VIETNAM'S BUSINESS NEWS HEADLINES AUGUST 27

Ho Chi Minh City continues to assert itself as economic spearhead

Ho Chi Minh City is expected to reach 10 out of 13 key targets despite difficulties and challenges both domestically and internationally. One outstanding result is that the proportion of the city’s economy in the national economy continues to rise and now accounts for more than 22%.

In the first seven months of this year, the export turnover of goods from Ho Chi Minh City enterprises stood at more than 24.7 billion USD, up 5.8% against the same period last year.

Despite such figure, the COVID-19 pandemic has hit the city hard. From averaging 8.27% growth each year in the 2016-2019 period, the figure for 2020 has been forecast at about 5%.

Though growth is down, the proportion of the local economy in the national economy continues to rise. In 2019 it accounted for more than 22% as compared to 17%  in 2000.

Accounting for nearly a quarter of national GDP is a remarkable effort. Along with substantial contributions from State and non-State economic sectors, the FDI sector has also seen steady growth.

The city has shifted notably towards attracting high-quality, high-tech, and high added-value FDI investment in recent years.

Ho Chi Minh City is calling for investment both at home and aboard to further develop and become a high-tech economy.

The city is making every effort to overcome the difficulties and actively respond to the need for economic recovery post-pandemic. It continues to focus efforts on remaining an economic spearhead that helps Vietnam fully recover.

Binh Dinh applies hi-tech in crop restructuring strategy

Binh Dinh province has gradually established groups of key agricultural products after six years of implementing a project on restructuring its agricultural sector towards increasing added value and ensuring sustainable development, in which the application of technology in production has been one of the top priorities.

The restructuring of farming and crop conversion on ineffective rice farming have been actively pursued in the province.

As soon as the winter-spring crop ended, Binh Dinh converted 4,300 ha of ineffective rice land to crops such as peanuts, corn, and peppers. The crop conversion has proven effective.

In the 2019-2020 winter-spring crop, farmers in Phù Cát district planted nearly 4,000 ha of peanuts, primarily in Cát Hiệp commune. Farmers have also applied technology such as automated irrigation systems to save water, which helps to cut costs and brings greater economic efficiency.

Binh Dinh is concentrating on applying hi-tech to agricultural development while improving the lives of local farmers, contributing to its socio-economic development.

Binh Dinh wants two large projects to seek FDI

The central province of Binh Dinh has proposed two large projects to be added to the list of those calling for foreign direct investment (FDI) in a recent report sent to the Ministry of Planning and Investment.

One is an automobile plant project with a capacity of 30,000-50,000 units per year, covering 50 hectares in Becamex – Binh Dinh Industrial, Urban and Service Complex. The project is expected to need an investment of 250 million USD.

Mitsubishi Motors Vietnam is looking for an appropriate destination for its second plant in Vietnam with an investment of about 250 million USD.

At a working session with Binh Dinh authorities in June, Mitsubishi Motors Vietnam’s general director Kenichi Horinouchi said the south-central coastal province was among the company’s top choices thanks to the developed transport and technical infrastructure system coupled with a huge clean land fund which was favourable for building automobile component plants.

Chairman of the provincial People’s Committee Ho Quoc Dung said he hopes Mitsubishi Motors would invest in the province, pledging favourable policies for foreign investors, especially the automobile plant.

Dung said the province is speeding up administrative reforms and improving the investment climate, which together with the availability of clean land will create favourable conditions for foreign investors.

The second project is a 300-bed hospital in Nhon Hoi Economic Zone which would cover an area of 3.5 hectares and have total investment of 15 million USD.

The previous list of projects seeking investment in Binh Dinh included four, of which a 24 million USD hospital and a 4 billion USD thermo-electricity centre are no longer seeking investment as they are no longer appropriate to the province’s development planning.

The other two projects, including Cat Nhon solid waste treatment project with an estimated investment of 75 million USD and a road upgrade project worth around 100 million USD, have found investors.

According to the provincial Economic Zone (EZ) Management Board, Nhon Hoi EZ and other industrial zones (IZs) in the province attracted 33 FDI projects as of February, worth 506 million USD in registered capital. Twelve countries and territories have invested in EZs and IZs in the province with China, Singapore and Japan being the largest investors.

The Ministry of Planning and Investment’s statistics showed Binh Dinh attracted more than 2.3 million USD worth of FDI in January-July, with two new projects and one existing project raising its registered capital./.

Ministry rejects demand for Can Tho Airport aviation logistics centre

The demand for air cargo transportation in the Cửu Long (Mekong) Delta through Cần Thơ remains low, meaning there is no need to develop the city’s airport into an aviation logistics hub, the Ministry of Transport has said in response to a demand by the People’s Committee.

The latter had proposed to the Government at a meeting last month that the Cần Thơ International Airport should be made an aviation logistics centre to transport passengers and cargo as well as train workforce for the aviation industry.

The freight traffic through the airport last year was only 9,059 tonnes as against 682,307 tonnes for HCM City and 695,325 for Hà Nội, according to the ministry.

Deputy Minister of Transport Nguyễn Nhật says in a statement that a large volume of freight is needed to consider developing an aviation logistics centre.

The ministry is drawing up a master plan for airports in the country in 2021-30 with surveys and proposals to develop aviation logistics centres, the statement says.

Cần Thơ International Airport will feature in the plan.  

Many 3-, 4-star hotels in HCM City on distress sale

Many hotels and motels in the bustling central districts of ​​HCM City are being sold off as the COVID-19 epidemic has caused their business to collapse.

During the first wave of the epidemic, when the country was under social distancing in April, there was some selling or long-term lease.

But since the end of July, when a second wave came, the lack of business and continuing pressure from bank loans are forcing many to sell out.

Many are unable to continue operations, experts said.

In Districts 1 and 3, boards announcing sales can be seen every dozen metres.

On Ly Tu Trong Street in District 1, many three- and four- star hotels are on offer at VND200-1,200 billion (US$8.66-52 million). A four-star property at the intersection with Chu Manh Trinh Street has 18 floors and 150 rooms, and the owner is looking to sell it for VND1.2 trillion, according to Tran Trung Hieu, its manager.

That price is 15 per cent lower than before the outbreak, but it is still hard to find a buyer.

A three-star hotel with 110 rooms near the Phu Dong intersection in District 1 is asking for VND 230 billion or VND 800 million a month if leased, 10 per cent and 20 per cent down from pre-pandemic days, according to Nguyen Trong Tien, its owner.

On nearby streets like Thu Khoa Huan, Le Thanh Ton and Bui Thi Xuan, many hotels are being offered for sale at VND250-400 billion. These are mostly mid-range hotels with more than 50 rooms targeted at middle-class and foreign tourists.

Several hotel chains have had to sell one or more properties to raise money to repay debts.

Prices are much lower than before the outbreak.

A four-star hotel with 80 rooms in HCM City that cost over VND 600 billion before the outbreak can now be bought for VND 400 billion.

Many guesthouses with 10-15 rooms on Bui Vien Street in District 1 are also available to buy or lease.

Nguyen Trong Hoang, the owner of a 11-room property, said: “I invested more than VND 3 billion ($130,000) over a year ago but now want to sell it for VND2 billion ($86,600) or rent it out at VND 35 million ($1,500) a month for five years.

“Before the epidemic the monthly profit was VND 70-90 million ($3,000-3,900).”

Five-star hotels are not doing any better as the number of foreign visitors coming to the city has dropped by 70-90 per cent since the pandemic began in March.

Many have to offer discounts of 70-80 per cent on room rents to attract guests, most of whom are experts coming to the city for work.

Thus, famous five-star hotels like Sofitel, Majestic, Nikko, Oakwood, New World, and Lotte have to rent their rooms at VND1.7-2.5 million ($74-107) per night.

According to surveys, the number of hotels on sale increased by 63 per cent in the second quarter.

Experts said more hotel owners could be selling out because the hospitality market has been down for too long and it would take at least a year to recover. 

Thailand’s July exports drop 11.3 percent

Thailand’s exports in July contracted 11.3 percent year on year to 18.81 billion USD, while its imports were valued at 15.47 billion USD, contracting 26.38 percent compared to the same period last year.

Local media quoted Pimchanok Vonkorpon, director-general of the Trade Policy and Strategy Office, as saying that during the first seven months of the year, the country’s exports reached 113.16 billion USD, down 7.72 percent year on year, while imports were 119.118 billion USD, down 14.69 percent, resulting in a 14.04 billion USD trade surplus.

One of the key factors for the positive trade outcome is the export potential of food, processed agricultural products and products for working from home while COVID-19 related goods are also in demand.

The Thai economy saw its strongest decline since the 1998 Asian financial crisis in the second quarter of 2020 when the COVID-19 pandemic affected the tourism industry and domestic manufacturing activities.

Earlier, the National Economic and Social Development Council of Thailand (NESDC) said that the country’s Gross Domestic Product (GDP) in the second quarter of 2020 decreased by 12.2 percent year on year, the sharpest fall since the 1998 crisis.

Garco 10 accesses foreign credit to make anti-COVID-19 products

Standard Chartered announced on August 24 that the Garment 10 Corporation JSC (Garco 10) has become the latest to benefit from its global financing commitment of 1 billion USD to help fight COVID-19.

The bank will provide the garment maker with a loan of up to 100 billion VND (4.3 million USD) to fund the production of medical and cloth face masks to help meet demand for personal protective equipment.

CEO of Standard Chartered Bank Vietnam Nirukt Sapru said the bank pledges to make unceasing efforts to help in the coronavirus fight, adding that the loan to Garco 10 reaffirms its commitment to supporting domestic businesses in this regard.

Garco 10 General Director Than Duc Viet said that given the unprecedented health challenges caused by the pandemic, high-quality personal protective equipment plays an important role in guarding people’s health and safety.

The company is helping to meet the urgent need around the world for personal protective gear, and the Standard Chartered loan will help with the production of cloth and medical face masks, he noted.

In March, Standard Chartered launched a financial package with preferential interest rates to support suppliers of key products and services in the COVID-19 battle, including producers and distributors of medicine and healthcare, along with non-healthcare companies that manufacture ventilators, face masks, protective equipment, disinfectants, and anti-pandemic consumer goods. Those in other sectors but planning to make products to help fight COVID-19 can also benefit from the package.

Cambodia-Thailand trade still growing despite pandemic

Trade between Cambodia and Thailand hit 82.02 billion THB (2.6 billion USD) in the first half of this year, up 2.27 percent year on year, the Phnom Penh Post reported.

Cambodia Chamber of Commerce Vice President Lim Heng noted the limited scope of cross-border trade restrictions between the two countries during the COVID-19 crisis, adding that the governments mainly restrict the movement of people in a bid to combat the spread of the novel coronavirus.

The total volume of trade between Cambodia and Thailand reached 9.41 billion USD last year, up 12 percent from 8.38 billion USD in 2018.

The majority of Cambodia’s exports to Thailand include gemstones, jewellery, agricultural products and aluminium. Cambodia’s imports from Thailand mainly consist of fuel, motorcycles, cars, gemstones and jewellery.

Meanwhile, Thailand’s two-way trade with its other neighbours plummeted in the first six months, according to data of the Thai Department of Foreign Trade.

Its total cross-border trade fell 9.18 percent in the January-June period on a yearly basis. The bilateral trade with Malaysia sank 26.81 percent, with Laos down 7.09 percent, and with Myanmar down 13.65 percent.

HCM City helping travel companies survive COVID-19

Some 90-95 percent of the travel companies in HCM City have suspended operations due to the COVID-19 pandemic, the municipal Department of Tourism reported on August 24.

The pandemic has forced companies to split their workforce into shifts working from home or to lay off employees until the outbreak is brought under control.

Occupancy in local accommodation is down 91.5 percent year-on-year, while the number of workers in the sector fell 61 percent. Businesses are forecast to face more difficulties in the time ahead.

Given this, the municipal Department of Tourism has mapped out two scenarios and specific measures to support these companies.

Under the first scenario, in which the disease is contained by September, the department will roll out a tourism promotion programme in the domestic market, linking travel companies, accommodation facilities, transport businesses, and tourist sites to introduce new and safe products, said Nguyen Thi Anh Hoa, deputy director of the department.

In the other, under which the pandemic lasts until the end of the year, the department will focus on workforce restructuring and training and helping businesses with market orientation and product building.

The department has also proposed the municipal People’s Committee continue with concrete solutions and create favourable conditions for travel companies to access the Government’s support packages, Hoa said.

Australian firms urged to explore opportunities in ASEAN

Australian Minister for Trade, Tourism, and Investment Simon Birmingham called on Australia’s business community to explore more opportunities in the ten ASEAN member states during a webinar held over the weekend.

The ASEAN-Australia: The Road to Recovery Interactive Webinar was jointly held by the Australia-ASEAN Council, the ASEAN Committee in Canberra, and Asialink, to celebrate the bloc’s 53rd founding anniversary.

Birmingham highlighted that growth potential in ASEAN countries, like Vietnam and Indonesia, coupled with established ties between Australia and nations such as Singapore and Malaysia, would provide major opportunities for Australian enterprises to further strengthen cooperation in trade and investment with ASEAN.

He noted that the Regional Comprehensive Economic Partnership (RCEP), to be inked by 15 countries across Indo-Asia-Pacific, will also facilitate business activities. He expects the deal will encourage Australia’s business community to seek opportunities in ASEAN nations, driving future growth.

CEO of Australia Post Christine Holgate, who is also chairman of the Australia-ASEAN Council, said she hopes that ASEAN would offer Australian companies opportunities to develop and participate further in the international strategic playground.

Mui Ne tourist site secures national status

The Ministry of Culture, Sports and Tourism has issued a decision recognising Mui Ne tourist site in the south-central province of Binh Thuan as a national tourist site.

Under a master plan approved by the Prime Minister, the Mui Ne national tourist site stretches from Hoa Phu commune in Tuy Phong district to Phu Hai commune in Phan Thiet city, covering a total area of about 14,760 ha.

Mui Ne is expected to play an important role in the tourism sector in the south-central coastal region and the country as a whole, and also become one of the leading destinations in Asia-Pacific by 2030.

Binh Thuan aims to welcome about 9 million tourists by 2025, including 1.5 million foreigners.

The total number of holiday-makers to the province is expected to reach about 14 million by 2030, with over 2.5 million international arrivals.

Tourism is expected to earn revenue of 24 trillion VND (over 1 billion USD) by 2025 and 50 trillion VND by 2030, generating about 24,000 jobs by 2025 and 45,000 by 2030.

Indonesia: Bali delays plans to welcome foreign arrivals in September

Plans to reopen Bali to international visitors on September 11 have been postponed following the Indonesian government’s decision to wait until the end of this year.

In a recent statement, Bali Governor Wayan Koster said that the government is still prohibiting its citizens from traveling abroad at least until the end of 2020, adding that in line with the policy, Bali cannot also open its gate to foreign tourists.

Koster added that the government fully supports the province's plans to reopen to international travelers as part of tourism recovery efforts, however Bali should be careful.

Following the decision, Bali is said to be focusing on efforts to attract domestic tourists in a bid to smooth its way to tourism and economic recovery.

The COVID-19 pandemic has badly hit Bali’s economy, 80 percent of which relies on tourism. The Bali's economy contracted 10.98 percent in the second quarter of 2020, and at least 2,667 labourers who work in the tourism sector have lost their job, and 73,631 people have been forced to take unpaid leave.

Previously, Bali was planning to reopen its tourism in three phases, starting on July 9 with the reopening of tourist sites to local residents, to be followed with reopening access to domestic travelers from regions across Indonesia. The third phase would have been to start welcoming foreign travelers on September 11.

Cambodia considers allowing more foreign workers

The Cambodian Ministry of Labour and Vocational Training will now allow foreign workers to make up more than 10 percent of certain enterprises’ staff if companies cannot find local workers to fill positions.

The announcement, signed by Labour Minister Ith Sam Heng in mid-August, said enterprise owners who fall under the scope of Article 1 of the labour law can file a request to employ an increased amount of foreign workers, the Phnom Penh Post reported.

Ministry spokesperson Heng Sour said the decision aims to meet the needs of full-time production chains which operate 24 hours per day, noting that the night entertainment, agriculture and construction sectors are still lacking workers.

According to this ministry’s regulation issued in 2014, enterprise owners or managers must prioritise recruiting Cambodian workers, and foreigners must not account for more than 10 percent of their staff.

However, Executive Director of the country’s Center for Alliance of Labour and Human Rights Moeun Tola said the ministry should not have made this decision because currently, Cambodian citizens returning from abroad are facing unemployment.

Allowing more than 10 percent of foreigners to work seems to open an opportunity to compete between foreign and Cambodian workers, he noted.

Vietnamese goods exhibition centre inaugurated in Thailand

The Vietnamese Goods Exhibition Centre at VT-Namnueng shopping mall was inaugurated at the Thai northeastern province of Udon Thani on Sunday.

Speaking at the ceremony, the Business Association of Thai - Viet Nam (BAOTV) Chairman Ho Van Lam said the centre will introduce and develop distribution channels for Vietnamese goods in Thailand, making them more popular in the country.

Vietnamese Consul General in Khon Kaen city Hoang Ngoc Son said the inauguration of the centre not only makes it easier for consumers in the northeast of Thailand to access high-quality Vietnamese goods but also helps the businesses in the two countries access trade and explore opportunities, towards a more balanced trade between the two nations.

He hoped the BAOTV will continue to open more similar centres in supermarkets and shopping malls, turning them into destinations for tourists.

Vice Governor of Udon Thani province Wanchai Janthorn spoke highly of contributions by the Thai community of Vietnamese descent and the Vietnamese Thai business people to Thailand’s socio-economic development.

The northeast of Thailand is now home to more than 70,000 Vietnamese Thai people. 

 

Professional liability insurance revenue surges

Professional liability insurance revenue, especially in the construction industry, surged strongly in the first half of this year, thanks to the rise in foreign direct investment (FDI) construction projects and strengthening inspections.

The Vietnam Insurance Association’s preliminary statistics showed by the end of June, compulsory liability insurance for construction investment consultants and construction workers jumped 791 and 848 per cent over the same period last year, respectively.

Professional liability insurance revenue in medical examination and treatment also increased by nearly 60 per cent against the same period last year.

According to representatives of the Post and Telecommunication Joint Stock Insurance Corporation (PTI), improved awareness of compliance with Circular No 329/2016/BTC on compulsory insurance in construction investment among construction contractors contributed significantly to the rise in revenue.

Though the circular took effect in 2016, firms have started buying professional liability insurance for their employees recently after authorities stepped up inspections.

In addition, a rise in the number of new FDI construction projects in the first six months of this year also contributed to the increase in sales of the professional liability insurance revenue.

Though there has been an improvement in the growth rate, compared to other insurance products, the proportion of professional liability insurance has remained very modest, at only 2 per cent of the insurance industry’s total revenue.

In Viet Nam, the potential for the growth of liability insurance and professional liability insurance is relatively significant. Currently, foreign insurance companies dominate the business segment and they also serve only foreigners in Viet Nam.

Some Vietnamese names provide the products including Bao Viet Insurance, Bao Minh Insurance, PTI, PVI or MIC, but their new premium is modest.

Industry insiders attribute the struggles of Vietnamese insurance companies in the business segment to their lack of experience.

In addition, the business segment isn’t attractive to Vietnamese insurance companies as cross-border insurance for foreign customers is allowed when the new Insurance Business Law comes into effect. 

Myanmar, Japan agree to reopen borders to each other’s citizens

Myanmar and Japan have agreed to reopen borders for expatriates and other long-term residents as soon as early September, relaxing travel restrictions that were imposed to stem the spread of COVID-19.

Myanmar State Counsellor Aung San Suu Kyi reached the agreement with Japanese Foreign Minister Toshimitsu Motegi at their meeting in Naypyidaw capital of the Southeast Asian nation on August 24.

The deal enables expatriates and other long-term residents to travel reciprocally provided they stay at home or at a designated place for 14 days after arriving and taking other measures to reduce the risk of infection.

Japan currently bans in principle entries by foreign nationals from 146 countries and regions. However, it has launched talks with 16 economies, including Myanmar, in recent months to resume travel in tandem with the restart of socio-economic activities.

Besides Myanmar, Japan has also reached similar deals with Singapore, Malaysia, Cambodia and Laos earlier this month.

Myanmar is the final leg of Motegi’s four-nation tour that included Papua New Guinea, Cambodia and Laos.

Footwear businesses adapt to COVID-19 pandemic

The leather and footwear industry is finding new supply and demand sources to overcome difficulties due to the impact of the COVID-19 pandemic.

Seventy percent of raw materials for domestic leather and footwear production are imported from China, according to Phan Thi Thanh Xuan, general secretary of the Vietnam Leather, Footwear and Handbag Association (Lefaso).

Therefore, the pandemic has caused difficulties for domestic leather and footwear enterprises.

Many businesses have sought material sources from other markets such as India, Europe, Singapore, and Japan to maintain production.

Along with the diversification of raw material sources, leather and footwear companies have been more active in finding partners.

Many businesses shared that some markets in Europe and Japan had shown signs of recovery with the disease better controlled.

The Vietnam - EU free trade agreement (EVFTA), which took effect from the beginning of this month, also helped leather and footwear businesses expand markets and get more orders, said Xuan.

The pandemic was still complicated, but if enterprises worked hard to find partners and improved their competitiveness, the opportunities would still be great, said experts.

Businesses and experts said that trade promotion activities, as well as support from management agencies, should be further promoted.

The Lefaso general secretary said the leather and footwear industry needed to overcome weaknesses in chain linkage.

She also recommended a separate decree for the leather, footwear, textile and garment industry to develop the fashion industry in the country.

The report on industrial production and trade activities in the first seven months of this year of the Ministry of Industry and Trade found the production of leather and related products increased by 7.6 percent last month compared to the previous month but was down 4.4 percent over the same period last year.

It decreased by 4.2 percent in the first seven months of the year compared to the same period last year.

Footwear export turnover of all kinds was estimated at US$9.53 billion in the seven months, a year-on-year drop of nearly 8 percent.

Imports of raw materials for the industry also reduced by 14.1 percent in the first six months.

Textile and garment exports set to continue declining

The Viet Nam Textile and Garment Group (Vinatex) forecasts Viet Nam's textile and garment exports will continue to decline by 14-18 per cent each month for the rest of 2020 over the same period last year.

The group also said the total textile and garment export value for this whole year is estimated to hit about US$32.75 billion, a year-on-year decrease of 16 per cent.

Vinatex general director Le Tien Truong said the textile and garment will face greater difficulties in the final half of the year than the first half.

“At present, there are almost no orders for member companies producing in the fourth quarter. That is a huge challenge for the group's business plan. Mask orders have reduced to low quantity while the price of this product has also decreased to the level that is the same rate with production cost," Truong told the Voice of Viet Nam (VOV).

According to the Viet Nam Textile and Apparel Association (VITAS), the second quarter was the most difficult quarter for the textile and garment industry because customers in major export markets such as the US and EU cancelled 30-70 per cent of orders because the markets were closed due to the COVID-19 pandemic.

Strong reductions in orders have caused higher inventories and increased pressure to pay workers, bringing more and more difficulties to textile and garment companies.

The Ministry of Industry and Trade also said as of July, many textile and garment enterprises had few orders for the last two quarters of this year, especially high-value products. Meanwhile, face masks and personal protective equipment, which are considered major products for many garment enterprises, have sharply decreased due to global oversupply.

The ministry said nobody knows when the pandemic will end so by this year-end, textile and garment enterprises need to pay attention to demand on the domestic market due to lower export orders. At the same time, they should manage production costs and maintain product quality to minimise the decline in revenue.

In addition, the businesses need to provide jobs and income for workers who have accompanied the enterprises during a difficult period.

At present, 80 per cent of enterprises in the textile and garment industry have cut their labour force while most businesses have slashed operation capacity by 50 per cent, the association said.

According to the Ministry of Industry and Trade, Viet Nam's export value of textiles and garments in July was estimated at $3.43 billion, up 14.4 per cent compared to June but down 11.8 per cent year-on-year.

In the first seven months of this year, the textile and garment export value was at $19.21 billion, down 13.8 per cent year-on-year.

Of which, fibre exports in the first seven months reached 876,000 tonnes, earning $1.89 billion. Exports plunged by 7.9 per cent in volume and 20.9 per cent in value over the same period of last year.

Garment export value during the first seven months was estimated at $16.18 billion, down 12.1 per cent year-on-year, accounting for 84.22 per cent of Viet Nam's total textile and garment export value. In July, export value rose by 15.3 per cent month-on-month to $3 billion though it reduced by 8.9 per cent year-on-year.

The ministry forecasts Viet Nam's textile and garment export value this year would reduce by 10-15 per cent to $33.6-36 billion compared to last year. This value is higher than the Vinatex forecast. 

Cambodia’s domestic tourism maintains growth

Cambodia’s tourism sector served over 1.4 million domestic tourists during the five-day holiday last week, which were offered in compensation for the Khmer New Year holiday postponed in April, reported the Cambodian Ministry of Tourism.

This is a positive sign for the tourism industry in the context of anti-pandemic measures.

The Khmer Times on August 24 quoted President of the Cambodia Association of Travel Agents Chhay Sivlin as saying that tourists felt more confident about the Government’s safety measures to contain COVID-19 while they also paid attention to health and safety.

It is estimated by tourism observers that Cambodia will lose around 3 billion USD in revenue from tourists because of the lack of international visitors and the sector would take up to seven years to recover.

The same day, the Cambodian Health Ministry announced that Cambodia reported no new COVID-19 cases for seven consecutive days. The tally remains at 273.

Quang Ninh a pioneer in smart tourism development

The northeastern province of Quang Ninh is one of the pioneers nationwide in implementing smart tourism solutions.

Smart tourism infrastructure has been improved throughout the province and is based on smart city development.

Simply put, smart tourism refers to the application of information and communications technology to ensure interaction between managers, businesses, and tourists.

Quang Ninh has favourable conditions to implement smart tourism, according to industry insiders, as it was ranked third in the Vietnam ICT Index in 2019.

Building integrated tourism data and a tourism portal has been defined as the first move and one of the top priorities in smart tourism for Quang Ninh.

Visitors are now able to access the local tourism information portal at halongtourism.com.vn and discoverhalong.com in Vietnamese, English, and Chinese, or through Quang Ninh tourism sector’s fanpage on Facebook, for the latest information.

These websites not only introduce popular destinations, entertainment, festivals, and specialty dishes but also include guidance for visitors to book rooms, cars, and tickets online, as well as hotlines to accept feedback on services.

They are expected to apply artificial intelligence in the future to help holidaymakers select and design their itinerary by themselves.

Quang Ninh also provides free wifi at airports, bus stations, and residential and tourism areas.

All vessels on Ha Long Bay - the province’s stand-out attraction - have had GPS installed to ensure tourist safety.

In April 2019, Uong Bi city launched its Dulichuongbi app for smartphones, which suggests popular destinations and provides detailed information on access, costs and estimated time to reach them.

Such apps are not only useful for travellers but also help businesses save on advertising costs and increase their links with customers and partners.

Quang Ninh is now focusing on its smart tourism administration centre, which is expected to be put into operation this year.

Smart tourism is expected to help Quang Ninh fully exploit its natural advantages for sea and island tourism. It has a coastline of more than 250 kilometres and more than 2,000 islands and islets which account for two-thirds of the total number in Vietnam.

In particular, Ha Long Bay literally “descending dragon bay”, was twice recognised as a World Natural Heritage site by UNESCO in 1994 and 2000. The bay spans 1,553 square kilometres and includes 1,969 islands of various sizes. It features thousands of limestone karsts and islets in various shapes and sizes. The limestone in the bay has gone through 500 million years of formation in different conditions and environments. The geo-diversity of the environment has created biodiversity, including a tropical evergreen biosystem, oceanic and sea biosystem.

In 2018, Ha Long Bay made it into the top 15 Instagrammed global cruise destinations based on a survey of 1.8 million posts tagged on various ships and ports by travel cruise site SeaHub.

In 2019, British travel magazine Rough Guides included Vietnam’s Ha Long Bay in its selection of the 100 most beautiful places to visit next year. It describes “the scattering of limestone pinnacles jutting out of the smooth waters of Ha Long Bay”, around four hours east of Hanoi capital, as an “incredible sight”.

Most recently in 2020, Ha Long Bay was named amongst the 50 most beautiful natural wonders on Earth selected by US-based magazine Insider.

Last year, Prime Minister Nguyen Xuan Phuc approved a master plan to develop Ha Long city into a world-class tourism and service hub by 2050. Under the plan, Ha Long will be converted into a civilised and friendly sea tourism city with synchronous and modern socio-economic infrastructure systems.

Canada aids Vietnam in boosting food safety

A food safety project funded by the Canadian Government will be deployed in Ho Chi Minh City, Hanoi and some other parts of the country by the Ministry of Agriculture and Rural Development from 2020 to 2025.

The project aimed at implementing regulations on standard food safety and calling on producers and households to move toward smart agricultural production and eco-friendly farming.

Deputy Minister Phung Duc Tien signed a decision approving the project called “Safe Food for Growth”, whose main owner is the National Agro-Forestry-Fisheries Quality Assurance Department. He said that a sustainable origin-tracing system would be created as a result of the project.

Apart from this, the project is expected to raise the awareness of customers over food safety, accelerate the consumption of agricultural products and stabilize the prices of farm produce in the country.

Through the project, management agencies will have the opportunity to access technology and advanced governance methods over food quality and safety and learn from research organizations, management agencies and producers in Canada.

The project requires a total investment of some 15.4 million Canadian dollars, with 15.3 million Canadian dollars, or US$10.9 million, coming from the Canadian Government’s non-refundable aid and the remaining 100,000 Canadian dollars from Vietnam’s reciprocal capital. 

COVID-19 casts shadow on business households

The second outbreak of COVID-19 has pushed many business households in Hanoi’s Old Quarter to the brink due to the total absence of international travellers, their main customers.

Hotels, restaurants, clothing stores and beauty salons in the Old Quarter mostly target international visitors. Their absence has pushed many of these businesses to the wall.

Small and micro-sized enterprises are in need of the Government’s assistance to survive these turbulent times, in particular a bailout package.

Textile-garment exports to continue declining

The Vietnam Textile and Garment Group (Vinatex) forecasts the country’s textile and garment exports will continue to decline by 14-18 percent each month for the rest of 2020 over the same period last year.

The group also said the total textile and garment export value for this whole year is estimated to hit about 32.75 billion USD, a year-on-year decrease of 16 percent.

Vinatex general director Le Tien Truong said the textile and garment will face greater difficulties in the final half of the year than the first half.

“At present, there are almost no orders for member companies producing in the fourth quarter. That is a huge challenge for the group's business plan. Mask orders have reduced to low quantity while the price of this product has also decreased to the level that is the same rate with production cost," Truong told the Voice of Vietnam (VOV).

According to the Vietnam Textile and Apparel Association (VITAS), the second quarter was the most difficult quarter for the textile and garment industry because customers in major export markets such as the US and EU cancelled 30-70 percent of orders because the markets were closed due to the COVID-19 pandemic.

Strong reductions in orders have caused higher inventories and increased pressure to pay workers, bringing more and more difficulties to textile and garment companies.

The Ministry of Industry and Trade also said as of July, many textile and garment enterprises had few orders for the last two quarters of this year, especially high-value products. Meanwhile, face masks and personal protective equipment, which are considered major products for many garment enterprises, have sharply decreased due to global oversupply.

The ministry said nobody knows when the pandemic will end so by this year-end, textile and garment enterprises need to pay attention to demand on the domestic market due to lower export orders. At the same time, they should manage production costs and maintain product quality to minimise the decline in revenue.

In addition, the businesses need to provide jobs and income for workers who have accompanied the enterprises during a difficult period.

At present, 80 percent of enterprises in the textile and garment industry have cut their labour force while most businesses have slashed operation capacity by 50 percent, the association said.

According to the Ministry of Industry and Trade, Vietnam’s export value of textiles and garments in July was estimated at 3.43 billion USD, up 14.4 percent compared to June but down 11.8 percent year-on-year.

In the first seven months of this year, the textile and garment export value was at 19.21 billion USD, down 13.8 percent year-on-year.

Of which, fibre exports in the first seven months reached 876,000 tonnes, earning 1.89 billion USD. Exports plunged by 7.9 percent in volume and 20.9 percent in value over the same period of last year.

Garment export value during the first seven months was estimated at 16.18 billion USD, down 12.1 percent year-on-year, accounting for 84.22 percent of Vietnam’s total textile and garment export value. In July, export value rose by 15.3 percent month-on-month to 3 billion USD though it dropped by 8.9 percent year-on-year.

The ministry forecasts Vietnam’s textile and garment export value this year would fall by 10-15 percent to 33.6-36 billion USD compared to last year. This value is higher than the Vinatex forecast.

Vinh Phuc looks to create green environment at industrial parks

Along with investing in building infrastructure and promoting production, businesses at industrial parks (IPs) in the northern province of Vinh Phuc are also focusing on sewage treatment and environmental protection to ensure the health and safety of workers.

In response to the green lifestyle movement, the Korean-invested firm Cammsys Vietnam Co., Ltd., which specialises in the production of electronic products, has invested in growing trees in and around its facility.

Dao Xuan Hao, director of the provincial investment support service centre, said that of 54 ha of land at section 2 of the Ba Thien IP, some 15 ha is green space.

Japan’s Sumitomo Corporation, meanwhile, is also focusing on growing trees at the Thang Long IP to create a green space and reduce environmental pollution.

The company has also invested in building three canals with a combined length of 3.6 km.

Some 309 out of 367 projects, or 84 percent, at IPs in Vinh Phuc province had been put into operation as of the end of July, up 6 percent against last December.

Of the 367 projects, 62 are domestic direct investment projects valued at over 14.8 trillion VND (633.6 million USD), while 305 are FDI projects worth more than 4 billion USD.

Binh Xuyen district alone has seven IPs covering nearly 2,000 ha: Thang Long Vinh Phuc, Binh Xuyen, Binh Xuyen II, Ba Thien, Ba Thien II, Son Loi, and Nam Binh Xuyen, leading the province in numbers and investment projects.

The Thang Long Vinh Phuc IP has attracted dozens of investors from Japan, with combined capital exceeding 200 million USD, even though it has only just finished the first phase of construction.

Between 2016 and 2019, Vinh Phuc attracted 2.5 billion USD in foreign direct investment (FDI) and some 55.28 trillion VND (2.38 billion USD) in domestic direct investment (DDI).

By the end of June 2020, Vinh Phuc was home to 392 FDI projects with total registered capital of 5.57 billion USD, according to statistics of the provincial Department of Planning and Investment.
The projects were run by investors from 18 countries and territories. The Republic of Korea has the most projects with 210, followed by Japan, China and Thailand.

Many global groups have made their presence in Vinh Phuc, such as Toyota, Honda, Sumitomo from Japan, Piaggio from Italy, De Heus from the Netherlands, Daewoo, Haesung Vina, Partron Vina, Cammsys from the Republic of Korea, Prime Group from Thailand and Weldex from the US.

The province has also attracted 782 DDI with total investment surpassing 93.7 trillion VND (around 4 billion USD at current exchange rate). Several major Vietnamese corporations have chosen Vinh Phuc for their investment, such as FLC, Vingroup, SunGroup, and Viet Duc Steel.
The flow of investment capital, both FDI and DDI, into the province in the first six months of this year decreased as a consequence of the coronavirus pandemic. Total FDI capital in the period stood at 135.6 million USD, equivalent to only 32.1 percent of the figure in the same period last year. The money was poured into 14 new projects and 19 existing ones.

Vinh Phuc has designated 18 industrial parks with total area of 5,228 ha in a master plan to 2020 approved by the Prime Minister. By now nine industrial parks have received investment certificates. Industrial parks in Vinh Phuc have good technical infrastructure and professional management, thus contributing to attracting investors to the province. They reported an average occupancy rate of nearly 62 percent./.

 
 

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