VIETNAM'S BUSINESS NEWS HEADLINES OCTOBER 15
Positive outlook ahead for economic growth in 2020
There remains plenty of room to accelerate economic growth moving into the fourth quarter of the year, with domestic consumption and investment set to be the key drivers for Vietnam’s growth during the remainder of the year, according to insiders.
This comes after the General Statistics Office (GSO) revealed that gross domestic product (GDP) during the opening nine months of the year is estimated to witness an increase of 2.12% against the same period from last year.
Although this marks the lowest growth rate in comparison to the same period over the past decade, the nation has become one of the few economies to experience positive growth due to the novel coronavirus (COVID-19) pandemic seriously impacting many socio-economic aspects of countries globally.
Furthermore, the country is anticipated to become the second nation to enjoy a rapid economic recovery in the Asia-Pacific region, according to the S&P Global Ratings (S&P).
This optimistic outlook for economic growth can be attributed to Vietnamese success in containing the epidemic, while simultaneously maintaining economic activities in localities that remained unaffected by the health situation.
Despite the COVID-19 epidemic severely disrupting international trade, export and import activities recorded a positive growth rate, with a record trade surplus of US$16.99 billion over the opening nine months of the year.
Most notably, the domestic economic sector continued to act as the driving force for Vietnamese export growth, with the sector grossing US$71.83 billion in export turnover, representing an increase of 20.2% and accounting for 35.4% of total export revenue.
Moreover, September’s trade and service activities bounced back, whilst tourism and consumption stimulus packages were also deployed in an effective manner.
Despite local businesses facing plenty of hurdles, domestic enterprises operating in the manufacturing industry remain optimistic about the production situation moving into the year’s fourth quarter.
Investment has yielded a number of positive results, with social investment capital reaching VND1,445.4 trillion, an annual increase of 4.8%, while public investment is estimated to stand at VND 327,900 billion, an increase of 31% on-year.
Whilst there are plenty of bright spots to take from the nine-month economic picture, the Vietnamese economy is still facing up to a number of challenges, largely because the COVID-19 epidemic has yet to be brought under control in several countries worldwide.
Some international organisations have therefore warned about the risks of global financial instability and challenges facing the industry and construction sectors, with COVID-19 hampering major export markets due to disruption caused to global supply chains.
Consumption endured a slow recovery in the reviewed period, with total retail sales of goods and services rising by only 0.7%, proving that people have yet to return to their previous consumption habits.
Nguyen Thi Huong, director general of the GSO, says the local economy will continue to undergo obstacles moving forward due to the increasingly complicated and unpredictable situation occurring in the global economy.
However, she also notes that the country will see positive growth momentum moving into the fourth quarter, with the year’s growth target of between 2% and 3% being feasible. Indeed, the gradual recovery of the world economy is anticipated to help increase the consumption demand for goods.
With consumption set to rise, the enforcement of the EU-Vietnam Free Trade Agreement (EVFTA) is also expected to help Vietnam restore its export activities to the EU market, traditionally a major export market for the country, Huong stressed.
Economists believe that there remains plenty of room to accelerate economic growth in the fourth quarter of the year by ensuring supply sources remain in place for essential items, therefore boosting exports and expanding into new markets, whilst also seeking new partners.
Experts therefore underscore the importance of deploying economic stimulus schemes at appropriate times to take full advantage of the domestic consumption market and remove hurdles that businesses face.
Dr. Nguyen Dinh Cung, former director of the Central Institute for Economic Research, underlined the need to mobilise resources in a bid to serve major projects and select the best investors, therefore accelerating sustainable economic growth during the remainder of the year and into next year.
Currently, the Vietnamese government is determined to implement the "dual goal" of pandemic prevention and control and socio-economic development.
In order to fulfill this goal, Huong puts forward the need to spread information about the consumption of local goods, speed up the disbursement of public investment, adjust production plans, and forecast market demand. This should be done while simultaneously regulating monetary policies, interest rates, and exchange rates in a flexible manner.
Vietnam boosts IP rights to attract investment
According to experts, one of the key factors limiting the arrival of quality investment flows in has been its poor enforcement of intellectual property rights. Intellectual property legislation is a common requirement within the framework of many free trade agreements to which Vietnam is a signatory.
Investing in Vietnam since 2007, this company quickly became one of most successful investors in the country's motorcycle manufacturing sector. It has, however, found many counterfeit models in the market.
According to foreign investors, violation of intellectual property rights in Vietnam remain a sesrious issue and occur on a large scale.This makes many potential investors hesitate when considering Vietnam as an investment destination.
This is a limitation facing Vietnam when joining major trade agreements such as the Free Trade Agreement between the European Union and Vietnam. It has effected flows of quality investment with a technological advantage.
The Government of Vietnam has set a target by 2030 of increasing the effectiveness of the intellectual property laws and significantly reducing infringement of intellectual property rights. However, experts have said, it is necessary to raise awareness about intellectual property issues in the community while strengthening the capacity and efficiency of State management agencies to promptly coordinate and solve infringement in order to attract quality foreign investment capital./ .
Stimulating consumption demand for Vietnamese products
A Vietnamese Goods’ Week, taking place in Son Tay town in the capital city of Hanoi, has attracted a large number of consumers.
The event features over 100 pavilions with thousands of goods from different commodities such as consumer goods, industrial products, handicrafts, agricultural, forestry, safety and One Community One Product goods from enterprises and localities based in both Hanoi and many other provinces and cities. Throughout the week, the enterprises have opportunities to promote their products and brands as well as to boost trade promotion and linkages in consumption, stimulating demand and bringing high-quality domestically produced items closer to people.
Hoang Van Hung, a craftsman from cutlery trade village Da Si in Ha Dong district, said: “The Vietnamese Goods’ Week is an opportunity for my production facility to link with more consumers. Da Si cutlery is popular; however, not everybody knows where to buy it. Many visitors buy products not only for their families but also for their neighbours and relatives. This event is also contributing to helping the trade village develop and preserve its tradition”.
Deputy Director in charge of the Hanoi municipal Department of Industry and Trade, Tran Thi Phuong Lan, said that under the direction of the Government, Ministry of Industry and Trade, Ministry of Agriculture and Rural Development and Hanoi city authorities regarding the implementation of COVID-19 prevention and control measures while boosting economic growth and supporting production and business, the Hanoi Department of Industry and Trade decided to hold Vietnamese Goods’ Week in Son Tay town from October 2-6. Earlier, a similar week took place at the Agricultural Trade Promotion Centre in Cau Giay District from June 19-21. The event is expected to be organised in Thach That district from October 8-12, with around 100-150 pavilions.
“The Covid-19 pandemic has heavily affected both the production levels and trade success of enterprises, especially in exports. Therefore, it is crucial to promote consumption demand activities and develop the domestic market to support enterprises in overcoming this difficult period”, said Tran Thi Phuong Lan.
The Hanoi municipal Department of Industry and Trade has also coordinated with many other units to organise a series of practical events, including a Fruit and Agricultural Products Week, a concentrated promotional programme, Vietnam export golden fair and the launch of “One Commune One Product” fairs in several districts and towns. Markets for Vietnamese products were arranged in Ba Vi, Quoc Oai, Me Linh, My Duc and Soc Son district as well as in the Bac Thang Long, Phu Nghia and Quang Minh industrial zones. A fair on high-quality souvenirs from Hanoi; a programme to connect production and consumption networks for bamboo, rattan and wooden commodities; and activities in response to the “Vietnamese people prioritising using Vietnamese goods” campaign have all attracted great attention from various enterprises and people.
As planned, the municipal Department will launch over 30 events, aiming to boost demand and supply connections as well as production and business for units and enterprises. A trade conference on supply and demand linkages between Hanoi and over 50 other provinces and cities in late November, the Dong Thap's tra fish (pangasius) and specialties week in Hanoi and a Ha Giang orange and OCOP products in December will be the highlights.
Notably, the Hanoi Department of Industry and Trade have asked districts, enterprises and markets to review and select 28 convenient places for business and provide free rental fees so that businesses can promote their products in the capital city.
These specific activities and solutions will be levers for Vietnamese enterprises to enhance their production and business capacity as well as supply and demand linkages in accordance with the value chain. They are expected to contribute to effectively implementing the dual goal of both COVID-19 prevention and control and socio-economic development as well as boosting the growth of retail and a balance between supply and demand in the capital city.
HCM City lures nearly 3.3 billion USD in FDI in nine months
Ho Chi Minh City lured 3.25 billion USD in foreign direct investment in the first nine months of 2020, down 28 percent over the same period last year, reported the city Department of Planning and Investment.
According to the department, 407 million USD was poured into 719 newly-licenced projects, while nearly 284 million USD was added into 163 underway projects, and about 2.6 billion USD was invested in 2,911 share trading deals.
Trade was the leading sector in FDI attraction with more than 751 million USD, accounting for more than 23 percent of the total. It was followed by property sector with 727 million USD, and science-technology with 686 million USD.
The department revealed that in the future, the city will prioritise three areas to call for investment: smart city, highly interactive and innovative urban area to the East HCM City, and regional and international financial centre construction./.
Vietnam’s domestic tourism is on the rise
Vietnamese travellers are riding the trend of domestic travel in the context of the ‘new normal’ situation, with many Vietnamese who only love remote destinations now turning to discover joy in neighbouring localities in their own country.
Booking.com calculated that the average distance Vietnamese travelled from June to August 2020 is down by 33% compared with the same time last year. While this figure went down, Vietnamese still travelled more in general compared to the global average, which dropped by as much as 63%.
Travel may not be the same during these unprecedented times, but data from Booking.com, one of the world’s leading digital travel companies, reveals that the happiness travel can bring is not measured in kilometres. Travel plans may have changed drastically in 2020 and Vietnamese travellers may not be able to take that distant trip they had previously hoped for, but this has given them the opportunity to discover – and in many instances rediscover – hidden gems and heaps of wonderful experiences closer to home.
While the pandemic may have put international travel plans on hold, the early easing of social distancing and travel restrictions within the country has enabled Vietnamese travellers to book domestic holidays and re-discover their home country. As Booking.com data reveals, a whopping 96% of the total distance travelled by Vietnamese between 1 June to 31 August 2020 was within the country, compared to only 52% during the same period in 2019.
Many Vietnamese travellers have rediscovered the local charm of the country with beach destinations and scenic destinations along the country’s over 3000 kms coastline seeing a relative increase in interest from travellers. The top trending domestic destinations that gained relative prominence and interest compared to same time last year include Cam Ranh, Thanh Hoa, Cua Lo, Sam Son and Quy Nhon.
While these rural gems and lesser known coastal destinations are trending, major cities and popular tourist favourites still topped the list of most popular booked destinations by Vietnamese travellers. Ho Chi Minh City, Hanoi, Vung Tau, Da Nang and Da Lat featured as the most booked destinations between June and August.
Accelerating the pace of digital transformation in the tourism sector
The COVID-19 pandemic has been seriously affecting the economy in general and the tourism industry in particular, while reflecting that traditional management and business methods are not adequate in coping with the disease, requiring immediate digital transformation to enable enterprises and management agencies to improve capacity and business efficiency to maintain operations and develop.
According to the latest forecasts, COVID-19 has caused damage of US$1 trillion to the global tourism sector and a reduction of 61% to Vietnam’s tourism revenues compared to 2019. Challenges in the context of the pandemic have increasingly required the tourism industry to implement digital transformation solutions and establishing a smart tourism data integration and sharing system, thereby creating added value for the industry’s products and services.
The application of advanced digital technologies will enable businesses to better understand customers and personalise their service and incentive packages based on customers’ preferences, while reducing costs, optimising profits and making their work processes more scientific, rapid and efficient.
This will also help enhance competitiveness of domestic tourism companies and create more positive change for both customers and tourism businesses. From customers’ perspective, through smart phones using digital applications, they will be able to perform a wide ranges of activities from planning trips and selecting means of travel and travel agents to booking hotels and the receipt of post-trip preferences, instead of directly contacting tourism companies.
Recently, Vietnam’s tourism industry has launched the online tourism mobile app “Du Lich Viet Nam An Toan” (Safe travel in Vietnam) that integrates electronic payment and the monitoring of public health in just one card. The app is aimed at more than 43 million smart phone users. This is a useful tool for travellers in recommending safe destinations and advertising destinations to tourists, as well as effectively serving the second domestic tourism stimulus programme. The app is also considered to be one of the practical digital transformation activities of state management agencies in the tourism industry. The Ministry of Culture, Sports and Tourism has requested the Vietnam National Administration of Tourism to take immediate measures, such as accelerating the application of digital technology for tourism marketing, smartly managing tourist destinations, building big data and information systems for common use, and spreading digital technology to all levels and branches to support Vietnamese tourism development.
The digital transformation process in Vietnam’s economy is still moving, but whether the pace is fast or slow depends on the capability, the sense of responsibility and the efforts of enterprises, organisations and local authorities, in addition to the drastic engagement from levels and branches. Tourism is an integrated economic industry with deep cultural content and close relationships with many other industries such as security, transportation, health and trade, therefore its digital transformation requires the synchronous, close and long-term coordination of many components based on a strong and unified technology foundation. Digital transformation is not only about technology but also the management, approach and promotion methods. This requires innovation in both thinking and action of the entire sector, from management agencies to businesses.
Vietnam currently has nearly 44 million smart phone users, more than 67 million internet users, approximately 66 million social media users, and 145 million mobile subscribers. These provide a premise for promoting digital transformation in all industries, especially the tourism sector. In June 2020, the Prime Minister approved a national digital transformation programme until 2025, with a vision to 2030. Accordingly, Vietnam aims to become one of the 50 leading countries in terms of information technology, with the digital economy to account for 20% of GDP by 2025. This is also an important corridor and support for economic sectors as a whole and the tourism industry in particular to accelerate their digital transformation pace. And the COVID-19 pandemic, with its negative impacts, will become a powerful boost to make the digital transformation process in the tourism industry faster and more profound if opportunities from this reality are effectively utilised.
Da Nang develops high-tech agriculture
The central coastal city of Da Nang has determined it will promote high-tech agriculture as one of five spheres of socio-economic development, and has issued a number of attractive mechanisms and policies to attract greater investment. Not only creating clean, high-quality products for the market, many high-tech agricultural models have also brought handsome returns to investors.
Every day, this unit provides hundreds of kilos of vegetables of all types to customers in Da Nang through supermarkets and safe vegetable shops.
Established in 2017 with initial investment of some 150,000 USD, it still can’t supply sufficient product volumes for the market.
With preferential policies on matters such as site clearance and production facility investment, among others, Da Nang has developed nearly 20 agricultural models using high-technology in various fields since 2017, helping to generate stable returns for investors.
The development of high-tech agriculture in Da Nang has achieved initial results over recent years, but difficulties remain that hinder the sector’s growth and dampen interest among investors. To resolve any and all obstacles, the city will continue to introduce mechanisms and policies to attract more investors in the future.
As one of five socio-economic development spearheads, under Resolution No 43, the development of high-tech agriculture is an exorable trend in Da Nang ensuring local food supply and improving the lives of people living in rural areas./.
Vietnam sets 4-5% annual growth for livestock production for next five years
Prime Minister Nguyen Xuan Phuc has approved a strategy for Vietnam’s animal husbandry sector over the next ten years, aiming to achieve annual growth of 4-5% for the 2021-2015 period and 3-4% for the 2026-2030 period.
The overall goal is modernising livestock production, enhancing its competitiveness and sustainability.
Under the strategy Vietnam’s meat products will meet safety standards, farm animals will be handled in a more humane way and livestock production will be more environmentally friendly.
The amount of meat produced over the next five years is expected to reach 5-5.5 million tonnes, with pork accounting for 63-65%, poultry 26-28% and cattle 8-10%.
During the same period, the country has set a target of producing 18-19 billion eggs and 1.7-1.8 million tonnes of milk.
Vietnam also aims to export 15-20% of its pork output and 20-25% of its poultry and egg output.
By 2025 Vietnam is expected to have 60% of cattle and 40% of poultry slaughtered at industrial facilities, with the ratios increasing to 70% and 50% respectively by 2030.
With a view to 2045, Vietnam’s livestock production will be among the top in Southeast Asia, with most of its main products coming from biologically safe and environmentally friendly facilities.
In order to realise such targets, the government will introduce appropriate incentive measures, enhance disease and environmental protection capacity, and promote science, technology and international cooperation, amongst others.
Vietnam- US trade turnover surges 170 times in 25-year period
Vietnam has become the 27th largest export market and 16th largest trading partner of the United States, while two-way trade turnover has increased by nearly 170 times from a figure of US$450 million in 1994, to approximately US$76 billion in 2019.
Information regarding mutual trade was released during the US-Vietnam Business Summit 2020 titled “Trusted Partners Prospering Together” held on October 9 in Hanoi by President of Vietnam Chamber of Commerce and Industry (VCCI) Vu Tien Loc.
Recent shifts in global supply chains has served to boost the nation’s standing from 12th to ninth among the largest exporting countries to the US market. Indeed, the economies of both countries are increasingly supplementary, the VCCI leader emphasized.
The past few years has seen the nation export key products to the US market, including seafood, cashew nuts, garments and textiles, along with leather and footwear, while the US is viewed as a plentiful supply source to meet Vietnamese import demand. Notable import items include machinery, high-tech equipment, aviation equipment, telecommunications, energy, liquefied gas, and raw agricultural materials.
At present, 130 countries and territories invest in the country, with the US being the second largest investor in 2019 with a total value of US$93.4 million, accounting for 18.4% of outward investment capital. During the first quarter of the year, the US represented the leading country with US$20.1 million, making up 40.8% of the overall figure.
Loc affirmed that investment and business projects launched by US firms in the country have played an increasingly important role in Vietnamese development, therefore helping the nation to become a more active participant in the global supply chain.
According to Deputy Minister of Planning and Investment Tran Duy Dong, US businesses have been present in the nation since the two countries normalized diplomatic ties, with typical projects being successfully ran by the likes of Cargill, Coca-Cola, Caterpillar, and Intel.
"These are important bricks to link the investment relationship between Vietnam and the United States, thereby paving the way for promoting economic co-operation between the two countries towards boosting production and building a brand on a sustainable basis in the global value chain," Deputy Minister Dong noted.
With regard to investment in the nation, the US ranks 11th out of 138 countries and territories, with a total registered investment capital of approximately US$9.4 billion pouring into over 1,000 valid investment projects. The majority of these focus on hotel services and catering, accounting for 46% of total investment capital, and the processing and manufacturing industry, making up 31% of total investment capital.
Most notably, US investment in the country can be calculated at a much larger figure, possibly up to US$15 billion of investment capital. This is due to major firms such as Intel, Coca Cola, Procter & Gamble, Chevron, and ConocoPhillips entering the Vietnamese market through its branches and subsidiaries registered in a third country, such as British Virgin Islands, Singapore, and Hong Kong (China).
In addition, a number of large technology corporations like Apple, Google, and Dell, are all invested in the nation through the Original Design Manufacturing (ODM) and Original Equipment Manufacturing (OEM) businesses of their supply chain.
With regard to overseas Vietnamese investment, the US is currently in the top 10 out of 81 countries and territories in terms of investment destinations.
The nation has close to 200 valid investment projects ongoing in the US, with total registered investment capital of roughly US$750 million.
These typical investment projects are largely run by Viettel Military Industry and Telecoms, Vingroup Investment Vietnam JSC, Vietnam Dairy Products Joint Stock Company (Vinamilk), FPT Software Company Limited, An Phat Xanh Plastic JSC, Joint Stock Commercial Bank for Foreign Trade of Vietnam (VCB), and Global Mobifone Technology JSC.
September auto sales up 32 percent
Sales of automobiles in September increased 32 percent against the previous month to reach 27,252 units, the Vietnam Automobile Manufacturers’ Association (VAMA) reported on October 10.
Sales of passenger cars expanded 34 percent to 20,630 units and commercial vehicles, up 29 percent to 6,396 units. Meanwhile, special-use vehicles dropped 16 percent month-on-month to 226 units.
September sales included 17,826 locally-assembled vehicles, up 28 percent, and 9,426 imported vehicles, up 41 percent.
During the first nine months, a total of 179,155 vehicles were sold, a drop of 22 percent year-on-year, with passenger cars falling 23 percent, commercial vehicles, down 20 percent, and special-use vehicles, down 36 percent.
Insiders said the figures have failed to reflect the whole market situation as they excluded sales of many brands that are not VAMA members like Audi, Jaguar Land Rover, Mercedes-Benz, Subaru, Volkswagen, Volvo and TC Motor.
TC Motor unveiled on October 10 that it sold 8,213 automobiles last month, a rise of 53 percent from August, while VinFast sold a record of 3,684 units.
The combined sales of VAMA members, TC Motor, and VinFast reached 39,147 in September.
TC Motor, Toyota, KIA, VinFast, Mazda, Ford, Mitsubishi and Honda are the best selling in the Vietnamese automobile market.
Experts explained that the domestic automobile market has bounced back as the COVID-19 pandemic has been contained in Vietnam and businesses have offered an array of promotion programmes.
However, they said, it is hard to raise this year’s sales to 400,000 units as recorded last year since the average monthly sales stood at only 20,000 units per month during the January-September period, as compared with 33,000 units last year./.
Cafés recovering post-COVID-19
Vietnam has so far controlled its second wave of COVID-19 quite well, helping social activities return to something approaching normal. Cafés and other venues selling beverages like coffee and soft drinks have been reopened and are as vibrant as they were prior to the pandemic.
At a coffee shop during the COVID-19 pandemic, which was a common sight around the country.
Here are photos of outlets along Trung Kinh and Trung Hoa streets in recent days, with COVID-19 having been brought under control and no cases of community transmission found for nearly a month.
In some parts of Hanoi, the number of customers at restaurants, shops, and especially coffee shops has risen significantly. Many people say they feel quite safe and have no concerns about the pandemic. They also feel a need to go out and meet friends after a long period of social distancing.
Some businesses have continued to impose a minimum distance between tables and chairs and at the same time maintained prevention measures.
Some people are still concerned about gathering in public places, but most believe that measures to cope with the pandemic are sufficient./.
Foreign capital poured into education in Vietnam
With a surge in capital contribution and share purchase, foreign capital investment in education in Vietnam rose by nearly 58 percent to 78.89 million USD in the first nine months of this year despite the COVID-19 pandemic, reported the Ministry of Planning and Investment’s Foreign Investment Agency.
Among 15 countries and territories investing in education in Vietnam, the British Virgin Islands took the lead with 23.68 million USD in value, or 30 percent of the total, followed by the Republic of Korea, the US and Singapore.
According to the Vietnam Investment Review, the Diamond Crest Global Limited from the British Virgin Islands poured 17.6 million USD into an international education company based in Hanoi in May.
The Singapore-based MS English 2 Pte. Ltd, which is wholly owned by Myanmar Strategic Holdings Co. Ltd. also purchased Wall Street English Co. Ltd. in Ho Chi Minh City in July after two months of negotiations.
Notably, the Wall Street English still incurred a loss of 1.4 million USD while its unaudited revenue in the past 12 months reached nearly 13.8 million USD and total asset hit 3.4 million USD as of April 30.
Commenting on the Wall Street English Vietnam, CEO of the Myanmar Strategic Holdings Enrico Cesenni said the Vietnamese company has over 6,000 clients in seven centres in Ho Chi Minh City and Binh Duong.
Such centres will continue working under a 10-year franchise deal with the Wall Street English International, similar to the deal applied for Wall Street English Myanmar./.
Work starts on Mekong Delta’s biggest mainland wind project
Hacom Bac Lieu Energy JSC on October 11 started construction on the first phase of Hoa Binh 5 wind power farm on an area of 28 hectares in Vinh Thinh commune, Hoa Binh district, the Mekong Delta province of Bac Lieu.
The first phase of the project, which has a total investment of 3.2 trillion VND (138 million USD), is designed to have 26 wind turbines with a capacity of 3.0 – 4.2 MW each.
It will be the biggest mainland wind farm in the Mekong Delta.
The plant will be connected with the national power grid on the 220kV Gia Rai – Bac Lieu 2 transmission line, General Director of Hacom Bac Lieu Energy Tran Phu Chien said.
The project will be integrated with aquaculture production to improve land use effectiveness and is expected to contribute more than 80 billion VND to the State budget per year, he added.
Chien further noted that scheduled to complete in October 2021, the project will generate over 280 million kWh of electricity annually.
Chairman of the provincial People’s Committee Duong Thanh Trung said since 2010, Bac Lieu has been home to 10 wind power projects, including one completed and nine under construction, with total capacity of more than 660 MW and combined investment of over 1 billion USD.
Trung urged local departments and agencies to help the Hacom Bac Lieu JSC with legal procedures and timely solve any problems, particularly in land clearance as Hoa Binh 5 and other wind power projects form one of the province’s five development pillars./.
Hai Duong’s lychee, longan export successful beyond expectation
The lychee and longan crops 2020 in the northern province of Hai Duong have been successful beyond expectation, said Director of the provincial Department of Agriculture and Rural Development Tran Van Quan.
During a recent conference reviewing the expansion of lychee and longan farming cultivation areas up to international standards and farm produce trade promotion, Quan said the volume of local longan and lychee export this year had hit record.
Apart from increasing exports to the US, Australia, the European Union and the Middle East, Hai Duong also succeeded in navigating new demanding markets such as Singapore and Japan.
Total revenues from this year’s lychee season amounted to 1.16 trillion VND, up 445 billion VND from the previous crops. The province shipped abroad nearly 1,500 tonnes of lychee out of the total harvest of 43,000 tonnes this year.
As for longan, the value of this year’s harvest was estimated at 120 billion VND.
Hai Duong is now home to 9,750ha of lychees and 2,100ha of longan fruits. It built 23 lychee and longan cultivation zones meeting VietGAP standards, he said.
According to Vice Chairman of the provincial People’s Committee Luu Van Ban, local agriculture growth was estimated at about 7.4-7.5 percent this year despite the COVID-19 pandemic, much higher than many years ago.
He also vowed to offer incentives to investors and firms operating in agriculture, especially farm produce processing.
Director of the provincial Department of Agriculture and Rural Development Tran Van Quan affirmed that the local agriculture sector will continue working closely with localities to expand cultivation zones up to international standards.
Next year, the sector plans to extend international-standard farming zones for lychee, longan, guava and vegetables while building sustainable connectivity chains to improve their value./.
Construction of wind power plant’s second phase begins in Bac Lieu
Work on construction of the Dong Hai 1 wind power plant, second phase, began in Long Dien Dong commune, Dong Hai district of the Mekong Delta province of Bac Lieu on October 10.
On the occasion, the operation centre of the Dong Hai 1 wind power plant, which will be used for both phases, was inaugurated.
The two phases have a total designed capacity of 100 MW and total investment of more than 5.5 trillion VND (237.83 million USD).
The plant will cover an area of more than 2,700 hectares of water surface and more than 11 hectares on land.
It will have 26 wind turbines, a transformation station 22/110kV-1x63MVA, a 110kV line, an operations centre and other supporting works.
The Dong Hai 1 wind power plant project is expected to add 75 MW to the national grid by the end of next April.
Once operational, the plant will contribute about 367 million kWh to the national grid.
Speaking at the ceremony, Chairman of the Bac Lieu People’s Committee Duong Thanh Trung said since the launch of the first wind power plant in the province ten years ago, the province to date has housed 62 wind turbines with a combined capacity of 99.2 MW, generating nearly 1.1 billion kWh of electricity.
Trung added that more than 660 MW will be generated by the end of 2021, affirming that the development of coastal wind power projects is in line with Bac Lieu’s strengths and potential.
He committed to creating favourable conditions for the investor so that the project will be put into operation soon./.
ASEAN, Argentina step up trade cooperation
A webinar on trade between ASEAN and Argentina was held on October 11, aiming to accelerate the implementation of trade agreements inked between the two sides.
In her remarks, Julia Perie, an Argentine parliamentarian at the Mercosur Parliament (Parlasur), touched on priorities in selling Argentinean products in ASEAN, and challenges to diversify exports.
She underlined that agricultural products account for nearly 90 percent of Argentinean exports to ASEAN, so the Latin American nation prioritises creating added value for those items, along with expanding cooperation in other spheres such as leather industry, pharmaceutical products and plastics.
Sebastián Molas, Undersecretary of Institutional and Government Relations of the Cabinet of Ministers, said Argentina will seek to enhance trade with international partners in the post-COVID-19 period, and ASEAN is viewed among key and prioritised regions of the Argentinean government.
At the same time, the country also pays heed to imports of telecom devices from Southeast Asia for the development of its technology and new media platforms.
At the event, a representative of the Vietnamese Embassy highlighted achievements of ASEAN since its formation, including sustainable economic growth indexes and its relations with international partners./.
Cashew nut exports to thrive in year-end months: insiders
Vietnam’s cashew exports are likely to increase in the remaining months of the year, prompted by surging demand, cashew firms have said.
Figures released the Agency of Foreign Trade under the Ministry of Industry and Trade showed that Vietnam shipped 363,000 tonnes of cashew nuts abroad in the first nine months of 2020, raking in 2.3 billion USD, up 10.6 percent in volume but down 4 percent in value compared to the same period last year.
China’s demand for cashew nuts is on the rise, but importers have imposed stricter requirements on quality and Vietnam’s inventories may be insufficient.
The Vietnam Cashew Association (VINACAS) forecast that exports of cashew kernel in the remaining months will surge thanks to growing demand of major importers including the US, the EU, India and China, during their holidays.
Global cashew kernel prices are expected to increase in the coming time, given that various small- and medium-sized processing facilities in Vietnam and India reduced their capacity, resulting in a decline in supply.
The cashew industry targets exports of 450,000 tonnes this year for 3.2 billion USD, according to VINACAS./.
VIB's pre-tax profit surges 52% in Q3
Vietnam International Bank (VIB) posted pre-tax profit of over VNĐ1.66 trillion (US$72 million) in the third quarter of 2020, up 30 per cent month-on-month and 52 per cent year-on-year, according to its third quarter 2020 financial report published on Monday.
In the first nine months of this year, VIB's total revenue surpassed VNĐ7.85 trillion, up 34 per cent year-on-year. Of which, its fee income reached more than VNĐ1.63 trillion, accounting for 21 per cent of total revenue.
During the period, the bank's pre-tax profit saw a yearly increase of 38 per cent to over VNĐ4 trillion. Its return on equity ratio (ROE) was 28.9 per cent, among the highest in the banking industry.
As of September 30, 2020, the bank's total assets reached over VNĐ213 trillion while its credit over VNĐ151 trillion, up 14.2 per cent year-over-year, triple the industry average, according to the data.
From January to September, the bank has continued to invest in technology, branch networks and people, recruiting more than 1,500 employees.
On October 5, VIB's shareholders approved to cancel its trading on UPCOM. That will allow the bank to list nearly one billion shares to Hồ Chí Minh Stock Exchange next month.
Previously, the bank also got the approval of the State Bank of Việt Nam to divide bonus shares at the rate of 20 per cent for existing shareholders to increase its charter capital to over VNĐ11 trillion.
For many years, VIB has always maintained its position as one of the leading banks in the trend of digital banking services with special emphasis on mobile phone platforms. VIB is the only bank in Việt Nam that has won a customer experience award for four consecutive years and Digital Bank of the Year award for three consecutive years by The Asset magazine.
The bank has launched a new version of MyVIB application and officially applied e-KYC into issuing e-banking accounts for VIB customers, that allows registration and transactions on the phone after just a minute.
Medical face mask exports enjoy sharp recovery
Vietnam shipped 989 million medical face masks of various types abroad during the opening nine months of the year, according to statistics compiled by the General Department of Vietnam Customs.
Most notably, September alone witnessed over 70 major local firms ship medical face masks oversea, with total export volume of the items reaching approximately 143 million units, representing a slight increase of 5.5% compared to August.
After the export of the items suffered a decline from their peak of 236 million in June to 154 million and 135 million in July and August, respectively, exports to several major countries have started to enjoy a recovery.
Indeed, exports to markets that have begun to bring the novel coronavirus (COVID-19) epidemic under control look to be picking up once again.
Several domestic enterprises have therefore accelerated their export of face masks since the enforcement of Government resolution No. 60 that permits firms to export an unlimited quantity of face masks.
Furthermore, other companies have shifted their investments to focus on machinery and equipment, or to increase their export of face masks, serving to create a "fever" to produce the product.
Moreover, a number of businesses believe that the market has become gradually saturated, with demand for the product now lower than previously due to supply sources significantly rising.
Ample opportunities for EU and Vietnamese agri-food producers following EVFTA
The EU-Vietnam Free Trade Agreement (EVFTA) has opened up a wealth of opportunities for companies on both sides looking to profit from an already thriving trading partnership, particularly in the agri-food sector.
This was stressed at a digital seminar on EU production standards for agri-food products held by the European Commission on October 8-9. The event was hosted by Giorgio Aliberti, EU Ambassador to Vietnam, with the participation of European experts in food safety and quality policy, as well as representatives from the Vietnamese authorities, EU food sector organisations, local importers, and retailers.
Vietnam is the EU's second-largest trade partner within ASEAN, after Singapore. Trade in goods totalled €45.5 billion ($53.83 billion) last year. The bloc’s main exports to Vietnam include electrical machinery and equipment, aircraft, vehicles, and pharmaceutical products. Meanwhile, Vietnam's main exports to the EU are electronic products, footwear, textiles, as well as coffee, rice, seafood, and furniture.
Under the EVFTA, 71 per cent of duties on imports from Vietnam were eliminated instantly with a further doing away of 99 per cent of all duties on goods within seven years. The agreement also ensures a level playing field. Vietnam has signed up to international standards, rules on animal and plant health and recognition of the "Made in EU" origin marking for most non-agricultural products.
With the official entry into force of the EVFTA, food (particularly the agri-food sector) could make big gains by exploring new growth markets. In 2019, the EU exported €1.1 billion ($1.3 billion) of agricultural food into Vietnam, with imports totalling €2.2 billion ($2.6 billion). It makes Vietnam the 29th destination for EU agri-food producers worldwide. Top agri-food exports into Vietnam include fresh and frozen meat, milk powders and whey, infant food, cereals, and flour.
Meanwhile, tea and coffee are the EU’s biggest import items from Vietnam, accounting for 47 per cent. Nuts, spices, and fruit make up 34 per cent. Many Vietnamese products currently benefit from trade preferences under the General Scheme of Preferences (GSP). It allows for some key products such as rice, mushrooms, or sugar to be imported into the EU with reduced or zero duties.
Food stafety plays an important role in boosting the exports of agri-food sector from Vietnam to the EU. According to the European Commission, the food and beverage industry is the EU's biggest manufacturing sector and in the last decade, exports have doubled to over €90 billion ($106.47 billion). EU quality standards for agricultural food and beverage products are world renowned – not just for their reputation but for adding value to the livelihood of farmers and rural communities. And right at the heart of the reputation is the European Commission's Food Safety policy which gives a high level of protection from farm to fork.
The four pillars of EU food safety cover:
Food hygiene: from businesses to farms and restaurants. All must comply with EU food law, including those importing food into the EU.
Animal health: ensuring sanitary controls and measures for pets, farmed animals, and wildlife. As well as monitoring and managing diseases by tracing the movement of all farm animals.
Plant health: includes the detection and eradication of pests.
Contaminants and residues: keeping contaminants away from food and animal feed.
EU protections work equally on goods entering the bloc. A key legislation to this aim is the Sanitary and Phyto-Sanitary (SPS) system for animal and plant agri-food products. Its role is to reduce or eliminate risks of animal, plant, and public health threats as well as animal and plant diseases being introduced into the EU by goods coming from non-EU countries. Controls also exist on certain imports of feed and food of non-animal origin.
Another key area is geographical indicators. The representative of the European Commission stated that, "Our citizens are at the heart of what we do. Protection of local food traditions and heritage must be respected by our partners. But we also aim to reciprocate what matters to you."
169 traditional European food and drinks products from a specific geographical origin will be protected against imitation on the Vietnamese market. This includes famous European delicacies such as Champagne, Parmigiano, Reggiano cheese, Rioja wine, and Feta cheese. Meanwhile, well-known Vietnamese products such as Mộc Châu tea or Buôn Ma Thuột coffee are given EU protection.
The digital seminar has attracted several EU and Vietnamese food producers. It was also a platform to discuss opportunities under the agreement on trade of agri-food products, an opportunity for many Vietnamese stakeholders to learn about and benefit from the EVFTA.
Day one of the event centred on the EVFTA and breakdown EU food safety standards. A big focus was on the EU Sanitary and Phyto-Sanitary (SPS) system for animal and plant agri-food products. It ensures that EU products are safe, traceable, and of high quality, a feature that is now passed onto Vietnamese consumers through the trade deal. Meanwhile, day two identified the key areas in food and beverage that could benefit from the EVFTA.
Steps to advance US-Vietnam trade and investment
The US-Vietnam Business Summit, titled Trusted Partners Prospering Together brought together government and industry leaders from both countries to discuss ways to promote expanded trade and investment and new opportunities to help fuel Vietnam's post-COVID-19 economic recovery.
The American Chamber of Commerce in Hanoi (AmCham) and the US Chamber of Commerce, in co-operation with the Vietnam Chamber of Commerce and Industry (VCCI), hosted a major conference on the future of Vietnam-US commercial relations yesterday (October 9) in Hanoi.
The business summit, meant to build on the current positive momentum in the bilateral economic relationship, also celebrated 25 years of diplomatic relations between Vietnam and the United States. The event featured in-person and virtual participation by many current and former officials from the two countries, highlighted by remarks from former US Secretaries of State John Kerry and Madeleine Albright who both talked about the importance of the commercial relations in helping the two countries strengthen their friendship and partnership.
Deputy Minister of Planning and Investment Tran Duy Dong highly appreciated the diplomatic relationship between Vietnam and the US, highlighting successful businesses and projects in Vietnam like Cargill, Coca-Cola, Pepsico, and Intel. "They are the key bricks that build the trade and investment co-operation of the two countries, and develop it sustainably," said he.
The US ranks 11th out of 138 countries and territories investing into Vietnam with more than 1,000 valid projects, and over $9.4 billion, concentrating on hotels, services, processing, and manufacturing. "In fact, US investment into the country is much bigger because a lot of projects have been implemented through third countries and some technology giants have invested into Vietnam through their partners," said Dong.
On the other hand, the US is among the top 10 countries and territories where Vietnam is investing, including 200 projects worth $750 million from the likes of Viettel, Vingroup, FPT, Vinamilk, An Phat Plastic, and Vietcombank.
The Ministry of Planning and Investment (MPI) has closely collaborated with embassies, the AmCham, US-ABC, banks, and consultant companies to promote bilateral relations with the US. "The MPI was also instrumental in the handshake with the US International Development Finance Corporation to strengthen infrastructure development," added Deputy Minister Dong, and highlighted some areas that are the strengths of the US and where Vietnam ha strong demand like renewable energy, transport, banking and finance, education and training, tourism, high technology, and high-tech agriculture.
Through dynamic growth from the very beginning, bilateral trade turnover reached $76 billion, a 170-fold growth compared to 1994. "The restructuring of global supply chains has enabled Vietnam to rank ninth (from 12th) among exporters to the US. The economies of Vietnam and the US complement each other," Vu Tien Loc, chairman of VCCI said.
While Vietnam exports seafood, cashew, textile, and footwear to the US, the US is an abundant supplier of machines, high-tech equipment, as well as equipment in aviation, telecommunications, energy, liquefied gas, and agricultural materials. Vietnam is currently the 27th largest export market and 16th trade partner of the US.
"Despite Vietnam's unsustainably large trade surplus with the United States, I am confident that the growth trend of trade and investment between our two countries will continue and can strengthen," said AmCham executive director Adam Sitkoff. "Progress on the key issues raised at today's summit will improve business conditions that strengthen the private sector, ensure economic and social development, attract additional investment, and promote prosperity here in Vietnam."
Speakers and panel participants discussed a wide range of issues, including promoting sustainable and predictable investment policies; driving growth and innovation through the digital economy; addressing Vietnam's energy development needs; navigating Asia's supply chain and manufacturing landscape in a post-COVID-19 world; working together to help Vietnamese businesses and entrepreneurs reach their potential, and global trade dynamics and the upcoming US election.
Idea of cricket powder wins $15,000 at VietChallenge
CricketOne, a start-up supplying food ingredients extracted from crickets, won a prize at VietChallenge, a global competition for Vietnamese innovators, on Sunday.
CricketOne is one of the global leaders in supplying a sustainable and affordable protein that replaces conventional animal and grain protein. It has won at many competitions for start-ups such as Blue Venture Award 2019 in Việt Nam and The Venture 2020 in Canada.
Receiving US$15,000 in cash, Bicky Nguyen, co-founder of CricketOne, said she and the whole company were very happy and touched when discovery they had won.
“With all the efforts of the entire company, VietChallenge 2020 Champion is one of the most deserving achievements that we and CricketOne have received,” she said.
This year was the fifth edition of VietChallenge, featuring 200 teams around the world. Organisers selected the six best start-ups with diverse business models, in different fields such as education, medical services, engineering technology, robotics, attending the online final round.
CEO of VietChallenge Steven Tai Nguyen said the equity crowdfunding in the US is becoming more accessible to international start-ups, specifically Vietnamese.
Ambassador of Việt Nam to the US Hà Kim Ngọc emphasised the role of VietChallenge as an important network between young people and domestic and foreign entrepreneurs in technology development and application.
He said: “This is a platform for incubating and developing start-up ideas in technology, as well as being a place for networking and exchanging opportunities for cooperation, fostering entrepreneurship among young Vietnamese, thereby connecting Vietnamese people nationally and internationally, including everyone who is living, studying, and working in the US.”
In addition to the special sections of the VietChallenge Finals, discussions were held by famous speakers and guests from the start-up ecosystem.
Seminar highlights development of value chain for agricultural exports
A seminar discussing ways to develop the value chain for agricultural products was held in northern Ninh Binh province on October 14 by the the Vietnam Co-operative Alliance in collaboration with Germany's Friedrich Naumann Foundation for Freedom (FNF).
The event aimed to share experience in developing a co-operative model in association with value chains, promote efforts to boost the export of agricultural products to the global market, and identify opportunities and challenges faced by the co-operative sector when participating in the value chains.
Nguyen Van Thinh, Vice Chairman of the Vietnam Co-operative Alliance, expressed hope that the occasion will provide an ideal forum in which co-operatives can come together and share difficulties when joining the value chain, in addition to making useful recommendations for the co-operative area.
Adreas Stoffers, Country Director of FNF in Vietnam, expressed his delight at the success of Vietnamese co-operatives in recent years, adding that they will make a significant contribution to helping local farm produce meet export requirements when joining the international value chain.
At the seminar, participants discussed how to boost production towards value chains, opportunities for Vietnam’s farm produce export and the application of digital platforms in developing the value chain for farm produce, and proposed solutions to promote building and developing value chains for co-operatives.
By June this year, there had been a total of 25,282 co-operatives nationwide, with agricultural co-operatives accounting for 64 percent of the figure.