VIETNAM'S BUSINESS NEWS HEADLINES OCTOBER 27
Industry - trade sector to ensure enough goods for traditional lunar new year
|The industry and trade sector will ensure enough essential consumer goods to meet shopping needs and promote market surveillance to prevent goods smuggling ahead of the Tet holidays. (Photo baodansinh.vn)|
The industry and trade sector will ensure enough essential consumer goods to meet shopping needs and promote market surveillance to prevent goods smuggling ahead of the traditional lunar new year holiday, the Tet, an official has said.
Hoang Anh Tuan, deputy director of the Domestic Market Department under the Ministry of Industry and Trade (MoIT), said to avoid a shortage of essential goods, the MoIT plans to balance the supply and demand for consumer goods until this year-end and even to the yearly longest festival which will come in early 2021.
The ministry plans to work with the industry and trade departments in all localities nationwide, associations, industries, and manufacturing and retail enterprises to follow supply, demand and prices of essential goods so it can promptly offer solutions to avoid goods shortages.
The ministry has asked departments and businesses to build market stabilisation programmes, especially in the period approaching Tet festival, and increase goods selling places in industrial zones and remote areas, Tuan said.
Deputy director of the Hanoi Department of Industry and Trade Tran Thi Phuong Lan said her department will closely monitor the Hanoi market to work out solutions on ensuring goods supply for the consumption before, during and after the festival.
Hanoi authorities will also organise many events to stimulate demand on consumer goods, including a fair under the campaign for Vietnamese people using Vietnamese goods, 30 mobile sales trips, 12 Vietnamese goods fairs and other fairs for regional speciality goods, Lan said.
The capital will also work with other localities to diversify kinds and sources of consumer goods for the city's market, such as goods from Ha Giang, Son La, and Hoa Binh provinces.
A representative of the HCM City Department of Industry and Trade said until this end of the year, it will promote connections between banks and businesses to help firms to take soft loans to store essential goods due to higher demand around the festival.
In addition, it will organise trade promotion fairs to help businesses sign contracts to buy essential goods for reserves.
Meanwhile, director-general of the General Department for Market Surveillance Tran Huu Linh said until the festival, the market management force will continue to implement anti-smuggling programmes.
It will focus on managing consumer products often in higher demand during the festival, such as cigarettes, cigars, alcohol, soft drinks, clothes, shoes and cosmetics products.
It will also continue to work with agencies, associations and localities to inspect potential counterfeit goods, goods with unknown origin, and prices that are listed at markets, supermarkets and convenience stores, Linh said.
In the past nine months, the General Department for Market Surveillance handled nearly 65,000 cases of smuggling, counterfeiting and fraudulent goods, including 6,737 cases in September./.
HCM City seeking ways to attract more FDI
HCM City is enacting numerous solutions to facilitate FDI into the city by focusing on infrastructure and administrative procedures, as the fund poured into it has been dwindling this year.
The country’s biggest economic hub received 3.25 billion USD worth of FDI in the first nine months of the year, a 28 percent decrease year-on-year, according to the city's Statistics Office.
There were 719 new projects worth 407.4 million USD, 23.6 percent and 57.1 percent down.
Nguyen Anh Thi, head of management of District 9’s Saigon Hi-tech Park, said the park has been discussing with 15 potential foreign investors since the beginning of this year, but only issued a permit for one project worth 3 million USD.
The number of projects with investment of above 100 million USD is reducing while investors are increasingly moving away from HCM City and to other provinces.
Many investors have complained that traffic infrastructure and administrative procedures have not improved much.
In face of the situation, the city is speeding up work on infrastructure projects such as the metro line No 1 and Thu Thiem Bridge No 2.
It is also focusing on streamlining procedures involved in licensing permit, as well as further utilising information technology to reduce time spent on the procedures, and expanding online public services.
The city is also pushing up the construction of more industrial parks. It has recently proposed setting up of a new 280 hectares hi-tech industrial park in Binh Chanh District.
Meanwhile, industrial production is showing signs of recovery in HCM City post-COVID, benefiting from support policies.
Its Index of Industrial Production was 9.6 percent up in September, and 2.2 percent higher year-on-year, according to the Department of Industry and Trade.
The policies include deferment of tax and land rent payment, loans on easy terms from banks and consultancy.
Several industries have seen production rise since last month, food processing by 10.2 percent, chemicals by 33.4 percent, and rubber and plastic by 2.8 percent./.
Workshop discusses challenges faced by energy service companies market
There is great potential for the energy service companies market in Viet Nam, a workshop heard in HCM City on Thursday.
Power consumption is forecast to increase sharply in the coming years, spurred by rapid socio-economic development, while supply is inadequate.
Markus Bissel, head of the component energy efficiency, renewable energy and energy efficiency project, EU-Viet Nam Energy Facility, GIZ Vietnam, said: “With still one of the highest energy intensities in Southeast Asia the Vietnamese Government faces many challenges to improve energy efficiency, particularly in the commercial and industrial sectors.
“Even though the Vietnamese Government successfully implemented the Vietnam Energy Efficiency Programme 1 and 2 and is currently implementing No.3 with very ambitious objectives, it is foreseeable that it is getting more and more challenging to meet the increasing energy demand.”
According to Nguyen Dinh Hiep of the Viet Nam Association of Science and Technology for Economical and Efficient Use of Energy, in this context, the economical and efficient use of energy has become compulsory.
“Energy service companies (ESCO) are one way to promote economical and efficient energy use,” he said.
Bissel said ESCO provide services related to energy efficiency and financing of energy efficiency measures.
“The ESCO model world-wide is a driver of investments in energy efficiency measures. And even in Viet Nam, in some specific sectors, the ESCO model is successfully applied.”
Hiep said ESCO would provide a comprehensive energy services package including energy efficiency consulting, planning, construction, installation, operation, maintenance, optimisation, and financial contribution, and apprise customers about investment costs, energy saving results and investment risks.
“By applying the ESCO model, businesses can gain access to green solutions, equipment and technology innovation and achieve efficiency in investment.
“It also helps businesses participate in national and international programmes and projects in the economical and efficient use of energy, contributing to environmental protection and coping with climate change.”
Public lighting, commercial and service buildings, industrial manufacturing, power distribution, and renewable energy are potential areas for ESCO investment, he said.
Statistics show there are more than 200 energy efficiency service suppliers and energy efficiency consulting firms, but the number following the ESCO model is low.
Speakers at the workshop agreed that the model is still new in Viet Nam and faces hurdles due to a lack of legal support, mechanisms and financial support for implementation of energy-efficient projects and unavailability of manpower.
Besides, customers’ distrust, risks in undertaking energy efficiency projects and businesses’ greater focus on boosting sales than reducing costs through energy savings are other obstacles to ESCO activities, they said.
The workshop heard about lessons learnt in other ESCO markets such as the US and China and the experiences in Viet Nam from foreign experts and representatives of local companies.
Hiep said to boost ESCO activities, improving the institution and legal framework for it, developing a sustainable financial mechanism, and creating linkages between ESCO enterprises and credit institutions are imperative.
Toby Couture, director of E3 Analytics, said in-depth skill training is critical.
The Government could lead by example and invest in ESCO and energy efficient services, but ensuring legal issues of energy performance contracts was important, he said.
Financial support including loan guarantees and favourable tax treatment could be a catalyst for the growth of the market, he added.
Organised by the EU-Viet Nam Energy Facility project and the Ministry of Industry and Trade, the workshop titled ESCO, a future business model for Viet Nam sought to share experiences in developing the ESCO model in Viet Nam and raise awareness of government management agencies so that an appropriate policy framework could be adopted in future.
Association proposed to tax apartment rental business on Airbnb
The HCM City Real Estate Association has proposed the short-term apartment rental business be taxed, to better manage business operations on Airbnb and similar online platforms which is developing rapidly in big cities.
The association said that recent years saw a boom in the short-term rental business in major cities but the current established laws, including the Law on Housing 2014 and the Law on Real Estate Business 2014, does not have regulations in place for the operation of this business.
The Law on Housing 2014 banned the use of apartments for non-residential purposes. The problem was the law recognised landlord’s leasing rights but did not allow using apartments to be used as places for business registration.
The association said in many countries, landlords who ran short-term rental business on Airbnb must register their business and pay tax. In addition, their apartments could be used for lease in certain times of the year following the agreements with the local authorities or with the affected neighbours.
Viet Nam does not have the correct legal framework for this kind of business, the association said.
Chairman Le Hoang Chau said established laws should be amended towards the short-term rental business and landlords must register their business and pay taxes.
It could be put into consideration that Airbnb landlords must also pay additional fees for apartment operation management services.
Chau said this was a business model of a sharing economy in the industry 4.0, adding that Government should develop legal framework to manage this operation.
“An adequate and proper legal framework for short-term rental business will not only help promote the positive development of the sharing economy business model but also generate revenue for the State,” Chau said.
Senior director of Savills Vietnam Su Ngoc Khuong said the short-term apartment rental business had benefits, including providing more accommodation options and increase accommodation capacity to attract more tourists. In addition, landlords could earn income from renting houses.
“If this business model is well managed, Viet Nam can earn a large amounts of foreign currency and the collect more tax,” he said.
A report by Grant Thornton in 2019 showed the Airbnb rental market saw rapid growth in Viet Nam with the participation of about 30,000 housing units, from 6,500 units in 2016 and 16,000 in 2017.
Despite taking a hit by the COVID-19 pandemic, experts predicted the business would soon recover along with the tourism industry.
MSCI to change reclassification path, put pressure on VN market
Morgan Stanley Capital International (MSCI) has suggested the weight of Kuwaiti shares in its frontier markets basket will be curbed gradually to avoid shocks for other markets in the basket.
On April 8, MSCI announced the Kuwaiti market would be upgraded to the emerging markets level from its frontier markets rank in November.
The change would be done once and all Kuwaiti shares would be removed from the frontier markets basket.
As of October 21, Kuwait shares accounted for 25.54 per cent of MSCI Frontier Markets 100 Index. The re-classification of Kuwaiti shares is forecast to boost the foreign capital that flows into other frontier markets, including Viet Nam.
In the latest suggestion, MSCI said the weight of Kuwaiti shares in the frontier markets group would be cut five-fold.
In November 2020, 20 per cent of Kuwaiti shares will be removed from the frontier markets basket. The figure will increase to 25 per cent in February 2021, 33 per cent in May 2021, 50 per cent in August 2021 and 100 per cent in November 2021.
The suggestion means it will take another year for other frontier markets, including Viet Nam, to fully enjoy the flock of foreign capital escaping from Kuwaiti shares.
MSCI said it will collect feedback from financial firms until October 30 and the result will be announced by November 9.
Calculations by MSCI showed if the suggestion is approved, the cap of Vietnamese shares in MSCI Frontier Markets 100 Index will increase to 15.76 per cent in November 2020.
In November 2021, it is projected that Vietnamese shares will account for 28.76 per cent of the frontier markets index when all Kuwaiti shares are moved to the emerging markets basket.
The second-largest frontier market will be Morocco, which is forecast to make a cap of 12.47 per cent in the basket.
The iShare MSCI Frontier 100 ETF is the only exchange-traded fund that uses the MSCI Frontier Markets 100 Index as its benchmark. As of October 21, the size of the fund was worth US$387 million with the total value of Vietnamese shares accounting for 12.47 per cent of the fund value.
According to MB Securities JSC, in the case of suggestion being approved, iShare MSCI Frontier 100 ETF will buy an additional amount of VND270 billion (US$11.6 million) worth of Vietnamese shares in November 2020. The total purchase is estimated at VND1.41 trillion when the reclassification ends in November 2021.
One more solar power plant inaugurated in Ninh Thuan
The 50-MWp Ha Do Ninh Phuoc solar power plant was officially inaugurated in Ninh Phuoc district in south-central Ninh Thuan province on October 24.
Invested by Ha Do Group, the plant covers an area of 58.7 ha in Phuoc Thai and Phuoc Ninh communes.
It uses the most modern and advanced technology of Germany.
In addition, it also uses Mono Perc monocrystalline panels with the capacities of 410 Wp and 415 Wp, from Sunpower firm of the US, and a 22kV smart substation system incorporating with a 6.3-MW converter, helping to reduce investment costs and transmission losses.
According to Nguyen Trong Minh - Vice Chairman of the Board of Directors of Ha Do Group, the plant officially generated to the national grid on September 1.
The project is expected to contribute about 92 million kWh of electricity to the national grid and about 37 billion VND to the State budget per year.
Speaking at the inauguration ceremony, Chairman of the provincial People Committee Luu Xuan Vinh said local authorities have so far handed over investment decisions to 34 solar power projects worth over 62 trillion VND, with a combined capacity of 2,343 MW, 31 of which have been put into commercial operation with a total capacity of about 2,123 MW./.
Binh Thuan hosts workshops on national tourism area management
Over 200 experts, researchers and managers from departments of culture, sports and tourism nationwide gathered at a workshop on national tourism area management, which was held in the central-south province of Binh Thuan on October 24.
Delegates focused their discussion and analysis on the potential for developing national tourism areas, gave opinions on the national tourism management model proposed by the Vietnam National Administration of Tourism (VNAT), and proposed new suitable models of national tourism management.
According to the master plan on Vietnam's tourism development to 2020 with a vision to 2030 approved by the Prime Minister, the country will have 49 locations in 43 provinces and cities that are potential to develop national tourism areas.
As of October 2020, 22 locations have been planned to develop into national tourist areas.
Deputy General Director of VNAT Ngo Hoai Chung said localities are facing many difficulties and confusion in managing national tourism areas because the Government has not had relevant regulations.
Participants proposed the Government to quickly promulgate a general model of national tourism area management, thus guiding localities in applying.
Dr. Tran Van Thong from Ho Chi Minh City University of Finance said the Ministry of Culture, Sports and Tourism needs to build an interdisciplinary management model and clearly define functions and tasks for all management levels.
The general management model should ensure economic factors, preservation of culture and heritage values, natural resources, and local communities' identity , he stressed.
Recommendations at the workshop will serve as a basis for the Ministry of Culture, Sports and Tourism to propose an appropriate national tourism management model to the PM for approval, towards improving the efficiency of the management of national tourism areas as well as the quality of tourism products, contributing to making Vietnam's tourism a key economic sector soon./.
Safer houses help overcome floods along Thu Bon River
Located in the downstream area of major rivers, Duy Thanh commune in Duy Xuyen district, Quang Nam province resembles a lake every wet season. The commune has introduced a range of measures so that local residents can live together with nature and mitigate the damage caused by natural disasters, one of which is to assist people in building houses with an attic as a safe shelter.
Van Quat village is the lowest-lying area in Duy Thanh commune in Duy Xuyen district. During the flood season, the village is often surrounded by water and cut off from the outside world.
Duy Thanh commune is also where the Li Li and Ba Ren Rivers meet. It has more than 2,000 households in total. When flooding on the Thu Bon River reaches an alarming Level 3, more than two-thirds of households are submerged. In order to overcome the difficulties, most households, especially those in low-lying areas and areas near river banks, build houses with an attic.
According to forecasts, the downstream areas of major rivers in Quang Nam province in general and Duy Thanh commune in particular will remain flooded for a few more days. But thanks to having safe shelters, local people are able to mitigate the damage caused by natural disasters./.
Vietnam’s pepper exports forecast to recover
Vietnam’s pepper exports have shown signs of recovery, coming in at 45 million USD in September, a year-on-year surge of 22.2 percent.
According to the Ministry of Agriculture and Rural Development’s Agro Processing and Market Development Authority, the country shipped 18,000 tonnes of pepper abroad in the month, up 20.4 percent from the same time last year.
During the January-September period, the country earned 489 million USD from selling 220,000 tonnes of pepper to foreign countries, down 5.9 percent in volume and 17.6 percent in value year-on-year.
Experts forecast Vietnam’s pepper exports will get advantage in the time ahead thanks to robust signs from the main import markets like the US and India.
Besides, the European Union-Vietnam Free Trade Agreement (EVFTA) also opened various opportunities for Vietnamese pepper in the European market.
Vietnam’s pepper prices are expected to surge as pepper prices have started moving up globally.
Experts recommended local firms to promote connections with international partners so as to enlarge consumption markets while improving product quality./.
State Audit Office contributing to comprehensive socio-economic renewal
The State Audit Office of Vietnam (SAV) has made a range of contributions to and affirmed its role in the country’s comprehensive socio-economic renewal process for more than 20 years.
Assuming the role of Chair of the Asian Organisation of Supreme Audit Institution (ASOSAI) for the 2018-2021 term expresses the recognition from international friends of the capacity the SAV possesses.
From a Government office to an agency elected by the National Assembly (NA), the SAV has continuously affirmed its vitally important legal status, which is stipulated in the Constitution 2013.
The office’s two-decade journey of formation and development has always been closely connected to the nation’s renewal and integration cause, and conforms to Party and State policies.
The State Audit Development Strategy to 2020, approved by the NA Standing Committee in 2010, sets the target of turning the SAV into an important office supervising public finance and assets, with prestige and responsibility and able to fulfil all tasks assigned to it by the Party, State, and people.
Vice Chairman of the National Assembly, Phung Quoc Hien, said the agency’s operations over recent years have actively contributed to verifying the annual State budget balance.
The SAV has made every effort to resolve issues that arise when auditing State management in the new period of national development, such as investment in basic construction and spending related to financial activities.
Specifically, the control exerted by the SAV has helped increase budget revenues and cut unreasonable expenses. The larger volume of data released by the agency over the past year made financial, budgetary, and public asset management more transparent and effective, thus serving as a foundation for the legislature to make more accurate decisions on fiscal and monetary policies as well as other important issues. The SAV has also contributed to building and perfecting the legal framework, particularly in the financial and budgetary spheres.
In recent years, along with comprehensive renewal, Vietnam has stepped up its extensive international integration and contributed actively to multilateral mechanisms. As a responsible member of regional and global cooperative mechanisms, it has successfully hosted many major international events, such as the World Economic Forum on East Asia in 2010, the 132nd International-Parliamentary Union (IPU) Assembly in 2015, the APEC Economic Leaders’ Meeting in 2017, and the 26th Asia-Pacific Parliamentary Forum (APPF) meeting in 2018.
The success of these events not only affirms the importance of a multilateral forum or a regional or global cooperation mechanism, but also increases Vietnam’s role and standing in the international arena.
The SAV has also joined hands in intensifying the country’s external affairs. Hosting the 55th meeting of the ASOSAI Governing Board helped improve the external activities of the State, including those of the legislature.
The NA’s Standing Committee has issued a resolution on the development strategy for the SAV in the 2021-2030 period.
The resolution highlights the view that the SAV, as an agency set up by the NA, will operate independently and in accordance with the law, upholding the core values of Independence - Integrity - Professionalism - Prestige - Quality, and contributing to the development of stable, sustainable, and transparent national finances.
The development of the SAV should match the actual situation in the country, while meeting the requirements of international integration process and following international principles and practices in the field.
The resolution sets overall targets for developing the SAV into an effective and important tool of the Party and the State in inspecting and supervising the management and use of public finances and assets, enhancing the accountability and transparency of agencies funded by the State budget, effectively serving the operations of the National Assembly and the Government, and supporting local People’s Councils and People’s Committees in management, supervision, and decision-making./.
Encouraging outcomes seen in support plan for the disabled
A plan on support for persons with disabilities (PWDs) between 2012 and 2020 (Plan 1019) has gained certain encouraging outcomes, helping to improve the group’s living standards and access to equal opportunities, heard a recent conference in Ninh Binh province.
Deputy Minister of Labour, Invalids and Social Affairs Le Tan Dung, who is also vice chairman of the national committee for PWDs, said Plan 1019, a major programme showing the Party and State’s attention to the disabled, has helped raise sectors and authorities’ awareness of and sense of responsibility towards PWDs, improve the group’s material and spiritual lives, and remove social barriers, thus creating equal chances for them to access basic social services, tap into their ability, and integrate into society.
Chairman of the Vietnam Social Security Fund Ta Viet Anh noted outcomes in the early detection, early intervention, orthopaedic surgery, and provision of supporting tools for PWDs between 2012 and 2020.
Each year, there are about 90 percent of pregnant women receiving prenatal disability screenings, 60 percent of children under 6 accessing postnatal screenings, and about 2,000 orthopaedic and supporting tools supplied for PWDs.
Over the last eight years, the Ministry of Education and Training has promoted inclusive education and carried out priority policies for disabled students as well as teachers engaged in inclusive education.
The number of students with disabilities going to school has increased 10-fold compared to the 2000-2010 period with improved quality. About 2,000-2,500 teachers have received training in inclusive education every year while 1,500 free braille boards and books been given to disabled students.
During the period, 17,000-20,000 PWDs received vocational training, 20,000 got job suggestions, and over 38,500 got loans from the national employment fund each year. Nearly 28,800 PWDs with financial problems were provided with legal assistance, and 400,000-500,000 families of PWDs and disabled persons received training in caring for PWDs, statistics show.
The plan on support for PWDs for 2021-2030 is set to remain in line with the UN Convention on the Rights of PWDs, the UN 2030 Agenda for Sustainable Development, and relevant commitments of ASEAN. It will push ahead with programmes on assisting PWDs and encourage them to overcome difficulties, integrate into society, contribute to socio-economic development, and help their peers.
There are about 6.2 million PWDs in Vietnam at present, accounting for 7.06 percent of the population aged 2 and above. About 58 percent of them are female, and 28.3 percent are children./.
Indonesia to reduce exports of unprocessed coal
Indonesian President Joko Widodo has ordered his cabinet ministers to set a target of reducing exports of unprocessed coal and accelerate plans to develop derivative industries for processing the fuel in Southeast Asia’s biggest economy.
Indonesia, the world’s biggest thermal coal exporter, should quickly develop a local industry to upgrade, liquefy and gasify its coal, the president said, urging ministers to determine the volume of output that could be used for such processing.
The Indonesian government aims to partially replace imports of liquefied petroleum gas (LPG) used by Indonesians as fuel with dimethyl ether (DME) made from coal.
Widodo also asked the cabinet ministers to come up with a roadmap for coal optimisation to boost the development of the domestic coal sector using environmentally-friendly technologies.
Indonesia has been seeking to squeeze more value out of its rich mineral resources ranging from copper to nickel by processing raw materials at home.
State-controlled coal miner PT Bukit Asam is currently building a coal gasification plant which is due to produce 1.4 million tonnes of DME per year from 2025.
Indonesia produced 610 million tonnes of coal last year and has targeted 550 million tonnes in 2020. Most of Indonesia’s coal is exported, with the rest mainly used in power generation.
Indonesia’s coal output reached 370 million tonnes in the first eight months of this year, or 67.3 percent of the yearly plan, according to the General Department of Minerals and Coal under the Indonesian Ministry of Energy and Mineral Resources./.
US mission explores investment opportunities in Vietnam
A US mission led by Adam Boehler, chief executive officer of the US International Development Finance Corporation (DFC), is touring Indonesia, Vietnam and Myanmar to seek investment opportunities from October 23-27.
He is accompanied by Kimberly Reed, Chairman and President of the US Export-Import Bank, along with other officials of a number of US departments of finance, commerce, state, and energy.
Boehler is scheduled to meet government officials and business executives of the host countries to look into investment opportunities and ways of increasing cooperation and spurring economic growth.
The DFC has committed to increasing investment in the Indo-Pacific, considering it a priority in its development strategy for the sake of long-term prosperity and security in the region.
Boehler visited Vietnam in January this year. He told Prime Minister Nguyen Xuan Phuc at the January 8 reception that US President Donald Trump has highly valued cooperation with Vietnam.
He voiced his commitment to invest in Vietnam, especially in the fields of energy, health, and infrastructure. As Vietnam takes the role of the ASEAN Chair in 2020, the DFC desires to cooperate with the Southeast Asian nation to invest in infrastructure connecting five countries in the Mekong region.
Through previous meetings with Vietnamese ministries, branches and authorities, he highly appreciated Vietnam’s improved legal framework on PPP investment, thereby facilitating private investment.
Phu Yen greenlights planning of northern urban area of South Phu Yen Economic Zone
Phu Yen People’s Committee has approved the 1/2,000 scale construction planning of the coastal service urban area in South Phu Yen Economic Zone (Dong Hoa town).
Phu Yen approved the planning of the urban area component of South Phu Yen Economic Zone
Phu Yen People’s Committee has recently issued a decision to approve the 1/2,000 scale construction planning of the coastal service urban area in South Phu Yen Economic Zone (EZ). Covering a total area of 284.3 hectares, the area is expected to house a population of 19,890 people.
The decision assigns Phu Yen Economic Zones Management Authority to be in charge of the planning. The move is part of the efforts to realise the 1/10,000 scale general planning of the construction of South Phu Yen EZ by 2025, which has been approved by the prime minister.
The project will combine an urban service area and a green area of coastal plants, in line with the general planning orientation of the EZ. The project aims to maximise the efficiency of land use in the planned area.
A research has proposed adjustments for a section of Hung Vuong Road to increase efficiency in exploiting the land fund in the northern area of the EZ, creating a driving force for development.
The tourism service and urban complex in the north of South Phu Yen EZ will be developed with synchronous, modern infrastructure, in addition to promoting environmental protection.
According to the local authorities, the decision lays a foundation for implementing the 1/500-scale detailed construction plan of the project, attracting investment resources and setting up investment projects to build technical and social infrastructure, according to the approved planning.
In addition, the decision will regulate land use planning and landscape design, as well as urban design. The technical infrastructure planning has selected a coastal road as the main axis for the urban area. This road will be adjusted to run along the planned area, connecting the north and south. 57m wide, the road will provide convenient access to Tuy Hoa Airport (in the north) as well as the economic centre and railway station (in the south).
MoSC sets up alliance for venture investment funds
Aiming to better support deals between investors and startups, Project 844 under the Ministry of Science and Technology is developing an alliance of venture investment funds in Vietnam.
This was shared at the seminar on October 23 titled “Luring in venture capitals for startups” as part of startup events for TECHFEST 2020.
Capital mobilisation is an inevitable factor for the development of startups in Vietnam and over the years, local and overseas funds have constantly invested in startups, contributing to this thriving ecosystem. In 2019, Vietnam saw nearly $800 million investment poured into the field, only a little less than in 2018, when it was nearly $900 million.
However, in a regional comparison, these inflows are modest. According to Tech in Asia, total investment in startups in Indonesia ($1.7 billion) was as much as 28 times higher in 2017 than in Vietnam.
As such, long deal-making times have contributed a great deal to this. Hoang Thi Kim Dung, a representative of Japan-based Genesia Venture, said that failing to reach a common stance among local and foreign investors, as well as angel investors, have delayed capital disbursements for startups, extending the timeline for a deal to at least 18 months, including 12 months for capital mobilisation and six months for an investment decision.
“Therefore, it is necessary to have the alliance to materialise the deals quickly,” said Dung.The collaboration will facilitate discussions between startups and investors.
“The most important thing is to prepare for the presentation of their (startup) performance and potential. Failing to match the KPIs as committed is the biggest mistake of startups in general,” said Nguyen Xuan Dong, co-founder of Ecomobi.
Also at the seminar, Bui Thanh Do, director and co-founder of Thinkzone Ventures said that he is in the progress of mobilising investment funds and law companies to participate in the alliance aiming to narrow the distance between policymakers and startups then step-by-step improving the investment climate. At the same time, the alliance is also a place for discussing and sharing experiences between startups, boosting information exchange in the startup community.
“The alliance will partner up with Project 844 to jointly accelerate the evolution of the Vietnamese startup ecosystem,” said Do.
A crucial time for transformation
Vietnam's economic growth achievements as well as its resilience against the COVID-19 pandemic have been highly appreciated by participating economists at the annual Vietnam Reform and Development Forum 2020, which was recently held in Hanoi.
The economy which can respond quickly to the crisis will also find opportunities from significant changes created by COVID-19. Many experts shared a common view that COVID-19 is an opportunity for Vietnam to move up the global value chain since the economy has high level of openness and has become a bright spot in attracting foreign direct investment (FDI).
However, Vietnam's participation in global and regional value chains remains limited as the level of Vietnam’s sophistication in participation in the supply chain remains low.
The World Bank has estimated that a 1% increase in GVC participation is estimated to boost per capita income levels by more than 1% - about twice as much as conventional trade, so strengthening global value chain participation will be important for accelerating Vietnam’s productivity and growth.
Moreover, Vietnam is also a country which has deeply integrated into the international economy by participating in 13 free trade agreements, including many new generation free trade agreements including the EU-Vietnam Free Trade Agreement (EVFTA), Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
This is also a great opportunity for the economy to further integrate and deeply participate in the world production network and attract quality FDI projects to move up the global value chains.
The COVID-19 pandemic is changing the situation of global trade and the global supply chain, which has creating new opportunities for Vietnam, especially in attracting FDI.
Before COVID-19, Vietnam was an attractive destination in the ASEAN region for FDI attraction, and the opportunities for Vietnam are now even bigger greater as the country has initially succeeded in preventing epidemics and gradually making growth recovery whilst other countries are still struggling to contain COVID-19.
At the moment, we absolutely have the right to opt to optimise the use of FDI while promoting transformation in the digital economy rather than simply attracting a lot of FDI.
It is a crucial time for Vietnam’s transformation towards rapid and sustainable development. The transitional period requires us to proactively develop a strategic direction with a breakthrough and bold mind-set in order to catch up and go along with the world’s development. Opportunities are wide open, but it's important to find a sound way and to take action to turn opportunities into reality.
International experts and scholars have recommended that Vietnam should be well prepared to join the global supply chain by developing a vibrant and creative private economic sector which has close links with the FDI sector while improving the quality of education.
Positive export figures after two months of EVFTA being in effect
The effectiveness of the EU-Vietnam Free Trade Agreement (EVFTA) has brought about huge opportunities for Vietnamese enterprises with exports to the EU market witnessing positive signs.
Deputy Minister of Industry and Trade Tran Quoc Khanh made the remark at a conference on the evaluation of the implementation of the rules of origin in the EVFTA that was held in Ho Chi Minh City on October 17.
According to Khanh, seafood is one of the commodities that was able to take advantage of tariff incentives right after the agreement came into effect.
Vietnamese seafood exports to the EU and UK reached US$263 million in August and September, up 17.1% over the same period last year.
Some items witnessed increases in export turnover from the beginning of September. Thanks to the use of tariff quotas under EVFTA, Vietnamese rice export in September reached US$1.74 million, up 168% month-on-month.
Footwear exports, though strongly affected by the demand drop due to the COVID-19 pandemic, also increased slightly in September, recording a figure of US$307.07 million, up 3.5% from the previous month.
In addition, nearly 15,000 sets of EUR.1 certificates of origin (C/O) were granted to Vietnamese products, worth a total of US$700 million, allowing them to export to 28 EU countries.
The items granted with EUR.1 C/Os are mainly related to footwear, seafood, plastic products, coffee, textiles, bags, suitcases, vegetables, rattan and bamboo products, agricultural products and electronic products, amongst others.
Deputy Minister of Industry and Trade said that, based on the results of export growth, Vietnam has made good use of tariff preferences in FTAs signed to expand export markets, particularly the EVFTA.
However, the access to the EU market still faces difficulties despite high tax incentives. Thus, Vietnamese enterprises need to meet many other regulations regarding non-tariff barriers, including regulations on the origin of goods, to fully utilise the agreement.
Domestic aviation on the way to recover
The Vietnam's Civil Aviation Authority announced on October 25 that as of mid-October, due to the impact of the COVID-19 pandemic, although the number of international visitors showed no signs of recovery, the number of domestic tourists is on the way to recovering.
The number of passengers through airports reached 52.8 million, down 45.5% over the same period last year, withinternational arrivals at 7.1 million, down 79.4%; domestic passengers at 45.7 million, down 26.8%).
The output of operating flights to/from of the whole country reached 263,000, down nearly 37% over the same period last year; and transit flights reached 124,000 flights, down 67.4%.
Over 200 Vietnam firms to join Factory Network Business Expo Hanoi 2020
The Factory Network Business Expo (FBC Hanoi) 2020 will take place on October 28-29 and is expected to see the largest transaction volume and value.
Nearly 230 manufacturers and 20 large buyers will join online and on-site business meetings at the FBC Hanoi 2020 at the Hanoi Agricultural Promotion Center.
Each enterprise at the expo will be arranged a maximum of 20 business matching sessions in the two consecutive days.
Visitors can book appointments and make on-site and online business matching sessions for free. It is an opportunity for small and medium enterprises to directly approach giants in the manufacturing industry. Vietnamese businesses can also meet face to face with Japanese and Thai buyers without traveling abroad.
According to the municipal Department of Industry and Trade, in the difficult business context created by the Covid-19 pandemic and the wave of relocating factories to Southeast Asia, FBC Hanoi 2020 is a good opportunity for Vietnamese businesses to promote and introduce products, seek customers, connect business as well as expand markets. Meanwhile, foreign businesses could visit and inspect their Vietnamese partners’ potential.
In addition, international seminars on supporting industry development will be held on the sidelines with the participation of representatives from relevant ministries, departments, and sectors from Vietnam and abroad.
FBC Hanoi 2020 is organized by the Department of Industry and Trade of Hanoi in coordination with Factory Network Asia Group and NC Network Vietnam JSC.
Held since 2017, FBC Hanoi has created positive results to support industry companies. Concretely, it facilitated more than 3,000 transactions with an estimated transaction value of almost US$4.5 million in 2017, almost 4,000 transactions with an estimated transaction value of almost US$5 million in 2018.
Vietnam hopes for stronger partnership with US: PM
Vietnam always considers the US one of its most important partners and wishes to continue developing its comprehensive partnership with the country, especially in economic, trade, and investment cooperation, Prime Minister Nguyen Xuan Phuc has told US officials.
At a reception in Hanoi on October 26 for the CEO of the US International Development Finance Corporation (DFC), Adam Boehler, and representatives from the US Department of Treasury (USDT), Department of Commerce, and the US Export-Import Bank (US EximBank), the PM affirmed that the Vietnamese Government always supports and accompanies the business communities of the two countries in orientating, connecting, and improving investment efficiency.
Ministries, sectors, and localities in Vietnam create the most favourable conditions possible for US businesses to invest and do business in the country, he added, asking that the DFC soon invest in major projects, such as the North - South Expressway and Long Thanh International Airport.
The PM emphasised that Vietnam attaches great importance to and highly values the US’s active participation in the US-Mekong Partnership.
The DFC’s investment expansion into the Mekong region will be the foundation for building a dynamic, resilient, and sustainable Mekong region and a strong ASEAN, he noted.
Vietnam and the US are co-chairs of the US-Mekong Partnership in 2020, so it is necessary to organise a summit shortly, he said.
The PM asked the DFC chief to talk to President Trump, the US Trade Representative Office and other US agencies about helping Vietnam implement the action programme towards harmonious and sustainable trade adopted at the end of 2019, as well as about making more objective assessment about the realities in Vietnam so as to carry out suitable cooperation for mutual benefit and development in harmony with US’s commitment to supporting a strong, prosperous and independent Vietnam as well as the bilateral comprehensive partnership.
He suggested that the DFC and relevant Vietnamese agencies identify investment opportunities in potential infrastructure and energy projects and those with high technology content in Vietnam and the Mekong region.
For his part, Boehler revealed that the DFC will increase its investment in Vietnam in the time to come, saying that the US EximBank also wants to further strengthen cooperation with the country.
He noted that the two countries have made positive progress in energy cooperation through ongoing projects, adding that the DFC is also looking for investment opportunities in Vietnam’s infrastructure sector.
The representative from the US EximBank expressed a desire to boost US exports to Vietnam and hoped for stronger cooperation between the two countries.
The US Congress has approved a new tool for the bank to promote cooperation with other countries, including Vietnam, the representative said, noting that the bank can provide financial support in terms of renewable energy, transportation, aviation, health, agriculture, and 5G technology.
Meanwhile, the USDT representative hoped that the two countries would expand cooperation in private economic areas, and ties with the State Bank of Vietnam. The Department of Commerce said the two sides can promote partnership in aviation, healthcare services, and infrastructure development.
Two-way trade between Vietnam and the US has increased more than 170-fold since 1995. US exports to Vietnam are growing at the fastest rate of all its Southeast Asian partners. Many US businesses are investing and doing business in Vietnam, with the US among the 10 largest investment partners in the Southeast Asian country.