Solar power struggles to gain traction despite rapid development
Despite the recent boom in solar power projects in Vietnam, this renewable energy still meets only a small proportion of the country’s total electricity demand, at 27 million out of the 750 million kilowatt hours needed per day.
At a seminar on August 24, Vo Quang Lam, deputy general director of Vietnam Electricity Group (EVN), noted that the total power capacity of Vietnam is 48,000 megawatts. However, only 39,000 megawatts of electricity is being utilized, the local media reported.
With demand for power growing by 10% each year, 43,000 megawatts of electricity will be needed next year.
Solar power can help meet part of the demand, while the country currently depends on coal-fired and gas-fired power and hydropower.
Under the adjusted National Power Development Plan VII, the total solar power capacity was expected to reach 850 megawatts by 2020, but the current capacity is already 4,500 megawatts and will hit 7,700 megawatts by 2020.
In addition, it takes eight to 10 months to build a renewable power plant but three to five years to develop a transmission line, raising difficulties in connecting these plants to the national grid, Lam added.
Ha Dang Son, director of the Center for Energy and Green Growth Research, stated that the country’s hydropower potential is almost exhausted, so Vietnam should diversify its energy resources.
Lam noted that EVN will continue asking the Government to remove obstacles to attract more investors to the energy sector.
Guangdong Import and Export Fair opens in Hanoi
The 2019 Guangdong (China) Import and Export Fair kicked off in Vietnam’s capital city of Hanoi on August 28.
On display are various products like rice, coffee, rubber, cotton, garment accessories, handicrafts, cooking utensils and electric equipment.
The fair offers Vietnamese businesses a chance to meet producers and discuss cooperation in such areas as machinery, electric equipment and electronics; LED and lighting technology; construction materials and furniture; fashion, household utensils and food; high-tech products and accessories.
More than 3,000 potential buyers were invited to the event to participate in a business networking programme.
Speaking at the opening ceremony, Vietnamese Deputy Minister of Industry and Trade Do Thang Hai described the fair as a bridge helping businesses of the two countries connect and seek cooperation opportunities in trade, investment and tourism, helping to enhance cooperation between Vietnam and China as well as Guangdong in particular.
Vice Governor of Guangdong province Ouyang Weimin said China is Vietnam’s biggest trade partner and Guangdong is the country’s pioneer partner in economic and trade cooperation as well as friendship exchange.
Statistics from the General Department of Vietnam Customs show that Vietnam - China trade turnover reached 106.7 billion USD in 2018, up 13.5 percent year-on-year. In the first six months of 2019, the bilateral trade hit 52.36 billion USD, up 11.8 percent.
Currently, 110 enterprises of Guangdong province are investing in Vietnam and the number is expected to increase in the time ahead.
Trade between Vietnam and Guangdong exceeded 37 billion USD last year, accounting for a quarter of the total import-export turnover between Vietnam and China.
A trade and investment forum was held within the framework of the fair the same day.
Johnson Choi, Acting Chairman of the Hong Kong-Vietnam Chamber of Commerce and Executive Director of Sunwah Group, said Vietnam boasts advantages in terms of infrastructure, economy, technology and others.
The Vietnamese Government has rolled out many preferential policies in an effort to attract foreign investors, he said, adding that many partners of Sunwah have talked about projects they want to invest in Vietnam.
Zheng Jianrong, Director General of Guangdong’s Department of Commerce, said as of the end of 2018, Guangdong had invested a combined 250 million USD in Vietnam.
Vietnam has become Guangdong’s largest trade partner in the Association of Southeast Asian Nations (ASEAN) and received most investment from the Chinese province, he said.
NA yet to endorse State capital for Trung Luong-My Thuan expressway
Despite the Government’s written request for the State to invest over VND2.1 trillion in the Trung Luong-My Thuan expressway, the National Assembly (NA) Standing Committee has yet to approve it, according to BOT Trung Luong-My Thuan Joint Stock Company.
As the committee has yet to endorse the State’s investment, a plan for the use of the capital and disbursement periods will be difficult to draw up, the firm’s representative told the press on August 26 in Tien Giang Province.
Apart from financial support from the State budget, the project has two other sources of capital: the investor’s equity and bank loans. However, the bank loans have yet to be disbursed either.
Mai Manh Hong, general director of BOT Trung Luong-My Thuan Joint Stock Company, noted that the project will not be opened to traffic in 2020 due to the lack of funding.
“The completion of the expressway depends on the capital,” he insisted.
Hong, however, asserted that putting the project into operation in 2020 is feasible if the funding is sufficient and there are no complicated disbursement procedures.
The NA Standing Committee is expected to decide on the plan to allocate capital for the Trung Luong-My Thuan expressway at a meeting in September, he said, adding that if the plan is passed, the project may be opened to traffic as scheduled.
The investor has spent some VND2.5 trillion on site clearance, compensation and other construction activities for the project. Work on the expressway project, which is 25% complete, is being sped up.
The four-lane expressway, which is some 51 kilometers long including access roads stretching 4.5 kilometers, will run through five outlying districts of the Mekong Delta province of Tien Giang. It will start at the intersection of the Than Cuu Nghia T-Junction and the HCMC-Trung Luong Expressway and end at the intersection with National Highway 30.
The expressway, once in place, will shorten the distance and travel time between HCMC and the Mekong Delta provinces, bolster the socioeconomic growth of Vietnam’s southwestern region and reduce traffic congestion on National Highway 1.
Startup raises US$5.2 million from BIP Capital
Kobiton, an Atlanta-based mobile app testing platform project developed by a Vietnamese team of engineers, has announced that it raised US$5.2 million in a Series A round, led by BIP Capital.
Earlier, Kobiton had raised US$3 million in seed funding from Kinetic Ventures. With a combined US$8 million raised in two rounds, Kobiton will use the funding to expand its marketing, customer support, and product development efforts
The Kobiton platform allows corporate customers and tech firms to test their mobile apps on actual devices in a cost-effective and time-efficient manner.
More than 500 firms and 35,000 testers and developers have used the Kobiton platform, to date, including major customers such as Capgemini, Frontier Airlines, and GreenSky.
In 2016, a team of five Vietnamese engineers from KMS Technology developed the Kobiton project. Two years later, Kobiton set up its headquarters in Atlanta, USA. Among them, Vietnamese engineers accounted for over 30 of its 40 employees.
Kobiton is being further developed, adding a new “Record & Playback” feature using artificial intelligence (AI).
Dan Drechsel, deputy director of BIP Capital, said that many companies had faced multiple obstacles when conducting automated testing on a large scale. To help remove such obstacles, Kobiton’s mobile testing platform offers them on-device testing services, coupled with AI-powered scriptless test automation technology.
Banks told to be alert to corporate bond issuance risks
The State Bank of Vietnam (SBV) has asked commercial banks to be vigilant about their corporate bond investments, especially those in the real estate sector, in order to minimize their risks.
A number of banks have invested heavily in corporate bonds, accounting for increasingly large proportions of their total assets, according to the SBV.
The central bank noted that their corporate bond investments in the construction and real estate sectors pose a significant risk, since the property market has yet to make a sustained recovery, and businesses in both sectors still face many difficulties.
Also, commercial banks have been ordered to refrain from purchasing corporate bonds for the purpose of restructuring debts of issuing enterprises, and they must also take post-lending supervision measures to reduce their bad debts.
At a conference earlier this month, Deputy Prime Minister Vuong Dinh Hue called for stricter supervision on the issuance of corporate bonds, so that the finance and equity sectors operate properly and safely.
The senior Cabinet leader asked the Ministry of Finance, the State Securities Commission and the SBV to supervise the corporate bond market carefully and create a development plan for the market, which should include lending limits, conditions and ratings.
The move came after a number of enterprises, especially property developers, have offered corporate bonds with high volumes and attractive yield rates of up to 14-15% per annum, which puts pressure on the financial and banking system.
Officials noted that although the corporate bond market needs to be developed in order to reduce the dependence of the economy on commercial banks, corporate bond issuance must be transparent and secure.
Additionally, high yield rates for real estate firms’ corporate bonds must be closely watched, as they may have an impact on the Government’s macroeconomic policies.
Data from the Ministry of Finance shows that total corporate bond sales exceeded VND116 trillion (US$4.9 billion) in the first half of 2019, up 7.4% from one year ago, while some VND36.7 trillion was issued by commercial banks, accounting for 36% of the total.
As of late June, the capitalization of the corporate bond market was equal to 10.2% of the country’s gross domestic product, surpassing the set target of 7% in 2020.
Foreign startups seek opportunities at startup exchange
Forty-eight foreign startups from 11 countries, including the U.S., Canada, and Thailand, displayed their products at the local Startup Exchange on August 23 in HCMC, while competing with 150 local startups to boost the promotion of trade in Vietnam.
With a large and young population, Vietnam is considered a potential market for international startups. The fact that young Vietnamese are interested in new experiences will create opportunities for tech startups to expand their business in the country, said executives from foreign startups at the event.
South Korea’s MK Biotech company, which showcased biotechnology at the event to produce stem cells, said its products have been welcomed by food producers and medical organizations that use stem cells for the treatment of diseases. The firm also studies cloning techniques.
The South Korean firm is expected to sell into the local food producing segment, by using its technology to produce beef.
Meanwhile, Naver, a startup specializing in manufacturing motorcycle helmet headphones, said that Vietnam, Indonesia and Thailand are potential markets from which the firm can easily expand its business scale to other countries.
The foreign startups added that they will adjust their products and business models to meet the demand of the local market.
Nguyen Thi Dieu Hang, director of the Business Startup Support Center (BSSC), said that the South Korean and Thai startups accounted for the majority of foreign participants at the event. These startups operate in the fields of education, fintech, while deploying artificial intelligence, virtual reality and biotechnology, among others.
Aside from presenting their products and services to investors and judges, employees of foreign startups had numerous opportunities to meet members of the local startup ecosystem, such as mentors, universities, institutes, incubators and many local startups, to bolster trade in the country.
The Startup Exchange is part of an annual program, called Vietnam Startup Day hosted by BSSC. The exchange has attracted the participation of nearly 200 startups at home and abroad this year.
High inventory keeps pepper prices fluctuating
Black pepper supplies currently exceed the demand, with the inventories of major producers, including Vietnam, on the rise.
As international organizations forecast, the production of black pepper picked up by 5.5% per year in the 2012-2017 period, whereas demand increased by only 2.4% per year.
According to the International Pepper Community, global pepper production will rise to one million tons by 2050. Pepper demand will also increase but will be lower than the supply. Therefore, pepper prices will remain unstable for a while.
As the Ministry of Industry and Trade reported at a conference on the sustainable development of pepper in Dak Nong Province on August 22, the price decline in 2018 has left an impact on Vietnam’s black pepper industry. As a result, despite the increased export volume, the export value dropped significantly.
In the first half of this year, pepper exports struggled due to the low price, excessive supply and tough competition on the world market. Vietnam exported over 180,000 tons of pepper in the January-June period, worth US$463.3 million, up 34.1% in volume but down 1% in value against the same period a year earlier.
According to the trade ministry’s Import-Export Department, the declining pepper price has resulted from global supply increases. In Vietnam, the pepper quality has partly been affected by the overuse of chemicals and plant protection products, causing prices to drop below those of some other countries.
In addition, productivity in the pepper industry is declining, making it harder to compete with other pepper producers.
Data from the Ministry of Agriculture and Rural Development revealed that Vietnam has some 100,000 hectares of pepper with productivity averaging 2.47 tons per hectare, totaling some 247,000 tons. The productivity is quite low compared with those seen among other major pepper producers.
Vietnam’s pepper used to take the lead in terms of productivity and volume five years ago. However, in the past two years, countries such as Brazil, India and Indonesia have become strong competitors. Pepper from Brazil, for instance, is of high quality, and 80% of the volume sold globally meets organic requirements.
While pepper prices are staying low, production costs are on the rise. The cost of producing Vietnam’s pepper went up at least 10% last year against 2017, but the price dropped by more than 30%.
Nedspice research showed that pepper supplies in the 2017-2030 period are forecast to reach between 420,000 tons and 670,000 tons, depending on Vietnam’s pepper supply. Prices will decline as Vietnam’s supply rises.
The three countries that might expand their pepper production and exports in the coming months are Cambodia, Vietnam and Brazil.
Pepper production in Vietnam has doubled in the past 10 years and accounted for 43% of the global volume. Vietnam’s supplies might further increase in the coming years, reaching 210,000-350,000 tons in the 2017-2030 period.
India seeks to tap MICE tourism potential in Danang
The Network of Indian MICE Agents (NIMA) and Tours and Travels Association of Andhra Pradesh (TTAA) signed a memorandum of understanding on meetings, incentives, conferences and exhibitions (MICE) tourism cooperation with Danang Travel Association on August 22.
Under the MOU, the two Indian organizations will help market MICE tourism products in the central coastal city of Danang among Indian residents.
TTAA Chairman K. Vijay Mohan noted that he was willing to help Danang City organize large roadshows to promote tourism products and services to the Indian market.
Mohan added that many firms active in MICE tourism services appreciated the city’s potential for MICE tourism and its capacity to welcome large groups of Indian tourists. He agreed to carefully study the facilities of convention centers in the city, typically the Ariyana Convention Center, where many international MICE events have taken place.
Cao Tri Dung, chairman of Danang Travel Association, expected DTA and TTAA to bring many visitors, mainly from Mumbai, to Danang City and also encouraged tourists from the city to travel to India, aiming to promote both countries’ tourism sectors.
“We are preparing to build some modern convention centers with a capacity of 700-2,000 seats,” Deputy Director of the municipal Tourism Department Nguyen Xuan Binh said, adding that this will allow Danang City to welcome large groups of MICE tourists from India.
Besides this, Mohan and Binh agreed to speed up the launch of direct air routes from Mumbai and New Delhi to Danang City.
Binh remarked that next year, the Danang Tourism Promotion Center and the Danang Department of Tourism will collaborate with travel firms to launch more tourism promotion programs and activities in India.
In late July, a delegation of Danang-based firms and the Danang Tourism Promotion Center held a conference in Mumbai to introduce the city’s tourism sites to the Indian community. The event attracted some 100 Indian enterprises.
Politburo orders review of security at foreign-invested projects
In its newly issued resolution, the Politburo orders a review of security at foreign-invested projects in the country as part of a plan aimed at improving the quality of foreign investment.
Over the past 30 years, foreign-invested enterprises have grown significantly, contributing greatly to the country’s socioeconomic development, Thanh Nien newspaper reported.
Many multinational corporations with advanced technology have entered the country, creating more jobs for locals, improving local production capacity and increasing State budget revenue.
However, the attraction and management of foreign investment have also had shortcomings, such as gaps between policies and development requirements, ineffective preferential policies, an unhealthy investment environment, poor competitiveness and low quality of foreign investment.
The Politburo said that transfer pricing and unauthorized investment are on the rise. Several enterprises have misused natural resources and land and violated policies and regulations on labor, salary, tax and the environment, leading to disputes and lawsuits both at home and abroad.
The Politburo attributed these shortcomings to the irresponsibility of the relevant agencies, random approvals of foreign-invested projects, the poor capability of the executives in charge of attracting and managing foreign investment activity and light penalties for violations.
Although foreign investors are offered favorable conditions, foreign-invested projects should be selected based on their quality, effectiveness, technology and environment protection.
The Politburo wants Vietnam to be listed among the ASEAN 4 countries with the best business environment by 2021 and among ASEAN 3 by 2030.
To achieve the target, the legal system must be adjusted to remove shortcomings. Regulations that address the lack of capital, transfer pricing and unauthorized investment should be issued.
Moreover, the Politburo ordered adding regulations on the process of reviewing and approving new foreign investment projects to ensure national security and defense.
The list of restricted projects must be issued in line with international commitments. Investors in projects that are not included on the list will be treated like domestic investors.
The competent agencies should also draw up criteria for choosing investment projects, prioritizing those that match the development plans of sectors and localities, and issue regulations on the responsibility of investors for ensuring environmental protection during their operations in Vietnam.
The Politburo set a target to attract US$150-200 billion in the 2021-2025 period and US$200-300 billion over the next five years.
In addition, the proportion of enterprises applying advanced technology to environmental protection is expected to increase by 50% by 2025 and 100% by 2030 compared with last year’s figures.
The localization rate is expected to increase to 30% in 2025 and 40% in 2030 from the current 20%-25%. Further, the proportion of trained laborers is projected to rise from 56% in 2017 to 70% in 2025 and 80% in 2030.
Errors attract disciplinary measures in HCMC’s first metro line project
A dozen individuals and organizations in District 1, HCMC, have been held accountable for their shortcomings in the process of developing the city’s first metro line, which connects the downtown Ben Thanh Market with Suoi Tien Theme Park in District 9.
Chairman of District 1 Nguyen Van Dung sent a report to the HCMC government on the action to be taken against those found responsible for compromising the project, following a report issued by the State Audit of Vietnam (SAV) last December.
The chairman held a meeting on August 13 to look into the shortcomings and errors, largely made by the Compensation and Site Clearance Board of District 1 and District 1 Public Services Co., Ltd.
The former head and deputy head of the compensation board, Le Quoc Cuong and Tran Quang Cuong, were among those considered for disciplinary action. Le Quoc Cuong was earlier charged with abusing his power and position while on duty.
Other individuals under the microscope are leaders and officials of various divisions of the board.
According to the SAV, the HCMC People’s Committee was named for overstepping its power in making adjustments to the metro line’s investment plan.
A 2010 resolution issued by the National Assembly requires all public projects with total investment of VND35 trillion (US$1.5 billion) or more to be approved by the legislature, due to their national importance.
Despite this, the municipal government made the decision in 2011 to raise the project’s capital from the initial tally of nearly VND17.4 trillion to more than VND47.3 trillion, without seeking approval from lawmakers. It did so without clarifying where the additional capital would come from or assessing investment efficiency.
The SAV estimated that the project’s adjusted cost should have been only VND29.2 trillion, due to escalating prices and other changes. However, its actual costs rose by more than VND18.1 trillion.
The Management Authority for Urban Railways of HCMC blamed the cost increase on changes in construction material prices and minimum wage increases between 2006 and 2009.
The SAV demanded the city government recover more than VND2 billion for the State budget.
The sum includes some VND1.6 billion for a fund that provides compensation to households whose land was reclaimed to make room for the project, roughly VND350 billion for the relocation of the statues of hero Tran Nguyen Han and heroine Quanh Thi Trang, as well as nearly VND46 million for the demolition of a construction site at No. 39 Le Loi Street.
The SAV also found that the board had misallocated compensation of more than VND22 billion for six components, due to their miscalculations of locations, project area sizes, prices and volumes.
The Ben Thanh-Suoi Tien metro line stretches 19.7 kilometers between districts 1 and 9. It consists of a 2.6-kilometer underground section and a 17.1-kilometer overhead section, with three underground and 11 elevated stations.
The route was initially scheduled for completion in 2017, but the deadline had to be extended to 2020, owing to problems with compensation, site clearance and long delays in capital allocations.
Once in place, the route is expected to relieve traffic congestion at the eastern gateway of HCMC and boost the sustainable development of the southern economic hub.
Agricultural firms yet to capitalize on EVFTA
Enterprises active in the agro-forestry-fishery sector are not yet ready to make the most of the recently-signed European Union-Vietnam Free Trade Agreement (EVFTA), heard attendees at a conference on August 21.
Dau Anh Tuan, head of the Legal Department at the Vietnam Chamber of Commerce and Industry (VCCI), said that the European market is the country’s second largest importer, after China, but local firms are still having difficulty accessing this market.
Tuan was speaking at “EVFTA: Important commitments in the agriculture field and some notes,” co-held by the Ministry of Industry and Trade, the Ministry of Agriculture and Rural Development and the VCCI.
The modest number of agricultural firms has kept competition low, Tuan remarked, adding that Vietnam, despite being an agricultural nation, had a mere 9,230 enterprises operating in the agro-forestry-fishery sector in 2018.
However, over the past three years, many firms have joined the agricultural sector. In 2018, there were some 2,200 newly established agricultural firms.
Vietnam and the EU signed the EVFTA in Hanoi on June 30, but local firms have shown little sign of preparing to take advantage of the free trade agreement.
Tuan noted that most firms did not have enough experience or opportunities in international business due to their small operations, resulting in their poor preparation for capitalizing on the pact.
Addressing the conference, Minister of Agriculture and Rural Development Nguyen Xuan Cuong said that the agricultural sector is facing nontariff barriers, with the European market tightening control over the origin and safety of farm produce. Firms operating on a small scale have failed to meet the stringent requirements set by the selective market.
The husbandry sector was considered the most vulnerable in the wake of Vietnam joining the EVFTA as the prices of products from the local husbandry industry are still much higher than those from the 28 EU countries, he said.
Farming households should forge close ties to create a smooth production process, from buying input materials, processing products and providing them to consumers to exporting their products to foreign markets, as some 8.6 million farming households have yet to form any connections with each other, according to Cuong.
Connections between farming households will help prevent diseases, ensure the safety of the farming environment and increase the competitiveness of products.
Minister of Industry and Trade Tran Tuan Anh stated that the ministry will work with the Ministry of Agriculture and Rural Development to enhance the growth of the agricultural sector and expand consumption markets to help farmers and agricultural firms benefit from the EVFTA. In addition, the ministry will handle trade disputes and restructure the agriculture industry to boost efficiency in agricultural production.
The EVFTA will be sent to European Parliament and Vietnam's National Assembly for ratification. It is expected to come into force next year.
Foreign investors in Binh Duong compete for workers
While foreign investors are trying to set up factories in the southern province of Binh Duong, they are also suffering an acute shortage of laborers, resulting in fierce competition for manpower.
Speaking at a meeting between the provincial government and Taiwanese investors on Wednesday, Wu Chun-ying, president of the Binh Duong-based Taiwan Business Association, noted that many factories owned by Taiwanese firms are finding it challenging to recruit employees, due to the lack of available manpower.
Wu stated that this has led to high turnover as employees are being lured away by the competition. Many businesses have offered attractive salaries, resulting in high production costs.
If the situation is not resolved, these factories will have difficulty doing business, he said.
He told The Saigon Times on the sidelines of the meeting that Taiwanese firms are facing shortages of both skilled and unskilled laborers. Some new investors who are trying to increase their workforce have resorted to luring away employees from existing factories by paying salaries up to 50% higher than their previous jobs.
Businesses operating in the province’s Bau Trang Industrial Park are also suffering a lack of laborers, said Richard Tsai, chairman and chief executive officer of DDK Group, a Taiwanese company that manufactures bike saddles.
He added that many Taiwanese investors who had set up new factories in the park are in dire need of more than 10,000 employees. Therefore, he urged the provincial government to encourage more laborers to work there.
A representative of the provincial Department of Labor, Invalids and Social Affairs claimed that the scarcity of employees is not only affecting Taiwanese businesses but also investors from other countries and territories.
The department has already established ties with job placement centers in the province and neighboring localities but has yet to adequately address the situation.
The representative pointed out that if businesses offer strong benefits, such as providing accommodation and paying phone and gasoline costs for their employees, they may face less competition for workers.
Also, vocational training will further intensify through coordination between local management agencies and businesses.
Taiwan is the largest foreign investor among 60 countries and territories investing in Binh Duong, according to Nguyen Thanh Truc, director of the provincial Department of Planning and Investment.
They have so far pledged to work on a total of 843 projects, worth more than US$5.5 billion, accounting for 16.2% of the province’s foreign direct investment.
They are mainly active in textiles and garments; footwear; and supporting industries for the automobile, medical, pharmaceutical, cosmetic and food processing sectors.
Khanh Hoa hotel room occupancy falls
The number of tourists visiting Khanh Hoa rose steadily during the year up to July, but many hotel rooms in this central province remained unoccupied. Falling hotel room occupancy rates prompted many hotels to lower room tariffs to attract tourists.
The province saw the highest growth in the number of tourists in April, up by 69,000 arrivals versus last year’s figure to reach over 550,000, while the lowest growth recorded was still over 43,000 arrivals in March, according to data from the provincial Department of Tourism.
Despite such robust growth in arrivals, however, steep declines in hotel room occupancy rates were recorded. In particular, the occupancy rates from April to July this year averaged 55%, lower than those seen in 2018, at over 70%. Similarly, the rates during the first three months of the year remained lower than those seen in the same period last year.
Of these, the occupancy rates at four- to five-star hotels exceeded 60% for months, higher than the rates of one- to two-star hotels at 35%. The low occupancy is attributed to the overheated development of accommodation facilities.
Hotel operators typically break even when the average occupancy rate stays at 65%, said a hotel expert.
Speaking to The Saigon Times, some hotel and travel operators reported that many hotel owners had to lower room tariffs to attract more customers, with discounts of up to 30% for customers from China, a source tourism market of the province.
Local tourists will be offered discounts of 10%-15%. Besides this, tour operators can easily book hotel rooms for their customers, even on holidays.
A manager of a four-star hotel in the province’s Nha Trang City told the paper that its occupancy rate in June had dropped as low as 40% since the hotel was determined to keep its room rates unchanged.
Aside from special offers, hotels in the province are willing to prepare available rooms for local visitors, which is considered the greatest change in the provincial hospitality industry, according to travel firms from HCMC. Earlier, it was difficult for them to book rooms in Nha Trang for their tour groups at reasonable prices, even during the off season, they added.
The province is home to some 770 residences with 42,500 rooms. Also, it has the highest number of luxury resort and hotel rooms in the country, at over 14,000 units, according to the Vietnam National Administration of Tourism.
HCM City to take promotion path to increase exports
The 2019 Export Forum was held in Ho Chi Minh City on August 27 to discuss the strengthening of trade promotion to enhance production and exports by city businesses.
Pham Thiet Hoa, Director of the HCM City Investment and Trade Promotion Centre (ITPC), said the forum discussed new ways of export promotion to align with current global market approaches and diversify promotional activities.
The export structure of Vietnamese goods had seen positive changes in the past few years, with a fall in the export of raw materials and increase in processed goods, enabling the country to participate in the global production and supply chains, he said.
Experts shared their insights into world market trends and issues Vietnamese companies should focus on to access and expand markets including through e-commerce and digital platforms.
To tap into the Southeast Asian market, Hoa said Vietnamese exporters should engage in more trade promotions and market surveys, and strengthen linkages with enterprises in target markets.
Exporters should also study prices, consumer tastes and trends in other markets, and have labels and packaging in English and the local language, Hoa said.
To meet the requirements of the ASEAN market, enterprises should also build brands, use technology in production and improve designs, Hoa said.
In markets such as the US, the EU, Japan, and the Republic of Korea, in addition to general global standards, exporters should also be prepared to face technical barriers that could change unexpectedly, experts said.
Last year, the US was Vietnam’s largest export market with shipments worth 39 billion USD, 12.8 percent up from 2017, followed by the EU with 34.9 billion USD, up 9.9 percent, and China with 32.1 billion USD, up 21.3 percent.
SCG seeks partnership to accelerate circular economy
Siam Cement Group (SCG), a major Thai investor in Vietnam, will continue to seek partnership to accelerate circular economy, calling for joint action from all relevant stakeholders, from the government to private businesses and citizens, to reduce material use and increase recyclability.
The commitment and collaboration between the government, businesses and the people will be the decisive factor for the success of the circular economy, Roongrote Rangsiyopash, president and CEO of SCG, told The Saigon Times at the symposium themed “Circular Economy: Collaboration for action” held at Centara Convention Center in Bangkok on August 26.
Referencing the petrochemical complex that SCG is creating in Vung Tau, Rangsiyopash said that SCG had to make the complex as an example of circular economy principles.
According to the leader of SCG, SCG Vietnam has been tasked with using these principles to construct the complex. SCG Vietnam has also started to engage with local institutions to mobilize public support and participation.
Rangsiyopash noted that Vietnamese youngsters are active and can adapt to the requirements of the circular economy.
This year, SD Symposium celebrates its 10th anniversary of promoting the reuse and recycling of products to cope with material scarcity.
Delivering the welcoming remarks, Rangsiyopash said that the business community should take the lead in changing the “buy-use-dispose” habit to a “make-use-return” cycle.
The opening ceremony also featured a keynote address by Amnia J. Mohammed, United Nations Deputy Secretary-General, who praised the SCG as a highly active performer in the circular economy.
The circular economy is an emerging model, and SCG is a newcomer, Rangsiyopash said.
However, thanks to its earnest approach, investments and heavy financial backing from Thai royalty, SCG is rapidly catching up with its peers, even creating its own economic principles and adapting the existing model to serve its daily business activities.
They have set up connections with 45 partners in the government, private sector and among the public, both in Thailand and abroad.
SCG has had significant achievements in redesigning and innovating products to reduce material use and durability and increase recyclability.
These achievements are showcased at the event, particularly at the product reuse kiosk, which demonstrates how the company turns a profit from using waste to create handicrafts, fuel and road construction materials.
Last year, SCG converted some 313,000 tons of industrial waste per year into renewable raw materials and turned 131,000 tons of industrial waste per year into fuel substitutes.
Speaking at the SD Symposium on forging partnerships for the circular economy, Pham Hoang Hai, Partnership Development Head of Vietnam Business Council for Sustainable Development under the Vietnam Chamber of Commerce and Industry, discussed how quickly the stakeholders have embraced the principles of the circular economy in Vietnam.
As all three divisions of SCG---chemicals, packaging and cement production---are conducting projects in Vietnam, Rangsiyopash hoped that SCG would accelerate the understanding and use of the circular economy among its Vietnamese subsidiaries.
He said SCG Vietnam would seek collaborations from other partners in Vietnam only if these companies were prepared and committed to the process.
Information technology conference to kick off in HCMC
The 2019 Vietnam Information Technology (IT) Outsourcing (VNITO) Conference, which will be launched in Phu Nhuan District on October 23 under the theme “Vietnam: Destination for innovation,” is expected to promote the growth of the information technology outsourcing sector in the country.
At a briefing held in HCMC today, August 27, to introduce VNITO 2019, the VNITO Alliance said it expected Vietnam to become an innovation hub in Southeast Asia. This is also the main theme of VNITO 2019, the alliance representative stated.
As of August 26, as many as 300 exhibitors, including 100 foreign participants from the United States, Germany, Japan, South Korea and Singapore, had registered to join the three-day conference. The number of booths showcasing products and solutions from IT firms has increased significantly, from 21 booths in 2015 to 60 in 2019.
Tran Phuc Hong, a representative of the organizing board of VNITO, remarked that this year’s edition is expected to discuss the growth of the Japanese and South Korean markets. The conference will feature IT experts from the two countries, who will share stories on successful cooperation efforts between Japanese and South Korean firms and local IT enterprises.
Addressing the briefing, Lam Nguyen Hai Long, CEO of Quang Trung Software City Development Company and chairman of VNITO Alliance, pointed out that two of the largest delegations of foreign enterprises expected to participate in VNITO 2019 come from South Korea and Japan.
Nguyen Cong Ai, deputy general director of audit, tax and advisory service provider KPMG Vietnam, noted that domestic firms are enhancing their investment in technology such as by deploying digital transformation and cyber security.
The local market is experiencing a race to find IT employees, Ai said, adding that manpower plays a key role in firms’ success and development, he explained.
Discussing human resources for the IT sector, Nguyen Huu Le, chairman of software outsourcing firm TMA Solutions, stated that the demand for highly skilled employees will surge in the coming months. As such, TMA has developed an innovation park in the coastal city of Quy Nhon in the central province of Binh Dinh. TMA plans to develop hi-tech services in several regions besides Hanoi and HCMC.
Firms should take caution in online export transactions: expert
Vietnamese exporters should take caution while conducting transactions with foreign partners via e-contracts, said Chau Viet Bac, deputy secretary of the Vietnam International Arbitration Center (VIAC).
At the Export Forum 2019 held by the HCMC Investment and Trade Promotion Center on August 27, Bac said the legal value of e-contracts is recognized in most countries in the world, including Vietnam. However, evidence on paper should be kept to prevent risks in case of disputes.
He discussed with representatives of local exporters issues in import-export contracts and solutions to international trade disputes, noting the trends of the conversion from paper-based contracts to e-contracts and online payments amid the digital economy.
Due to the development of information technology, especially the Internet, Vietnamese enterprises have increasingly used e-contracts. According to the e-Commerce and Digital Economy Agency, under the Ministry of Industry and Trade, 28% of Vietnamese enterprises had used e-contracts as of last year.
As a result, trade disputes have been addressed through online negotiations, mediation and arbitration, besides through the courts.
In online transactions, information will be saved automatically, saving time and costs. However, it is hard to verify the authority of employees in charge of conducting the transactions.
Over 126.85 million USD mobilised from G-bond auctions on HNX
The State Treasury mobilised more than 2.95 trillion VND (126.85 million USD) from a G-bond auction on the Hanoi Stock Exchange (HNX) on August 28.
Some 3 trillion VND worth of bonds were offered, including 7-year bonds valued at 500 billion VND, 10-year bonds at 1 trillion VND, 15-year bonds at 1 trillion VND, and 30-year bonds at 500 billion VND.
Bonds with 7-year maturity raised 450 billion VND with an annual interest rate of 3.75 percent, 0.22 percent lower than the previous auction on July 24.
Those with a 10-year term attracted 1 trillion VND with an annual yield rate of 4.18 percent, down 0.02 percent from the auction on August 21.
Meanwhile, 15-year bonds were purchased with a total value of 1 trillion VND, and an interest rate of 4.46 percent, decreasing 0.04 percent from the auction on August 21.
As much as 500 billion VND was collected via 30-year bonds with a yield rate of 5.35 percent, compared to 5.51 percent offered at the August 14 auction.
From the outset of the year, the State Treasury mobilised more than 148 trillion VND via auctions on the HNX.