Vietnam has high demand for automotive robotics solutions
The robotics market has grown strongly in recent years due to enterprises’ growing demand for automotive solutions to optimise output and save both labour and operational costs.
Speaking in a recent interview with the local media in HCM City, Huynh Phong Phu, local business manager, robotics and discrete automation, ABB Vietnam, said in 2017 Vietnam became the seventh largest robot market in the world with robot sales jumping by more than 8,000 units.
The driver of the growth was the influx of foreign investment, especially by Korean enterprises, in the electronics industry.
Robots were also used by companies in the fields of automobiles, food, beverages, consumer goods, and metal manufacturing, he said.
The market has around six robot suppliers, and all are foreign.
Phu said ABB sold nearly 5,000 robots in 2017. It achieved double digit growth last year and targets over 20 percent growth this year.
According to the latest report from Global Market Insights, Inc., the global smart factory market is anticipated to rise from 75 billion USD in 2018 to over 155 billion USD by 2025.
Also speaking at the event, Vu Trong Tai, general manager of Reed Tradex Vietnam, said: “The factories that are digitally advanced and connected facilities will sharpen the manufacturing performance in a host of operations.”
Phu said the auxiliary manufacturing industry in Vietnam was growing faster than ever with the convergence of many factors, including the entry of large global manufacturers such as Samsung, LG, Toyota, Honda, Canon, and Brother into Vietnam, whose production facilities are at the heart of the global supply chain.
At METALEX Vietnam 2019, to be held from October 10 to 12 at HCM City’s Saigon Exhibition and Convention Centre, the ABB would show a fully automated production demo of robots controlled by ABB AbilityTM Connected Services, a sophisticated suite of digital services, to enable visitors to experience the future factory, he said.
Tai said METALEX, an international exhibition of machine tools and metalworking solutions, would feature 600 brands from 45 countries and territories, 30 percent more than last year.
This year WELDING Vietnam 2019, the only international exhibition of welding and cutting materials, equipment, and technologies in Vietnam, would be co-located with METALEX Vietnam, he added.
Farmers earn higher incomes from coldwater fish
Farmers and companies in the Central Highlands province of Lam Dong are earning higher incomes from coldwater fish farming by using advanced techniques and taking advantage of favourable weather conditions.
The province has 380ha of coldwater fish farming, up 18ha against 2017, according to the province’s Coldwater Fish Farming Association.
Nguyen Dinh An, association chairman, said that a better fish-fry population, new farming techniques, and improved consumption and production had all contributed to higher incomes.
A total of 19 companies are participating in farming coldwater fish with investment capital of 896 billion VND (38.5 million USD) in the province, according to the association.
In Đam Rong District, five companies and four households, for instance, are farming sturgeon on a combined area of 3ha with a total annual output of 10 tonnes a year.
Each household breeds between 1,000 and 5,000 sturgeons for meat. The farmed sturgeons are mostly Siberian, Russian and hybrid sturgeon species.
To ensure stable water temperatures and enough oxygen, cold water taken from springs is used in farmers' tanks.
Huynh Ngoc Thu, who farms sturgeon in the district, has 22 tanks that produce sturgeon fry and sturgeon for meat.
Sturgeon farmed for meat can reach a weight of 1.8-2.5 kilogrammes a fish after a 12–18 month breeding period, he said.
With a yield of 10-15 kilogrammes per cubic metre a crop, Thu earns a profit of 1.2 – 2 million VND.
Traders pay 170,000-180,000 VND for a kilogramme of the fish.
Water temperature and quality are especially critical in sturgeon farming, according to the district’s Agriculture and Rural Development Bureau.
The district, which has favourable cool weather to raise sturgeon, has helped households and companies invest in sturgeon raising.
The province expects to produce about 1,250 tonnes of coldwater fish farmed in cages, ponds and tanks this year, according to the association.
It also expects to produce about 1,500 kilogrammes of coldwater fish eggs and 1.5 million coldwater fish fry this year.
By 2022, it targets producing 2,000 tonnes of coldwater fish a year.
The association will work with agencies to attract investment in coldwater fish farming and improve the quality of fish species.
Coldwater fish farming must also be environmentally friendly, the association said.
Bac Giang works to lure foreign direct investment
Removing bottlenecks of businesses will be prioritised in the northern province of Bac Giang to lure more foreign direct investments (FDI) in the coming time.
According to Director of the provincial Department of Planning and Investment Trinh Huu Thang, regular dialogues with local firms will be enhanced through the “business coffee” programme so as to handle complaints of the enterprises in a timely manner.
At a recent programme, Chairman of the provincial People’s Committee Nguyen Van Linh affirmed the local authorities always create favourable conditions for investors operating their business in the province.
Competent authorities are asked to study capital demand of the enterprises, and accelerate the reform of lending process, while helping them fully take advantage of local preferential policies.
In addition, training courses will be organised to raise the business community’s awareness of legal regulations, and to support them with market development.
Bac Giang province is now home to nearly 9,000 businesses, including 400 FDI firms. Domestic firms have registered a total capital of 61.9 trillion VND (2.67 billion USD) while that of FDI firms is over 3.1 billion USD.
Exporting firms should focus on intellectual property
In order to take advantage of the Europe-Vietnam Free Trade Agreement (EVFTA), Vietnamese enterprises should pay more attention to intellectual property rights.
The statement was made by Nguyen Hoai Nam, chairman of the Vietnamese Entrepreneurs Association in France at a conference held in Ho Chi Minh City on July 26.
Nam said, with the current scale of Vietnamese enterprises, it would require great effort to take advantage of the EVFTA.
In addition to ensuring general requirements of importing countries on food safety, rules of origin and labour protection are met, enterprises should focus on intellectual property in the commitment of agreements. These are commitments on copyright, invention and geographical indication with a higher level of protection than the World Trade Organisation (WTO).
Sharing the story of Phu Quoc fish sauce – a traditional product of Phu Quoc island which is now being sold in the EU or the US with other countries’ origin, Nam reminded enterprises that when building a product and brand development strategy, the first thing to think about should be intellectual property.
"If businesses are ignorant about intellectual property issues, they will be unable to bring products into fastidious markets," he added.
Another issue highlighted by Nam was that businesses should limit the production and use of products that directly or indirectly affect the environment, such as products with plastic packaging and canned goods, because customers in the EU are particularly concerned about the problem. They are willing to boycott products that may harm the environment or are less environmentally-friendly.
Speaking at the conference, Tran Xuan Trang, head of the ITPC training department, suggested agricultural enterprises that want to bring products into the EU should manufacture processed products because Vietnam does not have a geographical advantage in transporting fresh produce to this market compared to other countries, especially countries in the North African region. Meanwhile, the production of processed agricultural products is being encouraged by the Government to prioritise investment.
According to Trang, businesses need to research and understand current tastes as well as consumption trends of people in European countries to penetrate the market, especially with some countries placing restrictions on the use of sugar in processed agricultural products.
At the event, experts also discussed solutions to create products and services that meet the quality standards of the EU market, especially on food safety, packaging, brand, marketing approach and origin; as well as how to create appropriate business strategies and resources to accurately define the development roadmap of each product and service in the EU market.
Cross-border trade deal bolsters Vietnam-Laos economic links
Trade and investment links between Vietnam and Laos have been enhanced over the last three years thanks to the bilateral cross-border trade agreement, heard a meeting in the central province of Quang Tri on July 26.
The event, held by the Ministry of Industry and Trade, aimed to review three years of the implementation of the deal, inked between the Vietnamese and Lao governments in 2015.
According to the Ministry of Planning and Investment (MPI) of Vietnam, Vietnamese investors have poured 5.1 billion USD into 292 projects in Laos, including 110 worth 2.7 billion USD in the 10 Lao provinces bordering Vietnam.
Those projects have greatly contributed to local growth and generated socio-economic benefits, thereby assisting the Lao Government’s efforts to ensure social security and reduce poverty.
Meanwhile, trade between the two countries rose by about 13 percent annually between 2015 and 2018 to over 1.03 billion USD in 2018, up 11.9 percent year on year. The figure is estimated at 594 million USD in the first half of 2019, up 14 percent, data of the General Department of Vietnam Customs show.
Thirty-six markets have been built along the shared border, which currently houses eight international border gates, seven main border gates, 18 auxiliary ones, and eight border gate economic zones.
These ports of entry and economic zones have been developing stably, thus creating a driving force for economic activities, including trade, services and investment, and improving the living standards of both countries’ border residents, the MPI noted.
At the meeting, representatives of border provinces and businesses also pointed out several problems in the agreement implementation, and proposed solutions.
Vietnam and Laos share a border of 2,337km that runs across 10 Vietnamese provinces and 10 Lao provinces.
FDI in Dong Nai tops 1.14 bln USD in seven months
Foreign direct investment (FDI) in the southern province of Dong Nai topped 1.14 billion USD in seven months of this year, or 114 percent of the 2019 target.
Up to 55 foreign-invested projects were licensed with a total registered capital of over 537 million USD while 64 others registered additional capital of upwards 604 million USD, according to the provincial Department of Planning and Investment.
Newly-licensed projects focus on high-tech and support industry that suit the province’s investment attraction policy.
The province is now home to 1,940 foreign-invested projects worth 34.92 billion USD, mostly by those from 45 countries and territories, including the Republic of Korea, Taiwan (China) and Japan as the top investors.
Lobster prices drop following tightened Chinese border trade
Lobster prices in the southern central province of Khanh Hoa have sharply declined following China’s move to tighten border trade.
Nguyen Ngoc Son, vice chairman of Cam Ranh City People’s Committee, said that prices of painted spiny lobsters are now at just VND580,000 per kilo (USD25,217), down 60%-70% on-year. First-grade ornate rock lobster is presently sold at just VND1.1 million, down half against the same time of last year.
According to Nguyen Thi Chau Pha, chairwoman of farmers association in Cam Linh Ward, lobster breeders are struggling with the drastic price fall, while feed prices are on the rise. Many of the households are suffering losses, ranging from VND20 million to billions of VND.
Nguyen Chi Lem’s family has to spend up to VND5-6 million on feed for 50 cages of lobster per day. Now, he accepts the lobster sale at low prices to cut down the loss which is around VND1 billion.
Son said that lobsters are mostly exported to China via border trade, but recently, goods have to be exported into China officially, not through border trade. This requires the products to have their certificates of origin.
Vo Khac En, deputy head of Khanh Hoa Province’s Fisheries Department, said the agency warned local farmers of China’s tighter border trade policy, urging them to register their product origin certificates. However, many ignored this.
The government’s newly-issued Decree 26 also stipulates the registration of fishery breeding lists which need to be approved by local authorities.
Khanh Hoa is the country’s lobster breeding hub with a total 49,000 cages.
Earlier, the central province of Quang Nam also faced a stockpile of purple back squid which failed to be exported to China due to a lack of origin certificates.
500 Startups Vietnam to invest in 100 businesses by 2020
500 Startups Vietnam, a member of the US venture capital firm 500 Startups, targets investing in up to 100 Vietnam-connected startups by 2020 under its Saola Accelerator programme.
The programme will invest US$100,000 in each company and help them build companies at scale.
The criteria for "Vietnam-connected" startups includes serving the Vietnam market, having a Vietnamese co-founder, and/or having a meaningful portion of the team in Vietnam.
500 Startups Vietnam will also offer training sessions, workshops and hands-on mentoring sessions for startup staff.
The firm has partnered with member-only space Kafnu Hồ Chí Minh City, which is a venue sponsor for the Saola Accelerator Programme, to support entrepreneurship in Vietnam.
Eddie Thái, general partner of 500 Startups Vietnam, said: “Beyond sharing growth know-how, Saola Accelerator aims to create a safe space for founders to ask questions and get support from experts who understand the struggle they are going through.”
The two partners hosted their first co-event “Secrets to a Great Growth Funnel” on July 24, attracting more than 100 technology entrepreneurs and business founders.
Saalim Chowdhury, partner at 500 Startups and director of the Saola Accelerator Programme, spoke about the core drivers that deliver growth to a startup and debunked the notion of growth hacking.
Chowdhury, who has worked with over 250 startups from 25 countries over the past four years, emphasised that growth is not a collection of tactics or shortcuts but a mindset and a process based on constant experimentation.
Chris Edwards, general manager of Kafnu Hồ Chí Minh City and Kafnu Hong Kong said: “We feel privileged to be part of the success story of Việt Nam’s budding entrepreneurs, especially at this crucial and exciting stage of their development, and look forward to growing with them.”
Under the partnership, 500 Startups Vietnam and Kafnu Hồ Chí Minh City will deliver more activities for the creator community to further extend outreach to entrepreneurs.
Vietnam ranks second in ASEAN in manufacturing PMI
Free trade, investment deals to boost Vietnam-Germany trade ties
Vietnam-Germany trade relations will thrive on the back of the freshly inked free trade and investment deals, including the EU-Vietnam Free Trade Agreement (EVFTA) and the EU-Vietnam Investment Protection Agreement (EVIPA), according to insiders.
Nguyen Son Tra, deputy head of the WTO and Trade Negotiation Division under the Ministry of Industry and Trade’s Multilateral Trade Policy Department, said the EVFTA will bring distinct advantages to Vietnamese goods as right after the deal takes effect, 85.6 percent of the tax lines imposed on Vietnamese goods, or 70.3 percent of the country’s exports to the EU will be reduced in the first year.
Meanwhile, the lifted tariffs will be 99.2 percent, or 99.7 percent of the country’s total export turnover to the bloc, in the next seven years, she said.
Particularly, Germany, together with the UK and the Netherlands, has been Vietnam’s leading importer in the EU since 2017. According to statistics from the General Department of Vietnam Customs, two-way trade reached 9.5 billion USD in 2017, with Vietnam shipping some 6.3 billion USD worth of commodities to Germany. Exports to the European country continued to increase to 6.68 billion USD the following year.
In the first half of 2019, Vietnam earned over 3.3 billion USD from selling products in the German market. Key earners comprised footwear, garment and textiles, coffee, seafood, cashew nuts and pepper, among others.
There is huge room for Vietnamese commodities to enter Germany, where consumers have increasing demands for imports. Last year, Germany became the world’s second largest purchaser of furniture with import revenue making up 8.1 percent of the world’s total amount.
Although local furniture firms have tried to penetrate the German market, their market share remains modest. In the first quarter of 2019, Vietnam’s furniture exports to the country only stood at 80.8 million USD, much lower than the market’s demand.
Vietnam’s Trade Office in Germany said the European country is the world’s second biggest importer of pepper, accounting for 10.1 percent of the total import revenue in 2017.
As the second largest supplier of pepper for Germany, just behind Brazil, Vietnam ships average 5,000 tonnes of pepper to the market each year. In 2018, Vietnam pocketed 35.11 million USD from exporting 8,510 tonnes of pepper to Germany, up 5.61 percent in volume but down 34.45 percent in value due to low prices.
Meanwhile, Marko Walde, Chief Representative of the German Chamber of Industry and Commerce in Vietnam, said the EVFTA and EVIPA will open export opportunities and boost investment activities for enterprises of both nations.
There are some 300 German firms operating their business in Vietnam, 55 percent of which have plans to expand investment in the Southeast Asian nation.
Unlike 20 years ago when German firms invested heavily in China, they are now seeking to move their production bases to another country, and Vietnam and Thailand are considered as the most promising destinations, he said.
Walde suggested the Vietnamese Government complete legal frameworks soon so as to build confidence among foreign investors.
Agro-forestry-fishery exports generate 23.03 billion USD in seven months
The agro-forestry-fishery sector raked in 3.55 billion USD from exports in July, raising the total value in the first seven months of this year to 23.03 billion USD, up 2 percent year on year, the Ministry of Agriculture and Rural Development has reported.
Major farm produce shipped overseas brought home 10.84 billion USD, with five “billion dollar” good categories being coffee (1.8 billion USD), rubber (1.1 billion USD), rice (1.73 billion USD), cashew (nearly 1.8 billion USD), and vegetables and fruits (2.3 billion USD).
The ministry said export revenue of agricultural products fell 8.2 percent year-on-year, and this was due to a drop in several products like cashew (20.6 percent), pepper (25.2 percent), coffee (12 percent), and rice (16 percent).
The export prices of two main seafood exports, tra fish and shrimp, dropped 3.2 percent and 10.4 percent to 1.16 billion USD and 1.73 billion USD, respectively, causing seafood export revenue dwindle 1 percent to 4.68 billion USD.
During January-July, shipments of main forestry products earned the country nearly 6.01 billion USD, up 17.3 percent year on year, of which wood and wooden products contributed over 5.6 billion USD, up 16.1 percent, and bamboo and rattan products 264 million USD, soaring 46.6 percent.
According to the ministry, Vietnam spent 18 billion USD on foreign agro-forestry-fishery goods and agricultural materials.
As global economic growth is projected to fall while agricultural development will bounce back in many countries, it will be hard for Vietnam’s agricultural exports in the coming time, the ministry said.
Fierce competition will pull prices of exports down. Besides, large importers of Vietnam like the US, the EU, China, Japan and the Republic of Korea have imposed strict standards on quality management, food safety and hygiene, and origin traceability on agricultural imports.
The ministry will work with businesses and associations to keep a close watch on the development of the markets, as well as enhance inspection on smuggling in the domestic market.
Besides coordinating with competent ministries and sectors to stabilise traditional markets and expand potential ones, helping reduce dependence on single country, the ministry will give production guidance to localities to ensure that their products meet importers’ requirements on origin traceability and geographical indication.
Furthermore, due attention will be given to developing brands for agricultural products, particularly those exported to the Chinese market, while relevant authorities will set up coordination mechanism with the Chinese General Administration of Customs so as to remove bottlenecks in the trading of agricultural products between the two countries.
Germany assists Vietnamese households in developing solar power
Households in Vietnam which install rooftop solar power systems by 2021 will receive a maximum of 6 million VND (256 USD) each from the German Government through the German development bank KfW.
This is part of the 14.5-million-EUR renewable energy development project jointly carried out by the Vietnamese Ministry of Industry and Trade (MoIT) and the German Government during 2019-2021.
The project aims at benefiting 50,000-70,000 households across Vietnam.
In addition, Germany will help the country in training human resources and encouraging the private sector and households to participate in rooftop solar power development activities.
The MoIT has recently approved a programme on developing rooftop solar power in the 2019-2025 period, which aims to support the implementation of the national strategy on renewable energy development.
According to the Vietnam Electricity Group (EVN), more than 9,300 rooftop solar power systems, with a total capacity of 193 megawatt-peak, have been installed as of July 18. EVN has installed 204 of the systems in its branches, and the remaining 9,110 systems have been installed on the rooftops of enterprises’ headquarters and households.
Under the Ministry of Industry and Trade’s Decision 2023, Vietnam is targeting installation of solar power systems in 100,000 households between 2019 and 2025.
Forestry sector enjoys 4.57 bln USD in 7-month trade surplus
The forestry industry gained a trade surplus of over 4.57 billion USD in the first seven months of this year, according to the Vietnam Administration of Forestry (VNFOREST) under the Ministry of Agriculture and Rural Development.
The forestry exports in July were estimated at 893 million USD, bringing the total in the reviewed period to more than 6 billion USD, nearly 5.66 billion USD of which came from the export of wood and timber products.
Export growth was seen from the two major markets – the United States and the European Union. The Voluntary Partnership Agreement on Forest Law Enforcement, Governance and Trade (VPA/FLECT), in effect from June 1, is supporting cooperation between Vietnam and the EU in resolving illegal logging and trade, as well as promoting trade, thus paving the way for more Vietnam’s forestry exports to foreign markets.
The VNFOREST estimated Vietnam planted over 126,000 hectares of forest in the first seven months, representing 51 percent of the yearly goal and up 3 percent from the same period last year.
During the period, the country harvested about 125,000 hectares of forest for 11.5 million cu.m of wood, a year-on-year increase of 5 percent.
From January to July, Vietnam collected close to 1.3 trillion VND (55.9 million USD) in payment for forest ecosystem services, up 11 percent year on year.
By July 28, over 1.97 trillion VND has been allocated to pay 1,342 forest owners across the country for the services they provided.
Vietnam currently has 4,500 enterprises processing and exporting wood and forest products, including 1,863 exporters. They involved more than 700 foreign-invested businesses with a large-scale production and application of technology for production.
For 2019, the forestry sector has set targets of growth rate at 5.5 – 6 percent in production value and export value at 10.5 billion USD.
Tuy Hoa airport to serve international flights in Q4
Tuy Hoa Airport in the south-central province of Phu Yen is able to welcome international flights in the fourth quarter of this year, heard a meeting between the provincial People’s Committee and international airlines and travel agencies on August 1.
According to Director of the provincial Department of Transport, the airport is equipped with systems that ensure flight operations like non-direction beacon (NDB), VOR/DME radio beacon, and instrument landing system, among others.
Last month, the Civil Aviation Administration of Vietnam issued Document No.2361/CHK-QLC approving the operation and upgrade of the passenger terminal at Tuy Hoa Airport.
At the event, Russia’s Azur Air and Ural Airlines inked commitments to operate flights to Tuy Hoa, and coordinate with relevant sides to bring foreign tourists to the locality.
Tuy Hoa airport’s passenger terminal was built in line with the International Air Transport Association (IATA)’s Level of Service C, which means the terminal can provide overall good service to passengers while balancing economic terminal sizing with passenger expectations. It is designed to serve 550,000 passengers a year.
Currently, national flag carrier Vietnam Airlines and low-cost Vietjet Air are operating two-three flights from/to Ho Chi Minh City, and one-two flights from/to Hanoi.
Phu Yen is one of the most beautiful provinces in central Vietnam. It has nearly 190km of coastline bordered with zigzag mountains and dotted with many bays, lagoons, cliffs and reefs. Stunning destinations include Dai Lanh cape, Vung Ro Bay, Mon Beach, Dien Cape and Da Dia reef.
79,300 new businesses set up in seven months
The country had 79,300 newly-established businesses with a combined registered capital of 999.4 trillion VND (42.97 billion USD) in January – July, representing year-on-year increases of 4.6 percent and 29.6 percent, respectively.
The average registered capital of each newly-established firm was 12.6 billion VND, up 23.9 percent, the highest level in recent years.
As many as 24,300 businesses resumed operation, up 29.9 percent against the same period last year.
In the economic sector, 1,100 businesses were established in agriculture, forestry and aquaculture, 21,600 in industry and construction, and 56,600 in services, accounting for 1.4 percent, 27.2 percent and 71.4 percent respectively of the total newly-established firms.
Major economic regions reported an increasing number of newly-established businesses such as the Red River Delta (7.2 percent), the north-central and central coastal region (6.8 percent), and the Central Highlands (10.3 percent).-
Gov’t urges more work for connections to national single window
Deputy Prime Minister Vuong Dinh Hue on August 1 asked ministries to speed up the connection of administrative procedures under their management to the national single window (NSW) as the work remains slow.
During the meeting of the National Steering Committee for ASEAN Single Window, National Single Window, and Trade and Logistics Facilitation (Committee 1899) in Hanoi, Finance Minister Dinh Tien Dung reported that 174 administrative procedures of 13 ministries have been connected to the NSW so far.
Among them, the Ministry of Transport (MoT) and the Ministry of Science and Technology (MST) have met the Government’s roadmap, with the MoT having 87 administrative procedures connected and the MST with six.
However, it will be hard for the ministries to complete the connection of 61 other administrative procedures in 2019 as per the Government’s plan because by the end of July, only 16 procedures were connected to the NSW.
From now until the end of this year, the ministries need to connect another 45 procedures to the NSW, of which the Ministry of Health has 14 procedures, the Ministry of Agriculture and Rural Development 12 procedures and the Ministry of Defense 8 procedures. The three ministries account for up to 75 percent of the procedures that must be connected from now until the end of 2019.
Hue directed ministries and agencies to speed up the process of reviewing procedures and developing information technology systems and related solutions to meet the connections of 61 procedures to the NSW.
At the meeting, Dung reported that regarding the ASEAN Single Window deployment and connectivity outside ASEAN, Vietnam has officially exchanged certificate of origin (C/O) information with six countries, including Singapore, Malaysia, Indonesia, Thailand, Brunei and Cambodia.
As of July 10 this year, the total number of Vietnamese C/O received from countries is 87,355 while the country sent 153,872 C/Os to other countries.
At the meeting, Deputy Prime Minister Hue also said the reduction of the list of goods under specialised management and inspection is still limited, failing to meet the Government’s requirements. Currently, only 15 percent of goods under specialised inspection were removed from the list, while the National Assembly's target is to cut from 15 to 35 percent.
Hue attributed the failure to the fact that some ministries and agencies were slow in issuing circulars to implement the regulations.
He asked the ministries to continually implement reforms with import and export goods in the spirit of trade facilitation but also strengthen trade fraud prevention as mentioned in the Government’s Decision 824/QD-TTg 2019 on strengthening State management against trade and origin frauds.
Referring to the fact that logistics costs of firms account for 20 percent of the country’s GDP and the contribution of the logistics sector to GDP accounts for just 4-5 percent, Deputy Prime Minister required relevant ministries to strengthen the contribution of this industry and reduce logistics costs for firms.
Hue assigned the Ministry of Industry and Trade, in conjunction with other relevant ministries, to study and evaluate the country’s development plans of logistics services in a move to increase competitiveness and develop the services sector to 2025 with its contribution to GDP at 8-10 percent and an annual growth rate of 14-20 percent.
Conference in Ha Tinh province promotes green growth
Scientists and business managers gathered at a conference held in the central province of Ha Tinh on August 1, sharing practical experience in promoting green growth and responding to climate change.
At the event, organised by the Ministry of Natural Resources and Environment in collaboration with the Vietnam Association for Conservation of Nature and Environment and the local Department of Natural Resources and Environment, participants recommended possible measures to carry out the national strategy on green growth and climate change response in each locality and each sector.
Mechanisms and policies to engage local residents in green practices were on the table while the role of social organisations in supervising the implementation of green growth strategy was highlighted.
According to Vice Director of the provincial Department of Natural Resources and Environment Phan Lam Son, as green growth is the core of the province’s sustainable socio-economic development, Ha Tinh province has proactively responded to climate change, promoted economic restructuring by shifting to a more effective economic growth model based on advanced technologies and high-quality human resources.
As a locality hard hit by natural disasters every year, local organisations and businesses have worked to raise public awareness of natural disaster prevention. Meanwhile, a wide range of projects have been carried out to improve the resilience of the community to climate change-related impacts, comprising an embankment construction project in Loc Ha district, water management project in Ha Tinh city, and project to plant, restore and preserve mangrove forests in Nghi Xuan and Cam Xuyen districts, and Ky Anh town.
Petro prices slightly drop in latest review
The retail price of E5RON92 dropped 377 VND to a maximum level of 19,902 VND per litre as from 15:00 on August 1.
Following the latest adjustment by the Ministry of Industry and Trade and the Ministry of Finance, the price of RON95-III decreased 316 VND to 20,919 VND per litre.
Meanwhile, the prices of diesel 0.05S and kerosene are capped at 17,023 VND and 15,966 VND per litre, respectively. Mazut 180CST 3.5S is sold at no more than 15,927 VND per kilogramme
This is the first drop in petrol prices following two consecutive hikes with total rise exceeding 1,000 VND per litre.
The two ministries review fuel prices every 15 days to adjust domestic prices in accordance with swings in the global market.
China ranks third among foreign investors in Vietnam
China approved investment projects and merger & acquisition deals worth 2.45 billion USD in the first seven months of this year, ranking third among foreign investors in Vietnam, said a Chinese official.
At a trade conference within the framework of the Zhejiang International Trade Expo 2019 held in Ho Chi Minh City on August 1, Commercial Consul Li Jianliang at the Chinese Consulate General in the city said the comprehensive strategic cooperative partnership between Vietnam and China has grown in diverse areas with two-way trade exceeding the 100 billion USD benchmark last year.
By the end of 2018, China had invested in 2,149 projects with a total registered capital of 13.4 billion USD in Vietnam, he said.
To Ngoc Son, Deputy Director of the Ministry of Industry and Trade’s Department of Asia-Africa Markets, said Vietnam has increasingly integrated into the world economy and become one of the most attractive markets in the Association of Southeast Asian Nations (ASEAN).
Moreover, 12 free trade agreements, including new-generation deals - the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the European Union-Vietnam Free Trade Agreement (EVFTA) - will open up the door to over the 50 largest economies in the world, he said.
Vietnam has surpassed Malaysia to become the biggest trade partner of China in ASEAN. The country is now the fifth largest export market and the ninth biggest import market of China in the globe, Son added.
HDBank reports record profit in first half of 2019
The Ho Chi Minh City Development Joint Stock Commercial Bank (HDBank) has reported a record pre-tax profit of 2,211 billion VND (94.26 million USD) in the first half of the year.
Its consolidated net interest margin, which rose to 4.4 percent, was among the highest in the banking sector.
Total consolidated revenues were worth 5,173 billion VND (220.56 million USD), of which net interest earnings accounted for 4,354 billion VND (185.61 million USD), a year-on-year increase of 17 percent.
Income from services was 286 billion VND (12.19 million USD), up 27 percent.
Operating expenses and risk provisioning were tightly controlled at 2,430 billion VND (103.59 million USD) and 532 billion VND (22.67 million USD) in line with plans.
As of June 30 the bad debts ratio for the parent bank was only 1 percent. Consolidated bad debts, including at the consumer finance subsidiary, fell from 1.5 percent at the beginning of the year to 1.4 percent, its lowest rate so far.
The bank’s total assets are worth 210,291 billion VND (8.96 billion USD).
It has deposits of 184,785 billion VND (7.87 billion USD) and total outstanding loans of 144,278 billion VND (6.14 billion USD), an increase of 15.3 percent.
Retail banking and financing small and medium-sized enterprises (SMEs) continued to be key growth drivers.
In the second half of the year the lender will adopt risk management methods based on Basel II standards and continue to focus on its retail, SME and consumer banking strategies.
HDBank is one of the leading joint stock banks in providing ‘green’ credit, especially to renewable energy projects. In the first half it lent nearly 6 trillion VND (255.73 million USD) to finance commercial solar power and rooftop solar power.
HDBank was listed among the best companies to work for in Asia by the HR Asia Awards 2019. It has won the Awards for Best Cash Management Service and Best Trade Finance Bank in Vietnam from the prestigious financial magazine Asiamoney.
Foreign tourists to Vietnam top 1.31 mln in July
International tourist arrivals to Vietnam topped 1.31 million in July, up 11 percent month-on-month and 10.7 percent year-on-year, said the Ministry of Culture, Sports and Tourism’s Vietnam National Administration of Tourism (VNAT) on July 26.
Accordingly, the number of foreign visitors to Vietnam in the January-July period surpassed 9.79 million, up 7.9 percent year on year. The number of tourists through air route rose by 4.7 percent, others via sea route down 11.3 percent, and via roads up 25.2 percent from the same period last year.
Arrivals from Thailand went up 48.2 percent, Taiwan (China) up 27.6 percent, the Republic of Korea 22.1 percent, Indonesia 21.2 percent, India 19.9 percent, among others.
Several markets saw downtrend such as Cambodia 51.6 percent, Laos 31.3 percent, Hong Kong (China) 14.5 percent, Finland 9.2 percent, China 2.8 percent and Australia 1.2 percent.
Domestic tourist arrivals reached 52.4 million, and 26.9 million of them stayed overnight. The total tourism revenue hit 401 trillion VND (17.4 million USD), up 8.67 percent year-on-year.
This year, the sector strives to serve 17.5 – 18 million foreign and 85 million domestic visitors, and earned about 700 trillion VND. If the target is reachable, it will fulfill the goal of welcoming 17 – 20 million foreigners by 2020 one year ahead of schedule in accordance with the Politburo’s Resolution No.08-NQ/TW on developing tourism into a pillar economy.
The VNAT has also called on localities, lodging facilities, tourist areas to minimise the use of nylon bags and disposable plastic items; classify, collect and recycle plastic wastes; and use more eco-friendly products.
Green buildings benefit both investors and home buyers
Green buildings provide more benefits for investors in the long term than normal buildings and reduce the economic burden for low- and middle-income families, according to general secretary of Vietnam Real Estate Association (VNREA) Nguyen Viet Chien.
Chien spoke at a workshop in Hanoi on July 26 about the costs and benefits of greening the affordable housing sector. He said investing in affordable housing projects would bring positive results for developers. The market segment could ensure social security for people, especially low income earners in big cities, and ensure the property market continues to develop in a sustainable manner.
“The affordable housing market has been talked about much in the past three years as real demand for the segment was always more than 80 percent,” he said.
A VNREA survey showed that housing demand for the middle- and high-end segment with selling prices of more than 25 million VND per square metre only accounted for 20 to 30 percent and was mainly focused in big cities. Meanwhile, demand for affordable housing priced below 25 million VND per square metre accounted for 70 to 80 percent. However, there was not enough affordable housing to meet demand.
The association predicted that with the rapid urbanisation rate, 40 percent of Vietnam’s population of 100 million people would live in urban areas by next year. Big cities with populations of more than 1.7 million people would struggle to provide accommodations for everyone. To meet demand, the country needs to build about 700,000 apartments by the end of next year.
The association said high demand in the affordable housing sector would provide a good opportunity for real estate developers in the long term and they should consider adjusting their business strategies accordingly.
“This is good news for the market and for low-income earners," Chien said. "However, investor shortcomings and tightening credit policies in the market have been barriers to the segment’s development."
Affordable housing projects have not given attention to applying green designs or smart and energy-saving technologies even though this segment has the most customers and consumes the most energy. For these reasons, applying green solutions in affordable housing could protect the environment.
To encourage the development of environmentally friendly buildings, the Government should have policies and plans as well as a clear definition of what constitutes a green building. These would provide guidance for investors as they develop their projects.
Vu Hong Phong, a specialist on green buildings at the International Financial Corporation, said Vietnam could make green construction much cheaper. In developing countries with rapid construction, the use of EDGF – a green building certification system focused on making new residential and commercial buildings more resource-efficient – can help overcome market shortcomings while only driving construction costs up by one or two percent.
Trinh Tung Bach, Director of the Research and Development Department at Capital House Group which received the EDFG certification for its EcoHome 3 affordable housing project, said those who live in green buildings enjoy a more convenient life, improved health and decreased power and water costs.
“Our apartments were sold more quickly thanks to applying green criteria in our design," Bach told Viet Nam News. "The rapid sale offset for the higher cost of greening our apartments and reducing marketing costs."
Bach said customers at their projects saved 25 percent on electricity and 36 percent on water bills.
“In addition, the long-term value for developers of greening their projects is that their brand will carry more value thanks to good products," he said. "International organisations and foreign partners will want to co-operate with our company."