The headquarters of the Ho Chi Minh Stock Exchange (Photo: HoSE)

The Ho Chi Minh Stock Exchange (HoSE) posted 553 billion VND (23.9 million USD) in 2020 after-tax profit, a record figure that grew 46 percent year on year.

According to its recently released audit report, HoSE earned 993 billion VND in net revenue last year, up 39 percent from the previous year.

The revenue mostly came from stock trading service fees which totaled 873.4 billion VND, up 45 percent year on year.

After deducting expenses, the exchange saw a record of 553 billion VND in post-tax profit.

In 2020, the average liquidity per trading session on HoSE reached 6.19 trillion VND, rising 58 percent from the previous year. Money continued flowing into the market this year, helping liquidity frequently top 15 trillion VND each session, which will have positive impact on HoSE’s business performance this year.

For 2021, it aims at 1.065 trillion VND in revenue, up 7.3 percent, and 648.3 billion VND in pre-tax profit, down 6 percent from 2020./.

Market to rally despite early corrections

Experts from securities companies said although the market may experience corrections early this week, it will soon return to an uptrend thereafter.

The market benchmark VN-Index on the Ho Chi Minh Stock Exchange (HoSE) rose 0.45 per cent to close Friday at 1,283.93 points.

It had gained 1.39 per cent last week.

More than 717.8 million shares were traded on the southern market last week during each session, worth VND22.3 trillion (US$964.4 million).

According to SSI Securities Joint Stock Company, after recovering from 1,250 points, the VN-Index was approaching the nearest peak at 1,286 points.

“It is likely that the index will see a slight correction when testing this resistance area before returning to the uptrend towards 1,350 - 1,400 points,” SSI said.

MB Securities Joint Stock Company (MBS) said in general, the market had favourable conditions to go up to higher thresholds. However, the market was still facing difficulties due to system overloads.

BOS Securities Joint Stock Company said technically the VN-Index had surpassed 1,280 points with the support of strong cash flow.

However, the increasing divergence in the market and the adjustment pressure in blue-chips might affect the market in the coming sessions.

Most likely, the VN-Index would maintain the uptrend and move towards the resistance level of 1,300 points in the short term.

Regarding the movements of stocks, most of the stock groups increased last week. Information technology stocks increased the most, mainly due to the increase of pillar FPT Corporation (FPT), up 10.6 per cent.

It was followed by the oil and gas group, mainly thanks to the momentum of the pillars in the group, including Viet Nam National Petroleum Group (PLX), up 4.7 per cent.

Bank stocks also gained strongly last week, with notable gainers of Bank of Investment and Development of Vietnam (BID), up 5.7 per cent, Military Bank (MBB), up 5 per cent, Techcombank (TCB), up 4.4 per cent, Asia Commercial Bank (ACB), up 2.9 per cent, Vietinbank (CTG), up 2.7 per cent, VPBank (VPB), up 1.8 per cent, Saigon-Hanoi Bank (SHB), up 1.7 per cent.

The construction materials group rose with Hoa Phat Group (HPG) rising 6.8 per cent and Hoa Sen Group (HSG) climbing 3 per cent.

According to Saigon-Hanoi Securities Co (SHS), the market was witnessing large divergence between stocks with only a few gaining compared to many others falling or moving sideways, making it difficult to earn profits at this time.

“When the cash flow decides to withdraw, it is likely that the market will correct sharply like what happened in April 2018,” SHS said.

“It is obvious that the Vietnamese stock market has reached a historic peak thanks to internal supportive elements, one of which being strong domestic cash flow,’ it said.

Meanwhile, on the Ha Noi Stock Exchange (HNX), the HNX-Index gained 0.98 per cent to close Friday at 297.99 points.

It had gained 1.1 per cent last week.

An average of 144.2 million shares were traded on the northern market during each session last week, worth VND3.1 trillion. 

Key maritime projects stuck in the mud without public funds

Four urgent maritime projects might need to wait for other sources of funding to get off the drawing board, as the Vietnam Maritime Administration was required to return their funding to the state coffers.  

Checking work progress at the Phan Thiet channel dredging project, one of the five urgent maritime projects
During .2014-2016, the Vietnam Maritime Administration (VMA), under the management of the Ministry of Transport (MoT), had performed effective measures leading to a sharp rise in the number of vessels and goods passing through local ports.

This resulted in marine safety fees collected annually during the period consistently exceeding projections. During this three-year period, marine safety fee collections exceeded the projection by VND746.7 billion ($32.5 million), including VND420 billion ($18.26 million) in 2016 alone. 

Based on the VMA’s proposal, in late 2016 the MoT asked the government for permission to use this excessive sum to implement several urgent maritime investment projects, particularly on infrastructure development, material base, and equipment procurement to ensure marine safety.

In December 2017 the government provided in-principle approval for the MoT to use this excessive sum to invest in five urgent projects.

The projects cover dredging Phan Thiet marine channel in the southern province of Binh Thuan; building a brand-new specialised rescue ship for offshore activities; establishing the Cospas Sarsat new-generation satellite tower; building several marine channels and stations; and erecting beacon works.

However, up to the end of 2020, of the five projects, only the one on dredging Phan Thiet marine channel was completed, the four others remained in the investment preparation stage.

That explained why, in the auditing report 146/KTNN-TH dated July 17, 2020 on the MoT's use and management of public finance and public assets in 2019, the State Audit of Vietnam (SAV) ordered the repayment of the VND746.7 billion ($32.5 million) to the state coffers, following regulations in the Law on Fees and Charges 2015.

However, in a recent dispatch to the MoT, the VMA requested the MoT to seek permission from the SAV to hold back VND26.83 billion ($1.17 million) of the sum to clear unsettled payments at the Phan Thiet marine channel dredging project which has been completed, as well as pay for implemented work items and consultants who work on the investment preparation stage of four other projects.

The remaining VND721 billion ($31.35 million) shall be contributed to the state coffers in compliance with SAV's decision. 

At the channel dredging project, the unpaid amount to contractor and technical design units reportedly amounted to around VND25.9 billion ($1.13 million), not including some provisional fees.

In the dispatch, signed by VMA chief Nguyen Xuan Sang, the body also asked the MoT to soon submit proposals to relevant authorised agencies asking for capital allocation from the medium-term public investment budget for 2021-2025 to fund these four urgent projects, getting them off the drawing board to be attuned with the prime minister instruction.

The VMA has attributed the late enactment of relevant guiding documents on the use and allocation of the excessive sum as the main reason why they failed in completing the urgent projects sooner.

In fact, the Ministry of Planning and Investment enacted a document guiding the MoT on the use and allocation of the sum in May 2020 after the Law on Public Investment version 2019 came into force (January 1, 2020).

Vietnam removed from list of beneficiaries of EAEU tariff preferences under GSP

Vietnam will be removed from the list of countries entitled to tariff preferences offered by the Eurasian Economic Union (EAEU) under the Generalised Scheme Preferences (GSP) from October 12, according to the Ministry of Industry and Trade’s Vietnam Trade Promotion Agency (Vietrade).

The move is likely to have tremendous impacts on Vietnamese exporters to EAEU countries, namely Russia, Belarus, Kazakhstan, Armenia and Kyrgyzstan, particularly Russia which remains the Southeast Asian country’s biggest buyer in the bloc, the Vietrade said in an announcement last week.

The agency recommended exporters to come up with plans to adapt to the change and to explore tariff preferences and corresponding preferential rules of origin under the EAEU – Vietnam Free Trade Agreement in place of the GSP.

Vietnam is among 75 developing countries removed from the list, alongside two least-developed nations.

Despite impacts of COVID-19, two-way trade between Vietnam and the EAEU expanded 6.5 percent to 5.2 billion USD last year, of which Vietnam’s exports to the EAEU totalled 3.1 billion USD and imports 2.1 billion USD, up 7.2 percent and 5.5 percent, respectively, from the previous year.

Of the figure, trade with Russia accounted for 93.7 percent./.

Human resources - decisive factor behind logistics sector's development

It is widely considered that human resources will be a key factor in helping Vietnamese logistics firms keep pace with other countries, enhance their overall competitiveness, and expand markets both domestically and internationally.

At present, there are approximately 3,000 logistics enterprises operating in the nation, with the demand for logistics workforces expected to reach over 200,000 by 2030.

Furthermore, the demand for human resources among the domestic logistics sector currently meets roughly 10% of the market's demand.

According to information given by the Vietnam Logistics Business Association (VLA), along with difficulties faced in terms of finding capital sources, Vietnamese logistics businesses are facing a severe shortage of well-trained workers.

The results of a survey conducted by the association indicate the number of well-trained workers only accounts for between 5% and 7% of the number of employees working in the field of logistics.

Most notably, up to 85.7% of local firms must train and try to enhance the skills of their workforce through actual work. In particular, a number of large-scale enterprises have moved to invest in training centres aimed at developing greater human resources and managing supply chains for the sector.

Nguyen Thanh Phuong, general director of Sao Do Group, said the group has recently turned to investing in the logistics field and has subsequently encountered numerous difficulties in finding the necessary human resources, especially relating to a high-quality workforce.

Phuong underlined the need to boost linkages among training schools within the logistics sector, especially those with foreign investors, in order to develop the local workforce for this industry.

Tran Thanh Hai, deputy director of the Import-Export Department under the Ministry of Industry and Trade, said domestic logistics companies run  a shortage of highly-qualified human resources, pointing out that workers in this sector are typically not fully prepared for the wave of labour migration between ASEAN countries.

Hai went on to state the importance of devising solutions aimed at dealing with inadequacies in terms of labour discipline, the sense of law compliance, and low labour intensity to enhance the skills of the Vietnamese workforce in this field.

Industry experts also underlined the need to strengthen connectivity among relevant stakeholders, including the Government, local authorities, logistics enterprises, and vocational training hubs in order to develop relevant human resources for the sector.

Moreover, the State must strive to develop professional standards for the logistics filed, whilst implementing support for vocational schools as they invest in upgrading their facilities and equipment.

It is imperative to competently train workers with professional qualifications and skills, particularly those with an in-depth knowledge about their related field, foreign language skills, information technology, along with communication and negotiation skills to increase the capacity of firms amid rapid globalisation and the Industry 4.0,  Hai said.

Assoc. Dr. Ho Thi Thu Hoa, director of the Vietnam Logistics Research and Development Institute (VLI), described training high-quality human resources for the sector as an urgent necessity, adding that emphasis should be placed on training high-quality human resources who hold international diplomas in this field.

As a means of overcoming these shortcomings and creating more favourable conditions for the development of human resource within the logistics sector, the Ministry of Home Affairs issued a decision on April 30 to allow the establishment of the Vietnam Logistics Human Resource Development Association.

The primary objective of the association will be to develop human resources to work in the logistics industry, enhance the competitiveness of logistics enterprises, whilst  enabling the sector to achieve the goals set by the Government.

The association will also join forces with other associations in the field to make the Vietnamese logistics industry develop in a faster manner moving forward.

Vietnam- Australia trade revenue surges nearly 34 percent

Two-way trade turnover between Vietnam and Australia topped 3.63 billion USD in the first four months of this year, a year-on-year rise of 33.85 percent, according to Vietnamese Consul General to Australia Nguyen Dang Thang.

Speaking at a business cooperation conference held by the Vietnamese Entrepreneurs Association in Sydney (VEAS) on May 21, Thang said that exports of both nations to each other’s market increased in the period.

He described this as significant in the context that the COVID-19 pandemic caused an unprecedented disruption to the global economy and several nations, including those in Southeast Asia.

However, Thang said the trade value did not reflect the economic potential between the two nations, adding Vietnamese and Australian enterprises should not only trade traditional products like seafood, farm produce, minerals, garment and textiles, footwear and building materials, but also capitalise on the products that both sides have gained competitive edge in the global market.

He also called on the Australian businesses to invest more in the Vietnamese market, particularly in the fields they hold considerable experience and advantages such as processing, manufacturing, high-tech agriculture, and logistics.

Meanwhile, Chairwoman of the Export Council of Australia Dianne Tipping affirmed Vietnam and Australia have enjoyed the fastest trade growth in recent years, and the Southeast Asian country has become a more important trade partner of Australia.

Besides goods, they have seen an impressive growth in their trade in services, including fintech, health care and education, she said.

Boasting fast economic growth, expansion of middle-class population, young and dynamic workforce, stable socio-political environment, and better business climate, Vietnam is truly an ideal destination for Australia firms, she said, adding the Vietnam – Australia ties have been deepened across the fields of economy, security, defence, culture, education and people diplomacy.

Tipping affirmed that the two countries have many opportunities to branch out their economic-trade relations in the post-pandemic era.

The Export Council of Australia encourages Australian businesses to expand their business in Vietnam, particularly in the fields that have good growth in the future such as information technology, digital transformation, finance-banking, environmental services, health care, and beauty.

Tipping said her council has advised the Australian government to back trade promotion with Vietnam, especially giving supports to small- and medium-sized companies who are interested in investing in the Vietnamese market, as well as consider establishing a travel corridor between the two countries./.

Japanese beverage firm helps coffee growers in Vietnam

Japanese beverage company Kirin Holdings is stepping up support for coffee growers in Vietnam, amid a growing consumer demand for sustainable products.

Japanese newspaper Nikkei Asia reported that the company is training farmers in sustainable production methods, including soil management, helping them obtain certification from an international accreditation organisation that promotes sustainable farming.

Kirin aims to extend support to farms in 700 locations, double the current figure, by the end of the year.

The firm helps Vietnamese coffee growers get certification from the Rainforest Alliance, a US-based non-governmental organisation. To be certified, farmers must not only refrain from using excessive amounts of agrochemicals and work to protect biodiversity but also enhance production efficiency and quality, and improve conditions for farmworkers.

Since last year, Kirin has supported 350 Vietnamese coffee farms, helping growers conserve water, protect rivers from pollution and introduce better cultivation methods for areas with low sunlight.

Vietnam is the world's second-largest coffee bean producer after Brazil. Vietnamese coffee represents about 30 percent of the ingredients Kirin uses in its products.

Thanks to increased consumer awareness, sales of beans certified by the Rainforest Alliance grew sharply around the world last year, rising 15 percent from the previous year./.

Opportunities for Vietnam to maintain stable rice export to Philippines

The Philippines’s lowering tariffs on imported rice would open up opportunities for Vietnam to maintain stable supply of the product for the country and helping it stabilise the domestic market, the Vietnamese Ministry of Industry and Trade said.

However, given the fierce price competition with traditional rice exporters like Thailand and India, the ministry urged domestic firms to foster cooperation and connectivity with cooperatives and major farming households to minimise intermediate stages, thus cutting costs and enhancing competitiveness.

At the same time, exporters should study and observe relevant regulations set by the Philippines, including those on customs declaration, the ministry said, noting that they should negotiate and sign contracts with only businesses that have been granted with the Sanitary Phytosanitary Import Clearance (SPS-IC) by the Philippine Department of Agriculture.

They also need to keep updated on the market, as the tariff cut under the Philippine President's order can be changed anytime, and draw up plans to prevent business risks, while stepping up inspections and supervisions over rice quality to absolutely ensure the prestige of Vietnamese rice, the ministry suggested.

Earlier, in an executive order, Philippines President Rodrigo Duterte cut the Most Favoured Nation (MFN) tariff rates on rice to 35 percent from 40 percent for in-quota purchases and 50 percent for out-quota volume for one year.

According to the General Department of Vietnam Customs, in the first four months of this year, Vietnam shipped over 715,000 tonnes of rice valued at some 380 million USD to the Philippines, accounting for 36.27 percent of the total exported rice./.

Wind power sector attractive to investors, construction firms

With an increasing demand for electricity in Việt Nam, the wind power construction sector has flourished, with local and foreign firms getting in on the action.  

A top executive at Coteccons, one of the biggest realty firms in Việt Nam, told media the firm may invest in wind power construction due to the opportunities on offer.

Coteccons' deputy general director Phan Hữu Duy Quốc said: “We are associated with a large consulting enterprise in the power industry to participate in the bidding as an EPC general contractor of wind power projects,” adding, “In the future, we may consider investing in the field.”

Similar to Coteccons, realty firm Phát Đạt is considering investing in wind power while construction firm Licogi 16 is awaiting Government approval to implement four wind power projects in Gia Lai and Quảng Trị provinces with its Japanese and German partners.

Licogi 16 said it was studying some offshore wind power projects for potential future investment.

The firm Power Construction 1 plans to finish three wind power projects of Liên Lập, Phong Huy and Phong Nguyên in Quảng Trị Province before October 31 as it continues to survey, research and develop new projects in other areas.

With its experience from the construction of large hydroelectric and irrigation projects, the firm Construction 47 also plans to expand its work into wind power in the near future while the SCI E&C Company will execute the wind power projects Hướng Phùng 2&3, Gelex 1,2,3 and Hướng Linh 7&8 in Quảng Trị Province.

Known as the leading foundation engineering and underground construction company in Việt Nam, FECON Corporation is also building six wind power plants across the country.

Quốc from Coteccons told local media: “The profit margin for civil construction is approximately 5 per cent, while infrastructure and wind power construction can make a higher profit.”

According to a report from Vietnam Electricity (EVN), as of March 22, there were about 4.4GW of wind power projects under construction while a remaining 6.2GW would be developed in 2022-2025, based on the draft Power Master Plan 8.

Lots of foreign investors have also been reported to be mulling an investment in Vietnamese wind power.

Less than a month after Trung Nam Group inaugurated the largest wind farm of Việt Nam in Ninh Thuan, Hitachi SE's renewable energy business expanded its market to Việt Nam by signing a strategic co-operation agreement with the group, buying more than 35 per cent of the stake in the wind farm on May 14.

Seeing Trung Nam Group‘s 151.95 MW wind farm worth VNĐ4 trillion (US$172.4 million) with an estimated output of 432,000,000 kWh per year, as a quality, long-term and effective project, the Japanese investor bought in as a way to further implement renewable energy projects in Việt Nam.

This month, the Central Highlands province of Đắk Lắk granted in-principle investment approval to six foreign-funded wind power projects worth more than VNĐ10.08 trillion while the People's Committee of Hậu Giang Province did the same thing for a VNĐ3.2 trillion wind power plant project from Hong Kong’s Envision Energy Company.

According to SSI Research, assuming electricity consumption growth of about 7.6 to 8 per cent in 2022-2025, there was still room to deploy a wind power project with a capacity of 6.2GW.

According to the World Bank's assessment, Việt Nam is the country with the largest wind power development potential of Laos, Thailand, Cambodia and Việt Nam, with more than 39 per cent of Việt Nam's total area estimated to have an average annual wind speed per year greater than 6m per second at an altitude of 65m, equivalent to a capacity of 512 GW.

Investment in HCM City’s industrial parks up 23 percent

Investment in Ho Chi Minh City’s industrial parks and processing zones have risen by nearly 23 percent year-on-year so far this year to 236.1 million USD.

Foreign direct investment was worth around 125 million US, double the amount that came in during the same period last year.

Companies constructing factories and warehouses accounted for nearly 69 percent of the investment, with pharmaceuticals, software and food processing also accounting for major shares.

Hua Quoc Hung, head of the HCM City Export and Processing Zones Authority (HEPZA), said investment was increasing because Vietnam and HCM City had been controlling the pandemic well.

The city and his agency had been helping investors overcome problems caused by the pandemic and global economic instability, which would also attract further investment, he said.

But land was running out in the city’s industrial parks and processing zones, while new industrial parks were launching too slowly due to land compensation and legality problems, he said.

Hung said his agency would speed up the construction and opening of new industrial parks to offer more land to investors.

It would also work with other agencies to acquire more land for industrial zones for use in 2021 – 2025, he said.

Existing zones also have problems such as lack of technical infrastructure and pollution, he added./.

Binh Duong certifies $1b worth of FDI

Binh Duong Province approved nearly US$1 billion worth of new foreign investment last Friday.

Textile firm Polytex Far Eastern Viet Nam Co., Ltd., belonging to Taiwan’s Far Eastern Group, is investing $610 million to expand its polyester synthetic fibre manufacturing and spinning facility at the Bau Bang Industrial Park.

The conglomerate already has $1.37 billion worth of investment in Binh Duong.

Cheng Loong Binh Duong Paper Co., Ltd. is set to invest $100 million in its paper plant at the Protrade International Industrial Park, taking its total investment to around $1.1 billion.

Procter & Gamble Indochina Co., Ltd. will add $44.8 million to expand its razor blade factory at the Dong An Industrial Park.

Singapore-based New Motion Industrial Co. Ltd is set to invest $185 million to set up a display monitor manufacturing factory, warehouse and office at the Phu Tan Industrial Park.

Singapore’s Emergent VN Logistics Development Pre. Ltd will build the ECPVN Binh Duong 2 logistics centre at a cost of $34.4 million at the Tan Dong Hiep B Industrial Park.

Binh Duong ranks third in FDI this year after HCM City and Ha Noi as its efforts to improve administrative procedures and create a favourable investment climate pay off.

As of May 15 it had attracted $1.25 billion worth of FDI, a 59 per cent increase year-on-year. 

Indian companies eye Viet Nam medical devices market

Viet Nam could become a major export market for Indian medical device makers and also act as a springboard to other ASEAN countries, according to the Engineering Export Promotion Council of India.

Viet Nam imported around 90 per cent of its medical devices, with Japan, Germany, the US, China, and Singapore accounting for around 55 per cent, its chairman, Mahesh Desai, told an online India-Viet Nam Business Meet on medical devices held last week.

The local industry comprising around 50 manufacturers accounted for less than 10 per cent of the market share.

Indian companies could look to tap the burgeoning medical devices market, he said.

With its demand for medical equipment growing, Viet Nam had emerged as one of the most promising sectors for foreign investors, and its government offered tax incentives to promote the industry, he added.

"Many Indian manufacturers of medical devices and pharmaceuticals have already entered and invested in the Viet Nam market, which is a very positive sign."

Dr Madan Mohan Sethi, the Indian consul general in HCM City, said the medical device sector was one of Viet Nam’s most promising for foreign investment due to its rapid economic development and rising demand for medical care.

"There is a lot of untapped potential in this area. The COVID-19 crisis provides an opportunity for both sides to join hands and set up alternative global supply chains for various products that have been disrupted by the pandemic.”

Doan Quang Minh of the Ministry of Health’s department of medical equipment and infrastructure said that the Government had been providing a conducive policy environment for manufacturing and trading of medical devices.

The Indian medical devices industry has been scaling up production rapidly and could become a global powerhouse in the next few years, growing from its current market size of US$11 billion to $50 billion by 2025.

T S Bhasin, a former chairman of EEPC India and current chairman of the Committee on Trade with ASEAN countries, said COVID had motivated the industry to explore and adopt alternative ways of collaboration.

Given the rise in demand for medical equipment globally ranging from consumables and disposables to high-value engineering healthcare products and devices due to the pandemic, there was huge export potential for Indian suppliers, he said.

Medical device exports from India are projected to grow at a CAGR of 30 per cent to $10 billion by 2025 from $2.1 billion in 2020.

Viet Nam and other ASEAN nations could be major export markets.

Hua Phu Doan, vice chairman of the HCM City Medical Equipment Association, said: "It is predicted that the size of the Indian medical equipment market will reach $11 billion by 2022. There is potential breakthrough for economic and trade relations between Viet Nam and India.”

SP Group partners BCG Energy to grow renewable energy portfolio in Viet Nam

SP Group has signed a memorandum of understanding with BCG Energy Joint Stock Company, a wholly owned subsidiary of Bamboo Capital, that provides it exclusive rights to purchase 49 per cent of the latter’s subsidiary, Skylar Joint Stock Company.

Under the agreement, SP will acquire an initial 61.1 MW of rooftop solar assets from Skylar in 14 provinces across Viet Nam.

It will mark SP’s entry into Viet Nam’s renewable energy sector, a strategic growth market for it as it continues to expand its sustainable energy solutions footprint in the region.

The two sides will also jointly explore opportunities to invest and develop solar power projects to enhance Viet Nam’s electricity supply and support its ambitious goal of increasing the rate of electricity produced from renewables to 32 per cent by 2030 and 43 per cent by 2045.

Skylar specialises in rooftop solar and the installation of solar rooftop assets on factories and industrial parks.

BCG Energy is regarded as a pioneer in Viet Nam’s renewable energy industry. In recent years it has focused on researching into and implementing renewable energy projects to create an alternative supply.

It has been working closely with the world’s leading players in the solar industry on solutions, technologies, construction plans, environmental solutions, and analysis of local energy needs, thereby boldly making proposals to invest in large renewable energy plants in Viet Nam.

SP’s group chief executive officer, Stanley Huang, said: “This collaboration with BCG Energy will create a strong platform for us to support Viet Nam’s growing demand for electricity via a renewables-led path.

“Our track record in Singapore and China highlights our operational and technical expertise in sustainable energy projects that deliver on both business and environmental outcomes.

“We are confident this partnership with BCG Energy, a leader in renewable energy in Viet Nam, will offer operational synergies and innovation opportunities to advance Vietnam’s transition to low carbon energy and meet its sustainability ambitions.”

BCG Energy chief executive officer Pham Minh Tuan said: “Our aspiration is to build a leading renewable energy company in Viet Nam and Asia that will build significant market share in its fields. We believe that BCG Energy's cooperation with SP will contribute to promoting Viet Nam's energy industry to develop in a sustainable, environmentally friendly manner and enhance its ability to adapt to climate change.”BCG aims to develop 1.5 GW by 2023, including 500 MW rooftop solar focusing on industrial zones and manufacturing factories across Viet Nam. The new collaboration with SP Group will based on a win-win partnership and fasten up the company’s target pipeline.

In December last year SP established its Vietnam office in HCM city.

By extending its capabilities in sustainable energy and digital solutions, SP aims to create value-added solutions for its customers in Viet Nam and establish SP’s position as a leading sustainable energy solutions player in Asia Pacific.

SP Group is a leading utilities group in the Asia Pacific that seeks to enable a low-carbon, smart-energy future for its customers.

It owns and operates electricity and gas transmission and distribution businesses in Singapore and Australia, and sustainable energy solutions in Singapore and China.

As Singapore’s national grid operator, it benefits around 1.6 million industrial, commercial and residential customers with its world-class transmission, distribution and market support services.

These networks are among the most reliable and cost-effective anywhere in the world.

Beyond traditional utilities services, SP Group provides a suite of renewable and sustainable solutions including solar energy, microgrids, cooling and heating systems for business districts and residential townships, electric vehicle fast charging, and green digital energy management tools for customers in Singapore and the region.

BCG Energy is one of the pioneers in the renewable energy market in Viet Nam.

In recent years BCG Energy has focused on solar farms, solar rooftop and wind energy. It has successfully put into operation BCG-CME Long An 1 (49.6 MW) and BCG-CME Long An 2 (100.5 MW) solar power plants, VNECO Vinh Long solar farms (49.3 MW), Phu My Solar Power Plant (330 MW) and almost 50 MW of rooftop solar in Viet Nam.

In 2021 BCG Energy's revenues are expected to grow rapidly since it has added more than 453 MW of power to the grid.

In the near future BCG Energy will speed up solar energy projects, especially rooftop solar, in industrial zones.

Skylar JSC, its subsidiary, concentrates on rooftop solar, and is hailed by its partners for its ability to implement projects on schedule.

In 2020 it installed nearly 50 MW of rooftop solar in many provinces and cities across Viet Nam.

In 2021-22 it is expected to instal another 250 MW.

Five sub-projects of North-South Expressway to kick off construction this quarter

The construction of five sub-projects of the North-South Expressway will start in May and June. 

Notably, the construction of Dien Chau-Bai Vot sub-section (between Nghe An and Ha Tinh) will be started on May 22 under the public-private partnership (PPP) model.

On May 13, the Ministry of Transport and local joint-venture of Hoa Hiep-CIENCO4-Nui Hong Investment-Truong Son Investment-VINA2 Investment and Construction signed the build-operate-transfer (BOT) contract to develop the project.

The expressway Dien Chau-Bai Vot section has a total length of 50km and crosses the two provinces of Nghe An (44.4km) and Ha Tinh (4.9km). The project has total investment capital of VND11.15 trillion ($484.8 million), VND5.1 trillion ($221.74 million) of which come from contractors while the state will contribute VND6.06 trillion ($263.5 million).

The second section is Nha Trang-Cam Lam, which is expected to get off the ground next month. The section, located in Khanh Hoa province, has a total investment of over VND5.5 trillion ($239.13 million) including over VND2.5 trillion ($108.7 million) from the investor and over VND2.9 trillion ($126.1 million) from the state budget. The project will be implemented over two years and will have a payback period of about 16 years and four months.

The third one is the Cam Lam-Vinh Hao Highway, which is invested by the joint venture of Deo Ca Group, Hai Thach Investment Construction JSC, and 194 Construction Investment Corporation. The joint venture will use the BOT form to participate in the PPP project. The construction of this section is expected to start in June.

The two other sections, namely National Highway 45-Nghi Son and Nghi Son-Dien Chau, are also expected to start construction in June. The former will be developed by two joint ventures, including the joint venture of Cienco 4, Hoa Binh Construction Group, Thuan An Trading and Development Construction JSC, Newcity Group JSC, and 18 Transport Construction JSC.

The other joint venture includes Licogi 16, Dien Phuc Co., Ltd., FECON JSC, 468 Construction and Consultancy Investment JSC, and FECON Infrastructure JSC. The project is designed to have four lanes with the total investment capital of VND6.33 trillion ($275.2 million), VND2.03 trillion ($88.26 million) of which will come from the state budget.

The 50km-long Nghi Son-Dien Chau Expressway costs VND7.28 trillion ($316.5 million). It will run through Thanh Hoa and Nghe An provinces.

The North-South Expressway project comprises 11 sub-projects. Among them, six sub-projects invested by the state (Cao Bo-Mai Son, Mai Son-National Highway 45, Cam Lo-La Son, Vinh Hao-Phan Thiet, Phan Thiet-Dau Giay, and My Thuan 2 Bridge) have started construction.

SSI becomes first with market cap above $1 billion

As of April 19, SSI Securities became the first domestic securities firm securing a market capitalisation of over $1 billion.

SSI’s capitalisation is approximately twice as high as that of the second-ranked brokerage Viet Capital Securitas (VND12.2 trillion or $530.43 million).

Elsewhere, Ho Chi Minh Securities (HSC) and Saigon-Hanoi Securities (SHS) have market capitalisations of VND10.8 trillion ($469.57 million) and VND6.5 trillion ($282.6 million), respectively.

Since the beginning of 2021, the shares of some major securities companies have soared signficicantly, by 20-40 per cent, with some even nearly doubling.

In 2021, SSI expects to record VND5.263 trillion ($228.83 million) in revenue and VND1.870 trillion ($81.3 million) in pre-tax profit. This plan is equivalent to an on-year increase of 29 per cent in revenue and 20 per cent in pre-tax profit, respectively. This is also the most ambitious target among listed securities companies.

The next three peers, Viet Capital Securities, HSC, and VNDIRECT, set targets ranging from VND1.1 trillion ($47.83 million) to VND1.2 trillion ($52.17 million).

SSI’s ambitious target will remain in line with the company’s sustainable development plan, the company emphasised.

In terms of margin lending, SSI's outstanding loan by the end of the first quarter reached VND11.123 trillion ($483.6 million), lower than its equity, whilst some other competitors have approached the maximum level of twice their equity, according to Vietnamese regulations.

Last December, SSI inked a deal with a group of nine foreign banks led by the Union Bank of Taiwan for an unsecured loan worth $85 million.

A few days ago, the Ministry of Finance has just issued Circular No.30/2021/TT-BTC on extending the validity of Circular No.14/2020/TT-BTC dated March 18, 2020 amending and supplementing a number of articles of the Circular No.127/2018/TT-BTC dated December 27, 2018 on regulating service prices in the securities sector, applied at the Stock Exchange and Vietnam Securities Depository (VSD) to support relevant organisations and individuals impeded by the pandemic. The new Circular will take effect until December 31, 2021, from July 1.

Accordingly, companies will also enjoy free services for listing registration, securities registration, initial online connection, margin lending through the VSD, registration for derivatives market membership, and registration for trading settlement membership.

Based on the new charge cuts, securities firms, asset management companies, and investment funds will work to lower their charges to support the local market, which has been vulnerable due to the pandemic.

This fresh move, coupled with low interest rates and a variety of digitally-led trading platforms, will undoubtably boost the local stock market.

Vietnam posts US$530 million of trade surplus in auto accessories in Jan-Apr

Vietnam’s imports and exports of auto parts and accessories in the first four months of 2021 were US$1.67 billion and US$2.2 billion, respectively, leading to a trade surplus of some US$530 million.

Data of the General Department of Vietnam Customs showed that the country’s imports of auto parts and accessories from January to April rose 44.8% year-on-year to US$1.67 billion. In April alone, Vietnam imported US$452 million of these products, declining 8% month-on-month.

On the other hand, exports of auto parts and accessories in the first four months reached US$2.2 billion, rising 30% compared with the same period last year. Vietnam’s biggest importers were countries with developed automobile industries such as Japan, the United States, South Korea and Thailand.

The surging exports of auto parts and accessories were better than expected as many automakers in Vietnam have complained that the underdeveloped supporting industries in the country have reduced the competency of locally made autos against imported completely-built-up (CBU) ones.

The local input materials and components for coaches in Vietnam account for only 10-15% of the entire products, while that of Indonesia and Thailand amount to over 70%. According to automakers, the low localization rate has increased the prices of domestically made autos 15-20% higher than that of CBU autos imported from other Southeast Asian countries.

Some market observers said the country’s achievements in the production and export of auto parts and accessories mainly rely on foreign invested companies, especially those from Japan and Taiwan such as Furukawa, Okaya, Nagata, Sanyo Seisakusho, Pronics, Cobal Yamada, MTEX, FAPV, Nissei and Nidec Tosok.

These companies have invested in export processing zones in HCMC such as Tan Thuan and Linh Trung, from where they export their products to other markets around the world.

Vietnam has also attracted manufacturers from Germany and South Korea. For example, Bosch Powertrain Solutions’ factory in the southern province of Dong Nai is producing continuously variable transmission push belts for automakers in the Asia-Pacific and North America.

In 2020, Vietnam imported US$4.2 billion of auto parts and accessories and exported over US$5.6 billion of these products.

Some automakers said the country’s advantages include the high-quality human resources and low labor costs. However, the production of auto parts and accessories still relies on imported raw materials.

Transport Ministry assigned to order VNR to maintain railway infrastructure

The prime minister has assigned the Ministry of Transport to place orders with the Vietnam Railway Corporation (VNR) to manage and maintain the railway infrastructure facilities this year instead of assigning the job directly to VNR.

The Government leader on May 19 made the decision after consulting with relevant agencies. Accordingly, the ministry must sign a contract with VNR before May 24.

The Ministry of Transport has also asked the Vietnam Railway Authority to do the job and handed over the railway infrastructure maintenance fund for this year to the authority.

The prime minister’s decision put to an end the argument between the Ministry of Transport and VNR on the handling of some VND2.8 trillion for railway maintenance.

In previous years, the Ministry of Transport handed over the railway infrastructure maintenance fund to VNR as it is under the ministry’s management.

However, since 2019, VNR has been under the Commission for the Management of State Capital at Enterprises, so the ministry did not hand over the fund to VNR as it went against the Law on State Budget.

Therefore, the ministry proposed handing over the fund to the Vietnam Railway Authority and the authority would have to sign maintenance contracts with 20 subsidiaries of VNR.

VNR Chairman Vu Anh Minh said the ministry’s proposal was unreasonable as the unity of railway infrastructure management and maintenance and the safety of trains would be at risk.

In addition, if the fund was assigned to the authority, its allocation might be slower, leading to the slow payment of salaries for hundreds of laborers. Therefore, VNR proposed directly receiving the fund.

Source: VNA/VNS/VOV/VIR/SGT/Nhan Dan/Hanoitimes

VIETNAM BUSINESS NEWS MAY 23

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