Planning minister proposes solutions to help businesses address difficulties
Minister of Planning and Investment Nguyen Chi Dung has recommended six groups of solutions to help solve difficulties for enterprises during a recent meeting between Prime Minister Pham Minh Chinh and representatives of the business circle and localities.
Firstly, ministries, sectors and localities should raise sense of responsibility, review and amend conditions, processes and procedures to create favourable conditions for businesses to access the Government’s support policies, and promote the implementation of activities to support businesses in digital transformation.
Secondly, the Ministry of Health needs to issue guidance on the roadmap to return to the new normal state and create favourable conditions for enterprises to conduct production and business as soon as possible in accordance with ensuring pandemic prevention and control regulations, Dung said.
Thirdly, it is necessary to improve operations of the Prime Minister's Special Working Groups to remove difficulties for businesses and people affected by the pandemic, and facilitate implementation of investment projects.
Fourthly, the Ministry of Planning and Investment will submit to the Government for consideration and promulgation of a programme on sustainable economic recovery until 2023.
Fifthly, localities should develop and publicise plans for economic recovery and reopening in the new situation, and work with enterprises to study measures to ensure safe production and business and minimise the closure of the whole factory.
Sixthly, the minister stressed the need to study and propose solutions to build the programme on sustainable economic recovery until 2023, strengthen dialogue between businesses and local authorities to promptly remove difficulties and obstacles facing enterprises and evaluate the actual process of handling the recommendations of the business community.
He also suggested enterprises to uphold solidarity and unity to overcome difficulties and challenges, innovate production and business models, implement digital transformation, and improve productivity and competitiveness to join the global value chain./.
Special working groups to be set up to assist businesses, people
Prime Minister Pham Minh Chinh has ordered ministries, agencies, and localities to set up special working groups to tackle difficulties facing businesses and people amid the COVID-19 pandemic.
According to the Government Office, on August 30, the PM issued a decision on the establishment of his special working group for addressing difficulties the COVID-19 outbreak has caused to businesses and people.
To carry out solutions relevant to each ministry, sector, and locality in a timely manner, the PM asked ministries, ministry-level agencies, Government agencies, and provincial-level People’s Committees to quickly set up special working groups headed by their leaders.
These working groups have to direct the effective implementation of tasks and solutions stated in the National Assembly and the Government’s resolutions, as well as the PM’s directions; proactively coordinate with related ministries, sectors, localities, and agencies; actively grasp information and take timely measures to handle difficulties, obstacles, and proposals; and assist enterprises in their production and business activities to safely and flexibly adapt to the COVID-19 pandemic.
They also need to cut unnecessary administrative procedures while not creating “sub-permits” so as to not adversely affect enterprises’ operations and people’s lives, thereby helping to promote socio-economic development and achieve the best possible socio-economic outcomes.
The PM also demanded they make reports on the settlement of difficulties on a monthly basis or when necessary, and propose solutions to the issues beyond their jurisdiction to the Cabinet leader, according to the Government Office.
Wood craft villages face strong reduction in output, income due to COVID-19
Production and income of business households in the Red River Delta-based traditional wood craft villages have reduced due to social distancing measures amid the COVID-19 pandemic, according to the Viet Nam Timber and Forest Products Association (VIFOREST).
The business households have had to reduce production capacity by 62 per cent, according to a survey by VIFORESTunveiled at the webinar "COVID-19 pandemic and wood craft villages: Impact and necessary policies" held on September 22.
These villages include Dong Ky (Bac Ninh Province), Huu Bang, Lien Ha and Van Diem (Ha Noi), Thuy Lan (Hung Yen Province) and La Xuyen (Nam Dinh Province).
The survey also reported that they have seen reductions of 76 per cent in output and 80-90 per cent in income.
About 70 per cent have had to borrow capital for production and business. Under pressure to pay interest rates for bank loans, some households have resorted to black credit with much higher interest rates than at banks to pay. This is a huge risk, according to the survey.
According to To Xuan Phuc, an expert of Forest Trends, another challenge for them is the increase in input material costs for production. The application of social distancing measures has caused freight and the price of sub-material to rise by an average of 20-25 per cent, while the cost of input wood has surged by 5-10 per cent.
Nguyen Thi Bay, the representative of the Huu Bang Wood Craft Village in Ha Noi, said her village mainly produces household wood products. Since the pandemic, this village has mostly suspended production and the village’s business households have been facing many difficulties.
Therefore, Bay has proposed the State to provide capital support and tax reduction for those households.
She also hopes that the association can act as a bridge connecting the craft villages to export companies so the households can participate in the export production chain. This will help the craft villages create more jobs and raise incomes.
Vu Quoc Vuong, chairman of the Dong Ky Wood and Fine Arts Association, said that Dong Ky mainly produces high-quality goods for export to China. However, in the past two years, this market has almost closed, so the village has faced many difficulties in production and business activities.
Those villages expect the State to provide solutions in terms of loans, land lease, consumption and business renovation. Of which, the most important recommendations are to reduce interest rates of loans and delay payment terms.
Phuc said that from the beginning of July 2021, the Government has issued two resolutions to support people and businesses who are negatively affected by the pandemic. However, the households surveyed confirmed that they could not access the financial support.
The households do not have business or tax payment registrations, so their production and business activities are not recognised by management agencies, he said.
Do Xuan Lap, VIFOREST chairman, said that it is necessary to develop policies to support household businesses in craft villages.
In addition, closer connections should be built between the craft villages and enterprises, association members, and management agencies, he said.
Phuc said the Government should adjust supportive criteria to ensure that the households in craft villages can get the support.
Besides that, the Government should enhance support for the households in converting from business households to enterprises. This change will help households to access State and social support for their development and also helps the State to manage the activities of the craft village in the future, he said.
Viet Nam’s seaports handle over 537.7 million tonnes of goods in 9 months
Viet Nam’s seaports handled in excess of 537.7 million tonnes of goods in the first nine months of the year, a year-on-year rise of 3 per cent, reported the Viet Nam Maritime Administration.
Despite the negative impacts of COVID-19 on some major ports in the southern region, the total volume of container cargo going through seaports maintained a double-digit growth rate of 15 per cent compared to the same period last year to near 18.6 million TEUs.
Of the figure, the volume of exports was estimated to hit over 6 million TEUs, surging 13 per cent, that of imports over 6.1 million TEUs, up 18 per cent, and that of domestic goods 6.3 million TEUs, up 13 per cent.
Although some seaport areas were put under strict social distancing measures in an effort to curb the spread of COVID-19, the volume of goods that went through those in HCM City expanded more than 7 per cent, in Ba Ria-Vung Tau 5 per cent, and in Hai Phong nearly 11.7 per cent year on year.
Under a freshly approved master plan on developing the domestic seaport network over the next 10 years, with a vision towards 2050, Viet Nam aims to develop a uniform system of modern seaports that provide high-quality services, meet needs for socio-economic development, and ensure national security and defence, maritime safety and environmental protection, and improving the economy’s competitiveness.
It is expected to help the country fulfill its goal of becoming an upper-middle-income developing country with modern industry by 2030.
The plan classifies Vietnamese seaports into five groups based on their geographical locations. About VND313 trillion (US$13.74 billion) mobilised outside the State budget will be needed for its implementation.
Foreign investors keep trust in Vietnam’s recovery
At a factory of Nestle in Hung Yen province (Photo: baodautu.vn)
Recent announcements made by foreign investors on additional investment to expand production in Vietnam reflect their trust in Vietnam’s prospects for economic recovery, reported the Dau tu (Investment Review) newspaper.
The Swiss company Nestle said it is pouring an additional over 130 million USD, raising its total investment in Vietnam to 730 million USD to carry out a number of its projects in the next two years.
Urs Kloeti, Factory Manager of Nestle Bong Sen, was quoted by the newspaper as saying that his company believes in Vietnam’s role as an international and regional manufacturing hub in the future.
Alongside Nestle, other foreign firms have committed to maintaining operations in Vietnam despite the fourth wave of COVID-19 outbreaks that have forced various localities to apply stringent preventive measures.
Tetra Pak of Sweden has confirmed that it will pump 5 million EUR (5.86 million USD) to expand its existing 120-million-EUR plant in Binh Duong southern province.
The investment demonstrates the company’s trust in Vietnam’s strong economic recovery after the pandemic, according to Managing Director and President at Tetra Pak Vietnam Eliseo Barcas.
In particular, the LG Display project in Hai Phong northern port city has received additional investment twice this year, with 750 million USD in February and 1.4 billion USD in August.
Earlier this month, authorities in the northern province of Quang Ninh presented an investment registration certificate to a 365.6 million USD project of Jinko Solar Vietnam Co. Ltd., an affiliate of the Jinko Solar Holding Co. Ltd. The firm channeled nearly 500 million USD into a project in the province in March.
Despite current challenges triggered by the pandemic, Japanese firms in Vietnam are working to adapt and improve their production system in the new situation, said Chief Representative of the Japan External Trade Organisation (JETRO) in Hanoi Nakajima Takeo.
For his part, Alain Cany, Chairman of the European Chamber of Commerce (EuroCham) in Vietnam, said the European business community is determined to stand side by side with the Vietnamese Government in this tough time and believes that the Government will successfully bring COVID-19 under control like it did before.
As they have showed their determination to maintain operations in Vietnam, most foreign investors hope that the Government will promptly devise a clear plan for reopening and economic recovery, or else current investment plans will be delayed and newcomers cannot enter the country to study investment possibilities.
Despite COVID-19 impacts, foreign direct investment (FDI) inflows into Vietnam during the first nine months of this year rose 4.4 percent year on year to 22.15 billion USD, reported the Foreign Investment Agency under the Ministry of Planning and Investment.
The total imports-exports value of the FDI sector in the first eight months of the year also surged 31.2 percent to 297.43 billion USD, with exports accounting for 156.64 billion USD./.
Vietnam not let COVID-19 hold back its pace: former VCCI leader
Vietnam is spreading a message among domestic and foreign business community that the country will not let COVID-19 to hold back its pace of development and Vietnam has been and will continue to be the top destination for investors, said Vu Tien Loc, President of the Vietnam International Arbitration Centre (VIAC).
Speaking at an online meeting between Prime Minister Pham Minh Chinh with businesses and localities on September 26 on measures to support them amid COVID-19, Loc, who was President of the Vietnam Chamber of Commerce and Industry (VCCI) in the previous tenure, held that the adjustment of COVID-19 response strategy from no COVID-19 to safely and flexibly adapting to and effectively controlling the pandemic is a sound and timely decision.
The amendments in vaccine strategy as well as efforts to increase supply and speed up injection speed as well as the definition of prioritised groups have brought about encouraging results, he said.
The business leader held that this is a firm foundation for the Government to launch a process of loosening social distancing, recovering the stagnant production and business activities, and creating a “golden time” for the rescue of enterprises. “If we re-open any slower, we will have to pay a more expensive price,” stated Loc.
However, Loc said that opening the door does not mean neglecting safety. The Prime Minister has directed the Ministry of Health to coordinate with ministries, sectors and the business community as well as experts to draft a guidance on safely and flexibly adapting to and effectively controlling the pandemic.
Loc suggested that no additional licences or new business conditions should be created during this process.
In order to assist enterprises in quickly switching to the safe operation amid COVID-19, thus completing the dual targets, Loc proposed that economic forces be given greater presence in the National Steering Committee on COVID-19 Prevention and Control, and the committee be renamed National Steering Committee on COVID-19 Prevention and Control and Economic Recover to reflect the dual targets.
He added that the same change be made to the steering committees in all localities./.
Vietnam’s exports to Cambodia up 16.7 percent in eight months
Vietnam earned 3.15 billion USD from exporting goods to Cambodia in the first eight months of 2021, up 16.7 percent year-on-year.
However, Vietnam reported a trade deficit of 354.4 million USD with Cambodia in the reviewed period.
One of the reasons behind the trade deficit was increases in import turnover of six main products from Cambodia compared to the same period last year, with the imports of cashew nut and rubber witnessing the highest rises.
Vietnam spent almost 1.83 billion USD on importing cashew nuts from Cambodia in the first eight months, a 7.1-fold hike year-on-year. Meanwhile, Vietnam’s rubber imports from the neighbouring country were 5.3 times higher than the figure of the same period last year, reaching 821.8 million USD.
Vietnam’s registered investment in Cambodia hit over 2.85 billion USD, mainly in agriculture, including cashew and rubber planting.
Vietnamese businesses have invested in Cambodia to take advantage of cheap labour costs and favourable conditions in terms of land, climate and incentives, and then exported their products back to Vietnam.
To balance the trade value with Cambodia, Vietnam needs to promote processing to improve the added value of export goods, increase yields and quality of cashew and rubber, and seek to expand export markets for cashew nuts and rubber products.
Attention should also be paid to strictly controlling the import of these goods to ensure origin rules, and enhancing inspection of commodities exported to Vietnam through Cambodia./.
Driving the national economy through storms
After more than 35 years of renewal, especially in the past 5 years, Vietnam has made many important and comprehensive achievements, contributing to enhancing the position and power of the country. However, the national economy is facing many difficulties and challenges, particularly in Ho Chi Minh City and neighbouring provinces due to the serious impacts of the ongoing COVID-19 pandemic.
Under the leadership of Party and State leaders together with the involvement of the whole political system and the consensus and support of the people and business community, the Government has always strived to surmount all hardships and challenges to continue to steer the economy to overcome storms.
From the beginning of the year, especially since the Government was consolidated in April, Prime Minister Pham Minh Chinh has always been persistent in realising the dual goal of both effectively preventing the pandemic and promoting socio-economic development. Vietnam’s GDP growth was reported at 5.64% in the first half of 2021, a high rate compared to other countries around the world.
The PM and the Government have also organised many working sessions with ministries, sectors, agencies, enterprises and localities to devise solutions for each sector, particularly removing obstacles for production and business activities amidst the pandemic.
The Government has issued many important policies to support the business community to overcome difficulties, particularly Resolutions 68 and 86/NQ-CP which are timely support policies and “vaccines” for people and enterprises.
In addition, the Government has continuously asked for reductions in the prices of electricity, water, and telecommunications by tens of thousands of billions of Vietnamese dong in order to share in the difficulties of people and enterprises.
One of the policies highly appreciated by the public has been the implementation of the vaccine strategy through buying vaccines as quickly as possible, promoting the domestic production of vaccines and providing free vaccination for the entire population.
Public opinion also values the Government's establishment of the COVID-19 Vaccine Fund and the effective and active implementation of “vaccine diplomacy”.
During the fourth COVID-19 outbreak, PM Pham Minh Chinh has repeatedly inspected epidemic hotspots in Bac Giang, Bac Ninh, Ho Chi Minh City and southern provinces. Through the recent visits to Ho Chi Minh City, Binh Duong, and Dong Nai on August 26 and 27, local people and medical workers all affirmed the value of the establishment of medical care facilities and stations at commune and ward level, contributing to increasing people's access to health care at grassroots level while reducing overload on upper treatment levels.
Although the pandemic is still progressing, positive signals show that the fight against the pandemic is on the right track, particularly the policy of taking communes and wards as “fortresses” against the pandemic and each citizen as a “soldier”.
The Government attaches special importance to ensuring production and avoiding disruptions to the supply chain in order to have the necessary resources to fight the pandemic. The top priority at this time is to fight the pandemic, but production needs to be promoted in any locality or establishment that can ensure safety.
The government has also promptly adjusted any excessive control of transportation to ensure the smooth circulation of goods.
The direction of Government leaders in the pandemic fight has been decisive and strong, thus, many officials at all levels have been disciplined and dismissed for being negligent in pandemic prevention and control.
Government leaders emphasise that amid the difficulties, decentralisation must be boosted to promote the initiative and creativity of all levels and strengthen the solidarity and unity within the Party, the people and localities.
Difficulties and challenges will be much larger than advantages and opportunities in the near future but we must act decisively, overcome difficulties, and consider these as motivation to grow and develop, the Government leader said.
The Government has identified the main tasks and key solutions for the 2021 – 2025 period including combating the epidemic, in combination with restoring and fostering socio-economic development, restructuring the economy in association with renovating the growth mode, boosting the digital economy and ensuring social security.
In particular, the Government has thoroughly grasped the direction of Party General Secretary Nguyen Phu Trong that “Do not sacrifice progress and social justice to chase economic growth”.
The “COVID-19 cloud” has cast a shadow over people's lives. This is the time when “fire is testing gold and adversity is testing the brave” but we have the right to hope and believe that a new dawn of normal life will soon return.
The government has mobilised the strength and great unity of the whole people, inspiring them to join hands with Party committees and authorities to realise all goals and tasks.
During the pandemic, difficulties and tribulations, the spirit of overcoming difficulties, the tradition of solidarity, mutual compassion, and “good leaves cover torn leaves” as well as the people's trust in the Party and State are being strengthened and demonstrated more clearly than ever.
Rubber exports enjoy growth during January-July
Vietnam exported nearly 919,000 tonnes of rubber, earning 1.54 billion USD in the first seven months of 2021 with the price of 1,677 USD per tonne, up 34.2 percent, 74.5 percent and 30 percent respectively, according to the General Department of Vietnam Customs.
In July alone, rubber exports enjoyed increases of 25.3 percent in volume and 22.8 percent in turnover, but experienced a decrease of 2 percent in price compared to the previous month. Compared to those in July 2020, the export of Vietnamese rubber saw growth in all three aspects, with 1 percent, 38 percent ad 35.7 percent, respectively.
China is Vietnam’s biggest rubber importer, with over 643,000 tonnes worth 1.04 billion USD, equivalent to 70 percent of the total volume and 67.4 percent of the total turnover. The figures represented year-on-year rises of 26.4 percent in volume and 62.7 percent in value.
It is followed by the EU with nearly 50,000 tonnes and 89.8 million USD, and India with over 47,000 tonnes and 85.5 million USD./.
Consumer price increase drops to record low since 2016
Vietnam’s consumer price index (CPI) for the first eight months of 2021 dropped to a record low since 2016.
According to the General Statistics Office (GSO), the CPI climbed 0.25 per cent in August, up 2.51 per cent against December 2020 and 2.82 per cent against August 2020. However, the overall eight-month figure increased 1.79 per cent from a year earlier, the lowest jump since 2016.
The rising price of food and food services at localities under in social distancing under Directive No.16/CT-TTg has increased consumer prices in August. The group of food commodities and services obtained the highest price rise of 0.74 per cent due to disruptions to transportation and distribution of goods and panic buying.
Meanwhile, the beverage-tobacco group climbed 0.22 per cent on the back of a seasonal growth in demand for beverages. Meanwhile, tobacco prices grew due to high transportation costs and reduced supply. Likewise, the prce education services and goods increased by 0.04 per cent while drugs and medical services increased by 0.02 per cent.
Three groups of goods and services maintained stable prices, including housing and construction materials, equipment and household appliances, and other goods and services.
The GSO also said that core inflation for August increased by 0.02 per cent on-month but was up 0.98 per cent on-year. The eight-month core inflation this year rose 0.9 per cent over the same period in 2020.
Switzerland increases import of Vietnamese cashew nuts
Switzerland increased its imports of cashew nuts during the 2016 to 2020 period, with imports from the Vietnamese market enjoying a significant growth rate.
According to data released by the International Trade Center (ITC), Switzerland's cashew imports throughout the reviewed period saw annual growth of 13.6% in volume and 12.9% in value, climbing from 1,900 tonnes worth US$18.98 million in 2016 to 3,120 tonnes worth US$28.24 million in 2021.
In terms of the figure, Switzerland's cashew nut import rate from the Vietnamese market witnessed an increase of 20.4% per year in volume and 19.8% per year in value, rising from 742 tonnes worth US$7 million in 2016 to approximately 1,500 tonnes worth US$12.33 million last year.
During the first half of this year, the Central European country moved to increase its cashew nut imports from Vietnam, the Ivory Coast, and Benin, although they reduced their imports from both India and the Netherlands.
Statistics indicate that Swiss cashew nut imports from the Vietnamese market during the reviewed period reached 777 tonnes valued at US$6.52 million, representing an increase of 40.4% in volume and 35.6% in value compared to the same period from last year.
At present, Vietnamese cashew nuts have a competitive advantage in the Swiss market due to the country’s growing cashew nut market share, with Switzerland’s total imports soaring from 38.58% in the first half of last year to 53.16% this year.
Vietnam aims for a global seafood processing hub by 2030
Prime Minister Pham Minh Chinh has approved a scheme which aims to develop the Vietnamese seafood processing industry and turn Vietnam into a global seafood processing hub by the year 2030.
Under the scheme, Vietnam will develop the seafood processing industry in a modern, effective and sustainable manner to meet market demands. It will strive to sharpen the competitive edge of the industry, making it integrate deeper into the global value chain, and rank fifth among the world’s seafood processors by 2030.
Specifically, the growth rate of processed seafood output by 2030 will reach over 6% annually, while the proportion of export value of processed seafood products will hit an average of over 40%.
The seafood processing industry aims to rake in between US$14 - 16 billion from exports by 2030.
In addition, Vietnam will establish several seafood processing groups that have global-level economic potential and management level.
The scheme will consist of six major projects, with total costs anticipated to reach up to VND420 billion.
Businesses, workers eager to return to production
As a labour-intensive industry, textile enterprises in Ho Chi Minh City have many concerns to address, especially a shortage of workers. According to calculations, businesses are currently short of about 85,000 workers, or 30 percent of needs. Though eager to reopen, businesses must rush to find workers.
Pham Van Viet, Vice Chairman of the Ho Chi Minh City Association of Garment, Textile, Embroidery, Knitting, said: "Without an adequate number of workers, the textile industry will struggle to fully recover. We expect the industry to recover about 70 percent of production by the end of the year."
The recovery of production post-pandemic will depend entirely on the return of workers. Leather and footwear businesses are also concerned about losing orders and markets because of a lack of staff.
The biggest difficulty for workers hoping to return to Ho Chi Minh City or Binh Duong and Dong Nai provinces to the ongoing travel restrictions.
According to the Ho Chi Minh City Department of Statistics, the city has about 3.2 million salaried workers. 50-70 percent of the workforce had to temporarily cease working to prevent the spread of the pandemic. The difficulties in the hotspot forced a large number of workers to head back to their homelands in the provinces. Now both businesses and workers hope to return to production as soon as possible.
In addition to preferential policies in terms of credit and vaccinations, transport support is a fundamental solution to encouraging workers to return to Ho Chi Minh City, contributing to the recovery of production post-pandemic./.
Construction works of Metro Line No.1 comply with “three on the spot” regulation
The Ho Chi Minh City Management Authority for Urban Railways (MAUR) yesterday said that the consultants and contractors of Ben Thanh- Suoi Tien metro line (Metro Line No.1) have met the requirements of both construction safety and “three on the spot” regulations of Covid-19 pandemic prevention and control.
According to MAUR, all experts, engineers, staff and workers of NJPT Consultancy Joint Venture and project general contractors have been gotten Covid-19 vaccines and followed the 5K message during the construction and working process.
However, the general contractors are facing difficulties in planning the transport in accordance with the “one route, two destinations” model because of human resources shortage, incurred costs and difficulties in promptly preparedness of material facilities for the works.
IPO frenzy intensifies
Some major tech-affine Vietnamese corporations are jumping on the bandwagon for overseas initial public offerings, particularly in the United States.
Vietnam’s very first unicorn and tech behemoth VNG Corporation last week was allegedly mulling over an overseas listing in the US via special purpose acquisition company route, or SPAC, to tap into the huge chunks of foreign cash.
The online gaming, tech, and e-commerce firm is working with financial advisers to hold discussions with SPACs for a potential deal and a transaction could value VNG at $2-3 billion, according to Bloomberg.
If successful, VNG will be the first Vietnamese corporation to land a listing opportunity overseas on the US’ major exchange after several aborted deals. A VNG representative, however, declined to comment on whether an agreement on SPAC or a conventional IPO route had been finalised.
VNG is among several Southeast Asian unicorns joining the parade of regional peers looking for US listings through SPACs, following in the footsteps of Singapore’s PropertyGuru and Indonesia’s Traveloka.
VNG’s tech-driven portfolio ranges from gaming services and message app Zalo to e-wallet ZaloPay and cloud computing. In addition, it also invests in other startups such as Tiki, Ecotruck, Got It, and FPT Online. The group boasts around 80 million users.
Foreign shareholders like Tencent still own the right to buy over one billion ordinary shares of VNG (equivalent to 2.88 per cent of the group’s stake) until the end of 2021.
VNG’s major foreign shareholders currently include Tenacious Bulldog Holdings Ltd., Prosperous Prince Enterprises Ltd., and two Singapore sovereign funds, GIC and Temasek.
PropertyGuru, meanwhile, is set to trade soon on the New York Stock Exchange. The transaction is expected to close in the fourth quarter of 2021 or the beginning of 2022, subject to regulatory and stockholder approvals as well as other customary closing conditions.
PropertyGuru Pte., Ltd., one of Southeast Asia’s leading property technology companies, and Bridgetown 2 Holdings Ltd., a SPAC formed by Pacific Century Group and Thiel Capital LLC, announced last month that they have entered into a business combination agreement.
In the same boat, Ho Chi Minh City-based delivery startup Loship last week announced its target to make a debut on the New York Stock Exchange by 2024 after reaching profitability in 18-24 months. Earlier this month, Loship bagged a $12 million pre-series C funding round co-led by BAce Capital, Ant Group-backed venture capital firm, and Sun Hung Kai & Co., Ltd., a leading investment company from Hong Kong.
Elsewhere, the Vietnam Competition and Consumer Authority under the Ministry of Industry and Trade received valid documents about the economic concentration of Tiki JSC and Singapore-based Tiki Global. Accordingly, Tiki will transfer 90.5 per cent of its shares to Tiki Global after issuing more shares under a private placement. Ngo Hoang Gia Khanh, deputy general director for Business Development at Tiki, said that the company aims to develop another business entity in Singapore to facilitate future development. “Tiki has plans to develop a tech hub to attract and develop its own pool of engineers,” Khanh stated.
In July, Tiki Global became the parent company of Tiki in Vietnam with a market valuation of $741 million. Tiki Global currently owns 90.54 per cent of Tiki following the latter’s private placement to increase capital from $10.1 million to $106.7 million.
According to experts, e-commerce platforms are incurring losses to acquire market share. With the new entity in Singapore, Tiki aims to raise more offshore capital via SPACs targeting Southeast Asia.
However, the SPAC route for Vietnamese companies going abroad will encounter certain bumps in the road. In May, VinFast – the vehicle arm of Vietnam’s biggest conglomerate Vingroup – delayed its IPO on the New York Stock Exchange due to heightening scrutiny over US regulations on SPACs. VinFast had been working with Credit Suisse, JPMorgan, and Deutsche Bank in preparation for the US listing.
Bamboo Airways, a subsidiary of FLC Group, also revealed its ambition to cash in on an overseas IPO in the US in this quarter.
But representatives of VNLife, the parent company of VNPAY and also Vietnam’s second unicorn, have said it is still “years away” from a potential IPO.
According to Kent Wong, partner, head of Banking and Capital Markets at VCI Legal, the SPAC bubble has burst due to growing concerns over explosion of blank check companies and the impact on retail investors.
“The drawback is that Loship, VNG, and Tiki will have to create a lot of hype to draw retail participation in the US in the short term, and not having a recognisable brand in that market will be a disadvantage,” Wong told VIR. “On top of that, they will need a bona fide business plan and solid target companies to merge or acquire with the raised capital.”
Golden Gate Ventures also believes that other prominent tech names from Southeast Asia are set to go public through SPACs, and “there are still plenty of untapped opportunities in the region compared with China or India”, according to Vinnie Lauria, managing partner of the fund.
Opportunities for Vietnamese agricultural products to enter new markets
In addition to traditional markets such as China, EU, the US and Australia, many agricultural products of Vietnam have witnessed increasing favour in potential markets including Algeria and Turkey, becoming an opportunity for enterprises to expand export markets, especially amid the development of the COVID-19 epidemic.
According to Hoang Duc Nhuan, Vietnamese Trade Counsellor in Algeria and concurrently in Gambia, Mali, Niger, Senegal and Tunisia, coffee is the favourite drink of Algeirans. On average, a person consumes more than 3kg per year. Every year, Algeria imports about 130,000 tonnes of coffee beans of all kinds, worth US$300 million. Robusta coffee accounts for the majority of Algeria’s total coffee import turnover (more than 85%). The main coffee exporting partners of Algeria are Vietnam, Ivory Coast, Indonesia, Brazil and Italy.
Over the years, coffee has always been Vietnam's top export item to Algeria. Vietnam's coffee market share usually remains at the highest level, accounting for more than 50%. However, Algeria is still a potential market for Vietnamese coffee. In addition to green coffee, Vietnamese enterprises can boost exports of processed and instant coffee with higher added value.
Regarding rice, Algeria does not produce this crop, so this commodity has been entirely imported. The country imports around 100,000 tonnes of rice per year, mainly white, long grain, 5% broken and parboiled rice. This market is considered to still be promising for Vietnamese rice because people are used to using Vietnamese rice.
On the other hand, the number of Asian workers in Algeria has been increasing, especially Chinese people. The number of Vietnamese workers for Chinese, Japanese, French and Algerian contractors in particular has reached 4,000. This will contribute to an increasing demand for rice in the Algerian market.
In addition, Algeria’s demand for importing spices, especially pepper, is quite high because they are not produced in the country. Cinnamon is also a potential commodity for export to Algeria. Vietnam’s cinnamon export turnover to the country was US$2.1 million in 2020.
According to data released by the Turkish Statistical Institute (TUIK), the country imported over 3,764 tonnes of black pepper worth over US$7.21 million in the first six months of 2021, a year-on-year increase of 9.4% in volume and 13.6% in value. Notably, Vietnam continued to be the largest exporter to this market with over 2,236 tonnes and turnover of over US$4.32 million in the first half of this year, a sharp increase both in volume and value, accounting for nearly 60% of the market share of export value to Turkey.
Regarding coffee, Vietnam ranked ninth among exporters to Turkey in the first six months. However, in fact, the quantity is extremely limited with around 103 tonnes worth US$192,460, a sharp decrease of 55.2% in value compared to the same period last year and accounting for only 0.2% of export turnover of green coffee to Turkey. Opportunities will be expanded in the near future for Vietnamese businesses capable of producing Arabica and Robusta green coffee.
A representative from Vietnam Trade Office in Turkey said the country is also a large tea consumption market, but mainly black tea. Meanwhile, Vietnam developed more kinds of green tea than black tea. Therefore, Vietnam’s tea export turnover to Turkey is not high. On the other hand, Vietnamese tea enterprises have not focused on their exports to this market. If the businesses want to increase their turnover, they need to define black tea as a key commodity in the near future.
Turkey also increased rice imports from Vietnam with 1,798 tonnes worth over US$1.29 million in the first six months of 2021. This is a relatively low number and the Turkish market has mainly distributed two types of rice from Thailand and India, namely Jasmine and Basmati. A reason for this low rate was that Vietnamese rice export businesses have not paid much attention to trade promotion; meanwhile, Thailand has invited all rice production and trading enterprises from Turkey to visit manufacturers in the country.
For the Algerian market in particular and Africa in general, Vietnam Trade Counsellor Hoang Duc Nhuan noted that with a total population of about 1.3 billion people and diverse demand, the African market has a lot of potential for Vietnamese agricultural exporters to exploit and conquer.
Enterprises should seek partners through channels such as trade promotion programmes, international fairs and exhibitions, business forums, direct trades and referrals from contact agencies Vietnam Trade Office in Africa and familiar customers.
In the last months of 2021, the Vietnam Trade Office in Algeria will display and introduce Vietnamese agricultural and aquatic products as well as their catalogues, samples, and publications. In addition, several webinars will be held to introduce the markets of Algeria, Senegal, Tunisia, Mali, Gambia and Niger for Vietnamese businesses. Meanwhile, a business manual for the Algerian market will be published. The relevant agencies will continue to provide Vietnamese enterprises with market information and business opportunities in the field of agricultural and aquatic products.
Solutions needed to restore labour market
The Covid-19 epidemic broke out in a number of provinces and cities from the end of April, with complicated and unpredictable developments creating many challenges and risks for Vietnam in the implementation of the dual goal on both preventing and combating COVID-19 while boosting economic development.
The report of the Department of Employment under the Ministry of Labour, Invalids and Social Affairs shows that the labour market in Vietnam was negatively impacted in the first seven months of the year along with the increase in the number of Covid-19 infections.
By July 2021, with the implementation of social distancing under Directive 16 in 19 southern provinces and cities as well as Hanoi and some locations in other provinces and cities, the labour force was reduced compared to previous month and the same period last year, with estimates at more than one million employees. The number of unemployed workers increased because many enterprises, production and business establishments were no longer able to fight the epidemic, so they were forced to cut labour.
The Covid-19 epidemic has negatively impacted workers in three economic groups. In which, workers in the agriculture, forestry and fishery sectors have been least affected (with 8.9% of workers in this sector affected), followed by industry and construction (24.6%), while service sector's workers are hardest hit (30.6%).
In July 2021, when the epidemic spread to key areas of the economy such as industrial parks, export processing zones and big cities, the epidemic had a strong impact on industries. Accordingly, up to 70% of seafood processing enterprises were closed because they could not apply the "three on the spot" method, 35% of textile and garment enterprises had to close, and more than 40,000 employees in the southern region of the Vietnam Textile and Garment Group are working under the conditions of social distancing.
In particular, the rate of self-employed workers was recorded as the highest in the past three years. The number of self-employed workers in the second quarter of 2021 was 20.9 million people, accounting for 57.4% of the labour force, an increase of 1.4 million people compared to the same period in 2020, showing that the Covid-19 epidemic has pushed many workers to lose their jobs and fall into a state of vulnerability due to lack of formal employment. At the same time, the outbreak of disease in the southern provinces and cities also led to the situation of large numbers of migrant workers returning to their hometowns.
According to quick statistics of the Departments of Labour, Invalids and Social Affairs, the demand for labourers' returning to their hometown is increasing. Currently, more than 50,000 people have registered with the local government. The movement of labour is a signal that shows the risk of labour shortage in large numbers during and after the epidemic, especially the shortage of unskilled labour working in processing enterprises in the leather, footwear, textile and garment industries, and the electronic components assembly sector in the near future.
In the face of potential long-term risks on both the supply and demand of labour market, the Department of Employment has proposed the upcoming scenarios for the Vietnamese labour market. In which, the worst scenario is that nearly 40 million workers will be negatively affected; and workers in all industries and occupations will be severely affected.
According to the Department of Employment, in order to restore the labour market to serve production activities, it is necessary to focus on implementing a number of important solutions to support difficulties for businesses and workers during the period of epidemic prevention and control. In particular, it is necessary to accelerate the vaccination schedule to soon achieve herd immunity, especially for frontline workers, workers in industrial parks and export processing zones, and workers in the tourism sector, as well as the import and export sector, to maintain production and prevent disruption of the global production chain.
It is necessary to have more policies to directly support businesses and employees, such as reducing loan interest rates, rescheduling debt repayment periods, reducing fees and charges; supporting workers directly by reducing interest rates on bank loans, reducing electricity, water, and gasoline prices; and supplementing support policies to ensure the safe life of migrant workers and self-employed workers so that workers can overcome difficulties during the pandemic as well as prepare human resources to resume production and business.
It is necessary to continue to supplement capital sources for lending to restore production, business, and create jobs; freeze new loans for enterprises to supplement working capital for production; and establish a labour market information system with timely forecasts, providing complete and accurate labour market information to connect labour supply and demand, thus limiting the imbalance between local labour supply and demand.
Vietnam’s tea exports to Australia surge
Vietnam shipped six tonnes of tea worth 74,000 USD to Australia in the first half of 2021, showing year-on-year surges of 62.1 percent in volume and 85 percent in value, according to the Agency of Foreign Trade at the Ministry of Industry and Trade.
Both black tea and green tea grown in Vietnam are becoming more popular in the market.
Average prices of Vietnamese tea stand at 12,308 USD per tonne, up 14.1 percent compared to the same period last year.
Data from the International Trade Centre showed that Australia imported a total of 7,400 tonnes of tea valued at 60.3 million USD in H1, up 27.2 percent in volume and 39 percent in value against the same period of 2020.
Vietnam accounted for just 0.08 percent of Australia's tea imports, up 0.02 percentage point year on year.
The Vietnamese tea sector saw positive signs in exports in the first two months of 2021 when shipping 17,000 tonnes abroad and earning 29 million USD, down 1.6 percent in volume but up 11 percent in value year-on-year.
In January, Vietnam’s tea exports to Pakistan – its biggest importer – rose by 0.9 percent in volume and 8.9 percent in value.
Last year, Vietnam exported nearly 135,000 tonnes of tea and pocketed 217 million USD, down 1.8 percent in volume and 7.8 percent in value compared to those in 2019.
E-commerce gives MSMEs equal opportunities to access global market
Cross-border e-commerce has changed the way firms are doing business, with micro, small and medium sized enterprises (MSMEs) given more equal opportunities to access global market, said Vu Tien Loc, Chairman of the Vietnam Chamber of Commerce and Industry (VCCI).
As the unprecedented COVID-19 crisis has forced many countries around the world to close borders and restrict travels, thousands of in-person business meetings, conferences and trade exhibitions between Vietnam and its major trade partners, such as China, the Republic of Korea, the EU and US, have been cancelled and delayed.
To tackle such challenges, the Ministry of Industry and Trade (MoIT) has cooperated with other ministries, local administrations and overseas trade offices to make use of digital platforms to promote trade and boost exports, according to Deputy Minister Do Thang Hai.
More than 1 million online trading sessions have been organized and hundreds of thousands of Vietnamese companies have engaged in virtual trade promotion events with potential partners from 55 countries and territories, including many new markets in Africa, Hai said.
Through these events, growers of seasonal farm produce in Bac Giang, Hung Yen, Son La, Ca Mau, Dak Lak, Soc Trang and others have also received support to trade their products on multiple popular online marketplaces like Sendo, Shopee, and Voso.vn. It has not only helped farmers seek buyers but also attracted more investment into agricultural production and processing.
Thanks to such efforts, Vietnamese agricultural products have gained access to more major markets, said To Hoai Nam, Standing Vice Chairman and General-Secretary of the Vietnam Association of Small and Medium Enterprises (VINASME).
“Thieu” lychee had cracked open the door to France, Japan and the Netherlands while Hung Yen’s longan had found its way to the EU, he cited, adding that plum and dragon fruits are getting similar support to go global.
Since early 2021, a number of both in-person and virtual conferences to boost sales of “thieu” lychee have been held, connecting growers with domestic and foreign traders, said Minister of Industry and Trade Nguyen Hong Dien. These have proved effective as the lychee has expanded its foothold in demanding markets such as Japan and the EU. Exports of the fruit reached over 89,000 tonnes this year, accounting for 41.4 percent of total sales.
The MoIT is making all necessary legal steps to export more Vietnamese agricultural specialties via cross-border e-commerce, with a hope that farmers can directly supply their products to foreign end-users, Dien revealed.
Vu Ba Phu, Director of the MoIT’s Vietnam Trade Promotion Agency (Vietrade), said his agency is developing a trade promotion ecosystem mobile app to help Vietnamese firms improve the effectiveness of their promotion activities.
It will also pilot a project providing support for Vietnamese producers to remotely join foreign trade expos and work with renowned global e-commerce platforms like Amazon, Alibaba and Global Sources to help the firms cut export promotional costs and introduce their products to global importers and customers, Phu noted./.
Joint support needed for sustainable e-commerce development: insider
Though there remains much room for growth, e-commerce still needs joint support from authorities, businesses, and people to develop healthily and sustainably, said a leader of the Vietnam E-Commerce Association (VECOM).
E-commerce in Vietnam reached a value of over 3 billion USD in 2015, with average annual growth of 38 percent. In 2019, the retail sales of goods and consumer service revenue via e-commerce hit 12 billion USD.
An average growth rate of 29 percent is forecast for the 2015 - 2025 period, according to surveys by the Ministry of Industry and Trade and international organisations.
However, most of e-commerce activities still take place in the two biggest cities, Hanoi and Ho Chi Minh City, which account for 18 percent of Vietnam’s population but more than 70 percent of e-commerce transactions in the country. The 70-percent proportion stayed stable throughout the 2016 - 2019 period.
That means the 61 remaining localities, making up 82 percent of the population, contribute to less than 30 percent of the local e-commerce market, VECOM Vice President Nguyen Ngoc Dung told the Dien dan Doanh nghiep (Business Forum) magazine.
He assessed e-commerce in these localities, especially rural and remote areas, as very modest while more than 70 percent of the population are living in the countryside.
Given this, Dung stressed that although there remains much room for growth, e-commerce still needs joint support from local authorities, agencies, people, business households, and enterprises to develop healthily and sustainably.
In May 2020, the Prime Minister signed off a master plan on e-commerce development for 2021 - 2025 which also aims for e-commerce to be promoted across the country.
This plan targets that by 2025, provincial-level localities other than Hanoi and HCM City will account for 50 percent of the total B2C (business-to-consumer) e-commerce transaction value, and 50 percent of the localities nationwide will have goods sellers or service suppliers online./.
Solutions needed to remove barriers for Vietnamese rice exports
he local rice industry has faced an array of challenges this year caused as the COVID-19 pandemic has disrupted the rice supply chain, thereby negatively affecting export activities, according to industry insiders.
This comes following the sector encountering numerous difficulties in harvesting, transporting, and processing rice for export purposes.
The situation has been attributed to the deployment of social distancing measures enforced under the Government’s directive 16 across southern provinces, a move which has led to congestion in the circulation of rice and goods.
Many production factories have moved to reduce their capacity and have only been able to maintain 50% of their workforce for operations, leading to a labour shortage.
The imposition of social distancing measures has also caused delays in terms of the delivery schedule, along with high transportation costs.
Furthermore, rice traders have suffered from a lack of raw materials to process finished rice, a factor which has affected the fulfilment of signed export contracts.
Moreover, rice stockpiles have also forced the capital flow of rice traders to stagnate as they are unable to continue to purchase rice. The majority of traders are afraid to sign new contracts due to congestion impacting both transportation and delivery at seaports.
According to the Ministry of Industry and Trade, the rice sector is set to face the risk of losing major export markets, especially traditional markets such as the Philippines, China, and Malaysia, all of which will fall into the hands of regional peers such as Thailand and India.
As a means of dealing with this situation, the Ministry has submitted a report to the Prime Minister proposing the urgent consideration of opening a “green channel” for waterway transport. In line with this, no inspections will be carried out at checkpoints in order to facilitate the greater transport of goods to help rice exporters maintain their supply chain for export.
The Ministry also underlined the importance of requiring shipping lines and logistical enterprises to become transparent regarding the costs of transporting containers, while also adjusting the shipping rates to a reasonable level in order to share difficulties with rice businesses.
It also emphasized the urgent necessity of deploying vaccinations for workers who are directly involved in the supply chain.
Statistics compiled by the Ministry of Industry and Trade indicate that the nation has exported 3.492 million tonnes of rice worth US$1.888 billion during the seven months of the year, with an average export price of US$540.68 per tonne.
New decision a legal tool to accelerate equitisation process
The Prime Minister’s newly-issued decision on State capital divestment at enterprises is an important legal tool to accelerate the current sluggish equitisation process of State-owned enterprises (SOEs), said Deputy Minister of Planning and Investment Tran Duy Dong.
Decision No 22/2021/QD-TTg dated July 2, 2021 of the Prime Minister stipulates criteria for the classification of State-owned enterprises and State-invested enterprises undergoing ownership conversion, restructuring and divestment in 2021-2025.
“It helps improves the efficiency of management over the use of State capital in enterprises, at the same time enhances the publicity and transparency in State management in SOEs,” Dong told Viet Nam News Agency in a recent interview.
Dong said that Decision No 22 clearly showed the decentralisation of powers of the Government and the Prime Minister in re-organising State enterprises.
For example, as for parent companies of State-owned corporations, parent companies in groups of parent company-subsidiary companies that are single-member limited liability companies with 100 per cent of charter capital held by the State (hereinafter referred to as "parent companies"), the Prime Minister will directly approve their restructuring plans.
As for subsidiaries in groups of parent company-subsidiary companies that are single-member limited liability companies with all charter capital held by the State, their parent companies have the right to approve their restructuring plans.
Under the decision, the Prime Minister will approve restructuring plans for nearly 500 "parent companies”, such as maintaining an enterprise in which the State holds 100 per cent of charter capital, the State will hold from over 50 per cent to under 65 per cent of charter capital after the equitisation, or the State will hold from 65 per cent of charter capital after equitisation.
Notable names in the restructuring list include the Vietnam Posts and Telecommunications Group (VNPT), Electricity of Vietnam (EVN), The Viet Nam Oil and Gas Group (PVN), Viet Nam National Coal and Minerals Group (Vinacomin or TKV), Viet Nam National Chemical Group (Vinachem), Military Industry-Telecoms Group (Viettel) and the State Capital Investment Corporation (SCIC).
State-owned enterprises after equitisation operated more efficiently as the management and the use of State capital was improved. This was reflected in the growth rates, the results of production and business activities, the average income of employees, the total payment to the State budget, as well as the ability to compete with private enterprises, according to Dang Quyet Tien, Director of the Corporate Finance Department under the Ministry of Finance.
“It is not difficult to recognise the common characteristics of leading enterprises in Viet Nam today, which is they all originated as State-owned enterprises. They are Vinamilk (Viet Nam Dairy Products JSC), FPT (Information-telecommunication-technology group FPT Corporation) or REE (The Refrigeration Electrical Engineering Corporation),” he said.
“They are all improving operational efficiency and always maintain a high capitalisation value,” he said.
“Since switching to a joint-stock company model with the dominant participation of State shareholders, particularly the State Capital Investment Corporation (SCIC) since 2005, SCIC has always shown the role of a large, dynamic and active shareholder of FPT, supporting the company to fulfil its business and production tasks effectively,” said Chairman of FPT Telecom Hoang Nam Tien.
“State-owned enterprises are playing a leading role, paving the way for other economic sectors, especially when the economy recovers after the COVID-19 pandemic,” he said.
The Ministry of Finance said in the first months of this year, the ministry had received equitisation plans of enterprises including the Northern Food Corporation and the Viet Nam National Coal and Minerals Group with a total value of VND252 billion (US$11 million).
Accumulated from 2016 to June 2021, 183 enterprises have been approved for equitisation.
The number of enterprises that must be equitised as planned for the remaining months of 2021 is 89, a goal which is unlikely to be achieved, said the finance ministry.
“Financial problems in the process of business management and administration have not been thoroughly resolved, causing difficulties and delays for the process of equitisation and divestment,” said Dang Quyet Tien, Director of the Corporate Finance Department under the Ministry of Finance.
“Enterprises have not yet improved their operational efficiency. Therefore, the results of production and business activities remain relatively inefficient, making it difficult to attract investors when implementing equitisation,” Tien said.
The total imports-exports value of the FDI sector in the first eight months ofthe year also surged 31.2 percent to 297.43 billion USD, with exports accountingfor 156.64 billion USD./.
Vietnam shares entrepreneurship experience with Algeria
An international conference with the theme of “Algerian economy with a vision to 2030” was organised for the first time in Skikda province on September 25-26, aimed to promote the entrepreneurship among young Algerians.
The conference was organised by the Algerian Youth Association, under the auspices of the Minister in charge of entrepreneurship in Algeria and the Governor of Skikda province, a southern locality which holds potential in oil, agriculture, tourism and seaports.
It attracted a large number of local officials, business leaders and representatives of a number of embassies and diplomatic missions in Algeria such as Poland, Uganda and Zimbabwe.
According to Abdelmalek Benlaouar, President of the Algerian Youth Association, the conference provided an opportunity to enhance the spirit of business among young people and enabled the emergence of a new generation of entrepreneurs and project leaders who have the capacity and ability to penetrate new markets.
It aimed to realise the ambitions of young people, especially business owners who play an important role in promoting national production and exploring foreign markets, and can create a new impetus for the Algerian economy, especially in the post-COVID-19 period, he said.
Benlaouar said the conference was an opportunity to help the country increase exports of non-petroleum products through the signing of trade and investment agreements.
Addressing the event, Vietnamese Trade Counselor in Algeria Hoang Duc Nhuan talked about bilateral trade and investment relations between Vietnam and Algeria, sharing experience and information about the startup environment in Vietnam as well as measures of the Vietnamese government in supporting young people and start-ups in innovation and creativity, especially in the fields of science and technology, e-commerce, media and entertainment.
Nhuan also had meetings with the Director of the Department of Commerce, the President of the Chamber of Commerce as well as businesses of Skikda province to discuss cooperation and investment opportunities between the two countries.
An exhibition displaying local and foreign products in information technology, electronics, farm produce and traditional clothes also took place within the framework of the international conference./.
Special working groups to be set up to assist businesses, people
Prime Minister Pham Minh Chinh has ordered ministries, agencies, and localities to set up their special working groups for tackling difficulties facing businesses and people amid the COVID-19 pandemic.
According to the Government Office, on August 30, the PM issued a decision on the establishment of his special working group for addressing difficulties the COVID-19 outbreak has caused on businesses and people.
To carry out solutions relevant to each ministry, sector, and locality in a timely manner, the PM asked ministries, ministry-level agencies, Government agencies, and provincial-level People’s Committees to quickly set up their special working groups headed by their leaders.
These working groups have to direct the effective implementation of tasks and solutions stated in the National Assembly and the Government’s resolutions, as well as the PM’s directions; proactively coordinate with related ministries, sectors, localities, and agencies; actively grasp information and take timely measures to handle difficulties, obstacles, and proposals; and assist enterprises in their production and business activities to safely and flexibly adapt to the COVID-19 pandemic.
They also need to cut unnecessary administrative procedures while not creating “sub-permits” so as to not adversely affect enterprises’ operations and people’s life, thereby helping to promote socio-economic development and achieve the best possible socio-economic outcomes.
The PM also demanded them make reports on the settlement of difficulties on a monthly basis or when necessary, and propose solutions to the issues beyond their jurisdiction to the Cabinet leader, according to the Government Office./.
Biendong POC’s gas production crosses 15 bln cu.m mark
Bien Dong Petroleum Operating Company (Biendong POC) has produced 15 billion cu.m of gas since its Hai Thach and Moc Tinh gas fields were put into operation in September 2013.
Biendong POC, a subsidiary of the Vietnam Oil and Gas Group (PetroVietnam), has also produced more than 24 million barrels of condensate over the last eight years.
It demonstrates the company’s effort to safely run the fields, apply advanced technology and artificial intelligence (AI) in operation and surmount difficulties caused by the COVID-19.
Its net revenue from the two fields has reached over 3.94 billion USD.
In July, the company reported that its revenue in the first six months of 2021 exceeded the set plan by 4 percent.
Its gas exploitation output reached 41 percent of the yearly plan.
Biendong POC’s total accumulated revenue hit 3.88 billion USD in July, 311 million USD higher than the combined investment and operation cost./.
Vietnam sees surges in pepper exports to France in 7 months
Vietnam exported to France 2,860 tonnes of pepper for 8.18 million EUR (9.6 million USD) in the first 7 months of this year, up 28.6 percent in volume and 44.3 percent in value against a year earlier, according to the Ministry of Industry and Trade’s Agency of Foreign Trade.
France has remained one of the largest pepper buyers in the EU that does not only import pepper for domestic consumption but also for re-export to other European countries.
From January to July, Vietnam’s pepper accounted for 37.2 percent of France’s total imports, an increase from 30.72 percent over the same period last year, and the Vietnamese product fetched higher prices in the European country, the agency quoted data from Eurostat, the statistical office of the European Union, as saying.
In Vietnam, black pepper was sold at 76,000 – 80,000 VND (3.34-3.51 USD) per kg in mid-September, up 2 – 2.7 percent from the end of August. White pepper fetched 119,000 VND in the middle of this month, up 1.7 percent from the end of August and 77.6 percent year-on-year.
Pepper prices are likely to rise further in the coming time as Vietnam is gradually relaxing social distancing measures, prompting traders to increase buying to meeting demand for exports./.
Hanoi views strong disbursement of public funds as major growth driver
Amid the complex COVID-19 situation, accelerating the disbursement of public investment is one of the focal tasks Hanoi will carry out in the remaining months of 2021 to achieve the best possible economic outcomes.
The municipal People’s Committee has demanded district-level People’s Committees take drastic actions to implement measures for promoting economic growth, public investment disbursement, and sustainable export in line with the Government’s Resolution No 63/NQ-CP, according to the Cong Thuong (Industry & Trade) newspaper.
The Hanoi administration asked all-level authorities and sectors to effectively manage and use the budget, reduce regular expenditure to increase local budget reserves, focus on COVID-19 prevention and control, and invest more in performing security - defence tasks and important and urgent activities of the city.
So far, Hanoi has disbursed just 31 percent of this year’s public investment capital assigned by the Government, lower than the rate in the same period last year and the national average.
Given this, the municipal People’s Committee requested leaders of agencies and localities to keep paying attention to the task while tackling difficulties and quickly completing procedures for the projects funded by public capital.
They need to speed up the disbursement progress so as to disburse 100 percent of the assigned public capital, the committee said, asking them to view the disbursement of public funds as one of the important solutions to fuel the city’s economic growth in the remaining months of 2021.
The People’s Committee of Hanoi has also identified some other focal tasks, including piloting the urban administration model, developing five suburban districts (Dong Anh, Gia Lam, Thanh Tri, Hoai Duc, Dan Phuong) into urban districts, and carrying out the Government’s Resolution No 97/NQ-CP, issued on August 28, on reducing power bills and prices for the fifth time since the start of the pandemic.
In August, many local businesses suffered from impacts of the COVID-19 pandemic, with many indexes declining from July and the same period last year.
Hanoi recorded about 1.28 billion USD in exports in August, down 0.7 percent month on month and 34.6 percent year on year. That added up to an eight-month turnover of over 9.78 billion USD, down 5.2 percent from a year earlier.
The index of industrial production (IIP) fell by some 8 percent from the previous month, with the processing and manufacturing sector down 8.8 percent, and electricity production and distribution down 2 percent.
Nevertheless, the index increased 6.3 percent year on year during the first eight months, statistics show.
Total retail sales of goods and consumer service revenue were estimated at 25 trillion VND (over 1 billion USD) in August, down 32.2 percent month on month and 51.2 percent year on year. The sum stood at around 349.5 trillion VND in the reviewed period, down 6.3 percent from the same period last year.
However, the capital city also recorded encouraging outcomes in several aspects.
The January - August State budget revenue was estimated at 164.48 trillion VND, equivalent to 69.8 percent of the target assigned by the Government and 110.3 percent of the figure in the same period last year.
The IIP of some industries still grew strongly during the eight months, including the production of motorised vehicles up 21.6 percent, apparel 18.2 percent, beverage 16.1 percent, timber processing and wood product manufacturing 10.9 percent.
Meanwhile, domestic revenue, except for oil, managed by taxation authorities increased 9.7 percent from a year earlier, with the revenue from production and business activities up 28.9 percent.
Amid complex developments of COVID-19, enterprises in Hanoi have made efforts to sustain operations. Many of them have applied the “three-on-site” model, which involves workers eating, sleeping, and working at factories and taking rotational leave.
Many districts have recorded good progress in public capital disbursement such as Thanh Xuan, Phu Xuyen, Ha Dong, Hoan Kiem, and Cau Giay./.
|Foreign investors keep trust in Vietnam’s recovery|
Vietnam rakes in more than US$3.1 billion from exports to Cambodia
The nation earned US$3.15 billion from exporting goods to the Cambodian market during the opening eight months of the year, representing an annual rise of 16.7%.
Despite this growth, the country ran a trade deficit of USS354.4 million with the neighbouring country throughout the reviewed period.
One of the main reasons behind the trade deficit was increases in import turnover of six main products from the Cambodian market compared to the same period from last year, with imports of cashew nuts and rubber witnessing the highest rises.
Furthermore, the country also spent approximately US$1.83 billion on importing cashew nuts from Cambodia in the first eight months of the year, representing a 7.1-fold increase on-year. In addition, Vietnamese rubber imports from the neighbouring country stood at 5.3 times higher compared to the figure from the same period last year, hitting US$821.8 million.
Vietnamese registered investment in Cambodia reached over US$2.85 billion, primarily in agriculture, including cashew and rubber planting.
Vietnamese businesses also invested in Cambodia as a means of taking advantage of cheap labour costs and favourable conditions in terms of land, climate, and incentives, before also exporting their products back to the nation.
As a means of balancing the trade value with Cambodia, the country is striving to promote processing as a means of improving the added value of export goods, increasing yields and quality of cashew and rubber, whilst also seeking to expand export markets for cashew nuts and rubber products.
Close attention should therefore be paid to strictly controlling the import of these goods in order to ensure origin rules whilst simultaneously intensifying inspection of commodities exported to the country through Cambodia.
Viettel launchs its 5G network in Bà Rịa Vũng Tàu Province
Bà Rịa-Vũng Tàu last week became the eighth locality in the country to get Viettel’s 5G services.
Hoàng Văn Khiêm, director of Viettel in the southern province, said at the ceremony his company was proud to be the first operator to offer 5G services in Bà Rịa-Vũng Tàu.
Trần Văn Tuấn, vice chairman of the province People's Committee, said 5G would help the province quickly deploy digital government projects
Viettel earlier launched 5G services in Hà Nội, HCM City and Thủ Đức City and Bắc Ninh, Bắc Giang, Bình Phước, and Thừa Thiên-Huế provinces.
The company is set to take its 5G services to more provinces and cities.
Hybrid trade events push nation’s brand
The end of last month saw a successful hybrid trade exhibition, at which Singaporean and Vietnamese partners could establish new relations and long-standing partnerships – both of which can profit from these markets as mutual dependencies can be utilised.
The Vietnamese Embassy to Singapore, the Vietnam Trade Promotion Agency (Vietrade) under the Ministry of Industry and Trade (MoIT), and the Vietnam Trade Office in Singapore have deployed solutions to support businesses and solve difficulties in the country, as well as expand the export markets for Vietnamese products, especially agricultural goods that are highly processed and offer high added value.
Among these goods are Vietnamese lychee, which has been present in the Singaporean supermarket system since last year. In its first export season, Vietnam became the fourth-largest lychee exporter to Singapore, surpassing major exporter Madagascar.
Also last year, lychee entered the list of the top 10 fruit and vegetable exports of Vietnam to Singapore. In that market’s supermarkets, Vietnamese lychee is always in short supply, competing well with Chinese lychee despite their higher prices.
The pandemic has hurt global supply chains and international trade, causing difficulties for businesses on all sides, from lack of supply and rising transport prices to border closures and interrupted shipping operations. With its strengths in digital technology and e-commerce, Singapore is committed to continuing to promote trade flows, especially with Vietnam.
Hybrid events are the new approaches amid the pandemic. The MoIT in coordination with the Vietnamese Embassy of Singapore and Singapore’s Ministry of Industry and Trade co-organised “Vietnam’s National Brands Weeks 2021 in Singapore – Hybrid Expo on Halal and Processed Food Products”, which was a practical example of this kind of event. This was the very first hybrid exhibition for Vietnam organised overseas, featuring physical product displays and online business-to business matching. It was also the first time the Vietnamese government’s National Branding Programme was widely promoted to the Singaporean business community and multinational companies based in the nation.
The exhibition was held on August 23-28, both online and offline. To ensure the highest connection efficiency and safety for visitors, businesses were arranged in groups of no more than eight people, and Zoom tables were established with Vietnamese businesses with the support of Vietrade and the Vietnam Trade Office in Singapore.
The exhibition offered promotion opportunities for a variety of high-quality Vietnamese products to Singaporean importers, who could connect and explore new partnerships with manufacturers from Vietnam.
Do Thang Hai, Deputy Minister of Industry and Trade, said that this event was an important milestone of the trade cooperation between Vietnam and Singapore, and an asserting premise for the cooperative spirit of the upcoming MoU between the ministries of Industry and Trade of both countries.
Mai Phuoc Dung, Vietnamese Ambassador to Singapore, said, “Promoting agricultural trade cooperation, Vietnam and Singapore wish to ensure supply chain stability and food security for the people. The exhibition was a testament to Singaporean and international friends of the Vietnamese government and businesses to promote trade flows and avoid supply disruptions.”
Vietnam’s agricultural products have now many opportunities to develop in Singapore. The city state advocates a relatively open import policy, with more than 150 export partner countries. As the state has almost no agriculture on its own, Singapore depends largely on imports to ensure the domestic demand.
Douglas Foo, chairman of the Federation of Singapore Manufacturers, said that the country has always had to work to ensure supply. Meanwhile, Vietnamese manufacturers met difficulties in output targets for their products amid current restrictions.
“Thus, the cooperation is a win-win for both countries,” said Foo. “The exhibition has created opportunities for Singaporean businesses to understand more about Vietnamese brands and products, and build a sustainable supply chain.”
The exhibition was also the first in which Singaporean organisations could receive more information about the Vietnam Value Programme and its national brands.
Tan Lijin, director of the Singapore Commodity Exchange, found that Vietnam’s processed products are accounting for an increasing value in the share of global agricultural trade. Lijin believed that Vietnamese exporters will have many opportunities and new ways to access international markets, including online auctions.
Various provinces could benefit from Singaporean food producers
The Mekong Delta province of An Giang is famous for many kinds of agricultural export goods. Tran Anh Thu, Vice Chairman of An Giang People’s Committee, said that the pandemic has affected enterprises, and disturbed the export market. “The supply chain for agricultural goods has an urgent need for appropriate adjustments to be able to offer its products to the market,” Thu said.
During the peak of the pandemic, export activities to major markets such as China, South Korea, Japan, the United States, the European Union, and ASEAN took place very slowly and fell sharply in volume, mainly due to travel and trade restrictions, leading to mass cancellations of export contracts.
The potential for cooperation with Singapore’s food producers could be a catalyst for provinces like An Giang as both, Vietnam and Singapore, have many free trade agreements with the EU and the United Kingdom.
Singapore has a duty-free export quota of 50,000 tonnes for processed foods to the European continent. Therefore, Singaporean groups are very interested in sourcing raw materials from Vietnam to take advantage of the principle of origin.
Singapore is also a major halal food supplier to the world, with an ever-expanding market share. Tran Thu Quynh, Vietnam’s trade counsellor in Singapore, thinks these are opportunities for Vietnam to do outsourcing for Singaporean brands. “If we can make good use of these advantages, the prospects for Vietnam’s agricultural products will be better and better,” Quynh said.
“However, right now Vietnamese businesses are paying little attention to this market, due to its small capacity and high requirements on standards, quality, and price,” Quynh commented.
According to her, there are three potential groups of products for Vietnamese enterprises to export to the Singaporean market, namely agro-fishery products such as vegetables, cashew nuts, rubber, and processed foods; raw materials and minerals such as coal; and processed goods like confectionery, chemicals, wood products, and toys and sports equipment. “Vietnamese exporters need to actively participate in trade promotion activities held in Singapore to introduce and promote their products,” Quynh advised, adding that in order to increase exports to Singapore, local companies need to improve their competitiveness, build brands, invest in technology, and add value to their export products.
Moreover, Quynh recommended that enterprises focus on standards for post-harvest preservation, packaging design, user manuals, and product quality, all the while improving quality and reputation, as well as ensuring food hygiene and safety standards.
Whenever the pandemic is controlled in Southeast Asia, businesses can restart to build brands, maintain stable export activities, and bring Vietnamese goods into foreign distribution channels through trade promotion activities.
“For this, the online channel is very important,” said Do Phuong Dung, deputy director of the Asia-Africa Market Department under the MoIT.
However, Vietnamese businesses “still lack information about their trading partners, needs, tastes, and market capacity, as well as trade policies and import and export regulations,” Dung commented.
According to Dung, businesses must improve the quality of products and services, and establish professional production processes in accordance with regional and international standards. Moreover, Dung advised local businesses to dare to cope with international integration and reach out to big markets. By doing so, local companies could establish prestigious Vietnamese brands in the regional and international arenas.
HCMC proposes tax, interest rate reductions to support businesses
The People's Committee of Ho Chi Minh City has just contributed some opinions on the reduction of corporation tax, value-added tax, and land rent, the extension of tax payment deadlines, and interest rate support to the draft Decree stipulating some solutions to support enterprises and people affected by the Covid-19 pandemic.
The HCMC People's Committee will send these contents to the Prime Minister and the Minister of Finance to supplement and include them in the draft to summarize and submit to the Government.
Specifically, HCMC proposed to reduce 50 percent of corporate tax in 2021 and continue to cut 30 percent of corporate tax in 2022 and 2023 for businesses with annual revenue of less than VND200 billion; allow all costs related to pandemic prevention and control of enterprises, such as costs for Covid-19 testing and medical treatment (if any), food and living expenses, personal protective equipment, including masks, face shields, and disinfectants, and hotel costs for isolation, to be deducted from the expenses of corporation tax.
Regarding taxes for business households and business individuals, the city proposed that they are exempt from personal income tax, value-added tax, special consumption tax, tax on natural resources, and environmental protection tax arising from production and business activities in the third and fourth quarters of 2021, in 2022, and 2023. At the same time, it proposed to exempt the personal income tax for laborers with incomes from wages and salaries subject to tax payment of levels 1 and 2.
HCMC also asked to reduce the value-added tax rate by 50 percent (or the percentage rate) of the last three months of 2021 and the years 2022 and 2023. At the same time, it suggested extending the tax payment deadline until the end of the second quarter of 2022 and slap no penalties for late tax filing in 2021 due to the impact of social distancing following Directive No.16 of the Prime Minister. Local tax authorities actively carry out within their power and do not require taxpayers to make an application.
As for land rent, HCMC put forward to lower land rent by 50 percent in 2021 for all businesses. As for those in the tourism and tourism-related industries, land rent in 2021 will be cut 100 percent. Regarding interest rate support for businesses, HCMC proposed the Prime Minister and the Minister of Finance to add clauses assigning the State Bank of Vietnam to cut the lending interest rates for businesses in the direction that the lending interest rate is not 2 percent higher than that of deposit interest rate; have policies to support loans for refinancing, working capital for production and business activities, guarantee payment for raw material purchase and sale contracts at zero percent interest rate for difficult businesses affected by the Covid-19 pandemic; simplify procedures for support, preferential loans, and debt payment extension, to the draft.
Source: VNA/VNS/VOV/VIR/SGT/SGGP/Nhan Dan/Hanoitimes
Vietnam’s seaports handle over 537.7 million tonnes of goods in nine months