BUSINESS NEWS HEADLINES MARCH 6

VN’s agro-forestry-fishery exports drop 2.8 per cent in first two months

BUSINESS NEWS HEADLINES MARCH 6

Viet Nam exported agro-forestry-fishery products worth a total of US$5.3 billion in the first two months of this year, representing a slight drop of 2.8 per cent against the same period in 2019, updates from the Ministry of Agriculture and Rural Development showed.

In February alone, agro-forestry-fishery exports were estimated at $2.57 billion, up by 33.6 per cent over the same month in 2019, but falling by 7 per cent against January.

Some products saw increases in both export volume and value over the same period last year. Rice export reached 890,000 tonnes (up 27 per cent), worth $410 million (up 33 per cent). Cassava export was estimated at 130,000 tonnes (up 40 per cent), worth $27 million (up 70 per cent).

Meanwhile, exports of tra fish, cashew, rubber, and fruit and vegetable decreased, partly due to difficulties in exporting to China amid the outbreak of the novel coronavirus (COVID-19).

Viet Nam’s agro-forestry-fishery imports totalled $4.3 billion in January-February, decreasing by 6.7 per cent.

According to the ministry, the agriculture sector faced a number of challenges in the first two months of this year. The COVID-19 epidemic was heavily affecting agricultural production and exports, drought and salinisation hitting southern provinces hard while African swine fever caused a severe shortage of pork.

Minister of Agriculture and Rural Development Nguyen Xuan Cuong said the ministry focused on restructuring agricultural production, expanding and diversifying exports markets, improving processing and establishing value chains to cope with the difficulties. Negotiations to expand export markets would be strengthened together with improving product quality and solutions to approach retail systems and supermarket chains in foreign countries.

The ministry also put a close watch on the development of the COVID-19 epidemic and trade with China to develop measures, he said.

Thien Long Group shareholder Newell Brands under US investigation

Newell Brands – an international shareholder of Thien Long Group – might face public backlash since the firm is being investigated by the US Securities and Exchange Commission (SEC) regarding its sales and accounting practices.

The federal investigation is a new setback for Newell – a US-based manufacturer of consumer and commercial products, the maker of Rubbermaid containers and Sharpie markers – as it tries to turn its fortune around under a new leadership team. The SEC issued a subpoena to Newell in January, after making several informal requests for information, as cited by Wall Street Journal.

One focus of the probe, Newell said, is its treatment of goodwill – the premium a company pays when it buys another for more than the value of its net assets. The SEC’s subpoena relates primarily to the company’s “sales practices and certain accounting matters” from the start of 2016 onwards, Wall Street Journal reported.

Newell wrote down more than $9 billion of goodwill and trade names in 2018, one of the biggest goodwill impairments that year, according to valuation firm Duff & Phelps LLC. Newell at the time said most of the write-down reflected a decline in its market value.

Global rating agency Moody’s rated Newell at the lowest investment grade, while the firm was also downgraded to junk-bond status by S&P Global in last November.

Previously, Newell agreed to divest nearly half of its businesses to pay down debts and buy back stock, expecting initially to generate $10 billion in proceeds from those divestitures, but later lowering its expectations to $9 billion.

The company has since sold several units, including Rawlings baseball gloves, Pure Fishing gear, Jostens class rings and yearbooks, and Goody hair products.

Last year, NWL Cayman Holdings, a subsidiary of Newell, invested in Thien Long – one of the leading Vietnamese suppliers of stationery. It is rumoured that the US giant has bought five million shares from Thien Long, equalling to 7 per cent.

Currently, Thien Long is exporting products to 61 nations and is preparing the groundworks and technology for further expansion. VIR also reported that the firm aimed to expand its overseas footprint by priming up investment in other countries, particularly Singapore.

As of March 5, shares of Thien Long trimmed slightly to VND37,800 ($1.64) per share as investors signalled continued anxiety about economic prospects as they piled their funds into safe-haven assets such as gold and bonds.

Work set to restart on Con Dao Passenger Port

The southern province of Ba Ria-Vung Tau is expected to restart work on the Con Dao Passenger Port at a revised cost of VND158 billion (US$6.8 million).

It was first approved by the provincial People’s Committee in 2007 at a cost of VND57 billion ($2.45 million).

Its construction began in 2010 but stalled in 2014 because some items required to be changed.

The cost was revised yet again due to some changes in the construction area and design.

According to the project developer, the Ben Dam Port management board, the new cost estimates have been submitted to the provincial Department of Planning and Investment and are expected to be approved this month.

The construction is scheduled to restart in May and will be completed in October.

Ba Ria-Vung Tau Province is one of the eight provinces and cities in the Southern Key Economic Zone, and is a popular tourist destination.

Con Dao Islands receives thousands of tourists every year. It is set to attract 300,000 by 2030, 20 per cent of them foreign tourists.

Newly-established firms up but capital down in two months

The number of newly-established firms rose 9.1 per cent to 17,400 in the first two months of this year, according to the General Statistics Office (GSO).

During the period, the enterprises resuming operations were up 17.1 per cent year-on-year to 11,900.

However, the new enterprises registered a total capital of VND220 trillion (US$956 million) and 157,500 workers, down 11.1 per cent and 3.9 per cent year-on-year, respectively.

Meanwhile, about 5,700 other businesses registered to add VND421 trillion to their capital.

In total, an additional VND641 trillion was poured into the economy, down 26.2 per cent from the same period last year.

Nearly 16,200 businesses suspended operations in the first two months of this year, up 19.5 per cent annually, reported the GSO.

Up to 9,400 businesses waited for dissolution procedures, down 31.4 per cent and 2,800 others completed the procedures, down 11.1 per cent in the two months.

In February, Viet Nam had 9,163 newly established enterprises with registered capital of VND96.8 trillion, an increase of 10.7 per cent month on month. Average registered capital of the newly established enterprises reached VND10.6 trillion, down 29 per cent month on month and down 35.2 per cent year on year.

There were 3,630 enterprises resuming operations in February, down 57.1 per cent month on month.

In terms of the economic sector, in the first two months of this year, there were 265 newly established enterprises in the agriculture, forestry and fishery sector, up 17.3 per cent year on year; 4,700 new enterprises in the industry and construction sector, up 8.4 per cent; and 12,500 new businesses in the service sector, up 9.2 per cent.

There were four groups seeing reductions in the number of newly established enterprises, including the group of health and social assistance firms, down 10.7 per cent; the group of real estate businesses, down 6 per cent; the group of arts and entertainment firms, down 5.8 per cent; and other service firms, down 6.3 per cent.

To improve the competitiveness of enterprises, Nguyen Minh Thao, head of Business Environment and Competitiveness under the Central Institute for Economic Management, said the State needs to accelerate reforms and serve businesses more effectively. Those would promote development of start-up firms and contribute to the domestic economic growth.

European, Oceania tourists to Hanoi on the rise

The number of tourists from European and Oceania countries to Hanoi continued growing in February, according to the municipal Department of Tourism.

Growth was reported in France (10.7 percent), Spain (11.8 percent), and Belgium (nearly 15 percent).

In the month, Hanoi welcomed 1.3 million tourists, including 362,000 foreigners, down 45.4 percent and 28 percent, respectively.

Sharp declines were seen in the number of visitors from China and the Republic of Korea due to the outbreak of the acute respiratory disease caused by SARS-CoV-2 (COVID-19).

To ensure safety for tourists during the COVID-19 epidemic, local authorities have asked tourism agencies to cancel tours to coronavirus-hit areas and suspend receiving tourists from these zones./.

Yen Bai approves projects worth nearly 130 million USD

The northern mountainous province of Yen Bai granted in-principle approval for 15 investment projects worth a total 3 trillion VND (nearly 130 million USD) during a meeting with investors on March 1.

Yen Bai is home to more than 2,140 enterprises, creating 38,000 local jobs. Last year, the firms contributed 1.17 trillion VND (50.3 million USD) to the local budget, accounting for 54 percent of the province’s revenue.

During the meeting, representatives from enterprises operating in the locality requested local authorities to improve the province’s legal framework, reform administrative procedure and draw up incentive policies for firms specialising in agriculture while offering them support in personnel training and trade promotion.

In recent years, Yen Bai has attracted investment and developed businesses by focusing on improving the investment environment, seeking investors and improving administrative procedures in investment, according to the provincial Department of Planning and Investment.

Last year, the province granted investment certificates to 55 projects, worth more than 17.22 trillion VND. The latest addition brought the number of licensed projects up to 466, valued at 88 trillion VND./.

Vietnamese firms urged to tap Africa, Middle East markets

Africa and the Middle East offer opportunities for Viet Nam to boost exports of farm produce with their large demand, especially for fruits and vegetables, according to the Ministry of Industry and Trade.

Nguyen Minh Phuong of the ministry’s Asia-Africa Market Department said the per capita income in the Middle East is relative high.

Countries in the region mainly focus on industry, and import large volumes of agricultural products, she said.

“The Middle East has very high demand for fruits and vegetables.”

Viet Nam’s fruit and vegetable exports to the region have shot up in recent years, rising from US$44.8 million in 2015 to $96.9 million in 2018, but remain very low as a ratio of total imports, she said.

“The Middle East attracts a large number of Asian workers, and so demand for tropical fruits and vegetables will further increase. Fruit and vegetable exports are expected to grow further in the coming years.”

Africa too has huge demand for agricultural products, mainly rice, seafood, fruits and vegetables, but because of the distance, it is not easy for Vietnamese firms to export fresh fruits to this market though they can sell canned fruit juices and sugar coated fruits, she told an export forum held on the sidelines of Hortex Vietnam 2020 in HCM City on February 27.

Viet Nam has exported fruits and vegetables to 46 out of 70 countries in Africa and the Middle East, with the main markets being the UAE, Saudi Arabia, Turkey, Egypt and South Africa, she said.

Vietnamese firms should focus on exporting watermelon, passion fruit, mango, longan, rambutan, and dragon fruit besides juices to the UAE, she said.

Viet Nam’s fruit and vegetable exports to Saudi Arabia are worth only around $3 million, and exporters need to do market research since consumers in the country prefer sweeter foods than in other markets, she said.

They could export watermelon, mango and sugar-coated fruits to the country, she said.

The South African agricultural sector is strong, but its fruiting season is different from Viet Nam’s, she said.

It has enormous demand for oranges, mangoes, litchi, rambutans and dragon fruit, she said.

She warned Vietnamese firms about challenges they would face when exporting to Africa and the Middle East, including fierce competition and payment methods that are not convenient for them.

They might have less stringent quality requirements compared to many other countries, but to succeed in exporting to them, Vietnamese firms must have long-term strategies, improve product quality and study the market carefully, she said.

They should also understand the regulations in each market and Muslim cultural factors, and need to have labels in local languages, she said.

They need to pay more attention to building brands and increasing the processing rate to add value to Vietnamese fruits and vegetables, she added.

Traditional markets

Dr Le Thanh Hoa, deputy director general of the Agro Processing and Market Development Authority, said fruit and vegetable exports have increased enormously in recent years to reach over $3.8 billion last year.

The market for Vietnamese fruits and vegetables has expanded to 60 countries and territories, including selective ones such as the US, South Korea, Japan, the Netherlands and Australia, he said.

The global fruit and vegetable trade is expected to reach $320 billion this year, and this means Viet Nam has a tiny market share, and so there is much room for the country to increase exports, he said.

But Vietnamese firms should focus more on improving product quality, food hygiene and safety to boost exports to traditional markets like Japan, South Korea, the US and the EU.

They need to pay more attention to Russia and Southeast Asia, he said.

In the case of exports to China, exporters need to switch from border trade to official exports, he said.

In an interview with the media, Willem Schoustra, agriculture counselor at the Netherlands embassy in Ha Noi, said: “Viet Nam has a big ambition of becoming a large agricultural player globally. The challenge for Viet Nam is to work on vertical value chain improvement and processing.”

The free trade agreement between the European Union and Viet Nam could boost exports from both sides, he said.

The sector needs to “find the right investors to increase the volume of processing and develop the whole value chain and branding, packaging and also post-harvest techniques so that the products will have the longest shelf life after harvest,” he said.

The potential for exporting fruits and vegetables to the Netherlands is huge, and a lot is already shipped to the Netherlands and the rest of Europe, he said.

For instance, Viet Nam sells pomelo and lime to the Netherlands, he said.

But to further exploit the potential the European market offer, Vietnamese exporters need to improve the quality of the products, he added.

Banpu enters Vietnamese power generation market

With the recent construction, Thailand’s Banpu Power Pcl. is cementing its footprint in Vietnam, taking the view that the country is a more promising investment destination.

BPP Vinh Chau Wind Power Co., Ltd. , a subsidiary of Banpu Power Pcl., started construction of the 65MW Soc Trang Wind Power Plant No 3. The first phase of 29.4MW is slated for completion at the end of 2020. Each year, the first seven turbines would generate about 84.7GWh of electricity, contributing to national energy security as well as the development of renewable energy in Vietnam.

This is Banpu Power’s first wind power project in Vietnam. The move is in line with its oversea investment and core strategy for “Greener and Smarter”.

Somruedee Chaimongkol, CEO of Banpu Power, said on the company website last year that, “Vietnam is the tenth country that Banpu entered to capture great business opportunities. The country is in the Asia-Pacific region that has fast-growing demand for electricity. The power demand of the country will double to 130GW by 2030 as a result of the country’s economic growth.“

“Given the confidence of our stakeholders in every country we have a business, our strong financial performance and our corporate governance, we are determined to grow sustainable business by looking for further investment opportunities that generate great returns and go in line with Greener & Smarter strategy. We focus on the development of three core businesses, including energy resources (coal and gas including related operations such as marketing, trading, logistics, fuel procurement, and transmission), energy generation (coal-fired and renewables power plants), and energy technology (total solar energy solutions, energy storage system, and energy technology system), in Vietnam and other countries in the Asia-Pacific. These businesses are crucial for Banpu’s future growth and potential to create added values and to maximise long-term returns for our shareholders,” Somruedee added.

In 2019, Banpu increased its target to sell more than 2 million tonnes of coal in Vietnam to a trusted and diverse client base. In January 2020, the group established a new wholly-owned subsidiary in Vietnam named Banpu Vietnam LLC with the registered share capital of VND23 million ($1,000). The objective of the subsidiary is to provide services to support coal and power businesses in Vietnam.

Recently, Thai enterprises are increasing funding into developing Vietnam’s energy sector thanks to the abundance of wind and solar power resources and government incentives for the power sector, especially for renewable energy. Some well-known names are B. Grimm Group and Gulf Energy Development Plc.

Hải Phòng tourism prepares for recovery after COVID-19 epidemic

The tourism sector in the northern coastal city of Hải Phòng is preparing all conditions for recovery after the novel coronavirus (COVID-19) epidemic ends, according to a report from the city authority.

The imminent loss of tourism revenue due to the global epidemic has prompted the sector to outline plans to boost development with a focus on attracting more tourists to the city, the report said.

The city has vowed to continue tourism promotion activities and intensify co-operation with others cities and provinces including participating in a travel promotion event in the northern province of Thái Bình and the annual Việt Nam International Travel Mart Hà Nội 2020 to be held in April in Hà Nội.

It has also committed to sign a tourism development co-operation deal with the capital city.

It will complete a project on managing and developing the Hải Phòng tourism brand by 2025, a research project on the capacity of Cát Bà resort complex while outlining a scheme on tourism development in tandem with agriculture and new-style rural area building.

A travel guide book for Hải Phòng and publications to promote local tourism will be also published soon.

Tourism infrastructure in the city has changed significantly with more 5-star hotels having been built including those of the Vingroup, and the appearance of high-standard cruise services becoming more popular.

The city currently has 502 lodging facilities with 11,806 rooms of which 400 rooms are particularly for those on luxury cruises.

However, the ongoing impact of the COVID-19 epidemic is causing losses to the tourism sector.

In the first two months of the year, the city served over one million tourists, including more than 121,200 foreigners, a year-on-year decrease of 0.2 per cent and 9.8 per cent, respectively.

In February alone, revenue had reduced dramatically due to a drop of about 9.4 per cent in the number of tourists. Last month, it received only 470,000 tourists including 54,400 foreigners – a decrease of nearly 16 per cent compared to the same period last year.

Vũ Tiến Lập, head of Cát Hải District’s culture, sports and tourism bureau, said the number of arrivals to Cát Bà tourism complex fell significantly, particularly those from Asian nations.

During January-February, 172,500 travellers spent their holidays on Cát Bà Island, equivalent to only 78.4 per cent of the number recorded in the same time last year, according to Lập.

The official said despite a decrease in revenue, the sector always put the safety for tourists as first priority in services and that doing tourism business should not be counted in short term but long term in all seasons.

To ensure the safety for tourists as well as tourism staff, hotels and lodges in the city are strictly following hygienic rules for rooms and others interior places in the service areas including spraying sterilising chemicals and temperature examination before check-in for the tourists.

With a wide range of new tourism products, including the high-end Flamingo Cát Bà resort complex, slated to be launched soon, Cát Bà Island expects to welcome more tourists during the Reunification Day (April 30) and May Day (May 1) holidays.

Vietnamese businesses invest $30m abroad

Vietnamese businesses pumped US$30.3 million overseas in the first two months of this year, according to the Foreign Investment Agency.

Of that number, $21.4 million was poured into 20 new projects while the remaining $8.9 million was pledged to two existing projects.

The agency said restaurant and catering services received the lion's share of Vietnamese investment at $14.3 million, 48 per cent of the total. The manufacturing and processing sector ranked second with $8.9 million or 29.4 per cent, followed by the wholesale and retail sector, logistics, and other services.

Among the 12 countries and territories where Vietnamese investors were active in the first two months, the US was the largest recipient with $20 million, followed by Cambodia with $8.9 million or 29.5 per cent. Others were Hong Kong, the United Kingdom and Myanmar.

According to analysts, in order for Vietnamese foreign investment to be more effective and reduce the risks, Vietnamese enterprises need to proactively study and keep themselves updated about policy changes, and to co-operate with the local governments and residents of the countries.

It was necessary to comply with local laws, international laws and related regulations in order to avoid possible disputes during the entire investment process, they said.

More substantive and attractive policies offered by the State to encourage enterprises to increase overseas investment should also included.

Vietnam’s industrial production up 6.2 pct in two months

Vietnam’s industrial production index expanded by only 6.2 percent in the first two months of this year due to the impact of COVID-19 outbreak, much lower than 13.7 percent and 9.2 percent in the same period of 2018 and 2019, respectively.

Of which, manufacturing and processing sector grew by 7.4 percent, contributing six percentage points to the index. Electricity production and distribution sector expanded by 8.4 percent, while water supply and waste treatment sector up 4.9 percent.

Mmining sector posted a 3.7 percent decrease in growth. Other under-performed sectors included crude oil and natural gas exploitation, down 8.6 percent, and wood processing and wooden furniture, down 5.2 percent.

Sectors posted higher growth compared to the same period last year were metal ore exploitation, up 25.4 percent; and coke and refined petrol, up 18.6 percent.

Speaking at a meeting recently held in Hanoi, head of the Ministry of Industry and Trade’s Industry Department Truong Thanh Hoai said Vietnam’s manufacturing and processing sector largely relies on materials and spare parts imported from China, the Republic of Korea and Japan, which are hard-hit by the outbreak, for production.

Last year, Vietnam spent 40 billion USD on importing electronic spare parts from the above three countries. Domestic firms now have enough materials for production till mid- or late March.

In the same situation, almost textile and footwear firms also have sufficient materials till early March or early April.

In case they are forced to temporarily suspend part of or full operations due to the shortage of input materials, they must incur credit rates, machinery maintenance costs and salaries for workers, he said./.

Social housing development fails to meet target

The central city of Da Nang is focusing on developing social housing so as to meet increasing demand of local people.

The city has invested in over 13,000 social houses so far. Its social housing development programme targets another 20,000 houses by 2030.

To that end, Da Nang is calling for more investment in this field. In November last year, the municipal Construction Department signed an agreement on social housing development with the Korea Land and Housing Corporation of the Republic of Korea (RoK).

 

With its experience and capacity, the RoK corporation is expected to contribute to the city’s goal achievement.

Established in 2009 as a State-owned enterprise of the RoK Government, the corporation has built 2.76 million apartments, including 1.12 million social houses, and is carrying out a number of smart urban development and urban reconstruction projects./.

HCM City: February retail sales, service revenue drop

Total retail sales of goods and service revenue in Ho Chi Minh City approximated 239.27 trillion VND (10.4 billion USD) in February, down 5.4 percent month on month but up 11.2 percent year on year.

That included almost 73.6 trillion VND in retail sales, falling 5.2 percent from January but still rising 4.6 percent from the same period last year, the municipal Department of Industry and Trade said on March 2.

Meanwhile, total retail sales of goods and service revenue in the first two months is estimated at over 491.23 trillion VND, up 8.2 percent year on year.

The department explained that since February followed the Lunar New Year holiday, consumption demand fell, especially for commodities in such groups as garment, timber and building materials. Besides, the decline in retail sales and service revenue last month was also attributable to the COVID-19 outbreak, which discouraged people from coming to public places like shopping centres or supermarkets.

Director of the authority Pham Thanh Kien said in this context, his department has been working with businesses, retailers and small traders to tackle difficulties facing them and coordinate goods supplies to meet people’s demand as consumption habits, purchasing power and prices of some goods are currently under impact of COVID-19./.

HCM City a fertile land for start-ups

Ho Chi Minh City is implementing programmes meant to create a launch pad for start-ups and offer favourable conditions for new companies to develop.

According to the municipal People's Committee, more than 44,000 new businesses were established last year and their registered capital was 15 percent higher than in 2018.

This year, the city targets a number of more than 45,000, especially businesses set up by young people aspiring to contribute to the city’s development.

The municipal administration has carried out programmes in recent years to create favourable conditions for start-ups to develop.

It has made efforts to improve the business environment, build an innovative start-up eco-system to create the best conditions for start-ups and ensure equal access for all businesses to resources and opportunities.

In terms of capital access, the city has allocated 1 trillion VND (43.06 million USD) from its budget to support start-ups, including support for business households to turn into companies.

It also has an investment stimulus package worth 2 trillion VND to encourage businesses to upgrade their production technologies.

The HCM City Start-up Investment Fund founded by the Vietnam Youth Federation – HCM City, the HCM City Finance and Investment Company and others also offers excellent support to start-ups.

A 2016-2020 programme seeks to help small- and medium-sized enterprises improve their competitiveness to better integrate into the global economy as part of the city’s target to become a fertile ground for creative start-ups.

Funding is usually the biggest hurdle for start-ups, and so the city would seek to connect them with banks, credit institutions and domestic and foreign investment funds, the Department of Planning and Investment said.

Nguyen Thanh Phong, Chairman of the HCM City People’s Committee, said among the city’s key tasks in 2020 are improving the quality of growth and competitiveness of its economy and increasing the number of new enterprises, with priority given to those using technology and creating value addition.

So it would continue to strongly improve the investment environment to make it more open and transparent, he said.

With its open and transparent policies, the city expects to attract more new start-ups in various sectors this year to help realise its socio-economic goals, he added.

Vu Anh Tuan, director of the Quang Trung Software Business Incubator, said: “New businesses are getting better in terms of both size and quality. Many creative ideas have met the demands of the city and its people. A lot of them have been realised and used by various sectors such as hi-tech, environment, healthcare, education, transport, trade, e-commerce and customer care.”

The start-up community has enthusiasm, intellect and passion and is up-to-date with global technological advancements, he said.

To help start-ups develop, the Government needs to have policies that better meet their needs, he said.

The start-up community should study policies and regulations set by the city and Government and they should take support from entities like incubators, start-up acceleration centres and mentor establishments, he added./.

Credit institutions boost support for clients affected by COVID-19

Credit institutions have so far supported more than 44,000 clients affected by the COVID-19 outbreak, and assistance will continue in the time ahead, heard a meeting between the State Bank of Vietnam (SBV) and those organisations in Hanoi on March 2.

Nguyen Quoc Hung, Director of the SBV’s Department of Credit for Economic Sectors, said credit organisations have assisted the affected clients whose outstanding loans total some 222 trillion VND (9.6 billion USD) through such measures as extending debt repayment deadlines, exempting or reducing loan interests, and cutting down fees.

He noted the epidemic’s impact has made many clients unable to repay their debts on schedule, thus raising the rate of overdue and non-performing loans.

Twenty-three credit institutions have reported to the SBV that about 926 trillion VND in outstanding loans have been affected by COVID-19, accounting for 14.27 percent of their total of this kind and 11.3 percent of the whole system’s figure.

Some sectors highly vulnerable to the outbreak include agriculture, forestry, fisheries, export, import, accommodation and food services, transportation, textile-garment, footwear, electronics, oil and gas, tourism, and education, Hung said.

Nearly 30 commercial banks have coordinated with the National Payment Corporation of Vietnam to exempt and reduce money transfer fees. Besides, the SBV’s National Credit Information Centre has also decreased information service charges to help credit organisations cut down costs and interest rates, according to the official.

At the meeting, participating institutions also pointed out some difficulties in providing support for clients of this group and suggested measures for increasing assistance.

Applauding their activeness, SBV Deputy Governor Dao Minh Tu asked credit organisations to press on with the work.

Tu said the central bank is working with relevant agencies to swiftly perfect the legal system to facilitate both credit organisations and businesses in dealing with damage caused by COVID-19.

He added the banking sector is one of those taking the lead in carrying out drastic solutions to help clients influenced by the disease, and its actions have been highly valued by the Government, businesses and people./.

Wood firms advised to seek alternative material suppliers

Local wood processing enterprises need to expand supply chains with a focus on seeking suppliers from domestic and overseas markets to ease disruptions from China due to the novel coronavirus SARS-CoV-2 outbreak, experts have said.

According to Do Xuan Lap, Chairman of the Vietnam Timber and Forest Product Association (VTFPA), this year may be turbulent for the wood processing industry as the wide-spreading virus outbreak have been impacting trade between Vietnam and China, as well as Vietnam’s exports to other countries.

Lap said in the price of wood products, wood materials account for only 35 percent, while the other cost comes from auxiliary materials such as paint products, which may be US brands but are also made in China.

Lap urged local enterprises to actively and swiftly seek alternative raw material suppliers in Vietnam as well as other countries.

“Domestic enterprises also need to connect with each other so that their products can join the supply chains of export products. When they collaborate to produce products that meet the importers’ demand, they can quickly join the global supply chain,” he told a seminar on prospects for Vietnam’s timber industry in 2020 last week in Hanoi.

However, Lap pointed out that until now, the links in the value chain of the timber industry – vertically or horizontally – are very limited. The newly-formed links are small scaled, between the forestry plantation households and some wood processing companies such as Scancia Pacific, Woodsland and Nam Dinh Forest Products Joint Stock Company.

Foreign direct investment (FDI) still plays an important role in exports with half of Vietnam’s wood export value coming from this sector. However, the links between the FDI sector and domestic companies barely exist, dividing the wood industry into two separate segments – FDI and domestic, Lap said.

Dr. To Xuan Phuc, an expert from Forest Trends, agreed the disruptions in both supply and demand from China would cause delays in the export of Vietnam.

“China is an important source of auxiliary materials for Vietnam’s wood industry with items such as straps, accessories, sliders, hinges, paints and chemicals. Businesses also need to find alternative sources of supplies, especially when the materials imported from the previous period are only enough for 2-3 months of production,” Phuc said.

Wood chips are Vietnam’s main export products to China with a turnover of more than 972 million USD in 2019, or 79.2 percent of total export turnover of wood and timber products. Meanwhile, Vietnam imported wooden planks worth 400 million USD.

Phuc said COVID-19 has driven down demand from Chinese paper and pulp companies. At the same time, halts of some ports in China and its stringent inspection for means of transportation and loading goods activities by ships have also caused difficulties for Vietnam’s exports to this country.

Vu Hai Bang, chairman of Woodsland Joint Stock Company, said the epidemic will have a major impact on wood companies in the early stages but with the dynamic and quick solutions, they will overcome difficulties. He also called on enterprises to search for domestic suppliers.

The US is currently the largest importer of wood and wooden products from Vietnam. In 2019, the US imported 5.1 billion USD worth of wood products, accounting for nearly 50 percent of Vietnam’s total exports and up 42 percent year-on-year.

There are opportunities to expand exports for the timber industry, mainly to the US market, but the risks of trade and investment fraud in the timber industry still go hand in hand with these opportunities, Bang said.

According to experts, the EU-Vietnam Free Trade Agreement (EVFTA) will open wider doors for Vietnam’s wood products to enter the EU market (with tariffs being just 6 percent or less), but any breakthrough exports to this market may be seen until next year after Vietnam’s ratification of the agreement, expected at the National Assembly meeting in the middle of this year.

The Government has set a target of 20 billion USD in wood exports by 2025 – nearly double the current turnover. To achieve this goal, it will require fundamental changes in both business strategies in each enterprise and the development strategy of the whole industry.

The industry meanwhile is also calling on the Government’s support in institutional and policy environment to create the most favourable conditions for their business activities. In addition, the Government also needs to create a channel to promote Vietnam’s clean wood and timber brand./.

Dong Nai’s major industries maintain high growth rate in February

The Index of Industrial Production (IIP) of the southern province of Dong Nai recorded a year-on-year increase of 23 percent in February despite impacts of the COVID-19 epidemic, according to the provincial statistics office.

Major industries of the province such as garment, leather and footwear and wood processing maintained high growth rate thanks to large stock of materials and existing export contracts.

Food manufacturing and processing surged 30 percent against the same period last year, while the textile sectors expanded 23 percent and garment making over 28 percent.

Leather and related products picked up nearly 30 percent in February, and 17.6 percent in the first two months of the year.

The leather and footwear industry, which accounts for the lion’s share in terms of value of Dong Nai’s industrial sector, raked in nearly 686 million USD from export in the month.

Other sectors seeing high growth rate in February included furniture and the processing industry, with 29 percent and 8.6 percent increases, respectively.

In contrast, metal production reported a year-on-year decline of 6.5 percent due to a decrease in Vietnam’s steel export and the impact of imported steel.

Meanwhile, the production of electricity and gas dropped 1.8 percent.

Local authorities said that if the COVID-19 epidemic prolongs in upcoming months, the province will face a shortage of materials, which are mainly imported from China./.

Ministry works on national strategy on industrial development through 2030

The Ministry of Industry and Trade (MoIT) is drafting the National Strategy on Industrial Development through 2030 with a vision to 2045 to submit to the Government in the next quarter.

Nguyen Van Hoi, Director of the MoIT’s Institute of Industrial Strategy and Policy Research, was speaking at a conference to gather recommendations from experts held in Ha Noi on Friday.

The conference was told industries would be selected to get priorities for development in the strategy should be helping the country meet approved industrialisation and modernisation targets.

Viet Nam’s industry is forecast to contribute 40 per cent to the national GDP by 2030, of which processing and manufacturing will make up 30 per cent. The industrial growth rate will average more than 8.5 per cent, of which the processing and manufacturing industry will see a rise of 10 per cent annually.

Dr Duong Dinh Giam from the Vietnam Economic Science Association, said the strategy should include plans to concentrate national resources to build and develop a number of heavy industries, which could compete internationally and deeply involve in global value chains.

These industries would be a basis for the industrial development in the 2030-45 period, helping Viet Nam become a modern industrial country.

“The strategy should focus on developing industries which have high value-added products and large export value, and gradually reduce industries which use mining resources or unskilled labours,” Giam said.

Under the strategy, it is also necessary to create markets for supporting industries to develop and use high technology. Giam said that to promote the high tech application, the Government must focus on solving the current fragmented production.

“The small scale production is causing the country difficulties to apply scientific and technological advances to create a rich source of raw materials and agricultural products at low cost, high quality and ensuring hygiene and food safety requirements,” he said.

The Government should also take measures to better the linkage between production and consumption chains for sustained development, Giam added, suggesting a pilot model of linkage between agricultural cooperatives and processing enterprises in some places had so far gained good results and should be scrutinised for duplication.

Notably, he said, enterprises needed fast legal support from Government and associations when they face trade disputes in the international market.

According to Pham Tat Thang, MoIT’s senior industrial specialist, the Vietnamese economy has seen remarkable progress, which has contributed to improving living standards. However, the proportion of the industry and construction in the country’s GDP has increased very slowly.

Besides promoting the development of supporting industries to boost the exports of the country’s key consumer goods such as textiles, footwear, ceramics and handicraft products, Thang suggested the industrial sector must also focus on deep processing to enhance the shipment of agricultural and aquatic products as well as other environmentally friendly products to keep pace with the fourth industrial revolution.

State budget collection tops $9.3 billion in two months

Total State budget collection was estimated at VND214.2 trillion (US$9.31 billion) in the first two months of this year, or 14.2 per cent of the yearly estimate, reported the General Statistics Office on February 29.

Of the figure, VND179.8 trillion was domestic revenue, VND8.6 trillion came from crude oil, and VND25.9 trillion from exports-imports.

In domestic budget collection, VND21.3 trillion was from State-owned enterprises, VND36.5 trillion from foreign-invested firms, exclusive of crude oil, VND42 trillion from industry and trade taxes and non-State services, and VND15.3 trillion from individual income tax.

In the same period, total State expenditures stood at VND145 trillion, or 8.3 per cent of the estimate. Of which, VND116.1 trillion was regular spending, VND7.4 trillion for development investment, and VND21.4 trillion for debt interest payment.

ACB introduces $1 million in loans to support COVID-19 affected borrowers

Asia Joint Stock Commercial Bank (ACB) on Wednesday introduced a stimulus loan package worth VND25 trillion (US$1.08 million) to support enterprises and individuals affected by the coronavirus (COVID-19) epidemic.

The package, lasting until the end of June, includes VND12 trillion for small- and medium-sized enterprises.

The bank offers low interest rates for new loans on the evaluation of the business operation amid the epidemic.

Interest rate of the short-term loans for the SMEs is only 6.5 per cent per year and the rate for medium- and long-term loans is 8.5 per cent per year. Currently, the short-term lending rate averages at 7-9 per cent per year and 9-11 per cent per year for medium- and long-term loans.

Borrowers of the loans will not have to repay the principals in 12 months besides a free fee for prepayments.

Sóc Trăng farmers reap bumper crop of crustacean eggs

The harvest of Artemia eggs has entered the peak season in Vĩnh Châu Town in Sóc Trăng Province, and yields and incomes are high because of favourable weather conditions.

The Cửu Long (Mekong) Delta town is well – known for its high-quality Artemia eggs since it has good saltwater conditions for breeding the crustacean.

Artemia, also known as brine shrimp, is a small aquatic crustacean with an adult length of 8 – 12mm and can reproduce eggs when their breeding fields have saltwater with a salinity rate of more than 80gm per littre.

Trần Lũy, who has a 4ha field in Lai Hòa Commune, said he has harvested 200kg of eggs so far in this crop over 20 days.

Farmers can harvest 80 – 100kg of per hectare in a good crop, he said.

“The hot weather this year has been very favourable for breeding Artemia.”

The yield of eggs this year is higher than last year while selling price is high, according to farmers.

Sơn Chanh Tria, director of the Salt - Shrimp - Artemia Production and Service Co-operative in Lai Hòa, said the eggs fetch VNĐ1.1 million (US$47) a kilogramme now, the same as a year ago.

“Artemia famers have bigger incomes than last year.”

The co-operative’s members are breeding 150ha of the crustacean.

Artemia can reproduce in two modes, eggs and nauplius -- the latter being the first larval stage of many crustaceans -- depending on the prevailing ecological conditions. But farmers only seek to produce eggs.

When the eggs are harvested and processed, they can be stored for a very long time. When the processed eggs are provided sufficient hatching conditions, they will hatch into nauplii, which are ideal food for fish and shrimp larvae, since they have high nutritional value.

This year farmers in the town are breeding Artemia on more than 800ha, mostly in Vĩnh Phước Ward and Vĩnh Tân and Lai Hòa communes.

Lai Hòa has 229 households and a total of 312ha.

The area is higher than last year because of the favourable weather conditions and availability of saltwater.

Võ Hoàng Nam, deputy chairman of the Lai Hòa Commune People’s Committee, said many irrigation canals in the commune have been dredged to supply more saltwater.

When farmers have a bumper harvest and high prices, they could earn VNĐ50 million ($2,150) per hectare per crop, he said.

In the town, the crop usually starts in November and lasts until April. The coastal town has saltwater year round.

The crustacean has enabled many farmers in the town to become wealthy since the supply of its eggs cannot meet market demand now.

Their farming costs are not high since Artemia feed on algae.

People in the town also breed them in salt fields, which are even better for raising them.

Many have switched from making salt or raising shrimp to Artemia farming in recent years since it rarely entails losses because of drought or saltwater intrusion.

To improve farmers’ incomes, town authorities have been increasingly disseminating information about Artemia farming schedules and breeding techniques in recent years.

The eggs are sold domestically and exported to many Asian countries, the US and Russia.

Work starts on another wind power plant in Soc Trang

Construction began on a wind power plant in Vinh Chau town in the Mekong Delta province of Soc Trang on March 5.

This is the second wind power plant built in Soc Trang since the beginning of 2020 and the fourth in Vinh Chau town so far.

Invested by the Quoc Vinh Soc Trang Wind Power Linited Company, the plant has a total capacity of 129 MW. Its first phase has a designed capacity of 30 MW and an investment of 1.42 trillion VND (61.2 million USD). The first phase is expected to be completed in 2021.

Meanwhile, the second phase has a designed capacity of 99 MW and an investment of 3.9 trillion VND. Construction on the second phase will begin when all requirements are met.

Le Anh Tung, Chairman of the Member Council of the Quoc Vinh Soc Trang Wind Power Limited Company, said that to ensure long-term and stable operation, the company will use the best turbines from Europe and the US. The company will also use 7.5 hectares of land for the entire project.

He committed to prioritising human resources in the locality so as to create jobs for local labourers.

Vice Chairman of the provincial People’s Committee Lam Hoang Nghiep stated that once operational, the plant will contribute to boosting socio-economic development in Soc Trang in general and Vinh Chau town in particular.

Soc Trang has given priority to calling for investment for 21 wind power development projects in the 2017-2020 period, including 18 ones in Vinh Chau town./.

HCM City greets over 1.18 million foreigners in first two months

Ho Chi Minh City welcomed more than 1.18 million foreign visitors in the first two months of 2020, a year-on-year decline of 21.71 percent, revealed the municipal Department of Tourism on March 5.

Tourism revenue hit about 21.13 trillion VND (915 million USD) in January-February, or 15 percent of the year’s plan.

In February alone, 346,650 holidaymakers chose HCM City as their destination, dropping 52 percent compared to the same period last year. The city earned 8.1 trillion VND from tourism in the month.

Director of the municipal Tourism Department Bui Ta Hoang Vu said the department has spared no efforts in providing information and guidance on COVID-19 prevention for local residents, domestic and foreign tourists.

He added that the local tourism sector is keeping a close watch and joining hands with travel agents to study their operation before and during the COVID-19 outbreak. The move aims to evaluate and seek solutions to mitigate impacts of the disease to local tourism.

About 1,520 travel firms are eligible to operate in the city, including 869 international and 885 domestic ones.

This year, the city sets a target of attracting 10 million foreign visitors and 35 million domestic tourists. It also strives to earn 165 trillion VND (more than 7.1 billion USD) from tourism services./.

 
 

Other News

.
Policies encourage automakers to assemble cars in Vietnam
Policies encourage automakers to assemble cars in Vietnam
BUSINESSicon  06/08/2020 

 Several automakers are considering assembling their best-selling models in Viet Nam due to the Government’s policy of zero import tariffs on components and a 50 per cent reduction in registration fees.

Thai firms acquire wind power farm in Ninh Thuan
Thai firms acquire wind power farm in Ninh Thuan
BUSINESSicon  06/08/2020 

Thailand’s Banpu and its power business arm Banpu Power (BPP) have joined forces to acquire El Wind Mui Dinh, an onshore wind farm in the south-central province of Ninh Thuan, in a deal worth $66 million.

EVFTA smooths the way for Vietnamese farm produce
EVFTA smooths the way for Vietnamese farm produce
BUSINESSicon  06/08/2020 

The EU-Vietnam Free Trade Agreement, at its core, aims to liberalise both tariff and non-tariff barriers on key exports of both sides over a period of 10 years.

Vietnam receives positive view in global exports as EVFTA takes effect: report
Vietnam receives positive view in global exports as EVFTA takes effect: report
BUSINESSicon  05/08/2020 

Vietnam is expected to continue growing its share of global exports despite decline amid the resurgence in the COVID-19 pandemic after three months of no local transmissions, according to an HSBC report.

Local banks are racing to catch digitisation trend: expert
Local banks are racing to catch digitisation trend: expert
BUSINESSicon  05/08/2020 

Vietnam has seen a digital wave in the finance-banking industry, with many lenders investing significantly in digitisation, experts have said.

Experts call on Vietnamese government to aid businesses again
Experts call on Vietnamese government to aid businesses again
BUSINESSicon  05/08/2020 

Amid the new COVID-19 outbreak, experts have suggested the Government offer another credit support package to help enterprises, especially large businesses in key areas.

Vietnam's textile and apparel firms lack orders for the last two quarters
Vietnam's textile and apparel firms lack orders for the last two quarters
BUSINESSicon  05/08/2020 

The Ministry of Industry and Trade said that textile production increased by 1.8 per cent, while clothing production decreased by 4.6 per cent in the first seven months of this year over the same period last year.

New power pricing mechanism to be applied next year
New power pricing mechanism to be applied next year
BUSINESSicon  05/08/2020 

The common retail power price is expected to be applied at the beginning of next year together with the current tiered pricing mechanism, said Deputy Minister of Industry and Trade Do Thang Hai.

VN tra fish companies see profits slump in pandemic
VN tra fish companies see profits slump in pandemic
BUSINESSicon  05/08/2020 

Multiple tra fish companies suffered losses due to falling export prices and lower orders, focusing instead on the domestic market amid the COVID-19 pandemic.

EVFTA hoped to help with sustainable poverty reduction in Vietnam
EVFTA hoped to help with sustainable poverty reduction in Vietnam
BUSINESSicon  05/08/2020 

The EU-Vietnam Free Trade Agreement (EVFTA), which came into force on August 1, is hoped to create a driving force to help Vietnam reap further achievements in poverty reduction and economic growth.

Analysts: High-end hotels hold appeal among investors
Analysts: High-end hotels hold appeal among investors
BUSINESSicon  05/08/2020 

Analysts from real estate consultant Jones Lang LaSalle have said domestic and foreign investors alike are actively seeking to purchase high-end hotels in downtown areas, mostly due to limited land supply.

Economists warn of ‘psychological inflation’ in Vietnam
Economists warn of ‘psychological inflation’ in Vietnam
BUSINESSicon  06/08/2020 

The high CPI increase in the first half of the year will challenge the regulation of goods and service prices in the remaining months of the year, experts say.

Capital is cheap, but there are few borrowers
Capital is cheap, but there are few borrowers
BUSINESSicon  06/08/2020 

The capital cost has never before been so low. In the interbank market, the VND overnight interest rate was 0.13 percent per annum on July 8, according to the State Bank of Vietnam.

Wooden plank exporters struggle with higher tax rates
Wooden plank exporters struggle with higher tax rates
BUSINESSicon  04/08/2020 

The Vietnam Timber and Forest Product Association has sent an urgent petition to the Ministry of Finance, Ministry of Agriculture and Rural Development and Ministry of Industry and Trade about congestion of wooden planks

E-wallet firms battle for slice of cashless payment pie
E-wallet firms battle for slice of cashless payment pie
BUSINESSicon  04/08/2020 

E-wallets firms are battling for a piece of the cashless payment market amid rapid growth in the context of the COVID-19 pandemic.

Corporate income tax reduction comes into effect
Corporate income tax reduction comes into effect
BUSINESSicon  04/08/2020 

Resolution 116/2020/QH14 granting a reduction of 30 per cent on corporate income tax (CIT) for eligible enterprises officially came into effect on Monday.

Big rearers win big
Big rearers win big
BUSINESSicon  04/08/2020 

Many animal husbandry enterprises are leveraging the pork supply shortage to sell at high prices, earning huge profits

VN businesses slow in preparing to enjoy preferential tariffs in EVFTA
VN businesses slow in preparing to enjoy preferential tariffs in EVFTA
BUSINESSicon  04/08/2020 

 Experts have raised concerns that Vietnamese businesses are slow in preparing conditions to enjoy preferential tariffs in the Viet Nam-EU Free Trade Agreement (EVFTA).

Probe into Tenma Vietnam’s alleged bribery underway: police official
Probe into Tenma Vietnam’s alleged bribery underway: police official
BUSINESSicon  04/08/2020 

The investigation into the Japanese-invested Tenma Vietnam company’s allegation of bribing civil servants and tax and customs officers of northern Bac Ninh province is still ongoing, according to a police official.

VN textile, electronics hardest hit in pandemic: official
VN textile, electronics hardest hit in pandemic: official
BUSINESSicon  04/08/2020 

Textile and electronics have been the two export-oriented sectors mostly impacted by the COVID-19 pandemic, an official has said.

 
 
 
Leave your comment on an article

OR QUICK LOGIN