VIETNAM'S BUSINESS NEWS HEADLINES AUGUST 11

Fierce competition in retail market

VIETNAM'S BUSINESS NEWS HEADLINES AUGUST 11

The Vietnamese retail market has seen some exciting mergers and acquisitions (M&A) in addition to electronic commerce in 2019 and early 2020 resulting in fierce competition in the market. 

Soon after Vietnam participated in the World Trade Organization, the Southeast Asian country has been ranked as one of the most attractive retail markets. With its population of nearly 100 million people, 70 percent of them  at the working age and 34 percent of them  in urban areas and the fastest-growing middle class in Southeast Asia, Vietnam has become an ideal market; therefore, giant retail corporations such as Metro Cash & Carry, Casino Group, Parkson, Auchan, 7-Eleven, Aeon, Lotte Mart have flocked to the Southeast Asian country.

Locally, in addition to familiar brand names including Saigon Co.op – investor of Co.opmart, Co.op Food, The Gioi Di Dong, Nguyen Kim, FPT Shop, Hapro Mart, newcomers namely VinGroup with Vinmart, Vinmart+, Bach hoa Xanh ( Green Grocery) jumped into the market.

The presence of local and international retailers has changed the market dramatically. Commercial centers and supermarkets have been booming gradually replacing traditional business.

However, some retailers are exhausted in the intense competition leading to many mergers and acquisitions (M&A) with high value; specifically, Pakson (Malaysia), Metro Cash & Carry (German), Casino Group (France), and Maximark (Vietnam)...

In 2019, Saigon Co.op has bought out French company Auchan Retail’s operations in Việt Nam, which include 15 retail stores and an e-commerce platform. Private conglomerate Vingroup acquired supermarket chain Queenland Mart in last September. Especially, in December, 2019, Masan took over Vingroup retail subsidiary including VinMart, VinMart+ and VinEco.

Along with mergers and acquisitions, many enterprises have operated sporadically with low growth; for instance, 7-Eleven expected to open 100 outlets by 2020 but it has opened just 30 stores in Vietnam and GS25 planned to open 2,500 stores countrywide ten years after January 19, 2018 when it opened first outlet; but in fact, it has opened more than 50 stores so far.

First months of 2020, retailers raced relentlessly to open online business because of social distancing due to Covid-19 crisis.

For sustainable development, retailing systems such as Co.opmart, Big C, Vinmart, Aeon, Emart have spent more on e-commerce. Each supermarket all has hot line so that customers can order commodities through phone.

Statistically, revenue from online sale in first six months has risen by 20 percent -40 percent compared to the same period last year; particularly, turnover of food and foodstuff, cosmetic has skyrocketed by 100 percent.

Distribution stores of state-owned food processor Vissan not only sell goods through phones and portal but also cooperates with e-commerce platform like Sendo and Now to diversify its distribution channels.

Additionally, supermarkets have sold more commodities and combined entertainment areas to satisfy demand of customers of all age. For example, Shopping Mall, Omni-channel have been favorite places for shoppers because they offer customers’ shopping and entertainment demand.

part from that, convenience store to provide food and foodstuff, essential commodities also meet consumers’ needs. Take Saigon Co.op as an example. Saigon Co.op is focusing on investment in Co.opmart supermarket chains and retail stores including Co.op Food, Co.op Smile.

The competition in retail industry has been more fierce in the time when consumers tighten their spending due to Covid-19 impacts. To compete each other, retailers will renovate continuously comprising using IT and having business strategies to attract customers.

Vietnam food, drink and textile manufacturers among largest beneficiaries of EVFTA

This is the second FTA that the EU has ever made with a Southeast Asian country, after Singapore.

Food, drink and textile exporters in Vietnam and the EU will be some of the largest beneficiaries of the EU – Vietnam Free Trade Agreement (EVFTA) that came into effect on August 1, according to Fitch Solutions, a subsidiary of Fitch Group.

The EU Parliament ratified the trade deal and the EU – Vietnam Investment Protection Agreement (EVIPA) in February 2020 and the Vietnamese parliament did so on June 8, paving the way for the EVFTA to become effective in August.

This is the second FTA that the EU has ever made with a Southeast Asian country, the first being Singapore.

The terms of the EVFTA mean that the EU will eliminate approximately 71% of duties on imports from Vietnam, from day one, while 99% of all products and services will enter duty-free after seven years. Vietnam will lift 49% of its import duties on EU exports from day one and will phase out the rest over the next 10 years.

In terms of tariff eliminations by the EU for Vietnam's products, fishery products will see a reduction from the current 60.2% to 1.9% by 2027. Similarly, processed agricultural products have tariff reduction from the current 37.2% to 2.1% by 2027. There are also favorable market access preferences, in the form of duty-free tariff rate quotas, granted by the EU to Vietnam, stated Fitch Solutions.

For manufacturers in clothing and footwear industries, the EU will eliminate duties with longer staging periods (up to seven years) for some sensitive products, especially in the textile apparel and footwear sectors.

To benefit from the preferential access, the strict rules of origin for garments will require the use of fabrics produced in Vietnam, with the only exception being of fabrics produced in South Korea (another FTA partner of the EU).

Regarding alcoholic drinks, the wine and spirit sectors of both EU and Vietnam’s markets will be liberalized after seven years.

Meanwhile, Vietnamese seafood will improved market access via duty-free tariff rate quotas or full liberalization. This includes surimi (500 tons); canned, fresh and chilled tuna (11,500 tons); non-processed shrimp will be liberalized from day one; and catfish will be liberalized in three years.

A pre-Covid-19 study from Vietnam’s Ministry of Planning and Investment suggested the EVFTA and EVIPA would help Vietnam’s GDP grow an additional 4.6% and boost the country’s exports to the EU by 42.7% by 2025.

Meanwhile, the European Commission estimated the bloc’s GDP would be added US$29.5 billion by 2035, along with additional growth of 29% in exports to Vietnam. 

Vietnam GDP growth predicted to expand 3.1% in 2020: AMRO   

AMRO remains optimistic about the Vietnam's outlook, thanks to the country's effective anti-virus measures and favorable structural economy.

Vietnam’s GDP growth for this year is predicted at 3.1% in 2020 and bounce back to 7% in next year, according to the ASEAN+3 Macroeconomic Research Office (AMRO), a regional macroeconomic surveillance organization in the ASEAN+3 region (plus China, Japan and South Korea).

 
These figures are significantly lower than AMRO’s previous prediction in March at corresponding 6.6% and 6.8%, but remained highest in the region.

Hoe Ee Khor, AMRO’s chief economist, said at the online launch of the report on August 6 that while the GDP growth forecast for Vietnam did not take into account the recent Covid-19 resurgence in Danang, the office remains positive about Vietnam’s outlook, given its efficient measures against the pandemic and the 100-day period without any new Covid-19 cases.

Vietnam’s structural economy is different to countries like Thailand, set to suffer a contraction of 7.8% this year, for which the latter’s two main driving forces of tourism and auto industry have been badly hit by the pandemic.

According to Khor, some major industries in Vietnam, including electronics production and textile are less affected by the pandemic. Additionally, the country continues to receive large amount of foreign direct investment and is among major beneficiaries of a shift in investment capital from China.

However, it remains to be seen how the outbreak in Danang turns out, he added.

The World Bank in late July predicted Vietnam’s economic growth at 2.8% this year, the fifth fastest-growing economy globally.

Meanwhile, the Covid-19 pandemic continues to cause severe economic impacts among countries in the region. The average GDP growth rates of ASEAN+3 in this year and next have been revised down to 0.1% and 6% compared to 4.2% and 5% reported in March.

The recovery is anticipated to follow a gradual U-shape, led by China, which is projected to grow by 2.3% this year compared to 6.1% in 2019, while nine of the 14 ASEAN+3 member economies are expected to contract in 2020, including Japan and South Korea, stated the report.

Countries that are expected to maintain positive economic growth this year are China, Brunei, Laos, Myanmar and Vietnam.

However, this trajectory assumes that any unwinding of policy measures proceeds smoothly, and is predicated on the effective containment of the Covid-19 pandemic, both regionally and globally, it added.

AMRO’s report stated the biggest challenge facing ASEAN+3 policymakers will be balancing the tradeoff between easing restrictions to revive the economy and risking a second or even third wave of infections.

For the region to open up fully, the virus must be fully contained in all countries. Otherwise, it will spread from the infected countries to others, and there will be another round of lockdowns, which the region can surely ill-afford, the report asserted.

Hanoi to call for EU investment in pharmaceutical and hi-tech industries: Mayor   

The EVFTA is an opportunity for Hanoi to boost cooperation in trade and investment with EU member countries, said Hanoi’s mayor Nguyen Duc Chung.

As the EU – Vietnam Free Trade Agreement (EVFTA) has come into force, Hanoi plans to promote investment from European countries, focusing on pharmaceutical, supporting and hi-tech industries, according to Chairman of the municipal People’s Committee Nguyen Duc Chung.

The trade deal is an opportunity for Hanoi to boost cooperation in trade and investment with EU member countries, Mr. Chung said at an online conference regarding the implementation of the EVFTA on August 6.

According to Mr. Chung, 23 out of 27 EU countries are investing in Hanoi with registered capital of a combined US$4.16 billion, or 10% of total foreign direct investment (FDI) in the city to date.

The majority of European businesses in Hanoi are operating in the supporting industries and manufacture of hi-tech products, Mr. Chung informed.

In the anticipation of the EVFTA, Mr. Chung said Hanoi has drafted an action plan for comprehensive investment and cooperation programs between Hanoi and EU countries, especially those with a long-standing relations with the capital city.

To continue attracting FDI from EU, Hanoi would focus on reforming administrative procedures and the business environment, Mr. Chung suggested.

Mr. Chung noted one of the city’s priorities is to support local small and medium enterprises (SMEs) in taking part in technology transfer, acquiring new technologies and joining the Industry 4.0 for higher quality of products and services.

While the tourism industry has been severely affected by the pandemic, Hanoi identifies the EU as a major market and would continue to attract European tourists in the post-Covid-19 period, Mr. Chung added.

Over the past two years, while the rate of goods and products from foreign-invested enterprises exported to the EU market has gone down from 55% to 46%, that of Hanoi’s firms has increased from 46% to 54.5%. This suggested enterprises in Hanoi have been investing in technologies and renovating their production methods to adapt to requirements of EU market, Mr. Chung asserted.

Hanoi’s authorities would continue to support local enterprises in enhancing competitiveness to meet the EU’s strict requirements, Mr. Chung stated.

The EVFTA took effect on August 1 following the green light from the European Parliament on February 12 and a similar decision from Vietnam’s National Assembly on June 8.

The EVFTA, officially signed last June after six years of negotiations, has been dubbed the most ambitious FTA the EU has ever reached with a developing country, according to the European Commission. It not only includes the almost full elimination of bilateral tariffs, but also a substantial reduction of non-tariff barriers. Moreover, it includes provisions to protect intellectual property, labor, environmental standards, and fair competition, while promoting regulatory coherence. 

IFC provides US$140 million to help VN’s firms affected by COVID-19

The International Finance Corporation (IFC) is extending US$140 million in total financing to two Vietnamese commercial banks to help them support businesses, especially small- and medium-sized enterprises (SMEs), that have suffered from the COVID-19 pandemic. 

The International Finance Corporation (IFC) is extending US$140 million in total financing to two Vietnamese commercial banks to help them support businesses, especially small- and medium-sized enterprises (SMEs), that have suffered from the COVID-19 pandemic. 

The IFC will provide US$100 million to VPBank and another US$40 million to Orient Commercial Joint Stock Bank (OCB) in one-year, renewable senior loans to enable local businesses with disrupted cash flows to sustain operations and maintain jobs.  

The development finance institution is also partnering with international lenders, including the Asian Infrastructure Investment Bank (AIIB), to raise additional financing to expand VPBank’s lending capacity further. AIIB will co-finance up to US$100 million to support VPBank’s COVID-19 relief initiatives to its business customers. 

“SMEs are strategic client segment to VPBank and we have continuously offered various solutions to their needs given the ongoing pandemic, said Nguyen Duc Vinh, CEO of VPBank.   

Abour 20% of the working capital line for VPBank is expected to be earmarked for women-led SMEs, with blended finance funding provided by the Women Entrepreneurs Opportunity Facility, a first-of-its-kind global finance facility for women entrepreneurs launched by IFC and Goldman Sachs 10,000 Woman.   

|SMEs are “the backbone of Viet Nam’s economy”, said Nguyen Dinh Tung, CEO of OCB, adding that as they struggle amid the ongoing COVID-19 situation, IFC’s timely and rapid support will play a significant role in helping them cope with this unprecedented global crisis, contributing to an economy recovery process that is resilient and sustainable. 

The loans to VPBank and OCB are part of IFC’s US$8 billion fast-track financing to support its private-sector clients during the COVID-19 crisis. 

“Our experience from past shocks, including the global financial crisis 2008, has taught us that micro, small and medium enterprises are especially impacted by the current crisis. Keeping them solvent it, therefore, key to saving jobs and limiting the economic damage”, said IFC country manager for Viet Nam, Cambodia and Laos, Kyle Kelhofer.

Both VPBank and OCB are exiting clients of IFC. The World Bank Group’s investment arm extended US$212.5 million financing package to VPBank in January this year and US$100 million funding to OCB earlier.  

According to the General Department of Statistics’ survey results of assessing the impact of COVID-19 on production and business activities of enterprises in Viet Nam, there were 85.7% of enterprises nationwide affected by COVID-19. 

57.7% of those thought that the consumption market went down sharply. 22.1% of respondents were in shortage of inputs. 45.4% of respondents were in shortage of financing for their business operations.

The survey was conducted from 10 April to 20 April 2020 in the online manner, with 126,565 responding firms, accounting for 20% of the total operating enterprises.

Revenue of retail sales and services rises in July

Vietnam’s revenue of retail sales and services in July was estimated at 431.9 trillion VND (18.6 billion USD), up 3.3 percent over the previous month and up 4.3 percent from the same period last year, according to the General Statistics Office (GSO).

Trade and service activities in July continued to increase due to policies on stimulating domestic consumption and tourism, along with government support packages to help people reduce the burden of spending.

This was also the month during the summer vacation of students, so many families travelled in the country.

Revenue reached 333.8 trillion VND from retail sales, up 2.6 percent month on month and up 7 percent year on year; 48.2 trillion VND from accommodation and food services, up 9.2 percent month on month but down 4.4 percent year on year; and 1.5 trillion VND from tourism, up 29.6 percent month on month but down 59.7 percent year on year.

In the first seven months of this year, total revenue of retail sales and services was 2.8 quadrillion VND, down 0.4 percent over the same period last year.

If excluding the price factor, the total revenue decreased by 4.8 percent year on year while in the first seven months of last year, it gained an increase of 9 percent year on year.

Of which, the revenue of retail sales in the first seven months reached 2.2 quadrillion VND, accounting for 79.2 percent of the total. It rose by 3.6 percent over the same period last year because July was a promotional month to stimulate domestic consumption, increase market shares and restore the domestic economy affected by the COVID-19 pandemic.

The revenue of accommodation and catering services in the first seven months was estimated to reach 280.9 trillion VND, accounting for 10 percent of the total. It was down 16.6 percent over the same period last year.

Localities having strong reductions in revenue of accommodation and catering services included Khanh Hoa (59.1 percent), Ba Ria-Vung Tau (46.5 percent), HCM City (45.1 percent), Can Tho (27.5 percent), Da Nang (24.5 percent), Thanh Hoa (21.5 percent) and Hanoi (18.9 percent).

The tourism revenue in the seven months was estimated at 11.1 trillion VND, down 55.4 percent over the same period last year.

Some localities had a sharp decrease in tourism revenue included Khanh Hoa (76.4 percent), HCM City (74.9 percent), Ba Ria - Vung Tau (63.3 percent), Da Nang (58.6 percent), Can Tho (57.1 percent), Quang Ninh (50.5 percent), Quang Binh (48.6 percent), Hanoi (38.6 percent), Thanh Hoa (38.5 percent), Binh Dinh (38 percent) and Hai Phong (23.7 percent)./.

Wood, wooden product exports rise 6.2 pct.

Wood and wooden product exports hit 1.05 billion USD in July, bringing the figure to 6.09 billion USD in the first seven months of this year, a year-on-year rise of 6.2 percent, the Ministry of Agriculture and Rural Development (MARD) has revealed.

Imports by the sector neared 1.31 billion USD in the seven-month period, down 10.3 percent compared to the same period last year. It therefore posted a surplus of 4.78 billion USD.

The US, China, Japan, and the Republic of Korea remained the top four export destinations, accounting for the lion’s share at 84 percent.

Vietnam’s plywood industry has grown at an average rate of 31 percent annually in the last five years, according to the Agro Processing and Market Development Authority at MARD. There are now 42 FDI projects in the country’s plywood industry.

With the EU-Vietnam Free Trade Agreement having taken effect in August, Vietnam expects to see wood and wooden product export revenues increase 17 percent as tariffs are lifted./.

Vietnam exports nearly 4m tonnes of rice in seven months 

Việt Nam exported 3.9 million tonnes of rice, earning US$1.9 billion, in the first seven months of this year, according to the Department of Agro Processing and Market Development under the Ministry of Agriculture and Rural Development.

Export volume fell 1.4 per cent but increased by 10.9 per cent in value over the same period last year.

The department also said that in the first half of this year, the Philippines ranked first in Việt Nam's rice export market with nearly 37 per cent of total rice exports.

Việt Nam exported 1.4 million tonnes of rice to the Philippines, earning $635 million, up 13.3 per cent and 30.5 per cent, respectively, over the same period last year.

Other markets with strong growth in rice exports included Senegal (up 19.6 times), Indonesia (2.8 times) and China (nearly 90 per cent).

Việt Nam’s average rice export price in the first six months hit $487.6 per tonne, 13 per cent higher than the same period in 2019, reported Tiền phong (Vanguard) newspaper.

According to the department, on the world market, the export price of Thai rice in July fluctuated between $440-515 per tonne. Việt Nam’s rice export prices in the month were between $415 – 457 per tonne. The export prices of Indian rice were between $373 and 382 per tonne.

19 VN businesses join ASEAN Online Sale Day 2020

As many as 215 businesses from 10 ASEAN countries, including 19 from Vietnam will take part in the ASEAN Online Sale Day 2020, the first of its kind to be held in the region on August 8, to mark the 53rd founding anniversary of the group.

Joining the event will be major Vietnamese electronic trading floors such as Lazada, Shopee, Fado, Tiki, Thegioididong, Accesstrade, Viettel Post, VNPay, ZaloPay, Bibica, Bitis, and Sunhouse. 

Customers have the chance to purchase typical products such as tea, coffee and silk which will be shipped across the region free of charge.  

Notably, Lazada, Shopee, Fado and Tiki are poised to launch special promotion sales on this occasion to welcome the regional online shopping event.

ASEAN Online Sale Day is designed to realize the ASEAN Agreement on E-commerce, creating a prerequisite for the development of cross-border e-commerce.

The event aims to help businesses in Vietnam and other ASEAN countries to popularize the online shopping model during the epidemic time. It will be held annually to promote cross-border e-commerce.

58 containers of pepper re-exported from Nepal

Vietnamese businesses have been granted permission to receive back 58 containers of pepper after they had been left stuck in Birgunj port in Nepal and Kolkata port in India.

The Nepal Ministry of Industry, Commerce and Supplies submitted a document requesting that the Customs Department of Nepal permit Vietnam to re-export the consignment of pepper. 

Since the submission of the document, the majority of pepper shipments have been granted the No Objection Certificate by the Customs Department of Nepal.

Previously, a number of Vietnamese pepper exporters had faced difficulties in attempting to export the product to Nepal. Indeed, many of their items didn’t receive clearance after it emerged that the firms based in Nepal had failed to apply for import permits while also refusing to receive the shipments.

Vietnamese businesses are now contacting Nepali shipping agents in order to get the shipments from Nepal, with the clearance of the containers expected to put an end to the storage costs incurred by the enterprises.

Once the shipments return, they will be able to continue being exported to other markets in order to take advantage of the high price for pepper exports at present.

Public debt of Laos predicted to increase amid COVID-19

The public debt of Laos may increase to as much as 65 to 68 percent of its gross domestic product (GDP) in 2020 following a sharp fall in national revenue collection alongside an increase in loans due to the COVID-19 pandemic, Vientiane Times reported.

Revenue collection by Laos in 2020 will decrease by about 6.32 trillion kip (696 million USD), Finance Minister and Lao Deputy Prime Minister Somdy Douangdy said at the recent ninth session of the eight National Assembly.

The value of exports during the first six months of 2020 were at a low level of around 2.6 billion USD, a decreased of 5.1 percent compared to the same period of 2019, according to an assessment by an agency of the Ministry of Industry and Commerce.

Important sectors, especially processing industries and construction, showed a decreasing trend. This included falls in cement, gold and copper production.

The exports of several products, such as clothes, cassava, bananas, coffee, wood pulp, paper and electronic equipment, are expected to be heavily impacted.

Investments are expected to decrease. The value of approved investments through the concession system in the first five months of 2020 was only 151 million USD, as against 2.38 billion USD for the same period of 2019.

The tourism sector too is expected to be further impacted during the last six months of the year, as the number of tourist arrivals in Laos in the first six months was only 887,447, a decrease of 60 percent compared to the same period of 2019.

Philippines' economy plunges into technical recession

The Philippines has plunged into a technical recession as the economy dropped 16.5 percent in the second quarter of 2020, the lowest recorded quarterly growth since 1981.

In an online meeting on August 6, the Philippine Statistics Authority (PSA) said the economy contracted by 16.5 percent during the April to June period, following the downward-revised -0.7 percent in the first quarter of the year, and 5.4 percent in the second quarter of 2019.

 

According to the PSA, in the second quarter, both industry and services declined 22.9 percent and 15.8 percent, respectively.

The main contributors to the decline were manufacturing, 21.3 percent; construction, 33.5 percent; and transportation and storage, 59.2 percent.

Among the major economic sectors, agriculture, forestry, and fishing increased with 1.6 percent growth.

According to experts, the economic slowdown was partly because of the April - May coronavirus lockdown.

In mid-March, the Philippines imposed a lockdown in Metro Manila and other parts of the country to curb the spread of the virus.

EVFTA offers new prospects to European economies

The EU–Vietnam Free Trade Agreement (EVFTA), which came into effect on August 1, not only opens up opportunities to spur Vietnam's economy but also offers new prospects to European economies at a time of global financial uncertainties, according to the German press agency DPA.

In a recent article, the agency quoted Vietnamese Prime Minister Nguyen Xuan Phuc as saying that the deal "opens up opportunities" to boost Vietnam's economy.

In an opening speech at a video conference to optimise the deal, PM Phuc urged authorities to ensure international labour standards are met and measures are taken to protect the environment. He also expressed hope that the agreement will ensure Vietnam's products meet European standards and increase jobs.

Jean-Jacques Bouflet, Vice Chairman of the European Chamber of Commerce in Vietnam, was also cited as saying that in a recent survey, 74 percent of European business leaders said the EVFTA will have a positive impact.

"Currently, worldwide business activities are seriously affected by COVID-19," Bouflet said at a trade forum on July 31. "The EVFTA will promote trade and investment, create long-term opportunities and shape the relationship between the EU and Vietnam over the next ten years."

He added that the EVFTA will provide EU enterprises with the chance to access one of the most vibrant consumer markets in Southeast Asia and compete on equal terms with other countries that have signed free trade agreements with Vietnam like Japan and the Republic of Korea (RoK), the article said.

The EVFTA has also made headlines in newspapers in Europe, which stressed great opportunities for European firms to access Southeast Asia.

Austria’s Industriemagazin.at magazine cited Secretary General of the Austrian Federation of Industrialists Christoph Neumayer as saying the agreement is another building block for domestic and European companies to gain access to important future markets. This applies in particular to Vietnam, which is part of the fast-growing ASEAN region with more than 600 million people.

Other news sites and newspapers of Germany like onvista.de, nuernberger-blatt.de and Neues Deutschland also ran articles highlighting the deal, and trade ties between Vietnam and the EU.

Planning on Red River banks needs work

Hanoi has created urban development plans for the banks of the Hong (Red) River, yet problems remain due to lack of flood and dyke planning.

Planners have been seeking solutions to balance sustainable development with land and water resources.

In 2006, the Ministry of Agriculture and Rural Development submitted a plan to the Government on flood prevention and control and dyke system reinforcement on the Red and Thai Binh rivers, reported Kinh Te Do Thi (Economy and City) newspaper.

Under the plan, it was necessary to move 855,993 people who lived on an area of 12,504ha on riverbanks to ensure safe flood discharging.

The areas for housing were below 15 percent of the river banks in Tam Xa- Xuan Canh and Long Bien-Cu Khoi areas in Hanoi.

The plan, which was approved but has not yet been carried out, was estimated to cost 113 trillion VND (4.9 billion USD). Along with funding from the State budget, revenue was to be drawn from the auction of land use rights in the river bank or investment in the public-private partnership (PPP) form.

This meant money collected from using the land would be used for flood drainage, so the area for flood drainage would be reduced to be used as housing, making flood drainage less safe.

The flood drainage corridor which was built by French irrigation engineers in 1905 has been degrading yearly.

For example, before merging with Hanoi, Ha Tay province allocated tens of thousands of hectares of land in the flood drainage corridor to real estate developers.

At present, many rivers in Hanoi and other provinces in the Red River Delta have been seriously polluted, which has caused a shortage of water for farming.

These issues have left Hanoians awaiting proper planning along the Red River to effectively use land and water for sustainable agriculture.

The section of the Red River flowing through Hanoi is more than 120km.

The riverbank is a large area so Hanoi could choose 1 or 2km alongside the river to carry out a trial planning project.

Recently, a group of Vietnamese and international urban planners proposed a plan for zoning a safe area which could ensure sustainable development for urban areas, farming and the environment.

The safe area would be protected by a concrete dyke system.

Residents currently living nearby the mudflats would be reallocated to at least 20m above sea level, freeing up the entire ground space and creating an extra 50-80ha for drainage in the flood season.

The river mudflats, which feature beautiful trees, would become a new park among hundreds of hectares of water surface of the river.

In the dry season, this place would be a safe and green park while in the flood season, it would be a training field for militia and youth volunteers to practice swimming and rescuing activities.

The plan is expected to create public assets worth billions of dollars, increase dynamism for the local economy and generate millions of new jobs for Hanoi and neighbouring provinces.

The same plan was carried out in some riverside cities of China like Wuhan, said the newspaper.

Additionally, the solution meets the essential requirements of flood prevention and dyke protection, adapting to extreme climate change at the highest level.

At present, wastewater does not flow into the city’s sewers but directly into the Red River, meaning Hanoi needs to plan for wastewater collection to eliminate pollution source in the river.

Bac Lieu expands sustainable shrimp farming

Aquaculture production in the Cửu Long (Mekong) Delta province of Bạc Liêu, particularly high-tech shrimp cultivation, has developed well in recent years because of investments in several kinds of farming models, according to the province’s Department of Agriculture and Rural Development.

The province has 13 companies that have invested in high-tech shrimp farming models such as intensive farming under Vietnamese good agricultural practices (VietGAP) standards and super-intensive shrimp farming.  

Other models like rotating the breeding of shrimp in the dry season and growing rice in the rainy season on the same rice field, and the breeding of shrimp in mangrove forests, have been efficient and have helped to protect the environment.

The province bred or caught a total of 403,000 tonnes of seafood in the first seven months of the year, including 203,000 tonnes of shrimp, meeting more than its target for the period, according to the province’s People’s Committee.

Bạc Liêu has 131,000ha of aquaculture, including more than 123,000ha of shrimp.

With a coastline of 56 kilometres, the province has brackish and fresh water areas suited for breeding aquatic species.

However, agriculture production still faces the impact of climate change, rising sea levels and disease outbreaks, according to the People’s Committee.

During a meeting with a working group from the Ministry of Agriculture and Rural Development (MARD) in Bạc Liêu on Wednesday (July 29), Vương Phương Nam, deputy chairman of the province’s People’s Committee, said that besides rice, aquaculture has conditions for sustainable development and contributes an important role in socio-economic development.

The province is planning to build a high-quality shrimp fry production centre and aims to become the country’s high-tech shrimp farming hub, according to Nam.

Hoàng Lưu Ly, director of the department, has petitioned MARD to invest in two ship lock combined sluices on the Cà Mau – Bạc Liêu Canal that would take water to breed shrimp south of National Highway No.1A in the dry season.

The province needed MARD’s support in research and transfer techniques for treating waste from shrimp farming under super-intensive, intensive and semi-intensive farming models to reduce pollution on a large scale, he said.

It has asked MARD for funds to invest in infrastructure for areas where the three farming models are being implemented and for an aquatic fry species production area south of National Highway No.1A.

Phùng Đức Tiến, Deputy Minister of MARD, praised the province for preventing disease in aquaculture and developing disease - free shrimp breeding establishments for exports.

He said the province should improve the management of aquatic fry species as well as food, medicine and bio-products used for aquaculture.

It should also raise public awareness among local residents about diseases and strictly punish violators of regulations, he said.

Long An farmers using high-tech production see higher incomes

The use of advanced technologies in Long An Province has improved profits for farmers, according to the province’s Department of Agriculture and Rural Development. 

For the last five years, the Cửu Long (Mekong) Delta province has applied high-tech methods to cultivate 2,082ha of dragon fruit, 15,075ha of rice, 1,476ha of vegetables and 4,000 cows for meat.

The products are produced under Vietnamese or Global Good Agricultural Practices (VietGAP or GlobalGAP) standards.

Phan Quốc Chinh, who has 1ha of dragon fruit under GlobalGAP standards in Châu Thành District, said he had invested in automatic drip and spray irrigation systems for his orchard. The systems use irrigation water and fertiliser effectively, he said.

Rice, dragon fruit, vegetables and cows are the province's key agriculture products. Shrimp is expected to be a key agriculture product for export in the future.

Many co-operatives and co-operative groups in the province are engaged in high – tech shrimp farming.

In Cần Giuộc District, for instance, five co-operatives and 42 co-operative groups are involved in the model. Each farmer spends an initial cost of VNĐ200 – 300 million (US$8,600 – 12,900) for equipment per 1,000 sq.m of shrimp ponds. The model saves labour costs, reduces the shrimp death rate and produces quality shrimp.

Farmers can harvest about 3 tonnes of shrimp per 1,000 sq.m pond after three months of breeding and earn a profit of VNĐ100 million ($4,300).

Nguyễn Thanh Điền in Cần Giuộc’s Phước Vĩnh Đông Commune said he harvested 5 – 7 tonnes per 2,000 sq.m from this high – tech shrimp pond. The profit was two to three times higher than traditional farming methods, he said.

The province plans to have more than 6,800ha of brackish shrimp this year, including 200ha using high-tech farming.  

Đinh Thị Phương Khanh, deputy director of the provincial Agriculture and Rural Development Department, said that brackish shrimp farming areas combined with high – tech shrimp farming would breed three to four shrimp crops a year.

This would increase yield and quality, protect the environment and develop sustainable production, she said.

To produce products of even quality and size and in large amounts, the province has created favourable conditions for agriculture co-operatives. The province helps them access advanced farming techniques and develop value chains for their products.

It has also promoted linkages among farmers and companies to produce and buy agricultural produce, especially high – tech products.

With the province’s support, the Tâm Nông Việt High - Tech Agriculture Co-operative in Cần Giuộc District has received an automatic irrigation system to grow honeydew melon in poly-greenhouses.

According to Đinh Bạt Quy, director of Tâm Nông Việt, the co-operative produces clean produce and has stable outlets. It also grows vegetables in poly-greenhouses.    

The Mười Hai Clean Vegetable Co-operative in Cần Đước District plants 40 kinds of VietGAP-quality vegetables on a total area of 163ha and sells to supermarkets in and outside the province.

Lê Văn Giấy, director of Mười Hai, said the co-operative planted vegetables in net houses and used drip and spray irrigation systems.

The co-operative invested in warehouses to preserve harvested vegetables according to the requirements of its purchasing partners, he said.

Vietnam holds huge potential for IT development: Indian expert

Vietnam holds tremendous potential for information technology (IT) development thanks to its young and talented human resources and attractive investment climate, thereby becoming one of the brightest investment destinations for Indian firms, an Indian expert has said.

Sanjay Gupta, Corporate Vice President at HCL Technologies, made the remark during a virtual seminar on Vietnam’s key macroeconomic policies to cope with the COVID-19 pandemic and potential sectors for long-term investors held by the Vietnamese Embassy in India on August 7.

The event drew the participation of about 100 businesses, investors, experts and scholars of the two countries.

At the event, Vietnamese delegates updated their Indian counterparts about the Vietnamese Government’s policies in the context of COVID-19 and potential sectors for investment, stressing that the country has become a bright spot in both economic recovery and fighting the pandemic.

With an open economy and favourable business climate, Vietnam boasts potential to become of the nations with the fastest economic growth in the world in the post-pandemic period.

Gupta also spoke highly of the Southeast Asian country’s incentives in IT development.

He noted that the number of Indian companies invested in Vietnam’s IT field, standing at only 23 so far, has yet to match with the potential of the sector and the cooperation potential between the two countries.

HCL Technologies is working on a major investment plan worth hundreds of millions of USD in Vietnam, he said, which may employ 8,000 people in the upcoming fiscal year especially in the software and service sectors.

The Indian company also eyes the establishment of one of its largest hubs in Southeast Asia in Vietnam, he added.

HCL Technologies, a multinational IT service and consulting company, is the third largest IT firm in India with 150,000 employees working in 47 countries and territories across the world.

Dozens of tonnes of Vietnamese longan enter Australia over past few weeks

Dozens of tonnes of Vietnamese longans have been exported to Australia and distributed in the states of South Australia and Western Australia over the past few weeks.

The most recent was the shipment of 7.5 tonnes of longans from the Mekong Delta provinces which arrived in Australia on August 6 and the 9-tonne batch departing from the northern province of Hai Duong on August 8 will join a promotional event, titled “Nhan Viet Nam minh” (Vietnamese longans), to be held by the Vietnam Trade Office in Australia.

Both batches were imported by 4 Ways Fresh – a Australia-based agribusiness founded in early 1993.

According to 4 Ways Fresh CEO Ly Hoang Duy, Vietnamese fresh longans have gained good impression and favours from local consumers. Vietnamese longans are sold at lower prices compared to those grown in Australia, Duy said, adding that though the longans are small, they have special flavours and very sweet.

Since the beginning of 2020, 4 Ways Fresh has imported about 30 tonnes of longans from Vietnam, mostly the Mekong Delta. After the shipment of 9 tonnes of longans from Hai Duong arrived in Australian, the company plans to raise the weekly import to 10 tonnes to meet increasing demand.

The event “Vietnamese longans” will last until the harvest season ends in Vietnam, according to head of the Vietnam Trade Office in Australia Nguyen Phu Hoa. It will include promotional activities on social networks, he added.

In 2019, longan has become the fourth Vietnamese fruit to gain permission to enter Australian market after lychee, mango and dragon fruit.

HCM City suggested to collect infrastructure fees at ports

Ho Chi Minh City’s Department of Transport has recommended that the People’s Committee should collect infrastructure fees at ports to fund improvements to their facilities.

The volume of cargo handled by them is growing at 5 percent a year, with the goods brought mainly by road, meaning the number of container trucks going in and out of the ports is huge.

On average, 26,000 vehicles come to the ports every day but the road network around them has not developed commensurately, resulting in prolonged congestion, according to the department.

The city has been investing large amounts of money every year in transport networks, infrastructure and public services at or near ports that serve foreign trade.

But funds are limited and so fees should be collected from users of public facilities, the department said.

According to figures from the Association of Vietnam Seaports, HCM City ports’ throughput in 2018 was 6 million TEUs and Hai Phong ports’ was 2 million TEUs.

But Hai Phong collects fees at its ports, with the northern city’s People’s Council saying they amounted to 1.29 trillion VND (56 million USD) in 2018.

Revenue from the fees could also be used to invest in infrastructure for business activities, which would help make HCM City a smart city and improve its logistics services, according to the department.

Vietnam, Japan foster cooperation in industry, trade, energy

The 4th meeting of the Vietnam-Japan Joint Committee on Cooperation in Industry, Trade and Energy was held in Hanoi on August 7 in the form of video conferencing.

Hanoi – The 4th meeting of the Vietnam-Japan Joint Committee on Cooperation in Industry, Trade and Energy was held in Hanoi on August 7 in the form of video conferencing.

The meeting was co-chaired by Vietnamese Minister of Industry and Trade Tran Tuan Anh and Japanese Minister of Economy, Trade and Industry Kajiyama Hiroshi.

The ministers rejoiced at cooperation outcomes between the two sides since the 3rd meeting, especially collaboration within the Association of Southeast Asian Nations (ASEAN), the Regional Comprehensive Economic Partnership (RCEP), and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), as well as cooperation in energy, automobile and chemical industries and industrial workforce training.

They reiterated the significance of the joint committee in removing difficulties for businesses and promoting cooperation between the two countries, particularly in the context of the COVID-19 pandemic.

They shared the view that Vietnam-Japan cooperation in trade, industry and energy should go with targets set in the ASEAN-Japan Economic Ministers’ Joint Statement on Initiatives on Economic Resilience in Response to the Coronavirus Disease, and the ASEAN-Japan Economic Resilience Action Plan.

Hiroshi lauded the leadership of Vietnam as ASEAN Chair 2020, and committed to further coordination with the country.

The two ministers highlighted persity, transparency, and sustainability in building a firm supply chain in the industrial sector.

Anh said the Vietnamese Government pledges to perfect the investment environment in the time ahead to facilitate the operation of foreign investors in general and those from Japan in particular.

He appreciated Japan’s technical assistance in personnel development in the industrial sector over the past years.

The minister expressed his delight at projects in Vietnam included in Japan’s initiative on personnel development in the sphere of auto control software in ASEAN, to be rolled out for the first time this year.

He suggested applying Japan’s KOSEN model in personnel development in training facilities of the Vietnamese Ministry of Industry and Trade in order to improve capacity and create more added values for a number of key industries in Vietnam like chemicals, garment-textile, auto and supporting industries.

Both ministers pledged to make efforts for a free, fair, transparent, stable and foreseeable trade and investment environment in Asia-Pacific.

They reiterated commitments to promoting economic integration in Asia-Pacific, and agreed to support each other and closely coordinate at multilateral economic and trade cooperation frameworks of which the two countries are members.

They also discussed other issues like digital transformation, the fourth Industrial Revolution and the free flow of data with trust.

In the field of energy, they said the Nghi Son oil refinery is significant to both sides, and suggested the Vietnamese and Japanese governments facilitate the implementation of the project.

It is necessary to persify energy resources, step up oil and gas cooperation and promote energy-related policies to meet the increasing demand for energy, they said.

The two countries will also foster collaboration in addressing global challenges like climate change, while mobilising financial resources, including private investment, for energy infrastructure projects and projects on free and competitive energy market development in Indo-Pacific through multilateral frameworks.

Meeting discusses amendments to decrees on SOE equitisation

Deputy Prime Minister Truong Hoa Binh chaired a meeting on August 10 to review draft decrees that amend and supplement a number of Government decrees on equitising State-owned enterprises (SOEs) and divesting State capital from businesses.

To clear legal barriers and speed up the equitisation and divestment processes, the Government and Prime Minister assigned the Ministry of Finance to draft decrees amending and supplementing Government Decrees No 126/2017/ND-CP, 91/2015/ND-CP, and 32/2018/ND-CP.

At the meeting, the Ministry of Finance proposed measures for land rearrangement and use during the SOE equitisation and discussed State capital divestment at enterprises with demand for increasing their capital.

It also suggested clarifying cultural and historical values in the initial price transfer of State capital, among other issues.

Binh directed the ministry to continue examining and adjusting the decrees to tackle obstacles related to financial mechanisms and policies.

Changes must be in line with the law on the management and use of public assets, he said, stressing that SOEs work with local authorities to set prices for public assets or return them to localities in line with the law, in the spirit of not letting assets on land go to waste.

Ninety-three SOEs must complete their equitisation by the end of this year under Decision No 26/2019/QD-TTg issued by Prime Minister Nguyen Xuan Phuc in August 2019. Thirty-eight are based in HCM City and 13 in Hanoi./.

 
 

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