PM calls for sustainable development of wood processing industry

Last year, Vietnam earned 9.38 billion USD from exporting wood and non-wood forest products

Prime Minister Nguyen Xuan Phuc on March 28 issued a Directive on measures to achieve rapid and sustainable development of the wood and non-wood forest product processing industry to serve exports.

Wood and non-wood forest products are ranked the sixth most important export product of Vietnam and had average annual growth rate of 13 percent during 2010-2018.

Last year, Vietnam earned 9.38 billion USD from exporting wood and non-wood forest products, up 15.9 percent against the previous year and making up almost a quarter of the agriculture sector’s export turnover.

Vietnamese wood products have been sold to more than 120 nations and territories. The country is the fifth largest exporter of wood in the world and second in Asia, accounting for 6 percent of the world’s market share.

The country now has about 4,500 wood processing and forestry businesses, and 1 million households involved in afforestation. Therefore, developing the wood and non-wood forest product processing industry will boost afforestation and environmental protection, create sustainable livelihoods and contribute to the forestry sector’s restructuring programme.

However, the sector faces various challenges, including international trade conflicts, regular changes and adjustments in policies of material exporters and wood and non-wood forest product importers. Investment in developing national brands of wood products has been limited, while Vietnam’s participation in free trade agreements and international treaties offers not only opportunities, but also challenges for the sector.

Therefore, in the directive, PM Phuc asked businesses to use legal materials, apply advanced technologies and modern equipment in processing, and ensure environment-related requirements in production.

The sector is striving to achieve 11 billion USD in wood and non-wood forest product product exports in 2019, 12-13 billion USD in 2020, and 18-20 billion USD by 2025.

Trade with Southeast Asian markets boosted

Vo Tan Thanh, vice president of the Vietnam Chamber of Commerce and Industry, speaks at the Southeast Asia Outbound Investment Forum in HCM City on March 28

Vietnamese companies should further invest in and trade with Myanmar, Thailand, Laos, and Cambodia, which are members of the Association of Southeast Asian Nations, heard a forum in Ho Chi Minh City on March 28.

According to Vo Tan Thanh, Vice President of the Vietnam Chamber of Commerce and Industry (VCCI), Thailand is Vietnam’s largest trading partner among ASEAN countries, with bilateral trade reaching over 17.5 billion VND in 2018, a year-on-year increase of 15 percent.

Vietnam’s trade with Cambodia, Laos and Myanmar also grew in 2018, he said at the Southeast Asia Outbound Investment Forum.

Vietnam ran a trade deficit with Thailand because it imported a lot of machinery and equipment, raw materials for domestic production and automobiles, he said.

In 2018, Thailand was the biggest source of automobiles for Vietnam, he added.

Vietnam’s exports to these markets include mobile phones and components, computers, electronic products and components, iron and steel, machinery and equipment, vehicles and spare parts, garment and textile products, crude oil, and gasoline.

As of last year, Thailand was the ninth largest investor in Vietnam out of 130 countries and territories with 10.5 billion USD in 528 projects.

Laos ranked 52nd with 70 million USD, Cambodia was 56th with over 64 million USD and Myanmar, 99th with one project worth 800,000 USD.

Vietnamese companies have invested in all these countries, including nearly 26 million USD in Thailand.

They have invested over 3 billion USD in Cambodia to make the country among the five largest foreign investors in there.

Vietnam was the seventh largest foreign investor in Myanmar with nearly 2 billion USD in 70 projects.

Investment and trade ties between Vietnam and these countries remain short of their potential and they are making efforts to set this right.

Vietnam and Thailand for instance have set a target of increasing their trade to 20 billion USD by 2020, while Vietnam and Laos target 10 percent growth in trade this year.

To provide local companies seeking to expand operations in Southeast Asia with more information about these markets, VCCI in collaboration with Tilleke & Gibbins, a leading Southeast Asian law firm, held the first Southeast Asia Outbound Investment Forum.

2019 Food Hotel Vietnam attracts 630 local, foreign exhibitors

A press briefing to introduce the 2019 Food & Hotel Vietnam expo to be held from April 24 to 26 at the Saigon Exhibition and Convention Centre in HCM City 

The 2019 Food & Hotel Vietnam, the country’s leading international food and hospitality trade exhibition, will offer businesses the opportunity to network and keep abreast of the latest industry culinary and hospitality trends and product innovations.

The 10th edition of the event will be the largest so far and feature more than 630 local and international exhibitors from 29 countries and territories, said BT Tee, general manager of UBM VES, the event’s organiser.

It would also feature 20 international group pavilions, including Ireland, Poland, Germany, the Republic of Korea, the US, Spain, Turkey, and China, he said.

It will showcase a wide range of food and beverage products, dairy products, poultry meat, equipment for making confectionery, and equipment and services for the food and hospitality industry.

In addition to displaying the latest products and services in the food and hotel sectors, the expo will also include the 2019 Vietnam Culinary Challenge, a short-term barista training workshop, and the barista and coffee experience programme.

The Vietnam Hospitality Managing Director Forum – CEO Talks titled “Riding the wellness wave” will be held on the sidelines of the event to discuss new investment trends in the hospitality industry.

According to experts, Vietnam’s strong economic growth, large population and rising incomes make the food and beverage sectors appealing to investors.

With the tourism industry in robust health, the number of foreign visitors keeps rising, increasing demand for hospitality and food equipment and services, they said.  

Food & Hotel Vietnam will be held from April 24 to 26 at the Saigon Exhibition and Convention Centre in HCM City.

DPRK woos Vietnamese tourists after Hanoi summit

Ham Jin (centre) from Korea International Travel Company introduces his country's tourism to Vietnamese media

Tourism officials of the Democratic People’s Republic of Korea (DPRK) have urged Vietnamese travellers to seize the golden opportunity to visit the country following a summit between DPRK leader Kim Jong-un and US President Donald Trump in Hanoi last month. 

Ham Jin from Korea International Travel Company (KITC) said it is prime time for Vietnamese tourists to visit the DPRK. 

He said that following the Hanoi summit, this is a golden chance to generate a tourist market for Vietnamese who wish to tour the Northeast Asian country.

The KITC is hosting a booth at the ongoing Vietnam International Travel Mart in Hanoi - with brochures advertising a dolphinarium, a science and technology complex and a war museum in Pyongyang, as well as the Masikryong mountain skiing resort.

The DPRK receives an estimated 100,000 foreign tourists a year. However, the KITC puts the number at double that and said visitor numbers grew by as much as 50 percent last year.

The country is currently building a sprawling seaside resort known as the Wonsan-Kalma Coastal Tourist Area in a zone that has previously been used for artillery drills and ballistic missile launches.

After the Hanoi summit, President Trump has heralded the DPRK’s economic potential, praising its great beaches that he said would make ideal locations for tourists.

Construction of first aerospace component factory started

The construction of Vietnam's first aerospace component factory in Da Nang city begins on March 29 

The Universal Alloys Corporation ASIA PTE., LTD (UAC) and the People’s Committee of the central city of Da Nang on March 29 started the construction of an aerospace component factory in the city.

The Sunshine factory, the first of its kind in Vietnam, has a registered investment of 170 million USD and aims to produce and install aerospace components from aluminum alloys and composite in service of the industry. It will turn out about 4,000 out of the 5 million aircraft components, all for export.

The factory is scheduled to achieve an export value of 25 million USD in 2021, about 85 million USD a year later and over 180 million USD annually after 2026.

To operate the factory, the UAC will employ about 1,200 high-quality workers in the fields of mechanics, automation and electricity. Besides, it will develop a chain of satellite enterprises, thus indirectly creating jobs for another 2,000 workhands.

Speaking at the ceremony to start the construction, UAC CEO Kevin Loebbaka expressed his hope that the Da Nang factory will develop unceasingly and play an important role in the strategy of providing components to its partners worldwide.

The factory is scheduled to complete its first phase in January 2020 and turn out its first product in June the same year.

Vietnam int’l trade fair to take place next month

Vietnam Expo 2019 to be held in Hanoi from April 10-13 

The Vietnam International Trade Fair for this year, the Vietnam Expo 2019, will be held in Hanoi from April 10-13, organisers said on March 29.

This is a chance for companies to seek partners in various product groups such as plastics, rubber, paper, construction materials and industrial components. It is also where they can popularise and raise the value of the trademarks of made-in-Vietnam products so as to develop the domestic market.

Organisers further said participating companies will get consultation from a Republic of Korea design promotion institute, the country’s Ministry of Trade, Industry and Energy and Vietnam’s Ministry of Industry and Trade on designs, market surveys and logo development.

The expo will remain open from 9am to 6pm at 91 Tran Hung Dao Street, Hanoi’s Hoan Kiem district.

HCM City moves to become energy efficient

Solar panels are installed on the roof of the Nguyen Dinh Chieu high school for students with disabilities in HCM City 

By taking various measures, Ho Chi Minh City aims to save 1.5 – 2 percent of commercial electricity output each year as from 2019.

The municipal People’s Committee said the city hopes to save at least 10 percent of the annual electricity cost at agencies and organisations while big power consuming businesses will save at least 1 percent of the electricity used for each product unit compared to last year.

Among the planned measures, HCM City will replace normal decorative and lighting lights with energy-efficient ones, carry out energy-saving solutions at all new public lighting facilities, and pilot replacing compact light bulbs with LED lamps.

It is also encouraging local households and service providers to save electricity by using energy-efficient devices, switching off unnecessary electrical devices, making use of natural light and ventilation, and reducing the use of electricity-intensive appliances during peak times.

The HCM City Power Corporation, a subsidiary of the Vietnam Electricity (EVN) group, has also worked with organisations and local authorities to conduct communications activities at residential areas.

The corporation said in 2018, more than 727,000 local households engaged in the power saving programme, saving nearly 400 million kWh of electricity worth some 800 billion VND (34.5 million USD) and cutting down the emission of 322,000 tonnes of CO2.

As of the beginning of 2019, nearly 1,000 households, agencies and businesses in HCM City had installed solar panels on their roofs with the total capacity of 11,382kWp.

UK chartered accountants forecast slower SE Asia growth

GDP growth in Asia forecasted by ICAEW

 Cooling export growth will impact Southeast Asia, pulling down the region’s economic growth to 4.8 per cent this year from 5.1 per cent in 2018, the Institute of Chartered Accountants in England and Wales has forecast.

In a report, “Economic Insight: South-East Asia”, it said growth would further ease to 4.7 per cent in 2020.

Export growth would decelerate amid increased trade protectionism and slower Chinese demand.

Vietnamese growth was forecast to slow down to 6.7 per cent this year and 6.2 per cent in 2020.

Economies started the year on a soft note as a result of the weakness in global economic activity in late 2018, and regional merchandise exports growth tumbled last December following a weak November.

The deterioration in export momentum was broad-based, with only Malaysia recording positive annual growth. While Singapore and China data showed some improvement in exports in January, the data was likely to be volatile in the first quarter given the timing of Chinese New Year.

Sian Fenner, ICAEW economic advisor and Oxford Economics lead Asia economist, said: “Looking ahead, we expect the risks to the economic outlook of the region to be primarily to the downside. A sharper slowdown in Chinese economic growth, triggered by worsening confidence or a renewed escalation in US-China trade tensions, will both affect global trade and growth across the region.

“That said, we do not expect the external environment to be as worrisome as it was in 2015-16, as China’s growth is also expected to stabilise in the second quarter.”

The report expected domestic demand to provide some relief together with accommodative macro policies.

“Most central banks are likely to keep policy rates unchanged well into the second half of 2019 amid muted inflationary pressures. Expansionary fiscal policy will also help, with fiscal spending expected to be strong in Indonesia, Thailand and the Philippines ahead of upcoming elections in first half of 2019.”

There were pockets of concern, however, with regard to investment growth in certain countries. In Singapore and Malaysia, private capital expenditure, especially in machinery and equipment investment, had been on a downward trend.

Residential investment would also be held back by demand and supply imbalances in both those economies.

On a more positive note, construction, particularly infrastructure investment, was expected to limit the downside to overall investment.

Benign inflationary conditions and rising real income growth would also continue to support household spending.

Mark Billington, ICAEW regional director, Southeast Asia, said: “Although we expect domestic demand to remain resilient, the impact of increased trade tensions in the past year and slower Chinese import demand is likely to act as a drag on the region’s growth as a whole.

“The outlook for Asia trade may continue to face a challenging export environment.” 

Vietnamese seafood exporters urged to go digital

Participants at a meeting in HCM City on Thursday discuss the importance of exporting Vietnamese seafood to China through official channels. 

 Vietnamese companies should export seafood and other farm produce via e-commerce to China to meet the market’s increasing demand for high-quality goods, experts have recommended.

Speaking at a meeting held yesterday in HCM City, Cao Lam Vien, vice chairman of the HCM City Business Association of High-Quality Vietnamese Products, said that purchasing power in China had risen dramatically, with average income last year reaching nearly US$10,000 per person.

In big cities like Beijing and Tianjin, the average income is up to $20,000 per person per year.

Truong Dinh Hoe, secretary general of Viet Nam Association of Seafood Exporters and Producers (VASEP), said China was now a major seafood import market with diverse needs and higher quality requirements. “They prefer imported products and naturally caught products.”

China is currently reducing aquaculture production due to environmental issues, and is lowering import tariffs for officially exported Vietnamese seafood.

Vien said that bilateral trade between the two countries had been conducted mostly through unofficial cross-border transactions over the past 30 years.

However, unofficial exports over the border to China are facing technical barriers since the two nations have agreed to limit them and increase official exports.

Unofficial exports could be risky in terms of payments as well as quality and quantity of goods, he said, adding that China had tightened quality norms and origin traceability.

Viet Nam’s farm produce exports to China have faced stiff competition from other exporting countries in terms of quality, price and branding.

Vietnamese enterprises must also conform to new Chinese requirements for quality and traceability as well as Chinese regulations and standards on packaging and labeling, in addition to improving added value, Vien noted.

China is the world’s largest importer of agricultural products, accounting for 10 per cent of global imports, and its imports are growing at 8.8 per cent annually.

It accounted for 70 per cent of Viet Nam’s agricultural exports last year.

According to the General Department of Customs, Viet Nam exports about $1.2-1.3 billion worth of seafood to China each year.

Viet Nam is China’s third largest seafood exporter, while China is Viet Nam’s fourth largest seafood export market. 

Vietnamese companies urged to go to Southeast Asian markets

Vo Tan Thanh, vice president of the Viet Nam Chamber of Commerce and Industry, speaks at the Southeast Asia Outbound Investment Forum in HCM City on March 28. 

 Vietnamese companies should further invest in and trade with ASEAN member countries like Myanmar, Thailand, Laos, and Cambodia, a forum heard in HCM City on Thursday.

Vo Tan Thanh, vice president of the Viet Nam Chamber of Commerce and Industry (VCCI), told the Southeast Asia Outbound Investment Forum, “Thailand is Viet Nam’s largest trading partner among ASEAN countries, with bilateral trade reaching over US$17.5 billion last year, a year-on-year increase of 15 per cent.

“Viet Nam’s trade with Cambodia, Laos and Myanmar also grew last year.”

Viet Nam had a trade deficit with Thailand because it imported a lot of machinery and equipment, raw materials for domestic production and automobiles, he said.

In 2018, Thailand was the biggest source of automobiles for Viet Nam, he added.

Viet Nam’s exports to these markets include mobile phones and components, computers, electronic products and components, iron and steel, machinery and equipment, vehicles and spare parts, garment and textile products, crude oil, and gasoline.

As of last year, Thailand was the ninth largest investor in Viet Nam out of 130 countries and territories with $10.5 billion in 528 projects.

Laos ranked 52nd with $70 million, Cambodia was 56th with over $64 million and Myanmar, 99th with one project worth $800,000.

Vietnamese companies have invested in all these countries, including nearly $26 million in Thailand.

They have invested over $3 billion in Cambodia to make the country among the five largest foreign investors in there.

Viet Nam was the seventh largest foreign investor in Myanmar with nearly $2 billion in 70 projects.

Investment and trade ties between Viet Nam and these countries remain short of their potential and they are making efforts to set this right.

Viet Nam and Thailand for instance have set a target of increasing their trade to $20 billion by 2020, while Viet Nam and Laos target 10 per cent growth in trade this year.

To provide local companies seeking to expand operations in Southeast Asia with more information about these markets, VCCI in collaboration with Tilleke & Gibbins, a leading Southeast Asian law firm, held the first Southeast Asia Outbound Investment Forum, Thanh said.

Thomas Treutler, partner and managing director of Tilleke & Gibbins (Viet Nam), said many foreign investors are coming to Viet Nam because of the good quality of its products and services, skill of its workforce and the competence of its companies.

So there is no reason why these companies cannot go abroad and compete successfully there, he said.

“Many Vietnamese companies have succeeded overseas and that can be replicated further.”

He said companies should pay more attention to protecting their brands abroad.

Tilleke & Gibbins’ lawyers from its Cambodia, Laos, Myanmar, and Thailand offices spoke to attendees about market entry in their respective jurisdictions, the process and legal framework for doing business there and the market opportunities and challenges in each country. 

Lao Cai inaugurates copper plant

Representatives cut the ribbon to inaugurate the copper plant.

 The Viet Nam National Coal – Mineral Industries Holding Corporation Limited (Vinacomin) on Wednesday inaugurated the copper plant No 2 at Sin Quyen copper complex in the northern province of Lao Cai.

The plant has an investment capital of more than VND2.56 trillion (US$110 million) and is aimed at improving the capacity of Sin Quyen copper complex.

With a designed capacity of 44,200 tonnes of copper ore each year, the plant is expected to supply enough materials to meet the needs of local refining companies.

Since it started commercial operations in January this year, the plant has mined more than 3,300 tonnes of copper ore, ensuring sufficient supply of raw materials for copper factories in Lao Cai.

The plant has already created hundreds of jobs and stable income for local residents. It is expected to contribute VND500-600 billion per year to the provincial budget.

Speaking at the ceremony, Deputy Prime Minister Trinh Dinh Dung stressed the need for effective management and exploitation of minerals to develop the economy while ensuring national security and protecting the environment.

The Deputy PM asked the province to continue supporting mineral projects, especially in compensation, land clearance and resettlement work.

It should join hands with competent agencies to map local mineral reserves and zone off areas with potential for natural resource development, he said.

Dung hailed Vinacomin’s efforts in overcoming challenges to develop production and business and ensure national power security. He ordered the group to accelerate its projects, particularly the Lao Cai copper refining plant, to bring the total refining capacity to 30,000 tonnes by the end of 2020.

He said Vinacomin should apply advanced technologies in production and pay due attention to environmental protection, labour safety, development of essential infrastructure and improvement of local livelihoods.

Japan-style resort tourism site built in Da Nang

At the ceremony to begin the construction 

Xuan Thieu tourism investment JSC and Mikazuki Group of Japan began construction to expand the Xuan Thieu tourism site in Lien Chieu district, the central city of Da Nang on March 28. 

The 100-million-USD project covers an area of 12.23 ha along the Nguyen Tat Thanh coastal road. 

As a Japan-style resort area in Da Nang, the site will consist of a hot spring and water park area, the first dome entertainment area in Da Nang, and sea view restaurant, and hotels. 

Yoshimune Odaka, General Director of Mikazuki Group, said his firm selected Da Nang to invest in due to its beautiful beaches, adding that the company wants to create a Japanese-style resort tourism site in the coastal central city. 

Vice Chairman of the municipal People’s Committee Le Trung Chinh said the locality aims to attract more investment in 2019, noting that the project is hoped to contribute to promoting socio-economic development in the city and enhancing cultural connections between Da Nang, and Vietnam in general, with Japan. 

As scheduled, the first phase of the project will be completed and put into operation in June 2020. The project will fully become operational in April 2021.

Vietnam urged to reduce logistics costs to enhance competitiveness

The World Bank made public a report on improving Vietnam’s land transport and a strategy on sustainable development of inland waterway transport in the country at a workshop in Hanoi on March 28. 

Yin Yin Lam, a senior transport expert of the WB, said land transport is the backbone of the cargo transport system in Vietnam, citing figures that land transport accounts for 77 percent of total cargo transport in the country.

She noted that logistics costs in Vietnam made up nearly 21 percent of the national GDP, which is higher than the ratio in most other countries in the Association of Southeast Asian Nations (ASEAN). This affects the country’s competitiveness in export and increases costs for both producers and consumers, she said.

While taking note of improvements in Vietnam’s logistics sector, as the country rose from the 64th place in 2016 to the 39th place in 2018 in the WB’s Logistics Performance Index, the expert said logistics costs remain high.

In order to enhance the efficiency of land transport, Yin Yin Lam urged the country invest more in infrastructure to reduce traffic jams, promote the use of barge for container transport and further develop coastal shipping along the north-south route.

The expert also urged transport firms to modernise their fleets and standardise the procedures for driver training and issuance of driving licences.

According to the WB representative, the WB has committed 3.8 billion USD in total to Vietnam’s transport sector since 1993. The money was spent on building new roads, or to maintaining and upgrading existing routes.

Regarding the inland waterway system, the WB expert said poor infrastructure has hindered the system’s development, such as ports with outdated facilities and poor connectivity with other modes of transport.

The WB recommended that the transport sector call for investment from the private sector in the system of ports, while the state budget should focus on transport infrastructure.

Thailand holds MICE Roadshow in Ho Chi Minh City

The Thailand Convention & Exhibition Bureau (TCEB) organized a MICE Roadshow Thailand 2019 in Ho Chi Minh City on March 28, one of activities to promote the organization of MICE events in Thailand.

Nichapa Yoswee, Senior Vice President of the TCEB, said the Roadshow Thailand 2019 is an affirmation of the TCEB’s commitments to stepping up cooperation between Vietnam and Thailand in developing MICE (meetings, incentives, conferences, and exhibitions) industry.

UP to 55,306 Vietnamese came to Thailand for MICE events in 2018, making a growth rate of 109 percent, and turning Vietnam into one of leading MICE markets of Thailand.

According to the Global Association of the Exhibition Industry (UFI), Thailand is not only a growing business destination but also a central foundation for exhibitions in ASEAN.

Thailand is the leading destination for meetings and incentives (MI) in the region, recording the growth rate of 35.9 percent in foreign MI travelers in 2018, the highest rate in 14 years.

The TCEB has been Thailand’s official government agency supporting, promoting and developing global and regional business events, (MICE) in Thailand since 2004. As a strategic partners and sanctioned liaison, TCEB co-creates successful solutions with companies and organizations to realize MICE events of every scale and type.

Financial-monetary advisory council meets to assess growth

The meeting of the National Advisory Council on Financial and Monetary Policies on March 28 

The National Advisory Council on Financial and Monetary Policies met on March 28 to assess the economic growth in Quarter 1 and determine factors that can affect growth in the remaining months of the year, including obstacles in the banking and financial sectors.

A report of the State Bank of Vietnam (SBV) showed domestic demand stayed stable in the first three months of the year, and consumption and foreign direct investment (FDI) maintained a good growth compared to the same period last year. Newly-registered and additional FDI capital rose by 82.6 percent while FDI disbursement picked up 6.2 percent on a yearly basis. 

However, export growth has slowed down remarkably, with a 5.4 percent increase this year to March 15 compared to 26.5 percent in the same period last year, according to statistics of the General Department of Vietnam Customs. Low increases in the export of farm produce, aquatic products, minerals, and phone-electronics-computers and parts have affected the growth of industrial production.

The SBV estimated the GDP growth rate in the first quarter at 6.3-6.5 percent, which is lower than the unprecedented level of 7.45 percent in Quarter 1 last year but still higher than the Q1 figures of other years since 2009. 

Deputy Minister of Industry and Trade Tran Quoc Khanh said the growth in foreign trade value is lower than expectation, estimated at 4.7 percent. However, he was still confident that the targets set by the National Assembly could be achieved as there is big room for growth in such sectors as steel, automobile, thermal energy, leather-footwear, textile-garment and agro-forestry-fisheries. The targets set for this year included a 9-10 percent growth in industrial production and 8-10 percent growth in exports.

The advisory council’s members shared the view that the domestic economy has remained stable, and there is no need to revise solutions specified in the Government’s Resolution 01 on key tasks and measures to carry out the socio-economic development plan and state budget estimate. They said ministries and sectors have run proactive and flexible monetary policies in close coordination with fiscal policies and others to keep inflation stable, contributing to stabilizing the macro economy and supporting economic growth. 

They agreed that the currency’s value and the inter-bank interest rate have been kept stable, and total means of payment went up 2.67 percent compared to the end of 2018, thus helping control inflation. 

The council’s members recommended pushing ahead with measures specified in the Government’s Resolutions 01 and 02 while keeping watch of developments in the domestic and world situations for timely adjustments. 

Many members suggested that the Government work to remove bottlenecks in the Law on Planning and early complete the adjustment of the Law on Public Investment. 

The council also urged the Government to accelerate the disbursement of public investment, especially for big-scale and major projects.

CPI growth in first quarter lowest in three years

Deputy Prime Minister Vuong Dinh Hue (standing) speaks at the meeting of the steering committee on price management on March 28 

The consumer price index (CPI) in March fell 0.21 percent from the same period in 2018, helping the average CPI in the first quarter stay at a three-year low of 2.63 percent year-on-year.

As such, the CPI in March rose by only 0.69 percent from last December and 2.7 percent from the year previous.

Meanwhile, the core inflation – which is the CPI excluding food items, energy products, and state-managed commodities such as healthcare and educational services – dropped 0.06 percent in March against the last month. It increased 1.84 percent in Q1 compared to the same period of 2018.

At a meeting on March 28, the steering committee on price management said price fluctuations in Q1 matched forecasts as they rose slightly in January, surged in February, and declined slightly in March, reflecting normal developments in the market that typically see prices soar in the month of the Lunar New Year festival and return back to usual following.

The retail price of electricity was raised by 8.36 percent on average, equivalent to 144 VND per kWh, on March 20 after a long period of being kept unchanged. This hike only contributed 0.33 percent to the CPI growth in March, which had a minor impact.

Facing the sharp increase of global petrol prices, the Ministry of Finance and the Ministry of Industry and Trade boosted the spending of the petrol price stabilisation fund in March to keep domestic prices stable, helping to ease the power price hike’s impact on the CPI.

Deputy Prime Minister Vuong Dinh Hue applauded the close coordination among ministries and sectors in price management, which has been conducted in an active manner matching the market’s supply-demand situation.

He noted that with ministries and sectors’ activeness, close coordination, alignment of prices with fluctuations in the market, and information transparency, the target of keeping this year’s inflation between 3.3-3.9 percent is within reach.

Vietnam Rubber Group taps 25,400 tonnes of latex in Cambodian province in 2018

The Vietnam Rubber Group (VRG) has reported that it tapped over 25,400 tonnes of rubber latex from its farms on a total area of 22.64ha in the Cambodian province of Kampong Thom in 2018. 

During a ceremony reviewing the VRG’s rubber tree planting project in the province on March 27, the group said its eight subsidiaries operating in Kampong Thom sold 25,766 tonnes of latex the same year, earning profit of more than 39.4 billion VND (1.7 million USD). 

The report said the Vietnamese rubber firms have contributed to generating jobs in the Cambodia province; building roads, schools, medical stations and water wells in the surrounding areas; and donated millions of USD to the Cambodian Red Cross. 

This year, the VRG will begin to harvest latex on some 31,000 ha of rubber trees and employ more than 6,500 workers in the country. 

Vietnamese Ambassador to Cambodia Vu Quang Minh asked provincial authorities to assist VRG in the supply of professional guards, allow the use of workers during weekends in line with Cambodia’s Labour Law, and check the legality of rubber latex points of sale near the project’s area, contributing to improving local economic growth. 

He also urged the province to provide all possible support for Vietnamese nationals in Tonle Sap, Kampong Thom province in conducting paper works to be employed by VRG.

Governor of Kampong Thom province Sok Lou pledged to deal with issues within his authority and report VRG’s proposals to leaders of Cambodian ministries and agencies concerned. 

Accordingly, Kampong Thom will hold meetings every three months with the Vietnamese rubber firms to review joint work and address any arising issues. 

RoK-funded investment information project launched

The Republic of Korea has pledged to provide Vietnam with US$5.5 million in non-refundable aid in order to upgrade the national investment information system.

This commitment was made by the Republic of Korea (RoK) side at a ceremony held in Hanoi on March 28. The event marked the launch of a project dedicated to developing the National Investment Information System (NIIS) for the private sector.

Upon addressing the event, Vu Dai Thang, Deputy Minister of Planning and Investment, thanked the Korea International Cooperation Agency (KOICA) for the aid, which is expected to make significant contributions to the country’s e-Government building and administrative reforms.

In addition, the system is hoped to help increase transparency in investment procedures, thus better serving foreign investors’ operations in Vietnam.

Thang proposed that ministries, agencies, and localities closely co-ordinate with the Ministry of Planning and Investment for the sake of the effective implementation of the project.

Kim Jin Oh, KOICA Country Director for Vietnam, said that the NIIS project is one of the RoK’s top priorities given to realizing its New Southern Policy. The policy aims to dramatically improve co-operative ties with ASEAN member countries, including Vietnam - one of the RoK’s key partners.

The non-refundable aid is projected to help Vietnam create better administrative procedures for private investments and add an online consulting feature to the system, the Korean director said.

The RoK is currently Vietnam’s largest foreign direct investment partner with the total registered capital aggregating nearly US$64 billion, as well as the latter’s third largest trading partner.

Both sides are focused on lifting the bilateral trade turnover from US$65.7 billion in 2018 to US$100 billion by 2020.

Under the RoK’s cooperation strategy with Vietnam for the 2016-20 period, the RoK has given priority to boosting bilateral partnership in four fields, including transportation, public administration, health, and education.

The NIIS project is subjective to the prioritised cooperation in public administration. It looks to develop analysis tools for foreign investors seeking investment and business opportunities in Vietnam as well as local firms in search for overseas investments.

HCM City looks to attract more Canadian investment

Canadian businesses want to do long-term business and investment activities in the southern hub, especially in fields such as education-training, high technology and waste treatment. 

HCM City’s authorities would create favourable conditions for foreign investors, including those from Canada, to invest and do business in the city, according to vice chairman of the municipal People’s Committee Lê Thanh Liêm.

The official made the statement at a reception for visiting Chairman of Canada Trade Link Bryon Wilfert on Wednesday, during which he expressed his hope that it would welcome a new wave of investment from Canadian enterprises in the near future.

He highlighted the fruitful development of Việt Nam-Canada relations, saying the relationship was in its most productive period of their 45 years of diplomatic ties, with the two countries upgrading their bilateral ties to a comprehensive partnership in November 2017.

He spoke highly of Wilfert’s visit, saying that it showed the Canadian government and business community’s active interest in promoting co-operation between the two countries.

Liêm noted Canada’s proposals on co-operation between Canadian localities and HCM City, expressing his belief that with willingness and efforts on both sides, especially the role of Canada Trade Link in business connections, the co-operation would develop strongly, positively contributing to promoting the Việt Nam-Canada comprehensive partnership.

On his behalf, Wilfert stressed that on the basis of the sound relations between the two countries, the economic, trade, and investment co-operation between the two sides had resulted in many opportunities and potential for stronger development.

The visit aims to promote trade and investment co-operation between the two countries in the context of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) taking effect.

Wilfert said Canadian businesses were impressed by the dynamic development of HCM City and that they wanted to conduct long-term business and investment activities in the southern hub, especially in fields such as education-training, high technology and waste treatment.

By the end of 2018, Canada had 80 investment projects worth US$118 million in the city.

HCM City seeks to raise efficiency of PPP model

Secretary of the HCM City Party Committee Nguyen Thien Nhan (left) talks with delegates to the seminar. (Photo: sggp.org.vn)

A perfect public-private partnership (PPP) model should harmonise the interests of State agencies, investors, beneficiaries and those affected by the project, an official of Ho Chi Minh City has said. 

Speaking at an international seminar in HCM City on March 27, Secretary of the municipal Party Committee Nguyen Thien Nhan took school and hospital projects as an example, saying as well as from students and patients, the projects musts pay attention to people affected by land clearance. 

The seminar was organised by the HCM City People’s Committee and the World Bank (WB) in Vietnam, aiming to seek strategies to increase investment under the PPP model in infrastructure, healthcare, education, solid waste and wastewater treatment, and fighting floods in the southern metropolis.  

Ousmane Dione, WB Country Director for Vietnam, stressed the need to consider the PPP model a long-term cooperation one, under which the public and private sectors share benefits and risks. 

PPP must be a cooperation model that benefits all relevant sides, he said, noting that regulations must be clear, persuading investors to accept long-term risks. 

He said the WB will help Vietnam and HCM City in particular step up the implementation of PPP projects. 

Nguyen Dang Truong, head of the Public Procurement Agency under the Ministry of Planning and Investment, said a PPP law should be developed, ensuring simple, clear and effective implementation of PPP projects, as well as international practices. 

The law also needs to prescribe investment areas, capital for projects, the Government’s guarantee and the operation of businesses concerned, he said. 

Nguyen Thanh Phong, Chairman of the municipal People’s Committee, said PPP has been seen as an optimal solution to address capital shortages in infrastructure and services, especially in localities with huge investment demands like HCM City. 

The official pointed out the small number of PPP projects in HCM City that make up only 5 percent of the locality’s total public projects, along with challenges facing the projects. 

HCM City will consolidate the existing solutions and propose new, more efficient ones effort to attract investment, he said, adding the city hopes international organisations and businesses will put their confidence  in local reform policies. 

The city is committed to creating the best possible conditions for investors who select it as a long-term investment destination, Phong said. 

Other delegates suggested HCM City invest in transport, healthcare, education and the environment to maintain its competitiveness and handle challenges caused by rapid urbanisation. 

Public investment alone is not enough to meet the locality’s increasing demands for infrastructure and services, they said, urging the city to improve the efficiency of public investment and utilise resources from the private sector, especially through the PPP model.