Public investment to offer benefits to many local businesses

Public investment is expected to play a very important role in promoting economic growth in 2020 and the enterprises in the building material sector are the biggest beneficiaries, economists say.

Minister of Planning and Investment Nguyen Chi Dung at the April Government meeting held on May 5 presented a report on the draft resolution on implementing solutions to ease difficulties for production and business, accelerate disbursement of public investment and ensure social security in the context of Covid-19.

Public investment to offer benefits to many local businesses



Prime Minister Nguyen Xuan Phuc emphasized the need to fulfill disbursement of VND700 trillion worth of capital for public investment this year

In its reports released in late 2019, VNDirect Securities said the disbursement for public investment would not be stepped up much until the end of 2020. However, the Covid-19 outbreak in January 2020 has changed macroeconomic conditions entirely.

The General Statistics Office (GSO) reported that the GDP grew by 3.82 percent in Q1 2020 compared with the same period last year, an 11-year low in Q1, as all business fields were affected by the epidemic.

VNDirect Securities predicted that Vietnam’s GDP would grow by 5 percent in 2020 (it was 7.1 percent in 2019), while industry and construction, service and agriculture would see growth rates of 5.6 percent, 5.3 percent and 2 percent, respectively.

VNDirect Securities predicted that Vietnam’s GDP would grow by 5 percent in 2020 (it was 7.1 percent in 2019), while industry and construction, service and agriculture would see growth rates of 5.6 percent, 5.3 percent and 2 percent, respectively.

 


All the driving forces for economic growth are weak. Exports face lower demand because of the epidemic. Meanwhile, FDI witnessed a sharp fall in Q1 with newly registered capital of $8.6 billion, down by 20.9 percent.

In such conditions, public investment will play an important role in economic growth in 2020 and bring big benefits to building material producers.

The securities company estimated that 40 percent of capital for public investment would be disbursed for 11 component projects of the North-South Expressway and My Thuan-Can Tho Highway.

The construction will need VND8.9 trillion worth of bitumen, VND7.6 trillion worth of structural steel and VND3.8 trillion worth of cement.

The building stone providers would be given the biggest push as the stone demand of these project is equal to 30-35 percent of licensed exploitation capacity.

KSB and DHA are the two companies that VNDirect Securities believes would benefit as stone providers have many quarries in advantageous positions, and have large mining capacity and long term mining licenses.

As for bitumen company, PLC, the only listed bitumen manufacturer which holds 30 percent of the domestic market share, has been named by VNDirect Securities.

The other names believed to benefit include Hoa Phat (HPG) in structural steel, which has Dung Quat steel complex, and HT1 and BCC in cement manufacturing. 

Thanh Mai

Pandemic recovery public investment must be monitored, says committee

Pandemic recovery public investment must be monitored, says committee

As Vietnam employs unprecedented measures to recover from the economic ravages of the COVID-19 pandemic with hastened disbursement of public investment, supervision must be enhanced to prevent profiteering, politicians have warned.

Disbursement of public investment would help lift Vietnam's GDP by 0.42 percentage points

Disbursement of public investment would help lift Vietnam's GDP by 0.42 percentage points

Boosting the disbursement of all planned public investment would help increase this year’s gross domestic product (GDP) by 0.42 percentage points, according to the General Statistics Office (GSO).  

 
 

Other News

.
EuroCham stresses importance of stimulus packages in Vietnam’s post-pandemic recovery
EuroCham stresses importance of stimulus packages in Vietnam’s post-pandemic recovery
BUSINESSicon  08/07/2020 

State financial support for companies hit hard by the Covid-19 pandemic, regardless of the level they are yet, and subject to the Government’s consideration in terms of budget range and macroeconomic stability, 

Private sector involvement proposed in Chu Lai airport project
Private sector involvement proposed in Chu Lai airport project
BUSINESSicon  07/07/2020 

The authority of Quang Nam Province has proposed that private investors be allowed to participate in the construction, management and operation of Chu Lai airport, similar to the investment model adopted for Van Don airport in Quang Ninh Province.

Fitch Ratings says Vietnam outperforms among Asia’s frontier sovereigns
Fitch Ratings says Vietnam outperforms among Asia’s frontier sovereigns
BUSINESSicon  07/07/2020 

According to Fitch Ratings, Vietnam is positioned to stand out among Asia’s frontier and emerging markets this year as a result of its economic resilience and success in bringing the novel coronavirus pandemic under control.

Vietnam’s bond market posts highest growth in emerging East Asia: ADB
Vietnam’s bond market posts highest growth in emerging East Asia: ADB
BUSINESSicon  07/07/2020 

The local currency (LCY) bond market in Vietnam posted the highest growth in the emerging East Asia region, as authorities took fiscal and monetary policy actions to mitigate the economic fallout from the coronavirus pandemic.

China is largest plywood investor in Vietnam
China is largest plywood investor in Vietnam
BUSINESSicon  07/07/2020 

China has invested in 29 plywood projects worth over US$150 million in Vietnam, becoming the country’s largest plywood investor, according to Ngo Sy Hoai, vice chairman of the Vietnam Timber and Forest Products Association.

Customs authority discovers multiple cases of origin fraud
Customs authority discovers multiple cases of origin fraud
BUSINESSicon  07/07/2020 

Country of origin fraud cases, wherein Chinese products bear Made-in-Vietnam labels, are on the rise, with Vietnam’s customs authority recently inspecting 76 cases

Thai firm buys two wind power farms in Vietnam
Thai firm buys two wind power farms in Vietnam
BUSINESSicon  07/07/2020 

The move aims to take advantage of low interest rates to build projects with a quick return on investment.

FIEs displeased with government demand to license internal websites
FIEs displeased with government demand to license internal websites
BUSINESSicon  07/07/2020 

The new regulations of the MIC may affect the policies and assets of private businesses and foreign-invested enterprises in Vietnam.

Amended law alters funding landscape
Amended law alters funding landscape
BUSINESSicon  07/07/2020 

The Vietnamese National Assembly has adopted the new Law on Investment, with new rules in favour of foreign investment, including from the US, which is expected to surge in Vietnam in the time to come.

New investment wave starts despite COVID-19
New investment wave starts despite COVID-19
BUSINESSicon  07/07/2020 

The new wave of foreign investment triggered by COVID-19 and US-China trade tensions is becoming more visible as outstanding overseas ventures are expanded.

Stronger money policies might be considered to aid economic growth: SBV
Stronger money policies might be considered to aid economic growth: SBV
BUSINESSicon  07/07/2020 

The State Bank of Vietnam could increase credit growth limits for credit institutions this year or even launch stronger monetary policies to aid the country’s post-pandemic growth, Governor Le Minh Hung has said.

Guiding decrees needed to fight with transfer pricing in Vietnam
Guiding decrees needed to fight with transfer pricing in Vietnam
BUSINESSicon  07/07/2020 

Anti-transfer pricing measures were included in the Law on Tax Administration for the first time, but a guiding decree has not yet been written. Experts said this could mean the rules are less effective.

VN corporate bond market to boom in second half
VN corporate bond market to boom in second half
BUSINESSicon  07/07/2020 

Companies are looking to raise debts from bond issuance before the amended Law on Securities takes effect next January.

E-commerce in Vietnam thrives during COVID-19
E-commerce in Vietnam thrives during COVID-19
BUSINESSicon  08/07/2020 

“Covid-19 has given e-commerce a push,” said Nguyen Thuy Anh from the Department of E-commerce and Digital Economy.

Local banks warn they may become ‘hostage’ of businesses
Local banks warn they may become ‘hostage’ of businesses
BUSINESSicon  08/07/2020 

If large businesses cannot pay their debts, they may put pressure on banks to lower requirements for loans.

Is there a new wave of bank shares landing in VN stock market?
Is there a new wave of bank shares landing in VN stock market?
BUSINESSicon  08/07/2020 

Commercial banks have six months to fulfill procedures to list their shares on the bourse, as requested by the Prime Minister.

Moving from former adversaries to trusting and valued partners
Moving from former adversaries to trusting and valued partners
BUSINESSicon  07/07/2020 

Through candid dialogue, mutual respect, and a strong commitment to succeed by the leadership of both countries, Vietnam and the United States created a comprehensive partnership that identifies areas for both countries to work together.

EVFTA expected to give a lift to real estate sector
EVFTA expected to give a lift to real estate sector
BUSINESSicon  06/07/2020 

Many segments of the real estate market are soon expected to benefit from the EU-Vietnam Free Trade Agreement, which takes effect in August.

Whether Apple to build nest in Vietnam?
Whether Apple to build nest in Vietnam?
BUSINESSicon  07/07/2020 

Foxconn’s rush expansion in Vietnam raise nosy that whether Apple will choose the country as the place to build nest.

American groups make progress across Vietnam
American groups make progress across Vietnam
BUSINESSicon  06/07/2020 

Vietnam, as one of the fastest-growing economies in the ASEAN bloc, is becoming more appealing to American investors.

 
 
 
Leave your comment on an article

OR QUICK LOGIN