BUSINESS NEWS HEADLINES MARCH 3

Vietnamese banks see improved solvency

Vietnamese banks' capitalisation and asset quality would stay at current levels in 2020. — Photo Techcombank

Banks in Viet Nam posted solid profit growth and asset quality improvements in 2019, benefitting from the country's robust macro-economic environment, Moody's Investors Service said.

Under a new report released on Monday, the international rating agency said solvency improvements of the banks have peaked.

The agency predicted that the banks’ capitalisation and asset quality would stay at current levels in 2020. Improvements in profitability will slow overall, as competition drives up funding costs

"For 2020, capitalisation will broadly stabilise, as assets grow at a similar pace to the rate of internal capital generation," says Rebaca Tan, a Moody's Assistant Vice President and Analyst. "As for asset quality, any improvements will be limited."

Moody's points out that downside risks to asset quality can arise from disruptions caused by the coronavirus outbreak, which, if prolonged, will lead to increases in non-performing loans in the manufacturing, trade and other sectors, given Viet Nam's large exposure and close ties to global supply chains.

"As for profitability, the gap will widen between banks that have adopted the new Basel II capital standards and those that have not," adds Tan.

In particular, Moody's expects that in 2020, the country's central bank will grant higher limits for loan growth to banks that have adopted Basel II and maintain good financials. The higher growth limits will translate into larger gains in earnings and widen the profitability gap between banks that have and have not adopted the new capital standard.

According to Moody's, its analysis is based on the latest released results of 16 Vietnamese banks, which together accounted for 61 per cent of total banking system assets at 30 June 2019.

Toyota recalls Vios and Corolla Altis in Vietnam to replace airbags

1,526 locally assembled Toyota Vios manufactured between September 13, 2007 and December 31, 2008 and 35 Toyota Corolla Altis cars produced between November 9, 2004 and April 27, 2005, which were imported into Vietnam and distributed, have been recalled to replace a potentially dangerous airbag system.

According to Toyota Vietnam, the units have been installed with the new Takata passenger airbag assembly, which contain air pumps manufactured by Takata Corporation without moisture-proof substance.

In case of an accident, if the airbags are activated, depending on the circumstances, the release of inert gas can create too much internal pressure and lead to the possibility of the air pump cluster cracking. This could lead to metal fragments of the air pump being splashed through the inflated airbag, leading to the risk of serious injury to passengers.

Therefore, Toyota will replace the existing Takata pump by products from other suppliers.

Toyota Vietnam said that so far, the firm has not recorded any accident related to the above error.

The expected inspection and replacement time is about 1-5.5 hours per vehicle and is completely free at all Toyota dealers nationwide.

Vietnamese banks take measures to help coronavirus-hit businesses

Commercial banks in Vietnam have provided assistance to more than 44,000 business customers affected by the coronavirus outbreak by delaying loan repayments, lowering interest rates, cutting fees and introducing new credit programmes.

Such measures have been taken with more than VND222 trillion (US$9.56 billion) worth of outstanding loans, according to reports at a conference hosted by the State Bank of Vietnam (SBV) on February 2.

Head of SBV’s credit department Nguyen Quoc Hung said the coronavirus outbreak has caused many businesses to be unable to repay their loans on time, resulting in increased bad debt and debt arrears.

Reports by 23 banks showed an estimated VND926 trillion (US$39.9 billion) in outstanding loans affected by the virus outbreak, accounting for 14.27% of total loans by these banks.

Some of the hardest hit sectors include agriculture, tourism, accommodation and food services, transport, garments, footwear and electronics.

As part of measures to cushion the impacts of the coronavirus outbreak, nearly 30 banks and the National Payment Corporation of Vietnam (NAPAS) also rolled out wire transfer fee reduction or elimination in order to share the difficulties with their customers and boost non-cash payment.

Speaking at the conference, SBV Deputy Governor Dao Minh Tu asked credit institutions to build on the initial results and step up their efforts in order to support coronavirus-hit businesses.

Solutions implemented to boost exports of agricultural products

he import and export of Vietnamese agricultural products to China have faced numerous difficulties with the sharp declines in both volume and value of goods amid the complicated developments of the Covid-19 epidemic. The customs clearance of goods through border gates has initially been restored, but remains slow and incomprehensive.

Although import-export activities at Huu Nghi Border Gate have returned to normal, the progress in clearance has not seen much improvement because the two sides are still intensifying measures in the prevention and control of Covid-19 epidemic, according to the Department of Industry and Trade of Lang Son Province. In particular, the number of Chinese labourers in charge of loading and unloading of goods is small while the number of vehicles transporting goods through the border gate is only equivalent to 40% of the time before the spread of the epidemic.

As many as 319 container trucks carrying agricultural products, including jackfruit, dragon fruit, mango, longan, chili and other commodities, remained stuck at Tan Thanh Border Gate on February 25, despite the reopening of the border gate on February 20.

43 trucks of watermelon, dragon fruit, banana and mango have been exported to China while Vietnam has imported 11 trucks of ginger, onion, potato, and fresh mushroom from the Chinese side. 110 trucks (mainly dragon fruit and watermelon) remain waiting for export procedures. Meanwhile, 11 trucks carrying peanuts, groceries, cowhide, cosmetics, and frozen fish are stuck at Coc Nam Border Gate.

According to the Customs Branch of the Dong Dang International Railway, hundreds of carriages carrying over 1,000tonnes of Vietnamese fresh dragon fruit have been piloted to export to China through the railway since the beginning of February. Accordingly, for the first time, agricultural containers were loaded onto freight trains to be shipped to Pingxiang Railway Station in China. The move has helped goods to be moved quickly while reducing costs and avoiding congestion.

Phung Quang Hoi, Director of the Department of Industry and Trade of Lang Son Province, said that the department will coordinate with relevant units to continue implementing solutions to speed up the clearance of goods, contributing to the promotion of goods export and consumption of agricultural and aquatic products.

The Customs Branch of Mong Cai City, Quang Ninh, has set up four working groups to support import-export activities. Head of the Customs Branch Nguyen Van Hoan said that a temporary pontoon bridge has been set up at the ICD Thanh Dat port to facilitate the import and export of goods. A temporary pontoon bridge on Ka Long River officially resumed its operation on February 25 which helped to export five tonnes of lobster, worth VND1.2 billion (US$52,000). Meanwhile, goods valued at over US$5 million have passed through Bac Luan II Bridge since February 7.

The current priority export items include fresh fruits, agricultural products, fresh aquatic products, cashew nuts, and cassava starch.

In addition, the border market of Hoanh Mo in Binh Lieu District, Quang Ninh Province, has resumed the clearance of goods after a temporary suspension due to Covid-19, with the initial clearance provided for seafood, agricultural and forestry products.

At Kim Thanh Border Gate, connecting Vietnam’s Lao Cai with China’ Ha Khau (Hekou), agricultural products have been facing huge stockpiles due to the Covid-19 epidemic, creating adverse impacts on the production and lives of peoples of both countries. The functional forces of Vietnam and China are working together to remove difficulties and accelerate the clearance of goods.

By closely monitoring the situation, the two sides came up with suitable solutions. The Management Board of Lao Cai Economic Zone has established "designated transit driver teams" to transport imported and exported goods through Kim Thanh Border Gate no.2.The initiative helps to shorten the clearance time and increase the clearance capacity at the border gate. An average 130 trucks are now cleared at the border gate each day, an increase of 40 trucks compared to the previous time. In addition, the Lao Cai Railway Transport Branch has also set up a "specialised train operation team” in a bid to quickly handle import and export goods.

Chairman of the Lao Cai Economic Zone Management Board Nguyen Ngoc Khai said that nearly 20,000 tonnes of goods, mainly dragon fruit, watermelon, jackfruit and banana, have been exported to China through Kim Thanh Border Gate no.2,with a total import-export turnover of overUS$32 million. Export and import activities are expected to increase in the coming days.

The Management Board of Lao Cai Economic Zone has developed a plan to establish more areas to gather trucks into the Kim Thanh logistics warehouse with a capacity of up to 1,000 vehicles to facilitate the clearance of goods.

Meanwhile, Chairman of the People's Committee of Mong Cai City Nguyen Tien Dung said the city has talked with Dongxing City in China to actively build plans to resume the clearance of goods through the shared border. The city also requires warehouse businesses to have a preferential policy for enterprises who have to preserve their goods while waiting to be exported to China.

At the same time, the city will investigate and monitor the market situation to have a plan to connect domestic enterprises and prepare goods to export immediately after the border gate is opened.

Director of the Import and Export Department under the Ministry of Industry and Trade Phan Van Chinh said that the provincial Departments of Industry and Trade have closely coordinated with the Import and Export Department and functional units of the Ministry of Industry and Trade to promptly update the import and export situation through border gates as well as create favourable conditions for enterprises to accelerate the clearance of goods.

The Ministry of Industry and Trade will also work together with relevant ministries, sectors and localities to continue removing difficulties for import and export activities and boosting the consumption of goods, especially agricultural and aquatic products. The ministry will also work to deal with the shortage of raw materials for domestic manufacturing and processing due to the effects of the Covid-19 epidemic spreading to many countries around the world.

E-commerce firms fall behind vendors taking advantage of COVID-19

E-commerce firms are having difficulties in keeping tabs on vendors flogging unauthenticated or downright fake goods to profiteer on the sky-high demand for face masks and hand sanitiser due to the coronavirus epidemic.

The health crisis is a great opportunity for traders of healthcare items like medical face masks and hand-sanitiser gels, with sales going through the roof and vendors taking sales to e-commerce platforms in growing numbers.

As of February 24, about 465,000 vendors have been selling 1.7 million related products on e-commerce platforms like Sendo, Shopee, Lazada, Tiki, Fado, Bibomart, and Concung, according to Vietnam e-Commerce and Digital Economy Agency (iDEA) under the Ministry of Industry and Trade.

The skyrocketing demand for these goods has also made supervision of fake and low-quality goods a daunting task to say the least, with a tremendous number of goods of dubious quality being on sale at sky-high prices.

"This is a very dangerous practice on many levels. On one hand, dishonest vendors take advantage of the rising general price level to make a tidy profit, but they are also taking advantage of the customer psychology that ties higher prices to high quality. This will go at the expense of customer trust in e-commerce at large," a market analyst told VIR.

With the coronavirus epidemic hitting Vietnam a few weeks ago, a package of 100 Japanese medical face masks was offered for VND2.7 million ($117.39) on Shopee, as much as 10 times the market price from before the epidemic. As soon as receiving complaints from customers about the unusual pricing, the e-commerce firm removed it from the search results.

Besides, thousands of unauthenticated healthcare goods have been traded on e-commerce platforms recently. The iDEA reported that about 5,200 vendors with more than 21,000 of fake and unauthenticated goods were discovered and handled on the two e-commerce platforms.

Sendo has topped the list of violations with more than 2,000 vendors and 3,000 medical face mask products. Just for hand-sanitiser gel products, the platform had about 1,000 merchants and 1,500 items in violation of its policies. Shopee ranked second, with 3,000 vendors and 3,500 face masks. Of these, 400 vendors and 500 products have been sanctioned.

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In a talk with VIR last week, a Sendo representative said, “We have been seeking more prestigious suppliers to meet the demand for face masks and other related products.”

Echoing this, Shopee’s representative also said that the firm has been keeping a close eye on the performance of vendors selling these items and “will block the accounts of vendors found in violation.”

Indeed, these are not the first time the platforms getting stuck with the unqualified good issue. Last June, local book manufacturer First News Co., Ltd. announced that Shopee, Lazada, and Sendo are abetting the consumption of fake and pirated books violating the law. The company said that an uncountable number of fake books were displayed for sale online.

Vietnam to contribute a quarter of Central Group susidiary's revenue

In the next five years, Vietnam's contribution could grow to 25 per cent of the revenue of Central Retail, a Central Group subsidiary which has just conducted a successful $8.1 billion IPO.

Thailand's retail conglomerate Central Group plans to expand business operations in Southeast Asia through its subsidiary Central Retail Corporation. Discussing these plans, CEO of Central Retail Corporation Yol Phokasub told Nikkei Asian Review that Vietnam and Thailand are the company's focus markets after its record IPO of $8.1 billion in Thailand.

Central Retail has been growing its department store business. As of last September, Central Retail operated 1,922 stores in Thailand, 133 in Vietnam, and nine in Italy. In addition to groceries and supermarkets, the group also manages a series of sporting goods, housewares, and electronics stores.

At present, 75 per cent of Centrail Retail's revenue comes from Thailand, 17 per cent from Vietnam, and 7-8 per cent from Italy. "In five years, Vietnam's contribution will rise to 25 per cent," said the corporation's CEO.

Central Retail's raised $2.42 billion through its IPO, the largest ever in the Thai stock market. The prospectus suggested the proceeds will be used to expand and renovate its domestic and international store networks.

Central Group Vietnam is a member of Central Group, which has been present in Vietnam since July 2011. The group's business activities in Vietnam range from electronics, sports, fashion, shopping centres, and hotels to e-commerce and supermarkets.

The group made headlines in Vietnam with its acquisition of a chain of 33 supermarkets and hypermarkets owned by Big C for $1.05 billion in April 2016, and electronics chain Nguyen Kim in 2015.

Shares of Central Retail ended at $1.33 at its debut on the Stock Exchange of Thailand on February 20, equivalent to a market capitalisation of $8.1 billion, making it the 13th-largest company on the exchange.

EVFTA a boon for the wood industry

The EU-Vietnam Free Trade Agreement (EVFTA) is anticipated to usher in big opportunities for the local wood processing sector, with Vietnam’s wood export value to the EU possibly touching $1 billion in the first year after the deal takes effect.

Nguyen Chanh Phuong, deputy chairman cum general secretary of the Handicraft and Wood Industry Association of Ho Chi Minh City (HAWA), estimated that Vietnam could rake in $1 billion in export value of wood products to the EU right in the first year of the EVFTA's enforcement.

Before the deal got the thumbs-up from the European Parliament, two years ago, several Western Eropean countries approved zero per cent export duties for wood products exported from Vietnam, providing Most-Favoured Nation (MFN) treatment to Vietnam.

As negotiated, after the EVFTA comes into force, about 83 per cent of tax lines on wood products will be cut from 6 to 0 per cent right after the deal comes into force, and the remaining 17 per cent will fall to zero per cent after five years of enforcement.

A HAWA representative said that in the short term, Vietnam’s wood processing industry would not benefit much from tariff cuts, and the cuts are not larger than those of Vietnam’s key export items to the EU, such as textile and clothing, footwear, and agricultural products.

In the long-term, with EVFTA having large spillover effects on other commodities, the wood industry will become indirectly beneficial.
In the long-term, with the EVFTA having large spillover effects on other commodities, the wood industry will become indirectly beneficial.

Particularly, under the EVFTA, local businesses can take advantage of the production technology, management expertise, as well as cutting-edge machinery and equipment of EU countries.

“In the past, these machinery and equipment items often incurred 20-30 per cent tariffs. The EVFTA coming into force will help lower prices, even provide exemptions or deferred payments,” said HAWA representative.

Simultaneously, the EU-Vietnam Investment Protection Agreement (EVIPA) will aid the investment process in Vietnam, helping to lure investors into the furniture and wood processing industry from Europe to Vietnam, from there helping the local wood industry to avail of the capital, techniques, and management expertise of EU investors.

Broad commitments on investment under the EVIPA will facilitate EU investors’ business in Vietnam.

“Vietnam might become the centre for EU trade and investment in the region. Another, not minor benefit is that Vietnamese firms can import high-quality timber with clear origin from the EU,” said Phuong.

Vietnam exported nearly $700 million worth of wood products to the EU in 2019, accounting for about 8 per cent of the sector’s total export value. Not only a big partner in wood export, the EU also acts as an important timber supplier for Vietnam.

Key wood items Vietnam imports from the EU are round wood, sawn wood, veneers, and plywood at an estimated volume of more than one million cubic metres per year, for export processing and domestic consumption.

International schools may benefit from expected leaving of Hong Kong expatriates

International schools in Vietnam may welcome a rising number of foreign students as expatriates in Hong Kong wish to leave for the impact of the coronavirus outbreak.

With six out of 17 coronavirus cases having been cured in Vietnam – a positive sign for local investment – expatriates in Hong Kong may shift to the Southeast Asian country to avoid the epidemic season.

Vietnam currently has 24 international schools, including 11 in Hanoi and 13 in Ho Chi Minh City. At least half of the students of non-nationals, in line with Decree No.86/2018/ND-CP outlining the ratio of overseas students at foreign-invested education institutes.

Bloomberg has quoted the French, and British chambers of commerce in the country as saying that foreign families are considering to leave Hong Kongif the coronavirus epidemic is prolonged in the area.

“If the specific needs of international schools cannot be rapidly addressed, this will very likely trigger decisions of families (not just expatriates) to leave Hong Kong in the coming weeks,” wrote Rebeca Silli and Peter Burnett, chairmen of the French and British chambers. “This would also have dramatic consequences on the international schools’ financial position, even to the point of putting at risk the continued operation of some.”

Hong Kong students have not returned to school since the scheduled Lunar New Year break in late January. The city has 56 confirmed cases of coronavirus infection and is on the front lines of the global battle to contain the illness, which has claimed more than 1,300 lives in mainland China since emerging in December.

Quang Ninh: 108 million USD for infrastructure development in Ha Long city

Ha Long city in the northern coastal province of Quang Ninh has planned to spend 2.5 trillion VND (nearly 108 million USD) on 57 public works, especially transport infrastructure projects, in 2020.

Accordingly, the construction of Tran Quoc Nghien coastal ring-road was re-started after the Lunar New Year Festival and is expected to be completed in April this year, creating a new tourism space in the city.

As many as 950 billion VND has been invested in upgrading and expanding streets in Hong Hai and Hong Ha wards, connecting main transport routes.

Sidewalks for pedestrians in Dang Ba Hat street will be upgraded with a total cost of 210 billion VND.

Additionally, the October 30 Square, the fishing port at Cao Xanh ward, and water drainage and lighting systems in the city will be also upgraded.

The city is resolved to complete on schedule land clearance work for key projects such as bridges Cua Luc 1 and Cua Luc 3, and roads connecting the Ha Long – Van Don expressway and Hoanh Bo district, with the aim of promoting development in far-flung areas.

The municipal authority has also coordinated with relevant agencies to accelerate land clearance work for projects launched last year./.

Vietnam, US enhance farm produce trade

Vietnam has so far granted licences to 460 US producers of meat and meat products and 210 exporters of aquatic products, said Deputy Minister of Agriculture and Rural Development Le Quoc Doanh.

Doanh is leading a Vietnamese delegation on a working trip to the US from February 24 – 29 to discuss boosting farm produce trade between the two countries. He was accompanied by representatives from 19 enterprises and one trade association operating in cereals and animal feed; meat, dairy and seafood products; fruits and vegetables; wooden furniture; and chemicals and fertilisers.

During a working session on February 24 with US Under Secretary of Agriculture for Trade and Foreign Agricultural Affairs Ted McKinney and Ambassador Gregg Doud, Chief Agricultural Negotiator in the Office of the US Trade Representative, Doanh said Vietnam has also allowed the import of six kinds of fresh fruit from the US, which are cherry, pear, grape, apple, blueberry and orange.

Meanwhile, Vietnam is assessing quarantine and bio-safety risks regarding grapefruit, nectarine, apricot and plum from the US with a view to early allowing the import of the fruits, he said.

The deputy minister suggested that the US Animal and Plant Health Inspection Service should quickly allow the Hanoi Irradiation Centre and the Toan Phat Irradiation Company Ltd to provide radiation of US-bound fruits, thus helping Vietnamese firms cut costs of transporting fruits to the south for radiation. He also asked the US side to allow the vapor heat treatment for fresh fruits besides radiation, and urged the completion of risk evaluation procedures to Vietnamese pomelo to be exported to the US.

As scheduled from March 2 – 13, the US Department of Agriculture (USDA) will send a delegation to Vietnam to conduct a periodic review on the safety control programme for siluriformes fish exported to the US.

Deputy Minister Doanh also asked the USDA to continue assisting the Vietnamese Ministry of Agriculture and Rural Development in holding intensive training courses on catfish inspection programme, and consider signing a bilateral trade agreement with Vietnam to offer incentives to investors and businesses in agriculture in particular./.

Vinpearl’s subsidiary begins operation in Russia

Vinpearl Travel RU, the first overseas subsidiary of Vietnamese resort company Vinpearl, has started its operations in Russia.

Headquartered in Moscow, Vinpearl Travel RU will provide Russian holidaymakers with full tour packages, including sightseeing, golf playing, and casino games.

Russia’s Ingosstrakh insurance company will ensure finance for the Vietnamese travel firm, while national flag carrier Vietnam Airlines will be its aviation partner.

The first weekly flights are scheduled to start from March 12.

Vinpearl Travel RU is planning to carry out at least 168 flights and serve over 50,000 Russian tourists in Vietnam in 2020.

It will also offer flights from Moscow, Vladivostok, and Novosibirsk and Yekaterinburg to Nha Trang resort city in central Khanh Hoa province and Phu Quoc island in southern Kien Giang province.

Vinpearl is the largest tourism and entertainment network in Vietnam with 45 complexes in 17 cities, including 35 hotels with 17,200 rooms and villas, four entertainment parks, two safari parks, and four golf courses./.

Thailand imposes anti-dumping duty on Vietnamese steel products

Thailand will impose anti-dumping tariffs ranging from 6.97 percent to 51.61 percent of cost, insurance and freight (CIF) prices on some imported steel products from Vietnam, the Trade Remedies Authority of Vietnam under the Ministry of Industry and Trade said.

The Vietnam Trade Office in Thailand has informed the authority on Thailand's final conclusion of an anti-dumping investigation on a number of iron and steel pipes and tubes originating or imported from Vietnam including 169 HS codes.

The move aims to protect the Thai domestic manufacturing sector.

However, anti-dumping duties are exempted from the importation of related goods for production for export, goods imported for special use or goods classified as special categories.

In accordance with the Anti-Dumping Agreement, the anti-dumping duty will be applied for a maximum of five years and members can carry out any reviews every year.

Therefore, the Trade Remedies Authority of Vietnam recommended that relevant Vietnamese exporters continue to consider participating in the reviews to ensure their rights and interests./.

Room for Vietnam-US farm produce trade remains huge: roundtable

Vietnam and the US still hold huge potential for cooperation in farm produce trade, and the two countries should not compete in trade but supplement each other, Deputy Minister of Agriculture and Rural Development Le Quoc Doanh has said.

The official made the remark while attending a roundtable with representatives of associations and firms of the US in Washington DC on February 24, aiming to bolster bilateral farm produce trade and raising the two-way trade growth.

He is leading a delegation of the Ministry of Agriculture and Rural Development (MARD) on a visit to the US from February 24-29, part of an action plan towards harmonious and sustainable trade balance of the two countries.

Speaking at the event, Doanh affirmed that the Vietnam-US relations over the years have thrived in various fields, including cooperation in agriculture and farm produce trade.

The US is the leading nation of the world in modern agricultural production, while Vietnam is restructuring agricultural sector in an efficient manner in tandem with market demand and boasts strengths in tropical products such as fruits and high quality seafood.

Therefore, businesses should capitalise on the chance to bolster bilateral farm produce trade, Doanh said.

The US is currently the third biggest trade partner of Vietnam, while Vietnam has become the 27th largest export market and 16th trade partner of the US.

At the roundtable, representatives of US sectors voiced their willingness to support and create optimal conditions for Vietnamese firms in the coming time.

The two sides also exchanged information and pointed out difficulties, such as high costs of imported items and tariffs, and long transport duration, among others.

To address those bottlenecks, firms are advised to thoroughly study markets and export-import regulations of respective country, as well as frequently update information and participate in trade promotions held by the MARD and the US Department of Agriculture to seek business partners.

They should promptly report problems and send recommendations to the two agricultural agencies to find solutions and create favourable conditions for agro-forestry-fishery trade of the countries.

After Washington DC, the Vietnamese delegation will join activities in other US states of Iowa and Nebraska./.

Vietnam’s steel import falls 18 percent in January

Vietnam imported a total 944,865 tonnes of steel in January, a year-on-year drop of 18 percent, according to the General Department of Customs.

During the month, the country splashed out 570.07 million USD on steel purchases, decreasing 28.8 percent from the same period last year.

The strongest falls were witnessed in the Russian market (down 97 percent in both volume and value), the Brazilian market (down 90 percent in both volume and value), and the Mexican market (down 72 percent in volume and 83.4 percent in value).

In stark contrast, imports surged from France, up 14.9 times in quantity and 13.5 times in value. Purchases from Hong Kong also witnessed a significant climb of 823.3 percent in volume and 252.9 percent in value.

However, most steel imports came from India with 218,043 tonnes, rising 661.6 percent from the same time last year./.

Management of coastal shipping remains low par: conference

The transport sector needs to issue separate circulars to manage coastal transport operations for cargo ships, especially bulk cargo ships, a type of ship that runs off the coast and on rivers.

It was proposed by the Vietnam Maritime Administration and the Vietnam Inland Waterway Administration during a conference last week to discuss the management of coastal transport routes for bulk vessels.

According to the report by the Vietnam Inland Water Administration, after five years of opening transport routes for river-sea compatible ships since 2014, there are 839 bulk ships. Of which 305 ships were newly built and the remaining ships were upgraded to bulk carriers from river vessels.

The shipping volume of bulk ships totalled more than 144 million tonnes of cargo a year, increasing by 204 percent yearly.

The establishment of coastal transport routes has relieved the burden on road transportation.

However, there are still gaps in management as well as limitations that affect maritime safety and transport efficiency, such as the lack of connection between agencies on licensing and monitoring operation of vessels and uniformity of sanctions, officials said.

Vessels lack standard safety equipment and skilled individuals with experience in maritime transport.

It is reported that 39 accidents have occurred in coastal transport route related to bulk vessels over the past five years, sinking 27 ships and leaving three dead.

Agencies' leaders said they would review related issues to propose solutions to better manage bulk cargo ships in accordance with regulations on safety and maritime security.

As per transport ministry regulations, bulk cargo ships are allowed to carry only goods and not allowed to travel beyond 12 nautical miles from the coast./.

Apparel, footwear enterprises seek material supplies amid COVID-19

Garment-textile and footwear enterprises are seeking material supplies from markets besides China amid the complicated developments of the acute respiratory disease caused by SARS-CoV2 (COVID-19).

According to the Vietnam Textile and Apparel Association (VITAS), the garment-textile industry imports about 70 percent of its materials from China.

Vice chairwoman and secretary general of the Vietnam Leather and Footwear Association Phan Thi Thanh Xuan said the sector also largely depends on imported material from China.

If Chinese factories’ output slows, it would be impossible for Vietnamese footwear companies to meet their production plans.

Chairman of VITAS Vu Duc Giang said if the epidemic continues to prolong, many businesses are likely to suspend operations due to a lack of materials.

Given this difficulty, the Vietnam National Textile and Garment Group (VINATEX) has been focusing on producing face masks as a way to maintain operation.

Many businesses have set up face mask production chains to maintain production and limit the damage caused by the COVID-19 epidemic.

Vice chairman of VITAS Truong Van Cam said to prepare for the worst scenario, some garment-textile and footwear firms are planning to import materials from the Republic of Korea, India, Bangladesh and Brazil to make up for the shortage of materials.

The Ministry of Industry and Trade said it will help the sector to seek appropriate suppliers.

In 2020, the garment-textile and footwear sectors aim to gross about 42 billion USD and 24 billion USD in export turnover, respectively. However, these targets are unlikely to be met due to the impacts of COVID-19, according to insiders./.