BUSINESS NEWS OCTOBER 10,vietnam economy,Vietnam business news,business news,vietnamnet bridge,english news,Vietnam news,vietnamnet news,Vietnam latest news,Vietnam breaking news,Vietnamese newspaper,Vietnamese newspaper articles,news vietnam

Through merger and acquisition (M&A) activities and the improvement of goods quality and services, Vietnamese retailers are trying to win the support of local customers and compete with foreign rivals.

Statistics reveal that Vietnam’s annual revenue from retail sales and services has risen significantly in recent years.

Of note, domestic retailers have engaged in various M&A transactions to expand their market shares since the beginning of the year.

In late August, VinMart, run by VinCommerce under Vingroup – Vietnam’s leading real estate and retail conglomerate, acquired eight supermarkets of Queenland Mart, raising its total number of supermarkets to 120. Currently, Vingroup owns 2,122 supermarkets and convenience stores.

Last April, VinCommerce said it will acquire convenience store chain Shop&Go for 1 billion USD.

Saigon Union of Trading Cooperatives (Saigon Co.op) also took over all supermarkets of French company Auchan Retail last June.

According to the Ministry of Industry and Trade, domestic retailers make up 84 percent of the market share. Besides, they have expanded their network, meeting the huge demand of locals.

Experts said 2019-2020 will witness fierce competition between domestic and foreign retailers, as well as modern and traditional retail channels, requiring domestic retailers to make greater efforts to gain a firm foothold in the market./.

HCM City could become logistics workforce training hub: experts

Developing Ho Chi Minh City into a supplier of high-quality human and technological resources for the logistics industry was the subject of a recent conference held in the city by the HCM City Department of Industry and Trade in coordination with the Vietnam Logistics Research and Development Institute.

Speaking at the event titled “Project for Development of the Logistics Sector in HCM City until 2025, with a vision to 2030”, Hoang Minh Tri, a former head of the HCM City Institute for Research and Development, said the city should also become a hub for logistics workforce training for the Southern Focal Economic Zone since it has many top universities, hi-tech parks and research laboratories.

To turn the city into a logistics hub would require a lot of land and a large workforce, which would worsen the congestion plaguing it, he said.

Besides, this was not envisaged in its master plan for economic development approved by the Government in 2010, he pointed out.

The city planned to develop clean industries which do not harm the environment, and use advanced technologies which do not requires a large workforce, he said.

HCM City has two major infrastructure facilities, Tan Son Nhat International Airport and Cat Lai port, both overstretched.

Tan Son Nhat is crowded both inside and outside and any increase in goods transport or logistics services would make these traffic problems even worse, raising transportation costs.

Construction of a flyover to ease traffic outside the airport cost over 10 million USD but it would require 10 times that amount to clear the congestion at Cat Lai.

Furthermore, traffic congestion and pollution affect people’s lives and have a negative impact on the efforts to attract foreign investment.

For these reasons, HCM City should be developed into a human resource hub for the Southern Focal Economic Zone, supplying labour for the Cai Mep – Thi Vai Port Complex (in Ba Ria – Vung Tau province) and preparing to do the same for the proposed Long Thanh International Airport in Dong Nai province, Tri said.

Once construction of Beltway Nos 3 and 4 and the Ben Luc – Long Thanh – Dau Giay Highway is completed, goods from the Mekong Delta could be directly transported to the Long Thanh International Airport and the Cai Mep – Thi Vai Port Complex bypassing HCM City, he added./.

Central city to host start-up innovation event

Leading speakers from home and abroad will address the Fourth Da Nang Start-up Innovation Festival on November 1.

Vice director of the city’s science and technology department, Tran Van Hoang said at a press conference on Wednesday at least 30 speakers and experts along with 2,000 businesses, students and investors will join the event.

Peter Vesterbacka is a global entrepreneur and brand communities creator from Finland; Dominic Mellor, the leader of the Mekong Business Initiative of the Asia Development Bank; Jan Lederman, President of Valhalla Private Capital, Canada; founder of Viet Nam Silicon Valley Thach Le Anh; Shark Tank and director of Cyber Agent Investment Foundation Nguyen Manh Dung and other domestic and foreign speakers will all take part.

Hoang said activities including an exhibition of 70 business start-up projects, start-up pitching and business meetings will prelude the conference from October 28-31.

He said the city has established three private funds reserving for start-up projects since 2016.

This year’s event will focus on start-up projects in fields of information technology, tourism and agriculture, aiming at promoting the city’s innovative start-up ecology system for the future.

The city’s business start-up ecosystem debuted in 2014 as a base for the younger generation to begin their careers. Three hundred start-up projects, of which 10 received funding from investors, were born from the ecosystem’s co-working space.

In 2017, the Song Han Incubator Centre, which was seen as the first private sector incubator, was debuted as a consultancy for young people starting businesses.

The centre has supported 40 start-up projects in tourism in Da Nang and HCM City.

Last year, two projects received VND7.7 billion (US$335,000) from investors.

Da Nang has 18,000 businesses, 95 per cent of which are small and medium-sized enterprises.

The city plans to support 200 projects and 80 start-up businesses, in which at least 20 per cent of businesses will successfully call fund from investors, in 2020.

During the occasion of hosting the conference, Da Nang will debut its first Adventurous Fund in supporting start-up businesses.

HAGL offloads entire stake in realty arm

Agriculture group Hoang Anh Gia Lai (HAGL) has transferred its 47.93 per cent stake in the property arm Hoang Anh House Construction and Development JSC to Dai Quang Minh Real Estate Investment Corporation.

HAGL sold all 196.37 million shares in the realty unit for an unknown value, the company said in a statement this week.

The associate firm, known as HAGL Land, has charter capital of VND2 trillion (US$86 million). As of June 30, HAGL had total VND2.53 trillion worth of assets in HAGL Land.

HAGL once held 100 per cent ownership in the real estate unit. In the third quarter of 2018, HAGL Land issued 125 million shares for VND13,414.63 ($0.58) per share in a private deal.

The deal helped HAGL cut its stake in the realty arm and recorded VND516 billion worth of profit.

The deal was carried out after HAGL and automobile manufacturer Thaco on August 8, 2018 announced a strategic co-operation agreement.

Under the agreement, Dai Quang Minh Real Estate Investment Corporation – a member of Thaco – will be in charge of developing the second phase of HAGL’s real estate project in Myanmar.

The total capital made in the project is estimated at VND7.4 trillion and the construction is scheduled to complete in 2020.

In addition to HAGL Land, the Vietnamese agricultural group also transferred its stakes in other member firms such as HAGL Agrico.

Selling stakes in member companies is a part of HAGL’s plan to exit non-core businesses and transform to a farming business from a multi-sector group.

In the second quarter of 2019, HAGL recorded VND513 billion of revenue, down 73 per cent yearly, and VND713 billion in losses. Six-month revenue was VND912 billion, down 68 per cent yearly, and the group suffered a loss of VND691 billion.

HAGL shares are listed on the Ho Chi Minh Stock Exchange with code HAG. They gained 1.5 per cent to end Wednesday at VND4,620 per share.

January-September foreign buying of local shares reaches more than $460 million

Foreign investors net bought a total VND10.8 trillion (US$464.4 million) worth of local shares from January to September with exchange-traded funds accounting for nearly half of the figure.

Foreign investors net bought VND10.27 trillion on the Ho Chi Minh Stock Exchange (HoSE) and VND1.27 trillion the Unlisted Public Company Market (UPCoM). Meanwhile, they net sold VND730 billion on the Ha Noi Stock Exchange (HNX).

Foreign investors tended to withdraw from frontier markets. It is attributed to the volatility of the global financial-equity markets due to the unpredictability of the US-China trade war and worries about the global economic recession. Those factors have forced investors to find safer investment targets such as gold and government bonds.

In the current condition, Viet Nam has emerged as a good destination for ETFs because of its higher-than-expected economic growth and stable exchange rates.

The General Statistics Office (GSO) reported last week local gross domestic product (GDP) climbed nearly 7 per cent in the first three quarters of 2019, reaching its highest level for the last nine years.

The amount of foreign direct investment (FDI) disbursed in nine months rose 7.3 per cent yearly to $14.2 billion.

Eight exchange-traded funds (ETFs) net bought VND4.7 trillion in the nine-month period, or 43.5 per cent of the total figure.

Of the eight ETFs, the US-based VanEck Vectors Vietnam ETF (VNM ETF) has net bought total $83.5 million since the beginning of the year. In its portfolio, Vinhomes, Vingroup and dairy producer Vinamilk are the top three investees.

VNM ETF is followed by the Vietnamese fund VFMVN30 ETF, the South Korean fund KIM Kindex Vietnam VN30 ETF, FTSE Vietnam ETF and SSIAM VNX50 ETF.

Net foreign buying focuses on large-cap stocks such as property firm Vingroup (VIC), Vietcombank (VCB), food and beverage firm Masan (MSN), PetroVietnam Technical Services Corporation (PVS), Quang Ngai Sugar JSC (QNS) and Minh Phu Seafood Corp (MPC).

Stocks that were net-sold were carrier Vietjet (VJC), the Vietnam Electric Equipment Joint Stock Corporation (GEX), realty firm Vinhomes (VHM), Sai Gon-Ha Noi Securities Corporation (SHS) and Binh Son Refining and Petrochemicals Co Ltd (BRS).

Strong foreign purchases for Vietnamese shares have helped boost the three stock indices in nine months.

As of September 30, the benchmark VN-Index gained total 11.6 per cent to stand at 996.56 points from last years end of 892.54 points.

The growth rates for the HNX-Index and UPCom-Index were 0.8 per cent and 7.5 per cent, respectively.

Housing prices rise slightly in third quarter

Housing prices in Ha Noi and HCM City increased slightly in the third quarter, according to an annual report from the Ministry of Construction released at a press conference on Monday.

Compared to the second quarter, apartment prices in Ha Noi rose by 0.21 per cent, while the price of individual houses increased by 1.25 per cent.

In HCM City, the price of apartments increased by 0.7 per cent in the country, while the price of individual houses rose by 2.7 per cent, compared to the second quarter of this year.

According to the Ministry of Construction, in the first nine months of the year, 98,700 houses were built for the poor in 56 provinces, with a total investment of VND2.4 trillion (US$103 million).

The Ministry also offered support and repaired housing for 17,219 households in areas prone to typhoons and floods, at a total cost of VND645 billion (US$27.8 million).

The ministry has completed 206 social housing projects with a total of 85,450 accommodations. Another 221 social housing projects with 180,000 accommodations are under construction.

The ministry has also invested in 100 social housing projects for workers in industrial zones.

The ministry noted that some localities continue to have real estate trade violations. It directed all city and provincial People's Committees to conduct strict inspections and handle any violation of the Land Law and Real Estate Law.

In addition, local authorities must develop solutions to stabilise the property market and promptly inform the public and other agencies about housing planning and infrastructure development projects, it said.

Firms advised to use derivative tools to minimise forex risks

Experts suggested firms use more derivative instruments, such as futures and forward contracts, to minimise exchange rate risks when they can no longer borrow the US dollar from commercial banks, starting early this month.

According the central bank’s new regulation, banks have been banned from lending in foreign currency to pay for imports since October 1 this year in a bid to limit dollarisation in the local economy. From that date, instead of borrowing foreign currency from banks, firms have to buy it from banks.

The regulation applies to both domestic banks and branches of foreign banks in Viet Nam lending to anyone who is a Vietnamese resident.

Previously, importers were allowed to take out loans in foreign currencies to pay for imports if they could prove they can generate enough foreign currency from their production and trading revenues to repay these loans.

Can Van Luc, Chief Economist of the Joint Stock Commercial Bank for Investment and Development of Vietnam (BIDV), said currently, many banks have provided derivative instruments so firms which want to buy foreign currencies in the future can use forward contracts. This tool helps reduce risks for firms because future exchange rates have been determined from the beginning.

According to Luc, the policy to stop foreign currency loans is in the anti-dollarisation roadmap and was announced early in the year so credit institutions have had time to prepare for the application of the new policy.

In general, he said, the relatively stable macro economy, low inflation and stable exchange rate have contributed to improving the confidence in the value of the Vietnamese dong, which is expected to continually help reduce the hoarding of the US dollar. The new policy thus will not cause difficulties for both banks and firms, but the central bank and commercial banks should still create a foreign currency trading market with better liquidity to further help firms and individuals in meeting their foreign currency demands.

The ban on foreign currency lending also helps raise the competitiveness of domestic goods and firms, experts said.

Banking expert Nguyen Tri Hieu said the new regulation would level the playing field between enterprises producing for domestic consumption and those importing for export production. Earlier, only the latter was privy to dollar loans that generally have lower interest rates than dong loans. Therefore, the ban would encourage production with domestic materials, he said.

Besides, this will also help restrict the import of luxury goods, one of the main factors causing trade deficit and macro-instability, especially towards the end of the year when demand for import of consumer goods puts pressure on liquidity in the forex market.

The SBV aims to reduce the proportion of foreign currency in total outstanding debt to below 7.5 per cent in 2020, below 5 per cent in 2030, and to stop lending in foreign currency altogether by 2030. The ratio currently stands at 8.73 per cent, which the central bank estimates at around VND176.47 trillion (US$7.59 billion). — VNS

Highest anti-dumping tax rate imposed on Chinese aluminium products

BUSINESS NEWS OCTOBER 10,vietnam economy,Vietnam business news,business news,vietnamnet bridge,english news,Vietnam news,vietnamnet news,Vietnam latest news,Vietnam breaking news,Vietnamese newspaper,Vietnamese newspaper articles,news vietnam

The Ministry of Industry and Trade (MoIT) has decided to officially impose the highest rate of anti-dumping duties on aluminium products originating from 16 Chinese producers.

Accordingly, six Chinese aluminium exporters will face the highest rate of 35.58 percent, eight others will face rates of between 18.16 and 35.39 percent, and the remaining two will be imposed tax with a rate of less than 10 percent.

The products are used to make aluminium doors, wattle walls, storage cabinets and interior and exterior decorations, as well as in construction. In addition, they are also used to make industrial machines and structures.

In January, the MoIT conducted an investigation into aluminium imports from China according to regulations from the World Trade Organisation and Foreign Trade Management Law, as well as losses to domestic manufacturers.

It found that Chinese aluminium was dumped at a margin of 2.49 percent to 35.58 percent. In some cases, prices of Chinese products were much lower than the production cost of the product in Vietnam. As a result, the domestic aluminium industry has suffered in recent years, causing losses to many businesses and forcing employees to quit their jobs.

On June 5, after a five-month investigation, the ministry temporarily applied the lowest anti-dumping rate of 2.46 percent on the Chinese aluminium products.

Last year, the amount of imported aluminium extruded bars from China to Vietnam reached 62,000 tonnes, double that of 2017. The figure excluded a large amount of imports to processing zones. Imports from other countries fell to 5,000 tonnes in 2018.

Also in 2018, the US conducted a tax evasion investigation on some extruded aluminium products imported from Vietnam. In mid-September, the US concluded some of them were evading anti-dumping duties the US has imposed on Chinese products. The US then announced a tax rate of up to 374.15 percent for those Vietnamese products.

According to the MoIT, with some of the local products on which the US imposed anti-dumping duties, there were a number of products with the mentioned Chinese exporters.

The ministry said the US move could seriously damage good aluminium manufacturers in Vietnam in terms of profitability and reputation, giving them competition with both the cheap imported products from China in the local market and earning a reputation and position in the international market.

It thought the imposition of anti-dumping duties this time will help reduce such pressure on domestic manufacturing enterprises as well as avoid tax-evading products from China.

According to regulations, anti-dumping measures will take effect within five years from the effective date of September 28./.

Forestry export value up 18.1 percent in first 9 months

Forestry exports were estimated to exceed 7.93 billion USD in the first 9 months of 2019, up 18.1 percent year-on-year, with a trade surplus of 6.06 billion USD.

Vietnamese timber and forestry products were shipped to more than 128 countries and territories, of which the US, Japan, China, the EU and the Republic of Korea were key markets. During the reviewed period, forestry shipments to these major importers earned 6.93 billion USD, or 87.4 percent of the total export value.

In September alone, Vietnam exported 890.8 million USD worth of the products, an annual increase of 22 percent from the same period last year.

According to the Vietnam Administration of Forestry, production between January and September had remained stable, with value hitting 31.66 trillion VND (1.36 billion USD), 4 percent higher than the same period last year.

Meanwhile, the amount of exploited timber and other forestry products was estimated at 11.4 million cubic metres, up 4.5 percent on-year.

Currently, northern provinces are accelerating their end-of-season forest planting, while their southern peers are kicking off their main season of the year./.

Vietnam’s industrial production hits four-year high

Vietnam’s industrial production in the first nine months of this year rose by 9.6 percent year on year, a four-year record, according to the General Statistics Office (GSO).

The manufacturing and processing sector led the industry sector and the whole economy with an expansion of 11.4 percent, while mining grew slightly by 2.7 percent after months of reduction.

Head of the GSO’s Industrial Statistics Department Pham Dinh Thuy said Vietnam’s manufacturing and processing sector had the highest growth rate among ASEAN nations.

“The domestic manufacturing and processing industry grew steadily over quarters, including 11.5 percent, 10.9 percent and 11.7 percent in the first, second and third quarters, respectively, ”Thuy said.

Among industries, several sectors recorded year-on-year growth, including coke and refined petrol up 38 percent, metallurgy 36 percent and rubber and plastics 15 percent.

Production of electronics, computers and optical products hiked by 6.3 percent, lower than the 14.2 percent growth a year ago, while production of cigarettes rose 4 percent.

Crude oil was down 7 percent, motorbikes 9.4 percent, mobile phone spare parts 11.1 percent and refined sugar 15.8 percent.

In the first nine months of 2019, the consumption index of the manufacturing and processing sector rose by 9.5 percent year on year.

Of which, some products had strong growth in consumption, such as coke and refined petroleum products (41.4 percent), metal products (28.5 percent) and rubber and plastic products (14.6 percent).

The inventory rate in manufacturing and processing sector hit 72.1 percent in the nine months, higher than the rate of 63.8 percent in the same period last year, according to GSO.

However, Thuy said, the high rate was temporary due to high stockpiles in some major fields, including petrol production, automobile production, motorbike, transport means and metal manufacturing industries./.

Firms advised to use derivative instruments to minimise exchange rate risks

Experts suggested firms use more derivative instruments, such as futures and forward contracts, to minimise exchange rate risks when they can no longer borrow the US dollar from commercial banks, starting early this month.

According the central bank’s new regulation, banks have been banned from lending in foreign currency to pay for imports since October 1 this year in a bid to limit dollarisation in the local economy. From that date, instead of borrowing foreign currency from banks, firms have to buy it from banks.

The regulation applies to both domestic banks and branches of foreign banks in Vietnam’s lending to anyone who is a Vietnamese resident.

Previously, importers were allowed to take out loans in foreign currencies to pay for imports if they could prove they can generate enough foreign currency from their production and trading revenues to repay these loans.

Can Van Luc, Chief Economist of the Joint Stock Commercial Bank for Investment and Development of Vietnam (BIDV), said currently, many banks have provided derivative instruments so firms which want to buy foreign currencies in the future can use forward contracts. This tool helps reduce risks for firms because future exchange rates have been determined from the beginning.

According to Luc, the policy to stop foreign currency loans is in the anti-dollarisation roadmap and was announced early in the year so credit institutions have had time to prepare for the application of the new policy.

In general, he said, the relatively stable macro economy, low inflation and stable exchange rate have contributed to improving the confidence in the value of the Vietnamese dong, which is expected to continually help reduce the hoarding of the US dollar. The new policy thus will not cause difficulties for both banks and firms, but the central bank and commercial banks should still create a foreign currency trading market with better liquidity to further help firms and individuals in meeting their foreign currency demands.

The ban on foreign currency lending also helps raise the competitiveness of domestic goods and firms, experts said.

Banking expert Nguyen Tri Hieu said the new regulation would level the playing field between enterprises producing for domestic consumption and those importing for export production. Earlier, only the latter was privy to dollar loans that generally have lower interest rates than dong loans. Therefore, the ban would encourage production with domestic materials, he said.

Besides, this will also help restrict the import of luxury goods, one of the main factors causing trade deficit and macro-instability, especially towards the end of the year when demand for import of consumer goods puts pressure on liquidity in the forex market.

The SBV aims to reduce the proportion of foreign currency in total outstanding debt to below 7.5 percent in 2020, below 5 percent in 2030, and to stop lending in foreign currency altogether by 2030. The ratio currently stands at 8.73 percent, which the central bank estimates at around 176.47 trillion VND (7.59 billion USD)./.

World Trade Centre in Binh Duong helps connect enterprises 

The World Trade Centre in Binh Duong New City (WTC BDNC) project in the southern province of Binh Duong is expected to connect enterprises and help local firms develop international trade, the provincial People’s Committee said on October 2.

As a member of the World Trade Centres Association (WTCA), the centre will connect its member businesses with more than one million enterprises worldwide. The project aims to develop Binh Duong into a dynamic locality with professional services and high-quality human resources, as well as an attractive destination for real estate projects.

 

Under the approval of the WTCA, the Investment and Industrial Development Joint Stock Corporation (Becamex IDC) will construct the complex with an international conference and exhibition centre, hotel, office and a metro station on Ho Chi Minh City’s Metro Line No.1.

The WTC BDNC project will be officially announced at the 2019 Horasis Asia Meeting on November 23.

Earlier, Becamex IDC asked the provincial People’s Committee to develop the project with the hope of increasing the proportion of services in the local economy, and to carry out the province’s breakthrough programmes during 2016-2020 which aim to improve the quality of human resources and urban area planning, and develop professional services./.

Cumbersome procedures hinder WTE projects

Investors in waste-to-energy (WTE) projects have had to carry out a series of complicated procedures required by ministerial to grassroots-level agencies before they can start work on their projects.

Ngo Nhu Hung Viet, general director of Vietstar JSC, told the Saigon Times that it took his company’s waste-to-energy project several years to be executed as it had had to undergo multiple procedures requested by the ministries of construction, investment, finance, environment, and so on.

It is now standard practice for enterprises to spend at least five years on these procedures, he said.

The Vietstar head proposed ministries carry out multiple procedures concurrently to shorten the time needed for investors to start their projects.

Speaking at the groundbreaking ceremony of the Vietstar waste-to-energy project in HCMC, Viet also petitioned the municipal government to reduce the time needed to complete each of the complicated procedures, so that the city can have a waste-to-energy plant by 2020 as planned.

Another investor told a press briefing in late August, before beginning work on three waste-to-energy projects, that authorities should work out measures to speed up investment procedures for investors to quickly execute their projects.

The proposals on time reduction were raised by the municipal chairman, Nguyen Thanh Phong, at meetings to discuss the city’s socioeconomic development.

In response, Nguyen Toan Thang, director of the HCMC Department of Natural Resources and Environment, said that the time needed to complete investment procedures and organize bidding sessions for waste-to-energy projects could be reduced from 786 days to 541 days.

As for the time-consuming bidding, Thang added that some procedures have to be done in accordance with prevailing regulations, so they cannot be streamlined further.

The chairman voiced concern over the 8,900 tons of waste being discharged daily in the city, excluding medical and industrial garbage. Waste burial has been the main treatment method used in the city to date. Due to the current cumbersome procedures for new plants, the city may run out of space to contain the high volume of waste.

Vietnam's exports to U.S. at record high

Vietnam exported US$44.9 billion worth of goods to the United States, its largest buyer, in the first nine months of 2019, making up 23.1% of the total export revenue and setting a new record for the country.

The export revenue over the nine-month period this year is nearly equal to the figure in all of 2018, at US$47.5 billion, according to statistics from the General Statistics Office.

Statistics indicate that the revenue from shipments bound for the United States between January and September rose by 28.2% year-on-year, marking the highest rise among the increases seen on Vietnam’s import markets, including Japan at 10%, South Korea at 8.1% and the ASEAN market at 4.7%.

Compared with the figure seen in the year to August, the revenue from exports to the United States grew an additional US$8.3 billion. The upward trend of shipments to the United States has emerged since April last year.

Exports to the United States were textiles and garments, phones and phone parts, handbags, purses and woodwork, among other items.

Meanwhile, Vietnam spent US$10.7 billion importing goods from the United States over the first nine months of 2019, up 12.6% year-on-year.

Joseph Incalcaterra, chief economist for ASEAN markets at HSBC, told a recent conference that Southeast Asian countries are seeking to raise their share in the U.S. market, noting that Vietnam has topped the list for this trend.

HSBC also forecast that revenue from exports to the United States in 2019 will exceed US$55 billion, cementing the market’s position as Vietnam’s largest importer.

Some have attributed Vietnam's stronger exports to the ongoing Sino-U.S. trade dispute.

Many economic experts have repeatedly pointed out that Vietnamese firms have not really benefited from the rise in exports to the United States as most of the goods shipped to America were produced by foreign-invested companies.

The General Statistics Office stated in its report on the January-September socioeconomic performance that foreign direct investment (FDI) firms still dominated goods shipments to foreign markets.

Phones and phone parts, electronics and components, footwear and textiles exported by FDI enterprises accounted for 96.6%, 90.1%, 76.3% and 59%, respectively.

Also, statistics show that in the year to September, the country’s export revenue amounted to an estimated US$194.3 billion, up 8.2% year-on-year. FDI firms earned higher export revenue than local exporters, accounting for 69.3% of the country’s total export turnover.

Shinhan Finance joins Vietnam Banks Association as 66th member

Shinhan Vietnam Finance Co., Ltd., a fully foreign-owned consumer finance company, has announced that it has become the 66th member of the Vietnam Banks Association (VNBA), effective from September 26, 2019 regarding VNBA approval No.31/QD-HHNH.

This development will see the company (Shinhan Finance) significantly increase the general welfare and usefulness of banking finance institutions and discussions of subjects of importance across the industry. Shinhan Finance and its customers will now benefit from a credible national network covering 66 members, including commercial banks, joint-venture banks, and many finance companies.

“The members of the VNBA are pleased to welcome Shinhan Finance as the newest member,” said Nguyen Toan Thang, general secretary of the VNBA.

“Becoming a member of VNBA, Shinhan Finance will have its relevant rights and interests protected by the VNBA in accordance with the laws and regulations of the Association. Additionally, it will be empowered to participate in many annual activities organised or co-hosted by the VNBA, such as conferences, seminars, forums, and training programmes.

“The company is also recommended to propose ideas to remove barriers and problems encountered during follow-up with state management agencies through the VNBA,” Thang added.

Atul Dixit, CEO of Shinhan Finance, said, “The VNBA helps to ensure policymakers understand the important role banks and financial companies play in Vietnam’s economic growth. As a member, we can add our voice to call on regulatory agencies and the administration to enact pro-growth policies that support a healthy financial market, encourage innovation, and remove impediments to serving customers effectively.”

“In turn, we follow the lead of the State Bank of Vietnam and support the stronger alliance by extending its connecting role forthe stable, effective, and healthy development of Vietnamese credit institutions and contribute to ensure the effective enforcement of monetary policies for the country’s socio-economic development,” he noted.

Mitsubishi to recall over 14,000 Xpander cars for fuel pump fault

Mitsubishi Motors Vietnam will recall 14,051 Xpander cars manufactured in Indonesia between August 14, 2018 and August 26, 2019 to fix a fuel pump problem.

The Japanese company said a fault in the plastic impeller on the inside of the fuel pump causes it [the impeller] to inflate, and this stops the pump from rotating, causing the engine to stall or fail to start.
While it has been unable to ascertain the exact cause of the problem, its investigation suggests that plastic impellers with a low molecular density inflate easily.

The recall will last from October 1 this year to September 30, 2021. The company will replace the fuel pump in all vehicles brought to authorized distributors for free.

The replacement is expected to take 72 minutes, the company said. It added that all vehicles manufactured after August 26, 2019, have been fitted with new fuel pumps.

According to figures from the Vietnam Automobile Manufacturers Association, Mitsubishi sold 16,386 vehicles in the first eight months this year for an 8.5 percent market share, including 9,904 Xpanders.

Xpander cars are also being recalled in Thailand and the Philippines.

West Hanoi – the highest rental yield rates of all districts

In Hanoi's ever-changing real estate sector, investors have been keeping their eyes on the office segment of West Hanoi – the new hotspot of the capital.

According to CBRE's report, only one new Class A and two Class B office buildings were launched in 2019's second quarter. The three buildings occupied about half of Hanoi’s new office supply at the time.

During the quarter, both Class A and B offices recorded positive results. The average rental yield of Class A offices rose by 5.3 per cent on-year, equaling $26.4 per square metre per month (excluding service fees and VAT). Similarly, the average rental yield of Class B offices grew by 4.6 per cent to $14.3 per sq.m per month.

Based on these optimistic results, 2019 is expected to welcome the launch of about 260,000sq.m mostly in the west of Hanoi, Ba Dinh, and Dong Da districts.

Good news for real estate investors are the increasing office-rental demand of technology firms, with a tendency to extend leasing contracts or select to lease for more than 10 years. Moreover, the US-China trade war has brought a wave of companies seeking to relocate to or set up representative offices in Vietnam. These investors are generally looking to lease at least 1,000sq.m of space for investment purposes o 500-1,300sq.m for other purposes.

CBRE identified the west of Hanoi as the “hotspot” in the office leasing market. Bui Trung Kien, director of Savills' commercial leasing department, said, "With advantages in infrastructure, specifically the forming metro line, the west of Hanoi will have better access to other central districts like Ba Dinh, Hai Ba Trung, or Hoan Kiem. It will also house the capital's largest office supply and is on track to become an economic and administrative hub."

According to the CBRE report, the average price in the segment was VND54 million ($2,350) per sq.m, up 4 per cent on-quarter and 10 per cent on-year. This is also the highest price over the past five years.

The website batdongsan.com.vn pointed out that the Hanoi saw a huge rise in real estate prices. Many projects are on sale for VND50-70 million ($2,170-3,040) per sq.m, while relatively high demand has led to a shortage in high-end apartment supply. Furthermore, the increase in foreign direct investment (FDI) in Hanoi has led to a rise in housing demand by expatriates.

According to CBRE, in the first quarter of 2019, FDI was the bright spot in Vietnam's economy. Total FDI, including newly registered capital, additional capital, and share purchase deals, has reached $10.8 billion, up 86.2 per cent on-year. Manufacturing and processing industries remain attractive for investment with a total FDI of $8.4 billion, equaling 77.7 per cent of the total FDI.

Real estate remained second with about $778 million, equivalent to about 7.2 per cent of the total FDI. According to surveys from real estate agents, as of July 2019, the 30 per cent quota for foreign buyers were quickly filled up in many high-end projects in Hanoi as soon as they opened sales.

Talking about foreign buyers’ attraction to high-end real estate projects, Nguyen Van Dinh, deputy general secretary of the Vietnam Real Estate Association, said, "The demand from foreign buyers in Vietnam increased significantly when the Housing Law was amended to allow foreigners to buy up to 30 per cent of the total number of apartments in a project. Due to the large demand, an increasing number of foreigners bought to lease and resold for returns. Most buyers will choose high-end projects developed by genuine developers that come with diverse amenities."

The west of Hanoi, especially My Dinh, attracted a large number of investors from Northeast Asia. According to CBRE's report, in the first six months of 2018, apartment leasing in the west of Hanoi (including the My Dinh area) reached the highest annual rental yield of 5.7 per cent, higher than areas like Dong Da-Ba Dinh (5.4 per cent), Tay Ho (5.5 per cent), or the southern districts (5.4 per cent).

Located on 8 Le Duc Tho (My Dinh), The Zei is a high-end mixed-used condominium with 891 beautifully appointed and intelligently configured apartments on 42 floors. The Zei provides promising rental yield rates to its buyers.

The Zei is in close proximity to international schools, and clinics, Class A office buildings, parks, lakes, and numerous shopping and entertainment destinations.

It is easy to access right by the upcoming metro line and Ring Road 3 which brings you to the airport in 30 minutes and provides direct access to numerous industrial parks.

Enterprises need to adjust talent development strategy to harness EVFTA: experts

Opportunities for Vietnamese companies from the EU-Vietnam free trade agreement (FTA) are significant, provided that employers adjust their current talent development strategy, experts noted.

Speaking at the workshop "EU–Vietnam Free Trade Agreement (EVFTA): Opportunities and Challenges for Vietnamese Workforce," experts said companies should have the right workforce to achieve their full potential and maximize opportunities.

The experts at the event also discussed the implications of Vietnam’s revised Labor Code in the context of increased international integration and the 4th Industrial Revolution.

By eliminating up to 99% of export tariffs, the EVFTA will provide Vietnamese companies with competitive prices when they export goods to European markets. This is expected to bring tens of thousands of new job opportunities per year and increase income for the Vietnamese workforce.

The greatest impact will be recorded among manufacturing industries such as textiles, footwear, furniture and seafood.

However, Vietnamese businesses are expected to face harsh competition for highly skilled labor to meet the increasingly stringent quality requirements applied to commodities and services entering the European market.

EVFTA is considered a new-generation FTA as one of its aims is to enforce labor and environmental standards.

Vietnam and the European Union have agreed on a procedure to recognize and assist with four basic labor conventions under the ILO 1998 Declaration: freedom of association and the effective recognition of the right to collective bargaining; the elimination of all forms of forced or compulsory labor; the effective abolition of child labor; and the elimination of discrimination with respect to employment and occupation.

These commitments compel the Vietnamese Government to review policies and revise the Labor Code with appropriate adjustments. It opens up opportunities as well as challenges for enterprises as they have to change to meet the commitments.

However, by complying with these commitments, Vietnam is also being given an opportunity to develop a sustainable and well-balanced labor market, which provides long-term benefits to both local workers and enterprises.

“To achieve business growth in the context of increased international integration, talent development must be the first priority of enterprises,” according to Simon Matthews, country manager of Manpower Group Vietnam who is also responsible for the group's business in Thailand and the Middle East. “To be successful, organizations must have the right talent strategy, where the development of internal employees plays an important role.”

According to “Humans Wanted, Robots Need You,” a global research study compiled by Manpower Group, up to 84% of companies worldwide will invest in training their employees in 2020.

During the workshop, Matthews also shared practical guidance for employers to develop future talent using the Build, Buy, Borrow and Bridge strategy to ensure an adequate supply of workers despite the current shortage.

Dong Nai proposes eight solar power projects

The Dong Nai government has written to the Ministry of Industry and Trade proposing adding eight solar power projects around Tri An Lake to the national power development plan until 2025, the local media reported.

These projects, with a combined capacity of an estimated 5,400 megawatt peak, will cover an area of 7,100 hectares of land in Vinh Cuu, Dinh Quan and Thong Nhat districts.

Vo Tan Nhan, director of the Tri An Hydropower Company, stated that the investment in new facilities on and around Tri An Lake will tap the area’s potential for renewable energy, reduce electricity losses and ease power shortages during peak times, mainly in the dry season.

However, the environmental impact of the projects must be assessed carefully, as Tri An Lake supplies 70% of the water used by Vietnam’s southeast region.

Vietnamese food displayed at German fair

About 30 Vietnamese businesses are introducing agricultural products at Anuga, the world’s largest trade fair for food and beverages, in Germany’s Cologne city from October 5-9.

Apart from traditional organic products like pepper, cashew nuts, rice, fruit and vegetables, they brought to the fair new ones like fermented hot chili sauce and cucumber-infused wine.

With 7,500 exhibitors and about 165,000 visitors each day, Anuga offers an opportunity for Vietnamese businesses to promote their products to food distributors and catering service suppliers across the world.

The Vietnamese booths attract thousands of visitors each day. Many companies have signed contracts worth millions of US dollars with foreign partners during the fair.

Vietnam’s participation in the fair is part of trade promotion activities organised by the Vietnam Trade Promotion Agency under the Ministry of Industry and Trade./.

Aquatic product fair kicks off in Hanoi

An aquatic product trade fair opened in Hanoi on October 8 with a view to developing the aquaculture sector in a sustainable and harmonious manner.

The event features nearly 100 pavilions set up by organisations and agencies from provincial and municipal departments of agriculture and rural development, trade promotion and industrial encouragement centres as well as companies and cooperatives engaging in aquatic processing.

It aims to boost sales of aquatic products in the domestic market and increase global competitiveness in addition to building Vietnamese seafood brand of safety, sustainable development, and high quality.

According to Dao Van Ho, director of the agriculture trade promotion centre, the total export turnover of the seafood sector in 2018 reached 8.8 billion USD, a year-on-year rise of 5.8 percent.

In the first nine months of 2019, Vietnam exported 6.23 billion USD worth of aquatic products, he added.

The trade fair will run until October 13./.

Vietnam int’l industrial fair opens in Hanoi

The 28th Vietnam International Industrial Fair (VIIF 2019) opened in the capital city of Hanoi on October 8.

Covering an area of 6,000sq.m, the fair is showcasing modern equipment and machinery including hydraulics, lifting equipment, laser engraving machines from more than 350 domestic and foreign businesses, including those from Japan, the Republic of Korea, mainland China, Hong Kong, Taiwan, Italy and Russia.

Organised by the Vietnam Exhibition Fair Centre (VEFAC), the four-day event offers opportunities for Vietnamese firms to meet with their international partners and exchange ideas.

Speaking at the opening ceremony, Deputy Minister of Culture, Sports and Tourism Ta Quang Dong described VIIF 2019 as an effective trade and investment promotion activity for domestic and international firms.

The event will also help companies update latest technology and seek new business opportunities as well as establish new partnerships, he added.

A representative from the China-based Dalian YIDE Coating Equipment Co said his company is seeking partners to work as sale representative or sales agent for powder and liquid coating lines in Vietnam.

The company is a manufacturer of customised powder and liquid coating line and also a solution supplier since 2008.

A series of business matching programmes are also continually taking place at the fair, which allows domestic and foreign enterprises to meet and establish or deepen business cooperation and push industrial development.

The previous edition lured the participation of more than 300 domestic and international enterprises and attracted about 7,000 visitors./.

HCM City aims to become regional, int’l financial centre

The Ho Chi Minh City Economic Forum 2019, scheduled to open on October 18, will seek solutions to turn the southern metropolis into a financial centre of the region and the world, heard a
press conference on October 8.

On the sidelines of the forum, there will be an exhibition displaying products of local businesses, slated for October 17, and a business matching programme between Vietnamese and foreign firms on
October 19.

Held by the municipal People’s Committee, the annual forum aims to consult domestic and foreign experts about the city’s socio-economic development, as well as its key projects, targets and programmes, said Chu Tien Dung, Chairman of the HCM City Business Association.

During the 2019 forum, municipal leaders, experts and representatives of financial and investment organisations at home and abroad will look into the situation, prospects, opportunities and challenges facing
the city in resource attraction and financial service development.

Besides, the delegates will discuss international experience in the field, the ecosystem for the sustainable development of an international financial centre, national policies and the role of municipal authorities in this regard, he said.

Dr. Vu Thanh Tu Anh, Dean of Fullbright School for Public Policy and Management, highlighted HCM City’s strategic position in the southern key economic zone, and its significant contributions to the national economy.

HCM City’s objective is not only to maintain its leading position nationwide but also to narrow the development gap between it and other cities in Southeast Asia and Asia at large.

Anh, however, pointed out that HCM City is facing direct competitions with many other major urban areas in the region, and suggested the city seek breakthrough solutions to attract the attention of financial investors, while building strategies and orientations in financial service development in order to meet demands of both investors and businesses. /.

RoK-funded sewage treatment plant inaugurated in An Giang

A sewage treatment plant funded by the Government of the Republic of Korea (RoK) through Korea Eximbank was inaugurated in Long Xuyen city in the Mekong Delta province of An
Giang on October 8.

The project has a total investment of more than 65 million USD, with 46 million USD sourced from official development assistance (ODA) loans from the RoK’s Government, and the remainder from the
Vietnamese Government’s corresponding capital.

The construction of the plant, which has a designed capacity of 30,000 cubic metres per day, began in October 2015.

Luong Van Ba, Chairman of the Board of Directors of An Giang Power and Water Supply Joint Stock Company – the investor of the project, said the plant has been put into trial operation for six months,
running at about 30 percent of the designed capacity.

Kim Jae Hwa, chief representative of Korea Eximbank in Hanoi, said through the Korea Economic Development Co-operation Fund (EDCF) under the ODA programme, the RoK has supported 66 projects worth 2.63 billion USD for Vietnam – the biggest cooperation partner of the RoK.

Particularly, the RoK has coordinated with Vietnamese localities in improving water resources and offering credit assistance for 13 water drainage projects worth up to 350 million USD, of which the sewage treatment plant in Long Xuyen city is the largest.

Vice Chairman of the provincial People’s Committee Le Van Nung said the plant will help Long Xuyen city reduce environmental pollution and diseases, create better living conditions for locals and protect
water resources in the Hau river – one of the two main tributaries of Mekong River, which flows across An Giang province./.

Australia shares experience in innovation, startups

Experience from Australia in innovation-based socio-economic development, and the difficulties in building an innovative ecosystem were shared at a workshop in Hanoi on October 8.

The event was jointly held by the Australian Embassy in Vietnam, the Ministry of Science and Technology, and the National Economics University (NEU), as part of the Australian Embassy’s Skills and Innovation Week.

Speaking at the event, NEU vice director Bui Duc Tho revealed that in order to promote entrepreneurship and innovation in Vietnam, the university has established an innovative start-up centre with effective domestic and international cooperation.

He stressed the importance of close connections between renovation and science and technology, saying that this will contribute to the success of startup ideas, and the application of these initiatives in practice.

Joanna Wood, Education Counsellor of the Australian Embassy, said her country and Vietnam have a long-term and deep cooperation in education and many other fields.

However, the two sides need to change their cooperation method, focusing on enhancing links not only between their Governments, but also among universities, research institutes and innovative centres, towards promoting development in each country, she said.

According to the counsellor, the embassy has cooperated with the Canberra Innovation Network (CBRIN) to share with Vietnam about a successful implementation model in Canberra in this field as well as exchange ideas and ways of linking research and innovation with entrepreneurship.

CEO of CBRIN Petr Adamek said the network has partnered with a range of programmes including startup promotion centres and incubator laboratories, benefiting over 1,000 entrepreneurs and small-and medium-sized-enterprises through research and education programmes.

CBRIN is working with leading universities, research institutes, companies and corporations to give advice to individuals and businesses about innovative programmes and to provide financial support for them.

At the workshop, representatives of Vietnamese businesses shared lessons from their startup journeys, helping inspire students and young people in forming and developing their own startup ideas./.