BUSINESS NEWS 4/7

Clean production gets fruity in export

Vietnamese firms can expand exports and reap “sweet fruits” in picky markets by investing in clean production technology, a leading businessman has said.

General Director of Aeon Topvalu Vietnam Limited Company Yuichiro Shiotani recently called on local firms to do more to meet strict standards in some export markets.

In the coming year, the value of Vietnamese goods sold into modern retail system Aeon Group (Japan) will likely reach 500 million USD and is expected to reach 1 billion USD in the next five years, according to thoibaokinhdoanh.vn.

However, Shiotani cautioned that Vietnamese suppliers have to invest more in equipment.

Shiotani said once Vietnamese suppliers invest in equipment, they will receive more orders.

As a distributor, Aeon understands the risks businesses face, so he has sent advisers to help businesses invest appropriately in order to receive orders.

Aeon hopes to sign up 2,000-3,000 Vietnamese suppliers which can export products to Aeon’s supermarkets in Japan, Shiotani told thoibaokinhdoanh.vn.

It’s important that Vietnamese manufacturers' production processes meet clean standards, which will require investment, according to Shiotani.

Vo Quan Huy, director of Huy Long An – My Binh Co., Ltd., said that to stabilise exports to picky markets, the State needs to build standards for companies in production development to help them meet criteria set by the purchaser or the standards of the importing country.

According to Huy, firms should be consistent and think for the long-term in meeting standards of importing countries to develop sustainably.

For example, pomelo can be exported to the EU, but some firms have had problems with pesticide residue. To deal with this issue, Huy called for the establishment of a clean growing area to attract enterprises to invest in exports.

Meanwhile, exports of lychees into fastidious markets have improved after firms adopted a clean process. This year, the US Department of Agriculture has granted codes to 18 lychee growing areas in seven communes in Luc Ngan district (Bac Giang province) with a total area of 217.89ha.

On exports to Japan, with many years of experience exporting bananas to the country, Huy said this market consumed a lot but his enterprise was stuck with the problem that workers could not afford to pack bananas in line with Japanese standards.

To conquer a difficult market like Japan, many businesses have decided they must persevere with a clean production process.

In May, Vietnamese firm Seagull Agricultural Development Corporation became the first Vietnamese enterprise granted JAS organic certification by Japan’s Ministry of Agriculture - a very strict certification.

To achieve this certification, the company had to spend three years practicing JAS standards with clean agricultural production process and had to avoid the overuse of chemicals in farming.

FTAs generate opportunities, challenges to Vietnam’s agriculture

The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the EU-Vietnam Free Trade Agreement (EVFTA) will create opportunities for Vietnam to boost agricultural exports and improve the capacity of the domestic farming sector, heard a recent conference.

Apart from opportunities, the two deals will create remarkable challenges to the country’s agriculture, said Minister of Industry and Trade Tran Tuan Anh, citing the EVFTA with tax commitments and regulations on product origin as an example.

Echoing Anh’s views, Minister of Agriculture and Rural Development Nguyen Xuan Cuong said Vietnam will have to engage in a competition with other member countries of the two deals like Canada, Australia and New Zealand which also have potential for agricultural development.

One of the biggest problems is the small scale of the agricultural production, he said, explaining that Vietnam has only 8.6 million farming households and 10 million ha of arable land, but has to compete with countries with greater land resources.

Given this, the minister suggested mobilising faming households to participate in cooperatives and join hands with businesses in this sphere.

Besides, products must fulfill standards and requirements set by both domestic and foreign markets, he said, noting that the work requires joint efforts of the Government, State, businesses and farmers.

He also lauded the adaptability of the Vietnamese economy and the domestic agricultural sector in particular, which has been demonstrated through the implementation of 12 free trade agreements.

Other participants at the event said that Vietnam will find it hard to use the non-tariff barrier as a protective measure due to its limited legal capacity and scientific evidence.

Meanwhile, the domestic agricultural sector will face a fiercer competition with foreign products which are expected to flood the Vietnamese market following the reduction of the tax barriers as committed in the agreements, he said.

Besides, regulations on food safety and hygiene, and technical standards in picky markets like Japan and EU countries will also challenge the sector.

The EVFTA and the EU-Vietnam Investment Promotion Agreement (EVIPA) are scheduled to be signed in Hanoi on June 30.

Vietnam has, to date, engaged in a total of 16 FTAs, both bilaterally and multilaterally.

Infrastructure perfection urged to boost investment attractiveness

Vietnam needs to swiftly perfect its infrastructure to meet growing development requirements as well as foreign investors’ demand, especially when it is expected to become the most attractive investment destination in the region, heard a forum in Hanoi on June 26.

At the mid-term Vietnam Business Forum (VBF), Co-Chairwoman of the VBF Consortium Virginia B. Foote said in 2018, 76 percent of foreign direct investment in Vietnam was poured into manufacturing, real estate and retail, which are important growth driving sectors.

According to the Global Infrastructure Outlook, the country will need over 600 billion USD to achieve infrastructure goals by 2040. While the budget is not enough to meet this development demand, destinations for long-term and stable investment worth trillions of USD around the world are still being sought.

If those capital sources are connected with the infrastructure investment demand in Vietnam, the flow of goods and passengers will be facilitated and productivity improved, more jobs created, and budget revenue increased, the report said.

Chairwoman of the American Chamber of Commerce in Vietnam (AmCham)’s Ho Chi Minh City chapter Amanda Rasmussen said mobilising capital for infrastructure needs the participation of private investors. AmCham members hope that the Vietnamese Government will set up an investment mechanism in the public-private partnership (PPP) format in the field of infrastructure.

She also recommended that to ensure sustainability, Vietnam should make sure that seaports and airports are situated in locations convenient for but not too close to residential areas to avoid transport pressure caused by urbanisation.

Chairman of the Japanese Chamber of Commerce and Industry in Vietnam Nobufumi Miura said Vietnam needs to promote investment in infrastructure projects. However, investors are encountering certain PPP-related difficulties and risks.

The Government should clarify risk allocation among it and relevant parties to ensure suitable payback, he said, adding that Japanese businesses believe the promotion of the PPP will help fuel economic development and improve people’s living standards.

Vice Chairman of the European Chamber of Commerce in Vietnam (EuroCham Vietnam) Tomaso Andreatta said the country holds huge potential and a favourable geographical location to make use of investment capital sources and improve the infrastructure system.

He pointed out the inefficient management of expressways which has led to the fact that the use of these facilities haven’t been maximised and traffic congestion not addressed. Therefore, the Government should enhance monitoring to ensure the effective allocation of resources and the safety and sustainability of infrastructure facilities.

The official also highlighted the need to diversify means of transport, noting that inland waterway, railway and air transport should be connected with one another to ease pressure on road transport. The relationship between transport infrastructure and export processing zone planning also needs to be thoroughly considered to maximise their use in the future.

Andreatta also proposed the Government consider the application of new technologies to transport infrastructure and speed up the integration of procedures with the national single window and the ASEAN single window mechanisms to harmonise the infrastructure system since this is also a driving force of the development and investment attraction.

Growth demand fuels solar power boom in Vietnam

Many solar power plants have become operational in the southern region in the first half of 2019, showing part of the solar power development wave to meet the economic growth demand in Vietnam.

In mid-June, TTC Group of Vietnam and Gulf Group of Thailand opened two solar power plants in Thanh Thanh Cong Industrial Park in An Hoa commune of Trang Bang district, the southern province of Tay Ninh.

Gulf Group said the two firms have cooperated with experienced contractors in the field of renewable energy in Vietnam since this is one of the fastest growing economies in Asia. Particularly, many forecasts said energy demand in the country will increase strongly in the time ahead.

Also in June, a joint venture of the Vietnamese group Bamboo Capital and Vietnam-Oman Investment, a joint venture between the State General Reserve Fund of Oman and the State Capital Investment Corporation of Vietnam, inaugurated a solar power plant in Thanh An commune of Thanh Hoa district, southern Long An province.

With 123,000 solar panels, this factory is expected to generate 57 million kWh per year, equivalent to the annual consumption of 22,000 households in Vietnam. It is hoped to help reduce about 16,000 tonnes of CO2 emitted every year.

Some reports indicated that to maintain the current economic expansion in Vietnam, every percent in GDP growth needs a growth rate of 2.2 percent in electricity output. Additionally, to ensure energy security, investing in renewable energy is considered an urgent solution to all countries, including Vietnam. It will also help with the switch to a green economy and the diversification of energy sources.

To catch up with Vietnam’s economic growth, the electricity sector needs to grow by 10 percent annually to produce 500 billion kWh by 2030.

According to the national electricity development plan, the capacity of power generation facilities installed will have to reach 130,000 MW by 2030, compared to 47,000 MW at present.

Therefore, new facilities with a combined capacity of 83,000 MW will need to be built and put into operation from now to 2030. More power transmission and distribution infrastructure is also needed.

Vice Chairwoman of TTC Group Huynh Bich Ngoc said her business has inaugurated seven solar power factories nationwide so far, and it is also planning another plant with a capacity of 30MW in the southern province of Ben Tre.

Deputy Minister of Industry and Trade Hoang Quoc Vuong said the country’s renewable energy development strategy until 2030, with a vision to 2050, was approved in 2015. The Government has also issued many incentives for renewable energy projects, especially solar and wind power ones.

Subsequently, ministries, sectors and localities have been implementing many policies to attract investment to renewable energy. By the end of 2018, solar power projects with a combined capacity of about 10,000 MW had been registered, he noted.

Vietnamese tourism promoted in RoK

A conference to promote Vietnamese tourism was held in Seoul in June 26 as an opening activity for the Vietnam Tourism-Culture Festival in the Republic of Korea (RoK).

Addressing the event, Minister of Culture, Sports and Tourism Nguyen Ngoc Thien said that over the years, Vietnam and the RoK have implemented various exchange and cooperation activities in the fields of culture, sport and tourism, including the Vietnamese Culture Days in the RoK.

Such exchange activities have contributed to deepening the understanding and friendship between the two countries, encouraging more Koreans to travel to Vietnam, he said.

The minister affirmed that the Vietnamese Government always welcomes and creates the best possible conditions for RoK tourists, investors and travel firms.

Korean guests at the conference were introduced to Vietnamese landscapes, resorts, hotels as well as the Vietnamese people and traditional cultural practices.

According to Vietnamese Tourism Ambassador to the RoK Ly Xuong Can (Lee Chang-kun), the Vietnamese tourism sector has grown rapidly, making Vietnam one of the most attractive destinations for Korean tourists.

At the same time, the number of Vietnamese visitors to the RoK has been rising, he noted, forecasting that the tourism partnership between the two countries will be further expanded in the future.

In 2018, Vietnam welcomed nearly 3.5 million RoK tourists, a surge of 44.3 percent year on year.

In the first five months of 2019, Vietnam welcomed nearly 1.8 million visitors from the RoK, up 22.4 percent over the same period last year. The RoK has become the second biggest tourist source market of Vietnam.

Meanwhile, nearly 500 million Vietnamese tourists visited the RoK in 2018, a rise of about 41 percent over 2017.

In recent years, Vietnamese tourism sector has seen the engagement of many RoK firms such as Lotte, Accor and Intercontinental, along with the stronger rise of domestic firms such as Sungroup, Vinpearl, FLC and Vietjet Air.

In 2017 and 2018, Vietnam was listed as the leading tourist destination in Asia by the World Travel Awards.

Business community to help Vietnam realize socio-economic targets

The business community is the main actor that pushes Vietnam to realize the country’s socio-economic development targets, according to Deputy Prime Minister Trinh Dinh Dung.

“Only enterprises have financial resources and capabilities to utilize the human resources and technologies in the most effective way,” Dung said at the mid-term Vietnam Business Forum (VBF) 2019 themed “Roles of business community in rapid and sustainable development” on June 26.

Dung also referred to the unfavorable global business environment over the last few years, leading to the 10-year low of world’s economic growth.

“This has not stopped Vietnam from maintaining positive economic growth, as the country still remains a spotlight in terms of economic development in the region,” Dung added.

Nevertheless, Dung admitted Vietnam’s economy still has to address major challenges for development, including low productivity, limited corporate governance, imperfect legal framework for business and investment, high logistics and administrative costs, among others.

Moreover, the ratio of enterprises to population in Vietnam remains low at 1:140, indicating one enterprise for every 140 citizens.

The rate is significantly lower than the average in ASEAN with one enterprise per 80-100 citizens and developed countries including the US, Japan or EU with one business per 10 – 12 citizens.

According to Dung, Vietnam remains steadfast on maintaining growth policy of rapid and sustainable economic development, preventing the economy from being left behind and narrowing development gap between the country and regional peers.

Dung stressed the government would continue to maintain stable socio-economic conditions, which play a key role in mobilizing resources for development in the context of growing global uncertainties.
Additionally, the government gives priority to restructuring the economy towards greater quality and competitiveness, Dung added.

“A centerpiece of the move is the restructuring of public investment and state-owned enterprises, the finance and banking sector, while facilitating stronger growth of the supporting industries to move higher in the ladder of the global value chain,” he stated.

Vietnam also focuses on developing the infrastructure and considers education key for the country’s sustainable development, Dung asserted.

In parallel with such efforts, it is essential to revise the legal framework towards greater transparency and fairness, laying a strong foundation for capital mobilization from within the economy and abroad.

Dung also noted Vietnam to continue its extensive integration effort in global economy by participating in a number of free trade agreements, including the upcoming EU – Vietnam Free Trade Agreement (EVFTA).

“A multilateral world is a perfect environment for Vietnam’s sustainable development and also serves as a the country’s new driving force in the future,” Dung concluded.

Staying on the topic of sustainable development, Minister of Planning and Investment Nguyen Chi Dung added internal issues of Vietnam’s economy is causing negative impact on the growth quality and also productivity.

Minister Dung urged government agencies to continue reforming administrative procedures and taking advantage of the e-government model.

Chairman of Vietnam Chamber of Commerce and Industry (VCCI) said the government has achieved positive results in improving the business environment, especially in removing obsolete and inefficient business conditions.

However, more attention must be given to relieving the burden of having to acquire various types of licenses and certificates for companies.

Vinamilk’s organic products impress Global Dairy Congress

Vietnamese dairy producer Vinamilk’s organic product have impressed delegates to the 13th Global Dairy Congress which is being held in Lisbon, Portugal, from June 26-27.

The annual event attracted representatives from the world’s top 50 dairy and nutrition companies from Europe, the US and Japan.

Vinamilk is the only Asian representative to be invited to the event to share its success story about leading premium organic trend in Vietnam.

Vinamilk Executive Director Phan Minh Tien said the event afforded the company a chance to introduce the development of the Vietnamese dairy sector to the world.

As Vietnam’s leading nutrition producer and one of the world’s top 50 dairy companies, Vinamilk pioneers by debuting the first powdered milk for children meeting European organic standards in the country.

It also takes the lead in investing in organic ecological system from milch cow farms to factories using modern technologies.

In 2017, Vinamilk inaugurated the first European-standard organic milch cow farm and debuted organic fresh milk in Vietnam.

Last month, it teamed up with Japanese and Lao partners to build Lao Jagro Vinamilk milch cow farm in Laos with 100,000 heads on a site of 20,000ha and a total investment of 500 million USD.

By 2020, the first stage of the project will meet European, US and Japanese organic standards and provide fresh milk materials for Vietnam and Asia.

Research institute-business cooperation key for energy development: forum

Research institute-business cooperation for technology transfer and human resources was a key matter discussed at the 2019 Vietnam Technology-Energy forum, which took place in Ho Chi Minh City on June 26.

According to Huynh Thanh Dat, Director of the Vietnam National University - Ho Chi Minh City (VNUHCM), Vietnam holds great potential for renewable energy growth, with 63 percent of its total areas suitable for developing wind power facilities. However, the advantage is yet to be fully tapped.

A number of university-business cooperation projects have been carried out in the sector, including those between the HCM City University of Technology and Bach Khoa Investment and Development of Solar Power Corporation (SolarBK Group) as well as the VNUHCM and Redsun-ITI Corporation. A project on the localization of wind power machines in Vietnam has also seen the participation of Vietnamese and German universities, research institutes and enterprises.

However, cooperation and investment in clean energy remain limited. As such, the renewable power output accounts for a small proportion of the country’s total.

As of May, Vietnam had 57 operating solar and wind power plants with a total designed capacity of approximately 2,800 MW.

At the forum, participating Vietnamese and foreign experts and businessmen discussed experiences and policies related to sustainable energy development, smart technology in the field, and Vietnam’s wind turbine production technology.

Sang Hoon Lee, director of the Green Energy Strategy Institute under the Republic of Korea (RoK) Energy Agency, praised Vietnam’s potential for clean energy, particularly wind power.

He said the RoK side is willing to share renewable energy experience and technology with Vietnam.

Businesses play key role in socio-economic development: Deputy PM

The Vietnamese Government has consistently prioritised fast and sustainable economic growth, and the business community plays as a key force to realize the country’s development goals, said Deputy Prime Minister Trinh Dinh Dung on June 26.

Attending the Midterm Vietnam Business Forum 2019 held in Hanoi under the theme of “Roles of business community in rapid and sustainable development”, Deputy PM Dung laid stress on Vietnam’s robust economic growth in the past decade amid unfavourable global economy.

In a bid to harmonise economic growth with social stability, the Government has made concerted efforts to ensure the quality of growth, stabilise the macro-economy, develop environmentally friendly industried, and accelerate the production of high-tech products, among others.

Economic restructuring will be given special attention so as to improve the country’s competitive edge, he said, adding that focus will be channeled to the development of the supporting industry to increase Vietnamese firms’ presence in the global value chain, and shake-up in public investment, state-owned enterprises, finance-banking and energy sectors.

At the same time, investment in comprehensive transport, rural and urban infrastructure, as well as in education and training - a decisive factor for Vietnam’s sustainable growth, will be prioritized in the coming time.

Deputy PM Dung said that the Government is completing mechanisms to create a transparent business climate, and accelerating administrative procedure reforms to improve efficiency of investment and production.

Meanwhile, it will continue the external policy of multilateralisation and diversification of international relations, and enhance global integration through engaging in new-generation free trade deals, creating a motive for Vietnam’s growth in line with the global economic situations, he added.

Giving recommendations to better the business environment, Chairman of the Vietnam Chamber of Commerce and Industry Vu Tien Loc said that the Government should cut post-registration procedures for businesses, pen rational policies for micro and small businesses, create favourable conditions to enable firms to access capital, and safeguard the investment environment’s stability.

Vietnam aims for 6.8 percent GDP growth in 2020

Vietnam will strive for a GDP growth of around 6.8 percent in 2020, according to Directive 16/CT-TTg on the building of socio-economic development plans and State budget estimates for 2020.

The directive issued recently by the Prime Minister makes clear that the overall goals of development plans and State budget estimates in 2020 are to continue strengthening the macro-economic foundation, controlling inflation and enhancing the internal strength and independence of the national economy.

The plans should also aim for more effective implementation of strategic breakthroughs and economic restructuring in combination with renewing the growth model, while intensifying institutional reform, creating an open and favourable environment for investment, production and business.

Economic growth should be in tandem with social and cultural development, improvement of people’s material and spiritual life, environmental protection, natural disaster prevention and response to climate change.

The directive also outlines eight directions for socio-economic development next year.

 

Regarding the State budget collection estimates in 2020, the PM requires that collection from taxation and fees should be between 19 – 20 percent of GDP.

Domestic revenues (excluding those from crude oil, land use fees, lottery, sales of State capital in enterprises, dividend and post-tax profit and revenue-expenditure balance of the State Bank of Vietnam) should increase by at least 10-12 percent compared to estimated revenues in 2019.

Meanwhile, collection from import-export should increase by at least 5-7 percent from estimated collection in 2019.

Vietnam, Mozambique seek to enhance trade, investment, tourism ties

Over 100 representatives of Vietnamese and Mozambican businesses gathered at a forum in Maputo on June 26 to seek stronger links in trade, investment and tourism between the two countries.

Vietnamese Ambassador to Mozambique Le Huy Hoang said the Vietnamese Government is committed to continued support of the two countries’ businesses to reinforce partnership and capitalise on their potential and advantages.

Meanwhile, Director of the Hanoi Department of Industry and Trade Le Hong Thang introduced advantages of the Vietnamese capital city, including favourable policies, transport infrastructure and human resources. He also highlighted the municipal authorities’ resolve to assist foreign enterprises to engage in economic, investment and trade cooperation.

Mozambican Deputy Minister of Industry and Trade Julio Joao Pio reviewed the recent strides in bilateral relations, including the fruitful investment of Movitel – a joint venture worth over 600 million USD of the Vietnamese military-run telecom group Viettel in the African nation.

He called on the two countries to bolster economic, trade and investment ties, encouraging Vietnamese firms, including those from Hanoi, to invest in potential fields in his country like agriculture, farm produce processing and mining.

For his part, Director of the Mozambique Chamber of Commerce and Industry Arlindo Duarte said he hopes to continue serving as a bridge helping businesses to boost substantive cooperation for the sake of both countries.

At the forum, Ambassador Hoang and Hanoi companies presented economic, trade, investment and tourism potential of Vietnam in general and the city in particular, along with policies supporting bilateral trade and investment activities.

They also introduced Vietnamese goods that are in demand in Mozambique like agricultural products, handicrafts, apparel, wood products and building materials. Famous cultural and historical sites of Vietnam were also promoted to attract more visitors from Mozambique and neighbouring countries.

Also at the event, Vietnamese and Mozambique businesses engaged in B2B activities to explore partnership opportunities. Many of them expressed their hope that the countries will soon sign a double taxation avoidance agreement and financial-banking deals to help protect legitimate rights of enterprises.

Forum aims to bolster Vietnam’s ties with southern China localities

A forum on promoting investment and trade cooperation between Vietnam and China took place in Guangdong, China on June 25 as part of activities in the framework of the 7th conference reviewing cooperation between Vietnam’s ministries and localities and Guangdong.

Opening the forum, Deputy Foreign Minister Le Hoai Trung noted that Vietnam has an average GDP growth of 6.6 percent a year during the past three years, one of the highest growth rates in the region and the world.

The country earned nearly 500 billion USD from exports in 2018, ranked among the top 30 economies with largest foreign trade revenues in the world, he said, adding that Vietnam is a member of many new-general free trade agreements, with the latest being the EU-Vietnam FTA to be signed at the end of this month.

The Deputy FM highlighted encouraging progress in the economic-trade partnership between Vietnam and China, with Vietnam being the largest trade partner of China in ASEAN and the 8th largest in the world for many consecutive years.

He said China’s Greater Bay Area plan released recently creates good opportunities to promote collaboration between Vietnam and the potential southern region of China.

Vice Governor of Guangdong province Ouyang Weimin also stressed the big size of Guangdong’s economy, which was worth nearly 1,500 billion USD in 2018. The province also accounts for nearly one quarter of China’s total foreign trade with 1,100 billion USD, ranking first among Chinese localities throughout the past 33 years.

The Vice Governor proposed four points to push forward cooperation between Guangdong and Vietnamese localities, including sharing development opportunities in the Greater Bay Area of Guangdong-Hong Kong-Macau; bolstering bilateral investment and trade ties; promoting exchanges in finance; and deepening tourism and education partnerships.

The forum attracted the participation of delegates from ministries, agencies and localities of Vietnam and Guangdong along with more than 300 guests from businesses of both sides.

In the framework of the forum, Deputy FM Trung, Vice Governor Ouyang Weimin and other delegates visited stalls introducing Vietnam’s dairy products, fruits and confectionery.

The 7th conference reviewing cooperation between Vietnam’s ministries and localities and Guangdong was held on June 24.-

Vietnam, South Africa look to expand trade linkage

Representatives from the Trade Promotion Agency under the Ministry of Industry and Trade of Vietnam and South Africa’s Department of Trade and Industry met on June 25 to discuss ways to boost trade cooperation between the two countries.

The event was part of the Vietnamese delegation’s trip to attend the South African International Trade Exhibition 2019 (SAITEX) in Johannesburg.

Bui Thi Thanh An - deputy head of the Trade Promotion Agency, appreciated the efforts made by the two sides in the last decade to lift two-way trade to more than 1 billion USD in 2018 from 658 million USD in 2010.

Although Vietnam-South Africa trade turnover has increased for years, there is still room to expand two-way trade, especially in mining, production and processing of food and seafood, An said.

Regarding trade policy, she suggested both nations consider building a free trade agreement (FTA) to facilitate goods and service exchange and investment cooperation.

Vietnam has signed more than 10 FTAs with partners and most of them are operating effectively, contributing to national GDP, she stressed.

For his part, Chief Director of Bilateral Relations at the Department of Trade and Industry of South Africa Victor Mashabela applauded Vietnam’s proposal for an FTA, saying it will be a turning point in trade ties and bilateral cooperation.

He said a delegation of Department of Trade and Industry of South Africa will visit Vietnam in the final quarter of 2019 to the country’s products and to learn about consumer trends in Vietnam.

Previously, a workshop to connect Vietnamese and South African enterprises was held on June 24 on the sidelines of SAITEX 2019, with the participation of representatives from 22 Vietnamese firms and more than 100 local businesses.

Vietnamese localities seek cooperation opportunities in UK

British businesspeople have said Vietnam is an attractive investment destination, as well as being a top tourist spot.

Business leaders from the north of the UK were speaking at the “Meet Vietnam” conference in the city of Manchester on June 25.

The event aimed to promote tourism and economic potential of Vietnamese northern provinces of Yen Bai and Lang Son and Central Highland province of Dak Lak.

The UK businesses at the workshop have strengths in education, innovation and high technology.

Representatives from the Vietnamese provinces introduced local potential and key projects that they want investment for in eco-tourism, smart urban infrastructure, clean agriculture for export, and renewable energy.

Christopher Jeffery, Chairman of the British Business Group Vietnam, said the more than 40-year diplomatic ties and over 10-year strategic partnership between Vietnam and the UK have created a firm foundation for the two countries’ cooperation.

This is the right time to deepen bilateral cooperation with the creativity of businesses, he said.

He cited clean agricultural production for export as an example, saying that it is a field in which the UK and particularly Manchester could work with Vietnam.

UK businesses also hailed the proactive efforts and creativity of Vietnamese localities in promoting their history, culture and investment potential.

Earlier, representatives from Vietnamese localities visited Lord Mayor of Manchester Abid Latif Chohan, during which they voiced their hope to bolster cooperation with the British city.

US – important market of Vietnam’s wood processing industry

The United States (US) is a leading important market of the Vietnamese wood processing industry, Deputy Minister of Agriculture and Rural Development Ha Cong Tuan affirmed at the Southeast Asia Convention held by the American Hardwood Export Council (AHEC) in Hanoi on June 25.

Last year, the country’s exports of wood and forest products reached 9.4 billion USD, about 42 percent of which came from the US. In the first five months of this year, the US remained the most important market accounting for 45 percent of Vietnam’s total export turnover of wood and wood products, up 34 percent year-on-year, he stated.

Tuan said Vietnam also imported large quantities of timber and wood products from the US. It is currently the top destination for US hardwood in Southeast Asia.

During January-May, the country imported 138 million USD of timber and forest products from the US, an increase of 24.9 percent compared to the same period in 2018.

The deputy minister affirmed that Vietnam has been moving towards building a sustainable wood processing industry that uses legal materials in accordance with international and Vietnamese law as well as regulations of major export markets like the US, the EU and Japan.

According to Nguyen Ton Quyen, Deputy Chairman of the Vietnam Timber and Forest Product Association, the US has one of the largest forest areas in the world, with output of more than 300 million cu.m per year. US wood is guaranteed to be of traceable, legal origins and good quality, and also has competitive prices.

“With these advantages and over 20 commercial timber species, American wood is always the first choice for Vietnamese importers,” Quyen said, adding that Vietnam has signed many free trade agreements, in which it commits to processing only legal timber.

Robert Hanson, Head of the Foreign Agricultural Service of the US Embassy in Vietnam, said Vietnam has accounted for 77 percent of the US’s wood exports to Southeast Asia.

Hanson stated the Forest Law Enforcement Governance and Trade Voluntary Partnership Agreement (FLEGT-VPA) between Vietnam and the European Union has taken effect to ensure the legality and sustainability of Vietnamese wood products. Under the agreement, Vietnam will give priority to importing wood materials from sustainable and legal sources.

Quyen said that Vietnam’s forest product processing industry has rapidly and stably developed in recent years, not only meeting domestic demand for wood products but also moving towards sustainable exports.

There are now 5,000 enterprises involved in the production and processing of wood products (excluding households and small businesses), about 1,800 more than there were five years ago.

Vietnam has halted the exploitation of natural forests for three years and has been pushing forestation. The 3.5 million hectares planted for future exploitation will provide about 35 to 40 million cu.m of timber in the next five to 10 years.

The Vietnamese Government set a target for the forest products sector to reach 11 billion USD in exports this year. To help, the Government has committed to creating good conditions for businesses, including domestic and foreign invested enterprises.

At the conference, the organisers explained the classification system for US wood to designers, processors and importers. The conference also served as a chance for Vietnamese and US businesses to explore future cooperation opportunities.

Mid-term VBF to feature businesses’ role in rapid, sustainable development

The mid-term Vietnam Business Forum (VBF) 2019 will highlight the role of the business community in rapid and sustainable development, heard a press conference in Hanoi on June 25.

Nearly 600 delegates from government agencies, international organsiations, sponsors, and business associations are expected to partake in the event.

VBF is a dialogue mechanism between the Vietnamese government and enterprises at home and abroad, aiming to promote the development of private businesses, improve the investment environment, and contribute to national sustainable economic growth.

Working groups in investment-trade, tax-customs, infrastructure, agriculture, electricity-energy, capital market, education-training, human resources, and tourism will report at the forum.

Participants will talk about relaxing regulations to boost rapid development in association with sustainability; developing global green supply chain; reforming customs procedures to compete with neighbouring countries; addressing regulations that hinder the expansion of investment; and supporting businesses to look towards sustainable economy and innovation.

They will also mention criteria for rapid and sustainable infrastructure development including energy, public-private partnership (PPP), waste treatment, and public transport, and ways for businesses to access Vietnamese capital market in a sustainable manner, as well as development of e-government and digital economy.

Chairman of the Vietnam Chamber of Commerce and Industry (VCCI) Vu Tien Loc told the press that the theme of the forum is suitable with the current requirements of the Vietnamese economies, including reforming growth models and improving investment quality.

He said after the previous editions, more than 60 percent of the proposals made by VCCI and businesses have been addressed by the Government, ministries and departments.

However, business post-registration, reform and settlement of administrative procedures are still one of the concerns that the business community wants the Government, ministries and departments to pay more attention to addressing, he said.

Research from international organisations indicated that Vietnam ranks last in terms of business administration in the ASEAN-6 leading economies, he said.

Therefore, improving the business environment and administration is one of the leading tasks of the Government, ministries and departments, he stressed.

Virginia Foote, who co-chairs the forum, agreed that increasing competitiveness is the key for businesses to gain success.

PM asks northern region to optimise advantages for stronger development

The northern key economic region has advantages over other regions in the country to develop, especially in terms of infrastructure and human resources, Prime Minister Nguyen Xuan Phuc said at a conference last week.

The Government leader highlighted the region’s strategic importance in terms of politics, society-economy, and defence-security, adding that it is the second biggest economic region nationwide and the only region where all localities contribute to the central budget.

The region has nearly 80 percent of communes recognised as new rural areas and the lowest rate of poor households – 2 percent, Phuc said.

He asked regional localities to reform policies in investment, finance, land, human resources, as well as pay attention to institutional reform and improve regional coordination mechanism.

The PM pointed to shortcomings in the region such as unsustainable growth of the service sector, which is the region’s strong point but its proportion in the economic structure is declining; small-scale agricultural production with out-of-date cultivation techniques and processing technology; weak connection in production and business; and environmental pollution in urban and rural areas, river basins, trade villages, and industrial clusters.

Most of foreign direct investment (FDI) projects focus on sectors and industries subject to investment incentives and using low-cost labour. Industrial projects are mainly concentrated in Hanoi, Hai Phong and Bac Ninh such as Samsung, LG, Microsoft and Canon, and just stop at processing and assembling with low added value, the PM noted.

The region should maintain its role as the country’s centre of politics, economy, culture and science-technology, and strive to become one of the nation’s two biggest economic hubs besides the southern key economic region, he said.

The region must take the lead in science-technology and innovation as well as economic restructuring, the PM requested.

He also urged the region to push ahead with building rural areas and reforming administrative procedures, improving business environment, preventing corruption and wastefulness, and ensuring social safety for people.

Regional linkage was a focal point at the conference, with leaders of localities proposing several measures to promote regional connectivity.

Chairman of the Hanoi municipal People’s Committee Nguyen Duc Chung submitted six key measures, emphasising on the development of transport network, industrial parks, clean water supply, waste treatment, housing and environmental protection.

Chairman of the Hung Yen provincial People’s Committee Nguyen Van Phong proposed the Government support Hanoi and Hung Yen to implement some transport projects, including the connection of expressways of Hanoi – Hai Phong and Cau Gie – Ninh Binh.

Leaders from Quang Ninh province suggested speeding up the construction of Hanoi-Cai Lan railway and building a high-speed rail route linking Hanoi, Hai Phong and Quang Ninh.

The northern key economic region, comprising Hanoi, Hai Phong, Bac Ninh, Quang Ninh, Hai Duong, Hung Yen and Vinh Phuc, covers nearly 16,000 square kilometers, making up 4.7 percent of the country’s total area. It has a population of over 16 million, accounting for 17 percent of the nation’s total population.

The region boasts a modern and synchronous transport infrastructure network linking regional localities such as the Hanoi – Hai Phong, Hanoi – Cau Gie – Ninh Binh, Hanoi – Thai Nguyen, Hanoi – Lao Cai, and Ha Long – Hai Phong highways, along with domestic and international airports such as Noi Bai, Cat Bi and Van Don, and important seaports like Lach Huyen and Cai Lan.

According to Minister of Planning and Investment Nguyen Chi Dung, the region’s average gross regional development product (GRDP) growth exceeded 9 percent in 2016-2018.

Last year, its total GRDP made up about 31.73 percent of the country’s GRDP, ranking second after the southern key economic region. The region contributed over 31 percent of the State budget’s revenues and over 30 percent of national exports.

The total development investment in the region reached nearly 1.6 quadrillion VND (70 billion USD), making up 29.76 percent of the country’s total investment.

Hoa Hoi Solar Power Plant inaugurated in Phu Yen

The Hoa Hoi Solar Power Plant was inaugurated on June 25 in Hoa Hoi commune, Phu Hoa district, south central Phu Yen province.

Construction of the 265-ha plant, a joint venture between the Truong Thanh Vietnam Group JSC and Thailand’s B.Grimm Power Pcl., began in November 2018.

The plant has a capacity of 257 MWP, with total investment of over 4.9 trillion VND (210.7 million USD) funded by the Phu Yen TTP JSC.

This is the biggest renewable energy project in the central region, said Dang Trung Kien, Chairman of the Phu Yen TTP JSC, noting that the plant is expected to contribute to spurring socio-economic development, ensuring national energy security and generating jobs for local labourers.

Tran Huu The, Vice Chairman of the provincial People’s Committee, urged the investor to run the project effectively, abide by environmental regulations, pay attention to social welfare and disseminate information about the benefits created by the project.

The Electricity Power Trading Company under the Vietnam Electricity (EVN) group has recognised the plant’s commercial electricity generation since June 10.

Prime Minister Nguyen Xuan Phuc has also designated the plant as a key project in Phu Yen’s socio-economic development master plan until 2020.

Conference looks for ways to boost exports to Singapore

Valuable information to enhance exports to Singapore was shared among experts and businesses at a seminar held by the Ho Chi Minh City Investment and Trade Promotion Centre (ITPC) in the southern hub on June 25.

ITPC Director Pham Thiet Hoa said that besides a potential market for Vietnamese farm produce and processed food, Singapore is an international service hub, and a gateway for made-in-Vietnam products to be known among world’s leading retail giants, hotels and restaurants as well as foreign importers.

Vietnam is currently among the top 15 trade partners of the neighbouring country, with a total export revenue to the market reaching 3.46 billion USD in 2018.

As many Singaporean businesses are seeking to purchase food, garment and textiles and wood furniture for domestic distribution and re-export to other markets, Vietnamese firms boast huge opportunities to develop its export markets in the coming time, he stressed.

Meanwhile, Leon Cai, who is in charge of commercial affairs at the Singaporean General Consulate in Ho Chi Minh City, said Vietnamese businesses can enhance strategic cooperation with Singaporean partners to nudge their products closer to the world, explaining that Singapore is one of the largest consumption markets across the five continents.

Participants also pointed out food safety and hygiene as a major barrier for Vietnamese firms while selling products to the Singaporean market. Many potential goods failed to enter the market as they are not qualified in terms of packaging and instruction for use.

Besides giving out detailed updates of Singapore’s policies and market, participants also shared experience in promoting the efficiency of value chain to reduce logistic costs.

Support packages for exporters were tabled at the event as well.

Stronger int’l cooperation needed to enhance auditing efficiency

The State Audit Office of Vietnam (SAV) has actively applied international knowledge and experience to better ability of auditors and improve efficiency of its operation in new auditing fields, said Auditor General Ho Duc Phoc.

Speaking at a roundtable conference with development partners jointly held by the SAV and the World Bank (WB) in Vietnam in Hanoi on June 25, Phoc highlighted the role played by the SAV in enhancing the accountability and transparency of the Government in managing public finance and fighting corruption.

According to the Auditor General, the SAV has received strong support, great resources and technical assistance from development partners through technical assistance projects and ODA capital auditing programmes in Vietnam. Its development partners include the WB, the European Union (EU), the Asian Development Bank (ADB), the Canadian Audit and Accountability Foundation (CAAF).

The SAV is focusing resources to complete the goals of the SAV development strategy until 2020 and orientations for the sector in the time to come, he said.

Phoc affirmed the SAV’s commitment and top priority for the above-mentioned activities to develop it into a modern and professional State audit agency.

The SAV appreciated experience from audit agencies in developed countries as well as recent support provided by international organisations, he stressed.

Fily Sissoko, Manager, Governance Global Practice for the East Asia Region at the WB, said the conference offers a good chance for the SAV and its partners to discuss and seek measures to enhance cooperation in a more practical and effective manner in the future.

The WB has two important priorities related to breakthrough technology and environmental auditing, which are in line with Vietnam’s national partnership strategy.

Tran Kim Loc, Director of the SAV’s Department of International Cooperation, said the sector will give priority to establishing new auditing fields which will focus on land, natural resources, minerals and environment-related auditing.

It will also pay due attention to promoting the application of high-technology and information technology in managing and supporting auditing activities.

 
 
 
 
 
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