Diversified conglomerate Imex Pan Pacific Group (IPP) of dollar billionaire Johnathan Hạnh Nguyễn wants to invest in Bắc Vân Phong, pledging to attract US$40 billion investment to turn the region into a modern economic zone.

Speaking at a working session on Tuesday with the People’s Committee of Khánh Hòa Province, Nguyễn said that IPP had studied the region for two years and wished to invest in Bắc Vân Phong which was located in Vạn Ninh District to develop it into a modern and original economic zone.

He said that IPP pledged to attract around $40 billion into the region. The sum would not entirely come from IPP, but the company would also call for investment from other big foreign investors, depending on their sectors of strength.

Nguyễn, who was born in Ninh Hòa, Khánh Hòa, also wished to pay all the costs of planning for Bắc Vân Phong, estimated at around VNĐ68 billion ($3 million) and give the planning to the province as a gift when completed.

IPP proposed the province to consider hiring KPMG Group from the Republic of Korea to complete the planning for the region.

KPMG had plans for Bắc Vân Phong Economic Zone, including a casino, golf courses, non-tariff area, logistics centre, tourism complex and hi-tech industrial and residential zones with a modern and developed infrastructure system.

Nguyễn Tấn Tuân, chairman of the provincial People’s Committee, said that Bắc Vân Phong would focus on industrial development but at the same time must promote tourism and protect the environment.

Tuân said that the province would consider IPP’s proposal for the signing of a memorandum of understanding.

The Government in October 2017 proposed a draft law on special administrative economic zones for Bắc Vân Phong, Vân Đồn (Quảng Ninh) and Phú Quốc (Kiên Giang) to the National Assembly. In June 2018, the National Assembly delayed the vote for approval of the draft law because the draft law needed to be given more consideration, especially incentive policies for investors.

Pig breeding firms report surge in profit

Many large pig breeding farms in the country have reported a surge in profits in the first months of the year thanks to high prices due to a supply shortage.

Bắc Ninh-based Dabaco Group has reported its highest-ever profit growth in the first quarter of VNĐ348.7 billion (US$14.9 million), 17 times higher than the same period last year, on revenue of VNĐ 2.38 trillion ($102.15 million), a year-on-year increase of 41 per cent.

The African swine fever outbreak caused the pork shortage in the domestic market, resulting in high pork price for a long period.

Its five-month after-tax profit was worth nearly VNĐ593 billion ($25.5 million), 30 per cent higher than the target for the year.

This year, Dabaco targets achieving over VNĐ13.2 trillion in revenue and nearly VNĐ460 billion profit after tax, an increase of 84 per cent and 51 per cent, respectively.

With good profit prospects this year, it plans to pay dividends at 25 per cent, of which 15 per cent will be paid in cash and 10 per cent in shares.

Đồng Nai Agricultural Livestock Products JSC (Dolico) reported a pre-tax profit of VNĐ39 billion ($1.67 million) in the first quarter, or 141 per cent higher than its target.

In the second quarter, Dolico aims to produce 855 tonnes of pork, and achieve a total revenue of about VNĐ65 billion ($2.79 million) and profit before tax of VNĐ15 billion ($644,333).

Similarly, VISSAN JSC also enjoyed good profits from pig raising activity.

The company's net revenue in the first quarter increased by nearly 21 per cent over the same period, reaching more than VNĐ1.45  trillion ($62.2 million). Of the figure, the revenue from fresh meat accounted for nearly VNĐ669 billion, revenue from processed food is about VNĐ742 billion.

Its profit in the first quarter was up by nearly 20 per cent over the same period last year to nearly VNĐ47 billion ($2.02 million).

Vissan has focused on two main segments: fresh food and processed food. Its slaughtering capacity is about 2,400 pigs and 300 Australian cows a day.

The price of pork has steadily increased from the end of last year and hit a 20-year high of VNĐ103,000 ($4.4) per kilogram last month despite efforts to pull down prices from authorised agencies.

Nguyễn Như So, Dabaco’s chairman, said total domestic pig herds could only return to the figure before the African swine fever by the end of this year.

Total pig herds at Dabaco are expected to increase by 15 per cent this year over last year, making it the Vietnamese firm with the largest pig herd in the country, he said.

To contain prices in the domestic market, in addition to encouraging more pig breeding, authorities have been increasing meat imports from Canada, the US, Russia and Germany, and have allowed for the first time the import of live pigs from some countries.

However, with the current market situation, So said until the end of 2020, pork would not return to cheap prices as before. The pork price in the world market would be as expensive as in Việt Nam.

"No country has prepared enough food before the pandemic and has enough (pork) to export," So said. 

Vietnamese lychees to be promoted in Australia

Activities to promote Vietnamese lychees will be carried out in Australia following the export of nine tonnes of the fruit to the country.

A batch of nine tonnes of red lychees is scheduled to arrive in Australia on June 12, marking the first export of Vietnamese lychees to the country reported the Vietnamese trade office in Australia.   

Red lychee has good quality and is early ripening with a firm skin, so, it is suitable for being transported for a long distance.

The Vietnamese trade office in Australia will launch a promotion campaign on the two types of lychee based on their colour.

The Vietnamese trade office will invite potential importers, store owners and customers to test the newly imported fruit right after being exported to Australia. The agency will set up billboards in crowded areas to advertise fresh lychees. The advertisement will be implemented through Facebook. A contest aimed at introducing Vietnamese lychees has also been planned.

The trade office will pay attention to getting feedback from consumers to help develop a distribution network for the fruit in Australia.

The Vietnamese lychee marketing programme will be held in different localities in the coming time.

EVFTA could turn Vietnam into new destination for manufacturers: Nikkei

Business publication Nikkei Asian Review of Japan has recently released an article, affirming the Vietnam National Assembly’s ratification of the European Union-Vietnam Free Trade Agreement (EVFTA) is expected to transform Vietnam into a fresh investment destination for manufacturers looking for alternatives to China.

The article reports that by ratifying the EVFTA Vietnam is the second country in Southeast Asia to enjoy a trade deal with the European bloc, alongside Singapore.

Once the agreement comes into force scheduled for August 2020, a total of 71% of exports from the country to the EU will become duty-free, so will 65% of EU shipments to Vietnam. Furthermore, up to 99% of tariffs will be phased out by Hanoi over the course of the subsequent 10 years, and by Brussels over the next seven years.

With a population of approximately 96 million, Vietnam boasts the third-largest population among the 10-member Association of Southeast Asian Nations. Moreover, its per capita GDP is estimated to be roughly US$3,500 for 2019, topping the $3,000 benchmark that usually sees car and appliance ownerships take off.

The article points out that Hanoi already enjoys plenty of benefits from the EU's preferential tariff scheme, adding that the trade deal will surely make the bloc a bigger buyer of Vietnamese goods, therefore increasing its current share of some 15%.

According to the article, strong growth is anticipated for the apparel and footwear sector, which accounts for roughly 20% of all Vietnamese exports with the country emerging as the world's third-largest apparel exporter following China and Bangladesh.

In addition, local textile companies are gearing up to enter the EU market. Once the deal comes into full effect, the bloc will eliminate tariffs on 77.3% of all textile and apparel exports from Vietnam over the course of the subsequent five years, while removing the remaining 22.7% in the following seven-year period.

Most notably, many local companies operating in the sector claim that their contracts with partners in the EU and the United States have been canceled, delayed, or scaled down in recent months. Indeed, the country’s garment industry reported that all enterprises have been affected by the pandemic, noting that 70% of the members were urged to cut labour force in March, with greater reductions in April and May.

Hopes are therefore growing that the trade deal will provide a much-needed boost to the national economy, which is certain to suffer a slowdown from the 7% growth experienced before the novel coronavirus pandemic. Due to the current global COVID-19 crisis, this year’s target in terms of garment export turnover is US$34 billion, down from US$39 billion last year.

The article emphasises that the EVFTA represents positive news for multinational manufacturers outside of the EU as well. Among Japanese enterprises, apparel companies such as Uniqlo operator Fast Retailing and automakers are seeking to increase shipments from Vietnam to Europe.

The Japanese news publication quotes data from the Vietnamese Government, as saying Hanoi's exports to the EU market reached US$42 billion in 2019, while the bloc's shipments to the country totaled US$15 billion. It says there are high hopes from the Vietnamese side on what benefits the agreement can bring.

The Ministry of Planning and Investment therefore expects national export revenue to the EU to enjoy a rise of 42.7% by 2025, in addition to a boost of 44.37% by 2030 in comparison with the no-deal scenario.

The World Bank projects that the agreement will help to boost Vietnam's GDP by 2.4% and increase exports by 12% by 2030. Tran Tuan Anh, Vietnam’s Minister of Industry and Trade, has said the agreement will speed up the reduction of poverty nationwide.

Most notably, the UK, which is completing the Brexit process, will remain part of the EU trade pact with Vietnam until the end of 2020. UK ambassador to Vietnam Gareth Ward told British companies in a recent online conference that both the UK and Vietnam are working on a bilateral trade deal, with an agreement expected to be reached by the end of the year.

In addition, the country is also part of a free trade partnership known as the Regional Comprehensive Economic Partnership (RCEP), which includes all of Southeast Asia, as well as Australia, China, India, Japan, New Zealand, and the Republic of Korea. Elsewhere, the nation is also seeking a trade deal with Israel, whilst local companies are urging it to begin negotiating an FTA with the US as soon as possible.

Fruit exports to EU urged to obey origin traceability rules

With the European Union –Vietnam Free Trade Agreement (EVFTA) taking effect in coming weeks, local businesses are advised to follow rules on origin traceability to seize upon the opportunities brought about by accessing the EU market, according to insiders.

At present, the EU makes up the fourth largest export market for Vietnamese fruit and vegetable products, following China, the United States, and Japan. Once the EVFTA takes effect slated for August 1, the exemption of import duties when goods enter the EU market will make a significant contribution to enhancing the competitiveness that Vietnamese fruits enjoy in comparison with items from other countries.

Despite these benefits, Vietnamese enterprises remain afraid of entering the EU market due to technical barriers and stringent regulations on products that use pesticide residue and other banned substances set by EU importers.

Dang Phuc Nguyen, General Secretary of the Vietnam Fruit and Vegetables Association, noted that firms must strictly obey the high standards set by the EU with regard to food safety. This includes the limited use of pesticide residue to avoid having items returned, therefore having a negative impact on the country’s fruit and vegetable industry.

Nguyen emphasised that origin traceability will be a mandatory requirement for fresh fruit and vegetable importers, adding that EU enterprises will require all fruit exporters to fully obey rules relating to origin traceability.

Filip Graovac, Deputy Country Representative at the Asia Foundation, pointed out that Vietnamese firms have yet to apply the rules on origin traceability of goods in an effective manner, although they are making efforts to expand very well.

He underscored the importance of new-generation FTAs such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership(CPTPP)  and the EVFTA, both of which present a wealth of opportunities for local firms to expand into new markets. This is particularly true in the current context of the country emerging as a safe destination after the novel coronavirus has been brought under control.

Graovac noted that Vietnam has great potential for exporting high-quality agricultural products as well as having responsible producers, but the crux of the matter is that those advantages should be introduced to importers.

To equip domestic businesses with such knowledge, the Australian Government has funded a project aimed at boosting the traceability of goods and developing exports. The two-year project which began in 2020 is believed to benefit processors of coffee, peppers, mangoes, ceramics, and rattan products.

The results of the project are set to be replicated to 13 key agricultural export items and many other products nationwide under the "One Product One Commune" scheme.

Nguyen Dinh Tung, General Director of Vina T&T Group, stated that alongside the support of the Government, there should be concerted efforts made by enterprises and co-operatives to comply with the transparency of information and origin traceability relating to products.

He noted that along with the Hazard Analysis and Critical Control Points and the Global Partnership for Good Agricultural Practice standards, local firms have been advised to gain greater insights into new provisions under the EVFTA including those on social welfare for workers and environmental protection, in order to successfully penetrate the demanding EU market.

Localities promote summer agricultural products

The Ministry of Agriculture and Rural Development and local officials are helping northern farmers and businesses find outlets for their agricultural products in domestic and foreign markets.

Hai Duong province organized a fair in Hanoi this week at which 100 booths are selling Thanh Ha lychees and other safe agricultural products. 

The Hai Phong supermarket Co.opmart is holding a Week of Safe Agricultural Products and a promotion of Son La tourism in collaboration with 25 businesses and cooperatives from Hai Phong and Son La province.

Dinh Thi Yen, Director of the Thai Tuan Cooperative in Sơn La province, said “Our products meet Son La province’s 4-star standard. Our business was badly hurt by the Covid-19 epidemic. There should be more trade promotions like this so our products can reach more customers.”

The Vietnamese Ministry of Industry and Trade and China’s International Trade Promotion Committee in Yunnan province co-organized an online trade conference for Vietnamese and Chinese businesses to market their agricultural and aquaculture products, beverages, and processed food.

A Vietnam-Singapore online trade conference in May focused on promoting lychees from Bac Giang province, preservation and transportation solutions, and export opportunities to Singapore.

Deputy Minister of Agriculture and Rural Development Le Quoc Doanh said a specific development plan is needed for each kind of agricultural product in the northern region.

“The Ministry of Agriculture and Rural Development, Son La province, and other northern mountain provinces are working on a general development plan for fruit trees in the region. The Ministry will develop projects for groups of fruits in the region to balance supply and demand. There needs to be close collaboration by businesses to create production chains that meet production, quality, and distribution standards”, Mr Doanh added. 

Hanoi has organized events to help other cities and provinces sell their products now that the COVID-19 epidemic is under control. In the third and fourth quarter, Hanoi will host inter-provincial business exchanges, fruit and agricultural product weeks, and conferences to coordinate supply and demand.

EU media: EVFTA will give Vietnam economic boost amid COVID-19

The implementation of the European Union-Vietnam Free Trade Agreement (EVFTA) is expected to provide a window of opportunity for firms to do business and goods to be traded between the country and the EU amid the novel coronavirus (COVID-19) pandemic, according to several European media outlets.

Prestigious news publication Reuters of the UK has recently published an article outlining the nation’s benefits brought about by the EVFTA when it officially comes into force, noting that the trade pact will serve to eliminate 99% of tariffs placed on goods traded between the country and the bloc, whilst also providing the nation with a much-needed post-pandemic boost. 

Reuters noted that the trade deal will serve to open up many Vietnamese services, including postal, banking, shipping, and public procurement markets, whilst protecting the import of EU food and drink products, such as French champagne or Greek feta cheese, from imitations in the Vietnamese market.

The article quoted statistics from the World Bank, saying that the EVFTA could boost the nation’s gross domestic product and exports by 2.4% and 12% by 2030, respectively, whilst also serving to lift hundreds of thousands of people out of poverty.

“Such benefits are particularly urgent to lock in positive economic gains as the country responds to the COVID-19 pandemic,” the World Bank said.

Supporting this viewpoint, Pier Giorgio Aliberti, head of the delegation of the European Union to Vietnam, spoke highly of the Vietnamese side’s active participation in global value chains, which will therefore create opportunities to promote the benefits of diversifying trade relations following the conclusion of the COVID-19 pandemic.

The EVFTA will be able to contribute to accelerating economic growth and trade activities between both sides as Vietnamese people will now be able to purchase higher quality products from the EU at an affordable price, according to Aliberti. Indeed, Vietnamese firms have been given the chance to make inroads into the EU market by promoting high standards along with a huge purchasing power.

Analysing the benefits of the impending trade deal, Cecilia Malmstrom, former EU Trade Commissioner, recommended that EU financiers boost investment in the Vietnamese market, adding that the EU’s current level of investment remains modest.

Malmstrom expressed her belief that more comprehensive protection for investors of both sides will lead to the EU’s investment in the nation increasing significantly.

Due to the COVID-19 pandemic greatly affecting many countries globally, the EVFTA enforcement will be of great significance as it can help to accelerate economic recovery, whilst mapping out orientations for the shift in production and supply chain in both a sustainable and balanced manner for EU member states and for Vietnam.

German news publication DW also ran an article on the EVFTA, affirming that it is the EU's most ambitious trade deal with a developing country to date, whilst it will also give the Southeast Asian country a much-needed economic boost amid the COVID-19 pandemic.

Vietnam represents one of the world's fastest-growing economies and the EU's second-largest trading partner in Southeast Asia after Singapore, according to the prestigious DW news website.

The article quoted Vietnamese economist Pham Chi Lan as saying that the implementation of the deal, "can't come at a better time for Vietnam when it's on the path of economic recovery after several months of closure due to COVID-19.”

Reduced purchasing power anticipated to negatively impact economic growth

Economic experts have warned that heavily reduced purchasing power, in addition to numerous difficulties faced in production and business activities, are likely to have a serious impact on the overall state of the enterprise system.

Low purchasing power is greatly affecting production, business, and overall economic growth
According to figures released by the Ministry of Planning and Investment, despite total retail sales of consumer goods and services prospering in May with a 26.9% rise from the previous month, they still dropped 4.8% compared to the same period from last year. 

Following the index of total retail sales, the growth rate of the industrial production index stood at only 1%, a figure in contrast to the 9.5% increase seen during the corresponding period in 2019. This therefore personifies the plummeting purchasing power of both domestic and export markets.

Economic experts have therefore raised concerns over the figures amid the current economic context due to low purchasing power greatly affecting production, business, and overall economic growth.

Therefore, as a means of promoting economic development, one effective solution currently is to stimulate demand domestically. Indeed, the size of the local market is viewed as a fulcrum which can help businesses maintain production and eventually overcome the effects of the pandemic.

Over the long term, the growth of the domestic market will provide a boost to the production of local goods as they develop in a strong and highly competitive manner, therefore serving domestic consumption and exports. It is hoped that this boost will simultaneously make an important contribution to the nation’s socio-economic development for the duration of the year and in subsequent years moving forward.

According to the World Bank, at present approximately 15% of the country’s population are part of the global middle class. In line with the current growth rate, 1 million more Vietnamese citizens will join this group each year. It is anticipated that the emerging middle class will consume a greater number of products and services with a better quality, therefore requiring domestic businesses to improve their capacity through efficient and innovative use of resources.

Other experts note that the domestic market can be considered a "savior" for many local firms and to the national economy, therefore it is a necessity to devise solutions aimed at stimulating domestic consumption and supporting local enterprises through production, business, and retail.

Indeed, Can Van Luc, an economic expert, said that in the current difficult conditions, an important task for the immediate future is to push ahead with ensuring effective disease prevention and control, in addition to stimulating domestic production and consumption.

During a recent regular cabinet meeting, Prime Minister Nguyen Xuan Phuc emphasised that in order to recover the economy following the epidemic, it remains imperative to boost domestic market demand with regard to personal consumption, trade, and services.

Commenting on the direction taken by PM Phuc, businesses believe that promoting economic recovery whilst stimulating supply and demand within the domestic market remains the best way to boost growth in the context of the global epidemic situation remaining complicated with unpredictable developments ahead.

Rice export price begins to decline following record high

The rice export price has seen a decrease of between 7% and 8% in recent days after previously hitting their highest level over the course of the past ten years.

Most notably, the majority of rice export businesses based in the Mekong Delta enjoyed selling rice at a high price last week. 

Indeed, Cai Be district in the Mekong Delta province of Tien Giang saw firms sell fragrant rice to foreign markets at between US$480 and US$640 per tonne, the highest level recorded over the past ten years.

This decline in the rice export price in recent days can be attributed to both China and the Philippines moving to temporarily suspend the import of rice.

At present, several rice businesses located in Tien Giang province still have a large inventory of rice leftover from their winter-spring crop.

Nguyen Van Don, director of Viet Hung Co., Ltd. in Hau Thanh commune of Cai Be district, said his company has exported approximately 50,000 tonnes of rice, reaching 50% of the year’s total export plan.

Currently, the firm has an inventory of over 10,000 tonnes of rice that remains from the winter-spring crop.

Indeed, rice had been sold at high prices in markets such as Hong Kong (China) and China, although they have now fulfilled their quota. Meanwhile, the Philippines has stopped importing rice and is now awaiting direction from the Government, according to Don, adding that rice from the summer-autumn crop has yet to be sold.

Pathway for local businesses to benefit from EU trade deals

With both the European Union-Vietnam Free Trade Agreement (EVFTA) and the European Union-Vietnam Investment Protection Agreement (EVIPA) being adopted by the Vietnam National Assembly, many local firms have pinned their hopes on capitalising on the opportunity to expand into a new export market and develop production.

Tran Thanh Trong, general director of Sang Ban Mai Joint Stock Company located in Ben Cat town of Binh Duong province, expressed his elation at the adoption of the two trade deals by the legislature. 

“We expect that when the agreements come into effect, Vietnamese businesses will be able to have easier access to European technology and equipment at a lower cost than currently, while the import tax rate will be lower than the current one, making it easier for enterprises to boost their exports to the EU,” Trong said.

According to Tim Evans, CEO of HSBC Vietnam, the EU currently makes up the country’s second largest export market, with the start of the EVFTA meaning the beginning of a process to eliminate 99% of tariffs placed on goods. Once the trade deal comes into force, two-thirds of tariffs on EU exports will be immediately lifted, while about 71% of tariffs on Vietnamese goods exported to Europe will also be abolished right away, with the rest being eliminated in line with a seven to ten year roadmap.

As a result of these benefits, the EVFTA is anticipated to bring enormous growth to the national economy with an expectation that it will contribute an average of 0.1% to real GDP growth annually through the positive impact to trade. Most notably, sectors such as garments and textiles, along with footwear, are set to benefit the most as the tax imposed on these industries before the agreement comes into effect are at high levels.

The EVFTA will therefore offer a breakthrough opportunity to the country’s textile and apparel industry to enjoy a greater competitive advantage and compete equally in price with countries that also enjoy a tax rate of 0% in the EU market.

Furthermore, once the EVFTA comes into force, Vietnamese textiles and garments that take advantage of the Generalized System of Preferences scheme will continue to enjoy it for a full two years afterwards.

Truong Van Cam, Vice Chairman of Vietnam Textile and Apparel Association, said he hopes that the EVFTA will offer breakthrough opportunities for local sectors, including garments and textiles, especially following the impact of the novel coronavirus epidemic which has caused numerous challenges for the textile industry.

Elsewhere, as an enterprise specialising in exporting goods to the EU market, Tran Van Dung, general director of Seafood Import Export Processing Joint Stock Company in Ba Ria - Vung Tau province, shared that the approval of the EVFTA will help domestic enterprises enjoy plenty of benefits with import tax placed on items from the EU market being reduced. This will ultimately serve to facilitate the selling of potential items such as agricultural and seafood products locally.

Moreover, some wood product exporting firms based in Ho Chi Minh City said that they are set to bolster the export of goods with opportunities to increase their market share in Europe through things such as industrial boards, MDF boards, fine arts, and handicraft.

Nguyen Chanh Phuong, Vice Chairman of the Ho Chi Minh City Handicraft and Wood Processing Association, said that businesses will have the opportunity to buy good quality wood processing materials, both when importing and exporting from Europe. They will be able to enjoy cheaper prices due to reduced import duties, therefore helping to improve the quality of Vietnamese processed wood products. In addition, wood processing businesses also have the chance to replace their supply chain of raw materials, instead of relying on those imported from China.

"High-quality raw materials imported from Europe, which were previously imposed with high tax rates of 10% to 25%, are now lower so we have to take this opportunity to access sources of high-quality raw materials and auxiliary materials with decreased prices due to the reduction of taxes," Phuong shared.

There are great hopes that the approval of both the EVFTA and EVIPA will open up plenty of opportunities for Vietnamese enterprises to boost exports to Europe, however the trade deals also pose many challenges. In order to take advantage of these fresh benefits, local firms must carefully study specific regulations regarding each commodity, whilst improving the quality of products and services in an effort to ensure the supply of goods in addition to meeting the rigorous requirements of markets in developed countries. 

PVOIL targets profit up 8 per cent this year

PetroVietnam Oil Corporation (PVOIL) hopes to achieve a post-tax profit of VND376 billion (US$16.2 million) this year, up 8 per cent year-on-year.

The information was released at the annual general meeting of shareholders held on Monday in HCM City.

At the meeting, PVOIL said this year’s revenue is estimated to reach 65 per cent of last year’s figure. Revenue and profit results were calculated based on crude oil’s price of $60 per barrel.

PVOIL General Director Cao Hoai Duong told the meeting that April output had plunged by 18 per cent compared to the initial plan due to social distancing orders and declining demand for petrol amidst the COVID-19 pandemic.

Output had shown signs of recovery in May after the easing of social distancing but was still 7 per cent lower than the initial plan, Duong said.

As of the end of the second quarter, PVOIL’s output had slumped by 12 per cent, he said.

PVOIL forecast two growth scenarios for this year.

In the first scenario with the COVID-19 disease successfully contained, the output will decrease by 8-10 per cent.

In a more negative scenario, if there is a second wave of infections, PVOIL’s output will drop by 18 per cent.

PVOIL achieved consolidated revenue of VND80.3 trillion last year, 164 per cent of the year's plan. Post-tax profit touched VND347 billion, 99 per cent of the yearly plan.

The company contributed VND11.6 trillion to the State budget, up 63 per cent compared to 2019.

PVOIL provided crude oil for the operation Dung Quat Oil Refinery in the central province of Quang Ngai and guaranteed the supply of E5 RON92 biofuel. 

Co-operative forum to be held in Q3

Deputy Prime Minister Trinh Dinh Dung approved the Ministry of Planning and Investment’s plan of organising the cooperative forum in the third quarter of this year.

The forum aimed to create a platform for cooperatives to speak about problems and difficulties, to share experiences and to propose policies to the Government.

With the theme “Cooperation for development”, the forum would discuss measures to develop the collective economy through promoting links among cooperatives and with other business models in the context of Industry 4.0.

The forum was expected to attract about 500 delegates.

On the sidelines, there would be an exhibition to display products of cooperatives.

According to the Ministry of Planning and Investment, the collective economy contributed around four per cent to the country’s gross domestic product.

To date, there are 22,861 cooperatives in operation in Viet Nam, including 13,856 agricultural cooperatives, 1,183 people’s credit funds and 7,822 non-agricultural cooperatives, which altogether attracted six million members.

The annual average revenue of cooperatives was VND4.4 billion (US$189,600) in 2018, 5.2 times higher than 2003. Average profit also increased from VND74 million in 2003 to VND240.5 million in 2018.

There were 74 unions of cooperatives, 39 of which were operating in agriculture. The unions of cooperatives attracted 375 member cooperatives and created jobs for 25,200 labours. The unions of cooperatives had average revenue of VND994 million per year and profit of VND148 million.

Cooperatives and unions of cooperatives provided jobs for two million labourers.

Besides, there were 101,400 cooperative groups with 1.34 million members. 

Pork prices continue to be closely monitored

For months, pork has become a hot spot due to its high prices. To ensure supply and demand, and stabilize the price, on May 27, the Ministry of Agriculture and Rural Development (MARD) gave nods to imports of live pigs to meet the demand for fresh pork of Vietnamese people. 

Many experts said that this was only a temporary solution. Basically, the Government and ministries need to have effective mechanisms and policies to encourage pig repopulation, increasing pig supply to compensate for the gap caused by the African swine fever epidemic.

On April 1, the price of pigs in Ho Chi Minh City and neighboring provinces and cities fluctuated at VND70,000-VND73,000 per kilogram, down VND10,000 per kilogram compared to that on March 1. However, on May 1, the price of pigs rose to VND86,000-VND89,000 per kilogram, up VND16,000 per kilogram compared to that on April 1, lower than the price of pigs in the North by VND4,000-VND6,000 per kilogram.

On May 15, the price of pigs continued to climb to VND90,000-VND93,000 per kilogram and now is at VND95,000-VND98,000 per kilogram.

In comparison with the same period last year, the current price of pigs is three times higher. Compared to the average price of pigs last year, the current price of pigs has doubled. The price of pigs also pushed the prices of pork to go up. At the Hoc Mon Wholesale Market, the price of pork cuts on June 8 and 9 was at an average of VND110,000 per kilogram, down VND5,000 per kilogram compared to June 1.

Noticeably, although the amount of pork arrived at wholesale markets in Ho Chi Minh City dropped drastically, according to Mr. Le Van Tien, Deputy Director of Hoc Mon Market Management and Trading Company, pork supply still met demand, so there was no shortage of pork. The main reason is that high prices of pork have caused the demand for pork to fall steeply. Many collective kitchens as well as citizens have shifted to use other foods, such as beef, chicken, and fish to replace pork.

The report of the Department of Industry and Trade of Ho Chi Minh City showed that the total pork consumption in the market in April this year decreased by about 40 percent compared to March this year, due to the social distancing order. In May, pork consumption slightly recovered but still dropped by 25 percent compared to March. Of which, the purchasing power increased faster in modern distribution channels than traditional market channels.

Ms. Nguyen Huynh Trang, Deputy Director of the Department of Industry and Trade of Ho Chi Minh City, said that authorities have drastically implemented measures to stabilize the prices of pork since early- April this year.

Along with measures to prevent speculation, profiteering, manipulation, and unreasonable overcharging; strengthen inspection, control the market, and prevent transportation and trading of pigs and pork with the unclear origin; authorities also guide provinces to promptly repopulate pig herds in a sustainable direction, and raise pigs in a closed and biosecurity model.

In Ho Chi Minh City, up to now, pork is still included in the list of market stabilization products. Specifically, enterprises participating in the market stabilization program continue to supply pork at the price announced by the Department of Finance, and ensure the output following the city’s plan, at the same time, run many promotional campaigns and offer discounts.

The amount of market-stabilized goods provided to the market was 4,700 tons per month. The prices of pork have been kept unchanged since January 1. Of which, the price of ham is at VND140,000 per kilogram, the price of pork shoulder is at VND139,000 per kilogram, the price of loin steak is at VND138,000 per kilogram, the price of pork ribs is at VND145,000 per kilogram, the price of peg joint at VND128,000 per kilogram, the price of pork armpit is at VND134,000 per kilogram, the price of pork fillet (shoulder and ham) is at VND161,000 per kilogram, the price of pork belly is at VND179,000 per kilogram, the price of pork tail is at VND115,000 per kilogram, and the price of pork bones is at VND70,000 per kilogram.

The price-stabilized pork is distributed at stores in the price stabilization program. Consumers can go to large distribution networks to buy pork with high quality and reasonable prices, including Co.opmart, Co.op Food, Aeon Citimart, BigC, Lotte, and Satrafood.

According to Ms. Nguyen Huynh Trang, the Department of Industry and Trade continues to closely monitor the market of pork and alternative foods such as poultry, seafood, and vegetables. The city will continue to encourage enterprises to increase pork imports and stimulate the frozen pork market, through propaganda, encouraging consumers to use frozen meat, increasing the supply of frozen meat for the processing of ready-made foods and processed foods.

Five-month overseas remittances to HCMC touch US$2.3 billion

The State Bank of Vietnam – Ho Chi Minh City Branch said that by the beginning of June this year, overseas remittances transferred to the city reached US$2.3 billion, a decrease of 1.9 percent over the same period last year.

Last year, the total overseas remittances to HCMC hit $5.3 billion. Due to the impacts of the Covid-19 pandemic, it is forecasted that overseas remittances to the city will be lower this year.

Money transfer companies in the city said that overseas remittances in the first two quarters of this year dropped significantly, especially from labor export markets, namely Japan, Taiwan (China), and South Korea, and traditional markets, including the US, the UK, Canada, and Australia.

The World Bank also forecasted that the global remittances will decline by 20 percent because of the Covid-19 pandemic, of which, the East Asia and Pacific region will experience a reduction of 13 percent.

F88 receives VND140 billion from two foreign investors

F88, a company active in the secured consumer lending market, on June 9 announced to close its third growth investment round, raising approximately VND140 billion from Mekong Enterprise Fund III (consulted by Mekong Capital) and Granite Oak at a valuation of VND2,100 billion as of late 2019.

Phung Anh Tuan, chairman and CEO of F88, said the new investment would help his company continue to expand quickly and accelerate the lending growth at its existing 180 branches

F88 is well established in Vietnam’s debt capital markets and has strong relationships with local investment banks and financial institutions. Since 2019, the company has successfully issued over VND200 billion (over US$8.5 million) of corporate bonds.

Apart from offering secured lending services, F88 also provides other financial services such as distributing life and non-life insurance, bill payment and mobile money.

Government’s regulatory support boosts wind power development

Stronger regulatory support from the Government including several policies in recent months to boost the development of the wind power sector, especially offshore wind, as well as rising investor interest have provided the shot in the arm that Vietnam’s wind energy sector needs, according to Fitch Solutions.

The Prime Minister issued a resolution in March 2020 over a five-year plan to develop renewable energy sources off the coast, with specific mechanisms and policies to attract both foreign and local developers to invest in the sector.

The offshore wind sector was also emphasized in the National Energy Development Strategy of Vietnam until 2030, and the Government is in the process of amending the seabed lease and licensing requirements for large-scale offshore wind farms alongside the Ministry of Natural Resources and Environment.

The Ministry of Industry and Trade has proposed including several wind projects in the upcoming Power Development Plan and extending the feed-in-tariff deadlines for wind power projects by two years until 2023, from the original commercial operation date deadline in November 2021.

This extension aims to support investors, whose wind power projects have been postponed and will not be completed on time due to the negative impacts of Covid-19, including supply chain disruptions, labor shortages and suspended construction.

Fitch Solutions expects the Government to announce a new Power Development Plan this month with renewable energy and a special focus on wind power.

According to the Netherlands Enterprise Agency, Vietnam is considered to have the best wind resources in Southeast Asia, especially in coastal regions in the south. In these areas, the yearly average wind speeds are measured at 9 to 10 meters per second.

Binh Thuan Province in the south-central coastal region and Tra Vinh, Bac Lieu and Soc Trang provinces in the southern coastal region have the highest potential for wind power.

Due to both rapid industrialization and remarkable economic growth, the demand for electricity in Vietnam is annually increasing at 10%. The Vietnamese Government has formulated ambitious goals for renewable energy, especially wind energy, which is presented as an important renewable energy source for the future.

According to data from the Ministry of Industry and Trade, there are currently 11 wind power projects operational in the country, with a total capacity of 377 megawatts (MW), and over 31 projects with a total capacity of 1,660 MW are scheduled for operation in 2020 or 2021.

Capacity targets for the country’s wind energy sector are expected to increase to 6GW by 2025 and 10GW by 2030 from the existing 2GW and 6GW, respectively. The Government is also looking to introduce a new Direct Power Purchase Agreement, where renewable energy producers can sell and deliver electricity directly to corporate customers.

“We believe these developments will encourage further growth and investment in the sector. We have already seen growing investor interest across Vietnam’s wind sector over the past year, which has strengthened the pipeline significantly,” concluded Fitch Solutions experts.