BUSINESS NEWS HEADLINES MARCH 14

Textile and garment firm sets higher earnings targets for 2020

BUSINESS NEWS HEADLINES MARCH 14

The Century Synthetic Fiber Corporation (HoSE: STK) is targeting a 9-13 per cent annual increase in total revenue and post-tax profit for 2020.

Revenue and post-tax profit in 2020 are expected to reach VND2.56 trillion (US$110.3 million) and VND235 billion, respectively.

The company last year earned VND2.23 trillion in total revenue, down 7.4 per cent on-year.

Post-tax profit jumped a fifth to a record high of VND214.5 billion in 2019.

The company also plans to pay a 15 per cent cash dividend, meaning every shareholder will receive VND1,500 per share.

STK also wants to issue 3.54 million new shares at a rate of 100:5 to increase charter capital.

It means each shareholder will have five new shares for every 100 shares they have.

Charter capital is expected to reach VND743 billion after the issuance.

The company will hold its annual shareholders’ meeting on March 26 in HCM City to discuss these issues.

STK has more than 70.7 million shares on the Ho Chi Minh Stock Exchange.

Its shares tumbled 6.9 per cent to end Thursday at VND14,250.

The company has lost a total of 25 per cent since February 25.

Vinawaco plans to sell State capital to settle Vietcombank debt

The Waterway Constructions JSC - Vinawaco plans to offload State shares to pay a debt owed to the country's largest lender by market capitalisation, Vietcombank.

Vinawaco borrowed VND12.59 billion (US$1.15 million) in 1995 from the Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank) to buy three ships from the State-owned Vietrancimex.

Vietrancimex was a State-owned shipping company and the deal aimed to help it tackle financial difficulties.

After acquiring the ships, Vinawaco suffered cumulative losses and almost had to declare bankruptcy. The company was then equitised in 2013 and the State capital was cut to 36.62 per cent in September 2016.

In the same month, Vietcombank asked Vinawaco to pay a debt worth VND53.1 billion, which included the initial loan worth VND12.59 billion, interest and late-payment penalties.

The lender’s demands came unexpectedly for the company, its strategic investors and shareholders, according to Vinawaco Chairman Ngo Van Tuan.

Prior to Vietcombank’s request, Vinawaco had removed the debt and interest from its accounting records since 2005 as it misunderstood requests made by the Prime Minister and the State Bank of Viet Nam about the ships during the equitisation progress.

So the valuation of Vinawaco did not include Vietcombank’s loan and interest.

The problem between Vietcombank and Vinawaco worsened when the latter said it would not pay the debt because it had not recorded it in financial reports and corporate valuation records.

In addition, Vinawaco had not completed its switch to a joint-stock company from a State-owned enterprise as it had not obtained confirmation from State agencies.

To settle the dispute, the Ministry of Transport has asked the Prime Minister's permission to hand over Vinawaco and its assets to the State Capital Investment Corporation (SCIC), which include Vietcombank’s debt. The SCIC would then have to sell part of the State capital at Vinawaco to settle the debt with Vietcombank.

Since Vietcombank’s debt was reported, Vinawaco has discovered 14 other outstanding loans worth VND137 billion after reviewing financial reports of seven subsidiaries.

Those debts were neither recorded in the corporate valuation when the firm was equitised nor valued accurately. Vinawaco has come up with solutions to settle the debts with other lenders. 

VN tech start-up incubator links up with Swiss Entrepreneurship Programme

UpStar Labs, the start-up incubation and investment arm of KMS Technology, has entered into a strategic partnership with the Swiss Entrepreneurship Programme.

Swiss EP will help UpStar Labs improve its incubation framework and support its product teams through its global network of experienced start-up mentors and entrepreneurs.

The two also plan to organise start-up and product development events and workshops to benefit the start-up community in HCM City.

UpStar Labs builds software products using Vietnamese engineering talent and invests in start-ups in the US and Việt Nam.

KMS Technology is a tech company with more than 1,200 employees in six offices in the US and Việt Nam.

The company has incubated a number of successful products since 2011, including QASymphony, one of the leading agile testing tools in the world, Kobiton, a mobile testing platform that recently raised US$5.2 million and has over 500 enterprise customers including Office Depot, Frontier Airlines and Capgemini, and Katalon, a leading test automation platform with over 300,000 users.

Swiss EP, funded by the Swiss Government, was launched in 2015 to strengthen emerging entrepreneurial eco-systems to drive job creation and facilitate sustainable economic growth.

With a presence in seven countries, Swiss EP has been recognised as a leading organisation in providing support for key drivers of entrepreneurship eco-systems. 

PetroVietnam rolls out measures to cope with COVID-19 and oil prices

PetroVietnam is implementing urgent tasks to cope with the double impact of the COVID-19 epidemic and the declining oil prices.

On March 11, 2020, PetroVietnam starts implementing Directive No.1151/CT-DKVN on the implementation of urgent tasks and solutions to cope with the dual effects of the COVID-19 epidemic and falling oil prices.

Facing the complicated situation of the COVID-19 epidemic and the fluctuations of the oil market, PetroVietnam’s management board had issued Directive 1151 to require the entire group’s staff and its affiliates to actively capture and update market information on supply and demand and the price of crude oil and petroleum products in order to build up specific plans and operating scenarios to fit any turn of events.

Coping with the sharp decline of oil prices since March 9, PetroVietnam is preparing a short-term plan for a long-term reduction in price, with scenarios for different price levels ($30, $40, $45, and $50 per barrel).

Subsidiaries and affiliates of PetroVietnam were assigned to compile scenarios and detailed solutions, even for the worst case scenario of prices crashing further.

The group will also focus on business activities while cutting off meetings and conferences, cutting costs and saving expenses by applying new technologies and improving labour efficiency. Especially, the group has compiled a set of solutions to prevent COVID-19 from spreading to oil fields and manufacturing sites.

2020 is the fifth year that PetroVietnam implemented the Vietnam Oil and Gas Industry Development Strategy to 2025 with orientation to 2035.

In January, PetroVietnam reported having surpassed many of its monthly targets, including revenue and state budget contributions. Its total revenue reached VND66.3 trillion ($2.88 billion), up 16.2 per cent against the monthly target, while contribution to the state budget hit VND8.3 trillion ($360.87 million), exceeding the goal by 17 per cent.

Meanwhile, PetroVietnam’s oil and gas exploitation increased 8.5 per cent against the monthly plan. It produced 147,300 tonnes of fertiliser and more than 1.2 million tonnes of fuel, surpassing the targets by 2.5 and 5.3 per cent, respectively.

Income tax threshold may increase

The Ministry of Finance has proposed raising the threshold for personal income tax, Tuổi trẻ (Youth) online newspaper has reported.

Under the proposal, people with an income of at least VNĐ11 million (US$476) per month will have to pay personal income tax, increasing from the previous level of VNĐ9 million ($389).

In addition, if a person has a child or a dependent, they will only have to pay personal income tax when they have a monthly income of at least VNĐ15.4 million ($666) instead of VNĐ13.4 million ($579) as before.

Phạm Đình Thi, head of the ministry’s Tax Policy Department said the proposal came after the ministry saw the fluctuation of the Consumer Price Index (CPI) between 2013 and 2019.

Thi said according to data of the General Statistics Office, the CPI, which was calculated at the end of December, had increased about 23.2 per cent from the CPI in July 2013. The adjustment was expected to reduce the financial burden on taxpayers and motivate them to work harder.

He added that the ministry was receiving comments from individuals, organisations and experts on the proposal.

The proposal will be submitted to the Government and the National Assembly Standing Committee for approval after the ministry considered the comments, he said.

It is estimated the State budget would lose about VNĐ10 trillion ($432 million) annually if the proposal takes effect.

Cao Ngọc Tuyến, an employee of a Hà Nội-based bank, said she applauded the proposal.

However, Tuyến said a person with a child or a dependent should only pay personal income tax when they made at least VNĐ17 million ($735) per month, as the cost of raising a child and tuition to send a child to school reached about VNĐ6 million ($259) a month, she said.

Nguyễn Đức Nghĩa, head of HCM City’s Tax Agency Club, said the ministry used the CPI last year to calculate taxable income for the coming years.

It was believed to be unsuitable with reality, he said.

The ministry was advised to re-calculate to adjust taxable income, he said.

Project on growing, processing and export chain for Bình Thuận dragon fruit

The Việt Nam Cooperative Alliance had a meeting with the People's Committee of the south-central province of Bình Thuận on the development of growing, processing and exporting in the province by 2025.

The project is developed by the Việt Nam Cooperative Alliance (VCA), the provincial people's committee and the Lavifood Joint Stock Company to contribute to the sustainable development of the dragon fruit production chain.

It also targets to improve economic efficiency for businesses, cooperatives and businesses, while increasing competitiveness and expanding dragon fruit consumption in Bình Thuận Province.

The Ministry of Agriculture and Rural Development has identified dragon fruit as the first among 11 fruits with competitive advantage in Việt Nam.

Nguyễn Ngọc Bảo, VCA chairman, said that nowhere was there a large dragon fruit growing area like in Bình Thuận Province.

“This is a great advantage to build a chain of planting, processing and exporting dragon fruits,” he said.

However, in order to implement the project effectively, Bảo asked the province to speed up mechanisation and application of technical advances in dragon fruit production; ensure infrastructure such as electricity, water and roads for fruit production areas.

The province needed to focus on producing organic dragon fruit and developing a production roadmap to meet the needs of market diversification, he added.

Bình Thuận had more than 30,600 hectares of dragon fruit with an output of more than 640,000 tonnes last year, said Phan Văn Tấn, deputy director of the provincial Department of Agriculture and Rural Development.

The province had more than 10,300 hectares and 450 packing facilities meeting VietGAP standards and seven units were granted certificates of safe dragon fruit production under GlobalGAP standards with an area of ​​about 387 hectares by last month.

The province currently has 35 cooperatives and one cooperative alliance producing dragon fruits.

Bình Thuận dragon fruit has been exported to 17 countries such as India, China and Malaysia.

After the meeting, the VCA and relevant agencies will submit to the Prime Minister and ministries and branches to resolve difficulties and problems regarding mechanisms and policies to support and promote sustainable development of a dragon fruit production chain.

Ministry asks for lower pork prices

Minister of Agriculture and Rural Development Nguyen Xuan Cuong said that the ministry would ask 17 big animal husbandry companies to reduce pork prices to reasonable levels.

Cuong stressed this during a trip to check pig reproduction in the northern province of Phu Tho on Tuesday.

He pointed out that some big companies were selling live hog at VND75,000 (US$3.2) per kilo, at which level they already were making large profits. In some retail spots, live hog prices were even higher.

According to Nguyen Xuan Loc, head of the management board of Ha Nam cattle and poultry wholesale market, said that live hog prices were on a downward trend in recent days after hitting a record of VND90,000 per kilo in early March in the northern region. In the market, hog prices were currently at around VND79-84,000 per kilogramme.

Pork prices were pushed up mainly due to scarcity caused by African swine fever in 2019. Recently, the novel coronavirus outbreak also affected pork prices as consumers raced to store food over fears of the epidemic.

“There is room to further lower pork prices,” Cuong said, stressing that it was a must to bring pork prices to reasonable levels so as to promote the sustainable development of the husbandry industry.

Cuong said that the ministry would ask big husbandry companies which played significant roles in the market to lower pork prices.

He also said that the African swine fever was already wiped out in 98 per cent of communes nationwide and now the focus should be placed on pig reproduction.

Cuong also urged farmers and husbandry companies to comply with bio-safety standards in pig raising to prevent the diseases and ensure product quality.

Prime Minister Nguyen Xuan Phuc on Monday issued Directive No 12/CT-TTg to hasten measures to prevent and fight against diseases affecting livestock and poultry.

Cement producers face multiple problems

Cement producers in Viet Nam are facing a double challenge with domestic demand falling due to a slowdown in the property market and delays in transport infrastructure works and exports declining due to the Covid-19 epidemic.

Nguyen Quang Cung, chairman of the Viet Nam Cement Association, was quoted as saying by Dau Tu Bat Dong San (Real-estate Investment) magazine that demand in 2020 was expected to be huge before the troubles began.

While demand is low, competition in the cement industry is fierce, exacerbating the difficulties, he said.

The forecast had been for exports of around 34 million tonnes this year, but the epidemic has put paid to those hopes since China used to be the main clinker importer, he said.

Domestic sales in the first two months of this year were down 40 per cent year-on-year.

Cement and clinker exports in the period were down 30 per cent.

Cung said that his association had petitioned the Government, State Bank of Viet Nam and sectors for support to help the industry overcome the current difficulties.

It had sought cuts in taxes and bank lending interest rates, he said.

“In addition to the epidemic, the industry also faces many other challenges like high materials and energy costs and fierce competition.”

Last year the Ministry of Construction had forecast demand this year to be 103 million tonnes, with domestic consumption accounting for around 70 million tones, and it has yet to revise it.

Since the end of last year the industry has been struggling due to high costs, with many companies reporting a downtrend.

Bim Son Cement Joint Stock Company reported a 55 per cent year-on-year fall in profits in the last quarter to VND26.8 billion (US$1.2 million).

Vicem Hoang Mai Company reported an 11 per cent fall in revenues and a 53 per cent slump in profits.

Last year Viet Nam exported nearly 34 million tonnes of cement and clinker worth $1.4 billion, according to a report by the Ministry of Industry and Trade.

Demand for packaging paper expected to grow strongly

Demand for packaging paper was expected to grow 14-18 per cent over the next five to ten years, according to the Viet Nam Pulp and Paper Association (VPPA).

The Vietnamese paper market posted impressive growth last year, with exports reaching 1 million tonnes, up 23.6 per cent over the previous year.

Paper consumption was estimated at 5.4 million tonnes, up 9.8 per cent.

The booming trend of e-commerce and digital media would also lead to strong growth in packaging demand, said the VPPA.

Eco-friendly products made from paper had the potential for growth in the food packaging industry to replace disposable plastic products.

This was also in line with policies on environmental protection launched by the Ministry of Natural Resources and Environment.

At the same time, free trade agreements had provided an opportunity to export Vietnamese packaging and packaging paper to tax-incentive markets.

However, the Vietnamese paper industry also faced many challenges as domestic paper enterprises were mostly small-scale.

On the other hand, not many domestic enterprises were capable of producing high-class packaging, said the VPPA.

In order to meet the increasing demand, the paper industry had been forced to take measures to expand its scale.

A typical example was Lee & Man Viet Nam, which produces 420,000 tonnes per year, along with Vina Kraft with 500,000 tonnes per year and Chanh Duong with 550,000 tonnes per year, contributing nearly 50 per cent to domestic packaging paper production.

Lee & Man in Hau Giang has invested more than US$650 million in high-tech packaging paper production lines from recycled materials.

Lee & Man Viet Nam also received financial support from the parent group Lee & Man Hong Kong.

If capacity increased, the company could contribute to addressing the shortage of domestic packaging paper, and at the same time, contribute to the increased export turnover of the entire paper industry, Patrick Chung, Lee & Man General Director, told Nguoi Lao Dong (Labourer) online newspaper.

However, to ensure a balance between production and environmental safety, paper businesses must invest properly in waste treatment, he added.

The company had put into operation a 24-hour monitoring system and invested VND20 billion ($862,070) in noise, odour and wastewater treatment systems, he added.

In the context of increasing demand, leading enterprises could expand production to solve the supply-demand problem, and develop the Vietnamese paper industry toward modernisation, he said.

Property firm projects revenue to jump 3.5 times in 2020

Property developer LDG Investment JSC hopes its total revenue in 2020 will jump 3.5 times from 2019's figure to VND2.75 trillion (US$119.3 million).

Post-tax profit is forecast to rise by 16 per cent year-on-year to VND700 billion.

The company in 2019 earned VND785 billion in total revenue, down more than 50 per cent year-on-year.

The figure was equal to 24 per cent of the full-year plan.

The company managed to accomplish the profit target of VND603 billion set for 2019 and recorded a lot of income from selling financial assets, worth VND502 billion.

The figure soared from 2018's figure of VND60 billion.

LDG Investment plans to pay a cash dividend at the rate of 7 per cent, meaning every shareholder will receive VND700 apiece.

The company will hold its annual shareholders’ meeting on March 19. The list of participants will be finalised on March 14.

 

LDG Investment shares (HoSE: LDG) tumbled 7.0 per cent to end Monday at VND6,900 per share.

Coronavirus to take global oil demand down a peg

The coronavirus crisis is affecting a wide range of energy markets – including coal, gas, and renewables – but its impact on oil markets is particularly severe because it is stopping people and goods from moving around, dealing a heavy blow to demand for transport fuels.

This is the main content of the latest oil market forecast released by the International Energy Agency (IEA). Global oil demand has been hit hard by the novel coronavirus (COVID-19) and the widespread shutdown of China’s economy.

The IEA now sees global oil demand at 99.9 million barrels a day in 2020, down around 90,000 barrels from 2019. This is a sharp downgrade from the IEA’s forecast in February, which predicted that global oil demand would grow by 825,000 barrels a day in 2020.

The short-term outlook for the oil market will ultimately depend on how quickly governments move to contain the coronavirus outbreak, how successful their efforts are, and what lingering impacts the global health crisis has on economic activity.

To account for the extreme uncertainty facing energy markets, the IEA has developed two other scenarios for how global oil demand could evolve this year. In the more pessimistic case, global measures fail to contain the virus and global demand falls by 730,000 barrels a day in 2020. In the more optimistic case, the virus is contained quickly around the world and global demand grows by 480,000 barrels a day.

The impact of the coronavirus on oil markets may be temporary but the longer-term challenges facing the world’s suppliers are not going to go away, especially those heavily dependent on oil and gas revenues, according to the IEA.

The medium-term market report also considers the impact of clean energy transitions on oil market trends. Demand growth for gasoline and diesel between 2019 and 2025 is forecast to weaken as countries around the world implement policies to improve efficiency and cut CO2 emissions – and as electric vehicles increase in popularity.

The impact of the energy transition on oil supply remains unclear, with many companies prioritising short-cycle projects for the coming year.

For Vietnam, falling world prices and demand would slash the budget, but it could potentially boost consumer spending and help businesses trim costs, which may in turn stimulate local consumption and production.

More generally, Vietnamese officials have emphasised that the country is now much less reliant on oil exports for revenue than it was before, with the current less than 10 per cent a far cry from the previous 20-25 per cent rate.

Two-month budget revenue increases by 9.3%

The total State budget revenue in the first two months this year reached VND276.7 trillion (US$11.8 billion), equalling 18.3% of the estimate and up 9.3% over the same period last year.

According to the Ministry of Finance, the accumulation of domestic revenue during the two-month period reached VND233.2 trillion, equalling 18.4% of the estimate, up 12.8% over the same period in 2019. Of this, revenue from crude oil was VND11.2 trillion, equal to 31.9% of the estimate, up 44.4% year on year.

Due to the impact of the new coronavirus disease (COVID-19), import-export turnover growth momentum in the first two months has slowed, revenue from import-export activities reached VND48.2 trillion, equalling 14.3% of the estimate and down 10.8% over the same period last year.

The total State budget expenditure during the Jan-Feb period was at about VND220.6 trillion, equal to 12.6% of the estimate, up 11.5% over the same period in 2019. Of this, the development investment expenditure reached VND34.7 trillion, interest payments at VND25.5 trillion, and regular expenditure approximately VND160 trillion.

Regarding developmental investment expenditure, from the total capital plan for 2020 (assigned by the Prime Minister at VND470.6 trillion), by February 28, the allocated capital to the central level reached 77.3% of the assigned plan, while the figure for the local level reached 98.3%. The disbursement progress during the last two months reached over 10% of the estimate, double the same period’s figure in 2019 (both in progress and implementation level).

To combat the COVID-19 epidemic, the central budget appropriated VND517.7 billion of the reserves in 2020 to supplement the Ministry of Health’s disease prevention and control activities.

In addition, the Ministry of Finance has granted over 12,700 tonnes of rice from the national reserve as relief to assist localities hit by natural disasters during the inter-crop period in early 2020.

Ben Tre speeds up land clearance for Japan’s water management project

The Mekong Delta province of Ben Tre is speeding up land clearance for the implementation of a water management project funded by the Japan International Cooperation Agency (JICA).

The project worth over 6.1 trillion VND (261.4 million USD) aims to prevent saltwater intrusion caused by climate change, according to Vice Chairman of the provincial People’s Committee Nguyen Huu Lap.

It is carried out in Chau Thanh, Binh Dai, Giong Trom, Mo Cay Bac, and Mo Cay Nam districts, and Ben Tre city, he said.

The main goal is strengthening the protection and use of water resources for agricultural production and lives of people in the target areas without being threatened by saline intrusion due to climate change and the overexploitation of water in the upstream part of the Mekong River, he added.

The project is expected to benefit a total of 207,275 households in the province./.

Hanoi’s poverty rate sharply declines

The rate of poor households in Hanoi has drop to 0.42 percent in early 2020 from 3.64 percent in 2016.

With this outcome, the capital has fulfilled its poverty reduction goal two years ahead of schedule.

At present, Hanoi counts 8,754 poor households.

As of the end of 2019, the city arranged over 8.5 trillion VND (366.6 billion USD) from its budget to implement poverty reduction programmes such as generating jobs, building new-style rural areas, and paying health insurance for poor and nearly-poor people.

From 2016 to 2019, the People’s Committees at the grassroots level sourced investment from local budget, individuals and organisations to support 7,165 needy households to build and upgrade houses./.

Agricultural production needs a boost amid COVID-19: conference

Minister of Agriculture and Rural Development Nguyen Xuan Cuong has ordered the farming sector to ensure stable supply for domestic consumption and prevent food price gouging.

Speaking at a tele-conference in Hanoi on March 12, the minister pointed to major challenges facing the sector, including impacts of COVID-19, extreme weather patterns like hailstones, drought and saline intrusion, and diseases among livestock and poultry.

In such circumstances, the sector needs to step up production while implementing measures to cope with diseases, he stressed.

According to the minister, after the epidemic is extinguished, there will be a consumption boom, so the sector should make preparations to catch the opportunity to promote growth and exports.

He instructed localities to restore pig raising as up to 99 percent of communes are now free from African swine fever, striving for the production of 5.6-5.8 million tonnes of pork this year.

Regarding exports, Cuong said the Ministry of Agriculture and Rural Development will continue coordinating with the Ministry of Industry and Trade and Vietnamese embassies in foreign countries to hold trade promotion events in major and promising markets.

He informed that ministries, agencies and businesses will join hands to regain foothold in the Chinese market in the time ahead, and seek ways to ship more products to the neighbouring country.

According to Nguyen Van Viet, head of the MARD’s Planning Department, rice output is expected to reach 28 million tonnes this year that can meet both domestic consumption and export demand of about 6.5-7 million tonnes.

Meanwhile, vegetable production is projected at 18.2 million tonnes, up 5 percent year-on-year; fruit at around 13.3 million tonnes, up 6 percent; and aquatic products at 8.5 million tonnes, up 4.4 percent. /.

Hanoi seeks to promote economic growth despite COVID-19 outbreak

Hanoi is seeking to fulfill socio-economic targets in 2020 amid the complicated and unpredictable developments of the acute respiratory disease caused by SARS-CoV-2 (COVID-19).

At a meeting in the city on March 12, Secretary of the municipal Party Committee Vuong Dinh Hue said while the top task at present is to contain the COVID-19 outbreak, another important mission is to prevent the decline in economic growth.

The Party board of the municipal People’s Committee reported that tourism is hardest hit due to strong declines in the numbers of visitors from three main markets - China, the Republic of Korea (RoK), and Japan where the virus is raging through. Tourists from the three markets make up 37 percent of the total number of foreigners to Hanoi.

Industrial production also suffered when 15 percent of exports and 50 percent of imports depend on China and the RoK.

Investment from Japan, the RoK and China, which accounts for 41.5 percent of the total foreign investment in Hanoi, is forecast to decline.

On the other hand, agriculture expects a 3 percent growth. The production of medical supplies and health products as well as the pharmaceutical industry are also forecast to post high growth.

Besides, the wave of shifting investment out of China due to the epidemic and the China-US trade tension is also an opportunity for Hanoi.

Based on the outcomes in January-February, Hanoi has drafted three growth scenarios and selected the first one to strive for, under which, the city aims for a 7.51 percent GRDP growth in 2020 and 7.37 percent on average during 2016-2020.

The key solutions are well controlling the disease, promoting business production, and intensifying administrative reforms.

The city will also work to improve business and investment environment, remove difficulties for businesses, attract more investment, and speed up the implementations of major projects./.

Demand for packaging paper expected to grow strongly

Demand for packaging paper was expected to grow 14-18 percent over the next five to ten years, according to the Vietnam Pulp and Paper Association (VPPA).

The Vietnamese paper market posted impressive growth last year, with exports reaching 1 million tonnes, up 23.6 percent over the previous year.

Paper consumption was estimated at 5.4 million tonnes, up 9.8 percent.

The booming trend of e-commerce and digital media would also lead to strong growth in packaging demand, said the VPPA.

Eco-friendly products made from paper had the potential for growth in the food packaging industry to replace disposable plastic products.

This was also in line with policies on environmental protection launched by the Ministry of Natural Resources and Environment.

At the same time, free trade agreements had provided an opportunity to export Vietnamese packaging and packaging paper to tax-incentive markets.

However, the Vietnamese paper industry also faced many challenges as domestic paper enterprises were mostly small-scale.

On the other hand, not many domestic enterprises were capable of producing high-class packaging, said the VPPA.

In order to meet the increasing demand, the paper industry had been forced to take measures to expand its scale.

A typical example was Lee & Man Vietnam, which produces 420,000 tonnes per year, along with Vina Kraft with 500,000 tonnes per year and Chánh Dương with 550,000 tonnes per year, contributing nearly 50 percent to domestic packaging paper production.

Lee & Man in Hau Giang has invested more than 650 million USD in high-tech packaging paper production lines from recycled materials.

Lee & Man Vietnam also received financial support from the parent group Lee & Man Hong Kong.

If capacity increased, the company could contribute to addressing the shortage of domestic packaging paper, and at the same time, contribute to the increased export turnover of the entire paper industry, Patrick Chung, Lee & Man General Director, told Nguoi Lao Dong (Labourer) online newspaper.

However, to ensure a balance between production and environmental safety, paper businesses must invest properly in waste treatment, he added.

The company had put into operation a 24-hour monitoring system and invested 20 billion VND (862,070 USD) in noise, odour and wastewater treatment systems, he added.

In the context of increasing demand, leading enterprises could expand production to solve the supply-demand problem, and develop the Vietnamese paper industry toward modernisation, he said./.

PM orders acceleration of transport projects

The acceleration of investment disbursement for transport infrastructure projects is extremely important as the economy has been heavily affected by the COVID-19 epidemic, Prime Minister Nguyen Xuan Phuc said at a meeting of the Government’s standing board in Hanoi on March 12.

He singled out the component projects for the North-South and Trung Luong-My Thuan-Can Tho expressways, stressing that obstacles to those projects must be quickly removed.

The PM agreed with the solution of changing the form of investment from public-private partnership (PPP) to public investment for several urgent projects as proposed by the Ministry of Transport.

He assigned the ministry to coordinate with relevant ministries to make official reports about this issue for submission to authorised agencies, as well as ensure the implementation progress and quality.

PM Phuc urged the ministry to push the construction of My Thuan Bridge 2 connecting the Mekong Delta provinces of Tien Giang and Vinh Long for early completion.

Regarding the My Thuan-Can Tho expressway, the PM said this is an important route linking with the Trung Luong-My Thuan expressway which is scheduled to be inaugurated in 2021.

Therefore, the State will provide the best assistance for the implementation of this project, he affirmed./.

Port cargo volume records double-digit growth

Despite the falling number of ships arriving in Vietnamese ports as a result of the impact of the novel coronavirus (COVID-19), the volume of goods going through seaports has posted impressive growth.

Figures indicate that there has been approximately 6,790 cargo ships and boats entering and leaving Vietnamese seaports from or via China and other nations that have been hit by the outbreak of the COVID-19 as of early March.

The first quarter of the year has seen the number of cargo ships entering and leaving Vietnamese seaports, primarily from China, fall by approximately 15% in comparison with the same period last year.

Most notably, the number of cargo ships on the route between Quang Ninh and China suffered a drop of 48%.

The Vietnam Maritime Administration have stated that amid a decreasing number of ships arriving, the first two months of the year has seen the volume of goods passing through the nation’s ports grow with an estimated 95.7 million tonnes, a year-on-year increase of 10 per cent. Meanwhile, container volume is thought to stand at over 3.1 million twenty-foot equivalent units (TEUs), a rise of 14% on-year.

Seaports recording the highest increase in cargo volume include Can Tho which has enjoyed a 50% rise due to coal-fired power plants needing a large volume of coal for operation. In addition, seaports located in the central provinces of Quang Ngai, Quang Tri, and Thua Thien Hue have recorded rises of between 18% and 23%.

Despite these signs of growth, there remains some areas where the volume of goods passing through seaports has endured a slump. This can be seen in Quang Nam with a 72% drop, An Giang down 33%, Nam Dinh with a 36% fall, and Ho Chi Minh City down 18% annually.

In the context of complicated developments surrounding the COVID-19 outbreak the Vietnam Maritime Administration has been sending frequent documents to seaport authorities in a bid to co-ordinate closely with relevant agencies to control cargo ships and boats.

Moreover, special attention must be given to those either arriving from or heading to nations that have recorded large numbers of COVID-19 cases, most notably China, Japan, and the Republic of Korea.

As a result, cargo ships are now only allowed to operate in port areas after undergoing thorough checks and being confirmed by the health quarantine agency that they are free from any epidemic diseases.

Seaport authorities have been asked to work closely alongside medical quarantine centres, with a particular focus given to passenger ships arriving at ports in order to collect information from tour operators and help those on board conduct their health declarations before arriving at ports.

Japan helps Ben Tre to establish climate-resilient agricultural value chain

Japan will help the Mekong Delta province of Ben Tre to establish a climate-resilient agricultural value chain, said the Japan International Cooperation Agency (JICA) Office in Vietnam on March 12.

The JICA Office in Vietnam has signed a tripartite agreement with the Japan External Trade Organisation (JETRO) Office in Ho Chi Minh City and Ben Tre province which promotes cooperation in three specific areas – establishment of a climate-resilient agricultural value chain; improvement of investment environment and promotion of high quality investment in Ben Tre, particularly those by Japanese enterprises; and personnel training for agricultural development and investment promotion via Japanese cultural exchanges and language courses within the framework of JICA and JETRO’s programmes.

The JICA will actively implement results of ODA projects and surveys under the Japanese Enterprises Proposing Programme while the JETRO will provide support and information for Japanese firms investing in Ben Tre.

The JICA has been providing Ben Tre with both “structural” (infrastructure development under loan projects) and "non-structural" (policy and technical assistance) support, such as the “Ben Tre Water Management” loan project aiming to help the province tackle climate change issues, like saltwater intrusion and shortage of freshwater, by constructing water sluice gates and related facilities.

Under the framework of cooperation with the Vietnam Academy of Social Sciences (VASS), the JICA has also been providing Ben Tre with consultancy in formulating agriculture development policies.

In the near future, the JICA and JETRO will work as a bridge for information sharing between the parties and jointly promote investment and economic development in different provinces in Vietnam.

Ben Tre is known for an advantageous location for agro-fishery production such as coconut or shrimp farming. The province views agriculture as a key economic sector and also focuses on promotion of both domestic and foreign investment.

Compared to other provinces in the vicinity of Ho Chi Minh City, Ben Tre also has great potential with abundant and low-cost human resources and is one of the provinces providing a large pool of apprentices for Japan.

US remains largest buyer of Vietnam’s tra fish

Vietnam’s tra fish exports to the United States in the first two months of the year totaled US$18.1 million, making the United States the largest buyer of Vietnamese tra fish, with exports expected to rise as US consumers seek to stock up on food during the coronavirus scare.

China's imports of tra fish from Vietnam have plunged 50% due to COVID-19.

The country recorded sharp declines in tra fish exports to most overseas markets during the January-February period, especially for the Chinese market as COVID-19 has disrupted goods trading and logistics activities between Vietnam and China, accorditonng to the Ministry of Agriculture and Rural Development.

Despite the impact of the disease on trading activities, the Vietnam Association of Seafood Exporters and Processors (VASEP) forecast that tra fish exports to the United States may rise in the coming months.

VASEP reasoned that the consumption of aquatic products, including tra fish, has increased steeply in the United States partly because people there are stocking up on food to cope with the outbreak of the new coronavirus, which has been declared a pandemic by the World Health Organization (WHO).

Further, the United States’ import volume of tra fish tumbled in 2019 and thus its inventories ran out, urging tra fish buyers to ramp up purchases of the fish this year.

According to VASEP, last year, Vietnamese tra fish did not benefit from the US-China trade war as expected, even though the United States’ imports of China’s tilapia, whose competitiveness is equivalent to tra fish, fell significantly.

The United States imposed antidumping tax on tra fish, and its final decision approving the quality compatibility of Vietnamese tra fish was made later than expected, stated VASEP.

Specifically, Vietnam’s export value for tra fish to the United States maintained a downward trend for 11 consecutive months in 2019 compared with exports in 2018.

Later, the US Department of Agriculture officially approved the compatibility of Vietnamese tra fish standards with its own late last year. This allowed Vietnamese tra fish to be shipped to more overseas markets.

Moreover, the European Parliament in February ratified the European Union-Vietnam Free Trade Agreement. The move is expected to open up more opportunities for local exporters to boost their tra fish shipments to the European Union when import tariffs on tra fish are dropped to 0% in the next three years.

Although bright prospects were anticipated for the country’s tra fish exports, experts still advised tra fish farmers to actively lower production to bring this year’s figure to 1.2 million tons, down 10% year-on-year.

HCM City price-stabilisation programme includes more drugs

As many as 4,279 drugstores are selling drugs that are included in HCM City's price-stabilisation programme for the 2019-20 period, according to the city's Department of Health.

The figure accounts for nearly 75 per cent of the total number of retail drugstores in the city.

Eleven pharmaceutical companies take part in the programme.

Of the medicine offered, 20 kinds of drugs are produced in the country’s factories meeting World Health Organisation’s good manufacturing practices, including 176 active elements and 332 drugs used for chronic diseases.

The prices are at least 5 per cent to 10 per cent lower than others of the same type in the market. From April last year to early March, turnover from these drugs had reached nearly VNĐ61 billion (US$2.6 million).

According to the department, the drugs included in the programme meet essential health need and are often prescribed and provided by health facilities and pharmaceutical companies taking part in the programme.

The department will continue encouraging pharmaceutical enterprises to increase investment in their facilities to improve the quality of medicine included in the programme.

It has also encouraged enterprises to distribute the drugs more widely and has urged doctors to prescribe medicine included in the programme.

The programme started in 2011 with only four pharmaceutical companies. 

 
 

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