VIETNAM BUSINESS NEWS MARCH 22

Ho Chi Minh City eyes $108 billion in exports by 2030

VIETNAM BUSINESS NEWS MARCH 22

Ho Chi Minh City is striving to earn 70 billion USD in export turnover by 2025 and 108 billion USD by 2030, and maintain an average annual export growth of 9 percent during 2026-2030.

The municipal People’s Committee sets the targets at its recently-approved plan on developing export by 2025, with a vision to 2030.

To that end, from now to 2025, the city will maintain and support the development of its key products, while making preparations to upgrade industry and participate more deeply in global value chains, and focusing on developing electronics, mechanics, and wood products, which it considers a foundation for its export growth in the time ahead.

In addition, the city will upgrade infrastructure serving export, and at the same time reform and increase the quality of public services directly related to import-export activities with the aim of providing the best possible services.

By 2030, the city will build strategies to improve competitiveness of its outstanding export products such as electronics, mechanics, optics, software, and service exports such as finance, tourism and logistics.

It will also attract more investment in finance, banking and logistics, and form logistics service centres, and step up human resources development.

Last year, the largest economic hub of Vietnam earned over 40 billion USD from exports./.

Analysts see profit-taking as VN-Index hovers around 1,200 points

The market experienced a thrilling week as the VN-Index successfully peaked the historic high of 1,200 points after volatile sessions.

However, the index fell under the level in the next session, which was also the last trading day of the week, on selling pressure. The move makes analysts not so optimistic about the coming week.

The market benchmark VN-Index on the Ho Chi Minh Stock Exchange (HoSE) ended last week at 1,194.05 points after hitting 1,200.94 points last Thursday.

For the week, the index rose 1.06 per cent.

Analysts from SSI Securities Corporation (SSI) said that despite the fall of the VN-Index in the last session, trading volume showed weaker-than-expected selling pressure meaning the index could get back to the resistance level of 1,200 points in the next sessions.

Viet Dragon Securities Corporation (VDS) also shared the opinion.

“The loss of the last session is just a small correction and the upward trend is still there. Many stocks are thriving, as well as on track to reach higher targets. Investors can focus on sectors with positive signs to invest more effectively,” the securities firm recommended.

According to MB Securities Co., the drop was partly due to portfolios restructuring of two ETFs, including FTSE ETF and V.N.M ETF.

And the break over 1,200 point-level also created profit booking activities. Some investors might take long positions under technical signs, while others might take profits.

However, volatile amplitude in correction sessions was narrow and the market’s liquidity stayed high which was a positive sign. It is possible that the market might fluctuate in the next sessions, and if the bottom purchase demand is still high, the chance for recovery is coming soon, according to MB Securities.

Meanwhile, some took a more cautious view. BOS Securities Corporation (ART) said that the market couldn’t make a breakthrough in short-term with weaker cash flows. Technical indicators showed signs of fluctuation chances in the market.

“There is possibility that the VN-Index hovers around 1,200 point-level in the next sessions. Therefore, investors put priority in watching the market and consider to reduce shares proportion if the cash flows are weaker when the market gains points,” BOS Securities added.

Last week, the HNX-Index on the Ha Noi Stock Exchange (HNX) closed Friday’s trade at 277.7 points. For the week, the index climbed 1.38 per cent.

The liquidity on both exchanges slightly increased against the week before and was higher than the twenty-week average with a trading value of VND18.3 trillion per session.

Analysts from Saigon - Hanoi Securities JSC said that the gain in the liquidity was thanked to the portfolio restructuring activities, so the market’s current rally was not stable.

Information technology stocks posted the biggest gain in market capitalisation with an increase of 4 per cent. Of which stocks with outstanding performance were FPT Corporation (FPT), up 4.3 per cent, and CMC Corporation (CMG), up 7.1 per cent.

This was followed by the banking sector with a rise of 2.5 per cent in market capitalisation. Bank stocks posting big gains were VPBank (VPB), up 1.6 per cent, Asia Commercial Bank (ACB), up 2.6 per cent, MBBank (MBB), up 3.4 per cent and Vietinbank (CTG), up 6.6 per cent.

Other sectors like consumer services and industry also recorded good performance, up more than 1 per cent.

Finance, materials, oil and gas, pharmaceutical and health care, and consumer goods sectors increased 0.3 – 0.6 per cent last week. 

E-commerce – lifebuoy helping businesses overcome market fluctuations: workshop

E-commerce has created a new tendency for production, business and export activities, and been serving as a lifebuoy for many enterprises to overcome difficulties of market fluctuations, heard a workshop on Vietnam’s e-commerce trends on March 20.

The workshop was organised by the Junior Chamber International Vietnam (JCI Vietnam) in Ho Chi Minh City.

National President of JCI Vietnam Vo Quan Duy said that the workshop was the first event in the organisation’s Business Matching Programme 2021 (BMP21) established to create a multi-dimensional support platform for JCI Vietnam’s member businesses and to facilitate international trading.

According to statistics in January 2021, Vietnam’s e-commerce revenue grew 18 percent in 2020, hitting 11.8 billion USD and accounting for 5.5 percent of total retail sales of consumer goods and services nationwide.

Nguyen Thu Trang, Business Development Director at Atalink Technonoly JSC, stated that business-to-business e-commerce is a future trend and the e-commerce platform is assessed as highly effective by enterprises.

In fact, Trang went on, the number of businesses making orders via the e-commerce trading floor increases by 6 percent compared with traditional ones such as email or website.

Sharing the view, Nguyen Manh Tan, Marketing Director of Haravan Technology JSC, said that there is currently a trend of shifting traditional retail to multi-channel retail (both offline and online) and omni-channel retail.

Omni-channel retail is a multichannel approach to sales that focus on providing seamless customer experience whether the client is shopping online from a mobile device, a laptop or in a brick-and-mortar store./.

PM attends inaugural ceremony of Phuoc Dong Industrial Park and Port

Phuoc Dong Industrial Park and Port, an industrial zone located in the Southern Key Economic Region, was inaugurated in the Mekong Delta province of Long An on March 21 in the presence of Prime Minister Nguyen Xuan Phuc.

Speaking highly of the inauguration of the industrial park and port, which is expected to serve as a magnet to lure secondary investors, Prime Minister Phuc hailed Long An province’s efforts to develop industrial parks to create impetus for local socio-economic development in the past time, with gross regional domestic product (GRDP) registering an average annual growth of 9.16 percent during 2016-2020.

He laid a stress on the important role of businesses in the national economic development and job generation, asking the local authorities to continue support for the investors, help them remove bottlenecks in their business in the province, and work to further improve the investment climate with more effective measures in place.

He also ordered the province to promote its potential, and sharpen focus on branching out key industries, high-tech industry, supporting industry and logistics so as to improve local livelihoods.

It is necessary to upgrade transport infrastructure, enhance regional linkages with Ho Chi Minh City and other southern localities, he said, adding local socio-economic development must go with environmental protection.

PM Phuc particularly emphasise the need to pen a long-term development plan which enables Long An to make significant contributions.

Phuoc Dong Industrial Park and Port, 39 kilometres to Tan Son Nhat Airport, 19 kilometres to Long An International Port, and 42 kilometres to Cat Lai port, spans 128.8 hectares, including 92.39 hectares of industrial land, ready-built factories and warehouses. It is invested by IMG Investment JSC. The port system will be developed to welcome cargo ships with a capacity of 20,000 DWT in the coming time.

In the morning of March 21, PM Phuc hosted Consul Generals of the US, the Republic of Korea and India in Ho Chi Minh City, and leaders of multinationals GS Energy and Alibaba who are making investments in Long An province.

At the event, PM Phuc hailed the US, RoK and Indian diplomatic organisations’ interests in promoting foreign investment in Vietnam, particularly in the context that the global economy is facing formidable challenges caused by the COVID-19 pandemic.

He affirmed that the Vietnamese Government will persistently follow its dual goals of containing the pandemic and boosting economic development, and spare no efforts to better investment and business environment, creating favourable conditions for foreign firms to land investment in the country.

The diplomatic representatives said as more US, RoK and Indian firms have been keen on investing in Vietnam, they will come to the nation to seek cooperation opportunities right after international commercial fights are resumed. They thanked the Vietnamese Government and competent authorities for facilitating conditions for them to proceed investment in Long An province, and expressed their wish to engage further in production and investment activities in Vietnam./.

Quang Nam keen to whip tourism into shape

COVID-19 has been largely brought under control around Vietnam thanks to appropriate containment measures being adopted by the Government nationwide, and the Prime Minister has ordered the quick implementation of a vaccination programme to halt the pandemic and create the conditions necessary for socio-economic development.

After undergoing a long period of closure and stagnation, however, the financial resources of tourism industry players have run low and now, more than ever, they need assistance to recover and become a spearhead economic sector once more. Most tourism enterprises, travel agencies, and tourism service providers in central Quang Nam province agree with such sentiments.

“To improve and introduce travel products and services and stimulate tourism, we first need to focus on the domestic market,” said President of the Quang Nam Tourism Association Phan Xuan Thanh.

Quang Nam has established tourism as a spearhead economic sector, with the goal of attracting over 12 million visitors, with half coming from overseas. Tourism currently makes up over 5 percent of gross regional domestic product  and has created 30,000 jobs. By 2030, Quang Nam’s tourism sector will hopefully be the region’s spearhead economic sector, making up 7-8 percent of the GRDP and creating over 50,000 jobs.

The Quang Nam Department of Commerce and Tourism was established in 1997, paving the way for the tourism sector’s strong development in the province.

But it only really “boomed” after Hoi An ancient town and My Son Sanctuary were recognised as world cultural heritage sites by UNESCO in 1999.

Tourist numbers then increased dramatically, at an annual average of 20-25 percent, and attractive tourism models associated with islands, mountainous areas, community tourism, cultural tourism, other heritages, agricultural tourism, and craft villages also began to take shape.

Events such as “Old Quarter Night”, “Streets without engine noise”, “A day as a farmer”, and “Mỹ Sơn by night” also contributed to building Quang Nam’s tourism brand.

Besides the ever-popular Hoi An, Quang Nam also boasts lesser-known destinations well worth a visit./.

Nearly 3 million phishing attempts aimed at small businesses in region last year: Kaspersky

Cybercriminals actively attacked small and medium businesses in Southeast Asia last year, with the top topics they exploited being COVID-19, non-existent video conferences and new corporate services, according to global cybersecurity company Kaspersky.

It said its anti-phishing technology blocked a total of 2.89 million attempts aimed at SMBs, a 20 per cent increase from 2019.

Phishing is a form of cybercrime based on social engineering techniques that involves stealing confidential data from a person’s computer and subsequently using the data for other purposes ranging from stealing money to selling it.

Phishing messages usually take the form of fake notifications from banks, providers, e-pay systems, and other organisations, but can also be an almost 100 per cent perfect replica of a trusted website to which a victim is lured through phishing messages.

Indonesia registered the most incidents followed by Thailand and Việt Nam with over half a million attempts each. Malaysian, Filipino, and Singaporean SMBs were not spared, with these nations suffering a combined 795,000 attempts.

Yeo Siang Tiong, general manager for Southeast Asia at Kaspersky, said: “While they serve as the bedrock of our regional economy, SMBs are low-hanging fruits for cybercriminals. These malicious actors are aware that owners are focused on keeping their cash flow more than their cybersecurity, at least for now.

“Social engineering attacks such as phishing is also the easiest way in. Combining our current stressed minds with the right buzzwords like COVID-19, and now the vaccines, we expect to see this threat being used more to steal money and data from this already battered segment.”

Globally, online phishers exploited the COVID-19 theme, invited victims to non-existent video conferences and insisted that their targets register for “new corporate services.”

Given that the fight against the pandemic is not over yet, Kaspersky expects the main trends of 2020 to stay relevant in the near future.

An important trend that businesses in SEA, a region famous for being highly active on social media, should note is that phishing links and mails are being shared via online networking platforms, the company said.

Kaspersky experts observed that scammers who were spreading their chain mail via social networks and instant messaging applications began to favour the latter in 2020.

Message recipients were promised a discount or prize if they opened a link sent to them.

“It is true that governments and financial organisations are combining efforts to offer lifeboats for SMBs via grants and offers, but we have to accept that cybercriminals will spare no one,” Yeo said.

“Amidst the uncertainties, one thing I can say for sure is that building your IT security is always less costly than suffering a cyberattack.”

Criteria for identifying high-tech enterprises set from April

The prime minister issued Decision No.10/2021/QD-TTg providing criteria for identifying high-tech enterprises, effective from April 30.

Accordingly, revenue from high-tech products of these high-tech enterprises must be at least 70 per cent of the total annual net revenue of the enterprise.

These enterprises will have to reach a certain ratio of total expenditure on research and development (R&D) of the enterprise (including depreciation of investment in infrastructure, fixed assets, annual recurrent expenditures on research and development; expenses for training, training support for workers who conduct research and development, science and technology organizations, training institutions in Vietnam; fees of royalty, conveyance, the right to use industrial property objects in service of research and development activities; registration fees for recognition or protection of inventions, and utility solutions in Vietnam) per value of total net revenue minus input value (including the value of raw materials, components for import production and domestic purchase) annually.

For enterprises with a total capital of VND6 trillion($260.87 million) and a total of 3,000 employees or more, this ratio must be at least 0.5 per cent. Enterprises having a total capital of VND100 billion ($4.35 million) and a total of 200 employees or more must reach at least 1 per cent. Enterprises not falling into these two categories must reach at least 2 per cent.

In addition, high-tech enterprises also have to hit a ratio of employees who graduated from college or another higher education institution, vis-a-vis the total number of employees. These employees have to directly conduct R&D activities and have signed labour contracts for a term of one year or more, or contracts with indefinite terms. Workers with college degrees cannot exceed 30 per cent of the total workforce at high-tech enterprises.

For enterprises with a total capital of VND6 trillion and 3,000 employees or more, this must be at least 1 per cent. Enterprises having a total capital of VND100 billion and a total of 200 employees or more, must reach at least 2.5 per cent. Enterprises not falling into these two cases must reach at least 5 per cent. 

FDI firms enjoy US$5.5 billion in trade surplus in two months

Foreign direct investment (FDI) firms’ import-export value reached US$68.52 billion in the first two months of 2021, a surge of 31.5 per cent from the same period last year, according to the General Department of Vietnam Customs 

In January-February, the FDI sector enjoyed nearly $5.5 billion in trade surplus, with exports exceeding $37 billion, up 32 per cent year on year, while imports reached $31.51 billion, up 30.8 per cent.

Among sub-sectors, the machinery, tools and parts posted the largest export growth with 77 per cent, increasing $2.44 billion. It was followed by phones and spare parts ($2.2 billion, or 29 per cent), and electronics and parts ($1.85 billion, or 34 per cent).

As of February 20, $5.46 billion worth of FDI was injected into Vietnam, equivalent to 84.4 per cent of the figure recorded in the same time last year, according to the Ministry of Planning and Investment.

As many as 126 foreign projects were granted investment licences with total registered capital reaching $3.31 billion, a year-on-year decline of 33.9 per cent.

Meanwhile, 115 existing projects adjusted their investment capital with a total additional sum of $1.61 billion, or 2.5 times higher than the same time last year.

Capital contributions and share purchases by foreign investors stood at $543.1 million, down 34.4 per cent.

Foreign investors pumped capital in 17 sectors, with processing and manufacturing holding the lead with more than $3 billion or 55.7 per cent, followed by power production and distribution with $1.44 billion (26.5 per cent), real estate $485 million, and science-technology nearly $153 million.

Companies with exceptional business make good earnings

The number of unorthodox companies is increasing rapidly on the Vietnamese stock market, generating steady revenue and profit every year.

HaiPhong Funeral Services JSC (CPH), the only funeral service provider on the stock market so far, posts impressive business results with revenues of hundreds of billion Vietnamese đồng per year, earning some VNĐ300 million (US$13,000) of revenue per day.

CPH trades pots, caskets, stone tombs and other funeral products, as well as providing funeral, burial, cremation services.

In the company's gross profit structure, the sale segment accounts for about 80 per cent of the total gross profit. After-tax profit has been flat for many years with about VNĐ9 billion. Earning per share (EPS) is over VNĐ2,060 in 2020.

The company has paid dividend at a rate of 16 per cent to shareholders over the past four years. And due to maintaining a low transaction price of VNĐ3,500 per share at present, the price-to-earnings (P/E) is at the desired level at 1.7 times.

Another company which also serves in the spiritual realm is Yên Bái Joint Stock Forest Agricultural Products And Foodstuff Company (CAP). Few people know that this company produces and sell votive paper.

Votive paper segment accounts for 50 per cent of CAP’s total revenue, bringing about VNĐ200 billion in 2020. The rest of revenue comes from tapioca and cinnamon oil.

On the stock market, CAP shares have been rising continuously. Currently, CAP is trading at around VNĐ62,100 per share, doubling that of the beginning of 2020.

Thai-invested Siam Brother Vietnam (SBV), established in July 1995, manufactures ropes and fishing equipment. After nearly 30 years of operation, SBV is now the leading producer and supplier of fishing ropes in Việt Nam.

Despite the impact of the COVID-19 pandemic, revenue in 2020 grew approximately nine per cent compared to the previous year, to reach VNĐ5 trillion, post-tax profit increases by 19 per cent to VNĐ68 billion. EPS reached VNĐ2,485.

Charter capital of Siam Brothers Vietnam is approximately VNĐ273 billion at present, market price is around VNĐ13,000 per share. Market liquidity is quite stable with tens of thousands to hundreds of thousands of shares matched each session.

Thống Nhất Match Joint Stock Company (DTN), a match manufacturer, decided to leave the stock market last year after six years of trading. It sees revenue reaching over a hundred of billion đồng in recent years, particularly VNĐ133 billion in 2019. However, the annual profit touched only around VNĐ2-4 billion. It was even less than VNĐ1 billion in 2019.

During its listing, DTN shares were seeing almost no liquidity. Very few transactions were made, mostly internal transactions.

Before it left the trading floor in August 2020, there were some transactions with thousand of DTN shares matched. The stock price of DTN suddenly soared to VNĐ74,000 per share after these transactions. DTN closed the last session of trading on the stock exchange at the price of VNĐ62,900 per share.

Merufa Joint Stock Company (MRF), the only condom manufacturing company on the stock market, has been listed since December 2017.

Merufa, formerly known as the Medical Rubber Enterprise under the Ministry of Health, was built in co-operation between the Government of Việt Nam and the United Nations Population Fund in 1987. Since then, Merufa has been providing the market with contraceptive products made from natural rubber in Việt Nam with the brand HAPPY.

Not only condoms, Merufa is also a pioneer in researching and producing other important medical products such as surgical gloves, transfusion bottles made from synthetic rubber.

Merufa’s condom business has faced many difficulties recently as it has to compete with famous foreign brands.

In 2020, in the face of widespread COVID-19 pandemic, the demand for gloves in the market increased sharply, the company decided to invest in a second glove factory with a total investment of VNĐ230 billion.

In 2019, Merufa recorded nearly VNĐ108 billion in revenue, up 10.2 per cent from the previous year. The post-tax profit rose by 165 per cent to nearly VNĐ6.7 billion. EPS was VNĐ1,818.

Nam Hoa Toys (NHT) specialises in producing wooden toys for children, the only of its kind on the market at present. The company put its shares on the Upcom since December 2017.

NHT has also considered moving to list on the Hà Nội Stock Exchange (HNX), but the procedure has not yet completed.

Business results, revenue in 2020 suddenly quadrupled from 2019, reaching VNĐ887 billion and after tax profit increased 78 per cent, to over VNĐ78 billion, mainly thanks to the consolidated business results of its subsidiaries. 

Youth union helps young start-up businesses overcome difficulties

 

The COVID-19 pandemic has badly affected production and business activities, especially start-up businesses set up by young people.

To help young entrepreneurs overcome difficulties and stand firm during the pandemic, the Youth Union of Bắc Ninh Province has introduced several support solutions.

After graduating from university, Vũ Quang Đạo, 29, from Ngô Thôn Village, Xuân Lai Commune of Gia Bình District returned home and continued to volunteer in the military.

Leaving the army, and realising the potential of farming, Đạo decided to start up his own business. Local people were still farming in traditional ways, which were not very efficient.

With his family’s land stretching 7,000sq.m, Đạo used half of the area to dig a pond for fish and the rest was for growing fruit and raising livestock.

After receiving a VNĐ400 million (US$17,200) loan from Bắc Ninh Province’s Youth Start-up Fund, Đạo built barns for the animals and bought 70 bamboo rats and 1,000 rabbits.

To feed the animals, Đạo planted sugarcane, vegetables and raised worms.

After three months, his bamboo rats had started reproducing and the rabbits were ready for sale.

Unfortunately, the COVID-19 pandemic meant he was unable to sell the animals.

About a third of his rabbits have reached their maximum weight and need to be sold, but he is unable to find customers.

Đạo had to spend more than VNĐ500,000 (US$27) per day to feed them, and the animals were at risk of contracting diseases.

“When I was trying to make the business survive, I heard about a 'rescue plan provided by the Youth Union organisations,” Đạo said.

Nguyễn Thị Trâm's vegetable farm in Minh Tân Commune of Lương Tài District was also badly impacted by the pandemic.

In 2015, Trâm leased 5ha of land to grow safe vegetables. After applying advanced techniques and technology in planting, last year, her farm earned a turnover of VNĐ13 billion (US$562,000), of which profit was VNĐ1.2 billion (US$52,000).

However, in February, her vegetables came to harvest but she could not sell them.

“This year, I focused on supplying vegetables for schools and factories, because I thought demand would be high when students and workers return after Tết,” said Trâm.

“However, due to the pandemic, many factories remained closed, while schools and restaurants were shut, so tens of tonnes of vegetables could not be sold, causing hundreds of millions of đồng in losses,” said Trâm.

Political and social organisations, especially Bắc Ninh’s Farmers' Association and Youth Union, helped 'rescue' a large amount of vegetables to help her continue production and business.

Nguyễn Đức Sâm, secretary of the provincial Youth Union, said: “In recent years, Bắc Ninh Youth Union had stepped up start-up activities that  became a bright spot in youth movements nationwide.”

“Facing the impact of the COVID-19 pandemic, start-up companies of young people were severely affected, especially the production and consumption of products,” said Sâm.

“As a ‘midwife’ for young people’s start-up businesses, the Youth Union had strengthened coordination of sectors and agencies to review the economic development models by young people so as to provide encouragement and solutions to overcome difficulties,” said Sâm.

Particularly, the provincial Youth Union had co-operated with the Việt Nam Bank for Social Policies to delay and reschedule debt repayments for businesses that were badly impacted by the pandemic, according to Sâm.

Last year, the bank rescheduled debts worth dozens of billions of đồng.

With the policy of on-the-spot support, the Youth Union at all levels of Bắc Ninh Province had 'rescued' and consumed dozens of tonnes of agricultural products.

Bắc Ninh Provincial Youth Union will continue to propose and recommend to the provincial People's Committee to pay attention to supplementing and maintaining the capital from the local budget entrusted to the Việt Nam Bank for Social Policies to provide loans to young people starting businesses.

The union would also propose to the authorities to accelerate the reform of administrative procedures as well as enhance training and improve the quality of corporate governance to help businesses solve difficulties, said Sâm.

Vietnam to offer exciting investment opportunities post COVID-19

Standard Chartered Bank last week hosted an investment webinar entitled “Viet Nam Investment Landscape 2021”, drawing the participation of clients based in Viet Nam and overseas who are looking for investment opportunities in Viet Nam.

The presentations focused on giving clients the latest information about the investment landscapes for real estate, stocks, fixed-income and funds in Viet Nam in the context of a post COVID-19 era and the strategies they can devise to capitalise on the opportunities.

“Standard Chartered Global Research forecasts that Viet Nam’s economic growth will get back to 6-8 per cent in 2021 and onwards. Given its economic prospects, advantages of social stability and success in managing the COVID-19 pandemic along with the profitability of the local stock market and real estate market which is growing at a higher pace than that in the ASEAN region, Viet Nam continues to offer exciting investment opportunities. Leveraging on our unrivalled strengths of an extensive global network and in-depth knowledge of the local market, we provide clients world-class, customised products and services to help them make the most of the investment opportunities and grow their wealth sustainably,” said Harmander Mahal, Consumer, Private and Business Banking Head for Viet Nam and Asia Cluster Markets, Standard Chartered Bank.

Standard Chartered Vietnam offers offshore account opening service that enables its overseas clients to open an account and transfer money for investment without the need to visit Viet Nam. The document processing work will be facilitated by the Bank’s partners based in the client’s home country. Once the fund is remitted to Viet Nam, it will be converted into the local currency at an attractive real-time exchange rate, with the foreign exchange fee being waived. Clients will also receive consultation and support from the bank’s experts and dedicated relationship managers to help them make timely investment decisions.

Building Cai Mep-Thi Vai port on a par with regional port

Prime Minister Nguyen Xuan Phuc visited the Cai Mep-Thi Vai deep-water port system in Ba Ria-Vung Tau province on March 20, asking the locality to build the port and logistics systems on a par with others in the region by 2030.
Cai Mep-Thi Vai international port cluster measures over 20km and accounts for over 30% of the country’s container exports, as well as having been evaluated to currently boast the leading commodity growth rate in the region, expected to become a trade gateway in the South.

The PM inspected Gemalink Deep-water Port - the largest scale port project in the Cai Mep-Thi Vai deep-water port cluster, Cai Mep International Port, and Tan Cang-Cai Mep International Port.

After the visit to the port cluster, PM Nguyen Xuan Phuc and Permanent Deputy Prime Minister Truong Hoa Binh held a working session with leaders of Ba Ria-Vung Tau province in a bid to further boost the efficiency of the port system and stimulate local socio-economic development.

The PM emphasised that the seaport system is a strength of the province which has made a significant contribution to national development, thus, more attention should be paid to developing the port system in the future planning of both the province and the nation.

He noted that the growth rate of 2% of seaport system in the province is good news, especially amid the COVID-19 pandemic.

However, PM Phuc pointed out some shortcomings that need to be handled to foster the development of the port cluster including an incomplete transport infrastructure, the lack of modern logistics centres, incomplete finance and customs services and the slow clearance of goods, and others.

The government leader also approved the implementation of various infrastructural projects to promote the efficiency of the seaport system in the province.

He encouraged the relevant ministries, sectors and Ba Ria-Vung Tau province to take more drastic measures to bring the seaport and logistics system in Ba Ria-Vung Tau, particularly Cai Mep-Thi Vai port on a par with others in the region by 2030 and become a world-class seaport hub by 2045.

House prices rise despite of COVID-19 impact

House and land prices in Viet Nam have continued to rise – despite the effects of COVID-19.

Now the Ministry of Construction has compiled a report to determine exactly why there has been a sharp increase in prices.

It is concerned some real estate agents may have inflated prices for their own gain.

The agency said house and land prices surged sharply in 2020, especially in the first two months this year.

Property prices in some places have increased by more than 10 per cent compared to early 2020.

The agency reported that despite many difficulties and challenges in the past year caused by both the pandemic and natural disasters, the real estate industry alone contributed about 4.42 per cent in revenues to the State coffers.

It said in the past, the Ministry of Construction proposed Government build more social housing for low-income earners in urban areas and industrial zones.

The ministry has conducted routine compliance inspections on investment and business practices at big real estate firms, real estate investment.

The inspections were designed to prevent false house pricing, and inaccurate estimates to stop unscrupulous real estate agent from gaining a financial advantage.

This has helped keep house and land prices stable, compared to 2019.

Thu Hang, a senior official of Savills Hanoi, believes as the economy grows post-pandemic, there will be more opportunities for people to buy or rent a property.

She feels urbanisation has not kept up with population growth, causing a drastic imbalance between supply and demand.

The report also said rising costs in building material and fuel has also played a part in the price hike.

In addition, local authorities nationwide are selling land to private developers at inflated prices.

The knock-on effect has contributed to a rise in property prices.

A solution to stabilise the market

According to the Ministry of Construction, managing and stabilising the local real estate market, the ministry has actively studied and submitted many solutions and policies to the Government with a view to minimise imbalance between supply and demand to meet market demand.

In particular, the Ministry had submitted draft decrees on amending and supplementing the No. 99/2015 detailing and guiding the implementation of a number of articles of the Law on Housing and Decree of Government No. 100/2015/ND-CP dated October 20, 2015, development and management of social houses.

This year, the ministry will submit proposals to amend current policies to both the National Assembly and Government.

The Ministry will ask Government to instruct cities and provinces to strengthen supervision of real estate development and investigate any organisation thought to be cheating the system.

Vietnam Association of Architects launches architectural design contests

The Vietnam Association of Architects has launched two architectural design contests for the commercial centre complex and the riverside landscape of the first phase of Cai Gia - Cat Ba Tourist Urban Area (Cat Ba Amatina).

“The contest to design the commercial centre complex is only for professional and experienced architects while the riverside landscape design contest is for 3rd & 4th year architecture students. Both of the two contests are only for Vietnamese architects to create a professional playing field for architectural innovators in Viet Nam,” said Chairman of Vietnam Association of Architects Phan Dang Son.

Design requirements for the commercial centre complex must be a unique and creative architectural work, creating a highlight for the architectural landscape of Cat Ba Town in Cat Ba Island, Cat Hai District, Hai Phong City.

In addition, the contest category for the pedestrian street along both sides of the river should ensure a green living environment for urban residents and an impressive experience for visitors at the Cat Ba Amatina Tourism and Urban Area.

The two contests will run from March 16 to May 16 and the result is expected to be announced later in May. The project investor, Vinaconex Tourism Development and Investment Joint Stock Company (Vinaconex - ITC), will select the best projects for official implementation.

Forbes spotlights Vietnamese hospitality sector’s creativity amid pandemic

US business magazine Forbes has recently published an article highlighting the Vietnamese hospitality sector’s creativity to survive the COVID-19 pandemic.

According to the article, titled “Viet Nam’s hotels get creative to survive the pandemic” by Brett Davis, COVID-19 forced some in the industry to rethink their approach to how to cater to guests and innovate their offerings.

It said one such innovation was developed at Alma Resort on the shores of Cam Ranh Bay in southern Viet Nam, which built its own in-house app to create a safe, contactless way of delivering key information to guests.

Developed by the resort’s IT team and available for download on Android, Apple, Windows and Amazon devices, the 'Alma Resort' app provides COVID-19 health and safety tips, menus for the property’s restaurants, activity schedules and promotions as well as live stream broadcasts and information about events.

The resort’s general manager, Herbert Laubichler-Pichler, said he believed it would soon be incumbent for five-star resorts across Viet Nam to offer the same technology.

The author went on to note that thanks to the Government’s drastic measures, Viet Nam was one of the world’s leading countries in controlling the spread of the pandemic.

It said domestic tourism, and the steadily growing purchasing power of Vietnamese consumers, came to be viewed as a lifeline for the local tourism industry, provided it could change its strategy in some key areas. One such example was in the food and beverage offerings.

Looking forward, Herbert Laubichler-Pichler predicted there would be a strong rebound in the Vietnamese tourism sector because of the pent-up demand for travel after a year spent in various forms of isolation.

Foxconn in talks with VinFast on batteries and components for electric

Taiwanese electronics manufacturer Foxconn is reportedly in talks with the Vietnamese automaker VinFast to produce batteries and electric vehicle (EV) parts.

Reuters cited sources saying that Foxconn proposed to acquire EV production lines from VinFast. However, a spokesperson for VinFast said they had not discussed any details relating to this matter.

"The partnership, if any, will only focus on developing the batteries and electric vehicle parts. There is no information regarding the cooperation of the two parties in producing EVs,” the spokesman added.

VinFast wants to become Foxconn's partner but not in manufacturing orders.

Foxconn, the world’s largest provider of electronics components, has outlined plans to become a major provider of parts and services in the global EV market, so any agreement with VinFast would follow deals with Fiat Chrysler and other EV start-ups.

VinFast became Viet Nam’s first domestic vehicle manufacturer with its own badge to debut the first gasoline-powered models in 2019. The automaker has a factory in the northern port city of Hai Phong which is also responsible for main production.

The company sold about 30,000 vehicles last year and is expected to deliver the very first EVs to the domestic market at the end of 2021.

VinFast, which is also producing electric motorbikes and buses this year, signed a contract to produce electric vehicle batteries with Taiwan’s ProLogium.  

Huge volume of shares flock to HoSE despite current overload

Despite chronic overloading on the Ho Chi Minh Stock Exchange recently, a series of stocks are still making their way to the main bourse in March, putting more pressure on the exchange.

Southeast Asia Commercial Joint Stock Bank (SeAbank) has been approved to list its 1.2 billion shares on the bourse on March 24, equivalent to charter capital of VND12 trillion (US$520 million).

SeABank shares on the over-the-counter market are being traded at around VND14,400 (62 US cents) apiece.

HoSE last week also gave the green light for 15.18 million shares of Vnsteel - Vicasa Joint Stock Company to list on the bourse.

Nearly 1.1 billion shares of Orient Commercial Joint Stock Bank (OCB) had also got approval in the last days of 2020. They were officially listed on the southern bourse since January 28.

HoSE’s trading system, which has remained mostly unchanged for the last 20 years, has been overwhelmed after a huge number of new investors began trading in recent months. Many complain about the overload trouble while they are placing orders, especially in the afternoon when trading value rises to VND15 trillion ($652 million).

Concerted efforts

Market regulators need to work with HOSE to solve congestion, said General Director Trinh Hoai Giang of HCM City Securities Corporation (HSC).

“It is time for the regulator to re-organise listed stocks according to their capitalisation as the group of large and medium stocks accounted for a trading value of 85-90 per cent,” he said.

“However, the number of transaction orders for small stocks is huge. Therefore, we should send the entire group of small stocks to the Ha Noi Stock Exchange as a temporary solution. We should only consider the plan to increase the minimum trading lot if the congestion problem still does not end.”

“Regarding increasing the minimum trading lot, it is not advisable to do it simultaneously but to divide stocks based on market price. For stocks with a market price below VND20,000 per share, the lot can be increased from 100 to 1,000, while for stocks with higher market prices, the lot should be kept at 100.”

Some companies have volunteered to move their shares from HoSE to HNX following the instruction of the State Securities Comm (SSC) to alleviate system overloads that have troubled traders.

They included VNDirect Securities Corporation, BIDV Securities JSC (BSC) and PAN Group (PAN), while a number of other securities companies agreed to change the floor to reduce the load on HOSE's trading system.

VietinBank Securities Company and Agribank Securities Company said that they supported this exchange switching plan but they must submit the switching process to the shareholders during the General Meeting of Shareholders, expected to be held in April this year.

“Transferring to HNX is a temporary plan to help mitigate congestion on HOSE,” said Ta Thanh Binh, Director of Market Development Department under the State Securities Commission.

“When the new trading system is fixed, these shares will return to HoSE. The transfer from HOSE to HNX will not change the listing standards as well as the quality of the transferred shares,” she said.

Consequences

“Some Singapore funds have sold out recently partly due to concerns about the errors on the trading system of HoSE,” said Quan Trong Thanh, director of market analysis and institutional investors at Maybank Kim Eng Securities (MBKE).

“These funds themselves have a great position on the global market, in the context of global volatility and concerns about inflation, they need to prepare to withdraw capital in time. Due to recent worries over HoSE system problems, they decided to sell first to ensure capital flow.

“If there is no problems of system congestion, it is likely that they will not decide to sell early because of the promising economic outlook of Viet Nam and stable profit growth of the businesses,” he said.

“Trading congestion is different from traffic congestion, as in the former if orders cannot be placed, the opportunity is lost and will not come back again,” said Le Ngoc Nam, Deputy General Director of Tan Viet Securities Company.

“Securities companies can not only not collect fees but also face the risk of being sued by investors. Their revenues are not only sourced from fees for transactions, but also from margin lending fees and other services,” Nam said.

“If securities companies cannot collect fees, the exchange will also lose revenue,” he said.

Liquidity on HoSE could have reached an average of VND20 trillion per session if no congestion happened, higher than the current average of VND15 trillion.

As HOSE collects 0.027 per cent of the transaction value from both buying and selling sides, it is estimated to have lost VND2.84 billion in fees every day due to congestion, assuming an average value transaction of VND20 trillion per day, Nam said. 

VIETNAM BUSINESS NEWS MARCH 22
VIETNAM BUSINESS NEWS MARCH 22

Source: VNA/VNS/VOV/VIR/SGT/Nhan Dan/Hanoitimes

 
 

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