Food company opens trade centre in Czech Republic
Food company opens trade centre in Czech Republic
TAMDA FOODS – a Vietnamese-owned company operating in the field of wholesale and retail of food and household appliances - has just opened a trade centre in Usti nad Labem city in the Czech Republic’s northern province of Ustecky.
Covering over 20,000 square meters, the centre, the third business location of TAMDA FOODS in the European country, aims to provide goods, including made-in-Vietnam, to locals and those living in the border areas with Germany.
Vietnamese Ambassador to the Czech Republic Ho Minh Tuan said he hopes the centre will help general jobs for local people and promote Vietnamese goods.
Ustecky Governor Oldrich Bubenicek recognised the contributions by the overseas Vietnamese community in the Czech Republic, including businesses, to the host society’s socio-economic development.
Meanwhile, Petr Nedvedicky, Mayor of Usti nad Labem city, said the centre will help generate more jobs for locals.
Marek Semanik, a driver at the company, told reporters from Vietnam News Agency that he has been working here for three years and feels very comfortable because of the good working environment and friendly coworkers.
He said he wants to work for long at the company and is able to speak Vietnamese fluently.
According to Director General of TAMDA FOODS Hoang Dinh Toan, 30 percent of the company’s staff workers are locals, the remaining Vietnamese.
At present, the company is serving over 20,000 kinds of goods for overseas Vietnamese and Czech Republic people, 10 percent of which are Vietnamese goods.
VND1 trillion solar plant linked to national grid
A solar power plant valued at over VND1 trillion (US$43 million) in the southern province of Long An joined the national grid on June 23.
The BCG - CME Long An 1 solar power plant, installed with 123,000 solar panels, is estimated to have a combined capacity of 40.6 megawatt peak (MWp). The site covers more than 50 hectares in Thanh An commune, Thanh Hoa district.
The power plant is expected to generate some 57 million kWh per year, which meets the power demand of 22,000 residents. It could also trigger an annual CO2 reduction of 16,000 tons.
The Long An provincial People’s Committee has worked closely with Bamboo Capital Group (BCG), Vietnam – Oman Investment joint venture, and many prestigious foreign energy developers to implement the project on a par with standardized technical, constructional, and environmental requirements. Other auxiliary items have also been executed, including a 110kV transformer station, road sections, water pumping stations, and one nine-kilometer transmission line.
Pham Van Canh, Vice Chairman of the Long An provincial People’s Committee, said the power plant would provide the locality with an increasingly stable supply of power and consolidate local socio-economic development as well.
Canh noted that the total power demand of Long An’s industrial parks is forecast to grow annually by 15 - 18 per cent over the coming years. Given this, the southern locality plans to have 16 solar power plants built in response to the expected soaring power demand.
The province has also given priority to increasing renewable resources in the near future, with a hope of spurring its economic development and creating additional jobs for locals.
JICA wants to help agricultural cooperation with Can Tho
The Japan International Cooperation Agency (JICA) wants to help more Japanese investors to cooperate with the Mekong Delta city of Can Tho in agriculture, heard a working session between the local People’s Committee and JICA’s working team on June 24.
According to JICA Deputy Chief Naomichi Murooka, the team will work to analyse challenges and demand to expand operation in Vietnam’s agriculture and food value chain of Japanese small and medium enterprises (SMEs).
Besides, it will figure out local firms’ potential so as to match them with promising Japanese partners.
After that, JICA will outline specific plans for cooperation during 2020-2024 with a view to improving Vietnam’s food value chain, as well as enhance Japanese investments in the Southeast Asian country, he added.
Speaking at the event, Chairman of the city People’s Committee Le Quang Manh stressed that the local authorities and competent agencies will closely work with the Japanese partners in the field.
He expressed his hope that JICA will devise more cooperative programmes with Can Tho in the coming time.
The same day, the Japanese team had separate working sessions with local departments and SMEs to collect data on local agriculture, and policies related to farm produce value chain.
Solutions sought to boost rice export amid market challenges
Vietnam needs to take new solutions and steps in rice production and export to ensure benefits of businesses and farmers given market-related difficulties forecast for the sector in the whole year, heard a seminar in Ho Chi Minh City on June 24.
According to Tran Quoc Khanh, Deputy Minister of Industry and Trade, the demand for rice of major markets like China, Indonesia and Bangladesh has dropped recently.
Meanwhile, the US Department of Agriculture forecast that the global rice supply will increase in the time ahead, drawing a gloomy picture of rice export of Vietnam and other countries.
By the end of May 5, 2019, Vietnam exported 2.76 million tonnes of rice valued at 1.18 billion USD, down 6.3 percent in volume and 20.4 percent in value against the same period last year.
Rice price stood at 427.5 USD per tonne, a decrease of 76.8 USD year-on-year, the Deputy Minister said.
Phan Van Chinh, Director of the Export-Import Department under the Ministry of Industry and Trade (MoIT), said in the first five months of 2019, China, Indonesia and Bangladesh imported only 239,000 tonnes of rice in total from Vietnam, as compared with over 1.44 million tonnes shipped to the three countries in the same period last year.
Bui Thi Thanh Tam, Vice President of the Vietnam Food Association, said the domestic rice sector is expected to face a range of challenges not only in 2019 but the years to come, firstly due to the increasing global rice volume which is forecast to exceed 499 million tonnes this year, up 4.2 million tonnes against the previous year.
Another reason is the large amount of rice stockpiles, she said, taking China as an example as the country’s rice stockpiles amount to about 116 million tonnes. China may replace the US to become a big rice exporter in the world.
Le Minh Duc, Director of the Department of Industry and Trade of the Mekong Delta province of Long An, pointed out shortcomings in the implementation of solutions that were rolled out to help remove difficulties facing rice exports.
He suggested the Ministry of Agriculture and Rural Development clearly defines the land area for rice cultivation to ensure national food security and rice exports at the same time, while adjusting rice crops to maintain rice quality and quantity, and reduce production costs.
The MoIT should step up trade promotion activities and maintain revenues of rice export to China, he said, calling on associations to assist enterprises in building brand names for Vietnamese rice.
Other delegates at the event proposed connectivity models between businesses and farmers in rice production and consumption in order to meet market requirements.
Apart from issuing mechanisms in support of rice purchase to stock reserves, relevant ministries and agencies need to better the market information work to help businesses set forth their purchasing plans, Khanh said.
MTA Vietnam slated to kick off next month
MTA Vietnam, an international exhibition on precision engineering, machine tools and the metalworking industry, is scheduled to take place from July 2 to 5 in HCMC’s District 7.
The three-day event will enable local firms to access a wide range of the world’s most modern equipment, machinery and technologies in the manufacturing industry in the Industry 4.0 era, BT Tee, general director at Informa Markets Vietnam, which organizes the event, told a press briefing on June 18.
Opening at the Saigon Exhibition and Convention Center, the 17th edition of the MTA Vietnam is customized to the local market and has got participation registrations from over 500 exhibitors from 22 countries and territories, he said.
The expo will also include 14 group pavilions from countries well-known for their high-quality precision engineering products, such as Germany, Japan and South Korea.
A designated zone called “We Are Industry 4.0 Ready” will be featured for the first time at the event, where visitors can access innovative and cost-effective ideas, solutions and equipment provided by leading industry 4.0 suppliers, according to the event organizer.
The Fourth Industrial Revolution is taking place globally, offering both opportunities and challenges for Vietnam. It is time for local firms to work out investment strategies based on applications in the 4.0 era to achieve sustainable growth, according to the Ministry of Industry and Trade.
Further, data recently released at the World Economic Forum showed that Vietnam is among countries that have yet to embrace change in the industrial revolution. It ranked 81st among 100 nations for a high-quality workforce and 90th out of 100 nations in terms of technology and innovation.
In addition, the local industrial sector has faced multiple obstacles in digitalization and applying advanced technologies and smart devices to production chains.
Shinhan Finance to debut in Vietnam early July
Shinhan Vietnam Finance Company receives its all business licenses, marking a milestone to officially introduce its brand to Vietnamese customers.
With effect from June 14, Prudential Vietnam Finance Company Ltd., (Prudential Finance) was approved to change its business name as Shinhan Vietnam Finance Company Ltd., (Shinhan Finance) according to Establishment License No. 51/GP-NHNN dated 03/05/2019 issued by the State Bank of Vietnam (SBV) and amended Enterprise Registration Certificate dated June 14th, 2019 issued by the HCMC Department of Planning and Investment.
In the coming weeks, the company will be doing a lot of building and testing behind the scenes, and working closely with the relevant parties such as customers, business partners and vendors, so that they can officially launch full current operations.
The change of company name is expected to not affect its existing good business relationships and transactions with its customers. The company is confident to continuously provide products and services of the highest quality to all parties concerned.
Shinhan Finance affirms that while its business name is changing, its legal status and office address remain the same. The company’s business remains fundamentally unaffected by this change and all contracts with existing customers will remain unaltered, with corresponding obligations and rights assumed under the new name. It means all of loan agreements customers signed with Prudential Finance or Shinhan Finance remain unchanged in terms of legal effect and the company’s collection partners continue to serve customers as usual.
Projects using public land face obstacles
Real estate projects that use public land in HCMC are now facing multiple obstacles as no specific measures or regulations are available to guide them. The municipal government has had to consult with competent agencies on problematic projects on a case-by-case basis.
The municipal government had to seek suggestions from the Department of Natural Resources and Environment on ways to manage housing projects that had completed investment procedures or were under construction, Vo Van Hoan, vice chairman of the municipal government, told a press briefing on June 20 in the city.
For projects that have not begun, the department will suggest multiple procedures, such as selling part of the public land to project investors while the remainder is put up for auction. If public land included in a project is extremely small, they can be handed over to the project’s investor, Hoan added.
Under prevailing regulations on public assets management, even one square meter of land must be put up for auction. In one instance, when the city wanted to auction off several square meters of land left after completing a road project, no one would purchase them; however, the city could not sell the land lot to buyers living near the road due to legal obstacles, Hoan said, adding that the city had reported the problem to the competent agencies repeatedly, but no action has been taken so far.
As for violations related to the construction process for 110 villas in the Green Star Sky Garden residential project in District 7, the vice chairman confirmed the project investor, Hung Loc Phat Company, had violated laws on land use and investment, as it did not have a land use right certificate when executing the project.
The city will suspend the project in 60 days and set up a team to inspect it in two weeks. Administrative punishment will be adopted later based on the inspection results. The city will take further steps once the investor receives the land use right certificate and is subject to the fine, Hoan added.
Japan to support Vietnamese securities market
Japanese experts will provide various services such as consultancy and capacity building to update internal operation guidelines and revise the related legal framework for the securities market in Vietnam, sources said.
Under the framework of a project funded by the Japan International Cooperation Agency (JICA), Japanese experts from Japan Exchange Group, Daiwa Research Institute and Nomura Research Institute will support the State Securities Commission (SSC) and the two stock exchanges (SEs) in Hanoi and HCMC.
At a seminar to launch the “Project for Capacity Building in Improving the Fairness and Transparency of the Vietnamese Equity Market” on June 20, JICA’s consulting team reported the key findings of a baseline survey of Vietnam’s securities market and market participants, providing a background for analysis and feasible solutions for its Vietnamese counterparts.
The project is aimed at bringing the best international practices to Vietnam during this important transition period, when the Securities Law is under scrutiny for revision; the “Strategy for the Restructuring of the Securities Market by 2020 with a vision toward 2025” has just been renewed; and the two SEs in Hanoi and HCMC will soon combine into a single Vietnam Stock Exchange.
The Record of Discussion of this Project, signed on November 5, 2018, set the foundation for the three-year project, aimed at improving the capacity of the SSC and two SEs in adopting measures to improve the fairness and transparency of the Vietnamese equity market.
Techniques and experiences will be shared with the Vietnamese counterparts to conduct market surveillance, supervise market intermediaries, manage listings and public offerings and raise the awareness of business leaders on investor protection.
From that, the project is expected to help bring more qualified products of State-owned and private enterprises to the market, as one of the factors involved in upgrading the stock market and contributing to socio-economic development.
Vietnam’s automobile imports from Indonesia surge in May
Statistics from the General Department of Vietnam Customs show that the country’s imports of completely-built-up (CBU) passenger cars from Indonesia amounted to 6,751 units in May, surging 84% against the month earlier and surpassing the purchase of Thai-made automobiles.
The volume of CBU vehicles of all types imported into Vietnam from Thailand was reported at 6,160 units in May, whereas the country purchased 6,755 CBU automobiles from Indonesia at the same time, making it Vietnam’s largest automobile supplier in May. The spot had belonged to Thailand in previous years.
Regarding passenger vehicles only, Vietnam imported 6,751 cars from Indonesia in May, some 2,500 more than the 4270 passenger cars imported from Thailand last month.
The country spent over US$1.4 billion importing 64,700 CBU cars of all kinds during the January-May period, with import value in May amounting to US$308 million for over 14,300 units, up 31.9% against April.
Besides this, Vietnam bought over 2,140 trucks valued at US$70.9 million in May, up 15% in volume and 23% in value versus the figures seen in April.
According to statistics, Thailand remained Vietnam’s largest automobile supplier in the first five months of the year, exporting more than 38,380 units worth US$763 million to Vietnam during the five-month period.
Indonesia came second, with over 19,477 vehicles valued at US$276 million imported into Vietnam over the first five months, followed by China, which exported 2,050 automobiles to the local market.
Local FMCG market shows positive outlook: Kantar Worldpanel
Market research firm Kantar Worldpanel predicts the Vietnamese fast-moving consumer goods (FMCG) sector will see a positive performance in Hanoi, Danang, HCMC and Can Tho and an acceleration of progress in rural areas over the long term.
The market research firm said in its latest FMCG monitor report that oil and electricity prices rose in April, but the consumer price index of the first four months was kept under control, posting the lowest rate for the same period over the last three years.
Also, the retail sales of consumer goods maintained its growth momentum, driven by the strong consumer demand for food and household appliances.
The firm projected the market will retain its growth momentum in both regions, mostly driven by the volume of consumption for the short term.
During the four-month period, all sectors saw healthy growth, mostly thanks to the increase in the volume of consumption. While personal care was the fastest growing sector in major cities, dairy products led FMCG growth in rural regions.
In major cities, oyster sauce enjoyed impressive growth in terms of both value and volume thanks to an increase in shopper numbers. Meanwhile, ice cream consumed at home is fast expanding its consumer base in rural areas, partly thanks to the increasing number of households with a freezer.
The market firm projected modern shopping channels will continue growing ahead of the total FMCG market at a double-digit pace in urban areas, thanks to gaining more shoppers.
In rural areas, medium-sized street shops are continuing to expand their presence, attracting a significant number of new shoppers. With a good start in the first four months, modern retail is expected to see greater achievements this year.
Most of the top 10 growing brands in terms of consumer reach are successfully expanding their reach. These brands have been acquiring an impressive number of additional households by catering to consumers’ evolving needs centered around health, convenience and happiness as well as bringing them an enhanced shopping experience.
Sagri general director Le Tan Hung dismissed
Le Tan Hung has been removed from the post of general director of State-owned company Saigon Agriculture Incorporated (Sagri) following his suspension from the post due to serious misconduct.
According to the local media, Nguyen Thanh Phong, chairman of the HCMC People's Committee, has signed a decision on Hung's dismissal.
Hung reportedly committed violations for years but failed to take remedial action. This indicated that he lacked leadership qualities, which would prevent him from running the company efficiently.
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 to create house rules and was responsible for the shortcomings and violations involving investment projects and in the use and management of land, finances and loans.
According to the HCMC inspectorate and the State Audit of Vietnam, multiple serious violations took place at Sagri, such as the misuse of 1,900 hectares of land and the transfer of land at lower-than-expected prices.
Moreover, during a short period from October 3 to November 1, 2016, Hung signed 10 contracts worth more than VND13 billion with two tour operators for Sagri employees’ overseas study trips.
However, 40 of the 70 employees were found to have avoided these trips, according to the Vietnam Immigration Office in HCMC.
Inspectors said there were signs of collusion between Sagri and the tour operators. They could have falsified accounting records and payments to cover up their actions.
Sagri, under the management of the HCMC government, was converted into a one-member limited liability company in 2010.
The company has six subordinate units, nine subsidiaries, 14 partners and a joint venture and has reported annual revenue of trillions of Vietnamese dong in recent years.
Market surveillance exposes loopholes
Many massive cases of smuggling and trade fraud have lately surfaced, boding ill for local production and putting the country’s foreign trade at risk. In several of such cases, the General Department of Market Surveillance under the Ministry of Industry and Trade, which is primarily tasked with fighting such irregularities, has failed to accomplish its role.
Just look at three recent large-scale cases of smuggling and trade fraud, and one will see how the market surveillance forces have performed poorly. In those cases – Khaisilk buying Chinese-made silk scarves and placing the Made-in-Vietnam tags on the products, My Hung in Soc Trang producing fake petrol products and launching millions of liters of fake fuel onto the market each month, and Asanzo doing the final stages of assembly of Chinese-made parts and components to sell them as Made-in-Vietnam electronic products – no efforts by market surveillance forces in busting such rings are recognized.
The common threads in the three cases are that the illegal businesses are of massive national scale and have been operational in the market for long years, and none of such cases are detected by market surveillance agencies. In the case of Khaisilk, the trade fraud, accidentally uncovered by a customer, is estimated to amount to tens of billions of Vietnamese dong a month; while in the My Hung case, the illegal ring was busted by Dak Nong Province police, with the value amounting to hundreds of billions a month; and in the latest case of Asanzo, brought to light by Tuoi Tre newspaper last week, the illicit trade is estimated at trillions a month.
Take Asanzo for example. Asanzo Vietnam has launched a wide range of electronic products on the shelves of many stores across the country, and the firm also boasts a market share of 15% for TVs alone. The company imported huge batches of components as well as finished products from China on a regular basis, assembled them, replaced the Chinese-made tag, and sold them as high-quality Vietnamese products. Its trade and production activities – just like Khaisilk and My Hung – had taken place for years, without being detected by market monitoring authorities.
Most of smuggling and trade fraud cases uncovered by market monitors have been petty ones, while large-scale rings have easily slipped through.
At a working session with Deputy PM Truong Hoa Binh in mid-February, the General Department of Market Surveillance reported that in 2018, market monitors detected over 90,000 violations, and imposed fines totaling VND500 billion. Such figures are trivial compared to large-scale rings mentioned above.
While petty cases of smuggling and trade fraud need to be checked and suppressed to ensure a healthy trading environment, it is large rings that should capture greater attention from the market monitoring department, as such cases threaten the stability of the local market, endanger the development of domestic producers and traders, and put Vietnam’s trade ties with global partners at stake. Other countries especially the United States are scrutinizing Chinese-made products entering their markets under the Vietnamese labels.
In the February meeting, Deputy PM Truong Hoa Binh also urged the General Department of Market Surveillance to enhance its capacity to deal with smuggling and trade fraud, and to quickly work out a framework to coordinate with customs, police, border guards and tax authorities to bolster and synergize the fight against such irregularities. Such remain the loopholes on the part of the General Department of Market Surveillance.
Payment security key in push towards digital economy
Cybersecurity has been raised recently as the most important issue for Vietnam and has become a prerequisite for the country’s successful national transition to a digital economy. This was also the primary issue for many regional organizations and authorities in discussions at the Asia Pacific Visa Security Summit 2019 held in Shanghai, China, on June 19 and 20.
The Summit was one of the largest payment security events in the region, bringing together leading risk professionals to share experience and best practice in payment security innovation. This year, more than 500 participants gathered to hear how the industry can continue to collaborate in the years to come.
Payment security trends this year include in-person payment fraud continuing to decline, growth in e-commerce driving need for secure digital payments, and the increased adoption of biometrics.
Vietnam is building its own digital transformation roadmap by improving cybersecurity to create a digital society as the domestic digital payment and e-commerce industries experience a boom in recent years. On that journey, Visa - the world’s leader in digital payments - has committed to working with local banks and other financial organizations around the country to prevent potential attacks with a portfolio of risk products and services.
As Vietnam has been among the most cyber-attacked countries, especially regarding payment security, Visa has been issuing security alerts in the past year to all Vietnamese banks and local authorities. “We have been constantly working with banks on updated technologies to ensure implementation,” said Mr. Sriraman Shivakumar, Head of Risk at Visa Southeast Asia. “We also continue discussions and partnerships with industry bodies to exchange knowledge on cyber-security.”
Digital payments continue to grow across Asia-Pacific as consumers become more active users of e-commerce and rapidly adopt cashless methods of transactions. Central banks and regulators are also implementing digital initiatives to reap the benefits of digital payments, which include greater transaction convenience, bolstering innovation, and lowering costs associated with cash handling. These developments have also created a proliferation of data, which is increasingly attractive to cybercriminals.
“Almost every government in Asia-Pacific is focused on driving a digitization agenda, reducing the reliance on cash and checks,” said Mr. Joe Cunningham, Head of Risk at Visa Asia Pacific. “This has created tremendous opportunities for digital payment innovations. The payments industry generates significant amounts of data, some of which is sensitive and attractive to criminal organizations. We play a unique role in protecting the security and integrity of the payment ecosystem, to the benefit of merchants, cardholders, and all our clients. We continuously invest to ensure Visa remains the most innovative, reliable, and secure digital payment network.”
The rewards of innovation are double-edged. As the threat of cybercrime becomes more sophisticated and pervasive, Visa, together with the industry, is pioneering new ways and solutions to secure e-commerce and prevent potential attacks.
With e-commerce sales in Asia-Pacific expected to reach $3.5 trillion in 2021, further cementing the region as the largest market in the world for online shopping, technologies like tokenization will help ensure no token details are transmitted during an online transaction. Visa Token Service replaces sensitive account information, such as a 16-digit account number, with a unique digital identifier called a token. This token allows payments to be processed without exposing actual account details that could potentially be compromised.
“We envisage a future free from passwords, where consumers enjoy the benefits of advanced technology to authenticate their identity,” Mr. Cunningham said. “A future with less fraud and less friction. As governments and businesses look to expand new ways to pay, Visa is committed to collaborating with partners to develop and invest in security standards that deliver a safer, secure, and seamless commerce experience.”
Second shareholders' meeting of Eximbank fails
Eximbank once again failed to get its shareholders' meeting to approve its new regulations to keep carrying out the second shareholder meeting and changes to its management board.
After the failure of its first shareholders' meeting (AGM) in late April, Vietnam Export Import Commercial Bank (Eximbank) organised a second meeting on June 21 with the participation of nearly 94 per cent of its shares.
Contrary to forecasts of a smooth session after prolonged personnel crisis,the second meeting stalled over arguments over the legitimacy of the assigment of the new chairman of Eximbank's management board, Cao Xuan Ninh.
Objecting shareholders' doubts, Ninh said the State Bank of Vietnam’s (SBV) Banking Supervision Agency has affirmed that the bank’s proposals for the general meeting are in line with local regulations.
“We will set private meetings to clear up the queries of shareholders,” Ninh said after seeing many hands raised for comments.
A large number of shareholders disagreed with the proposal because all problems should be openly discussed, especially those arising at a shareholders' meeting, the main purpose of which is the open discussion of issues with shareholders.
A representative of Sumitomo Mitsui Banking Corporation – Eximbank’s strategic partner holding 15 per cent of its capital – stated after the AGM that during the two-hour argument, the shareholders did not believe the management board, including chairman Cao Xuan Ninh and authorised general director Nguyen Canh Vinh.
Ninh said that he was sorry for Eximbank’s internal problems, which relegated the bank from one of the top five leading local banks to the three weakest. He also asked for comments to adjust the bank’s regulations to continue the shareholders' meeting. However, the requirement was not approved.
Eximbank set a growth target of 30 per cent or VND1.077 trillion ($46.82 million) in pre-tax profit, and raising its total asset value to VND181 trillion ($7.87 billion). The mobilised capital is expected to hit VND143.5 trillion ($6.24 billion).
In the morning of April 26, Eximbank organised the first shareholders' meeting, but the meeting had to be halted due to low attendance.
Grassroots health services in Vietnam to be improved
The World Bank's Board of Executive Directors has just approved an $80 million loan to help Vietnam improve the quality of and access to basic health services in 13 provinces, with a focus on poor areas.
The project on investing and innovating for grassroots health service delivery is designed to enable commune health stations (CHS) to start detecting and managing non-communicable diseases while strengthening their existing role in controlling infectious diseases and providing essential maternal, newborn, and child healthcare services. About 9.2 million people are expected to directly benefit from investments under this project.
To do this the project will provide CHS with equipment, training, and quality management tools, while upgrading infrastructure to meet national standards. The project will also support policy reforms that improve the financial sustainability and quality of services, and pilot innovations.
“While health outcomes and access to basic health services have improved tremendously for the general population, disadvantaged groups, especially ethnic minorities, and those living in poor, remote, and mountainous provinces, still lag behind,” said Ousmane Dione, World Bank country director for Vietnam.
"This project is designed to target these groups by closing remaining gaps in access to basic healthcare while expanding new services to address emerging demographic and epidemiological challenges.”
The 13 provinces covered by the project are Ha Giang, Bac Kan, Yen Bai, Son La, and Hoa Binh (in the north); Quang Binh, Quang Tri, Quang Ngai, and Ninh Thuan (in the central region); and Long An, Tra Vinh, Hau Giang, and Bac Lieu (in the south). All but one of the provinces have poverty rates higher than the national average, and nine of them are in the poorest third of all provinces nationwide.
In addition to the $80 million loan provided through the International Development Association (IDA), the financing package also includes grants totaling $25 million. These comprise $17 million from the Global Financing Facility for Women, Children and Adolescents to soften (“buy-down”) the interest rate of the loan, $5 million from the Integrating Donor-Financed Health Programs Multi-Donor Trust Fund, and $3 million from the Tackling Non-Communicable Diseases Challenges in Low and Middle-Income Countries Multi-Donor Trust Fund. In-kind contributions from Gavi and the Vaccine Alliance will also be provided.
“The Global Financing Facility (GFF) is pleased to partner with the Government of Vietnam to support its commitment to improving the health and nutrition of the country’s poorest and most vulnerable citizens,” said Monique Vledder, who leads the GFF secretariat. “The government’s leadership in investing in quality primary healthcare systems will help save and improve the lives of women, children, and adolescents for years to come.”
German businesses eye expansion in Vietnam
More German companies are interested in expanding operations in Vietnam in the future to benefit from the local economic growth and free trade agreements.
The German Industry and Commerce Vietnam on June 20 announced the AHK World Business Outlook (AHK WBO) 2019 based on a regular DIHK survey among member companies of the German Chamber of Commerce Abroad, delegations and representative offices (AHK).
AHK WBO encompasses feedback from more than 3,500 German companies, branches, and subsidiaries worldwide and in Vietnam as well as international companies with close links to Germany.
Thanks to the active participation of German companies in Vietnam and across the globe, AHK WBO is seen by leaders, decisionmakers, entrepreneurs, media, and business professionals globally and in Vietnam as a barometer of the business confidence among German companies and as a key indicator of German business situation, as well as business and economic expectations.
In Vietnam: 30 per cent of respondents stemmed from industry and construction, 27 per cent from the service sector, and a further 43 per cent from the retail trade. Small companies with less than 100 employees account for 42 per cent of responses. 21 per cent of the companies employ 100 to 1,000 employees. Large companies with more than 1,000 employees account for 37 per cent of the respondents.
2018 was a successful year for Vietnam with a number of positive developments, such as the GDP growth (7.1 per cent) or FDI disbursement ($13 billion). Similar to FDI, export-import turnover reached a new record high of $465 billion with an export surplus of $13 billion. The Vietnamese government shows commitment to support and create the most favourable conditions for foreign investors and businesses.
In addition, a wide range of free trade agreements such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the EU-Vietnam Free Trade Agreement (EVFTA), which probably comes into effect this summer, will boost the economic growth of this country.
That might be the reason German business leaders in Vietnam maintain a positive view with the economic prospects as well as with their situation in Vietnam and they look forward to a bright 2019 and 2020.
Experts have forecast that the Vietnamese economy will continue to grow by 7 per cent this year thanks to export turnover and the drastic development of the manufacturing, processing, and services sectors as well as Vietnam's integration into the world economy.
While 52 per cent had a positive view of the local economic development in 2018, 67 per cent expects an improvement in April 2019. Half of the companies (51 per cent) claim conditions regarding the economic policy framework to be the greatest risk for their businesses in Vietnam. 28 per cent is afraid of disadvantages due to trade barriers.
German businesses operating in Vietnam assess both their own business situation and future business expectations significantly better than in 2018. 77 per cent rate their current business situation in Vietnam as good and 3 per cent as poor. While in 2018 only 56 per cent had a positive view of their situation in Vietnam. The balance points increased from 52 points to 74 points. The great increase in business expectations is really surprising. While the positive ratings rise from 56 to 72 per cent, the number of negative ratings fell from 4 to 0 per cent. Accordingly, the balance climbed significantly from 52 to 72 point implying a high level of German business confidence in Vietnam.
55 per cent of German companies in Vietnam intend to expand their activities in Vietnam and 59 per cent assume an increase in employment.
Concerns about the economic policy framework are increasing. After 44 per cent in 2018, 51 per cent of companies cite economic policy as the greatest factor of uncertainty for their businesses in 2019 in Vietnam.
Other issues such as the lack of skilled workers as well as labour costs might threaten their businesses here.
The conclusion of RCEP (Regional Comprehensive Economic Partnership), domestic and international demand as well as political stability have a very high influence on German engagement in Vietnam, as can be seen in market supply and demand as well as economic environment.
Germany and Vietnam have excellent economic relations and Germany enjoys an outstanding reputation in Vietnam which is really unique in this form in the ASEAN region. 46 per cent of German companies agree with this.
One of the concerns is how to support domestic businesses in order to enhance their competitiveness and to ensure sustainable development, because they are seen as the backbone of the economy in Vietnam.
Building and developing domestic supporting industries, as well as industrial clusters capitalising on the unique advantages of each region can help to create collaboration opportunities among domestic and foreign businesses. Therefore, businesses can easily develop together by taking advantage of experience and technological exchanges. Foreign-invested businesses account for 73 per cent of the export value and more than 50 per cent of the overall industry output, while domestic businesses only produce a small amount of output, both quantitatively and qualitatively, compared to FDI businesses.
Second, developing a practice-oriented vocational education system with the opportunities learning by doing will help to build a new skilled generation with profound knowledge, practical, and communicative skills. This could be a competitive advantage of Vietnam which can assure sustainable development in the long run.
Last but not least, building a fruitful and creative ecosystem for startups as well as providing financial, educational, and environmental assistance will give domestic startup companies as well as small- and medium-sized businesses the ability to reach foreign investors and modern technology.
AEON to develop $280 million shopping mall in Hanoi
AEON Co., Ltd. plans to develop another shopping mall in Hanoi with the total investment capital of $280 million, increasing the total number of its malls in Hanoi to three.
On June 20, Prime Minister Nguyen Xuan Phuc had a meeting with Yasutsugu Iwamura, general director of AEON MALL Vietnam. The prime minister lauded AEON Vietnam’s effort to increase the export of Vietnamese goods to Japan and encouraged the group to continue expanding its operations in Vietnam as well as increase exports.
Yasutsugu Iwamura reported its plans to develop a shopping mall in the south of Hanoi and expected to receive support from the government and relevant authorities.
At present, AEON MALL Vietnam is operating four shopping malls in Vietnam and two other ones are under construction. Along with expanding the operations in Vietnam, the group is also increasing connections with local suppliers and manufacturers to export their products to Japan.
Most recently, AEON Co., Ltd., AEON Vietnam Co., Ltd., and AEON TOPVALU Vietnam Co., Ltd. organised the annual AEON supplier conference for the first time with the aim of promoting the export of Vietnamese goods to Japan, drawing the attendance of representatives of authorities from Vietnam and Japan, and 142 valued domestic and foreign suppliers.
The AEON Supplier Conference is an opportunity to deepen bonds with the company's suppliers by connecting and supporting them to generate innovative business ideas and enhance high-quality products to meet the increasing demand of domestic consumers and export to overseas markets.
AEON has been making efforts to contribute to local industries, thus exports from Vietnam to AEON's worldwide network increased in the 2018 fiscal year with the total export turnover of $240 million. The figure is expected to reach $500 million in the 2020 fiscal year and $1 billion in the 2025 fiscal year.