The interest rate reduction was commonly 0.5-2 percentage points per year

Commercial banks cut interest rates on 980 trillion VND (42.6 billion USD) worth of loans to support 318,000 COVID-19 affected individual and corporate borrowers by the end of April, the latest data from the State Bank of Vietnam (SBV) showed.

The interest rate reduction was commonly 0.5-2 percentage points per year. Some credit institutions even offered a higher rate cut of 2.5-4 percentage points per year.

It was estimated if the banks cut the rate by 1 percentage points on average for the 980 trillion VND in loans, their profits will be lowered by at least 100 trillion VND.

By the end of April, banks also rescheduled debt repayments for more than 170,000 customers with loans of nearly 130 trillion VND, according to the SBV’s data.

The SBV has required commercial banks to further simplify lending procedures to help COVID-19-affected firms easily access preferential interest rate loans. However, he noted, banks must still meet lending standards to ensure the safety and stability of the financial and banking system.

Some businesses have recently claimed they could not access new loan packages with preferential interest rates due to their failure to meet banks’ lending standards and proposed that banks ease lending rules.

However, Nghiem Xuan Thanh, chairman of Vietcombank, said most companies that could not access the package are inefficiently operating their businesses.

Banks would not ease lending standards as they must avoid risks, Thanh noted, explaining that the package does not come from the State budget but from commercial banks.

Echoing Thanh, Tran Hoang Ngan, head of the HCMC Economic Development Institute, said banks are themselves businesses so they are always afraid of bad debts.

According to Nguyen Quoc Hung, director of the SBV’s Credit Department, in the current situation, it is forecast the bad debt ratio of the banking system will increase this year and negatively affect the country’s plans to deal with bad debts and recover poor-performing banks.

Vietnam focuses on four major measures to boost wood exports

Minister of Agriculture and Rural Development Nguyen Xuan Cuong has said that Vietnam is focusing on four measures to bolster wood and wooden product export growth this year.

At a conference held by the Ministry in Hanoi on May 15, Cuong said support in credit, welfare, taxation, and land use payments has been provided to 4,600 manufacturers.

Exporters are also tapping into markets that have controlled COVID-19.

He suggested all associations and enterprises review their business strategies to ensure the best conditions possible are in place for excellent performance in the third and fourth quarters.

Cuong highlighted the need to continue restructuring the sector in a modern and sustainable manner and to form major corporations and industrial zones specialised in wooden product manufacturing on a regional and global scale that could join global supply chains.

Director General of the Vietnam Administration of Forestry Nguyen Quoc Tri said wood and wooden product exports are forecast to reach nearly 11.75 billion USD this year, up 3.9 percent against 2019 but down 6.6 percent compared to the yearly target.

The figure for the second quarter is predicted to near 2.18 billion USD, down 20 percent year-on-year.

In the third and fourth quarters it is expected to reach about 3.12 billion USD and 3.82 billion USD, up 10 percent and 15 percent, respectively.

Tri said all enterprises are eligible for extensions on value-added and corporate income tax payments.

Associations proposed further support for businesses such as extensions and exemptions on social insurance payments and unemployment insurance and additional preferential credit packages.

Minister Cuong pledged to collect suggestions from the conference for submission to the Prime Minister and sectors to adjust policies to suit actual circumstances.

Cambodia pushes for FTA talks with potential partners

The Cambodian government is pushing for free-trade agreement (FTA) talks with potential partners while seeking Russia’s help for a Eurasian Economic Union (EAEU) free trade agreement, local media reported.

The Cambodian Ministry of Commerce’s Secretary of State Tek Reth Kamrong said during her recent meeting with Russian Ambassador to Cambodia Dmitry Tsvetkov that Cambodia will ask for a third meeting between Cambodia’s working group and the Europe Economy Committee (EEC) via videoconference next July, according to the Khmer Times.

The EAEU is home to 183 million people and represents a combined GDP of about 5 trillion USD. The bloc has five member states - Russia, Armenia, Belarus, Kazakhstan and Kyrgyzstan.

Cambodia is closer to inking trade deals with developed economies despite the ongoing COVID-19 pandemic, the newspaper said.

Cambodian Minister of Commerce Pan Sorasak had a meeting with the Ministry’s policy and strategy maker for FTAs to examine the working group’s progress on May 13.

Pan Sorasak said that the Cambodia-China FTA is progressing well, while the Cambodia- Korea talks are bearing fruit. The government has empowered the ministry to strengthen Cambodia’s competitiveness and trade and economy diversification via promoting FTAs.

Seang Thay, a spokesperson at the Ministry of Commerce, said the negotiations with the EAEU may take longer than agreements country by country.

Cambodia started to study the benefit of FTAs with the EAUE in 2016 and have formed working groups to exchange information but the process is too slow because the bloc needs to be united. Cambodia has already exported some goods to the EAEU but Cambodia needs to negotiate for more access to the bloc, according to Seang Thay.

The Cambodian Ministry of Commerce has established eight different groups to be in charge of the trade negotiations with each potential partner, including working groups in charge of trade talks with China, the Republic of Korea, the UK, the EAUE, the US, Japan, Mongolia and India./.

Malaysia drops charges linked to 1MDB scandal

Malaysian prosecutors have dropped money laundering charges linked to the 1Malaysia Development Berhad (1MDB) scandal against the Hollywood producer Riza Aziz.

Riza, whose Red Granite Pictures produced the Oscar-nominated film “The Wolf of Wall Street”, had been accused of laundering 248 million USD in money misappropriated from a government investment fund.

However, a Malaysian court on May 14 dismissed charges against Riza, under an agreement in which he will return assets worth millions of ringgit.

The 1MDB was founded by former Malaysian Prime Minister Nazib Razak in 2009 with the aim of boosting the country’s socio-economic development.
Malaysian and American investigators believe that the fund has looted about 4.5 billion USD, about 1 billion USD of which was sent to Nazib’s personal bank account.

ILO project seeks to enhance SMEs’ resilience in COVID-19

The International Labour Organisation (ILO) and the Vietnam Chamber of Commerce and Industry (VCCI)’s HCM City branch on May 14 presented masks and hand sanitiser to companies in the wood and support industries.

Over 26,000 masks and 5,400 bottles of hand sanitiser were given to about 50 small- and medium-sized enterprises (SMEs).

This is the first relief effort initiated by the ILO in partnership with the VCCI HCM to enhance the firms’ resilience during the COVID-19 outbreak, which forms part of the Sustaining Competitive and Responsible Enterprises (SCORE) project.

Safety tops the concerns of firms and workers in the wake of the pandemic, a VCCI survey of more than 700 domestic firms has found. Some 69 percent of the respondents said spending on keeping workplaces safe is likely to expand by 10 – 30 percent in the coming time.

Order cancellations and lack of cash have made it difficult for SMEs to provide their employees with personal protective equipment (PPE) and hand sanitiser.

The SCORE project will do its best to help the enterprises mitigate risks and resume production, said Stephan Ulrich, SCORE Project Manager and Regional Project Coordinator at the ILO, adding the SMEs’ resilience depends on how they protect their workers.

Occupational health and safety are even more important in the face of the COVID-19. In addition to donations of masks and hand sanitiser, the SCORE will continue providing information on proper preventive measures against the coronavirus to employers and their employees via banners, leaflets, video clips and social media, he said.

Online training courses will also be held to give instructions on how to prevent virus transmission, assess associated risks and restart production, the official added.

The SCORE is a practical training and workplace improvement programme, aiming to increase SMEs’ productivity while promoting respect for workers’ rights. It focuses on SMEs in the wooden furniture industry in HCM City, Dong Nai, Binh Duong, Long An and Binh Dinh provinces.

A total of 230 companies have so far taken part in the SCORE, benefiting more than 94,000 workers./.

Online food sellers develop during pandemic

Online food sellers have long been known as a channel to buy local, unnamed products, but now they are growing as an effective source for branded food firms.

Nguyen Lam Vien, chairman and CEO of Vinamit Joint Stock Company, said the firm, which trades dried fruits, has developed a network of 200 online sellers during the pandemic.

“Thanks to online sellers, the firm’s sales are somewhat less terrible during the difficult time,” Vien told nld.vn.

Vien said revenue dropped at most of the distribution channels, such as stores and supermarkets, however, online sales have been improving.

In April, these online collaborators brought the company more than 800 million VND (34,000 USD). Vinamit has given the online collaborators bonuses alongside other traditional agents.

Similar to Vinamit, the Vietnam Animal Industry Joint Stock Company (Vissan), famous for their sausages, has cooperated with electronic wallet Momo and delivery service Now for trading the products.

It is also cooperating with firms that offer shopping via a hotline and most recently they worked with the e-commerce trading exchange Sendo.vn to promote sales.

Phan Van Dung, the firm’s vice director said: "We also have a plan to collaborate with Lazada to boost sales and expand our online sales agency network.” He added that in a more competitive context, the company also encourages its agents to diversify selling methods.

Pham Thanh Kien, director of the HCM City’s Department of Industry and Trade said the trend of online shopping, social networks and e-commerce has grown in the last two years.

Kien pointed out the rise was because online sales are managed more easily than other kinds.

Tran Hoang Ngan, director of the HCM City Development Research Institute said that online businesses, specifically those through e-commerce sites and social networks have been developing fast in recent years, especially amid COVID-19.

Ngan said the market has formed a team of traders who directly participate in the market without the legal guidance and management of the authorities, adding the government should organise skills training courses for them to form a healthier business environment./.

Vietjet offers 0 VND tickets to promote domestic travel

Budget airline Vietjet is offering more than 200,000 tickets priced at only 0 VND (excluding taxes, fees) on all routes from May 5 to June 30 in response to the "Vietnamese People Travel Vietnam" programme of the Ministry of Culture, Sports and Tourism.

Previously, Vietjet just concluded a special promotion of super-saving tickets priced only from 18,000 VND (0.77 USD) on May 16 with the flight period to December 31 this year.

With 45 domestic routes covering Vietnam, more than 300 green flights everyday and on-time performance at 97.4 percent, the new-age carrier Vietjet pioneers in recovering local economic activities, in order to stimulate domestic tourism and create favourable conditions for people to travel in the new normal context after COVID-19. People and tourists can fly freely with Vietjet across Vietnam to Da Lat of dreaming, cool and fresh air; Da Nang, Nha Trang, Phu Quoc with blue seas, white sand and sunshine; Central Highlands with majestic landscapes; Can Tho of gentle river region; Ho Chi Minh City of excitement; Hanoi of a thousand years of civilization; or Hoi An Ancient Town imbued with the traditional identities, etc.

More detailed information about flight schedule is available on Vietjet’s official information channels at website www.vietjetair.com, Vietjet Air mobile app, official Facebook page at https://www.facebook.com/vietjetvietnam/, ticket offices and official agents of Vietjet.

With a focus on cost management ability, effective operations and performance, Vietjet offers flying opportunities with cost-saving and flexible fares as well as diversified services to meet customers’ demands.

Vietjet is a fully-fledged member of International Air Transport Association (IATA) with the IATA Operational Safety Audit (IOSA) certificate. As Vietnam’s largest private carrier, the airline was awarded the highest ranking for safety with 7 stars in 2018 and 2019 by the world’s only safety and product rating website airlineratings.com and listed as one of the world's 50 best airlines for healthy financing and operations by Airfinance Journal in 2018 and 2019. The airline has also been named as Best Low-Cost Carrier by renowned organizations such as Skytrax, CAPA, Airline Ratings, and many others./.

Hanoi’s agriculture sector looks to grow post-COVID-19

Hanoi’s agriculture sector is facing a host of difficulties from the COVID-19 pandemic that require it continue with restructuring and switch to new crops to ensure growth.

Director of the municipal Department of Agriculture and Rural Development Chu Phu My said the sector’s growth fell 1.17 percent year-on-year in the first quarter due to difficulties in pig breeding following the occurrence of African swine fever.

There were only 1.1 million pigs in the city, down 31.25 percent year-on-year, with output of 51,000 tonnes, down 41.22 percent. The winter crop, meanwhile, was down about 10 percent.

Fishery output, however, increased 4.25 percent to 27,000 tonnes, while poultry heads totalled 33.5 million, up 17.54 percent.

My said the agriculture sector in the capital targets yielding 89,500 ha of rice, 1.8 million pigs, and 38 million poultry heads this year, and is expected to grow 6.26 percent.

Secretary of the Hanoi Party Committee Vuong Dinh Hue asked that pig breeding be stepped up to 1.8 million heads to curb the rising CPI and that more fruits and vegetables be grown.

He suggested effectively using industrial and non-cultivation land to meet food demand, issuing mechanisms and policies to use existing agriculture land effectively, and attracting unemployed people from rural to urban areas.

Hue asked the Steering Committee on Programme No. 02-CTr/TU from the municipal Party Committee on the development of agriculture, new-style rural areas, and improving farmers’ lives during the 2016-2020 period to increase resources for public investment, contributing to economic growth and improving workers’ incomes.

The city’s Farmers’ Union has been assigned to guide farmers on production, connect them with scientists, businesses, and banks, and form new-style cooperatives./.

Accessing credit requires firms to embrace financial transparency: experts

Enterprises, especially small and medium-sized ones and start-ups, need to enhance financial transparency and connect with banks if they want to obtain loans, according to experts.

“It is the same when seeking to raise capital,” said Lam Minh Chanh, founder of business school BizUni and co-founder of the Management and Startup Group.

Many SMEs still have unclear invoices when buying and selling, he said, warning that they need to be more transparent with respect to sales and revenues.

The pandemic has severely affected the global economy, including Vietnam, he said.

The immediate financial impact is significant for most big and small businesses, and how to raise capital during this difficult time to maintain operations and overcome this tough period is one of the top concerns of businesses, he said.

"It usually takes us three to six months to raise capital. During the epidemic period, businesses have died before they raised capital.

“Therefore, this is the period when businesses have to depend a lot on internal resources. Businesses must explore all ways to sell their products to earn revenues to first [survive]."

Dang Van Thanh, Chairman of TTC Group and the Vietnamese Brand Club, said the current high lending interest rates are a burden for businesses while banks are wary of lending due to risk concerns.

He said businesses should use their “savings,” which could be cash or even assets bought during profitable times to help them survive this tough time.

Concurring with him, Ngo Cong Truong, Chairman of John & Partners Consultancy and Education JSC, said, “SMEs should use their savings at this time … Another important thing is that businesses need to cut all unnecessary expenses."

Firms, especially start-ups, should focus on their core business segments, and stop ineffective ones and even close down if they do not see bright prospects, to start a new one.

Chanh said Vietnamese entrepreneurs often place a lot of enthusiasm and personal finances into start-up companies, and so when their companies face difficulties or failures, it takes more time for them to close the business compared to their counterparts in foreign countries.

Thanh said to control costs, businesses have to invest in technology and digital transformation.

The opportunity after the pandemic is real, and firms should reconsider their input sources to reduce reliance on imports, expand domestic market share, and seek new markets to capitalise on the opportunities on offer after the pandemic, he added.

Thai economy shrinks at fastest pace in eight years

Thailand’s economy contracted 1.8 percent in the January-March period from a year earlier, the sharpest fall in eight years in the first quarter, mainly due to the COVID-19 pandemic’s impact on tourism and domestic activity.

On a quarterly basis, the economy shrank a seasonally adjusted 2.2 percent, the country’s National Economic and Social Development Council (NESDC) said on May 18.

The state planning agency revised the quarterly GDP in the fourth quarter of 2019 to a 0.2-percent contraction from 0.2-percent growth, meaning the economy slipped into a technical recession.

It slashed its GDP forecast for 2020 to a contraction of 5.0 – 6.0 percent from growth of 1.5 – 2.5 percent projected in February, which would be the worst decline since 1998 when the Asian financial crisis damaged the economy.

Besides, the agency also cut its projection for this year's exports and foreign tourist numbers, the main drivers of Thai growth.

NESDC Secretary-General Thosaporn Sirisumphand warned that the economy will be hardest hit in Q2 by lockdowns before gradually recovering.

According to the statistics website worldometers.info, as of May 18 noon (Vietnam time), Thailand had recorded 3,028 COVID-19 infections, including 56 deaths./.

Construction of giant industrial park begins in Long An Province

 Tan Thanh Long An Investment JSC and Viet Nam Innovation Parks Management Corporation broke ground on Sunday (May 17) for the 1,800ha Viet Phat Industrial Park in Long An Province, one of the largest IPs in the country.

Situated in Thu Thua District’s Tan Long Commune, the IP will have an advantageous position in the Southern Key Economic Region, with convenient road and waterway transportation links with HCM City and other localities in the south.

Le Thanh, chairman and general director of Tan Thanh Long An Investment JSC, said there would be a 1,200ha industrial park and a 600ha urban area. All the land has been acquired and cleared, he said.

He said with the goal of developing a new-generation industrial park to facilitate green and sustainable development, the partners have chosen Singapore’s Surbana International Consultants Pte. Ltd and Jones Lang Lasalle Co, Ltd for planning, design and exploitation of the project.

“Viet Phat Industrial Park will prioritise green areas, adopt the latest technologies in management, operation, waste treatment, and protection of water and other natural resources to create a green, clean and modern living environment for the community and make it an ideal destination for investors.

“We believe … Viet Phat Industrial Park will not only help attract large investments to Long An Province, especially after the COVID-19 pandemic, and catalyse its sustainable socio-economic growth, but also offer locals stable jobs and increase incomes.”

Nguyen Van Ut, vice chairman of the Long An People’s Committee, said the project is a significant development for the province to proactively attract high-quality FDI amid a wave of investors shifting away from China and increasingly setting their sights on Southeast Asia. 

Ministry gives push to equitisation of SOEs

The Ministry of Finance has raised a number of measures to accelerate the equitisation of State-owned enterprises (SOEs) since the process had made no improvements recently.

According to the ministry’s Corporate Finance Department, the COVID-19 pandemic caused disruptions in production, business and other social activities, which also affected the equitisation and divestment of SOEs.

The equitisation and divestment had stagnated, the department said, pointing out that in the first four months of this year, no SOEs were privatised.

Statistics showed that from 2016 to April 2020, 174 SOEs had equitisation plans approved. They had total assets worth more than VND443 trillion (US$19.1 billion), in which the State capital accounted for 46 per cent.

Among the above 174 SOEs, only 36 enterprises completed equitisation following the Prime Minister’s Decision No 26/2019/QD-TTg dated August 15, 2019. This meant that 92 SOEs must be privatised in the remaining months of this year.

Ha Noi had 13 enterprises which must be equitised this year, HCM City 38, the Commission for the Management of State Capital at Enterprises six, the Ministry of Industry and Trade four and the Ministry of Construction two.

Deputy Director of the Corporate Finance Department Pham Van Duc said that the equitisation was expected to be speeded up in the remaining months of this year.

Among 92 enterprises which must be equitised this year, there were big companies which were expected to be attractive to investors such as Vietnam Bank for Agriculture and Rural Development, Viet Nam Posts and Telecommunications Group, Viet Nam National Coal – Mineral Industries Holding Corporation Limited, Viet Nam National Chemical Group and Mobifone Telecommunications Group.

According to the finance ministry, besides the impacts of the COVID-19 pandemic, the equitisation and divestment also faced bottlenecks in evaluating corporate value, especially in land value.

The ministry said that the urgent task was minimising the impacts of COVID-19 and bringing the economy back on its feet.

At the same time, focus would be placed on strengthening corporate finance management and improving the operation efficiency of SOEs.

The ministry also raised a number of solutions to speed up the equitisation in the remaining months of this year.

Accordingly, SOEs must complete the evaluation of their corporate value and publicise information by the end of this year. Accountability of the SOEs' leaders must be enhanced if the equitisation and divestment missed the plans.

Ha Noi City, the Ministry of Industry and Trade, and the Ministry of Construction must speed up the divestment as their workload remained huge. 

GEX to sell entire stake in Dong Nai Port JSC, no longer involved in logistics

The Board of Directors at Vietnam Electrical Equipment Joint Stock Corporation (Gelex or GEX) has approved the sale of their entire 20.25 per cent stake in Dong Nai Port JSC (PDN).

Dong Nai Port JSC is currently the owner of the seaport in the southern province of Dong Nai.

PDN closed Monday at VND64,400 (US$2.76) per share. Temporarily calculated at this price, GEX is expected to collect VND244 billion after the sale.

GEX closed Monday up 2.1 per cent to trade at VND16,750 per share. It bought the stake in PDN in April last year for VND247.5 billion.

Early last week, GEX also announced the divestment of its entire stake in its logistics arm Gelex Logistics Co Ltd. Expected divestment time is in the second and the third quarter.

These moves showed GEX’s definitive intention to withdraw from the logistics sector, one of the company’s key operations besides electrical equipment, energy infrastructure and real estate.

Gelex Logistics Co Ltd is directly in charge of transportation and warehousing services of GEX. Gelex Logistics has a charter capital of VND1.2 trillion and is wholly-owned by GEX.

Last year, Gelex Logistics reported VND1.64 trillion in net revenue, an increase of 4 per cent compared to the previous year, equivalent to 10.7 per cent of GEX’s consolidated revenue.

Gross profit reached VND361 billion, up 17 per cent from 2018. However, post-tax profit decreased by 22 per cent to only VND122 billion due to a decrease in financial revenue and a decrease in profit of associated companies.

According to GEX leaders, the company’s logistics segment focuses on two main areas including logistics operations (through its subsidiaries of Sotrans, Sowatco and Vietranstimex), and investment in logistics infrastructure.

However, in 2019, the operations of these subsidiaries all faced difficulties. In particular, Sotrans's revenue decreased by 68 per cent to VND319 billion due to corporate restructuring. However, the company's after-tax profit still increased by 11 per cent compared to 2018, reaching VND202 billion.

For Sowatco, the company recorded VND346 billion in net revenue in 2019, up 38 per cent, but post-tax profit dropped by 36 per cent to VND69 billion because of no longer financial income.

Vietranstimex recorded drops in both revenue and profit by more than 20 per cent compared to the previous year. Although the company successfully signed many contracts for large projects last year, its operation still faced difficulties due to fierce competition from transport companies in the same sector.

GEX's leaders also acknowledged that companies involved in logistics bear direct risks caused by several specific characteristics related to the value chain in the industry.

A professional logistics provider must be capable of integrating a series of import and export freight forwarding services into a continuous chain to ensure goods are shipped from manufacturers to consumers without interruptions.

However, it is hard for companies to do that in Vietnamese, they said, adding that the infrastructure for logistics services remained incomplete.

Due to the specific nature of the industry, service fees are often charged in foreign currencies, leaving companies facing the risk of losses due to exchange rate fluctuations, directly affecting their business results, they said.

GEX is also investing heavily in utility infrastructure including clean water. It is the owner of Song Da Water Investment Joint Stock Company (SDW), the enterprise involved in the contaminated tap water scandal in Ha Noi that took place at the end of 2019.

SDW has fixed the problems and got the green light from Ha Noi People's Committee to supply water back to the people. However, the company did not collect people's water bills for a month, causing sales and profits in 2019 to drop compared to 2018. 

OCOP trade fair underway in Quang Ninh

The “One Commune, One Product (OCOP)” trade fair 2020 is taking place in the northern province of Quang Ninh as part of a range of activities to promote trade and stimulate tourism throughout the locality.

The week-long event which opened its doors late last week has 350 booths showcasing typical OCOP products from various provinces and cities nationwide including handicraft products that originate from craft villages, and plenty of ornamental plants.

The OCOP fair aimed to remove hurdles that local businesses are facing during the pandemic while helping them gradually restore production, business, and consumption activities, the event's organisers said.

Nguyen Minh Tien, director of the Central Coordination Office on New Rural Development, emphasised the importance of the event, saying that it contributed to rebooting the local economy, providing a platform for businesses to introduce their latest products and promoting tourism growth.

During the first three days, the fair attracted 17,000 visitors, earning revenue of VND5.6 billion (more than US$240,000), according to the organising board.

The event will wrap up on Thursday.

The previous edition lured over 110,000 arrivals with total revenue of around VND10.2 billion.

The OCOP fair has contributed to developing concentrated production, creating higher added value products as part of the provincial agriculture restructuring and serving tourism development in Quang Ninh Province.

After six year implementation, Quang Ninh Province has mobilised more than VND500 billion to support the development of products under the programme, which has helped create jobs, increase incomes, develop sustainable forms of production, change consumer habits towards buying more Vietnamese goods, and creating high-quality goods and services, the online newspaper ven.vn reported.

As of last year, Quang Ninh had developed 421 OCOP products, including that 195 met 3-5 star standards. These products are widely introduced and sold at OCOP points of sale, commercial centres and supermarkets inside and outside the province. 

Customs enhance inspection of PFY imports

The General Department of Customs has required customs departments in provinces and cities to intensify review and inspection for imports of silament and polyester filament yarns originating from China, India and Indonesia.

On Sunday, the General Department of Customs said according to the data of customs procedures, it has discovered some problems in the inspection and determination of customs value for those fibre products.

Therefore, the general department has asked those customs departments to review the customs procedure data and update enough information on the data system.

They must have solutions for the situation of still accepting customs values according to declared prices.

Last month, the MoIT issued a decision on investigating anti-dumping duties on polyester filament yarn (PFY) with HS codes: 5402.33.00, 5402.46.00 and 5402.47.00 originating from China, India, Indonesia and Malaysia.

The investigation was conducted based on a 2019 request from the domestic manufacturers, which accounted for 67.4 per cent of the total domestic production. This investigation was for the period from January 1 until December 31, 2019 and reviewed the domestic PFY manufacturing industry’s losses in the period from 2017 to 2019.

The local enterprises have proposed the anti-dumping duty to be 17 per cent for filament yarn from China, 54.9 per cent for India’s products, 60.6 per cent for Indonesia’s products and 6.4 per cent for Malaysia’s products.

The MoIT would release the final anti-dumping duties for those products after the investigation ends.

According to General Department of Vietnam Customs, the amount of PFY imported into Viet Nam rose to 185,000 tonnes in 2019 from 154,000 tonnes in 2017. The sharp increase was considered a major cause of significant damage to Viet Nam's PFY manufacturing industry. 

Van Don EZ’s management board founded

Quang Ninh Province late last week announced the foundation of the management board of Van Don Economic Zone (EZ) which would be piloted in three years.

The management board would be a unit under the provincial People’s Committee and perform State management on Van Don EZ as well as provide public services relevant to investment, production and business for investors in the EZ following the established regulations.

Nguyen Xuan Ky, Chairman of the People’s Council, said that Van Don EZ was regarded as a major growth driver of the northern province, which together with other economic zones would accelerate the province’s transition to green growth model, promote the development of tourism, services, coastal urban areas and efficiency in using land resource.

Ky believed that the management board with streamlined administrative mechanisms would create favourable conditions for investors.

The Government gave the nod to the pilot foundation of Van Don EZ’s Management Board with the Resolution No 102/NQ-CP dated November 14, 2019.

Van Don, together with Van Phong in Khanh Hoa Province and Phu Quoc in Kien Giang Province, were identified to be three major economic zones of the country, which would drive regional growth.

Under Van Don’s planning with a vision to 2040 which was approved by the Prime Minister earlier this year, the economic zone was expected to be a marine eco-tourism centre and a hub for international trade. 

Accessing credit requires firms to embrace financial transparency

Enterprises, especially small and medium-sized ones and start-ups, need to enhance financial transparency and connect with banks if they want to obtain loans, according to experts.

“It is the same when seeking to raise capital,” Lam Minh Chanh, founder of business school BizUni and co-founder of the Management and Startup Group, said.

Many SMEs still have unclear invoices when buying and selling, he said, warning that they need to be more transparent with respect to sales and revenues.

The pandemic has severely affected the global economy, including Viet Nam, he said.

The immediate financial impact is significant for most big and small businesses, and how to raise capital during this difficult time to maintain operations and overcome this tough period is one of the top concerns of businesses, he said.

"It usually takes us three to six months to raise capital. During the epidemic period, businesses have died before they raised capital.

“Therefore, this is the period when businesses have to depend a lot on internal resources. Businesses must explore all ways to sell their products to earn revenues to first [survive]."

Dang Van Thanh, chairman of TTC Group and the Vietnamese Brand Club, said the current high lending interest rates are a burden for businesses while banks are wary of lending due to risk concerns.

He said businesses should use their “savings,” which could be cash or even assets bought during profitable times to help them survive this tough time.

Concurring with him, Ngo Cong Truong, chairman of John & Partners Consultancy and Education JSC, said, “SMEs should use their savings at this time … Another important thing is that businesses need to cut all unnecessary expenses."

Firms, especially start-ups, should focus on their core business segments, and stop ineffective ones and even close down if they do not see bright prospects, to start a new one.

Chanh said Vietnamese entrepreneurs often place a lot of enthusiasm and personal finances into start-up companies, and so when their companies face difficulties or failures, it takes more time for them to close the business compared to their counterparts in foreign countries.

Thanh said to control costs, businesses have to invest in technology and digital transformation.

The opportunity after the pandemic is real, and firms should reconsider their input sources to reduce reliance on imports, expand domestic market share, and seek new markets to capitalise on the opportunities on offer after the pandemic, he added. 

Rubber plantations converted into industrial land

There is a rising wave of converting rubber plantations into industrial land as developers eye spots for industrial zones to capture opportunities from global value chains.

Converting plantations into industrial land could be the answer for rubber companies facing falling rubber prices.

With large areas in Binh Duong, Dong Nai and Tay Ninh, rubber plantations had high potential for merger and acquisition (M&A) deals to turn them into industrial zones.

In Tan Uyen District, Binh Duong Province, about 345ha of Phuoc Hoa Rubber Company got the Prime Minister’s approval to be converted to develop the Nam Tan Uyen Industrial Zone’s expansion project.

At the annual shareholders’ meeting in 2019, Phuoc Hoa also said that it would transfer 691ha to Viet Nam Singapore Industrial Park Company Ltd. (VSIP) to develop VSIP No 3.

Dong Nai Rubber Corporation recently asked the provincial People’s Committee’s permission for the conversion of land use purpose of 18,000 out of 37,000ha of rubber land the company was currently managing.

Under the company’s proposal, 5,000ha of land would be used to develop industrial zones and clusters in Thong Nhat, Long Khanh, Cam My and Long Thanh districts. The rest would be used for developing high-tech agriculture and urban areas.

Mirae Asset Securities Viet Nam in a recent report estimated that more than 7,000ha of rubber land was planned to be converted into industrial land.

Investing in industrial zone development had become one of the major business lines of Viet Nam Rubber Group (VRG) which manages around 400,000ha of rubber land. As of September 2019, VRG invested in 12 companies which operated 16 industrial zones with a total area of more than 6,566ha.

According to BIDV Securities Company, the industrial property market would see significant growth from next year with the momentum gained from free trade agreements (FTAs), especially the European Union – Viet Nam FTA (EVFTA) – the trade deal with commitments about improving institutions and business climate which would make Viet Nam more attractive to investors.

In addition, the COVID-19 pandemic was accelerating the transformation of global value chains, during which Viet Nam could emerge as a centre for investment inflow.

Of note, Viet Nam was accelerating disbursement of public investment with a focus on infrastructure, which would benefit industrial parks in the long term.

A report by property service firm JLL Viet Nam showed that demand for industrial land remained high in the first months of this year despite the impacts of the COVID-19 pandemic.

Average leasing prices were up by 6.5 per cent against the same period last year to US$99 per sq.m in the northern region and by 12.2 per cent in the southern region to $101 per sq.m.

Experts, however, said that it was necessary to have a plan for converting rubber land into industrial parks to improve land use efficiency.

The Ministry of Planning and Investment’s statistics showed that there were 335 industrial parks with a total area of 96,500ha in Viet Nam as of November 2019. Of them, 256 were in operation with an occupancy rate of 75 per cent. 

Mastercard and CARE partner to support 1,000 women entrepreneurs in Viet Nam

Mastercard, along with Mastercard Center for Inclusive Growth, is collaborating with the non-governmental organisation CARE to provide direct assistance to some of those on the frontlines of the country’s economic recovery – Viet Nam’s women entrepreneurs.

As part of the collaboration, Mastercard and CARE will provide both funds and expertise that will enable 1,000 women micro entrepreneurs in Ha Noi and HCM City to drive a robust recovery followed by sustained long-term inclusive growth.

Part of the funds will be disbursed in the form of emergency cash and electronic transfers to help small, informal businesses kick start their operations as the economy reopens, while giving women flexibility to support their families financially.

In addition to providing women entrepreneurs with near-immediate assistance, the partners will be working together to bolster these businesses moving forward, creating stability and employment opportunities that will benefit their communities in the future.

“With success and resilience, Viet Nam has overcome the health implications of COVID-19. However, the journey to economic recovery is possible but it needs to start with the hardest hit section of the market – small business owners,” said Le Kim Dung, Country Director, CARE International in Viet Nam.

“With our partner Mastercard, we will re-ignite 1,000 women micro-entrepreneurs’ businesses, helping them to recover from the pandemic’s economic effects. Together we will deliver assistance now, and rebuild better, more equitably and inclusively,” said Dung.

“Through this partnership with CARE, Mastercard will be able to fulfill its commitment to unlocking the full economic potential of women entrepreneurs in Viet Nam and create a financially inclusive society for the digital age. Moving forward, Mastercard is committed to working with banks, businesses, consumers, and government partners in Viet Nam to ensure a strong recovery,” said Winnie Wong, Country Manager, Vietnam, Mastercard.

To provide support to Vietnamese businesses in the long run, Mastercard will leverage its banking and business networks, cyber security expertise, payments technologies and solutions, and vast data and market intelligence, while CARE will work with Women’s Initiative for Startups and Entrepreneurship (WISE), financial-inclusion fintech Canal Circle and VP Bank to tailor financial services and products that better suit the needs of women business owners. 

Son La exports mangoes to China

Thuan Chau District, Son La Province exported its first batches of 20 tonnes of mangoes to China on May 14.

This district has more than 1,300ha of mangoes with a total output of 1,000 tonnes, of which 700ha have been harvested, according to the people’s committee of Thuan Chau District. Thuan Chau mangoes have been grown according to international cultivation standards for export.

Nguyen Xuan Hoang, deputy chairman of Thuan Chau people’s committee told local media that since the beginning of this year, his district has coordinated with the provincial investment promotion centre and large export enterprises to seek local consumption and export contracts.

Two days ago, Son La’s Yen Chau District exported its first shipment of 30 tonnes of mangoes to China. Yen Chau District is home to more than 2,700 ha of mango farms, of which over 170 ha have been granted with an area code to become eligible for export, with approximately 130ha being provided with VietGAP certificates.

In Son La Province, 59 mango growing regions with total area of nearly 1,400ha have been granted area codes. Those mango growing regions are estimated to have a total output of 16,000 tonnes.

Of which, there are 14 regions supplying 1,200 tonnes of mangoes reaching standards to be exported to Australia, the US and other strict countries.

Meanwhile, the province expects to export 1,600 tonnes of mangoes to mainland China, Taiwan and South Korea this year. 

Viet Nam’s consumers optimistic amid COVID-19

Viet Nam’s consumers are some of the most optimistic, among Asian countries surveyed, that their country will weather the challenges of COVID-19, according to a McKinsey’s mid-April consumer survey.

The survey questioned 618 consumers in Viet Nam on their consumption behaviour shifts during the COVID-19 crisis.

The findings show that only 4 per cent of Vietnamese consumers surveyed believe the pandemic will have a long-lasting impact on the economy and create a lengthy recession. This is compared to 6 per cent in Indonesia, 16 per cent in the US, and 24 per cent in South Korea.

This optimism, coupled with the country’s head start on recovery, is expected to play a crucial role in shaping the country’s new reality.

Out of more than 600 respondents from Viet Nam, 47 per cent expressed a belief that the economy will rebound within two to three months and will then grow at a similar or even faster rate than before the pandemic.

It found that about 70 per cent of respondents expect to be more careful with their spending, and about half of respondents say they feel less job or financial security because of COVID-19. This is linked to decreased spending expectations across all categories, except for “essentials” such as groceries, food delivery and telecommunications services.

People also have a growing preference for healthy and locally sourced offerings. More than four in five Vietnamese respondents (81 per cent) shared that they are more focused on health. This is reflected by an increase in consumption of products that are perceived to be healthy such as eggs, fresh foods and healthcare products.

Vietnamese are fairly loyal to stores, but significantly less loyal to brands in a pandemic as 39 per cent of respondents have tried or switched to an alternative store.

The top three reasons for switching including location closer to home (46 per cent of switchers), availability of online or app-based channels (42 per cent) and stock of essentials (37 per cent).

However, 75 per cent of Vietnamese respondents have switched brands during COVID-19, and these changes are expected to last beyond the pandemic.

Looking at the sentiments of Vietnamese consumers, it is clear their optimism in the country’s recovery has influence over consumer spending, which will be pivotal in rejuvenating its economy.

This creates the potential for a self-fulfilling prophecy. If this is the case, Viet Nam will be well-positioned to emerge stronger, economically and socially, in a post COVID-19 world.