Q2 growth likely to suffer from pandemic
Vietnam’s economic growth in the second quarter is almost certain to be down against the first quarter as the COVID-19 pandemic impacts the world, experts have said.
The Ministry of Planning and Investment said the pandemic is developing in an unpredictable manner, making it difficult to determine when its peak and end will occur.
The ministry noted the outbreak has seriously affected all elements of socio-economic development. Businesses are now facing the risk of material shortages and may be forced to suspend operations, while inflationary pressure is mounting and rising unemployment may impact on social security.
Vietnam’s GDP growth in the first quarter was already the slowest for a decade, at 3.82 percent, according to the General Statistics Office.
Experts from the Hanoi-based National Economics University (NEU) recently forecast year-on-year growth in Q2 of around 2 percent or even lower if the pandemic worsens.
Exports may decline by some 25 percent in the quarter and 15 percent in subsequent quarters, they added, with economic recovery expected to begin in Q3 at the earliest.
The NEU experts also noted that these figures are only rough estimates at this stage.
They believe Vietnam’s economy may encounter even more difficulties in the months to come, throwing into question domestic businesses’ capacity to absorb the credit package of 285 trillion VND (12.16 billion USD) and the influence of a downturn in global trade and production on household consumption and enterprise investment.
They also pointed to a downward trend in FDI inflows, as COVID-19 has made many foreign enterprises reluctant to raise investment capital. Low credit demand, meanwhile, is projected to remain throughout Q2.
Economic expert Nguyen Tri Hieu said that, unlike in Q1, the entire economy will be affected by the pandemic in Q2. Both supply and demand in all sectors, from tourism, aviation, and consumption to exports and imports will be strongly impacted.
“As we have just entered Q2, however, and the pandemic remains unpredictable, it’s still too early to forecast quarterly GDP,” he said./.
Savills Vietnam optimistic about real estate investment amid COVID-19
Property consultants Savills Vietnam have adopted a positive outlook on real estate investment in Vietnam amid the COVID-19 pandemic, saying that when it eases there will be increasing numbers of investors injecting new capital into the sector.
According to its most recent report, residential real estate is experiencing a short-term negative impact as travel bans are preventing buyers from visiting and closing deals, especially given that China, the Republic of Korea, and Japan account for a large proportion of foreign demand.
Developers, however, have prepared strong project pipelines in order to be ready when local and foreign demand return to previous levels, as Vietnam still has among the lowest real estate prices but highest rental yields in the region.
In January, the Mitsubishi Corporation and the Nomura Real Estate Co., Ltd. acquired up to 80 percent in the second phase of the Grand Park Project in HCM City, which sits on 26 hectares and has more than 10,000 apartments.
This is a difficult period for local and international property investors, according to Dr. Su Ngoc Khuong, Senior Director of Savills Vietnam. In his opinion, for cash-rich investors with experience in the sector, however, it is also a time of great opportunity in Vietnam and overseas as those that have over-extended undertake rapid divestment.
He noted that one trend on the rise since last year is investor groups seeking to partner with others to develop larger-scale M&A opportunities. There are deals of this nature in Vietnam currently under negotiation and valued at well over half a billion dollars in total, Khuong added.
A variety of government incentives have been put in place in response to the challenges posed by the outbreak, including tax breaks and the suspension of tax payments and land rentals for businesses hurt by the COVID-19.
A credit package of 250 trillion VND (10.6 billion USD) and supportive measures such as rescheduling and reducing interest rates, maintaining current loan classifications, and reducing fees, among others, will also be offered to enterprises facing difficulties due to the outbreak.
In order to support enterprises and improve the business environment, the Government has also asked relevant authorities to review and reduce administrative procedures and speed up the disbursement of investment capital.
The latest robust Government directives are being implemented to support property and business throughout this period of slowdown. “With increased liquidity and a potentially rich investment environment, we anticipate that when the pandemic eases, more and more investors will pour new capital into Vietnam’s real estate sector,” Khuong said./.
Regulation on coordination in settling int’l investment disputes issued
Prime Minister Nguyen Xuan Phuc has signed Decision No. 14/2020/QD-TTg promulgating the Regulation on coordination in the resolution of international investment disputes.
The Regulation prescribes the principles, tasks, power and process of coordination among state agencies, organisations and individuals concerned in settling international investment disputes through international arbitration or at other tribunals outside Vietnam.
It does not apply to the settlement of investment complaints at arbitration centres, courts, agencies and organisations of Vietnam according to Vietnam’s law.
Regarding the principles of coordination, the leadership agency, the legal representative agency of the Government, and relevant agencies, organisations and individuals are responsible for promoting full, effective and timely coordination in handling international investment disputes pursuant to the provisions of the Regulation and the Vietnamese law to optimally protect the lawful rights and interests of the Government and state agencies of Vietnam.
The leadership agency, the legal representative agency of the Government, and relevant agencies, organisations and individuals are also obliged to keep State secrets and conceal the information and documents obtained during the process of dispute settlement, in accordance with the provisions in international arbitral proceedings and the provisions of Vietnam’s law.
The leadership agency, the legal representative of the Government, and relevant agencies, organisations and individuals must take responsibility before the law for the consequences incurred by their failure to coordinate in line with the aforementioned principles.
The Regulation specifies the contents of coordination, including the exchange of information and documents among relevant agencies in the process of settling foreign investors’ complaints, denunciations and problems in order to prevent international investment disputes.
In addition, the agencies concerned coordinate in the resolution of international investment disputes through appointing their competent persons to join the intersectoral working group on dispute settlement at the request of the leadership agency, as well as to participate in negotiating and mediating international investment disputes, designing and implementing the strategy and roadmap for dispute handling, and collecting and providing information, records, evidences and documents serving the settlement of international investment disputes.
These authorised individuals are also in charge of dealing with contents related to judgments and decisions by international arbitrators, and performing other affairs in the resolution of international investment disputes.
Motorcycle sales decrease in first quarter
The five members of the Vietnam Association of Motorcycle Manufacturers (VAMM) sold 731,077 vehicles in the first quarter of 2020, down 3.03 percent year on year.
That means the VAMM members, namely Honda, Piaggio, Suzuki, SYM and Yamaha, delivered nearly 244,000 units to customers every month, data of the association show.
These producers are currently supplying about 100 models to the market, from domestically assembled to imported vehicles, with prices ranging from 18 million VND to 1.2 billion VND (771 – 51,400 USD) per unit.
However, insiders said the actual motorcycle sales in the country are much higher than the released figure since apart from the VAMM members, there are more brands in the Vietnamese motorcycle market such as Kymco, Ducati, Kawasaki, BMW, KTM, Benelli and Harley Davidson.
Meanwhile, VinFast, Pega and Yadea are also manufacturing, assembling and distributing electric scooters in the market, but they are not members of the VAMM and haven’t revealed their sales.
Experts already forecast the fall in motorcycle sales triggered by market saturation, and the downward trend began several years ago. The sales declined 2.5 percent year on year in 2018, 4 percent in 2019 and 3.03 percent in Q1 of this year.
Besides, the improved living standards and decreasing car prices have encouraged many people to choose automobiles instead of motorcycles./.
Singapore to spend 6.3 billion USD on supporting families, businesses
About 9 billion SDG (6.3 billion USD) in support will be rolled out to families and businesses in Singapore in April as part of measures to help them overcome difficulties amid the COVID-19 pandemic, said Singaporean Deputy Prime Minister cum Finance Minister Heng Swee Keat.
Accordingly, 90 percent of Singaporean adults will receive a one-off payout of 600 SGD (422 USD) on April 14 through their bank accounts.
The rest can provide the Government with their bank details and get the money by April 28, or receive by cheque from April 30 onward.
Heng also noted that all Singaporean firms will get 75 percent of the first 4,600 SGD (3,247 USD) of each local worker's monthly wages subsidised by the Government for April, under the Jobs Support Scheme of the country.
The government is also looking at "various indicators" to see how much more might be needed from the country’s reserves to help Singapore meet the fallout from the pandemic, he added.
He urged businesses and Singaporeans to focus on how to make the best use of the amounts already allocated to ride through this difficult period.
Singapore has announced three financial support packages totaling 59.9 billion SGD (42.1 billion USD) in just less than two months to cope with the pandemic.
Meanwhile, the Health Ministry of Cambodia on April 13 morning confirmed two more cases of COVID-19, raising the total to 122./.
Thailand to adjust 20-year national strategy
The National Economic and Social Development Council (NESDC) of Thailand has been ordered to revise the 20-year national strategy (2018-2037) and the 12th national economic and social development plan (2017-2021) to catch up with changing social and economic trends caused by the global economic slowdown and the COVID-19 pandemic.
At the latest meeting of the National Strategy Committee, Prime Minister Prayut Chan-o-cha requested the NESDC to revise the master plan for the first five years (2019-2023) under the 20-year national development strategy.
The national strategy, which came into force on October 13, 2018, has 23 master plans. Under those plans, there are 15 urgent flagship projects that must be implemented during 2019-23.
The first five years (2019-23) of development are based on requirements set under the national strategic plan. Gross national income per capita is targeted to increase by an average of 70,000 (2,100 USD) baht a year to reach 360,000 baht (10,100 USD) in 2023, up from 290,000 baht in 2019.
Growth in agriculture, industry and services is targeted at 3.8 percent, 4.6 percent and 5.4 percent, respectively, in the 12th national plan.
NESDC Secretary-General Thosaporn Sirisamphand said the council is scheduled to propose a revised plan by September.
Danucha Pichayanan, NESDC deputy secretary-general, said the 20-year strategic plan already took into account the possible impact of new diseases such as Severe Acute Respiratory Syndrome (SARS) and Middle East Respiratory Syndrome (MERS).
However, the impact of the COVID-19 is deeper and projected to last a long time, causing problems much more complicated than those of SARS and MERS, he stated.
COVID-19 also struck while the global economy was already slowing down. Therefore, rehabilitating the economy may take a while, and some business sectors may encounter more difficulty resuming their previous healthy growth, especially automotive, aviation and tourism, he added./.
COVID-19: Coal industry helps Quang Ninh maintain economic growth
The coal industry is considered a bright spot in helping the northern province of Quang Ninh maintain its economic growth in 2020 despite the impact of the COVID-19 pandemic, according to the provincial People’s Committee.
A report released by the Vietnam National Coal - Mineral Industries Holding Corporation Limited (Vinacomin) revealed that its subsidiaries churned out a total 10.4 million tonnes of raw coal in the first quarter of the year, equivalent to 25.7 percent of the annual target.
It sold 11.63 million tonnes in the quarter, earning an estimated 30.2 trillion VND (1.29 billion USD).
In order to achieve the “dual goals” of preventing and controlling the COVID-19 outbreak and realising its growth goal of 12 percent this year, local authorities have directed all departments and sectors to quickly remove all difficulties facing the coal industry, so it may strengthen operations and production.
The local authorities have also focused on accelerating site clearance for Khe Cham coal sorting, Mong Duong mine, and Bang Nau dump projects, while working with the Ministry of Natural Resources and Environment in seeking the Prime Minister’s approval for a number of coal mines, to expand exploitation.
Quang Ninh has also sped up its economic restructuring, in which the manufacturing and processing industry is given a major focus.
It has worked on quickly removing difficulties facing local enterprises and accelerating the implementation of key investment projects, so that a number of processing and manufacturing factories can go into operation.
The province posted growth of 7.2 percent in the first quarter, and State budget contributions totalled 211 billion VND (9 million USD). Tourism revenue and export turnover, meanwhile, fell 1.81 trillion VND (77.6 million USD) and 80.5 million USD, respectively./.
Ministry launches investigation into anti-dumping duties on polyester yarn
The Ministry of Industry and Trade (MoIT) has launched an investigation that may result in anti-dumping duties on polyester filament yarn (PFY) originating from China, India, Indonesia and Malaysia.
The investigation was launched after a request from the domestic manufacturing industry.
The request, which was submitted on November 7 last year, said that PFY imports from the above-mentioned countries had surged, causing significant damage to the local PFY manufacturing industry.
Fabrics used in the apparel industry are mainly made up of three types of yarn including PFY yarn, polyester staple fibre (PSF) and natural fibre (mainly cotton). PFY accounts for around 30 per cent of total consumption. The designed capacity of PFY production factories in the country is estimated at 350,000 tonnes per year.
During the investigation, the ministry will assess the socio-economic impacts to ensure the legitimate rights and interests of importers, consumers and domestic PFY manufacturers.
The MoIT will send questionnaires to relevant parties for analysing the anti-dumping level and damages. Relevant parties can also exchange information with the ministry before the final decision is released.
Under the provisions of the Law on Foreign Trade Management, the ministry can apply provisional anti-dumping measures. In addition, anti-dumping duties may be imposed within 90 days prior to the imposition of provisional anti-dumping duties.
Sustainable development a key trend for tourism
The recently-issued strategy for Vietnam’s tourism development to 2030 is expected to be a driving force for the industry in weathering the storm posed by the COVID-19 pandemic, according to the Cong Thuong (Industry & Trade) newspaper.
Approved by Prime Minister Nguyen Xuan Phuc, the strategy aims to develop tourism into a spearhead economic sector with sustainable development that creates momentum for other sectors.
Under the strategy, Vietnam is to become one of the top 30 countries in terms of tourism competitiveness by 2030. It hopes to attract at least 50 million foreign visitors and 160 million domestic travelers each year, earn 3.1-3.2 trillion VND (130-135 billion USD) in revenue, and post annual tourism growth of 11-12 percent over the next decade.
The global COVID-19 pandemic has taken a toll on multiple sectors, with tourism among the hardest-hit.
Some experts, however, believe the new strategy, which features clear targets and support policies, will be a driving force and provide the opportunity for Vietnam’s tourism industry to overcome the impacts of the outbreak.
The Cong Thuong newspaper said the directions towards tourism growth set out in the strategy match the current trend of sustainable development, as it specifies synchronous and drastic solutions, including improving awareness among people and businesses about ensuring visitors have a good impression of the country, developing tourism infrastructure and human resources, diversifying markets and products, boosting tourism promotions, and building brands.
Such solutions also focus on creating an optimal business environment, assisting small and medium-sized enterprises and households providing tourism services to acquire digital skills and access to financial sources, facilitating visa granting, developing large-scale and world-standard tourism complexes, and helping people engage in community-based tourism.
Foreign arrivals to Vietnam plunged 63.8 percent in March against February and 68.1 percent year-on-year. The first quarter total stood at around 3.7 million, down 18.1 percent from the same period last year, according to the General Statistics Office.
Meanwhile, the World Tourism Organisation has projected that the number of foreign tourists globally will fall by 1-3 percent this year rather than grow 3-4 percent as forecast in January just prior to the outbreak./.
COVID-19 causes coffee prices to tumble to record 10-year low
The first quarter of the year saw the country export 474,000 tonnes of coffee worth US$801 million, a year-on-year decline of 3% in volume and 5.6% in value, according to figures released by the Agro Processing and Market Development Authority (Agrotrade) under the Ministry of Agriculture and Rural Development.
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Among the largest consumers of the Vietnamese coffee, Germany, the United States, and Italy lead the way with the average export price throughout the reviewed period dropping by 2.8% to $1,692 per tonne on-year.
The Agrotrade notes that March saw the domestic coffee market experience wild fluctuations in terms of price, matching the trends seen in the global market. Evidence for this can be seen in the price of Robusta coffee from provinces in the Central Highlands which endured a fall of up to VND800 per kilo to approximately VND30,700 per kilo compared to February.
Elsewhere, the domestic price of Robusta coffee plummeted to a record 10-year low, causing enterprises to face a shortage of supply sources for export as coffee growers began to limit sales in order to bring the price under control.
The price of coffee is not expected to immediately recover as import and export activities have been suspended due to the increasingly complicated developments relating to the novel coronavirus (COVID-19) which has forced many freight forwarding ports to close, according to insiders.
Moreover, there has been lower levels of coffee consumption with firms lacking purchasing power as a result of the COVID-19. This is especially true due to the imposition of trade restrictions by major markets such as the EU and the US, which has caused heavy losses for the coffee industry, especially growers.
Businesses advised to outline long-term vision for CPTPP benefit
Local firms must outline a long-term vision and implement institutional reforms in order to maximise the benefits presented by the Comprehensive and Progressive Agreement for Trans- Pacific Partnership (CPTPP), according to insiders.
Experts believe that there remains plenty of room for local textile, footwear, and beverage industries to boost their exports among other CPTPP members with Vietnamese firms operating in these sectors able to develop production by strengthening institutional reforms through the trade pact.
Aside from promoting exports, local enterprises are expected to enjoy opportunities to import raw materials, machinery, and equipment from other CPTPP members at a reasonable cost whilst also gaining access to high-quality logistics production and telecommunications services.
At present, the novel coronavirus epidemic has slowed global trade with several countries moving to impose travel restrictions which are hindering the country’s import-export prospects.
However, taking advantage of the incentives given by free trade agreements like the CPTPP is expected to accelerate domestic production and export figures over the long term.
According to the World Bank, Vietnam’s exports to other CPTPP countries by 2030 is predicted to increase from US$54 billion to US$80 billion, accounting for 25% of the country’s total export turnover.
Most notably, the market share of export turnover for the footwear, textile, wooden, and beverage industries stands at 12.5%, 16.04%, 20%, and 23.46%, respectively.
Nguyen Anh Duong, Head of the Macroeconomic Policy Department under the Central Institute for Economic Management, says businesses have so far only paid attention to short-term issues such as taxes and tax reduction. Indeed, many have failed to gain an insight into the rule of origin, Sanitary and Phytosanitary measures, technical barriers to trade, and lack information regarding the networks of domestic and foreign suppliers.
As a means of utilising the benefits of the CPTPP, firms must tackle challenges and improve competitiveness in the implementation of the CPTPP, Duong emphasises.
Vo Tri Thanh, Director of the Research Institute for Brand and Competitiveness Strategy, notes that aside from efforts by local enterprises, the government should focus on improving the legal framework in line with commitments, serving to meet new trends. This can ensure that the economy develops in a sustainable manner and speeds up institutional reforms to remove hurdles that businesses face, especially small and medium-sized enterprises.
VietGAP quality mango fetches high incomes for farmers in Mekong Delta commune
The cultivation of Hòa Lộc mango to Vietnamese good agricultural practices (VietGAP) standards provides steady outlets and incomes for farmers in Thổ Sơn Commune in Kiên Giang Province.
The commune in Hòn Đất District is the largest mango producer in the Cửu Long (Mekong) Delta province, with its weather and soil especially suitable for growing mangoes, especially the specialty Hòa Lộc variety.
It has set up the Hòn Đất Hòa Lộc Mango Co-operative to promote the cultivation of VietGAP quality mangoes and link up with companies to secure outlets.
Nguyễn Thành Đô is a member of the co-operative and has been growing VietGAP quality mangoes in the commune’s Hòn Me Hamlet in recent years.
The cultivation and post-harvest processes take time and labour but ensure quality and high prices, he said.
Farmers who grow VietGAP-quality mangoes strictly follow standards laid down for fertiliser and chemical use and cover unripe fruits with plastic bags to protect them from pests.
After harvest, the mangoes are classified and labelled with a QR code for origin tracing. Consumers can know the growing process and place and contact address by scanning the code.
VietGAP quality Hòa Lộc mango cultivation offers them an income of VNĐ300 million (US$12,800) per hectare a year, according to co-operative members.
Nguyễn Thành Thái, director of the co-operative, said members harvest the fruits twice a year, each time getting a yield of four tonnes per hectare.
The fruits fetch steady prices since they are preferred by consumers for their high quality, he said.
The co-operative sells to clean agricultural produce shops in Rạch Giá City and Phú Quốc District and An Hữu Market in Tiền Giang Province’s Cái Bè District.
Trần Xuân Nghi, chairman of the Hòn Đất District Farmers Association, said the association had asked the province Department of Science and Industry for support to create a collective brand name for Hòn Đất Hòa Lộc Mango.
This would help promote the market and improve the value of the fruit, he said.
Thổ Sơn grows more than 360ha of various varieties of mangoes.
The commune has determined that mango, rice and shrimp are its three agricultural products with high development potential.
Many farmers in the commune with unproductive rice fields and growing fruits and other crops are switching to Hòa Lộc and other mango varieties, according to the local People’s Committee.
Nguyễn Văn Đức of Hòn Me Hamlet got a soft loan to grow Hòa Lộc mango trees in his orchard, and has earned high incomes. After the success of the first harvests, he planted more trees, he said.
Farmers in the commune have adopted advanced farming techniques to grow mangoes in the off-season to earn higher prices, especially during festivals like Tết (Lunar New Year).
Agricultural land price increases during COVID-19
While most of the realty segment has struggled during the COVID-19 pandemic, agricultural land is still a hot investment as more people want to return to rural areas for a more environmentally-friendly life.
According to land brokers, the prices of agriculture land have doubled and tripled in Vietnam’s southern provinces, as many buyers leave the city for the countryside.
The trend encouraging people to move from the city to the outskirts started more than a year ago and increased due to the pandemic. Social distancing measures have urged more people to look for gardens and agricultural land instead of being locked down in a crowded city.
“The trend is making land prices rise,” said land broker Nguyen Tung Lam.
According to Lam, who mostly works in Da Lat city in the Central Highlands province of Lam Dong, each plot of 1,000 sq.m of agriculture land cost 400-700 million VND (17,000 to 30,000 USD) last year. Now the price of a plot could reach between 3 billion VND and 6 billion VND.
Agriculture land prices have also soared in the Mekong Delta, in areas such as Long An, Tien Giang and Dong Thap.
In Cai Lay district, Tien Giang province, the price of agriculture land ranges from 400 million VND to more than 1 billion VND per plot. They were about 200-230 million VND last year.
Similarly, agricultural land plots around Ho Chi Minh City, such as the province of Dong Nai, are reported to reach 2-2.5 billion VND per plot.
Nguyen Thu Nga, a land broker in HCM City, told local media that: “The demand has grown well since last year. Though there are fewer clients coming to see the land, they ask the brokers to check carefully for a purchase after the pandemic.”
Most investors in agricultural land see gains from their investment.
Nguyen Thu Hue, a member of the Facebook Group ‘Leaving the city to the countryside’, with more than 2,500 members, said: “I can sell the land I bought at a price three times higher, but I want to keep it.”
Hue believed that the prices would increase more after the pandemic.
Tran Khanh Quang, Director of Viet An Hoa Realty Company, said that since the end of 2019, some investors have tended to put aside 5 to 10 percent of their budget to buy agriculture plots or small farms in HCM City’s neighbouring provinces as a safe investment.
As concern over the pandemic grows, the trend of returning to rural areas is getting more and more attention. As a result, he said it made the prices of agriculture land rise on the market./.
Vietnam eyes GDP growth of 7 percent in next five years
Prime Minister Nguyen Xuan Phuc has issued Directive No. 118/CT-TTg on building a socio-economic development plan for the 2021-25 period.
Ministries, sectors and localities nationwide have been asked to determine core issues for the next five years, especially the target to obtain GDP growth of about 7 percent in the period.
The PM noted that in the next five years, the national economy will face various difficulties and challenges stemming from current drawbacks, as well as social and environmental problems such as an aging population, the income gap, diseases and natural disasters, among others.
He added that the plan must be considered in line with complicated and unpredictable situations and fierce global competition.
Furthermore, the global economy is forecast to slow due to complexities caused by the COVID-19 pandemic./.
US returns another 300 million USD stolen from 1MDB fund to Malaysia
The US Department of Justice (DoJ) on April 14 said it has repatriated another 300 million USD recovered from asset seizures linked to the 1Malaysia Development Berhad (1MDB) to the Southeast Asian nation.
The amount is part of more than 4.5 billion USD that US investigators said that has been "embezzled" from the 1MDB fund under the governance of former Malaysian Prime Minister Najib Razak.
Along with other amounts returned to Malaysia a year ago, the US has so far helped Malaysia recover more than 1 billion USD lost in the corruption scandal.
Najib founded the 1MDB investment fund in 2009, supposedly to serve Malaysia’s development through global partnerships and foreign direct investment.
Malaysian and US investigators believe that the fund has looted about 4.5 billion USD, about 1 billion USD of which was sent to the Najib’s personal bank account.
The allegations contributed to Nazib’s shock election loss in 2018 and he has since been put on trial over the scandal. At least six countries are investigating the scandal.
Last September, the DoJ reached a deal with Malaysian financier Jho Low to retake almost 1 billion USD in funds Low and his family had misappropriated from the 1MDB./.
Wood industry tries to survive during COVID-19
Amid an array of difficulties caused by the COVID-19 pandemic, the wood industry is exerting every effort to maintain business and production, while implementing initiatives and defining strategic lines of products and markets.
A survey of 124 wood processing enterprises on the impacts of the disease found that the sector’s export turnover and growth are likely to drop sharply in the near future.
Up to 76 percent of enterprises said that the sector is likely to suffer total initial losses of 3.06 trillion VND (131 million USD), while the remaining said they have not yet determined the level of losses.
Only 7 percent of the respondents said they are maintaining operations as normal. Meanwhile, 51 percent reported that they had scaled down production, and 35 percent said they will have to suspend operations in the coming time.
According to Chairman of the Vietnam Timber and Forest Product Association (VIFORES) Do Xuan Lap, while most wood firms had to narrow their production scale, some are still maintaining production thanks to stable lines of products in key markets.
To Xuan Phuc, an expert from Forest Trends, commented that although the pandemic will end, but the operation of the wood industry cannot go back to normal.
The sector should change the identification of strategic lines of products and markets to ensure sustainable development as well as promote links among businesses and develop the supporting industry, he suggested.
Vietnam's export value of wood and wooden products reached 2.7 billion USD in the first quarter of 2020, representing a year-on-year increase of over 16 percent, according to the Ministry of Agriculture and Rural Development./.
Tien Giang’s fruit export turnover up 20.3 percent in Q1
The Mekong Delta province of Tien Giang exported 1,920 tonnes of fruits in the first quarter of 2020, raking in 3.9 million USD, representing year-on-year increases of 12.6 percent and 20.3 percent, respectively.
Besides China, Tien Giang’s raw and processed fruit products are also shipped to markets such as Europe, the US, Japan and the Republic of Korea.
Many challenges, however, face the province’s fruit industry, as the COVID-19 pandemic is hampering demand.
The provincial People’s Committee has instructed departments and districts to work with businesses on solutions to facilitate produce purchasing and exporting.
Businesses and organisations such as the Big C supermarket chain and My Tinh An Commune Dragon Fruit Cooperative have taken part in the province’s programme to increase fruit purchases.
The province is focusing on hi-tech applications, smart agriculture, and improvement of its network of 130 agriculture co-operative groups to foster sustainable value chains.
Tien Giang is a key agricultural production province in the Mekong Delta. It has over 79,000 hectares of land for growing numerous kinds of fruit, producing over 1.49 million tonnes of fruit annually.
Many of its fruits have received certificates of geographical indication and are favoured by domestic and foreign customers.
Last year, Tien Giang earned 37.6 million USD from exporting 21,000 tonnes of fruits./.
WB: Cambodia’s economic pillars unstable due to COVID-19
The World Bank (WB) warned on April 14 that the slow growth of Cambodia’s construction and real-estate sector, considered one of the country’s economic pillars, could negatively affect the country’s overall growth.
Along with other factors such as the COVID-19 pandemic and a sharp decrease in the number of tourist arrivals, a decline in the property sector’s growth amid difficulties in the financial market and an increasing dependence on China’s investment in the construction and real-estate sector have contributed to slowing down Cambodia’s economic growth.
The WB recommended Cambodia to carry out micro-economic measures carefully, such as restricting construction loans and investment in real estate, and tightening lending interest rates and values of loans, except for those who buy houses for the first time.
Regarding the garment and textile sector, which has been one of the main driving forces of the Cambodian economy for many years, the European Branded Clothing Alliance (EBCA) has submitted a petition to the European Union (EU) to postpone the withdrawal of the Everything but Arms (EBA) trade preference scheme for Cambodia.
On February 12, the European Commission (EC) announced to revoke part of the EBA scheme for Cambodia. The EC’s decision will become effective on August 12 and directly affect such products as clothes, footwear and sugar, which are worth around 1.1 billion EUR (1.2 billion USD), equivalent to 20 percent of Cambodia’s export turnover to the EU.
The Garment Manufacturers’ Association in Cambodia (GMAC) said that about 60 percent of the country’s factories are hit hard by the COVID-19 pandemic as their export contracts are cancelled. The pandemic has also affected 74 percent of labourers (around 750,000 people) working in the industry./.
US firms interested in Vietnam’s plans to resume production, business
Vietnamese Ambassador to the US Ha Kim Ngoc had an online meeting on April 14 with Chairman of the Business Council for International Understanding (BCIU) Peter Tichansky and senior officials of 40 major US enterprises to discuss bilaterial cooperation and investment opportunities.
It is a regular exchange between the Vietnamese embassy and BCIU members, but this is the first time it was held online to ensure social distancing amid the COVID-19 outbreak.
Speaking at the meeting, Ngoc said that despite challenges caused by the pandemic, the Vietnam-US relations have been promoted and they have achieved positive results in numerous fields.
In economics and trade, the two countries have boosted consultations to maintain their development pace, he stated, adding that the Vietnamese Government is taking measures to intensify bilateral trade in a harmonious and sustainable manner.
Notably, healthcare cooperation has become a bright spot in their bilateral relations with Vietnam currently producing protective gear and medical equipment for the US.
On April 1, Vietnam, as the ASEAN Chair in 2020, co-chaired a teleconference of senior officials of ASEAN and the US on COVID-19 response, Ngoc noted.
Updating the participants on Vietnam’s pandemic prevention and control efforts, the diplomat said the Vietnamese Government is doing its utmost to control the disease, boost economic development and ensure social welfare with an aim that nobody is left behind.
Representatives of US businesses spoke highly of Vietnam’s achievements in the COVID-19 fight as well as its efforts to promote international cooperation in this area.
Sean Mulvaney, representing P&G Group, affirmed strong support for the Vietnamese Government’s drastic actions and its equal approach between disease prevention and economic development.
US enterprises showed their interest in Vietnam’s plans to resume business and production activities, and raised questions related to the fields the country is giving priority to.
Ambassador Ngoc expressed his hope that BCIU members will continue supporting Vietnam’s pandemic prevention and control efforts, and expand their investment and business in Vietnam in the time ahead, especially in energy, infrastructure, technology and the digital economy.
He asked major groups such as Medtronic, Gilead and Bayer to step up collaboration with Vietnam to produce medical equipment, and share information on research and testing of vaccines and medicines./.
PM orders enhanced management of food safety
The People’s Committees of Hanoi, HCM City and other big cities have been instructed to pilot higher standards and technical regulations for food safety.
The move is part of the Prime Minister's Directive 17/CT-TTg issued on April 13 to continue strengthening State management of food safety.
The People’s Committees of provinces and cities must also strengthen the management of food safety in trade villages, local markets and wholesale markets that sell agricultural products.
Meanwhile, centrally-run provinces and cities are requested to develop safe food production areas or chains and safe food distribution systems, and promote the application of quality management processes.
The Prime Minister asked the Ministry of Industry and Trade (MoIT) to develop a safe food distribution system and manage food markets. The MoIT also needs to strengthen market management and prevent smuggling, trade fraud, fake goods and the trade of food with unclear origins.
The MoIT must also strictly manage multi-level business and e-commerce activities for food products, especially supplements and nutrition products.
The Prime Minister assigned the Ministry of Health to continue studying and perfecting food safety management regulations in accordance with international practices.
The ministry must also enhance inspections and handling of violations regarding the advertising of supplement products and food additives, while boosting inspections of food safety management in centrally-run provinces and cities.
Meanwhile, the Ministry of Agriculture and Rural Development will direct localities to promote the development of safe farm produce regions, food production and trade chains, and wholesale markets.
The ministry must strengthen the management of plant protection drugs, veterinary drugs, fertilizers, animal feeds and slaughter of cattle and small poultry.
Vietnam had made progress in controlling food safety in recent years, according to the directive. However, there were still many challenges left to ensuring food safety because the country mainly relied on small-scale food production.
To improve the efficiency of food safety management, the Prime Minister has requested ministries, ministerial-level agencies and people's committees to take responsibility for food safety while strengthening inspections and handling of food safety violations.
At the same time, they must promote administrative reforms and IT applications to create favourable conditions for food production and trade enterprises to implement those administrative procedures./.
Thailand boosts exports of rubber products amid COVID-19
Thailand is maintaining exports of rubber products and processed rubber as global demand surges, particularly for those relating to protective gear against COVID-19 such as rubber gloves and synthetic rubber used to make such gloves.
Auramon Supthaweethum, Director-General of the Trade Negotiations Department under the Ministry of Commerce, said Thailand's outbound shipments of rubber products and processed rubber in the form of finished products such as auto tyres, rubber gloves, resistance bands and rubber bands rose 10 percent in the first two months of 2020 to 1.97 billion USD.
Free trade agreements (FTAs) were one of the reasons behind higher shipments, she said, adding that Thailand has 13 FTAs in place with 18 countries and territories, with 14 no longer collecting import tariffs on Thai rubber products, including the Association of Southeast Asian Nations (ASEAN), Japan, Australia, New Zealand, Peru and Hong Kong.
Four countries, namely China, the Republic of Korea, India and Chile, are maintaining import tariffs on some rubber products.
In 2019, Thailand exported 5.14 billion USD worth of rubber products to the countries and territories with which it has signed FTAs.
Last year, Thailand was the world’s fourth-largest exporter of rubber products and processed rubber, after China, Germany and the US, with total exports of 11.23 billion USD, a year-on-year rise of 2 percent./.
Singapore, New Zealand pledge to keep trade in essential goods
Singapore and New Zealand on April 15 jointly announced a declaration on trade of over 120 products identified as essential goods for combating the COVID-19 pandemic.
Singaporean Minister of Trade and Industry Chan Chun Sing said the declaration aims to enable the continued production and flow of essential supplies to their intended destinations.
He added that Singapore will receive its first shipment of essential supplies from New Zealand next week under the agreement.
According to the declaration, the two countries will remove tariffs for 120 essential products, and not to impose export restrictions.
The declaration builds on an earlier joint ministerial statement on supply chain connectivity issued by Singapore and New Zealand in March.
Seven other countries, namely Australia, Brunei, Canada, Chile, Laos, Myanmar and Uruguay, have also pledged their commitment to the statement to ensure supply chain connectivity amid the COVID-19 pandemic./.
Malaysia's natural rubber production decreases
Malaysia's natural rubber production was 46,881 tonnes in February, down 29.2 percent from the previous month and 20.6 percent compared to the same period last year, according to the Malaysian Statistics Department.
The decline was due to the annual wintering period that typically falls between February and May.
Meanwhile, the country's natural rubber exports surged 13.1 percent month on month to 51,852 tonnes in February.
China remains the top natural rubber importer of Malaysia, accounting for 47.1 percent of the total exports in the month. This was followed by Germany (9.7 percent) and Iran (4.1 percent).
The natural rubber stocks stood at 288,586 tonnes in February, an increase of 2.7 percent from January./.
IMF cuts Philippine 2020 GDP growth forecast to 0.6 percent
The International Monetary Fund (IMF) has slashed its growth outlook for the Philippines for 2020 from 6.3 percent to 0.6 percent due to the impact of the coronavirus disease 2019 (COVID-19).
Despite the big drop in its projection, the lender forecasts a recovery of the domestic economy in 2021, with an expansion of 7.6 percent.
These projections are in line with its 0.6-percent growth forecast for ASEAN-5 for this year and 7.8 percent next year.
IMF Country Representative to the Philippines Yongzheng Yang attributed the cut in their growth projections for the country to supply disruptions related to COVID-19 and weaker demand in the Philippines’ major trading partners.
Tighter global financial conditions, weaker public confidence, and lower remittances are also expected to weigh on private consumption and investment, Yang said.
He, however, said these factors are seen to be countered partly by policy support.
The Philippine government has formulated fiscal and monetary measures worth 1.1 trillion PHP (21.7 billion USD) to help sectors affected by the pandemic while various levels of quarantine have been raised nationwide to curb the further rise of COVID-19 cases.
Yang said stemming the spread of COVID-19 is of utmost importance, and policies at the moment should focus on both protecting public health and putting people back to work.
He said the IMF welcomes the Philippine government’s measures to address the pandemic’s impact.
He noted that because of prudent macroeconomic management, the Philippines has built considerable policy buffers in recent years, and both the government and the central bank have been making good use of this policy space.
"The country has ample room for additional policy stimulus, if needed, given the relatively low level of public debt and well-anchored inflation expectations,” Yang said./.
Vietcombank slashes interest payments by 10% for pandemic-hit borrowers
The Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank) has introduced a second interest rate cut to help companies and individuals hurt by the COVID-19 pandemic.
It will slash interest payments by 10 percent from April 15 to September 30 for directly-hit companies and individuals, while those indirectly-affected will see their payments cut by 5 percent to June 30.
The bank estimates the policy will benefit some 90,000 borrowers that have taken out a combined 300 trillion VND (12.77 billion USD) in loans, or nearly half of its total outstanding loans.
Borrowers who received preferential interest rates are not subject to the new policy.
As at the end of March, the bank had cut its lending rates by 0.5-1.5 percent and maintained existing loan classifications for affected customers in order to cushion the blow from the outbreak.
It has also cut fees on online transactions to encourage customers to adopt cashless payments.
Vietcombank reported 23.15 trillion VND (1 billion USD) in total profit last year, a year-on year increase of 26 percent.
The COVID-19 pandemic is forecast to slash its profit this year by over 2.24 trillion VND./.