SMEs urged to join value chains

Better supplier-buyer relations with multinationals located in Vietnam would help small- and medium-sized enterprises (SMEs) gain access to electronics global value chains, experts have said.

Duong Thi Kim Lien, deputy director of USAID Vietnam Linkages for Small- and Medium-sized Enterprises (LinkSME) programme, said such relations would help lower costs for multinationals in Vietnam to source locally, while representing a huge opportunity to grow the country’s SME sector and build its middle class. 

Speaking at a workshop held in HCM City on October 4, Lien said the LinkSME programme improves Vietnam’s regional competitiveness by making it a more predictive investment climate.

Vietnam has had one of the world’s fastest rates of growth over the past 20 years, but its growth rates have been slowing in recent years, raising concerns that Vietnam may be falling into the middle-income trap, according to Lien. 

However, Vietnam has made raising productivity and increasing value-added production a high priority as part of its plan to modernise and grow its economy.

One way to do this is by strengthening the linkages between domestic firms and global value chains.

The purpose of the LinkSME programme will be to bring about systemic changes in business relationships between Vietnamese SMEs and multinationals in the country.

Nguyen Trong Hieu, an expert with the USAID Governance for Inclusive Growth (GIG) programme, said that 70 percent of the value of spare parts to make electronics products still comes from imports.

In addition, more than 20 percent of Vietnamese manufacturers also have financial troubles accessing loans from commercial banks, he said.

Nguyen Thi Xuan Thuy, head of the Industry Department at the Ministry of Industry and Trade, said the ministry would continue to offer preferential policies to foreign investors and encourage domestic supporting industries to help local electronics producers become more involved in global production chains.

Vietnam has moved up in the global value chain, and has become better known as a manufacturer in Asia, with four industrial sectors participating in the world’s production chains, including electronics, automobiles, agriculture and textiles, she said. 

The country, especially the electronics sector, is expected to attract more foreign direct investment (FDI) in the near future, creating more jobs for local workers as well as opportunities for suppliers of electronics.

To better integrate into global electronics value chains, Vietnam should call for investment from the private sector, and enhance communication systems, market competition and customs clearance procedures.

According to recent World Bank reports, only 300 Vietnamese firms are fully eligible to join the world’s production chains.

Nguyen Quoc Cuong, director of Hanel Plastics, said that SMEs faced hurdles when joining global supply chains because of the unstable quality of products, a problem cited by Samsung and Canon manufacturers in Vietnam.

Most SMEs do not have a system to ensure quality for all products, he said, adding enterprise leaders lack sufficient commitment and innovation.

“To become a supplier of the first level, enterprises must also ensure standards related to delivery, safety, employee morale, work environment, communications, and technology,” he said.

“The key to success is a long-term strategy with top priority being given to quality of products, skilledl human resource, professional management, and the use of cutting-edge technologies."

In recent years, the electronics industry has grown rapidly and has become one of the most important sectors of Vietnam’s economy. The growth rate rose from 7.4 percent in 2011 to 32.5 percent in 2015. 

The development of Vietnam’s electronics industry is attributed to large investments from multinationals, especially from the Republic of Korea and Japan, which manufacture electronic components.

Electronics is the largest export sector in Vietnam, with export turnover growing from 22.9 billion USD in 2012 to more than 71 billion USD in 2017.

It is now 2.5 times and five times greater than the textile and footwear sectors, respectively.

Of the total, 95 percent of the country’s electronics export turnover is due to foreign direct investment (FDI) enterprises. 

Organised by the Ministry of Industry and Trade, the workshop was held to help Vietnamese SMEs improve competitiveness and join global value chains.

AmCham Supplier Day 2018 connects domestic, foreign firms

The AmCham Supplier Day 2018 was held in Ho Chi Minh City on October 4, attracting the participation of hundreds foreign invested businesses and Vietnamese suppliers.

This was the fifth consecutive time the American Chamber of Commerce in Vietnam (AmCham Vietnam) had hosted the event, which saw a scale expansion and changes in the way of approaching among suppliers and producers to help develop global supply chains. 

At the event, Brian Mtonya senior economist at the World Bank said a lack of competitive local suppliers causes foreign firms to look elsewhere for companies that can provide consistent and timely inputs needed to finalise production.

He pointed out the reasons for market failures that have deterred the development of FDI and SME (small- and medium-sized enterprises) linkages.

In Vietnam, local suppliers lack competitiveness in terms of quantity, price and quality, while more foreign-owned firms hold internationally-recognised quality certifications.

In addition, more Vietnamese firms complain about access to finance than firms from peer countries, according to Mtonya.

The lack of a skilled workforce across sectors in Vietnam is also a problem.

Michael Trueblood, director of the economic growth and governance office for USAID/Vietnam, said SMEs face challenges integrating into global value chains.

Quantity, quality, and standard process requirements are common challenges that need to be addressed.

SMEs often start as household businesses, and later meet challenges in the regulatory environment, all of which hinder linkages to foreign firms or export markets, Trueblood said.

The USAID mission goals related to economic growth will help Vietnam’s continued transformation by strengthening the SME – Foreign Firm business linkage framework, he said.

The new project, called Linkages for Small and Medium Enterprises (LinkSME), will enhance Vientamese SME’s capability to participate in global value chains in five sectors.

The 22 million USD five-year project, which began in September, will improve and expand the supplier-buyer relationships between Vietnamese and foreign firms, according to Trueblood.

Ninety local suppliers and 68 FDI manufacturers of different industries took part in the fifth annual event organised by the American Chamber of Commerce, featuring an exhibition of 70 booths for manufacturers of various industries.

Participating manufacturers and suppliers received information from the World Bank, Vietnam Chamber of Commerce and Industry, USAID, WeConnect and Arizona State University at workshops held during the event.

Lam Dong promises to be ideal land for Thai investors, tourists

The Central Highlands province of Lam Dong promoted itself as a promising land for investment, trade and tourism at a conference held in Bangkok, Thailand, on October 4.

The event attracted representatives of the Tourism Authority of Thailand, the Board of Investment of Thailand, the Board of Trade of Thailand, the Thai Chamber of Commerce, the Federation of Thai Industries, the Thailand – Vietnam Business Council, and the Thai Small- and Medium-sized Enterprises Council. More than 300 Thai businesses and investors also attended the conference.

Vietnamese Ambassador to Thailand Nguyen Hai Bang emphasised that the two countries now boast the best ever political and economic relations. They have signed many agreements creating legal frameworks for business, investment and trade activities. The two Governments are also making efforts to enhance their economies’ connectivity.

With favourable geographical, political and economic conditions between the two sides, Thai firms have operated profitably and invested in many strategic sectors of Vietnam’s economy, from petrochemistry to retail.

He added Lam Dong owns specific geographical, economic and cultural advantages and also has a flight route linking its Da Lat city with Bangkok. It will surely be a good destination for Thai investment and tourists in the central region of Vietnam.

Vice Chairman of the provincial People’s Committee Nguyen Van Yen said local economy has developed continually over the past years. In 2017, Lam Dong recorded an economic growth rate of 8.16 percent and export revenue of 552 million USD. It also welcomed 5.9 million tourist arrivals.

However, the province’s economic development has yet to match potential and advantages due to limitations in capital, technological application, production scale and markets, as well as businesses’ modest connectivity and integration capacity, he said.

The official stressed that Lam Dong pledges to support enterprises and continually work to build an open, transparent and friendly investment climate. It is also ready to remove obstacles facing companies in a timely manner so as to facilitate investors’ activities.

This is the first time an investment, trade and tourism promotion event of Lam Dong has been held in Bangkok. The conference was a chance for the provincial administration to talk face-to-face with investors and for investors and businesses to seek partnerships, thus popularising Lam Dong’s images among Thai partners.

As one of the five Central Highlands provinces, Lam Dong is located about 800 - 100 metres above the sea level. While the special soil condition has created optimal conditions for the province to develop agriculture and tourism, the favourable geographical location has helped it to gain close socio-economic relations with neighbouring localities.

Da Lat, the capital city of Lam Dong, is also one of the most well-known tourist destinations in Vietnam, attracting millions of tourists each year.

Economic outlook for 2019 to see positive signs

The Ministry of Planning and Investment has painted a rosy picture of the national economy in 2019 with GDP growth expected to grow at 6.6%-6.8% compared to 2018 and average consumer price index (CPI) at 4-5%.

Exports is predicted to surge by 7-8% to US$256 billion over 2018 and imports   up 10% to US$261 billion. Trade deficit is estimated at US$5 billion, making up below 3% of total export revenue.

However, the MPI has pointed out some risks and challenges facing Vietnam’s economy in 2019, driven by the negative impacts of trade wars among major economies along with the risks of geopolitics and an upward trend of trade protectionism.

There will be challenges from the national economy’s inner factors such as low technological development, gradually depleted natural resources and, different development gaps between the private and FDI sectors, especially exports and imports.

According to the MPI, the Vietnamese economy in 2019 and 2020 will signal positive signs with macroeconomic stability and higher confidence in investment environment.

The MPI put forth several objectives and major solutions for 2019, with a particular focus on improving the macro-economy, consistently keeping a check on inflation, improving the investment climate and stimulating GDP growth.

It is imperative to carry out three strategic breakthroughs: Firstly, restructuring the economy in association with renovations in the growth model: Secondly, to improve the quality of growth and labour productivity, and thirdly to enhance the economy’s competitive edge based on the set targets in the face of the fourth industrial revolution 4.0.

More than 20.8 million shares of Phục Hưng Holdings Joint Stock Company were officially listed on the HCM City Stock Exchange on Wednesday. The shares, coded PHC, will be traded from a starting price of VNĐ15,000 (US$0.64) with total listing value of VNĐ208 billion.

The firm has seen high revenue growth from VNĐ1.46 trillion in 2016 to VNĐ2.1 trillion in 2017.

The company earned revenue of over VNĐ1.3 trillion in the first half of the year which was equivalent to 90 per cent of the whole of 2016 and 62 per cent of the whole of 2017.

After-tax profit in the six month period rose by 2.2 times from the same period last year to reach VNĐ28 billion, meeting 48 per cent of the set targets. Earnings per share (EPS) in the period was VNĐ1,337 per share.

Established in 2001, Phục Hưng Holdings is a member of Việt Nam Construction and Commercial Investment Corporation (Constrexim Holdings).

PHC shares were first traded on HNX with charter capital of VNĐ30 billion in 2009.

In 2010, the company decided to separate from its parent company – Constrexim Holdings.

It has become a general contractor of more than VNĐ1.3 trillion worth of projects, such as CT1 Gamuda, Block C, D, K from Kenton Note and other projects. It was named as one of top 10 most prestigious contractors in Việt Nam in 2018 by Viet Nam Report.

By the end of September, the company’s charter capital reached VNĐ210 billion and total assets of VNĐ1.9 trillion.

The company has always focused on its key sector as revenue from construction accounts for over 90 per cent of its total revenue.

It is expected to sign VNĐ3 trillion and VNĐ3.6 trillion for construction projects in 2018 and 2019 respectively. 

PetroVietnam enjoys thriving business thanks to crude oil price hike

All the financial targets of the Vietnam National Oil and Gas Group (PetroVietnam) in the past nine months surpassed the plan thanks to the improvement in the price of crude oil, according to insiders.

The firm reported that the average crude oil price in the first nine months of 2018 was 74.6 USD per barrel, 24.6 USD higher than the expectation and representing a rise of 37 percent over the same period in 2017.

Therefore, the total revenue of the firm in the first nine months of 2018 hit 449.1 trillion VND (19.31 billion USD), up 20 percent compared to the plan. It paid 81.4 trillion VND to the State budget in the nine months, surpassing its target for the period by 52.1 percent and for the yearly target by 10.4 percent.

All of its member companies maintained normal production, while the majority of its production goals also exceeded the plan by 2-15 percent.

Total production reached 18.17 million tonnes, 5.9 percent, or 450,000 tonnes, higher than the plan. Meanwhile, its gas production was 7.61 billion cubic metres, and electricity output was 16.03 billion kWh. Its nitrogen production in nine months hit 1.23 million tonnes, while petrol output was 6.5 million tonnes.

PetroVietnam is striving to expand its oil and gas exploration to increase its reserve for the nine months to 6 million tonnes equivalent of oil.

Mekong Delta to invest in agri-tourism

The authorities in the Mekong Delta Region are seeking ways to develop tourism based on agricultural products and services.  

A workshop on improving the efficiency of agricultural tourism in the Mekong Delta was also opened on October 1 by the Vietnam National Administration of Tourism, the Central Coordination Office for New Villages and An Giang Province People's Committee to discuss the problem.

Phan Dinh Hue, the representative of Circle Travel Services Vietnam Company, said foreign tourists often want to experience homestays and rice fields in the Mekong Delta. The number of tourists is rising annually and their spending has become one of the main revenues of Tien Giang, Vinh Long, Ben Tre provinces and Can Tho City. New and improved products will definitely attract more tourists and boost the staying time.

Domestic tourists are mostly wealthy visitors from HCM City and its eastern provinces. As cars have become much easier to acquire and new highways have been opened, they are also potential customers for Mekong Delta tourism.

However, the services and products are still very basic.

Nguyen Trong Minh from Viet Mekong Company said the tourism services in the wetlands of Dong Thap Muoi should be developed based on organic farming since this area is associated with historical reclamation activities. Minh suggested that the authorities should assists firms with bank loans, land, human resource training, and regulations on copyright protection of agricultural tourism products.

"If we don't do anything now we'll be left behind and lose many opportunities," Minh said.

Pham The Trieu, deputy director of the Department of Culture, Sports and Tourism in An Giang, said they were one of the first provinces that started investing in agri-tourism since 2007 with support from Dutch co-operatives and Agripool network, Agriterra.

About 600 farmers were trained and nearly 100 households were given material assistance. Since then, their monthly incomes have increased by VND5m (USD216) to VND12m. Trieu has asked related agencies to help develop special services and call for investments.

"Prioritising agri-tourism is the way to boost the region's development speed. The Mekong Delta must prioritise agri-tourism as their key sector then co-operates with other provinces to design bigger tours," he said.

Personnel training – key to marine economy sustainably

Human resources development has been seen as the key to developing the marine economy sustainably as well as managing, using and protecting maritime resources in Vietnam, as these sectors require a large and skilled labour force. 

However, Vietnam faces a shortage of manpower, with low quality and an imbalanced labour structure, according to the Vietnam Administration of Seas and Islands. 

Additionally, managers lack professional skills and the number and quality of researchers has remained limited. Therefore, marine scientific and technological outcomes have failed to meet expectations. 

Given this, over the past ten years, Vietnam has paid attention to human resources development in maritime affairs. 

Deputy Minister of Natural Resources and Environment Tran Quy Kien said ministries and localities have focused personnel training on oil and gas, navigation, fishery and tourism. 

He stressed the need to establish maritime training and research institutes in coastal cities, along with education and health establishments and houses for officials working in coastal and island areas. 

The Ministry of Education and Training has also reviewed its training programme in service of the sea-based economy, and helped educational institutions launch suitable programmes.

There are 20 sea-related majors offered by 92 educational institutions nationwide. 

Joining these efforts, the Ministry of Labour, Invalids and Social Affairs (MoLISA) has added 15 occupations related to the marine economy to the key training list, including nine at the international level, eight at national and three at regional level. 

The MoLISA has teamed up with the Ministry of Agriculture and Rural Development to launch two vocational training programmes and another programme that improve skills for captains and chief engineers in coastal regions. 

Vocational training institutions in coastal localities have also been built and upgraded, with 90 colleges, 133 schools and 454 centres. Many of them offer majors in the marine economy. 

About 30,000 people in 28 coastal localities have been trained in the fishery sector. 

Personnel training in tandem with scientific research has focused on seafood, navigation and oil and gas. 

To meet the demand for workers, many training institutions have widened their programmes in marine affairs. 

Apart from major educational institutions like Da Nang University, Hue University, Nha Trang University and Vietnam Maritime University, others have added the marine economy and management to their curricula. 

Several others such as the Vietnam National Institute of Maritime Medicine and Hai Phong University of Medicine and Pharmacy have also completed frameworks of maritime medical training programmes at both graduate and post-graduate levels. 

The Vietnam Academy of Science and Technology and some universities have offered majors in maritime science-technology. 

The navigation sector has partnered with universities and training institutions nationwide in personnel training, developing a workforce of 44,000 seamen.   

The quantity and quality of workforce in the vessel registration sector has been improved towards standards set by the International Maritime Organisation and the International Association of Classification Societies. 

Also, Vietnam has placed importance on international cooperation in maritime human resources development recently, aiming to become a strong sea-based nation.

Expo to display agro-forestry, fisheries tech     

A wide range of products, technologies and equipment used in the agricultural, forestry and fisheries sectors will be on display at Growtech, an international agriculture–forestry–fishery exhibition to be held in Ha Noi next month.

According to the organisers, 150 enterprises have registered so far from around Viet Nam and countries and territories like the Netherlands, Italy, Belarus, Czech Republic, Japan, South Korea, Thailand, Taiwan, and mainland China.

The second edition of the exhibition would feature advanced machinery and equipment and technology for irrigation, farming, harvesting, and preservation, machinery and equipment for forestry and machines for small-scale farming, said Ha Thi Phuong Lam, chairwoman of Adpex JSC, one of the event’s organisers.

The exhibition would offer local farmers and businesses the chance to see the latest technologies, equipment and products used in the agro-forestry and fishery sectors and collaborate with their foreign counterparts, she said.

Besides displaying innovations, Growtech will also contribute to trade promotion in the three fields.

Many conferences and seminars are scheduled to be held on the sidelines.

To be held at the Ha Noi International Exhibition Centre (I.C.E) from November 21 to 23, the exhibition is expected to attract more than 8,000 visitors, delegates and specialists from more than 20 countries and territories.

It is jointly organsied by the National Agency for Technology Entrepreneurship and Commercialisation Development, the Viet Nam Administration of Forestry, the Agro Processing and Market Development Authority, the Viet Nam Climate Innovation Centre, and Adpex JSC.

The agro-forestry-fishery sector plays a significant and growing role in the country’s exports.

According to the Ministry of Agriculture and Rural Development, Viet Nam earned US$29.54 billion from agro-forestry and fishery exports in the first nine months of the year, up 9.3 per cent from the same period last year.

Grab launches food delivery service in Hà Nội     

Southeast Asian ride-hailing company Grab on Tuesday officially launched its on-demand food delivery service GrabFood in Ha Noi.

With the official launch of GrabFood, Ha Noi has become the second city in Viet Nam to receive the whole range of Grab’s consumer services, including on-demand transport (GrabTaxi, GrabCar, GrabBike), parcel delivery (GrabExpress), and food delivery (GrabFood) through one mobile app.

“GrabFood is a natural extension of our transport offerings. Vietnamese consumers are excited to try new things, and will choose a food delivery platform that offers the most dependable service providing the widest range of food offerings with best value-for-money and fastest speed of delivery,” said Jerry Lim, Country Head of Grab in Viet Nam.

“GrabFood meets the needs of consumers, while at the same time enabling better income and revenue opportunities for our delivery and merchant partners in HCM City and Ha Noi, especially those with shops or stalls located in more remote areas,” said Jerry Lim.

“With no minimum order required, consumers can order from a wide selection of cuisines available, enjoying the convenience of having their favourite food delivered fast, right to their doorsteps within 25 minutes on average,” said Demi Yu, Regional Head of GrabFood Thailand, Malaysia, Viet Nam and the Philippines.

In HCM City, GrabFood was beta tested on May 10 and officially launched in June and has since achieved impressive month-on-month growth. In September, delivery orders of GrabFood grew by 2.3 times compared to the previous month.

Meanwhile in Ha Noi, GrabFood was beta tested on September 5. After less than a month, the number of merchant-partners increased 8 times.

In September 2018, average monthly income of GrabBike driver-partners in HCM City and Ha Noi grew 20 per cent compared to the previous month, thanks to additional income opportunities from delivering food and parcels, on top of taking rides.

Consumers pay by cash on delivery and Grab is also working on enabling a cashless option for more seamless payment directly to merchant partners.

“GrabFood is the next major step in our path towards becoming an everyday super-app that meets the daily essential needs of consumers. Our interconnected and interlinked services enable us to build an ecosystem that benefits not only our customers and driver-partners, but also our merchant-partners and delivery-partners,” Jerry Lim said.

“Currently, two out of 10 Vietnamese people are using Grab services every month. As a technology platform, Grab is committed to long-term investment in Viet Nam, thereby improving the quality of living by better serving the Vietnamese and driving Viet Nam towards the digital economy,” Jerry Lim added. 

Vietjet opens sales for Phu Quoc–Seoul route

Vietjet has started selling tickets on its international new route connecting Phu Quoc island in the Mekong Delta province of Kien Giang and Seoul capital city of the Republic of Korea.

The Phu Quoc–Seoul route will have a daily return flight from December 22 with flight time of around 5 hours 30 minutes per leg. The flight departs from Phu Quoc at 3.30pm and arrives at Seoul at 10.45pm (local time). The return flight takes off from Seoul at 1.45am (local time) and lands in Phu Quoc at 5.35am.

Phu Quoc is known as “Pearl Island”, the largest island in Vietnam. Being a famous travel destination, Phu Quoc has attracted significant investment in tourism and resort real estate, the airline said in a statement.

Upon launching the new route connecting Phu Quoc to Seoul, Vietjet expects to not only bring modern air travel to local people and tourists but also promote trade and contribute to improving the local investment, it said.

According to the management board of the Phu Quoc Economic Zone, the district has 279 potential projects in tourism, housing, agriculture, public service and forestry. The total investment in the projects is worth 361 trillion VND (15.4 billion USD)

Since 2015, it has received 4.7 million visitors, 20.5 percent of them foreigners. 

Vietjet is the first airline in Vietnam that operates a low-cost, modernized carrier model to provide a wide range of services to its customers. Apart from air transportation, Vietjet also provides consumer goods and services to the customers through the application of advanced E-Commerce technology.

Vietjet is an official member of the International Air Transport Association (IATA) with IOSA Safety Certificate. In addition to the “Top 500 Leading Brands in Asia 2016” and “Best Recruiting Brand in Asia” for many consecutive years, Vietjet is also honored to be the Best Asian Low Cost Carrier awarded by TTG Travel Award in 2015. Besides that, Vietjet is also honored as the Top 3 Fastest Growing Facebook Fanpage award by Socialbakers.

Currently, Vietjet operates 60 A320, A321 aircraft with more than 385 flights daily, carrying more than 60 million passengers up to date, with 94 routes covering destinations in Vietnam as well as international destinations such as Japan, Hong Kong, Singapore, the Republic of Korea, Taiwan, China, Thailand, Myanmar, Malaysia and Cambodia.                

Vietjet plans to expand its network across the Asia-Pacific region and is continuing to expand its regional network. Recently, Vietjet signed a contract agreement to purchase new, modern aircraft from the world’s leading aircraft manufacturers.

Hong Kong investors inject more capital into Vietnam

Investors from Hong Kong (China) are increasing their capital in Vietnam to grasp opportunities brought by trade and investment agreements inked between the two sides.

Secretary of the Hong Kong General Chamber of Textiles Pong Su Ling said close to 20 Hong Kong enterprises will attend three garment and textile exhibitions in November in Ho Chi Minh City. 

They have sought investment opportunities in ASEAN countries and see Vietnam’s considerable potential, she said, adding advanced technology and equipment will be at the fairs.

The signing of the ASEAN- Hong Kong Free Trade Agreement (AHFTA) and the ASEAN-Hong Kong Investment Agreement (AHKIA) will facilitate market access, create business opportunities and enhance investment flow. Hong Kong firms have said the deals will create jobs and bolster cooperation between small and medium enterprises of both economies.

The agreements are said to increase capital flow to the Southeast Asian country, Pong Su Ling said, stressing the firms will invest heavily in material production for garments and textiles, which is still absent in Vietnam.

As material production for the sector poses high risk of pollution, investments will not be easy. However, Hong Kong firms are confident that with modern technologies, this is not a worrisome problem.

CEO and Vice Chairman at Esquel Group Limited John Cheh said his company had built plants in Vietnam since 2011, considering this a strategic investment that helps the group take advantage from the garment and textile growth in Vietnam. 

“Esquel has four plants and is considering to open showrooms to meet domestic consumption demands”, he said.

Along with garments and textiles, Vietnamese infrastructure and fintech have served as fertile ground for Hong Kong capital.

As a long-term investor in Vietnam, President of Sunwah Group Jonathan K.S.Choi said that instead of a cheap labour market, Vietnam has shot to stardom as a strong consumption market spurred by the growth of a young and middle-class population. 

Meanwhile, Hong Kong financial chief Paul Chan said Vietnamese finance, infrastructure and trade services will lure Hong Kong capital thanks to the sound bilateral ties, and the AHKFTA and the AHKIA that strengthen economic relations between the two sides.

Vietnamese firm wins at Global Smart Cities Contest

President of the jury Sarolta Besenyei (L) presents the award to Chairwoman and General Director of the AIC Group Nguyen Thi Thanh Nhan 

The Advanced International JSC (AIC Group) of Vietnam has won the “World’s Best Smart National Concept and Model” award at the Global Smart Cities Contest 2018.

The contest was organised by the World’s Smart Cities Organisation, the Institute of Control Sciences of the Russian Academy of Sciences and the Normandy French Tech association.

Organisers said despite efforts to find comprehensive and feasible smart city models, countries around the world have carried out separate solutions focusing on certain fields like transport, energy management and healthcare.

The solution created by the AIC Group received the best evaluation because it can connect central agencies, ministries and cities with grassroots establishments like schools, hospitals and businesses. It combines smart applications based on big data, real-time information, artificial intelligence, and analysis and prediction algorithms to form a system of integrated operations centres at different levels.

At the awards ceremony in London, the UK, on October 1, President of the jury Sarolta Besenyei said the contest attracted more than 300 projects in different fields. The jury was impressed with the AIC’s project since it suggested not only concept and model but also solutions to build smart nations.

Chairwoman and General Director of the AIC Group Nguyen Thi Thanh Nhan said over the last two years, the firm has introduced smart city and smart nation solutions to many localities, ministries and sectors of Vietnam and received positive feedback. She said the smart nation model of AIC can be carried out successfully soon.

Eduard Dumitrascu, President of the World’s Smart Cities Organisation, expressed his belief that AIC will soon make its smart nation ideas into a reality.

Hanoi leads FDI injection in first three quarters

Hanoi led Vietnam in foreign direct investment (FDI) inflow in the first nine months of 2018 with more than 6.26 billion USD, a 5.4-fold rise from the same period last year, according to a local official.

Some 162.7 trillion VND (over 6.95 billion USD) in non-state investment was injected into 70 projects in the capital, with local investment for development estimated at 219.44 trillion VND (9.38 billion USD), up 10.3 percent, Director of the municipal Department of Planning and Investment Nguyen Manh Quyen told the 15th meeting of Hanoi’s 16th Party Committee on October 1.

The meeting, chaired by Secretary of the city’s Party Committee Hoang Trung Hai, was held to review socio-economic development in the first three quarters of the year and tasks for the remaining months.

The nine-month Gross Regional Domestic Product (GRDP) rose by 7.17 percent as compared to 6.87 percent of the same period last year and is expected to exceed 7.35 percent this year. Export earnings rose by 21.6 percent to 10.51 billion USD.

The city welcomed about 19.7 million visitors, including 4.3 million foreigners, up 9.2 percent and 20 percent, respectively.

During the period, the city created jobs for 151,000 people, up 18.8 percent year-on-year, and 84.9 percent of the local population were covered by health insurance.

The city has also seen progress in IT application at governmental offices. It has accelerated public administrative reforms by introducing hundreds of online services.

In the final quarter, the city will focus on stimulating consumer demand and keeping the local market and prices under control, particularly ahead of the Tet holiday (traditional New Year of the Vietnamese).

Secretary of the city’s Party Committee Hoang Trung Hai asked local authorities to intensify urban management and promote traffic safety in the remaining months. He also urged them to promptly devise solutions for issues in capital construction projects, especially in terms of land clearance and management of condominiums.

He noted the city will put into use a number of key projects in the next few months, including a flyover across the An Duong – Thanh Nien intersection, Duong River Surface Water Treatment Plant and Cat Linh – Ha Dong elevated railway.

Vinalines spends over 7 trillion VND on port construction in Hai Phong

Vietnam National Shipping Lines (Vinalines) has sought approval from the Ministry of Transport and the Government for a project to build two container ports at Lach Huyen international seaport in Hai Phong northern city.

Vinalines said the construction of new container ports in Lach Huyen is urgent in order to meet trade demand, as the city plans to move Hoang Dieu port in the Hai Phong International Gateway Port for urban development.

The new ports, with a total length of 750m, will be built with investment worth around 7 trillion VND (300.7 million USD). Once operational, they are expected to receive cargo vessels of up to 100,000 DWT. 

In addition, Vinalines and the Hai Phong Port will strengthen cooperation and invest in a 250ha-logistics centre to optimise trade activities in the area.

The project aims to realise Vinaline’s target of handling 30 percent of goods going through the country’s ports by 2020, as well as maintaining its position as the country’s key port operator.

Lach Huyen port will be developed as the sole port in Vietnam’s northern region able to receive ships of 150,000 tonnes.

Kien Giang earns over 468 mln USD from exports in nine months

The Mekong Delta province of Kien Giang earned over 468 million USD from exports in the first nine months of the year, up nearly 35 percent year-on-year and over 90 percent of its planned annual total, reported the provincial Department of Industry and Trade. 

Accordingly, export earnings from rice surpassed 158 million USD, up 23.3 percent; fruit and vegetables hit 6.4 million USD, up more than 40 percent; aquatic products at 155.6 million USD, up 11 percent; leather and footwear reached 121.3 million USD, up 117.7 percent; and other goods reached 26.5 million USD, up 44 percent. 

The province’s rice, seafood, and footwear were shipped to more than 30 markets worldwide. 

The department said rice exporting has become more promising, with domestic and foreign merchants buying rice from farmers and forming production-consumption chains. 

Footwear has gradually become a key currency earner, contributing to raising the local export value. 

The province has also boosted trade promotion such as marketing goods at domestic and foreign fairs to seek new partners and expand markets, while removing difficulties faced by exporters to help them churn out quality goods with competitive rates and high added values. 

A representative from the department said the province strives to earn more than 191 million USD from exports in the fourth quarter, raising the yearly figure to 660 million USD, surpassing the plan by 27 percent and up 40 percent annually. 

In the remaining months of the year, the province will continue ensuring supply to meet export demands, especially for rice and aquatic products, while strengthening traditional markets and seeking new ones. 

Local exporters will be arranged to attend domestic and foreign trade fairs to seek partners and expand markets. 

More attention will be given to the export of competitive goods and cross-border trade, in particular selling goods to Cambodia via the Ha Tien international border gate. 

Can Tho records highest nine-month export figure in years

The Mekong Delta city of Can Tho earned 1.46 billion USD from exports in the first nine months of the year, reaching 81.7 percent of the yearly target and up 14.65 percent over the same period last year, according to the municipal Department of Industry and Trade (DoIT).

This is the highest result that the city has achieved in many years, said the department.

Nguyen Minh Toai, Director of the DoIT, attributed the rise to the surge in both export volume and the value of major products of the city, such as rice and seafood.

Specifically, in the year’s first nine months, the city shipped 582,455 tonnes of rice abroad for 234.5 million USD, up over 8 percent in volume and more than 20 percent in value year-on-year, while exporting nearly 117,000 tonnes of aquatic products for 378.67 million USD, a rise of 3.83 and 10.3 percent, respectively.

Alongside this, a strong rise was also seen in the export revenue of some other products, such as handicraft by 39.55 percent, garments and textiles by 37.22 percent, and farm produce by 38.46 percent.

Toai said that in the coming time, the department will continue to work closely with other departments and agencies in the city to support local firms in reforming technological application and enhancing the productivity and quality of products.

At the same time, the city will also focus on removing difficulties facing businesses; promoting production and business; strengthening trade promotion activities and administrative reform; and applying policies to support enterprises in capital to reform their technology, enhancing the quality of products to raise competitiveness, added Toai. 

Nghe An seminar talks trade dispute settlement

A seminar discussing the settlement of trade disputes in the Fourth Industrial Revolution took place in Vinh city, in the central province of Nghe An, on October 2. 

Co-hosted by the International Finance Corporation, the Vietnam International Arbitration Centre (VIAC), and the provincial chapter of the Vietnam Chamber of Commerce and Industry (VCCI), the event aims to offer businesses an insight into trade mediation, as well as effective and safe settlement of trade disputes, thereby improving their competitiveness and enabling them to expand their markets. 

Participants learned about existing laws and the court’s support to settle trade disputes via arbitration and mediation mechanisms, several terms of the Code of Civil Procedure on recognising the outcomes of dispute reconciliation outside courts, and Decree No.22/2017/ND-CP on trade reconciliation. 

Trade arbitration is new to Vietnamese businesses as Decree No.22/2017-ND-CP was promulgated in February 2017 and the VIAC founded in May 2018. 

Phi Trong Duc, Director of the provincial VCCI chapter, said Vietnam ranked 66th out of 190 countries in terms of contract enforcement, and 29th in credit access in a survey recently conducted by the World Bank. 

The survey pointed out that Vietnamese firms now tend to choose trade arbitrators instead of seeking courts to settle disputes. 

Pham Thi Thanh Huyen, a senior finance expert in charge of IFC’s financial infrastructure development programme, said that trade arbitration is considered a feasible and effective way to deal with trade disputes, contributing to fostering trust amongst firms and the community. 

HCM City posts GRDP growth of almost 8% in nine months

HCM City posted over VND903 trillion in the Gross Regional Domestic Product (GRDP) in the first nine months, up 7.89% against the same period last year, said Mr Su Ngoc Anh, director of HCM City’s Department of Planning and Investment.

The service, industrial and construction sectors saw an increase of 8.0% and 7.92% respectively while the agriculture sector witnessed a rise of 6.18%.

HCM City’s economic growth has been less dependent on investment capital and increased scientific factors.

Total state budget collection in the first nine months are estimated at more than VND269 trillion, making up 71.44% of the yearly target, up 9.88% against the same period last year.

Of the figure, the total revenue from the domestic sector accounted for 68.08% of the yearly target, up 12.97% while earnings from crude oil and exports fulfilled 141.96% and 71.11% of the yearly plan respectively.

Regarding the restructuring of industries in GRDP, the service sector made up a proportion of 61.2%. The city’s economic restructuring process has gradually increased the proportion of high quality and highly added-value service sectors. Nine groups of the service sector are considered the strong points of HCM City, namely trade, finance, banking, insurance, tourism, information and communications, logistics-ports-depots, science and technology, real estate, education and health.

Nine groups of the service sector accounted for 55.9% of the GRDP, of which the real estate, trade, logistics and depot sectors have made up a high proportion of 33.7% in the GRDP.

In the reviewed period, the city’s economy performed fairly well, growing at 7.89%, edging up from 7.87% a year earlier.

FDI double to nearly US$5.47 billion, an increase of 50% from last year. Exports were worth around US$28.2 billion, an increase of 7.7%.

Imports cost US$34.8 billion, an increase of some 10.5%. Services and retail sales grew by 12.8% and industrial output by 7.89%.

The four key industries – engineering and automation, electronics, chemicals, rubber and plastics, and food processing continued to perform strongly, expanding markets, investing in technology, improving the quality and competitiveness and growing at nearly 8.39%.