BUSINESS NEWS 13/5

Car sales rise sharply

BUSINESS NEWS 13/5

Passenger car sales in the first half of the year rose 35% year-on-year to over 110,000 units, according to data from the Vietnam Automobile Manufacturers Association (VAMA).

Meanwhile, the local market recorded a slump in sales of commercial and specialized automobiles by 1.5% and 32% to some 38,000 and 3,000 units, respectively.

However, the fruitful sales of passenger cars contributed greatly to the country’s total sales of automobiles, which totaled over 150,000 units, equivalent to a 21% year-on-year increase.

The sales results show that there is significant room for the local automobile market to grow, especially for passenger cars since the number of people who own this kind of vehicle remains low. Based on the performance in the first half of the year, total sales by the end of the year is expected to exceed 300,000 vehicles.

According to VAMA, sales of locally assembled cars over the first half slipped 14% to some 90,000 units, while that of imported cars rose a staggering 203% to exceed 60,000 units.

Last month, members and non-members of VAMA, excluding Hyundai Thanh Cong, sold the same number of cars as in May, at more than 27,000 units, up 19% versus last-year’s figure.

Sales of locally assembled cars in June bounced back to reach over 16,000, up 6% month-on-month, while the volume of completely-built-up vehicles being sold dropped 7%.

Further, statistics from Hyundai Thanh Cong show that its sales during the first half of the year hit more than 35,000 cars.

Fishermen ordered to follow fishing regulations

The owners of fishing vessels and fishermen are required to follow regulations on illegal, unreported and unregulated (IUU) fishing, including keeping a record and submitting it, according to the Vietnam Association of Seafood Exporters and Producers (VASEP).

VASEP said that to lift the yellow card imposed on Vietnamese seafood by the European Commission (EC) and to develop a sustainable fishing sector, the association has collaborated with the Directorate for Fisheries to deploy a plan, which is aimed at having boat owners and fishermen comply with certain regulations on fishing.

Accordingly, when fishing offshore, fishing boat owners and fishermen have to hold a fishing license, hang the Vietnamese flag, participate in rescue efforts and protect their nation’s sovereignty and marine security, apart from not using prohibited fishing tools and violating IUU rules.

As for fishing boats that measure 12 meters or more, the owners of these boats are required to keep a record of their fishing activities and submit it in line with regulations, whereas boats that are at least 15 meters long need to install monitoring systems and global positioning system devices and undergo frequent inspections, according to VASEP.

Meanwhile, boats that are at least 24 meters long have to have GPS devices installed, VASEP added.

VASEP said that fishing boat monitoring and inspection documentation will be used to decide penalties for offenders and to address debates on marine issues, so the devices have to store the exact sea routes.

It is mandatory for fishermen to inform controllers of fishing ports before their boats dock at these ports. Besides this, boats fishing beyond Vietnam’s waters have to be granted a code by the International Maritime Organization and must get a license from the Directorate of Fisheries.

VASEP Deputy General Secretary Nguyen Hoai Nam told the Saigon Times that EC will send a working team to Vietnam to review the country’s efforts to fight IUU fishing in November, instead of June as scheduled.

Phong Phu to supply denim fabric to fast-fashion retailers

Phong Phu Corporation is working on essential procedures to provide denim fabrics to fast-fashion retailers such as Zara, H&M and Levi’s in Vietnam, after setting up a joint venture with a business partner who is a denim supplier of these brands.

Pham Xuan Trinh, general director of Phong Phu Corporation, on July 9, told the press that brands such as Zara, H&M and Levi’s manufacture a wide range of products in Vietnam and sell them globally. They have had to import denim fabrics from Thailand, Taiwan and China to Vietnam to serve production needs. However, the joint venture founded last month in Vietnam will supply fabric to these retailers, he said.

Customers will pay a visit to the joint venture plant in September. It is preparing fabric samples for them, Trinh added.

According to Trinh, setting up a joint venture with a partner who has significant experience in the soft-line industry is part of Phong Phu’s strategies to promote exports, join the global supply chain by leveraging the strengths of both parties and raise the firm’s market share in the local apparel market.

Phong Phu is set to become the country’s leading denim supplier for the local market as well as for Europe and the United States. The joint venture factory is expected to generate some 12 million meters of denim fabric per year during the first phase.

Many firms had mapped out their business plans for 2019 with the expectation that free trade pacts such as the CPTPP and EVFTA would encourage the country’s economic growth, but not many firms were beneficiaries of these trade deals in the first half.

Phong Phu alone has encountered obstacles in exporting cotton threads as Chinese buyers purchased the product at below market price, prompting the company to suspend exports and switch to supplying the material for domestic towel production, resulting in a drop in revenues during the first half of the year.

Transport Ministry orders withdrawal of decision on toll collection suspension

Deputy Minister of Transport Le Dinh Tho has asked the Directorate for Roads of Vietnam to revoke the decision on toll collection suspension at three build-transfer-operate (BOT) road tollgates, which was made as a warning to BOT investors who failed to install electronic toll collection (ETC) systems on roads.

The Ministry of Transport asked the directorate not to stop fee collection at the Can Tho-Phung Hiep BOT, Bac Hai Van BOT and Cam Thinh BOT tollgates begining July 10 as scheduled.

The ministry said that the investors in the three projects had negotiated and reached a consensus with the ministry on the terms of the contract appendix to install electronic toll collection (ETC) systems, resulting in the ministry’s directive to undo the directorate's decision.

Based on the ministry’s proposal, the Directorate for Roads of Vietnam sent a note to the IV Road Management Bureau and Can Tho-Phung Hiep BOT Company, the latter being the investor in the Can Tho-Hiep Phung BOT tollgate, acknowledging that the directorate will not suspend toll collection at the tollgate today, July 10.

As of July 7, 40 investors had signed the contract appendices, but the remaining four investors had yet to negotiate with the ministry to sign the contract appendix to install ETC systems.

The four investors are Phuoc Tuong-Phu Gia BOT Joint Stock Company, the investor in the Bac Hai Van tollgate; 194 Construction Investment Corporation, the investor in the Cam Thinh BOT tollgate; Duc Long Gia Lai BOT and BT JSC; and Can Tho-Phung Hiep BOT Company.

Earlier, Nguyen Van Huyen, head of the Directorate for Roads of Vietnam, told The Saigon Times that the ministry would suspend toll collection at the four road projects from 4 p.m. on July 10 if the investors failed to sign a contract appendix to install a nonstop fee collection system.

After the announcement on toll collection suspension was issued, Duc Long Gia Lai BOT and BT JSC, the investor in the National Highway 14 section passing through Gia Lai Province, have signed the contract appendix.

Local supporting industry firms assisted to enter global value chains

SFS 2019, or the sourcing fair for supporting industries with buyers 2019, is scheduled to take place on September 11 and 12, and is expected to open up more opportunities for local supporting industry enterprises to deepen their integration with global value chains.

The HCMC Department of Industry and Trade will coordinate with the Saigon Hi-Tech Park management board and the HCMC Export Processing and Industrial Zones Authority to organize the event, according to the Government news site Chinhphu.vn.

Nguyen Phuong Dong, deputy director of the HCMC Department of Industry and Trade, said that the event will help local manufacturers and supporting industry enterprises access domestic and foreign partners, improve their supply capacity and gradually participate in global value chains.

The event will also help small and medium supporting industry enterprises expand their operations, invest in new equipment and take part in the city’s investment promotion programs.

According to Le Nguyen Duy Oanh, deputy director of the HCMC Center of Supporting Industries Development, the event this year will include a conference to seek suppliers for supporting industries, a seminar on opportunities for supporting industries, a fieldtrip to enterprises’ factories and an exhibition of typical supporting industry products, among other things.

Some 20 foreign direct investment (FDI) enterprises and 100 supporting industry manufacturers will participate in SFS 2019.

According to the organizers, the event will focus on seeking suppliers in the electronics, automobile and mechanical engineering sectors. There will be one-on-one meetings between FDI firms and local supporting industry manufacturers.

USAID offers support to Vietnamese customs

The United States Agency for International Development (USAID) and Vietnam’s Ministry of Finance on July 10 launched the USAID Trade Facilitation Program, with a fund valued at US$21.7 million, to support Vietnamese customs activities.

The launch event was attended by Vietnam’s Deputy Prime Minister Vuong Dinh Hue; U.S. Ambassador to Vietnam Daniel J. Kritenbrink; USAID/Vietnam Mission Director Michael Greene; and representatives of local government agencies, international organizations and business associations.

The five-year program aims to support Vietnam in adopting a risk management approach at customs and specialized inspection agencies, which will strengthen the execution of the World Trade Organization's Trade Facilitation Agreement, to which both Vietnam and the United States are signatories.

The USAID Trade Facilitation Program will work with the General Department of Vietnam Customs (GDVC), under the Ministry of Finance, to strengthen the role and capacity of Vietnam's National Trade Facilitation Committee (NTFC) and their associated working groups to improve the efficiency of specialized inspections and customs-to-business partnerships.

Over the past two decades, Vietnam has become one of the most open economies in the world. However, inefficient border procedures prevent Vietnam from improving its trade competitiveness.

Specialized inspection is part of the customs clearance procedure used by ministries handling the import and export of goods.

Vietnam’s specialized inspection involves multiple ministries, causing major delays in customs clearance, costing traders time and money and hurting small and medium-sized enterprises (SMEs) the most.

The USAID Trade Facilitation Program will be in force until 2023 and will support the standardization of policies and procedures for import and export, strengthen national and provincial coordination and build the capacity of provincial customs officers.

By supporting risk-based approaches to border clearance, USAID will help Vietnam present a more attractive and predictable trade and investment climate for domestic SMEs and international traders and investors, including those in the United States.

Local SMEs slow to respond to free trade pacts

Many local firms, particularly small and medium-sized enterprises (SMEs), remain indifferent and are making no preparations to make the most of the European Union-Vietnam free trade agreement (EVFTA).

Vietnam has signed and executed multiple FTAs, creating opportunities for the local economy, Ngo Chung Khanh, deputy head of the Multilateral Trade Policy Department at the Ministry of Industry and Trade, told a conference titled “Identifying trade and investment opportunities in the context of EVFTA,” on July 10 in Hanoi.

He noted that the ministry had voiced concern over the lack of preparation among local firms on the threshold of these trade pacts, including the EVFTA.

Many firms have paid little attention to the latest trade pact. Since the EVFTA was announced to the public, the trade ministry received only two inquiries from companies regarding tariff codes and country of origin regulations. These questions were mainly raised by foreign-invested firms.

Addressing the event, a representative of the Vietnam Chamber of Commerce and Industry (VCCI) pointed out that Vietnamese firms were lax in updating their knowledge bases. It is rumored that VCCI had insisted enterprises join its training courses, rather than inviting them to do so, as the firms had shown no interest in these programs.

Even on being notified of helpful training sessions on ways to export acipensers to Thailand, both local authorities and firms expressed indifference, the VCCI representative said.

Earlier, the prime minister issued a decision to execute the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), asking ministries and local authorities to work out specific plans and send them to the trade ministry. However, the number of plans sent to the ministry remains modest to date, even after repeated requests from the prime minister.

These plans would help the country embrace opportunities and realize the benefits of the trade deals. If State management agencies continue to execute the EVFTA at the same snail’s space as the CPTPP, these opportunities will never be realized, Khanh said.

According to Khanh, companies in Vietnam have to make preparations to leverage the benefits of the EVFTA as soon as possible and focus on product origin rules, technical barriers and duties so that their products can quickly reach European consumers.

Former chairman, chief accountant of Sagri arrested

Ministry of Public Security investigators on July 7 detained Van Trong Dung, former chairman of State-owned company Saigon Agriculture Incorporated (Sagri), and former Sagri chief accountant Nguyen Thi Thuy for alleged mismanagement and misuse of State assets, causing losses and wastefulness.

The ministry also searched their homes and workplaces.

The charges brought against Dung and Thuy form part of an investigation into violations of the regulations on the management and use of State assets, causing losses and wastefulness at Sagri.

Earlier, former Sagri general director Le Tan Hung and Nguyen Thanh My, former deputy head of the planning and investment division at Sagri, were also indicted for the same violations.

The municipal inspectorate launched a comprehensive inspection into Sagri’s operations and found that the company had broken regulations on the management and use of land and finances and on the execution and transfer of projects over a long period.

Hung and Nguyen Thi Thuy, chief accountant of Sagri, signed 10 contracts worth more than VND13 billion with two tour operators for Sagri employees’ overseas study trips. However, 40 of the 70 employees did not participate in these trips.

Earlier this year, Hung and Thuy were reprimanded for serious violations of the 2003 Accounting Law.

Last year, the State Audit of Vietnam (SAV) pointed out Sagri’s misuse of 1,900 hectares of land and the transfer of land at lower-than-expected prices.

Sagri chairmen, general directors, deputy general directors and chief accountants must take responsibility for these shortcomings and violations, according to SAV.

Violators at Sagri to face Party discipline: HCMC Chairman

The HCMC People’s Committee has sent the Inspection Commission of the municipal Party Committee the case files on individuals found guilty of violations and shortcomings at State-run Saigon Agriculture Incorporated (Sagri) where the periods for handling their infringements have expired, requesting disciplinary measures from the Party.

HCMC Chairman Nguyen Thanh Phong made the announcement during his brief interview with a reporter from Nguoi Lao Dong newspaper on the sidelines of a local Party conference on Monday, July 8.

In addition to former general director Le Tan Hung, who was detained last Saturday, many other individuals who may be guilty of misconduct have yet to be penalized, according to the reporter.

In response, the chairman said some people had retired, quit their jobs or have been appointed to other positions, and their disciplinary enforcement periods have run out.

“So, among those who are Party members, the HCMC People’s Committee has transferred their cases to the Inspection Commission of the municipal Party Committee to consider their responsibility in line with Party regulations,” Phong said.

It is unreasonable that public officials and civil servants who commit violations cannot be disciplined if their wrongdoings are not detected within two years, he remarked, adding that the city authority is petitioning the central Government to resolve the issue.

Sagri, a wholly State-owned company, under the umbrella of the HCMC People’s Committee, was found to have made serious errors in dealing with land, finances and investment projects over a long period.

As a Sagri leader who was directly in charge of investment, production and trading activities, Hung was found to have made mistakes in the instruction, inspection and supervision of specialized units tasked with creating internal rules and was responsible for shortcomings and violations in projects and in the use and management of land, finances and loans.

According to the HCMC Department of Home Affairs, aside from Hung, 17 other individuals who are key leaders of Sagri, including those on its member council, the general director and members of its supervisory boards are also involved in the making of the Sagri scandal.

However, only three people are still subject to disciplinary action, while the limited period for holding 12 others accountable has passed.

HCM City’s industrial production picks up 7 percent

Ho Chi Minh City’s Index of Industrial Production (IIP) in the first six months of the year expanded 7 percent from the same time last year, propped up by high growth of the processing sector.

According to Deputy Director of the municipal Department of Industry and Trade Nguyen Phuong Dong, strong growth of metal and furniture production (59.4 percent, and 41.7 percent, respectively) pushed local processing to scale up 7 percent.

The industrial sector contributed 1.61 percentage points to the city’s gross domestic product (GDP) of 7.61 percent in the six-month period.

Besides, stable business operation of local enterprises helped increase budget collection, with import-export revenue surged 19.8 percent year on year.

However, production of four key industries, namely mechanics, food processing, chemicals, plastics and rubber, and electronics and information technology, grew only 5.5 percent, as compared to 9.5 percent in the first half of 2018.

Economists said that it moved in tandem with the nation’s trend as exports faced hurdles while input costs increased, making local firms earn less.

To be more specific, mechanics, food processing, and chemicals-rubber-plastics experienced a modest increase of 3 percent, 1 percent and 0.8 percent. However, the IIP of the four key industries was backed by the electronics and IT’s growth of 28.3 percent.

Regarding the city’s key products, the HCM City Export Processing and Industrial Zones Authority (HEPZA) has licensed 42 projects to branch out potential and main industrial products.

The municipal Department of Industry and Trade has joined hands with competent agencies and worked with 17 local firms to remove their bottlenecks, while promoting trade promotion for the city’s industrial products.

Bui Hoang Yen from the city’s trade promotion office said that local processing and manufacturing are expected to increase in the coming time since the foreign direct investment capital continue to flow into the sectors.

Actually, many enterprises have orders for the whole year, and shifting of foreign capital into Vietnam provides a strong foundation for several breakthroughs in the export activities.

National oil group’s six-month business tops plan

The Vietnam Oil and Gas Group (PVN) has announced it generated a total revenue of 365.5 trillion VND (15.8 billion USD) in the first half of this year, 18 percent higher than the six-month target and equivalent to 60 percent of the yearly goal.

The PVN contributed 53.5 trillion VND (2.31 billion USD) to the State budget, 16 percent higher than the six-month plan and equivalent to 61 percent of the year’s target.

The corporation’s equity increased from 465.5 trillion VND on January 1 to 470.3 trillion VND (20.34 billion USD) on June 30, up 1 percent.

 

In the first six months of this year, the State-owned firm has also successfully fulfilled production plans. It produced 11.52 billion kWh of electricity, exceeding the plan by 246 million kWh, or 2.1 percent, and 705,800 tonnes of nitrogenous fertiliser, 71,000 tonnes higher than the plan, or 10.06 percent.

Petroleum production was valued at 5.66 million tonnes, exceeding the plan by 48,000 tonnes.

To fulfill the business goals set for this year, the group continues to keep a close eye on the global oil prices to come up with the most effective production and business management solutions.

Besides, the PVN will rationally balance production output, export and processing of oil-gas and electricity so as to ensure the targets set by the Government on growing GDP, State budget collection and national energy security.

It will also promote the use of scientific solutions and new advanced technology to improve production and business efficiency.

Last year, PVN’s total revenue reached 626.8 trillion VND (27.11 billion USD), an increase of 26 percent compared to 2017, and it contributed 121.3 trillion VND (5.24 billion USD) to the State budget, up 24 percent year-on-year.

Apparel industry suffers due to lack of competitive dyeing, fabric segments

Lopsided development of its various segments and dependence on imports have weakened the textile industry’s competitiveness and creativeness, experts said.

Nguyen Van Tuan, Chairman of the Vietnam Cotton and Spinning Association, told Thoi Bao Kinh Doanh (Business Times) newspaper that while the yarn and apparel segments had grown strongly, others like dyeing were poorly developed, causing a bottleneck.

Besides, garment companies were hugely dependent on imported fabric, he said.

In 2017, for instance, 6.5 billion metres of cloth were imported, or two thirds of the industry’s entire demand.

Vietnam’s customs data shows imports in May were worth 1.35 billion USD, taking the total for the year to 5.43 billion USD, a 5.8 percent rise year-on-year.

“Because of dependence on imported fabric, companies have lost their creativity and so cannot add value,” Tuan said.

Concurring with the idea, Tran Thi Thu Hien of the Chien Thang Garment Company said the main weakness of garment companies was their dependence on imported cloth, mostly from China.

That was also a reason Vietnamese companies were expected to face difficulties after the country joined free trade agreements like the CPTPP since China is not a member of these agreements.

Besides, the huge fabric import was a paradox considering two thirds of the fibre produced in the country, or 750,000 tonnes, were exported every year at increasingly lower prices.

Experts attributed this to the poor development of the dyeing segment.

They said local companies lacked proper awareness of the dyeing process. They also lacked the technologies, human resources and skills required to develop this sector.

Furthermore, there were no industrial zones fully equipped to serve the dyeing industry, they said.

Tuan said developing the fabric and dyeing segments would be the key factor in the growth of the garment and textile industry.

He called for establishing industrial zones specialising in dyeing and cloth production.

Attracting foreign direct investment in the industry was also a key requisite for its development, he said.

Besides, there was a need for training human resources, he added.

Experts said most garment and textile companies had to hire foreign experts in dyeing, which pushes up their production costs.

So investing in the training of human resources was vital to developing the dyeing segment, they added.

Seafood exports nears 4 billion USD in first half

Vietnam’s seafood export turnover in June reached 794 million USD, raising the total value for the first half of the year to nearly 4 billion USD, up 0.3 percent year on year, according to the Ministry of Agriculture and Rural Development’s Agro Processing and Market Development Authority (AgroTrade).

China, Japan, the Republic of Korea and the US were the largest importers of Vietnamese seafood, accounting for 55.1 percent of the total export value.

Vietnamese firms have more chances to boost seafood exports to the US as many imports from China, including high value added seafood, have been subject to a 25 percent tariff in the North American country.

In the short term, experts suggested local exporters to sell more shrimp in the US as the US Department of Commerce (DoC) has already removed the anti-dumping duty on Vietnamese frozen shrimp. The preliminary duty of 4.58 percent has been scrapped for 31 local exporters following the DoC’s 13th Period of Review (POR13), which reviewed the anti-dumping tariff on shrimp imports from Vietnam.

As for tra fish, local firms should promote shipments to non-traditional markets like China, the EU and ASEAN since the DoC has increased anti-dumping tariffs on the products by 0.96-3.87 USD per kilogramme.

It is necessary for the Vietnamese processors to upgrade and improve preservation and processing facilities, making their standards equivalent with those in China. By so doing, they will have more chances to enter the US market, according to the insiders.

Vietnam, Cambodia hold trade, investment promotion forum

The Vietnam – Cambodia Trade and Investment Promotion Forum 2019 took place in Phnom Penh recently, attracting over 200 delegates from the two countries, especially from southwestern border provinces of Tay Ninh, Dong Thap and An Giang.

The event, the first of its kind, was co-organised by the Vietnamese Embassy, the Vietnam Trade Office, and the Vietnam Business Club in Cambodia.

Representatives from about 100 Vietnamese and Cambodian enterprises discussed business procedures and legal framework with the two nations’ relevant ministries and agencies.

Vice Secretary General of the Council for the Development of Cambodia (CDC) Nut Unvoanra said the event affords the CDC a chance to update new policies for Vietnamese enterprises.

He wished that more Vietnamese investors would come to Cambodia in the near future, especially those in industry.

Cambodia holds potential in industry and agriculture, he said, urging Vietnamese firms to invest more in promising fields.

Speaking highly of the European Union – Vietnam Free Trade Agreement and the EU – Vietnam Investment Protection Agreement signed on June 30, he said the deals will help expand Vietnam’s exports.

The two governments set a goal of raising two-way trade to 5 billion USD this year, which needs great efforts from the two nations, he said.

The figure topped 4.7 billion USD last year, up 23.8 percent year-on-year. It rose 19.1 percent to more than 2.3 billion USD in the first five months of this year.

Vietnam has so far invested in 214 projects worth upwards 3 billion USD, 176 of them valid with a total registered capital of 2.77 billion USD. The country is now among the top five investors in Cambodia.

Vietnam has been among the largest sources of tourists to Cambodia with nearly 900,000 visitors in 2018.

Vietnam and Cambodia have reached a number of economic cooperation agreements, and are preparing to sign a border trade agreement this year.

USAID-funded trade facilitation project launched

A trade facilitation programme worth over 21.7 million USD funded by the United States Agency for International Development (USAID) was launched in Hanoi last week.

The project will be performed in five years, aiming to reform, standardize, harmonize and simplify administrative procedures in terms of import and export, in accordance with international standards, towards implementing the Trade Facilitation Agreement (TFA) of the World Trade Organisation.

The implementation strategy of the project will be at the central to the provincial level, focusing on strengthening coordination among ministries; supporting policy reforms on trade facilitation and implementation of TFA; cutting specialized inspection procedures; and promoting partnership with the private sector.

Speaking at the event, Deputy Prime Minister Vuong Dinh Hue highlighted the significance of the project, saying that it meets requirements and desire of the Vietnamese Government in implementing the TFA and other new-generation free trade agreements.

Under the direction of the Government, the Ministry of Finance presided over and coordinated with ministries and branches to implement the national one-stop-shop mechanism, which is connected to those of five ASEAN member nations, he noted.

US Ambassador to Vietnam Daniel J. Kritenbrink said the US administration will coordinate with the Vietnamese side in implementing the project, thus harmonizing and simplifying specialized inspection procedures.

He stressed that US businesses always consider Vietnam an attractive investment destination, so the US wishes to maintain effective partnership with Vietnam’s Ministry of Finance and General Department of Customs, as well as other partners and business communities, in order to make it easy for sustainable growth in Vietnam.

Vice Director of General Department of Customs Mai Xuan Thanh said the agency has paid attention to streamlining its organisation apparatus, reforming working methods, and improving labour productivity.

He pledged that the customs sector would focus all resources to work with USAID to effectively perform the programme.

54.6 million people have jobs in Q2

Nearly 54.58 million people have jobs in the second quarter of this year, heard a press conference held in Hanoi on July 10 by the Ministry of Labour, Invalids and Social Affairs (MoLISA).

According to an update on the Vietnamese workforce released at the press conference, income of labourers and the rate of trained employees have increased.

During the first quarter, people having jobs numbered 54.32 million, representing a decrease of 0.38 percent against late 2018 but a rise of 0.61 percent year-on-year.

Of note, those unemployed were 1,059,000, down 3,280 from late 2018 and 7,980 as compared with the same period last year.

The highest unemployment rate was reported in the Mekong Delta with 2.79 percent. It was followed by north central, central coastal, southeastern, Red River and Central Highlands regions with 2.64, 2.43, 1.68 and 1.27 percent, respectively.

MoLISA Deputy Minister Doan Mau Diep said the average unemployment rate was forecast to reach 2 percent in the second quarter.

Such sectors as processing, manufacturing, construction, retail and wholesale will need more labourers.

Meanwhile, the demand for workforce in agriculture, forestry, seafood, mining, finance, banking and insurance is expected to drop, he said.

Binh Duong seeks to lure more Australian investors

A conference on foreign investment attraction to the southern province of Binh Duong was organised in Sydney on July 10, attracting crowds of representatives from the two countries’ business communities.

The event was part of the activities of the field trip to Australia by officials from Binh Duong province and representatives from Becamex IDC Corp.

The event heard that Binh Duong province has issued many important policies to attract foreign direct investment (FDI) and promote economic development, focusing on developing industrial clusters and zones, in order to meet the business and production demand of domestic and foreign enterprises.

By the end of 2018, as much as 2.1 billion USD in FDI was poured into Binh Duong, 50.2 percent higher than the set target. The province was home to 3,509 foreign-invested projects with total registered capital of 32.2 billion USD, ranking third nationwide after Ho Chi Minh City and Hanoi.

Speaking at the event, General Director of DETMOLD Group of Australia, which specialises in providing food containers, said 98 percent of products of the firm were produced in Binh Duong, adding that the company will continue to expand its long-term production in the locality.

Nguyen Phu Hoa, Chief Representative of Vietnam Commercial Affairs in Australia, said the conference demonstrates initiative and efforts by the Binh Duong authorities to lure more foreign investment to the locality.

Previously, a trade promotion workshop was held by the delegation in South Australia on July 8.

Purchase of Italy’s footwear equipment rises sharply in Vietnam

Italy’s equipment, machinery and technologies for the production of footwear and leather products have seen strong sale in Vietnam in recent years. Italian manufacturers of these items expect to push consumption to higher levels as the Vietnamese market is attracting multiple international shoe manufacturers.

Paolo Lemma, head of the Italian Trade Commission in Vietnam, told the media at the Shoes & Leather Exhibition 2019 launched today, July 10, that over the past five years, Italy’s export value for leather and footwear equipment and technology to Vietnam rose tenfold to 31.7 million euros in 2018 from 3.4 million euros in 2013.

Lemma said that given these figures, Italy had become Vietnam’s second largest supplier of equipment and technologies for the production of shoes and leather products, accounting for 19% of the total market share after China, which takes 56.5% of the total.

Gabriella Marchioni Bocca, president of Italy’s National Association of Manufacturers of Footwear, Leather Goods and Tanning Technologies (ASSOMAC), said that Vietnam has become the world’s third largest shoe manufacturer and second largest shoe exporter.

The success of Vietnam’s footwear and leather sector resulted from heavy investment from domestic and international firms and local firms’ efforts, she said.

Bocca explained that the members of ASSOMAC expected Vietnam’s footwear production sector to gain further ground as footwear manufacturers on the global market consider Vietnam an ideal investment destination. With Vietnam’s strong potential for growth in the footwear manufacturing sector, the members of ASSOMAC are looking into boosting their supply of machinery and equipment for the sector in Vietnam.

As such, the Shoes & Leather Exhibition attracted some 32 Italian firms that are experienced designers, manufacturers and suppliers of various equipment, machines and technologies, such as measuring, pressing, cutting, and finishing machines, integrated lines and chemicals used for leather and footwear production.

Most of the participating Italian firms have cooperated with local dealerships and distributors and have set up a representative office in Vietnam, Paolo said, adding that these firms are trying to strengthen their cooperative relationship with Vietnamese firms and seek new partners.

Apart from the Shoes and Leather Exhibition, the International Footwear and Leather Products Exhibition and the International Sewing Machinery Show also kicked off on July 10 at the Saigon Exhibition & Convention Center in HCMC’s District 7, creating a series of leather and footwear events, which attracted 700 local and international manufacturers and distributors, the local media reported.

The exhibitions, jointly organized by the Vietnam Leather, Footwear and Handbag Association, international exhibition organizing firm Top Repute and the HCMC Shoes and Leather Association, also brought together firms, associations and corporate delegations from 32 countries and territories such as China, India, South Korea, Pakistan and Brazil.

The 21st International Shoes and Leather Exhibition is mainly showcasing the footwear, handbags, materials, machinery and chemicals of various enterprises from many countries and territories, such as Italy, Germany, Taiwan, South Korea and Argentina.

The series of exhibitions being held in Vietnam, which is considered a prestigious destination for international investors, is expected to gather a number of firms, buyers and providers active in the footwear and leather sector at home and abroad.

Trade minister calls for stiff penalty on origin fraud

Effective State management measures aimed at severely penalizing those caught committing tax evasion and falsifying their certificates of origin will help boost sustainable production, export and import.

Minister of Industry and Trade Tran Tuan Anh made the statement at a conference in Hanoi last week.

During the course of economic integration, trade fraud, fraudulent origin labeling and the circumvention of trade remedies directly affect the execution of free trade agreements and the development of sustainable trade, according to Anh.

To minimize the negative impact on investment attraction, he asked his agencies to take a proactive approach in executing the scheme to strengthen State management in preventing the circumvention of trade remedies and origin fraud.

The scheme, which was recently approved by Prime Minister Nguyen Xuan Phuc, aims to safeguard the rights and interests of local firms active in international trade and to improve the effectiveness of free trade agreements to which the country is a signatory.

Under the plan, the Government will tighten the management of import, export and foreign investment activities and raise awareness and the effectiveness of meeting regulations on trade remedies, product origins and customs procedures, as well as mete out strict punishment for any violation.

To that end, the competent agencies will keep a close watch on import and export activities with major trade partners to issue warnings on lawsuits related to trade remedies, as well as assist businesses, particularly small- and medium-sized enterprises, in responding to legal proceedings.

Further, they will diversify market destinations to reduce reliance on a single market, thus alleviating any negative impact from being slapped with measures to guard against trade remedy circumvention.

The Ministry of Trade and Industry shall be responsible for monitoring and updating the lists of goods subject to antidumping and antisubsidy investigations by foreign countries and will report the lists to the Vietnam Chamber of Commerce and Industry to strengthen control in granting certificates of origin for these kinds of goods.

Minister of Industry and Trade Anh urged his agencies to draw up an action plan for the ministry as soon as possible to set up the scheme.

He said that they should cooperate with other ministries, such as finance, public security, science and technology, as well as the Vietnam Chamber of Commerce and Industry, the General Department of Vietnam Customs and the General Department of Taxation to crack down on trade fraud.

“(We should) further streamline the regulatory framework, and the subjects are the business community and the public, so it is necessary to fine-tune the scheme of the prime minister,” he said, adding that the action plan of his ministry will be made available ahead of July 15.

By the end of May this year, Vietnamese exporters have had to face 83 cases of antidumping, 30 cases of safeguards, 19 cases of antidumping duty evasion and 14 cases of antisubsidies.

Authorities also found that many products imported from other countries or made in foreign countries under outsourcing contracts and labeled “made in Vietnam” are available on the domestic market or shipped to other countries, which has affected the prestige of Vietnamese exports and deceived local consumers.

 
 
 
 
 
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