BUSINESS NEWS HEADLINES JAN. 31

Market to maintain uptrend in post Tet period

BUSINESS NEWS HEADLINES JAN. 31


The market is forecast to maintain its uptrend during the first sessions in the Year of the Rat, according to securities companies and experts.

The benchmark VN-Index on the Ho Chi Minh Stock Exchange finished the last trading day of the Year of the Pig (January 23) at 991.46 points.

In the final trading week before Tet (Lunar New Year) holiday, the index rose a total 1.27 per cent.

The HNX Index on the Ha Noi Stock Exchange ended January 23 up 0.65 per cent, closing at 106.28 points, ending the week 2.31 per cent higher than the previous one.

According to Bao Viet Securities Co (BVSC), successfully penetrating through the resistance zone of 970-972 points, the market is trending upward and will possibly approach a resistance zone of 995-1,000 points in the short term.

“Historically, this zone has challenged the market many times. Therefore, we leave open the possibility that the market will face volatility and correction pressure at this zone,” BVSC said.

According to BVSC's statistics, since 2010, the market has usually increased in 10 sessions after the Tet holiday with a strong increase in trading volume and value. In 8 out of 10 observed years, the VN-Index increased at an average of 4.31 per cent. Trading volume increased in 8 out of 10 years, with an average increase in those 8 years at 45.03 per cent and trading value increased in 9 of 10 years with an average increase of 40.31 per cent.

History shows that Viet Nam's stock market has a high probability of going up after Tet. Most securities companies forecast that the VN-Index may surpass 1,000 points this year, according to Nguoi Dong Hanh online newspaper.

In 2020, Viet Nam’s stock market turns 20 years old.

According to the e-newspaper’s statistics, in 13 out of 19 years the VN-Index increased in the last five days before Tet, and in 12 out of 19 years the VN-Index rose in the first five days after Tet.

Le Duc Khanh, director of market strategy department at PetroVietnam Securities (PSI) told Nguoi Dong Hanh that factors supporting the market this year include stable economic growth, which is still the driving force for Viet Nam to be an attractive destination for global investment flows, including both direct and indirect investment.

“Viet Nam’s stock market will continue going up in 2020, but in a narrow band,” Khanh said.

In 2020, foreign investors may continue their capital disbursement, as this is the year in which the Government and ministries will strongly promote the equitisation and divestment process of SOEs, Khanh said.

Dinh Quang Hinh, director of the market strategy division at VNDirect Securities Corporation's analysis department, said a factor that can have a positive impact on the stock market in 2020 is the profit growth of listed enterprises, which is forecast to reach 18 per cent, a significant improvement from the rate of 14.5 per cent in 2019.

The expert from VNDirect said that the VN-Index may head towards 1,160 points at the end of this year mostly thanks to the profit growth improvement of listed companies.

Hinh expects there will be some positive information to cool down trade tensions between the US and China in 2020, especially the upcoming US Presidential election that will take place in late 2020.

Hinh also believes that the banking group will be the growth pillar to lead the market up.

According to Hinh, the banking sector continues to be the main growth engine of the market. Food and beverage and retail sectors will also flourish thanks to growing domestic consumption in 2020. The information and technology group will also thrive thanks to the Government’s favourable development policies and incentives.

Gold climbs on fast-spreading coronavirus outbreak

Local gold prices rose on Thursday amid rising concerns over the coronavirus outbreak in China which buoyed demand for safe assets.

In the afternoon, prices quoted by Saigon Jewelry Company (SJC), Viet Nam’s biggest gold firm, stood at VND44.15 million (US$1,903) per tael for buying and VND44.55 million ($1,920) for selling, up VND750,000 for buying and VND800,000 for selling compared to the last trading day before the Tet (Lunar New Year) holiday.

A tael is equivalent to 1.2 ounces.

Gold bars sold at Phu Quy Gold, Silver and Gem Stone Group also increased VND750,000 to VND44.2 million per tael, while the company bought gold at VND44.2 million, up VND700,000 from January 22.

Meanwhile, gold prices at Bao Tin Minh Chau Jewelry Co and Doji Gold and Gem Group increased between VND550,000 and VND700,000 per tael, being quoted at VND44.2 million for buying and VND44.5 million – VND44.6 million for selling.

After the seven-day holiday, domestic gold prices jumped on Thursday in line with a fever on the world markets following which gold neared a seven-year peak on investor fears that the spread of the coronavirus in China would impact Chinese economic data and likely push the world economy into recession.

At 3pm local time, gold futures on the New York Commodities Exchange (Comex) added 0.67 per cent to $1,580.9 per ounce. Spot gold stood at $1,581 per ounce. The safe-haven asset also increased on Wednesday.

Traders are evaluating the potential impact of the new epidemic on the global economy. Research firms have warned about overreacting at this time as the panic will ease after a few weeks or months.

The Wuhan outbreak has dominated global headlines for a week and the World Health Organisation (WHO) is set to reconvene later on Thursday and could possibly decide to announce a global health emergency over the outbreak.

The latest data on Thursday showed the virus killed 170 people and infected nearly 8,000 people around the world.

In addition, gold’s bullish trend is being supported by the Fed’s decision to keep the rate unchanged at 1.5-1.75 per cent and geopolitical tensions in some countries.

In Viet Nam, gold is expected to continue rising toward the God of Wealth Day which falls on February 3.

Oil firm bags nearly $4.4 billion in 2019

The Binh Son Refining and Petrochemical JSC (BSR), a subsidiary of the Viet Nam Oil and Gas Group (PetroVietnam), has reported gross revenue of VND102.82 trillion (nearly US$4.4 billion) last year.

According to a consolidated financial report released on Monday, BSR’s after-tax profit hit more than VND2.75 trillion, contributing over VND9.7 billion to the State budget.

The firm’s equity increased from VND31.37 trillion at the end of 2018 to over VND33.9 trillion last year. Meanwhile, its liabilities decreased nearly VND2 trillion to VND19.5 trillion.

Total assets of BSR stood at over VND53.4 trillion. In the first quarter of this year, the company wants to ramp up operations at the Dung Quat Oil Refinery Plant to its maximum capacity to complete its production targets for the year.

Pepper price to remain low this year

Pepper prices this year are unlikely to recover after a strong reduction in 2019 due to abundant supply.

The demand of pepper-consuming countries has not yet shown signs of strong growth.

Viet Nam this year expects to have bumper harvests from the many pepper plantations created in 2017.

The domestic market still has a significant stock of pepper from the previous crop, with many households and businesses stockpiling to wait for higher prices, the Viet Nam Pepper Association said.

On the world market, pepper output is likely to increase from some major producing countries. In India, the pepper output this year is expected to reach about 61,000-62,000 tonnes, up by 30 per cent year on year.

According to the association, Brazil has a production model at very low cost and high yield. Those factors help Brazilian pepper’s competitiveness on the global market.

With the sharp increase of pepper planting acreage in many countries in the 2016-17 period, the global pepper market is forecast to maintain supply until at least the end of 2020, the association said.

Therefore, domestic pepper experts believe this year pepper prices are likely to continue falling.

The pepper price is likely to continue to drop to about VND36,000-38,000 per kilo, and possibly VND35,000.

In the early days of January, the price was at VND39,000-42,000 per kilo.

However, the pepper price would not plunge further because with prices at around VND37,000, speculators will purchase pepper, according to the association.

The domestic pepper price is expected to remain at a low level until the end of this year's crop, it said.

This price is forecast to increase slightly in 2021 and see strong recovery from 2022 when the strong reduction in output at home and abroad will help revive the price on the local and global markets.

The lower future supply is due to farmers shifting to other crops.

Last year was the third consecutive year Viet Nam gained a record in pepper export volume. But its pepper export value declined against the previous year due to the plunge in the global price.

In 2019, the average export price of pepper was US$2,516 per tonne, a reduction of 23.6 per cent year on year.

According to the Ministry of Agriculture and Rural Development (MARD), Viet Nam last year exported 284,000 tonnes of pepper, earning $715 million. The exports rose by 23.4 per cent in volume but fell by 5.7 per cent in value year on year.

Of which, the US continued to be the largest export market of Vietnamese pepper, accounting for 19.5 per cent of the total exports. Following were India, Germany and the Netherlands.

Pepper exports to most markets saw surges in volume but decreases in value. However, Viet Nam saw significant growth in pepper exports to Germany in both volume and value.

The nation also gained high growth in pepper exports to some markets including Thailand, Russia and Turkey. The exports surged by 89.4 per cent in volume and 46 per cent in value to Turkey, 40.6 per cent in volume and 10.3 per cent in value to Russia, and 34.8 per cent in volume and 0.6 per cent in value to Thailand.

This year, the free trade agreement between Viet Nam and the EU (EVFTA) is expected to create good conditions and opportunities for the domestic pepper industry to promote exports to the EU, especially the German market.

This agreement would also help pepper exporting enterprises expand their export markets and have more chances to attract foreign investment in the processing stage.

Total goods and service retail sales up in January

Total retail sales of goods and services in January were estimated at VND448.1 trillion, up 3.6 per cent over the previous month and up 10.2 per cent year on year, according to the General Statistics Office (GSO).

If excluding the price factor, the retail sales this month rose by 7.2 per cent year on year.

January had good performance in retail sales of goods and services because businesses, shopping centres, supermarkets and business facilities actively prepared diversified sources of goods for before and during the Lunar New Year festival.

Of which, the retail sales of goods in January was estimated at VND346.2 trillion, up 6.3 per cent month-on-month and up 10.7 per cent year on year. The goods with a strong growth in retail sales year-on-year included food and foodstuffs (7.2 per cent), garment and textile (8.2 per cent), vehicles (6.7 per cent), cultural and education products (3.3 per cent), and household appliances, tools and equipment (6.1 per cent).

Some localities had a high growth rate in goods retail sales compared to the same period last year, such as Nghe An (18.7 per cent), Hai Phong (14.3 per cent), Ha Noi (14.7 per cent), Khanh Hoa (14 per cent), HCM City (13.3 per cent) and Binh Dinh (9.7 per cent).

Meanwhile, the revenue from accommodation and catering services in January this year was estimated at VND50.6 trillion, down 2.6 per cent over the previous month but up 6.8 per cent over the same period last year.

In January, this revenue rose by 14.2 per cent compared to the same period last year in Da Nang, 12 per cent in Hai Phong, 9.7 per cent Quang Tri, 6.5 per cent in Quang Nam, 6 per cent in Thai Binh, 5 per cent in Ha Noi and 4.5 per cent in HCM City.

The travelling service revenue in the month was estimated at VND4.2 trillion, down 2 per cent from the previous month but up 7.4 per cent over the same period last year. It rose by 16.6 per cent in Da Nang year on year, 9.2 per cent in Can Tho, 7.2 per cent in HCM City, 6.2 per cent in Hai Phong and 5.6 per cent in Ha Noi.

The revenue from other services was estimated at VND47.1 trillion, down 6.6 per cent from the previous month and up 10.7 per cent over the same period last year.

EABC 2020 to promote development of MSMEs

Many initiatives will be offered to foster cooperation among regional businesses towards further promoting trade and investment exchange in the region after Vietnam takes over the chairmanship of the East Asia Business Council (EABC) in 2020.

According to Chairman of the Vietnam Chamber of Commerce and Industry (VCCI) Vu Tien Loc, priority will be given to promoting development of micro, small and medium sized enterprises (MSMEs).

Attention will also be paid to enhancing business-related economic and trade policies to ensure regional integration, and sustainable growth for East Asian countries through realising the ASEAN Economic Community (AEC) and the Regional Comprehensive Economic Partnership (RCEP).

MSMEs and businesses owned by women in East Asia countries will be provided with facilitation to access capital and international markets in order to successfully participate in the global value chain.

EABC will also optimise the potential of human resources, promote startups and innovation on the basis of digitalisation for an inclusive digital future for the East Asian region.

This is consistent with policies of the Vietnamese Party and State and is an opportunity for Vietnam's economy and business community to connect with East Asian economies and the world, Loc stressed.

In 2020, Vietnam will also assume the chairmanship of ASEAN and the ASEAN Business Advisory Council (ASEAN BAC), he added.

Accordingly, many policies and priority actions will be rolled out to boost cooperation among regional enterprises and international economic integration as well.

ASEAN BAC 2020 will focus on expanding digitalisation for sustainable and inclusive socio-economic development in the region.

MSMEs - key economic drivers of ASEAN countries - will be supported to fully tap opportunities and respond to challenges from the digital age, thus growing more strongly and sustainably, Loc said.

According to the VCCI, the 19th ASEAN Business and Investment Summit (ABIS 2020) will be held in November this year along with the 37th ASEAN Summit in Hanoi./.

Improving labour productivity critical for businesses

Improving labour productivity is vital for Vietnamese businesses in the context of the Fourth Industrial Revolution, with rapid increases in digitalisation, robotisation and intelligent automation, experts said.

Labour productivity was the core factor in the competitiveness of the economy and every enterprise.

However, labour productivity of Vietnam remained low compared to other countries in the region, according to Nguyen Chi Hai and Huynh Ngoc Chuong from the University of Economics and Law under the Vietnam National University, HCM City.

In a publication on the online newspaper of the Government baochinhphu.vn, they cited statistics from the Asian Productivity Organisation showing that the per-hour labour productivity level of Vietnam was 5.2 USD, higher than Cambodia and Myanmar, but lower than Laos.

Vietnam’s labour productivity was equivalent to eight percent of Singapore and 35.86 percent of Thailand.

In addition, most private firms of Vietnam (98 percent) were of micro, small and medium sizes, meaning that labour intensity, limited technology and management capacity and low product quality remained common, they pointed out.

Inadequate investment for research and development also limited the competitiveness of Vietnamese private companies. Most private firms were using technologies about two generations more outdated than the global average. Only 15 percent invested in research and development.

Foreign-direct-investment (FDI) companies remained dominant in exports.

Improving labour productivity is vital for Vietnamese firms to improve competitiveness, the experts said.

Vietnam needs policies to increase labour productivity by 7- 8 percent per year, with a focus on productivity in industry first, then agriculture and service sectors.

For firms, it was necessary to select the products of their competitive advantage, renovate technologies and improve management capacity – the key to boost labour productivity.

The experts said that in the context of Industry 4.0, promoting the development of knowledge economy, sharing economy and digital economy was important to improving competitiveness, which would help Vietnam to narrow the gaps with other countries.

Focus should also be placed on improving quality of human resources and attracting talents.

While the US-China trade war remains unpredictable, Vietnamese firms were facing significant pressure.

“There will be many approaches to offer solutions for businesses. However, it can be affirmed that internal factor will be the decisive factor. Improving competitiveness will be the key to sustainable development of businesses in particular and the Vietnamese economy in general,” the experts wrote.

The increase in automation in Industry 4.0 triggered worries about huge job losses.

However, Nguyen Duc Thanh, Director of the Vietnam Institute for Economics and Policy Research said that this is the time to improve labour productivity.

“This will be an unprecedented development era of human beings in labour productivity,” Thanh said, because automation would force people to learn to create new value./.

Petrol prices drop slightly in latest review

The retail prices of petrol were reduced as from 3pm on January 30 following the latest adjustment by the Ministry of Industry and Trade and the Ministry of Finance.

Accordingly, the price of biofuel E5 RON92 was down by 577 VND to 19,268 VND (0.83 USD) per litre at the highest, and that of RON95-III also fell by 791 VND to 20,122 VND per litre.

Meanwhile, the prices of diesel 0.05S and kerosene stand at 16,136 VND per litre and 15,062 VND per litre, down 412 VND and 473 VND per litre, respectively.

Mazut 180CST 3.5S is sold at no more than 12,444 VND per kilogramme, down 265 VND per kilogramme./.

Registered capital of new firms hits four-year high

A total of 8,276 new enterprises were established in the first month of 2020, down 17.9 percent year-on-year, but the total registered capital of the firms surged sharply by 76.8 percent to 267.2 trillion VND (11.55 billion USD), the highest growth rate in four years, the General Statistics Office (GSO) reported.

With the surge, average registered capital of new enterprises was at 32.3 billion VND, up 115.3 percent year-on-year.

The decline in the number of new enterprises in January was attributed to the country’s largest festival – Lunar New Year – while the sharp surge in capital was thanks to the establishment of a new enterprise in the finance-banking-insurance industry that had a registered capital of 144 trillion VND (6.22 billion USD), accounting for 53.9 percent of the total registered capital.

The new enterprises created 84,500 jobs, down 21.7 percent year-on-year.

January also saw 8,470 enterprises resuming operations, a rise of 0.1 percent against the same period last year, bringing the total number of newly-registered and revived enterprises in January to 16,746.

A number of industries witnessed significant declines in the number of newly-established enterprises in the month. Motorbike and automobile trading and repair was down 38.6 percent year-on-year; mining, down 32.6 percent, healthcare and social welfare down 23.9 percent, construction down 15.1 percent and manufacturing and processing down 7 percent.

However, five industries saw the number of newly established enterprises increasing, including production and distribution of electricity, gas and water up 8.6 percent; information and communications up 8 percent; science, technology, consultancy, design, advertising and others up 4.6 percent; education and training up 2 percent; and catering services and accommodation up 0.2 percent.

The GSO also reported that the number of enterprises temporarily ceasing operations in January was 11,702, up 8.3 percent year-on-year.

 

The number of enterprises which finished procedures for bankruptcy in the period was 1,621, down 10 percent from the same period last year. Of the enterprises, 1,451 had registered capital of less than 10 billion VND./.

Binh Thuan targets over 7 million tourists in 2020

The south central province of Binh Thuan aims to lure more than 7 million visitors, including 850,000 foreigners, in 2020.

The locality also targets 18.3 trillion VND (790.7 million USD) in tourism revenue.

In a bid to realise the goals, the tourism sector will develop standout products such as sea-based tourism and sand dune ecosystem.

Along with carrying out the project on building Binh Thuan into a national tourism-sport hub, the provincial Department of Culture, Sports and Tourism will channel focus on promoting local image as a safe, friendly and quality destination, and developing new tourism products such as eco-tourism, experience tourism and community tourism.

At the same time, the province will create favourable conditions for businesses to land investment in local typical tourism products.

A multitude of tourism promotion programmes will be organised this year, including the second “Binh Thuan – green convergence” event with various activities like street festival, food festival, firework display and hot air balloon performance, among others.

In addition, Binh Thuan will organise many training courses to improve capacity of tourism human resources.

The Department of Culture, Sports and Tourism said that in 2019, the province hosted more than 6.4 million tourists, comprising 775,000 foreigners, up 11.39 percent from the previous year.

Revenue from tourism reached over 15.1 trillion VND, a year-on-year rise of 17.5 percent.

Last year, the province attracted additional six tourism projects, raising total valid projects in the sector to 383 with total registered capital of more than 59 trillion VND. There were 24 foreign-invested projects valued at over 561 million USD.

Binh Thuan province is currently home to 550 lodging facilities with 16,500 rooms./.

Some 1,300 tonnes of farm produce exported via Lao Cai Border Gate

More than 1,300 tonnes of agricultural products worth about VND20 billion (US$860,000) were exported to China via the Lao Cai International Border Gate in the northern mountainous province of Lao Cai on Sunday (the second day of the Lunar New Year).

These first batches included dragon fruits, jackfruit, watermelon, mango and rambutan, according to the Lao Cai International Border Gate Customs sub-department.

The same day, 24 tonnes of grapes were allowed to be imported from China through the border gate, it said.

From the beginning of 2019 to October, the department had handled procedures for more than 475,000 tonnes of dragon fruits, worth $310 million, up by 15 per cent in volume and 15.4 per cent in value over the same period in 2018.

The sub-department now offers round-the-clock e-customs declaration and has eased customs procedures for export goods, especially agricultural products.

It has prioritised completing customs clearance as soon as possible to export all Vietnamese agricultural products in the morning.

Now, dozens of agricultural products are facilitated for export to China, such as dragon fruit, pepper, lychee, watermelon, mango, banana, cassava and potato.

ASEAN needs to rely on its own strengths to drive growth: economists

With uncertainties and increasing rivalry among major powers in the world, ASEAN, especially Viet Nam, will need to rely on its own devices to drive growth this year, economists said.

With slower global growth expected this year, ASEAN’s prospects would depend on its ability to boost domestic demand, they said.

According to a recent HSBC report, the region is fortunately about to embark on a new investment cycle led by a planned surge in public infrastructure spending.

Growth should improve in 2020, but enacting key reforms this year is essential for sustaining it over this decade.

Last year ended on an optimistic note amidst a slight thaw in US-China trade relations and improving global economic data, but this optimism could dissipate.

Global growth may slow, led by weaker activity in China and the eurozone, not to mention geopolitical risks.

ASEAN, located at the centre of a vast area connecting the Indian and Pacific Oceans, has both opportunities and challenges.

With a population of more than 642 million and an area of more than 1.7 million square kilometres, ASEAN represents a market with huge potential, a vibrant economy and a bright spot in the global economy.

ASEAN members have also been striving for new heights, harnessing the benefits of the Fourth Industrial Revolution by adopting new technologies such as AI and cutting-edge robotics.

However, the increase in protectionism and trade friction among super powers are posing challenges and hindering global trade and economic growth.

Meanwhile, disparities in economic development among member states and demands for deeper integration in a new phase of development require “appropriate” economic policies, experts said.

Recommendations

ASEAN needs to maximise its opportunities and address challenges to sustain sustainable growth, they said.

To persevere and respond to turmoil in the region and the world, ASEAN needs to maintain solidarity and unity, bolster economic resilience, speed up its response to emerging challenges, foster innovation, and reinvent itself to move forward.

Tim Evans, CEO of HSBC Viet Nam, said the region has achieved incredible economic development over the past 20 years.

However, the region runs the risk of slowing growth and the key will be how policymakers continue to build greater connectivity across the trade block, he added.

HSBC research suggests Southeast Asia’s contribution to global GDP could rise to 8 per cent if reforms are made.

According to the report, it is important to foster a more linked region by further cutting non-tariff trade barriers and developing infrastructure.

While most tariffs have been removed across Southeast Asia, more than 6,000 non-tariff trade barriers have emerged in the region.

“The region has been successful in removing virtually all formal tariffs; however, we’re seeing the emergence of 'below-the-line' trade barriers instead,” Evans said.

“These can impact the region’s ability to attract further international investment, particularly in areas linked to the increasing shifts in supply chains, if left unaddressed.”

A significant offset to these barriers will be the ASEAN-led Regional Comprehensive Economic Partnership (RCEP), which includes 30 per cent of the world’s population and 29 per cent of the world’s GDP.

The trade deal is expected to be signed early this year.

Besides, it is vital to ramp up investment in sustainable infrastructure that will both bring the region closer together and expand the opportunities for industry.

According to the Asian Development Bank (ADB), Southeast Asia needs to invest US$210 billion or 5 per cent of its GDP a year over the next decade in infrastructure just to maintain current levels of growth.

And this challenge is compounded by the environmental threat facing the region.

The ADB estimates that if left unaddressed, climate change could reduce the region’s GDP by 11 per cent by the end of the century.

ASEAN member states will need to be increasingly focused on smoothing the path for greater private sector investment in infrastructure.

It is also necessary for ASEAN to create a seamless digital region by improving digital connectivity.

Digital technology has the potential to play a key role in driving the development of new industries and growth.

But to realise that potential the region has to agree on a common set of standards for data handling and digital commerce, which will encourage businesses to share data.

Different digital regulatory regimes across Southeast Asia limit the ability of both local firms and multinationals to reap the full benefits of economies of scale, weakening its attraction as an investment destination.

The Master Plan on ASEAN Connectivity is important to enhance data management, facilitate harmonisation of data regulations among ASEAN member states and promote intra-ASEAN data flow.

Reforms needed for Viet Nam

This year will be a significant one for ASEAN and Viet Nam as the bloc will conduct a mid-term review of the implementation of the Master Plan on building ASEAN Community by 2025 and the country will assume non-permanent membership of the UN Security Council.

A number of key reforms are expected in the country this year in which infrastructure is a crucial area, especially fiscal-related reforms.

Given Viet Nam’s budget constraints and increasing demand for more public infrastructure, the private-public partnership (PPP) model has become a ‘sustainable’ solution for financing infrastructure works.

To encourage private investors, more reforms are needed to address PPP-related issues, and the country is taking steps in this direction.

Expected to pass this year, the revised PPP Law is looking to strengthen the legal framework and address some issues that concern investors.

The country is seeking to continue its fiscal consolidation to further bring down high public debt-to-GDP ratio.

The new Law on Taxation Administration, which takes effect in July this year, is a positive move to strengthen the tax collection mechanism.

In the banking sector, from this year all banks in Viet Nam would have to meet Basel II norms, which require a minimum capital adequacy ratio (CAR) of at least 8 per cent.

Only 16 domestic and two foreign banks have met the requirements so far. Small banks are under pressures to increase their capital to meet the standards.

This year is a big one for Viet Nam’s foreign policy as the country has taken over as ASEAN chair.

Viet Nam has selected the theme “Cohesive and Responsive” for ASEAN 2020, which reflects the need to enhance ASEAN unity and solidarity, economic integration, ASEAN awareness and identity, and working towards a “people-centered” community.

Viet Nam’s chairmanship will focus on upholding ASEAN’s responsibilities and positive roles in maintaining regional peace, security and stability on the basis of strengthening the bloc’s solidarity and unity.

The country has set a number of priorities based on ASEAN’s goals enshrined in the ASEAN Community Vision 2025 and seeks to build upon the themes and priorities set by previous chairs.

The priorities include strengthening unity and solidarity and reinforcing ASEAN centrality, contributing to regional peace and stability amid strategic complexities. 

Firms urged to be cautious when exporting to Myanmar

Vietnamese exporters need to be cautious when shipping goods to Myanmar despite untapped opportunities available in the market, according to the Viet Nam Trade Office in Myanmar.

Under Myanmar's regulations, if imported goods arrive at the country’s ports and fail to clear customs within 60 days, these goods would be auctioned or confiscated. Therefore, Vietnamese enterprises need to be careful when exporting to Myanmar to avoid business losses, the office warned.

Firms should improve their understanding about the country’s laws as they make transactions with local partners, the office suggested.

Additionally, businesses could encounter other challenges in the market, due to its import licensing requirements, slow goods clearance, low incomes of the majority of local people and their shopping habits – favouring cheaper products.

According to trade experts, consumers there were particularly fond of Vietnamese fresh produce and processed foods, such as coffee and fruits. The prices of Vietnamese goods were very competitive, they said.

However, the goods still faced fierce competition from other companies in the region, which required Vietnamese enterprises to improve product quality and reduce costs to improve their competitiveness.

Vietnamese manufacturers should also make efforts to establish their brands in the global market and invest more in product packaging and labelling, they said.

Despite these challenges, Myanmar remained a lucrative market for Vietnamese companies because of the country’s insufficient production capacity, few strict technical barriers to imported goods, and tax incentives for products imported from ASEAN members.

Myanmar is a great market for a wide range of Viet Nam's good and services, from food and materials for food processing, electronics and electrical goods, iron and steel, bikes and motorbikes to information and telecommunications, according to the office.

Bilateral trade between the two countries increased significantly from a modest US$152 million in 2010 to nearly $860 million in 2019. It is estimated to reach $1.05 billion in 2029.

Viet Nam is also the seventh largest investor in Myanmar, with 18 large projects worth a total of nearly $2.2 billion. Major companies such as Hoang Anh Gia Lai, the Bank for Investment and Development and Viettel have operations there.

FDI inflow in Da Nang hits nearly $700m in 2019

Foreign investors pumped nearly US$700 million into the central coastal city of Da Nang in 2019, according to the municipal Department of Planning and Investment.

Of the total, about $440 million was invested in 132 newly-licensed projects during the year, eight times higher than one year ago, while $120 million was added to 16 operating projects, 63 times higher than 2018’s figure.

During the year, foreign investors also spent $135.3 million on capital contribution and share purchase in domestic enterprises, nearly triple that of 2018.

In addition to foreign-invested projects, the city last year also granted in principle approval for nine domestically-financed projects, worth VND8.82 trillion. That brought the number of projects in the locality up to a value of more than VND104 trillion.

The positive figures were attributable to local authorities’ great efforts in accelerating administrative reforms to better facilitate domestic and foreign investors, the department’s director Tran Phuoc Son told online newspaper enternews.vn.

This year, the city will concentrate on developing technical infrastructure of industrial zones and clusters and fostering investment promotion targeting foreign businesses who will invest in the city’s key sectors, such as IT and supporting industries, Son said.

In order to continue luring investment, the city will deploy a number of key projects such as an overall development plan for Da Nang Hi-Tech Park; one-stop shop model for the preparation, licencing and management of investment projects outside industrial parks and hi-tech zones and the improvement of hi-tech innovative features and hi-tech start-ups, the online newspaper nhandan.com.vn cited vice chairman of the municipal People's Committee, Ho Ky Minh, as saying.

The city also focuses on promoting activities and events which effectively approach strategic investors in key markets, such as Japan, South Korea, Singapore, the US and Europe, he told the newspaper.

Le Tri Hai, Vice Chairman of the Da Nang Young Entrepreneurs' Association said in order to improve the investment environment and enhance investment attraction, Da Nang needed to accelerate investment procedures, develop environmental impact assessments and issue investment guidelines. 

Dong Nai pulls the plug on 531 tardy foreign projects

The southern province of Dong Nai last year scrapped the licences it had issued for 531 proposed foreign projects due to slow progress.

They involve combined investment of over US$5.34 billion, according to the local Department of Planning and Investment.

After receiving their investment registration certificates, most foreign investors quickly bring in money, import machinery and equipment and build plants, usually in one to two years, and begin doing business, according to Mai Van Nhon, deputy head of the Dong Nai Industrial Zones Authority (DIZA).

Investors who delay their projects due to unexpected difficulties would get assistance from the province, with the DIZA always working with investors to find out the reasons, he said.

If they are determined to do business, their licences would get an extension, but investors who sound unreasonable or deliberately delay their projects would lose their licences, which would then be given to others, he added.

According to the department, the province received more than $1.96 billion worth of FDI last year, nearly double the targeted amount.

So far the province has attracted over 1,200 foreign projects with an investment of $24 billion.

In the process of promoting investment, Dong Nai has established relations with companies and localities around the world, which has helped it gradually improve its technology standards, facilitating international integration.

Along with the development of industrial parks, other related services, such as logistics, construction, healthcare, and housing are also developing rapidly in the province.

Bac Lieu approves $4b LNG-fired thermal power plant

The People’s Committee of Bac Lieu Province on Tuesday granted an investment certificate to Singapore’s Delta Offshore Energy Pte Ltd Co to develop a liquefied natural gas (LNG)-fired thermal power plant in the province.

The Bac Lieu LNG-fired thermal power plant, expected to cost about US$4 billion, will cover 40ha in Vinh Hau A Commune, Hoa Binh District. It is the biggest foreign-invested project in the Cuu Long (Mekong) Delta region thus far, online newspaper sggp.org.vn reported.

The committee chairman Duong Thanh Trung described the plant as one of the province’s key projects, which played a role in transforming the province's economic structure.

The project will create thousands of local jobs and contribute thousands of billions of dong to the local budget once it comes into operation, Trung said.

With a designed production capacity of 3,200 MW, the plant comprises four gas turbine units with a capacity of 750MW each and one unit with a capacity of 200MW.

According to the committee, four gar turbines of the plant are expected to be completed at the end of 2023 while the remaining one is slated for completion in late 2027.

According to experts, the development of LNG is a trend to diversify fuel sources, contributing to the country’s energy security.

In the development plan for Viet Nam’s gas industry, the demand for LNG will increase to about five million tonnes by 2025, about 10 million tonnes by 2030 and 15 million tonnes by 2035.

In order to accomplish this goal, Viet Nam has developed LNG import warehouses and ports. It has also built and issued a legal framework for the development of Viet Nam’s LNG industry, and set up priority projects based on LNG demand and investment promotion.

Over 67,000 orders for VinFast vehicles in 2019

VinFast Trading and Production LLC, a subsidiary of Vietnamese conglomerate Vingroup, has reported it had received over 17,000 orders for VinFast cars, and 50,000 others for electric motorcycles in 2019.

The company launched its first electric scooter Klara in November 2018, and to date, three more brands have been sold in the market, including Ludo, Impes and Klara S. Up to 45,118 scooters have been produced so far.

Last year, Vingroup joined the Vietnamese auto market by rolling out segment-A Fadil, SUV Lux SA 2.0 and sedan Lux A 2.0 brands. As many as 17,214 orders have made for the three models while VinFast has manufactured 15,300 vehicles so far.

In 2020, VinFast will introduce VinFast Lux V8, two crossover models, and electric buses to the market. The firm also plans to export electric cars to the US.

Currently, all of the VinFast vehicles are produced at the 335-hectare complex in Dinh Vu-Cat Hai Industrial Park, which is equipped with modern technology. The complex has a designed capacity of 250,000 cars, and 500,000 electric vehicles each year in the first phase.

 
 

Other News

.
Nine more expressway contractors suspected of construction violations
Nine more expressway contractors suspected of construction violations
BUSINESSicon  05/07/2020 

Nine more former contractors have been accused of irregularities in the construction of a 139-kilometer-long expressway whose severe deteriotion was reported shortly after its opening in central Vietnam.

VASEP decries taxes on semi-processed and processed seafood
VASEP decries taxes on semi-processed and processed seafood
BUSINESSicon  05/07/2020 

Tax agencies have slapped many firms with a corporate income tax on semi-processed seafood products at 20%, while their products for exports or domestic consumption that are mainly processed, 

Domestic property market faces uncertainty
Domestic property market faces uncertainty
BUSINESSicon  05/07/2020 

The domestic real estate market is hoped to have growth in the fourth quarter of this year and before the Lunar New Year 2021 if, by this year-end, the domestic economy is restored to levels from before the COVID-19 pandemic.

Hanoi moves towards approving construction of third Aeon Mall
Hanoi moves towards approving construction of third Aeon Mall
BUSINESSicon  05/07/2020 

The proposed construction of a parking lot and the Aeon Mall Hoang Mai Trade centre will soon be decided upon by the Hanoi People's Committee as Prime Minister Nguyen Xuan Phuc has approved the adjustment of the city's construction planning.

Pork and oil prices key to keeping inflation in VN under control: experts
Pork and oil prices key to keeping inflation in VN under control: experts
BUSINESSicon  05/07/2020 

With huge inflation pressure on the way in the remaining months of this year, a close watch must be kept on the prices of key products like oil and pork to hit the goal of keeping inflation below 4 per cent, experts have said.

US firms create record 4.8 million jobs in June
US firms create record 4.8 million jobs in June
BUSINESSicon  03/07/2020 

The reopening of businesses has spurred job growth but a rise in Covid-19 cases may hamper recovery.

Chubb Life Vietnam honored “Best Companies to Work for in Asia 2020”
Chubb Life Vietnam honored “Best Companies to Work for in Asia 2020”
BUSINESSicon  03/07/2020 

Chubb Life Vietnam has been recognized as one of the “Best Companies to Work for in Asia 2020” by HR Asia, the continent’s leading publication for Human Resources professionals.

VN government to sell stake in country’s biggest brewery
VN government to sell stake in country’s biggest brewery
BUSINESSicon  03/07/2020 

The Government will sell its 36% stake, equivalent to 230.8 million shares worth some VND37.6 trillion (US$1.6 billion), in the Saigon Beer-Alcohol-Beverage Corporation (Sabeco), the country’s biggest brewery, this year.

Fabric production an issue for Vietnam's textile industry
Fabric production an issue for Vietnam's textile industry
BUSINESSicon  03/07/2020 

Fabric production is a challenge for Vietnam's textile and garment industry when it comes to free trade agreements (FTAs) requirements on product origin.

Vietnam's FDI inflows to increase
Vietnam's FDI inflows to increase
BUSINESSicon  03/07/2020 

A new wave of foreign direct investment driven by global uncertainty such as the US-China trade war and the COVID-19 pandemic is imminent in Vietnam, 

Predatory debt collectors hustling on borrowed time
Predatory debt collectors hustling on borrowed time
BUSINESSicon  02/07/2020 

Debt-collecting businesses are to be banned in Vietnam as part of local government action to protect customers’ rights, with the upsurge of predatory lending services triggering heated debate and eroding public trust.

Vietnam draws up roadmap to eliminate monopoly in power sector
Vietnam draws up roadmap to eliminate monopoly in power sector
BUSINESSicon  06/07/2020 

A solution for the power industry has been put into discussion: selling entire power plants to investors after they are put into operation.

Proposal steers sports betting to starting line
Proposal steers sports betting to starting line
BUSINESSicon  03/07/2020 

A proposed national steering committee is expected to help Vietnam build clearer prize-winning entertainment rules and set up closer connections between government authorities and investors 

State Audit of VN notes high pay for foreign specialists in ODA projects
State Audit of VN notes high pay for foreign specialists in ODA projects
BUSINESSicon  05/07/2020 

A foreign specialist in an ODA (Official Development Assistance) project can receive VND500-700 million a month, while pay for a Vietnamese specialist is just tens of millions of VND.

EVFTA will broaden skies for aviation across Vietnam
EVFTA will broaden skies for aviation across Vietnam
BUSINESSicon  03/07/2020 

Never-before-seen activities in Vietnam’s aviation sphere are expected to come to EU businesses soon on the back of the landmark EU-Vietnam Free Trade Agreement.

RCEP benefits on horizon for ASEAN
RCEP benefits on horizon for ASEAN
FEATUREicon  02/07/2020 

With the Regional Comprehensive Economic Partnership scheduled to be signed this November, doors will soon open to attract more investment and swell Vietnam’s trade with international partners.

An abundance of advantages to diversify ops into Vietnam
An abundance of advantages to diversify ops into Vietnam
BUSINESSicon  02/07/2020 

Amidst the new wave of foreign investment and relocation after the pandemic, director general of the Foreign Investment Agency Do Nhat Hoang explained Vietnam’s outstanding advantages and how it can seize arising opportunities.

Vietnam closes in on tech app tax avoiders
Vietnam closes in on tech app tax avoiders
BUSINESSicon  02/07/2020 

Apple and Google are once again under fire over tax avoidance in Vietnam, with none of their revenues from their app markets being retained in the country. However, a new law could soon enable local authorities to take their cut.

Drugmakers fight to attain approval
Drugmakers fight to attain approval
BUSINESSicon  02/07/2020 

Switzerland’s drug maker Novartis Pharma Services AG has announced a GMP qualification for Lek Pharmaceuticals d.d. within the scope of certification for medicines in Vietnam,

PouYuen lays off thousands  due to Covid-19 difficulties
PouYuen lays off thousands due to Covid-19 difficulties
BUSINESSicon  02/07/2020 

More than 6,000 workers of the Taiwanese company, PouYuen, in HCM City have been laid off due to the company's business difficulties during the Covid-19 pandemic.

 
 
 
Leave your comment on an article

OR QUICK LOGIN