BUSINESS NEWS HEADLINES APRIL 16

Agriculture ministry proposes maintaining sticky rice exports

BUSINESS NEWS HEADLINES APRIL 16

No new COVID-19 cases reported on April 16 evening

The Ministry of Agriculture and Rural Development (MARD) on April 16 proposed continuing exports of sticky rice harvested from the 2019-2020 winter-spring crop.

In a document sent to the Ministry of Industry and Trade, the MARD requested it provide updates on such exports and market demand as a foundation for any adjustments to sticky rice cultivation areas and output in upcoming crops.

Sticky rice is not listed within the national food reserves under Decree No. 94/2013-ND-CP.

It is primarily cultivated in the Mekong Delta, Vietnam’s “rice bowl”.

In the 2019-2020 winter-spring crop, the rice variety was grown on about 65,000ha and 44,000ha in the Delta’s Long An and An Giang provinces, yielding approximately 258,000 tonnes and 195 tonnes, respectively./. 

Investment in HCM City’s export processing, industrial zones up 86 percent

Export processing and industrial zones in Ho Chi Minh City saw 117 million USD of investment poured into the zones in the first quarter, a 86 percent increase compared to the same period last year, according to the HCM City Export Processing and Industrial Zones Authority (HEPZA).

FDI in the zones was nearly 66 million USD, a 2.58 percent increase year-on-year.

Eleven FDI projects registered more capital of over 60 million USD. There were six new projects with total capital of 5.48 million USD, a 74 percent decrease from last year.

The zones received 1.1 trillion VND (47 million USD) worth of domestic investment, up by 37 percent year-on-year. There were 13 new projects, while 12 projects increased their capital.

The increase in investment in the zones was mainly from domestic sources and foreign projects that already had plans to register more capital, according to the authority, which said that investment attraction in the second quarter may face challenges due to the COVID-19 pandemic.

HCM City, as of March 20, had attracted over 1 billion USD worth of FDI, a 33 percent drop year-on-year, according to the HCM City Statistics Office./.

Four key North-South railway projects set to get underway

Work on four projects along the North-South railway will begin in May and June, according to the Transport Engineering Construction and Quality Management Bureau.

Considered “urgent”, the projects will use 7 trillion VND (nearly 300.5 million USD) from State budget reserves for mid-term investment during the 2016-2020 period.

They are among 14 urgent transport projects receiving total funding of 15 trillion VND and approved by the Standing Committee of the 14th National Assembly in July 2018.

They include the upgrade of dilapidated bridges on the Hanoi - HCM City line, which is expected to begin in May, and the repair of tunnels and construction of new stations on the Vinh - Nha Trang stretch, which will begin in June.

Upgrades to the Hanoi - Vinh and Nha Trang - HCM City stretches are also scheduled to begin in June.

According to the Railway Project Management Board, most bridges along the North-South line were built at least a century ago under French standards that are no longer appropriate.

Stone and concrete abutments have weathered over time, and steel girders have split or are covered in rust.

Moreover, many lines were severely damaged during wartime. Though bridges were repaired, their capacity remains limited and lowers the competitiveness of railway compared to other means of transport.

The need for repair or replacement has become urgent, in order to ensure safety. Failing to upgrade low-quality bridges along the North-South line would create risks to both trains and passengers./.

Mask, protective clothing exporters must meet EU standards: Authority

Enterprises shipping face masks and protective clothing to members of the EU need to pay due attention to the standards imposed by the EU or its respective members, the Vietnam Trade Office in Belgium has said.

Products must obtain a CE marking that indicates standards for products sold within the EU have been met, or meet the system set by the EU and each member found at https://standards.cen.eu/dyn/www/f?p=CENWEB:5:::NO:::.

In the face of the COVID-19 pandemic, a rising number of face mask and protective clothing producers in Vietnam have sought business partners to export these items to the EU, the office explained.

Products failing to meet the standards may not be able to enter the EU, causing waste and economic losses if alternative markets are not readily available, it added.

Enterprises are advised to study the standards for face masks and medical protective suits found at https://ec.europa.eu/commission/presscorner/detail/en/IP_20_502 or https://www.centexbel.be/en?utm_source=zalo&utm_medium=zalo&utm_campaign=zalo&zarsrc=30./. 

PV Power fulfills 23 per cent of yearly revenue target in Q1

PetroVietnam Power Corporation (PV Power) reported revenue of nearly VND7.8 trillion (US$334.7 million) in the first quarter of this year, more than 23 per cent of the annual goal.

The company recorded more than 5,267 million kWh of electricity output in the quarter.

In March alone, electricity output reached 2.1 billion kWh, exceeding 4 per cent of the monthly plan. Revenue from factories reached VND3.1 trillion, 98 per cent of the monthly plan.

In April, PV Power, a fully-owned company of the Viet Nam National Oil and Gas Group, expects to reach electricity output of 1.9 million kWh and revenue of VND2.98 trillion.

During March, Ca Mau 1 and Ca Mau 2 Power Plants’ output reached 745.01 million kWh, equivalent to 117.8 per cent of the monthly plan. Vung Ang 1 Thermal Power Plant’s output also exceeded its goal by 28 per cent, reaching 751.86 million kWh.

In contrast, Nhon Trach 1 Plant saw electricity output lower at 122.6 million kWh, only 44.5 per cent of its target. Nhon Trach 2 factory achieved 95 per cent of the plan.

Regarding the two new projects of Nhon Trach 3 and Nhon Trach 4 power plants, PV Power has completed the project feasibility study report and submitted it to the Ministry of Industry and Trade for basic design evaluation and the Ministry of Natural Resources and Environment for approval of the environmental impact assessment report.

After receiving feedback, PV Power will seek the approval of the General Meeting of Shareholders for project construction investment.

The corporation is working with credit institutions and banks to seek capital for the projects, including with EVN EPTC and PV Gas to negotiate the contents in the power purchase agreement and gas purchase agreement for the projects.

Publishing house to divest capital from Tan Mai Group

Viet Nam Education Publishing House Limited Company will auction off 7,216,576 shares at Tan Mai Group at the Ha Noi Stock Exchange (HNX) on April 29.

The shares are equivalent to VND72.1 billion (US$3.07 million), accounting for 8.1 per cent of the group's charter capital with an initial price of VND11,500 per share.

Tan Mai Group, formerly known as Viet Nam Paper Technology Company, was established in 1958 as a State-owned company.

It has been equitised and operated as a joint-stock company since 2006.

The company has undergone seven increases of charter capital from 2006 to 2013 from VND348 billion to VND890 billion.

Shareholders holding more than 5 per cent of the company's charter capital include Viet Nam Paper Corporation (22.6 per cent), Viet Nam Education Publishing House Limited Company (8.1 per cent) and an individual (61.7 per cent).

Before 2012, the company's main product was paper. Currently, the company's main activity is investing in real estate and forestry projects.

The company has suffered losses since 2012 due to ceasing paper production.

SIC to buy 1 million shares of Military Bank

SCIC Investment One Member Company Limited (SIC) has registered to buy 1 million shares of Military Commercial Joint Stock Bank (MBB) for financial investment.

SIC is a subsidiary of the State Capital Investment Corporation (SCIC) and currently owns 13 shares of MBB, a large local lender with a market capitalisation of more than US$1.6 million.

The transaction time will last from April 16 to May 15.

MBB shares are now priced at VND15,750 ($0.7) per share, down 25 per cent from the beginning of the year. At this price, SIC will spend about VND16 billion for the purchase.

SIC sold nearly 1.8 million MBB shares between December 18 last year and January 10 this year, at a time when the MBB price was about VND22,000 per share. After the sale, SIC had only 13 shares left in MBB.

SSI Research forecasts that MBB can still grow well amid the impact of COVID-19 pandemic. If the pandemic is controlled at the end of the second quarter, SSI said MBB’s pre-tax profit for 2020 could increase by 9.3 per cent to VND10.96 trillion.

This increase would still be lower than last year’s growth of 29 per cent.

SIC was established on January 18, 2013, wholly owned by the State Capital Investment Corporation (SCIC). This member company has a charter capital of VND1 trillion with two main functions of financial investment and project investment.

In addition to MBB, SIC previously also registered to buy 1 million shares of FPT Corporation for long-term financial investment, not having owned any FPT shares before this purchase.

Ba Ria – Vung Tau to grant ownership certificates for condotels

The People’s Committee of Ba Ria – Vung Tau Province has urged relevant departments to speed up issuance of ownership certificates for condotels to ensure the healthy development of the segment.

The municipal Department of Natural Resources and Environment would be in charge of providing detailed instructions for granting land and house ownership certificates for condotels.

Ba Ria – Vung Tau People’s Committee also asked the Department of Construction to tighten the management on construction planning and urban development related to condotels. In addition, inspections on adjustments of planning and conversion of real estate projects must be strengthened to prevent violations.

The provincial authority also urged caution about proposals to convert condotel projects into housing projects, stressing that the conversion must comply with established regulations about investment, urban planning and construction as well as be appropriate for the approved land use and housing development planning.

Under-construction condotel projects in Vung Tau include a five-star Pullman hotel and international conference centre complex developed by DIC Corp with hundreds of condotels, the Song Vung Tau condotel project with a total investment of VND1.4 trillion (US$60 million) and more than 1,500 condotels and Vietpearl Unit Hotel on Tran Phu Street with an investment of more than VND475 billion.

In mid-February, the Ministry of Natural Resources and Environment issued a document providing guidelines to local departments for granting ownership certificates for non-residential works like condotels and officetels.

The ministry’s guidelines are expected to promote a healthy condotel market development which has been off-track for years due to an unclear legal framework which has discouraged both developers and investors.

VAMA sales of cars drop 33 per cent in Q1

Members of Vietnam Automobile Manufacturers’ Association (VAMA) suffered a dramatic drop in sales of the first quarter of this year.

The firms sold just more than 50,000 cars in the period, marking a year-on-year decrease of 33 per cent.

According to VAMA, sales of passenger cars and commercial vehicles fell by 35 per cent and 26 per cent respectively compared with the same period last year.

Of which, the volume of locally-assembled cars decreased by 28 per cent in the first quarter while imported cars dropped by 39 per cent year-on-year.

VAMA statistics also showed that automotive brands are facing very poor business conditions amid the COVID-19 pandemic. In addition, many automakers including Toyota Motor Vietnam (TMV), Ford, Honda, Nissan and TC Motor have suspended production and closed showrooms.

In March, TMV’s sales were 5,510 units, excluding the Lexus car, marking a drop of 44 per cent year-on-year but still held the leading position in the market.

The sales of Ford, Mazda and Honda decreased by 48 per cent, 49 per cent and 39 per cent, respectively.

To help automakers overcome their difficulties, the Ministry of Industry and Trade (MoIT) recently asked the Government to cut registration fees in half for domestically-assembled cars from this month until the end of this year.

The proposal was submitted to the Government after VAMA reported to the MoIT on automakers' struggles.

According to the MoIT, many businesses in tourism, services, entertainment and transportation have had to minimise or suspend operations, so the number of customers has dropped sharply, affecting sales.

VAMA forecasts that the automobile market in 2020 may decline by more than 15 per cent year-on-year.

For other taxes, MoIT asked the Government to revise regulations on special consumption tax on domestically-manufactured and -assembled cars, helping the domestic automobile industry cut prices and maintain production.

VAMA last month also proposed the MoIT and the Government consider reducing 50 per cent of value-added tax (VAT). It recommended extending the payment of VAT and special consumption tax from March to September 2020. 

Paper, packaging firms hit by COVID-19 fallout

Domestic paper and packaging firms face a shortage of raw materials and a slump in both domestic and export demand.

Many packaging manufacturers said orders have fallen by 30-50 per cent year-on-year since the start of February.

They mainly supply firms in sectors like garment and textile, footwear and others to package for export, and demand has fallen since the latter’s exports have, they said.

Nguyen Van Thanh, director of Phu Nguyen Thinh Phat Packaging Production, Trading and Services Co., Ltd, told Sai Gon Giai Phong (Saigon Liberated) newspaper: “Orders decreased by about 30 per cent. The reason is that the company mainly supplies packaging to export enterprises. Recently, their exports have run into difficulties due to the pandemic.

“Many garment enterprises have cancelled their long-term contracts [with us], and signed seasonal contracts instead for tens of thousands of packaging boxes each. A number of others stopped order because they have no new export orders.”

Investment in the pulp industry remains modest, causing heavy reliance on imports.

But the COVID-19’s spread to many countries and territories has made it hard to import pulp, according to the Viet Nam Pulp and Paper Association (VPPA).

The association said many scrap paper suppliers abroad have cancelled their orders.

Dang Van Son, the VPPA’s deputy chairman and general secretary, said: “According to our assessment, large manufacturers have very small stocks of raw materials, enough only for one to two months. Many small and medium-sized enterprises have run out of inventory.”

If the situation prolongs, many firms have to close down, he said.

Also according to the VPPA, the prices of raw materials have increased by VND200,000-300,000 per tonne, sending manufacturing costs surging.

Many Vietnamese paper producers are small, mostly with a capacity of less than 30,000 tonnes per year, and use old equipment, and so they are not very competitive, it said.

Most local firms focus on normal packaging paper and export it, and the country has to import over a million tonnes of high-class coated packaging paper, high-class copy paper, coated printing paper, and other special kinds of paper every year, the business group said.

Firms therefore need to adjust their product structure, it said.

It is currently trying to help businesses find raw materials and funding to help them maintain production.

It has also petitioned relevant ministries to streamline import procedures and speed up customs clearance to help businesses quickly source raw materials.

It has also urged the Ministry of Transport to help reduce logistics costs for paper companies.

Mitsubishi Motors allowed to produce eco-friendly cars in Thailand

Mitsubishi Motors Corp. has been given the green light from Thailand for its electric and hybrid vehicle production plan as the Southeast Asian country struggles to minimise the impact of COVID-19 on its economy.

Accordingly, the Board of Investment of Thailand said on April 13 that it approved Mitsubishi's 5.48 billion baht (167 million USD) project to renovate existing production lines at a plant in Laem Chabang Industrial Estate, southeast of Bangkok.

As planned, Mitsubishi will manufacture 39,000 units annually to sell in Thailand and neighboring Southeast Asian countries. Its subsidiary in Thailand will make 9,500 electric vehicles and 29,500 hybrid cars per year.

The board said Mitsubishi's eco-car production is scheduled to start in 2023./.

HCM City shut downs factories, businesses at a high risk of spreading COVID-19

The People's Committees of all 24 districts in HCM City were expected to submit a report on the assessment of COVID-19 infection risks at businesses and factories to the city’s Standing Committee office this afternoon.

Businesses that do not meet the requirements of epidemic prevention will be required to shut down immediately.

On April 11, the HCM City’s Standing Committee directed districts’ people committees to strengthen the assessment of virus infection risks at businesses and enterprises in the city.

Since then, the district authorities and related units have quickly and strictly assessed all businesses.

During the assessment process, the city’s People Committee decided to temporarily shut down operation of the PouYuen Viet Nam company in Binh Tan District for two days from April 14 to 15.

The company's risk of COVID-19 infection had reached 91 per cent after the city authority completed the assessment.

PouYuen Viet Nam has more than 60,000 workers, and has three working shifts.

According to the city People's Committee, if COVID-19 infections occur at the factory, the consequences will be very serious.

On April 6, the city’s Standing Committee issued a set of indicators to assess the risk of virus infections at businesses and enterprises.

The indicators are based on 10 factors: the number of workers, the density of workers in the factory, workers who wash hands before entering and leaving the factory, percentage of workers wearing masks, number of workers whose temperature is checked, number of workers using public transport or company pick-up vehicles to workplace, number of pick-up points on the route to the factory, the distance between workers at the cafeteria, night shifts, and enough masks for workers.

According to the set of indicators, enterprises will be graded on a maximum scale of 10 points for each component.

The businesses will be asked to shut down immediately if they score more than 80 points. Businesses scoring from 50 to 80 points will be also asked to shut down unless they come up with solutions to mitigate the risks.

Other businesses will be allowed to operate normally but will be supervised constantly by authorities.

According to the city’s Department of Labour, Invalids and Social Affairs, the city has about 3.2 million factory workers at 415 enterprises.

 

SCIC asked to focus on key sectors

Deputy Prime Minister Truong Hoa Binh has asked the State Capital Investment Corporation (SCIC) to focus its investments on key sectors of the economy to boost efficiency and contribute to socio-economic development.

The SCIC should focus on sectors like information technology, telecommunications, food processing, finance, petrol and oil, aviation and railways, Binh said, asking for development strategies for each sector to be clarified.

Binh noted that the SCIC should not take on too many enterprises which might result in inefficient management, adding that restructuring of its member companies should be carried out through divestments and merger and acquisition deals.

The SCIC needed to define an appropriate long-term development strategy to become a spearhead of the economy and contribute more to stabilising the macro-economy, ensuring national security and developing State capital, Binh said.

He also asked the SCIC to ensure transparency in its divestment policies, to evaluate State assets accurately.

Binh urged the Commission for the Management of State Capital (CMSC), which manages the SCIC, and relevant ministries to review and issue policies to remove difficulties for the SCIC’s operations.

Deputy Minister of Finance Dang Hoang An said the SCIC should divest from enterprises which operated inefficiently.

According to SCIC Chairman Nguyen Duc Chi, most enterprises in SCIC’s portfolio operated in sectors heavily affected by the COVID-19 pandemic in terms of input shortages, disruptions to value chains and struggling sales, which were weighing on business.

In a report to the CMSC, the SCIC said that 81 out of 145 enterprises in its portfolio suffered from the pandemic in the first quarter of this year.

The Viet Nam National Garment and Textile Group was among those heavily affected, and forecasts a decline of 22 per cent in revenue and 79 per cent in profit compared to its plan. FPT Telecom also predicted a fall of 15 per cent in revenue and 20 per cent in profit.

Chi said that if the COVID-19 pandemic ended in the second quarter of this year, the SCIC’s revenue and profit would both be 18 per cent lower than targeted. If the pandemic stretched into the fourth quarter, the SCIC’s revenue would drop to just 50 per cent of the plan and profit to 16 per cent.

Still, the SCIC has not decided to adjust its business plans this year.

It targets a revenue of VND6.9 trillion (US$297.4 million) and a profit of VND4.8 trillion.

In 2020, SCIC plans to divest from 85 enterprises, 28 of which are traded on the national stock exchanges.

Fitch affirms 'BB' ratings on EVN, EVNNPT, PVN; revises outlooks to stable

Fitch Ratings has affirmed issuer default ratings and senior unsecured ratings of Vietnam Electricity (EVN), National Power Transmission Corporation (EVNNPT) and Vietnam Oil and Gas Group (PVN) at 'BB'.

However, the rating agency has revised the three companies' outlooks to stable from positive.

According to Fitch, EVN's ratings reflect its standalone credit profile (SCP), which is at the same level as the Viet Nam sovereign rating. Under Fitch's Government-related entities rating criteria (GERC), EVN's ratings will be equalised to that of the sovereign in case of any weakening in its SCP given the company's strong linkages with the state.

PVN's ratings are capped by those of the sovereign under Fitch's GERC given the company's strong linkages with the State. PVN's SCP is assessed at 'bb+'.

A factor that could, individually or collectively, lead to the upgrade of EVN and PVN is positive rating action on the sovereign, provided the likelihood of State support does not deteriorate significantly, Fitch said.

EVNNPT's ratings are based on the consolidated profile of EVN, which owns 100 per cent of EVNNPT, in line with Fitch's parent and subsidiary rating linkage criteria. The consolidated rating approach is driven by strong linkages between EVNNPT and its parent. EVNNPT's SCP is assessed at 'bb+'.

MoIT requests Hai Phong to create favourable conditions to transport goods

The Ministry of Industry and Trade (MoIT) on Monday requested Hai Phong City People's Committee to ensure smooth goods transport of trading enterprises and logistics services coming to and from the city while implementing the COVID-19 pandemic prevention activities.

The ministry said during the Prime Minister's Directive 16/CT-TTg on preventing and controlling the novel coronavirus (COVID-19) pandemic, Hai Phong City has been given urgent tasks, especially strengthening control of drivers of trucks coming to and from Hai Phong City.

However, the measures have caused difficulties for manufacturing, import-export and logistics enterprises in transporting goods to and from the Hai Phong Port, the largest port in the North of Viet Nam.

According to the Ministry of Industry and Trade, Hai Phong is a centrally-run city in a strategic location of the Northern key economic region, converging favourable factors for industrial production, trading and logistics.

The ministry has requested Hai Phong authority to create good conditions for transport goods as well as goods for production during the pandemic, aiming to boost exports and hit economic growth targets.

The ministry has also asked Hai Phong to review taxes and fees as well as reducing transport costs, including toll, parking fees and infrastructure fees. That is considered as an efficient support for the enterprises during the pandemic period.

The ministry has proposed Hai Phong raises any problems they face in implementing disease prevention that have affected trade.

At present, the ministry and other ministries and sectors have carried out measures to ease problems. This would help enterprises maintain their production and prepare all resource for resuming production growth after the pandemic.

At the same time, the ministry has been managing import and export activities in combination with the domestic market to ensure a stable supply for exports and domestic goods consumption. —

EVN power supply rises in first quarter

Electricity of Viet Nam’s production and import of power increased by 6.3 per cent year-on-year in the first quarter, ensuring safe and uninterrupted supply is available amid the COVID-19 pandemic.

A report by the State power distribution company showed that total power output was 57.29 billion kWh.

Domestic production was 49.28 billion kWh, a 6.47 per cent increase.

Renewable energy accounted for 2.76 billion kWh, including 2.31 billion kWh from solar energy, 28 times up from the same period of last year.

Ninety large-scale solar energy projects with the capacity of 4.500 MW were operated commercially last year.

Coal-fired thermal power accounted for 33.91 billion kWh, an increase of 21.3 per cent, and hydroelectricity for 8.93 billion kWh, a 30.4 per cent decrease.

The water flow to hydropower reservoirs across the country was low.

Large hydroelectric plants such as Hoa Binh, Ialy and Tri An are expected to be expanded in this year.

EVN is building 18 grids after completing 22 others in the first quarter with a capacity of 110-500kV. But the work faces difficulties due to several reasons including the COVID-19 pandemic.

EVN has asked customers to use online services when they want to register for electricity connections or make changes to prevent the spread of disease.

In March nearly 745,000 people used them.

EVN has urged the Ministry of Industry and Trade to subsidise power for all users by 10 per cent for the next three months.

The ministry has agreed and will soon announce whether the reduction will apply for April-June or May-July.

Vinachem asks to apply 0% tax rate to fertiliser products

The Viet Nam National Chemical Group (Vinachem) has sent a document to Viet Nam Fertiliser Association, asking the National Assembly to add fertiliser to the list of products subjected to value added tax (VAT).

The group suggested to impose a VAT rate of between 0 and 5 per cent.

Vinachem proposed to amend Law No. 71/2014 /QH13 on some articles of tax, which took effect on January 1, 2015.

That the law clarified fertiliser products are free from VAT, which also means that fertiliser firms can no longer deduct the VAT they paid for inputs.

Consequently, domestic fertiliser production costs increased. Therefore, businesses must increase the price of fertiliser, meaning the price cannot be reduced for farmers.

Increasing domestic fertiliser production costs is detrimental in terms of market competition with imported fertilisers, especially those imported from China, according to experts.

Vinachem said that subjecting fertiliser products to VAT is in compliance with current laws and international commitments on trade protection, ensuring a healthy and equal competitive environment and the interests of businesses and farmers and the country.

If fertiliser products are subjected to 0 per cent VAT, the products will be sold at a pre-tax price plus zero VAT, which means output VAT submitted to the State is zero.

Enterprises still received a VAT refund for inputs, which will reduce fertiliser production costs and allow the opportunity to reduce prices in the market.

If fertiliser is subjected to 5 per cent VAT, which is also output VAT paid by enterprises to the State, their input VAT will still be refunded.

"In both cases above, both domestically produced fertilisers and imported fertilisers are subject to the same VAT rate, creating an equality between domestic and imported ones," Vinachem said.

In its dispatch to the Viet Nam Fertiliser Association on the issue, Vinachem also emphasised that, in both cases above, the State did not have to spend money to support businesses during the Covid-19 pandemic, but only adjust policies so that the production and business activities of domestic fertiliser producers are equal to foreign ones.

South Korea, Viet Nam eye closer co-operation in supply chain

South Korea and Viet Nam could enhance their co-operation to help Viet Nam become the main link in the supply chains of South Korean businesses, especially in the automobile, electronics and garment and textile sectors.

Insiders made the statement at a video conference on Monday to share ideas on ways to expand economic ties despite the strain caused by the COVID-19 pandemic on global business activities.

South Korean Minister of Trade, Industry and Energy Sung Yun-mo and his Vietnamese counterpart Tran Tuan Anh discussed ways to expand bilateral ties amid the growing economic fallout from the pandemic.

The two sides plan to use regulations to allow businesses to immediately exploit the combined origin of textile materials under the EVFTA, to take advantage of high quality textile and apparel materials from South Korea, serving production and export of Vietnamese textile products to Europe.

In addition, Viet Nam and South Korea will also discuss food security, rice supply, fruit, vegetables and seafood trade amid the COVID-19 pandemic.

Anh asked South Korea to accelerate assessments for risk import licensing for Vietnamese red dragon fruits and grapefruit and support activities that distribute Vietnamese goods major South Korean firms like Lotte Mart, E-Mart, Home Plus and CJ Home Shoping.

During the meeting, the South Korean side thanked Viet Nam for enabling some of its residents to enter the country for major business activities amid the pandemic, emphasising that travel by business officials is crucial to maintain the global supply chain.

The two countries also agreed to push for a system which would allow them to process certificates of origin through electronic platforms.

The measure is expected to speed up customs procedures for exporters and prevent forgery of documents, according to the South Korean Ministry of Trade, Industry and Energy.

Viet Nam is the third-largest export destination for South Korea, whose outbound shipments to the Southeast Asian country hit US$48.1 billion in 2019, down 0.9 per cent from a year earlier.

In 2019, South Korea’s overall exports sank more than 10 per cent.

The country’s outbound shipments edged down 0.2 per cent year-on-year last month and plunged up to 18.6 per cent annually to $12.2 billion in the April 1-10 period, according to the data from the Korea Customs Service.

The figure is expected to continue dropping due to the pandemic, said experts.

Investment in HCM City export processing, industrial zones up 86%

Export processing and industrial zones in HCM City saw US$117 million of investment poured into the zones in the first quarter, a 86 per cent increase compared to the same period last year, according to the HCM City Export Processing and Industrial Zones Authority.

FDI in the zones was nearly $66 million, a 2.58 per cent increase year-on-year.

Eleven FDI projects registered more capital of over $60 million. There were six new projects with total capital of $5.48 million, a 74 per cent decrease from last year.

The zones received VND1.1 trillion ($47 million) worth of domestic investment, up by 37 per cent year-on-year. There were 13 new projects, while 12 projects increased their capital.

The increase in investment in the zones was mainly from domestic sources and foreign projects that already had plans to register more capital, according to the authority, which said that investment attraction in the second quarter may face challenges due to the COVID-19 pandemic

HCM CITY, as of March 20, had attracted over US$1 billion worth of FDI, a 33 per cent drop year-on-year, according to the HCM City Statistics Office.

Most factories in Cambodia operate as usual during traditional new year

Up to 95 percent of the Cambodian factories are operating as usual during the traditional New Year period in an effort to curb the spread of the COVID-19, according to officials.

Most factory workers have not taken leave for going to their home provinces on the holiday and only 5 percent of the workers are taking emergency leave, said Cambodia’s Labour Ministry spokesman Heng Sour on April 13

The Cambodian government has also called for urgent actions on food security. Minister of Agriculture Veng Sakhon has ordered all agriculture departments to take immediate measures to ensure the country’s food security.

Sakhon told the General Directorate of Agriculture to record the stock of paddy and rice in mills, communities and in each household and asked the General Directorate of Animal Health and Production to make an estimate on the amount of local demand for meat in 2020.

The purpose is to provide a foundation for raising livestock levels to ensure adequate supplies of meat during the pandemic.

In addition, he instructed the Fisheries Administration to estimate the demand and supply of aquatic products to ensure that they fulfill domestic demand and the market price is stable.

Meanwhile, Brunei reported no new COVID-19 cases on April 13, and the country's tally stood at 136 since the first one was detected on March 9. As many as 107 patients have recovered.

However, seven recovered patients who had been discharged from the National Isolation Centre (NIC) were found to be positive with the virus again.

All of the patients have been re-admitted to the NIC. People having close contact with them were required to carry out laboratory tests and undergo 14-day quarantine./.

Soaring air freight costs, shipping cancellations upset global supply chains: insiders

Soaring air freight rates and rising cancellations of trips by cargo ships due to the COVID-19 pandemic have put further pressure on global supply chains. according to insiders.

Most of the airlines around the world have cut their operation by 90 percent, significantly reducing global freight capacity. Freight rates are rising daily because demand is far beyond capacity, President of the Singapore Aircargo Agents Association (SAAA@Singapore) Steven JK Lee said.

Vincent Phang, CEO of Singpost, the country’s postal service provider, said it has been suffering from suspensions and delays in mail and freight deliveries to and from many countries. It has also incurred growing air freight costs because there are only a few flights each day. Rates for VIP customers are now two or three times higher, while those for ordinary customers have gone up six to ten-fold.

The situation has become even worse as more and more shipping lines have cancelled or halted trips without notice.

Raymon Krishnan, President of the Logistics and Supply Chain Management Society of Singapore, said it’s not just about the number of trips but also how they are being cancelled or halted.

Shipping lines used to provide notice about cancellations three to four weeks in advance, but as COVID-19 has spread globally, cancellations or suspensions are effective almost immediately./.

Thailand’s arms purchase plans get the chop

Thailand’s Prime Minister Prayut Chan-o-cha, who also serves as Defence Minister, has ordered the suspension of a plan by the armed forces to procure arms, including the Royal Thai Navy's plan to buy two submarines, according to a government source.

The source said Deputy Defence Minister Gen Chaichan Changmongkol met PM Prayut to discuss a proposal to cut the military budget by 10 percent so that the money could instead be used to support the government's efforts to combat the COVID-19 pandemic.

PM Prayut has instructed the Defence Ministry to halt all arms procurement projects, including the navy's plan to buy its second and third submarines, as well as the air force's plan to upgrade its fleet of aircraft and buy new training aircraft.
According to Prayuth Phetchakhun, deputy spokesman of the Office of the Attorney-General (OAG), 5,264 people have been prosecuted for violating the emergency decree, imposed from March 26 to April 30 contain the spread of COVID-19.

When bringing the cases to court, the prosecutors will ask for additional measures to keep the offenders safe, Prayuth said, adding that if the defendant violates the stay-at-home order, he faces a maximum jail term of six months and/or a maximum fine of 10,000 THB.

The PM slammed the curfew violators for lacking a social conscience but insisted he will not impose any tougher restrictions as current measures in dealing with the pandemic over the past 100 days are proving effective.

Thailand now has the number of infected patients at a controllable level, and a low death rate compared to other leading countries, he said./.

Binh Duong province’s exports grow by 3.6 percent in Q1

Despite the difficulties caused by the COVID-19 pandemic, Binh Duong province managed to expand exports by 3.6 percent in the first quarter of the year to 5.8 billion USD, according to its Department of Industry and Trade.

Key export items like textiles, footwear, wood products, and computers and electronic products saw increases of between 3 percent and 4 percent year-on-year, lower than last year but impressive amid the pandemic.

The province’s imports were estimated at 4.2 billion USD, a year-on-year increase of 4.3 percent, giving it a trade surplus of 1.6 billion USD.

The department said the pandemic has been negatively affecting industrial production and trade around the country, including Binh Duong.

The drastic support measures implemented by the Government and the province enabled trade to remain robust.

Ho Van Binh, the department’s Deputy Director, said a survey done by his department found that most enterprises in the province have faced difficulties in production and trading due to the pandemic, including 110 import-export firms.

In the case of some other enterprises, trade was not affected in the first quarter, but with the pandemic spreading to most major markets such as the US, EU, the Republic of Korea, and Japan, it is likely to be affected in the second quarter, he warned.

According to business groups, leather and footwear and garment and textile enterprises are facing difficulties with export orders falling by 50 – 60 percent.

To retain their workers and sustaining cash flows, they are shifting production to target the domestic market.

Trade activities would face new difficulties in the second quarter from the global COVID-19 outbreak, and the province has taken many measures to enable businesses to access funds and markets and eased tax payment deadlines, the department said.

Chairman of the provincial People's Committee Tran Thanh Liem said with the Government and province’s efforts to support enterprises and address their difficulties, especially with regard to finance, banking, tax, and administrative procedure reform, he expects the business community to overcome the difficulties and enjoy good growth this year./.

 
 

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