the MoLISA, over 47,000 people have applied for unemployment insurance in February 2020, an increase of 59.2 per cent compared to January 2020 and over 70 per cent from the same timeframe last year. Le Van Thanh, Deputy Minister of Labour, Invalids and Social Affairs said, “In Vietnam, COVID-19 has impacted the bottom lines of almost all organisations and workers in various sectors, from hospitality, manufacturing to agriculture, travel, and export-import. When the economy is reopened in what will be the new normal state, one of the top priorities of the Vietnamese government is to create employment for people who have lost their jobs, ensuring that the local workforce can re-join the labour market; promoting the role of enterprises from all economic sectors and actively participating in economic development, production, and value chains brought by the newly-signed free trade agreements.” “We welcome international partners to share best practices and lessons on measures to help impacted workers and employers in Vietnam improve their resilience,” he added. It was noted that unparalleled collaboration and co-ordination by diverse stakeholder groups, ranging from employers and governments to labour unions and institutes, is needed to prepare for the new normal in the workplace. “In this new reality, a disciplined return to work will be key to economic recovery. Great efforts have been made to re-deploy/reallocate labour across a range of industries such as aviation, ground services, and ride-hailing, among others in Singapore, Malaysia, Thailand ,and elsewhere,” said Sam Haggag, country manager of ManpowerGroup Malaysia, director and executive sponsor, TAPFIN – Asia Pacific & Middle East. An optimal talent strategy in the new normal is at the forefront of any organisations’ success. Simon Matthews, country manager of ManpowerGroup Vietnam, Thailand, and the Middle East highlighted that, “With 84 per cent of organisations to be upskilling their workforce by 2020, companies need a newer approach to accelerate upskilling and to develop the talent they need to remain competitive. Employers also need innovative engagement and hiring strategies to differentiate.” He also shared how the HR services industry with large global networks covering all relevant stakeholders have proven its agility to keep up with changing circumstances and in helping clients and talent to prepare for the future. In addition to the issue, the webinar also helped to reiterate the fact that to limit the economic downturn and its impact on people’s ability to earn a living, the labour market and all its stakeholders must quickly adjust to the new normal, where physical distancing and other strict measures will be integral to all workplace processes for a considerable time to come. Also at the event, representatives from Bosch Vietnam and IKEA Vietnam shared their solutions to ensure sustainable employment and business model in the new normal state. ManpowerGroup, the leading global workforce solutions company, helps organisations transform in a fast-changing world of work by sourcing, assessing, developing ,and managing the talent that enables them to win. ManpowerGroup develops innovative solutions for hundreds of thousands of organisations every year, providing them with skilled talent while finding meaningful, sustainable employment for millions of people across a wide range of industries and skills. Its expert family of brands – Manpower, Experis, and Talent Solutions – creates substantially more value for candidates and clients across 80 countries and territories and has done so for 70 years. In 2019, ManpowerGroup was named one of the World’s Most Ethical Companies for the 10th year and one of Fortune’s Most Admired Companies for the 17th year, confirming its position as the most trusted and admired brand in the industry. Vietnam’s rice export revenue up 18.9% in first five months Vietnam exported a total of 2.9 million tonnes of rice in the first five months of 2020, bringing in US$1.41 billion, an increase of 5.1% in volume and 18.9% in value. According to the Ministry of Industry and Trade (MOIT), Vietnam is seeing plenty of opportunities to outstrip Thailand in rice exports this year thanks to more competitive prices and a strong rally in shipment volume after the removal of the export quota. During the first four months of 2020, the Philippines was the largest buyer of Vietnamese rice, purchasing 902,100 tonnes for US$401.3 million, up 11.4% in volume and 26% in value. Vietnam also saw substantial increases in rice shipments to China, Indonesia, Taiwan (China) and Ghana, but exports to the Ivory Coast fell sharply by 44.5%. As Vietnam fully resumed rice exports from May 1, prices of the Vietnamese grain during the month rose to the highest level for years, reaching an average of US$527 per tonne, up 5.6% from the previous month and 21.4% compared to a year earlier. Vietnamese rice prices in the first five months of 2020 averaged at US$485 per tonne, up 13% compared with the same period of last year. Average cost per unit of North-South expressway at VND 115.8 bln one km The Ministry of Transportation on June 6 announced that the approved cost per unit for the North-South expressway is at VND115.8 billion per kilometer, much lower than that in the Decision No.44/2020 of the Ministry of Construction. According to the Ministry of Transportation, in the total preliminary investment of about VND118.72 trillion, the cost structure for the project included VND11.43 trillion for site clearance, VND67.92 trillion for construction and equipment cost, VND7.78 trillion for project management, consulting, and other costs, and VND12.35 trillion for provision. Based on cost calculation, the ministry decided to approve the average cost per unit of the North-South expressway at VND115.8 billion per kilometer. The cost per unit includes the costs for construction of bridges and tunnels, reinforcing soft ground, smart traffic system, non-stop electronic toll collection system, and frontage roads to serve people’s livelihood. In excluding the Cam Lo – La Son project with a scale of two lanes and a total length of 98.4 kilometers, and the My Thuan 2 Bridge project with a length of 6.6 kilometers, the average cost per unit of the North-South expressway will be around VND95.6 billion per kilometer. Earlier, at the Decision No.44/2020, the Ministry of Construction announced the cost per unit for four-lane roads for the region 1 in the North, region 2 in the Central, and the region 3 in the South. Of which, the cost per unit for the region 2 was VND 157.48 billion per kilometer. If excluding the construction costs for bridges and reinforcing soft ground, the cost per unit would be VND 124.98 billion per kilometer. Inflation control becomes top priority in second half of 2020 Inflation control target will be the top priority in monetary management policy from now until the end of 2020, announced Deputy Governor of the State Bank of Vietnam (SBV) Nguyen Thi Hong at a press conference in Hanoi yesterday. Of these, the focus will be on interest rate and exchange rate management, market movements, credit scale control for quality improvement and Covid-19 developments to meet the economy’s capital demand in a timely manner. In addition, SBV will continue asking credit institutions to implement solutions to solve difficulties for customers affected by Covid-19 such as debt restructuring and interest reduction or exemption. According to SBV, under impacts of the Covid-19 pandemic, credit demand posted low growth in the first six months of 2020. As of May 29, it reached only 1.96 percent compared to the end of 2019, much lower than 5.74 percent and 6.16 percent during the same period in 2019 and 2018 respectively. Currently, credit institutions are positively implementing programs to support residents and businesses under the impacts of the pandemic with interest rate as low as 3-4 percent a year. By May 25, the banking system had restructured debts for nearly 224,000 customers with the total outstanding loans of VND152 trillion (US$6.53 billion), applied interest exemption and reduction to over 326,000 customers. With the above results, SBV believed that the monetary management policy has positively worked to assist the economy’s recovery from Covid-19, contribute to macroeconomic stabilization and inflation control from now until the end of the year. HCMC prioritizes preventing businesses from going bankrupt HCMC is set to focus on preventing businesses from going bankrupt by putting in place specific measures from now until the end of this year, said the municipal government at a meeting on the city’s January-May socioeconomic situation held on June 4. Data of the HCMC Department of Planning and Investment revealed that between January and May, 2,015 businesses were shutting down and over 7,250 others were temporarily suspending operations in the city, up 16.4% and 29.9%, respectively, compared with the same period last year. At the same time, there were over 14,250 newly established enterprises with total registered capital of VND185 trillion, down 85.5% and 70.3%, respectively, compared with the same period last year. Addressing the meeting, HCMC chairman Nguyen Thanh Phong asked municipal departments and agencies to take specific measures to support businesses affected by the Covid-19 pandemic, especially those facing a high risk of bankruptcy. “Preventing bankruptcy means preventing unemployment. Most businesses in HCMC are micro and small, which are the most vulnerable to the Covid-19 pandemic,” he noted. Commercial banks have reduced interest rates for some 17,500 clients and restructured debts for many businesses. The city’s chairman noted that tourism was the hardest hit sector and had seen a steep decline in the number of tourists and revenues. To help the tourism market recover, the city’s government has tasked the Department of Tourism with launching new products and collaborating with other cities and provinces to boost the demand for local travel. Phong asked the pillars of the economy including banking, insurance, taxes and customs to put in place specific measures to help businesses recover. The city will also promote innovation, implement social security policies, reduce the unemployment rate and accelerate the disbursement of public investment. According to the World Bank, a 10% increase in public investment disbursement will lead to a 0.6% increase in gross domestic product. Ministry proposes picking Song Da Corporation as expressway’s contractor despite its VND11t debt The Ministry of Construction has proposed picking Song Da Corporation as the contractor for some sections of the North-South Expressway project despite the corporation being over VND11 trillion in debt. The ministry justified this, saying Song Da Corporation was chosen because of its human resources, available equipment and experience in constructing large projects. Meanwhile, the corporation has been struggling with financial difficulties in recent years. As of late 2019, it incurred a debt of VND11,135 billion including VND5,302 billion in financial lease debt, according to the Ministry of Finance. The corporation’s debt to equity ratio was 2.8, approximating the financial risk level. Song Da Corporation’s debt came from its subsidiaries and affiliates including Halong Cement Company (VND2.7 trillion), Viet Lao Power JSC (over VND800 billion), Nam Chien Hydropower Company (some VND700 billion), Xekaman 1 Power Company (some VND300 billion) and Xekaman 3 Power Company (VND560 billion). Quang Nam sets its sights on green tourism model While the Covid-19 pandemic has caused serious damage to the tourism industry, it is also an opportunity for many localities to look back on their tourism models and pave the way for a green and sustainable tourism industry. A seminar themed “Quang Nam Tourism Market Reconstruction” on June 10 at 1.30 p.m. at the Silk Sense Hoi An River Resort in Hoi An City seeks to discuss exactly that. The event will be organized by the Quang Nam Tourism Association in collaboration with the provincial Department of Culture, Sports and Tourism. It will be held under the auspices of the Quang Nam People’s Committee and sponsorship of Silk Sense Hoi An River Resort, Hoiana Nam Hoi An Development Co., Phu Ninh Lake Ecotourism and Hoi An Impressive Park, among others. The Saigon Times Group is the main media sponsor. Topics to be discussed at the seminar include a strategic market structure for tourism in the future, orientation for cruise tourism development, preserving heritage in tourism development, identifying tourism brands, digital and media technology solutions towards the experience tourism and green tourism models, increasing revenues from big data and the introduction of a green criteria for tourism in Quang Nam. “We believe the Covid-19 pandemic has caused serious damage. It is also an opportunity for us to look back on our past journey, forcing the community to come together to seek better ways to adapt to the crisis and plan further development,” said Nguyen Son Thuy, QTA’s General Secretary, adding, “It is also a good time to promote the green destination model.” Exports and industrial production bounce back in VN's biggest economic engine The export value of enterprises in Ho Chi Minh City witnessed a year-on-year increase of 6.3%, reaching nearly US$17 billion in the first five months this year, according to the city’s Department of Industry and Trade. In May alone, the city's export volume rose 10% from the previous month to US$3.384 billion, with key items like rice (up 47.7%), crude oil (up 30.6%), rubber (up 8.4%) and aquatic products (up 2.4%). China remained the largest importer of Ho Chi Minh City with nearly US$4 billion in five months, up 38.5% and making up 25.7%. It was followed by the US and Japan. Meanwhile, exports to the economies that signed free frade agreements with Viet Nam decreased in the reviewed period, in which exports to Europe fell by 11.6% to US$1.85 billion. According to enterprises located at the city's high-tech parks, since late April 2020, some firms have continuously launched measures to cope with impacts of the COVID-19 pandemic. In May 2020, the export value of businesses at high-tech parks obtained US$1.5 billion, up 10.7%. The Index of Industrial Production of the country's biggest economic engine in May picked up 7.9% against the previous month and dipped 15.5% compared to the same period last year./. Indonesia’s capital market attractive to foreign investors Foreign investors are starting to put their money back into Indonesian assets as countries around the world begin to ease their COVID-19 restrictions, spurring hopes of a global economic recovery. Data of the Financial Services Authority showed that foreign investors bought a total of 8 trillion rupiah (564.3 million USD) in Indonesian stocks in May. The capital inflows boosted the rupiah by 8.7 percent in the past month, reaching 13,877 rupiah per US dollar on June 5. The Jakarta Composite Index (JCI) benchmark stock gauge gained nearly 5 percent within a month. The 10-year sovereign bond yield also declined significantly to 7.1 percent from 8.02 percent in early May, indicating a decline in risk in investing in the instrument, as bond yields move in the opposite direction of stock prices. The global market is seeing an abundance of liquidity because central banks in developed countries have been injecting money to support their economies during the COVID-19 risis, BNI Sekuritas economist Damhuri Nasution said. The relaxing of mobility restrictions is sparking optimism among investors that COVID-19 is under control and that the global economy is starting to emerge back to normal, he added. Such optimism has sent foreign investors on a buying spree of Indonesian blue-chip banking stocks, driving up the JCI gains. Damhuri warned that the Indonesian government should keep a close eye on how the relaxation of restrictions could also pose a threat and reverse the positive sentiment in the market. Bank Indonesia (BI) recorded a current account deficit of 3.9 billion USD, 1.4 percent of the country's gross domestic product (GDP) in the first quarter of this year, down from 2.8 percent in the previous quarter./. Saudi Aramco withdraws from oil refinery project in Indonesia Saudi Arabian Oil Co., (Aramco) quit from Cilacap oil refinery project owned by Indonesia's energy firm PT Pertamina after a long discussion, said Pertamina Director Ignatius Tallulembang. Initially, both producers aims to settle the deal this year, but one of the largest global oil producers Aramco decided to pull out from the project, he said. The cooperation ended in April 2020 after being extended at the end of December 2019, he said, adding that Pertamina is finding new business partners while preparing for the next development process. With total investment of 5 billion USD, the project is expected to draw about 130,000 workers during the construction process, and 10,000 others while operating./. HCM City to organise fair to stimulate consumer demand Ho Chi Minh City’s Department of Industry and Trade will for the first time in several years allow businesses to offer promotions of up to 100 percent in June and July to boost demand that has taken a hit from the COVID-19 pandemic. For the last few years, businesses have not been allowed to offer one for one and other similar promotions except during national holidays like the Lunar New Year, Independence Day and Reunification Day. It will also allow free participation for businesses at the 2020 Consumption Stimulus Fair from July 2 to 5 in ThuDuc District. There will be supermarkets, malls and electronics retailers like Thien Hoa and Nguyen Kim participating in the programme, according to the department. It expects the event to boost economic recovery and normalise commercial activities in the city. The fair, financed by firms and the Government’s trade promotion funds, will have 500 booths showcasing consumer products, agricultural goods, foods, and export items. There will be promotional and discount programmes to stimulate consumption and help firms liquidate their stocks. Le Thi Thanh Tam, deputy director of Sai Gon Food Company, said her company would offer promotions of up to 50 percent and free trials of goods. Le Viet Thanh, director of K&K Fashion, said while major annual promotional programmes such as Black Friday and for Reunification Day (April 30) always attract a lot of customers, many shops mark up prices before them or sell old, counterfeit and poor-quality goods products that disappoint users. The department therefore needs to strictly control the quality of products to be sold at the fair and take severe action against businesses that violate buyers’ trust, he said. The promotions need to be promoted on different channels, especially social networks and digital media, to reach more young people, he said. The city should get banks and financial companies to offer low-interest loans at the fair for high-value of goods such as air conditioners to stimulate demand, he added./. Malaysia's economic stimulus to double deficit Malaysia’s fiscal deficit will nearly double to around 6 percent of the gross domestic product (GDP) this year because of the government’s recent efforts to revive the economy, according to Finance Minister Zafrul Abdul Aziz. He added that the government could seek to raise the debt ceiling to finance the stimulus. Malaysia has announced incentives worth 295 billion RM (nearly 70 billion USD) to cope with the impacts of COVID-19. The government vowed to directly inject 45 billion RM of that into the economy, mostly raised through domestic borrowings. Malaysia aims to bring the fiscal deficit back to under 4 percent of GDP in the next three years, according to the minister. He added that Malaysia’s public debt is now 52 percent of GDP, and the government could increase the ceiling to 55 percent in support of people and the economy. Hanoi seeks special mechanisms to speed up major infrastructure projects Ring roads No.4 and 5 would help ensure greater connectivity between Hanoi and other localities. The Hanoi city government is proposing special mechanisms to speed up two major infrastructure projects to build ring roads No.4 and 5, local media reported. Specifically, the special mechanism would be in forms of simplified policies so that the Ministry of Transport (MoT) and provinces and cities involved in the projects could fast-track them. Hanoi also suggested the MoT consider the construction of the entire ring road No.5 connecting eight provinces and cities to ensure better connectivity, while ring road No.4 is Hanoi’s priority project in the immediate future. The construction of the route connecting the Phap Van – Cau Gie section to Hanoi – Hai Phong expressway has a length of 13.9 kilometers and investment capital of VND9.8 trillion (US$420 million), to be built by a consortium of Phuong Thanh Transport Construction and Investment Company and Nguyen Minh Infrastructure Investment and Development Company under the build-operate-transfer (BOT) mechanism. Hanoi’s authorities are looking at three project proposals under the private-public partnership (PPP) made by domestic investors, including the expressway section Noi Bai – Lao Cai – National Highway No.32 – Phap Van – Cau Gie with a length of 34 kilometers and investment capital of VND16.2 trillion (US$694.36 million). Hoanh Son Corporation proposed the construction of Hong Ha bridge and its 6-kilometer approach roadway with investment capital of VND9.87 trillion (US$423.04 million), connecting Me Linh and Dan Phuong districts. For ring road No.5, as of May 2020, so far only a tiny section of it, the Vinh Thuy bridge across the Red river, has been completed with investment capital of US$170 million. Under a prime ministerial decision, ring road No.4 has a total length of 136.6 kilometers connecting Hanoi with Vinh Phuc, Hung Yen, Bac Ninh and Bac Giang provinces. Ring road No.5, once completed, would connect eight localities namely Hanoi, Hoa Binh, Ha Nam, Thai Binh, Hai Duong, Bac Giang, Thai Nguyen and Vinh Phuc with a length of 331.5 kilometers. Industrial park helps spearhead Hanoi’s supporting industries At full capacity, the industrial park could accommodate up to 2,000 enterprises and create 150,000 – 200,000 direct jobs. Hanoi Sourthern Supporting Industrial Park (HANSSIP) is considered a focal point in attracting both foreign and domestic investors in the field of supporting industries, Nhan Dan newspaper reported. HANSSIP was designed under the Japanese standard by design consultant firm Nikken Seikkei Civil for on-site production chains. The industrial park covers an area of 640 hectares and located in Hanoi's Phu Xuyen industrial satellite service urban area to the south of the downtown, adjacent to National Highway 1A and National Highway 1B - Phap Van Cau Gie. At full capacity, HANSSIP could accommodate up to 2,000 enterprises and create 150,000 – 200,000 direct jobs. Hanoi expects HANSSIP to be the driving force for Phu Xuyen, one of Hanoi’s five major satellite urban areas. To date, major global firms have landed at HANSSIP, including the Association of Japanese manufacturers of aircraft components in Kobe prefecture and Onaga, producers of aircraft components for Boeing and Airbus; South Korea – based MBI, which is specialized in manufacturing products using renewable energies; Japan Die and Mold Industry Association, among others. More importantly, the establishment of HANSSIP helped form Hanoi’s Association of Firms in Supporting Industries, which consists of 200 members being suppliers for multinationals such as Honda, Canon, among others. The significance of HANSSIP has been growing since the Covid-19 pandemic, during which the world saw a surge in demand for face masks, medical equipment or ventilators, but many of them could not be produced in Vietnam due to the lack of development of the supporting industries. With an investment capital of up to US$5 billion, HANSSIP is the first specialized supporting industrial park in Vietnam, while the government expects that HANSSIP will become a successful example in creating an impetus to drive up the country's supporting industries. In addition, enterprises participating in manufacturing supporting industrial products in HANSSIP according to the regulations of the Vietnamese government will receive special incentives regarding corporate income tax, import tax, VAT, personal income tax, among others. Malaysia reveals tax reliefs for real estate, automotive industries The Malaysian government will introduce several incentives to stimulate the property market and the automobile sector. The Home Ownership Campaigns (HOC) will be re-introduced, Malaysian Prime Minister Muhyiddin Yassin has said. Through this campaign, stamp duty exemption will be provided on the transfer of property and loan agreement for the purchase of home between 300,000 and 2.5 million RM (70,300 - 586,000 USD), he added. The exemption on the instrument of transfer is limited to the first 1 million RM of the home price while full stamp duty exemption is given on loan agreement effective for sales and purchase agreements signed between June 1, 2020 to May 31, 2021. In addition, the Malaysian government has also announced real property gains tax (RPGT) exemption for Malaysians for disposal of up to three properties between June 1, 2020 and Dec 31, 2021. As for the automotive industry, to encourage growth, the government has agreed to grant 100 percent sales tax exemption on sales of locally-assembled passenger vehicles, and 50 percent for imported passenger vehicles. This will be effective from June 15, 2020 to December 31, 2021. The Malaysian Automotive Association's President Aishah Ahmad welcomed the move, hoping that it helps the automobile sector of the country to recover./. Domestic businesses urged to boost export of medical supplies To capitalise on the global demand for medical protective equipment, Vietnamese companies need to proactively study markets, demand and quality standards, experts have said. The demand for personal protective equipment and other medical supplies is growing in several European and American countries as the COVID-19 pandemic continues to rage, providing an opportunity for Vietnamese businesses. Deputy Director of the Investment and Trade Promotion Centre of Ho Chi Minh City Cao Thi Phi Van told a recent seminar in the city that the garment industry was going through an unprecedented crisis due to COVID-19 but the pandemic also brought a significant opportunity for Vietnam to become the world’s face mask factory. Many garment producers hit hard by the pandemic have switched to producing masks. The demand for masks, protective equipment and medical gloves in the EU, the US and many other countries is very high whereas supply in the market is low because many factories have had to shut down to contain the spread of the disease. But with COVID-19 contained to a great extent in Vietnam, the country’s garment industry has moved into recovery mode and is stepping up production. Some have received export orders worth millions of dollars. Garment 10 Corporation Joint Stock Company said it has received orders for 400 million medical face masks from the US worth 52 million USD, 20 million cloth masks from another US partner and two million cloth masks and six million medical face masks from a German partner. With domestic demand fully met and surging demand in other countries, enterprises are keen on exports, but it is a unique product with medical standards to meet, and so many businesses have difficulty exporting, especially to the US and EU, Van said. Nguyen Tran Khanh Hoang, CEO of Super Cargo Service Company, an international logistics firm, said the difficulties most exporters of medical protective equipment currently face are their inability to furnish the documents required for customs clearance, not knowing the import process in destination markets, the lack of transportation options, and high logistics costs. Vietnamese businesses have no experience in exporting medical protective equipment, and so are not familiar with the requirements, leading to cases where they have shipped goods without necessary documents. Transportation has been disrupted in many areas, making it difficult for businesses to ship their products or very costly. Pham Thi Hoang Oanh, CEO of Indochine Vina Trade Promotion Co., LTd, said to take advantage of the opportunity to export medical protective equipment, businesses need to research information related to import markets./. Chinese firm to construct int’l tourist port in Phnom Penh China’s Prince Real Estate Group has planned to develop an international standard tourist port at Prince Manor Resort centre in Kandal province of Cambodia, according to the Cambodian news agency Agence Kampuchea Presse (AKP). The intention was unveiled by the firm’s Executive Director Xu Zhixing during a recent meeting with Cambodian Minister of Tourism Thong Khon in Phnom Penh. According to Xu, the port will allow his firm to run its cruise ships along Tonle Mekong River, thus promoting tourism development in Phnom Penh and across the Southeast Asian country. Khon welcomed and supported the Chinese company’s investment plan, stressing that the operation of the port will be a convenient recreational option when Cambodia as well as Phnom Penh hosts international events. He also suggested Prince Real Estate Group invest more in tourism in Siem Reap and Kampong Thom provinces. Cambodia is taking measures to recover its tourism sector which is crippled by the impact of the COVID-19 pandemic. Minister Khon on June 5 revealed Cambodia's tourism industry could lose 3 billion USD in 2020. According to the Ministry of Tourism, Cambodia welcomed about 1.6 million foreign tourists in the first four months of 2020, down 52 percent year-on-year./. Vietnam wants three expy sections built with State cash The Government has suggested changing the investment format of three sections of the North-South Expressway from public-private partnership (PPP) to State funding, reducing their combined capital to more than VND100.8 trillion, according to the Thanh Nien Online website. Minister of Transport Nguyen Van The presented the scheme to the National Assembly. The Ministry also suggested utilizing the public investment format for three PPP projects -- Vinh Hao-Phan Thiet section, Mai Son-National Highway 45 stretching 63 kilometers and Phan Thiet-Dau Giay section stretching 99 kilometers. The latter two projects are regarded as important because they connect with key political and economic centers in the country. The three projects have total revised capital of some VND100.8 trillion, compared with roughly VND102.5 trillion approved in the feasibility study. Of this, around VND67.9 trillion will be spent on building and equipment, VND15.4 trillion on compensation and resettlement, VND8.3 trillion on backup cost, VND1.3 trillion on interest payment and VND7.7 trillion on project management and consulting. Regarding funding, the Government suggested using VND78.4 trillion from the State budget including the VND55 trillion previously allocated for the projects. For the remaining VND23.4 trillion, the Government will present a mobilization solution to the National Assembly following the Law on Public Investment. Record lychees sold via MoMo e-wallet More than 8 tonnes of lychees were sold out after 8 hours available online via MoMo e-wallet, said the Saigon Union of Trading Co-operatives (Saigon Co.op) on June 10. The sales are part of the post-COVID-19 “Supporting Vietnamese farm produce” programme run by Saigon Co.op, MoMo, and Tuoi Tre (Youth) Newspaper. Lasting until June 30, the online event gives MoMo users discount prices and delivery services when buying thieu lychees, a unique fruit grown in the northern province of Bac Giang’s Luc Ngan district, and ST Xuan Hong rice. In the first day of the programme – June 10, the highest discount of 30 percent was applied to Thieu lychees. As such each kg of the fruit costs only 19,600 VND (0.85 USD) compared to the original price of 28,000 VND. According to statistics, in the first three hours after the programme opened, each customer ordered an average of 5 – 10 kg of lychees. However, the figure later escalated quickly to 30 – 50 kg, and even to a record number of 90 kg. As of 4:30 pm, over 8.2 tonnes of lychees and 200 kg of rice were sold. Buyers will get the products shipped to their places within two or three days./. Vietjet offers promotional tickets Vietjet on June 10 announced a promotion of 2.5 million super-saving tickets priced from only 8,000 VND (0.34 USD) across the domestic flight network in order to celebrate the launch of eight new routes. Promotional tickets are up for grabs at website www.vietjetair.com and Vietjet Air mobile app until the end of June 11. The flight period is from September 6 to December 31 this year, except eight new routes applied from June 18 to October 24, 2020 (excluding national holidays), according to Vietjet. These new routes, available for sales from June 9, include ones connecting Hanoi with Dong Hoi in Quang Binh province, Hai Phong with Quy Nhon in Binh Dinh province, Vinh with the pearl island of Phu Quoc and the coastal city of Da Nang with Phu Quoc, Da Lat, Buon Ma Thuot in Dak Lak province, Vinh, Thanh Hoa province./. VNS/VNA/VIR/SGT/VOV/ND/Hanoitimes/Dtinews/SGGP |
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NA passes resolution on National Election Council personnel 02:09 The National Assembly (NA) passed a resolution on the morning of June 12 ratifying the Vice Chairpersons and members of the National Election Council, with 92.96 percent of the deputies voting in favour.  The NA passes a resolution on the morning of June 12 ratifying the Vice Chairpersons and members of the National Election Council, with 92.96 percent of the deputies voting in favour. (Photo: VNA) The National Assembly (NA) passed a resolution on the morning of June 12 ratifying the Vice Chairpersons and members of the National Election Council, with 92.96 percent of the deputies voting in favour. The council comprises four Vice Chairpersons and 16 members. The Vice Chairpersons are Politburo Member and NA Vice Chairwoman Tong Thi Phong, Politburo Member and Deputy Prime Minister Truong Hoa Binh, Secretary of the Party Central Committee and President of the Vietnam Fatherland Front Tran Thanh Man, and Member of the Party Central Committee and Vice State President Dang Thi Ngoc Thinh. Those in the council then presented themselves before the meeting. NA Chairwoman Nguyen Thi Kim Ngan, who was elected Chairperson of the council on June 11, stressed the significance of the election of deputies to the 15th legislature and all-level People’s Councils for 2021-2026 to the operation of the State apparatus from the central to grassroots levels, especially the institutionalisation of resolutions to be adopted at the coming 13th National Party Congress and Party Congresses at all levels. On behalf of the council, she pledged to closely coordinate with relevant agencies and organisations to well perform tasks as defined in the Constitution and laws. Also on the morning of June 12, 93.37 percent of the deputies agreed to ratify a resolution on the election of a member of the NA Standing Committee./. VNA |
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Việt Nam opposes China's illegal activities in East Sea02:14 Việt Nam has condemned China’s reported laying of submarine cables in the Hoàng Sa (Paracel) archipelago as illegal and invalid.  The spokesperson for the Ministry of Foreign Affairs Lê Thị Thu Hằng during Thursday's press briefing in Hà Nội. — VNA/VNS Photo Lâm Khánh Foreign ministry spokesperson Lê Thị Thu Hằng made the statement on Thursday during a briefing in Hà Nội in response to reports from vessel tracking software and satellite imagery indicating a Chinese ship might be conducting installing undersea cables in the area. “Việt Nam has sufficient historical evidence and legal basis to assert its sovereignty over the Hoàng Sa (Paracel) and Trường Sa (Spratly) archipelagoes in line with international laws,” Hằng said. All activities conducted related to these two archipelagoes without express approval from Việt Nam constitute serious violations of Việt Nam’s sovereignty and are totally invalid, Hằng said, adding that all countries need to act responsibly, refrain from complicating the situation, and make helpful contributions to security and peace in the South China Sea (referred to as East Sea in Việt Nam). During the briefing, media also asked about Việt Nam’s reaction to a diplomatic note sent from the US to the UN Secretary General’s office to protest China’s expansive claims in the South China Sea as “inconsistent with international law,” referring to a 2016 arbitral ruling that rejected China’s nine-dash line. Việt Nam expressed interest in the fact that many UN members have submitted diplomatic notes conveying their stances on the South China Sea, Hằng said, adding that these notes are common practice in the UN. Việt Nam’s stance on the South China Sea and issues regarding sovereignty, sovereign rights and other maritime rights have been clear, consistent and reiterated multiple times, the spokesperson said. “The international community along with the United Nations always appreciates its members’ respect for, promotion of and compliance with international law, including UNCLOS 1982,” Hằng said. US anti-racism protests Regarding widespread protests in the US over the death of a black man in police custody, Việt Nam’s Government is closely following the situation and shared concerns with the US government and people over the spates of riots and violence that threaten the economy or safety and livelihoods of the people, Hằng said. Amidst this uncertain background, the Ministry of Foreign Affairs has instructed its mission in the US to stay updated on the protests and to keep in touch with the Vietnamese community in the US to carry out citizen protection measures when needed. Earlier, the Vietnamese embassy in the US recommended Vietnamese citizens avoid travelling to protest areas and to strictly observe local authorities’ regulations. Vietnamese citizens are asked to contact local police and the Vietnamese representative agency in the US should they require assistance. So far, there have been no reports of Vietnamese citizens being affected by the ongoing protests. Ready for EVFTA Việt Nam is ready to implement Europe-Việt Nam Free Trade Agreement (EVFTA) and Europe-Việt Nam Investment Protection Agreement (EVIPA), Hằng said, adding that the EVFTA is slated to take effect starting this August after both Vietnamese and EU parliaments ratified the deal, while the EVIPA still awaits approval from EU members. The two deals will help promote Asia-Europe ties and investment and business activities, enhance economic liberalisation based on transparency and equity, Hằng said. EU was the biggest export market of Việt Nam after the US in 2019, with total import-export turnover reaching US$56.4 billion. The EVFTA, the EU's most ambitious trade deal with a developing economy, is expected to help Việt Nam’s GDP increase by 2.2-3.3 per cent in the first five years after taking effect. VNS |
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Developing new-style rural areas aims to improve people's quality of life02:22 Developing new-style rural areas in Việt Nam has left positive changes to the face and development of the country’s rural areas and incomes of rural people, Deputy Prime Minister Trịnh Đình Dũng said on Thursday.  Children in Hải Đông Commune, Hải Hậu District in the northern province of Nam Định run on the road that was built as part of the local infrastructure improvement under new-style rural area building programme. — VNA/VNS Photo Công Luật Dũng, also head of the National Steering Committee for the National Target Programme on New-Style Rural Area Building, said more resources were being invested in agriculture and rural areas. The incomes of people living in rural areas had improved but the income gap was still large, showing both positive and negative sides, he said. “Changes have been made to create new motivations for development but negatively speaking, the changes’ impacts have not spread as widely as expected,” he said, adding that everyone was expected to benefit from the changes. “Developing new-style rural areas is not solely to open a new road or build a new public work. Its main goals are to improve life quality and increase incomes for farmers,” Dũng said. He said that although rural areas were trying to meet criteria that make them new-style rural areas, some had not paid proper attention to developing industrial production and promoting their traditional trade or tourism potential. “Building new-style rural areas must closely link with urbanisation, industrialisation and modernisation,” he said. “The growth of urbanisation, industries and services helps create jobs, change the labour structure, leading to a decrease in the number of rural workers/farmers. As a result, average farming land per head will be increased, thus people have advantages to develop production and improve their lives.” “Also, when agricultural production is developed, it will support the development of other industries, services and labour in urban areas,” Dũng said, adding that links among rural and urban areas, among agriculture and industrial production and services, remained unsystematic and lacked supporting policies. Deputy Minister of Agriculture and Rural Development Trần Thanh Nam said 5,177 communes, accounting for more than 58 per cent of total communes across Việt Nam, have met the standards of 'new-style' rural areas in the last 10 years. Nine provinces and cities in the country reportedly had all their communes recognised as new-style rural areas. Among 664 districts in 45 major provinces and cities in the country, 127 districts were titled “new-style rural areas”. Meanwhile, 45 districts in the remaining 21 provinces/cities do not have any communes qualified as new-style rural areas. Nam said at least 80 per cent of total communes nationwide were expected to meet standards of new-style rural areas in the next five years. Now, 19 criteria are used to assess the development and improvement of communes in terms of infrastructure, irrigation, electricity, environment, income, education, healthcare, social security and culture. Nine criteria are used to assess districts. Deputy Minister Nam said the criteria would be adjusted to increase decentralisation and increase flexibility when assessing localities’ performance in building new-style rural areas. The changed criteria were also expected to encourage disadvantaged communes/districts to continue seeking recognition between 2021 and 2025. VNS |
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VIETNAM'S BUSINESS NEWS HEADLINES JUNE 14 01:05 SBV eyes tightening non-bank credit in corporate bonds, property
The State Bank of Viet Nam is looking to tighten credit in corporate bonds and the real estate sector provided by non-bank financial institutions with an aim to ensure the safety of the system. Recently, the central bank made public for comments a draft circular about limits and safety ratios in the operation of non-bank credit institutions. Under the draft, non-bank financial institutions must keep six ratios within limits to ensure safety in operations, including a minimum capital safety ratio, restrictions on providing credit for corporate bonds and shares, solvency ratio, maximum ratio of short-term capital sources used for medium and long-term loans, ratio of investing in Government bonds and Government-guaranteed bonds and limits on capital contribution and share purchase. The minimum capital safety ratio aimed to enhance the financial institution’s resistance to market shocks. Under the draft, the minimum capital safety ratio would be 9 per cent, the same as the current regulation. However, the risk coefficients were adjusted higher for risk-weighted sectors, such as the high-end property sector. Accordingly, credit guaranteed by houses and land ownership rights provided for individuals to buy social housing units or worth below VND1.5 billion each would have the risk coefficients of 50 per cent, same as the current one. However, the risk coefficient would be 120 per cent from January 1, 2021 to December 31, 2021 and 150 from January 1, 2022 for receivables from individuals worth VND4 billion or higher. The central bank said that this aimed to tighten credit for individuals into the high-end property segment. With this regulation, non-bank financial institutions would be more cautious and stricter in controlling loans for real estate businesses, which would contribute to minimising risk when the property market moved and making the real estate market healthier and more stable, the central bank said. The central bank said that this regulation would not affect the demand for loans for purchases of social housing units for homes worth below VND1.5 billion, adding that it would also not affect non-bank financial institutions with good financial capacity and high capital safety ratio. Regarding the regulation about restrictions on providing credit for investing in corporate bonds and shares, the central bank said that this aimed to limit loans which would be used to invest in corporate bonds and shares which had high potential risk recently. The draft also added a regulation that non-bank credit institutions were not allowed to provide credit for customers to invest in bonds of companies which were their subsidiaries. In 2019, the central bank issued Circular 22.2019/TT-NHNN about safety ratios for operation of credit institutions and foreign banks’ branches which also tightened credit for sectors with high risks, including the property sector. Business community prepared for EU trade agreement Minister of Industry and Trade Tran Tuan Anh said the top priority now for the business community is not necessarily to enter the European market right away but to identify ways to exploit the EVFTA and EVIPA in an effective and sustainable manner that benefits both local companies and the country’s economy. Small and medium-sized enterprises are the most vulnerable during the implementation of the trade pacts, so ensuring they benefit while adhering to the provisions must be a priority for all business sectors. Tax and trade facilitation incentives are expected to greatly help Vietnamese enterprises expand their markets and improve their competitiveness. In order for local players to fully benefit, however, strategies that are appropriate for each business sector need to be completed. The EVFTA is the most ambitious trade deal Vietnam has ever signed. Tariffs on Vietnamese goods exported to Europe will be cut by 97% immediately for a period of seven years. For Vietnam’s business community to benefit as much as possible from the trade deals, the Government has undertaken to help local companies comply with requirements and rules./. Merger to be discussed at shareholder's meeting: Haraco Details on a plan to merge the Hanoi Railway Transport JSC (Haraco) and the southern Saigon Railway Transport JSC (Saratrans) will be discussed at Haraco shareholders meeting next week, according to a letter from its board of directors. "In order to improve the company's business efficiency, details on a plan to merge Haraco and Saratrans will be discussed at Haraco's upcoming shareholder's meeting, set to take place on June 15,” the letter stated. Haraco, Saratrans and the Transportation and Trade JSC - a freight train specialist - form the country's largest railway transport business, the Vietnam Railways (VNR). With Haraco and Saratrans holding a dominant market share on railway passenger transport. The merging is part of a VNR's effort to restructure its business and investments. VNR aims to recall some of its capital by cutting down its share and maintaining a 51 per cent share in the three companies. Haraco's main transport routes including the Ha Noi - Hai Phong, Ha Noi - Dong Ðang, Ha Noi - Lao Cai and the North-South. The company began its equitisation in 2015 with a registered capital of more than VND800 billion (US$34 million). At the time VNR was its largest shareholder with 91 per cent. Haraco (HRT) has been registered on UPCoM since 2016. Since equitisation - a process to convert a former State-own enterprise into a public company in Viet Nam - Haraco has reported large sales figures but with little to no profit to show for it. For instance, the company reported it net more than VND2.5 trillion in 2019 but only a small profit-after-tax of VND13.8 billion and a gross loss of VND71 billion. Last year, the company's sale target was set at more than VND1.6 trillion with a projected loss of VND355 billion. Haraco has made sizable investments in an effort to renew its fleet with the largest project to-date to build an additional 200 cars at a cost of over VND550 billion. Saratrans held its shareholder's meeting last month but made no note of the merger plans. Sustainable production and responsible consumption project launched The Viet Nam Rural Industries Research and Development Institute (VIRI) under the Ministry of Science and Technology on Saturday introduced sustainable products from a project in the central province of Thua Thien-Hue. Funded by the USAID Green Annamites, the project aims to develop livelihoods for forest-dependent locals, reducing their dependence on forests resources via wildlife hunting and non-timber forest product exploitation. Through a market-oriented value chain approach, VIRI and USAID Green Annamites have promoted sustainable production and responsible consumption of local products like medicinal plants and handicrafts. The project is expected to generate direct income for about 280 people and link the markets for some co-operatives and small- and medium-sized enterprises in the province. In addition, 2 per cent of sales revenue will be raised from participating entities to contribute to the local community forest management and protection fund. With a value chain approach, they will support local people in natural rattan harvesting techniques as well as standard planting and harvest process of medicinal plants. They will also enhance the management and business capacity of affiliates and co-operatives to meet market demands and add value to products. The project will also help strengthen co-operation among people, co-operatives and businesses to ensure stable output for the products. In addition, the project will support the construction of three elite networking centres in Hue and a communication channel through Facebook, helping co-operatives and businesses participate in trade fairs. The hope is consumers will understand that buying and using local products contributes to improving the livelihoods of ethnic minorities, as well as protecting forests and biodiversity. Indonesia builds industrial park to welcome US, Japanese investors The Indonesian government plans to build an industrial park serving Japanese and US plants relocated from China amid the US – China trade tension. Indonesian industry minister Agus Gumiwang Kartasasmita said in a statement on May 29 that the construction of the Brebes Industrial Park is based on Presidential Regulation Number 79 issued in 2019 on accelerating development in the country’s Central Java, which targets an economic growth of 7 percent. The Brebes IP is targeted to be a core industrial centre for the textile, leather and footwear, food and beverage, furniture, pharmaceutical and medical equipment. State-owned enterprise PT Wijayakusuma Industrial Estate has been assigned as the developer and manager of Brebes, with no further details given on the investment for the project. The master plan and feasibility study are expected to complete in July 2020, Kartasasmita said, hoping that related land acquisition of 3,976 hectares for the development of the park can be realised soon. This area covers three sub-districts, namely Bulakamba, Tanjung, and Losari. Industrial parks are part of Indonesia’s national priority projects in 2020. Indonesian President Joko Widodo has recently approved 89 infrastructure projects to build this year./. Cambodian agriculture unlikely to absorb laid-off workers: WB Cambodia’s agriculture sector is unlikely to be able to substantially absorb laid-off workers from the garment and tourism industries, according to a World Bank report. In a report titled, “Economic Update for Cambodia in the time of COVID-19,” it notes the weak performance of the farming sector. The bank says recent efforts to modernise the agriculture sector have intensified as Cambodia endeavours to increase productivity within its major crops. In this regard, there are signs that the sector is slowly modernising by leveraging advanced cultivation techniques and new seeds made possible by technology diffusion via foreign direct investment, it said, adding that while it is still too early to draw conclusions, Cambodia’s exported agricultural products have slowly expanded to include new products such bananas and soon mangoes. Meng Sakphouseth, country programme officer to Cambodia for the International Fund for Agricultural Development (IFAD), said that the agriculture is the sector that can most easily temporarily absorb seasonal workers. However, farming is not the first choice for many young Cambodians because they prefer to work in industry or the tourism sector. IFAD said it is working with the Cambodian government to leverage a programmatic approach to ease the economic distress and prevent food security stresses caused by the COVID-19 pandemic. The collaboration is focusing on addressing the immediate economic needs of rural communities by creating opportunities for returning migrant agricultural workers and expanding prospects for smallholder farmers through enhanced production support. The global COVID-19 outbreak has severely affected the services sector, especially the hospitality and tourism industry, which provides 620,000 jobs and hundreds of thousands of garment workers. According to the World Bank, at least 1.76 million jobs are currently at risk because of the COVID-19 outbreak. The collapse of the growth drivers has not only hurt economic growth but has also caused unemployment to soar to nearly 20 percent./. Three more air routes to promote domestic tourism Three more air routes from Vinh city of the central province of Nghe An to key tourism destinations in the country will be launched as part of efforts to promote post-pandemic domestic tourism recovery, said the Vietnam Airlines Corporation. Accordingly, the route connecting Vinh to Phu Quoc island district of the Mekong Delta province of Kien Giang will run four flights per week, beginning on June 12. Meanwhile, the routes linking Vinh and the Mekong delta city of Can Tho and Nha Trang city in the south central coastal province of Khanh Hoa will kick off on June 22, each operating three flights per week. The new routes are expected to help push trade and tourism connection between Nghe An and other north central provinces with the above localities. Nghe An aims to serve 5.1 million tourists and earn over 5.2 trillion VND (over 222.9 million USD) in revenue in 2020, up 8.5 percent and 17 percent year-on-year, respectively./. Online business cannot save Soya Garden? Cutting the number of physical stores as well as shifting to online business could save the beverage store chain Soya Garden from the COVID-19 crisis? The beverage startup Soya Garden most recently announced to close nearly 30 stores across the country due to no ability to keep surviving during the pandemic. That is completely contrary to its previous strategy – open stores as much as possible. According to its CEO Hoang Anh Tuan, the chain target to introduce 100 stores last year, and will raise to 300 in 2021. However, under the impact of the COVID-19 lockdown that has interrupted the operation of a string of F&B companies. As a result, the firms, including Soya Garden, jointly filed a document crying for help to the local government to be supported during the tough time. Indeed, running store chain business model has put many F&B companies on edge because it requires companies developing the number of stores that are big enough to cover the market. Consequently, every establishment required such a large cost for operation, including land leasing expenses. Major chains, over the past time, have been pleased to spend huge expenditures to be located at the favourable positions. Last year, Soya Garden beat the coffee, milk, and tea chain Phuc Long in gaining the golden place on the roundabout at 6 Phu Dong (Ho Chi Minh City) at the leasing price of $25,000 per month, doubling the previous price of Phuc Long. Nevertheless, as soon as the nation came into social distancing, their difficulties have steadily revealed. Specifically, every operation was halted, resulting in no earnings and lacking the ability to pay many kinds of expenditure, including the out-of-sight land leasing price. Facing this dilemma, many F&B chains have accelerated their shift from offline to online as an obliged solution. And Soya Garden cannot be out of the trend. An expert in the F&B industry revealed that online business only occupies about 30 per cent of the revenue structure of an F&B company. Thus, even as they boost online channels to mitigate the shortfall at physical stores, earnings may see a significant drop. Moreover, price is one of the main reasons behind its weak performance. In Vietnam, soya milk is sold at a small price, about less than 1 US dollar for a litre. However, a cup of soya milk in Soya Garden is put on trade at VND40,000-50,000 ($1.7-2.17), the same price of bubble tea items that are very popular in the market. Due to the inappropriate price, Soya Garden stores are commonly in a muted sense. Entering one of its stores on Hang Bun street (Ba Dinh district, Hanoi) last year, the establishment only saw a tiny number of customers. Meanwhile, nearby bubble tea stores were always crowded. Hence, the weak performance of Soya Garden indeed stemmed from the lack in penetrating local customers’ taste then applying the improper business model for a kind of product that is very familiar to Vietnamese people. Southeast Asia through Gojek investment Pouring capital into Gojek right after entering the e-commerce sector, what ambitions is Facebook harbouring? The ride-hailing circle last week was astonished by news that the social networking site announced an investment in Indonesia-based Gojek that is present in Vietnam under the name of Go-Viet. Accordingly, Facebook has been working on expanding to emerging markets as well as seeking partners for its WhatsApp application. This is the second-largest deal Facebook has conducted the last seven weeks. In April, the US-based platform purchased 10 per cent of Indian Reliance Jio at $5.7 billion. Despite not revealing the value of the investment, Gojek most recently announced that it has received more than $3 billion from its Series F investment round. This suggests that along with the recent investment of PayPal, Facebook's capital in Gojek is not small at all. Facebook is planning to set up an e-commerce platform linked with WhatsApp and integrated payment features. Currently, companies running business on Facebook can also use WhatsApp as a tool to interact with customers. “This investment will support Facebook and Gojek’s shared goal of empowering businesses and driving financial inclusion across the archipelago. WhatsApp helps small businesses communicate with customers and make sales, and together with Gojek, we believe we can bring millions of people into Indonesia’s growing digital economy,” Facebook said in a blog spot. The ambition is also reflected by its launch of the new feature named Shops last month – which is very similar to online shopping platforms and is seen as a direct offensive to break into e-commerce. The tool supports businesses in setting up virtual stores to sell items both on Facebook and Instagram. Thus, with the latest move of injecting capital into Gojek, Facebook may be nursing aspirations of dominating Southeast Asia where the market is shaped by Singaporean e-commerce giant Shopee and ride-hailing platform Grab. Meanwhile, Gojek is a big counterpart in the area, so using the Indonesian player as a jumping board to enter the market is a good choice. In addition to Facebook, Gojek is backed by Google, Tencent, and Singaporean fund Temasek. The startup's value was assessed at $10 billion in the latest investment round and is now the largest unicorn in Indonesia. Housing projects proposed to sell land parcels: Ministry Housing projects not located in any urban districts, except Ha Noi and HCM City, are permitted to sell land lots. This is the regulation proposed at the end of May by the Ministry of Natural Resources and Environment in the latest version of the draft amending and supplementing Decree 43 on specific regulations for a number of articles in the Land Law, including conditions for transferring land use rights at housing projects. According to the April version of the amended draft, the housing projects nationwide are not allowed to sell land lots. Real estate experts said the ban of selling land lots would have strong impact on the domestic real estate market and it is very difficult to implement this ban. Nguyen Tran Nam, chairman of the Viet Nam Real Estate Association said the proposal on banning the sale of land lots is not suitable with both legal and practical issues, causing many difficulties for businesses and the people. The ministry has the ban with good target of stopping illegal actions in trading land lots to cheat buyers over past time, Nam said. The fault is real estate market management of local authorities but not due to the regulations. Nam said the market has high demand on trading land lots for investment while the State could collect tax from transferring land use right. The problems on the land lot market at present included not close management for the market of the authorities and intransparent information about planning of housing projects in particular and the property market in general, he said. Le Xuan Nghia said most of Vietnamese real estate enterprises are small and medium sized ones with limited financial capacity so they have often had land lot projects to recover capital quickly, ensuring cash flow to develop new larger projects. Nghia said giving approval for selling land lots should depend on each housing project and each location because the general construction planning at present is not synchronised. Tran Kim Chung, deputy director of the Central Institute for Economic Management, said the market still has demand on trading of land lots so the State should not ban this activity. The permission of selling land lots is a policy decision and the issuance of this decision should be suitable with the practice. Pyn Elite Fund divests capital in HCM City Infrastructure Investment Pyn Elite Fund, a Finnish fund which focuses on Vietnamese shares, on Monday announced it had sold nearly 337,000 shares of the HCM City Infrastructure Investment JSC (CII). After the sale, the fund cut its ownership in CII from 8.1 per cent to 7.96 per cent. On March 20, the fund also sold more than 1.4 million shares of CII.On March 26, it sold 66,810 shares and 1.5 million shares on April 7. CII Investment Director Duong Quang Chau recently registered to sell 200,000 CII shares from May 19 to June 17. In the General Meeting of Shareholders held early this month, CII proposed two scenarios for 2020 business results. In the first scenario, CII set a revenue target of VND5.8 trillion (US$249.3 million) and post-tax profit of VND808 billion. In a more plausible scenario, the company hopes to achieve revenue of VND6.6 trillion and profit of VND1.6 trillion. The company plans to issue 1.24 million bonds in conjunction with warrants, known as warrant-linked bonds, for existing shareholders at the rate of 200:1. This means a shareholder can buy one bond for every 200 shares they own. The total amount of capital raised through bond issuance is expected to exceed VND1.2 trillion. The company also plans to issue 160 million shares to the public at a price of VND10,000 per share. CII closed Monday at VND19,250 per share. Kien Giang calls for investment in agriculture development The Mekong Delta province of Kien Giang is calling for investment in agriculture and rural development projects in Go Quao district. According to the provincial Department of Agriculture and Rural Development, the projects will focus on the fields of water supply, farm produce processing, hi-tech vegetable and fruit cultivation, development of concentrated cattle and poultry slaughter facilities, and production of rice varieties. Vo Van Tra, Chairman of the district People’s Committee said these projects are part of the locality’s socio-economic development strategy. It is in line with the agriculture restructuring plan of Kien Giang province in general and Go Quao district in particular, Tra added. The locality hopes to attract 100 billion VND (over 4.3 million USD) to construct five clean water plants with a capacity of 1,200 cu.m each in Vinh Thang, Vinh Phuoc B, Vinh Phuoc A, Vinh Hoa Hung Bac and Thoi Quan communes; and 188 billion VND (over 8 million USD) for fruit, rice and pepper processing plants in Vinh Hoa Hung Bac and Vinh Hoa Hung Nam communes. Meanwhile, hi-tech vegetable and fruit cultivation zones in Dinh An and Dinh Hoa communes, and concentrated poultry slaughter and rice variety production establishments in Dinh Hoa commune, are expected to get a total investment of 52 billion VND (2.2 million USD)./. Collective economy – cooperatives forum scheduled for third quarter The 2020 national forum on collective economy and cooperatives will be held in the third quarter, with the number of participants expected to reach about 500. Themed “connection, cooperation for mutual development – a trend for cooperatives’ growth in the era of the 4th industrial revolution”, the event will gather Party and Government officials, representatives of authorities and cooperative alliances across the 63 cities and provinces nationwide, experts, scientists, and businessmen, among others. Participants will discuss the foundation for the construction and development of the collective economy, which are collaboration and connection among cooperative members, between cooperatives, and between cooperatives and other economic sectors. Deputy Prime Minister Trinh Dinh Dung has asked the Ministry of Planning and Investment and the Vietnam Cooperative Alliance to coordinate in organising the event. The People’s Committees of centrally-run cities and provinces, meanwhile, have been requested to engage in activities of the forum and get prepared to answer questions related to issues to be tabled. On the sidelines, there will be a space displaying products of some cooperatives. As of June 2019, Vietnam had 14,502 agricultural cooperatives, 55 percent of which operated efficiently, much higher than the 15 percent in 2015. Along with reducing production cost for member households, the cooperatives helped increase their income by 14 percent per year./.  Quang Ninh - ideal destination for foreign investors The northeastern province of Quang Ninh has emerged as an ideal destination for investors who want to diversify production activities and expand their supply chains outside China. "For investors operating in Guangdong (China), Quang Ninh is a destination worth considering in the plan to relocate production bases to Vietnam," said Pritesh Samuel, an expert from Dezan Shira & Associates Company. According to the expert, Quang Ninh is considered a strategic investment destination in northern Vietnam and an important link of the northern economic growth triangle Hanoi - Hai Phong - Quang Ninh. The province has great advantages with Van Don district planned to become a multi-sectoral marine economic zone, and an entertainment center with casino, high-class sea-island tourism, and general services, he explained. In addition, this is also the gateway for international trade, creating unique, modern and high-quality products which can be internationally competitive, he went on. Therefore, foreign investors expect Van Don district and Quang Ninh in general to be an important business center that is convenient for trade connectivity with China and ASEAN, he added./. Vietnamese firm exports 1 million masks to US JSC Central Pharmaceutical I (Pharbaco) has shipped 1 million face masks to the US. Pharbaco is the first pharmaceutical business in the north to be licensed for exporting masks to the US. Earlier, the firm completed orders from Poland and Hungary. Pharbaco is capable of producing 20 million of face masks per month. The company is importing more machines to increase its production capacity. Vietnam exported 415.7 million face masks worth 63.19 million USD in the first four months of 2020, according to the General Department of Customs. Japan was the biggest importer of made-in-Vietnam face masks in the period, with 32.7 million, followed by the Republic of Korea, Germany, and the US, with 17.1 million, 11.1 million, and 10.4 million, respectively./. Southern Focal Economic Zone benefits from smart farming Smart farming has played an important role in developing agriculture in the Southern Focal Economic Zone. In the past few years, smart farming has been used successfully in many localities in the zone, attracting great attention from farmers and the business community. The HCM City-based Quang Trung Software Park has introduced a number of smart farming models, including ones that use LED lamps and systems to grow vegetables in containers with high output and quality. According to figures from the HCM City Department of Agriculture and Rural Development, agricultural land accounts for over 46 per cent of the land in the zone compared to just 34 per cent in HCM City. Dr Từ Minh Thiện, deputy chief of the HCM City Hi-tech Agricultural Park, said ecological agriculture and improvement in quality were both needed. The zone should be developed into a national centre for hybridisation with laboratories that use advanced technologies and create new innovative technologies for agricultural use. It should also build brand names for regional specialities. HCM City had led the way in smart farming models for farmers and the business community. Thiện said its Department of Agriculture had focused on the development of sustainable urban agriculture "using biotechnology and is a hub for developing high–quality plant and animal varieties”. This acted as an impetus for sustainable agricultural development in the Southern Focal Economic Zone. "Smart farming also can help turn HCM City into a centre for technology, including biotechnology," he said. Statistics from the Việt Nam Chamber of Commerce show that investment in the zone accounts for only 1 per cent of total investment in agricultural development in Việt Nam and 3 per cent of companies’ investments in business and production activities. Ninety per cent of investment in agricultural development is from small and medium-sized enterprises. Thiện said relevant agencies had yet to issue policies to promote smart farming and tech companies had not focused on agriculture. Thai Cabinet approves e-business tax draft law Thailand’s Cabinet on June 9 approved a draft bill allowing the government to collect VAT from electronic services, as proposed by the Ministry of Finance. With that move, Thailand has become the latest country in Southeast Asia to seek to boost tax revenue from international technology companies. The bill requires non-resident companies or platforms that earn more than 1.8 million THB per year from providing digital services in the country to pay a 7 percent VAT on sales, deputy government spokeswoman Ratchada Thanadirek was quoted by the Bangkok Post newspaper as saying. Thailand is expected to add about 3 billion THB (95.6 million USD) to its coffers annually from the move, which will affect services such as music and video streaming, gaming, and hotel booking./. Webinar discusses new tools for firms to seek partners amid COVID-19 A webinar was held by the Investment and Trade Promotion Centre of Ho Chi Minh City (ITPC) on June 9 to discuss new connection tools for businesses to access foreign partners amid the COVID-19 pandemic. Speaking at the event, ITPC Deputy Director Cao Thi Phi Van said thanks to the successful containment of the pandemic, Vietnam has started resuming production and business activities and been viewed as a safe destination by foreign investors. However, the country’s export-oriented economy has been still badly hurt by the disease since many of its major markets are under lockdown and global trade has been disrupted by travel restrictions, Van said. To recover foreign trade, domestic firms must take advantage of IT platforms to maintain connection with traditional partners and seek new importers, and make them adaptive to the pandemic which may be far from over. Echoing her view, CEO of Source of Asia Thiery Mermet said the COVID-19 pandemic has not only caused stagnant production but also disrupted connection between partners. Sellers and buyers are no longer able to directly interact with each others, adding more challenges to market forecasting and significantly reducing business opportunities, he said. Amidst the COVID-19 outbreak, firms have two options, he continued, the first is to reduce their production scale and wait for the disease to end and the second is to actively renovate themselves and come up with new business strategies and new marketing tools. The first one is safer but only those who choose to change can make use of gaping holes in the global supply chains and be fully prepared when the pandemic ends, he explained. Director of international relations at SOA Blandie de Quatrebarber suggested Vietnamese businesses to employ digital tools to seek new customers, saying they should make their products regularly available on online platforms, such as websites and social media, and maintain close contact and become familiar with customers and their culture. Firms must be aware that online business can become more trending in the coming time as it helps save costs and time so they need to find suitable marketing tools and strengthen connection with providers of supporting services in foreign markets so as to promptly and effectively gain access to the markets, experts said./. German media laud opportunities from EVFTA The European Union – Vietnam Free Trade Agreement (EVFTA), recently ratified by the Vietnamese legislature, will not only help Vietnam boost production and exports but also enable European firms to increase their presence in this emerging Asian nation, said the German media. The DPA newswire said once the deal takes effect in early August, 99 percent of all tariffs on both sides will be cut after seven years. The EVFTA will allow Vietnam, which is already one of the world’s fastest-growing economies, to increase its export turnover to the EU by about 20 percent by 2020 and 44 percent by 2030, it said. Meanwhile, the DW said the FTA with Vietnam is the EU's most ambitious trade deal with a developing country. The deal is set to give the Southeast Asian country a much-needed economic boost amid the coronavirus pandemic. In ratifying the deal, Vietnam committed to implementing sustainable development standards, protecting labour rights and to uphold its pledges to tackle climate change under the Paris Accord. The Finanznachrichten cited Vice President of the Federation of German Wholesale, Foreign Trade and Services Ines Kitzing as saying that the deal not only creates an economic driving force but also offer a clear answer to protectionism under the disguise of COVID-19 crisis. General Manager of the Federal Association of the German Footwear and Leather Goods Industry Manfred Junkert, for his part, said opportunities for German producers in Vietnam rely on how Vietnam overcomes the pandemic as well as financial capability of domestic enterprises. He also hailed Vietnam as a promising market for German leather and footwear. Last year, Vietnam was the second largest supplier of footwear to Germany./. PetroVietnam to cut crude oil exploitation costs during 2020-2025 The Vietnam Oil and Gas Group (PetroVietnam) has set a goal of reducing average crude oil exploitation costs in order to sustain business during the 2020-2025 period, even if crude oil price drops to 30 USD per barrel. During the third congress of the Party organisations at PetroVietnam for the 2020-2025 tenure in Hanoi on June 9, General Director Le Manh Hung said the group is facing difficulties during 2015-2020, especially in exploration and exploitation. Secretary of the Party Committee and Chairman of the Board of Directors at PetroVietnam, Tran Sy Thanh, asked the group to focus on two key tasks. The first is following the Resolution adopted by the fourth plenum of the 12th Party Central Committee on Party building and rectification while preventing and driving back degradation in political thought, moral virtue, and lifestyle. The second is improving corporate governance to achieve set goals, especially those regarding production and trade as well as finance, and paying attention to petrol price forecasts to better control risks, he said. PetroVietnam will put into operation Lot B and the Ca Voi Xanh gas fields, the largest in Vietnam, during the 2020-2025 period. The group’s total revenue in 2015-2020 is estimated at 3,397 trillion VND (over 146.37 billion USD) and State budget contributions at 592 trillion VND. After-tax profit is expected to reach 170 trillion VND. It expects to tap 25-30 million tonnes of oil equivalent each year after 2024./. ASEAN’s economic growth could bounce back to 8 pct by 2021 Economic growth in the ASEAN region could rebound to an average 8 percent in 2021 after falling into recession in the first half of 2020, a report suggested on June 8. The report, written by Oxford Economics and commissioned by the Institute of Chartered Accountants in England and Wales (ICAEW) suggested that most Southeast Asian economies will fall into recession in the first half of 2020 before recording a 1.9 percent contraction for the full year. The report said Thailand will be one of the worst hit in the region because tourism and travel account for 20 percent of its gross domestic product (GDP). On the other hand, Vietnam will emerge the least affected with its lead in unwinding measures as compared to other regional peers, although it is not immune to the sharp slowdown in trade flows, the report said. The adverse impact on Southeast Asian economies is forecast to turn the corner in the second half of 2020 as Chinese import demand and global trade recover at a consistent pace, while a slower pace of normalisation will continue to weigh on tourism-dependent economies, according to the report. It added that coordinated fiscal stimulus packages and monetary easing from authorities across the region will support the recovery in economic growth. On the whole, the COVID-19 pandemic is likely to cause the global economy to shrink by 4.7 percent, it noted. This is more than double the impact of the global financial crisis in 2008 and will be the biggest global recession in post-war history./. Singapore, France agree to keep supply chains for essential food connected Singapore and France have agreed to maintain open and connected supply chains for essential food supplies during the COVID-19 pandemic. The agreement was reached during a recent video conference between Singapore’s Ministry of Trade and Industry and France’s Ministry of Agriculture and Food. The two sides said it will facilitate the flow of agricultural products. The two ministries will work with relevant service providers in aviation and sea transportation. They will also facilitate partnerships and collaboration between food companies, importers, and distributors of their two countries. Singapore is also discussing reopening borders with Malaysia. Philippine economy to contract 1.9 percent in 2020: WB The Philippine economy is projected to contract 1.9 percent this year due to the economic fallout triggered by natural disasters and COVID-19, the World Bank said in an updated report released on June 9. In this report, the WB said the eruption of Taal Volcano and the global COVID-19 pandemic, including the strict containment measures against the epidemic, have led to severe disruptions in manufacturing, agriculture, tourism, construction, and trade. The cumulative impact of these events on the economy has been broad-based and deep, halting investment activity and leading to the lowest consumption growth in three decades, according to the report. The report said growth forecast for 2020 assumes that the containment measures will gradually ease in the second half of the year, and economic activities return in some sectors of the economy. Given income losses and heightened uncertainty, household consumption and private investment are expected to remain weak. However, it added, economic growth prospects and poverty figures are expected to improve in succeeding years driven by a rebound in consumption, a stronger push in public investment, supportive fiscal and monetary policies, and the recovery of global growth. The Philippines' economic growth is predicted to return to above 6 percent in 2021 and 7 percent in 2022, the report said, noting that the Philippines' strong fundamentals, built over decades of structural reforms, have helped the economy to cope with the COVID-19 pandemic. Capitalising on EVFTA sure to be a challenge The EU-Vietnam Free Trade Agreement (EVFTA) is expected to provide a host of opportunities to Vietnamese enterprises to bolster their exports, but they must also meet strict requirements in order to fully capitalise on the deal, insiders have said. Vu Duc Giang, Chairman of the Vietnam Textile and Apparel Association (VITAS), said the National Assembly’s ratification of the EVFTA on June 8 is “good news” for the sector, which has suffered from COVID-19 in recent times, as businesses will have opportunities when the agreement takes effect. The EU is currently the world’s largest importer of textiles and garments, with 34 percent of the global total each year worth more than 250 billion USD in value. Vietnamese products account for just 2.7 percent of the EU’s imports. Giang said companies in the sector believe in the prospect of exports to the EU rising after the EVFTA comes into effect, as tariffs will be slashed to zero percent. Textile and garment shipments to the market are forecast to increase sharply from now to 2025, by about 67 percent compared to a non-EVFTA scenario. However, the VITAS chairman noted, businesses need to be thoroughly prepared to make use of the opportunities and have a solid grasp of the regulations within the agreement, because the EU is a demanding market with strict requirements on product quality and design. Just one simple fault may damage all export activities, he said, explaining that a batch of goods with unclear origin or indeterminate quality may expose similar batches to stricter inspections or even an import ban. Phi Viet Trinh, General Director of the Ho Guom Garment JSC, said that in order to benefit from the preferential tariffs under the EVFTA, products must have a certain proportion of materials hailing from the EU or Vietnam. This is a major challenge because most input materials in Vietnam are currently imported from China or other ASEAN countries. Therefore, management agencies and businesses alike must take certain action to maximise the opportunities, he stressed. The official added that it is necessary to promulgate policies to attract domestic and foreign investment in material production. Mechanisms in particular are needed to promote links between material suppliers and manufacturers of finished products to meet rules of origin requirements. Of a similar mind, General Director of the Garment 10 Corporation Than Duc Viet said the EVFTA will open up numerous opportunities but Vietnam must work hard to fully benefit. The EU is ready to import Vietnamese goods but such products must comply with rules of origin, he noted, voicing a hope that the textile and garment industry can grasp the available opportunities. Nguyen Quoc Tuan from Vinh Thong Co. Ltd, a footwear exporter to Europe, said the company’s operation has been hindered by COVID-19 since the beginning of the year but now he expects the EVFTA will boost exports over the remainder of 2020. Nevertheless, he also acknowledged that the company will encounter a range of difficulties in adhering to the agreement’s rules of origin, as while 60 percent of its input materials come from domestic suppliers the remainder come from elsewhere, primarily China. Updating technology and expanding production scale are also problematic given that the company’s internal resources remain modest. Nguyen Van Khanh, Vice Chairman and Secretary General of the Shoe and Leather Association of HCM City, said local leather and footwear enterprises should try and immediately put the EVFTA into full use despite up to 85 percent of them lacking capital, technology, and materials. It is also not easy to meet rules of origin requirements when 60 percent of materials are from China and other suppliers, he added. Experts predict that in the short term, the EVFTA may not give a strong boost to the textile - garment and leather - footwear industries in Vietnam, but will certainly bring about long-term benefits for them in expanding their market share in the EU. A number of enterprises have also voiced a hope that when foreign investors realise that Vietnam now has even greater potential, technology transfer and investment in material production will grow./. Kien Giang calls for investment in agriculture development The Mekong Delta province of Kien Giang is calling for investment in agriculture and rural development projects in Go Quao district. According to the provincial Department of Agriculture and Rural Development, the projects will focus on the fields of water supply, farm produce processing, hi-tech vegetable and fruit cultivation, development of concentrated cattle and poultry slaughter facilities, and production of rice varieties. Vo Van Tra, Chairman of the district People’s Committee said these projects are part of the locality’s socio-economic development strategy. It is in line with the agriculture restructuring plan of Kien Giang province in general and Go Quao district in particular, Tra added. The locality hopes to attract 100 billion VND (over 4.3 million USD) to construct five clean water plants with a capacity of 1,200 cu.m each in Vinh Thang, Vinh Phuoc B, Vinh Phuoc A, Vinh Hoa Hung Bac and Thoi Quan communes; and 188 billion VND (over 8 million USD) for fruit, rice and pepper processing plants in Vinh Hoa Hung Bac and Vinh Hoa Hung Nam communes. Meanwhile, hi-tech vegetable and fruit cultivation zones in Dinh An and Dinh Hoa communes, and concentrated poultry slaughter and rice variety production establishments in Dinh Hoa commune, are expected to get a total investment of 52 billion VND (2.2 million USD)./. PM receives leaders of Chinese firms operating in Vietnam Prime Minister Nguyen Xuan Phuc hosted a reception in Hanoi on June 12 for leaders of Chinese businesses which are investing in the fields of garment and textile, high-quality fibre, engine components and automobile tyres in Vietnam. PM Phuc said amid the impacts of the COVID-19 pandemic on many firms, including foreign-invested companies, the Prime Minister, and leaders of ministries and localities have often met with enterprises and business associations to remove their difficulties. Regarding Vietnam’s success in the fight against the pandemic, he said the country has taken timely and drastic reactions to put the disease under control, thus bringing the life, production and business activities back to normal. PM Phuc said he had early held phone talks with his Chinese counterpart Li Keqiang to discuss ways to step up cooperation and share experiences in combating COVID-19, adding that Vietnam had also donated medical supplies to China. At the meeting, representatives of Chinese firms expressed their belief in the determination of the Vietnamese government and local administrations in implementing the dual goal of boosting socio-economic development and containing the pandemic as well as opportunities offered by the EU-Vietnam Free Trade Agreement (EVFTA), the EU-Vietnam Investment Protection Agreement (EVIPA) and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Welcoming the businesses’ intention to expand investment, PM Phuc said China is currently Vietnam's largest importer and second biggest exporter. In return, Vietnam is the top ASEAN trade partner of China, with bilateral trade reaching 120 billion USD last year. China has invested in nearly 3,000 projects worth nearly 21 billion USD in Vietnam so far, and this amount of capital is equivalent to 5.5 percent of the total foreign investment registered in the country. As a result, China now ranks seventh among 136 countries and territories investing in Vietnam. A number of Chinese enterprises are operating profitably in various sectors in Vietnam, the PM said, noting that the two countries have also been cooperating well in tourism. As both countries have managed to bring the COVID-19 pandemic under control, Vietnam is considering the reopening of some commercial air routes with China, firstly Guangzhou, to promote trade and travel, he said. Listening to the firms’ opinions, PM Phuc said the Vietnamese Government will continue facilitating the entry to and exit from the country for foreign experts, business managers, investors and skilled workers, including those from China. At the meeting, the PM also highly valued major Chinese investors’ capability, serious attitude and investment effectiveness, including in expanding production and business activities, complying with environmental protection regulations, caring for their employees, and boosting exports, which have generated benefits for themselves and Vietnam. He particularly applauded many businesses’ decision not to lay off workers despite difficulties caused by the COVID-19 pandemic, noting that their examples should be popularised for other firms to follow. The Vietnamese Government will order ministries and sectors to deal with problems facing Chinese enterprises, including resuming flights and facilitating logistics services, the PM said, adding that it will ensure macro-economic stability and create more optimal conditions for businesses. WB, Phu Yen form partnership for strategic engagements The World Bank (WB) in Vietnam and the People’s Committee of south-central Phu Yen province have signed a Memorandum of Understanding establishing a partnership for strategic engagements. At the signing ceremony in Hanoi on June 12, WB Country Director in Vietnam Ousmane Dione expressed his pleasure to expand support for Phu Yen’s efforts to build a sustainable marine economy and boost regional economic integration. The WB said the framework will enable Phu Yen to better leverage the lender’s global knowledge, financial resources and convening power to achieve its socio-economic goals and realise the vision of becoming an industrial and tourism hub for Vietnam and Southeast Asia. Priority areas include mainstreaming urban resilience, delivering high-quality and efficient infrastructure services and fostering development in tourism and fishery sectors. Phu Yen has outperformed the nation in average GDP growth since 2008. Locating at a crossroad in the south-central region of the country, and having nearly 200km of coastline, the province holds great potential to become a critical link for economic exchange in the region. The two sides will establish a platform to conduct regular and strategic discussions, share knowledge and lessons learned, and pool and leverage resources and expertise. They will collaborate on a wide range of initiatives, including support for the local Socio-economic Development Plan for 2021–2030, smart city and e-governance initiatives, and public-private partnerships. Petrol prices rise in latest review Retail petrol prices rose sharply from 3pm on June 12 - the third hike in the past month - following the latest review by the Ministry of Industry and Trade and the Ministry of Finance. The two ministries review fuel prices every 15 days to ensure domestic prices are in keeping with the global market. The price of E5 RON92 biofuel increased by 988 VND to a maximum of 13,390 VND (0.57 USD) per litre and RON95-III by 955 VND to no more than 14,080 VND per litre. Diesel 0.05S and kerosene, meanwhile, now sell at no more than 11,515 VND and 9,610 VND per litre, up 766 VND and 853 VND per litre, respectively. The price of Mazut 180CST 3.5S is now no more than 10,322 VND per kg, an increase of 830 VND per kg. According to the two ministries, the prices of petrol and oil in the global market have been on the rise on the back of increasing demand as countries have begun resuming production and business activities. The ministries also decided to use 800 VND per litre from the petrol price stabilisation fund for E5 RON92, 500 VND per litre for RON95, and 200 VND per kilo for mazut. Fruit, farm produce week opens in Hanoi The second fruit and farm produce week kicked off in Hanoi on June 11 with the participation of over 20 cities and provinces nationwide. Sixty pavilions were set up at the fair, offering hundreds of local specialties such as Bac Giang, Hung Yen, Hai Duong lychee, Son La mango and plum, and Ninh Thuan grapefruit. At the opening ceremony, MM Mega Market Vietnam and some localities exchanged memoranda of understanding, pledging to support sales of farm produce this year. The event will run until June 15. Seminar explores financing options for rooftop solar power installation The Electricity of Vietnam (EVN) in Ho Chi Minh City hosted a seminar on June 11 to discuss solutions to develop and finance rooftop solar power installations in the country’s southern hub. During the event, participating solar energy solution providers introduced various options for businesses, organisations and homeowners to purchase their own rooftop solar power systems. Nguyen Duy Thinh from SolarBK, a leading solar power producer in Vietnam, said if a company has a rooftop of 3,000 – 10,000 sqm, SolarBK is ready to co-finance from 70 – 100 percent of the solar project’s total cost. Vietnam Eco Solutions (VES) and TTC Energy have also rolled out similar deals to co-invest in rooftop solar power projects. HB Bank representatives said it is offering loans with preferential interest rates for customers who borrow to install a rooftop solar energy system. By March, the bank had provided a total of 1.2 trillion VND (51.32 million USD) in loans for enterprises and homeowners to develop this kind of projects across the country. As of the end of May, a total of 7,341 solar power systems, with a combined capacity of 94.49 MWp, had been installed in Ho Chi Minh. Since 2017, 102 rooftop solar power projects with a combined capacity of 37.23 MWp have been connected to the city’s grid. ADB – HCM City’s important development partner: municipal leader Ho Chi Minh City appreciates contributions of the Asian Development Bank (ADB) to its socio-economic development, and always considers the bank an important development partner, a municipal leader has said. At a reception for ADB Country Director for Vietnam Eric Sidwick on June 11, Chairman of the HCM City People’s Committee Nguyen Thanh Phong thanked the bank for its timely financial assistance and policy consultation to developing member countries, including Vietnam, in the fight against COVID-19. He also thanked the bank for its support to HCM City in mitigating the pandemic impact on the progress of projects using ADB loans in the locality. HCM City suggested the ADB facilitate its access to preferential loans for Metro Line No. 2, the first phase of Metro Line No. 5 and the sustainable urban transport project for Metro Line No. 2. Sidwick said Vietnam is one of the very few countries in the world that have not experienced growth decrease despite of the pandemic. ADB not only supports Vietnam’s development programmes but also learns from and shares the country’s experience with other countries, especially in fighting the epidemic and maintaining economic growth. COVID-19 has partially affected the progress of ADB-funded projects in HCM City, but the bank is resolved to implement its commitments to financial support and technical advice to the city, he said. Following the meeting, Vice Chairman of the HCM City People’s Committee Vo Van Hoan and the ADB Country Director for Vietnam signed a memorandum of understanding (MoU) on cooperation between the two sides. Under the MoU, the HCM City and the ADB will conduct regular consultations, improve the efficiency of the existing projects using ADB loans, identify potential projects and promote the development of the private economic sector and the involvement of different sectors in the city’s socio-economic development. Phong lauded the signing of the MoU, saying its implementation would contribute to advancing collaboration between the two sides. Sidwick said under the deal, the two sides can seek the best working methods for both. PM welcomes Exxon Mobil’s investment in Vietnam Prime Minister Nguyen Xuan Phuc told President of Exxon Mobil LNG Market Development Inc. Irtiza Sayyed during a phone talk on June 11 that Vietnam welcomes the group’s plans of investment in Vietnam. He said Vietnam is among countries that are able to early contain the COVID-19 epidemic and is striving to seize the opportunity for development. During the process, the country has great demand for power, so the Vietnamese Government welcomes Exxon Mobil’s investment in a complex of ports, LNG storage facilities and LNG-fuelled power plants using advanced technology in Hai Phong. The PM said with a total capacity of 4,000 MW, this project will help boost the development of not only Hai Phong but also the entire northern key economic zone. Phuc also appreciated Exxon Mobil’s plan to build a gas-fired power complex with total capacity of 3,000 MW in the southern province of Long An. The group will ensure stable LNG supply for the power complex from the US and other countries. The import of LNG from the US will contribute to a more harmonious trade balance between Vietnam and the US, he said. Sayyed praised Vietnam for containing the COVID-19 epidemic with effective measures, which he said will create a safe and reliable environment for international investment and trade in the country. VNN |
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