VIETNAM'S BUSINESS NEWS HEADLINES AUGUST 4

Retailers increase stocks to ensure supply in all circumstances

VIETNAM'S BUSINESS NEWS HEADLINES AUGUST 4
Customers shop at Co.opmart Da Nang. Retailers have ensured an adequate supply of goods and enhanced safeguard measures to protect the health of their staff and shoppers. — Photo courtesy of Saigon Co.op


 
 
 
Retailers have prepared goods to ensure adequate supply in all circumstances and have continued measures to safeguard the health of customers and staff amid new cases of COVID-19 that have occurred via community transmission.

Saigon Co.op has increased stock for essential goods and taken stricter measures against COVID-19 at its supermarkets and retail stores nationwide, including Co.opmart, Co.opXtra, Co.op Food, and Co.opSmile.

Do Quoc Huy, Saigon Co.op’ s marketing director, said with experience gained from the peak COVID-19 period, its retail systems have a clear roadmap for stockpiling as well as measures to cope with new developments.

An adequate supply of essential goods have been ensured as well as antibacterial cloth masks, medical masks and hand gel sanitisers, he said, adding that Saigon Co.op’ s human resources and transportation plans have been carefully mapped out to cope with any circumstances related to the COVID-19 pandemic.

Fresh food, fruits and vegetables and face masks are among the best-selling products at Co.opmart's entire system. In addition, sales of instant noodles, frozen foods and sanitary products have increased slightly compared to the previous week, he said.

At Co.opmart Da Nang in Da Nang City, which has resumed strict social distancing measures to contain the spread of COVID-19, sales of these products have risen by 25 per cent compared to a week ago.

A representative of Big C & GO! said the supermarket has been supplying sufficient goods at stable prices to customers, and has worked with delivery service providers to serve customers who order goods via its hotline 19001880.

Retailers are transporting goods under separate plans to different localities, especially to Da Nang, Quang Nam and Hue, and adopting measures to ensure social distancing rules at its stores in Da Nang.

Modern distribution channels are supplying a large number of medical masks, antibacterial cloth masks and quality hand sanitisers. Retailers are also applying promotions on essential goods.

At traditional markets in HCM City, supplies are abundant and prices have been stable.

Vietinbank posted US$319.6 million before-tax profit

Vietinbank, listed as CTG, posted pre-tax profit of more than VND7.4 trillion (US$319.6 million) in the first half of the year, representing a 40 per cent year-on-year increase.

Vietinbank has announced its financial report, saying that in the context of weak growth in net interest income due to the reduction of lending interest rates to support customers, its non-credit business segment showed positive growth results.

In the first six months of 2020, the bank’s net interest income only increased by 0.2 per cent over the same period to VND16.2 trillion.

In return, the bank shifted its income structure, boosting non-credit income to bring positive results. Profit from service activities in the period increased by 10.5 per cent over the same period, reaching VND2.16 trillion. Profit from foreign exchange trading increased by 31.7 per cent to VND1 trillion.

Earnings from securities trading increased by 185 per cent to VND389 billion. Other operating profit also increased strongly by 36 per cent to VND470 billion.

In the first half of the year, interest from non-credit activities contributed 21.5 per cent to the bank's total operating income, up from 17.3 per cent in the same period of 2019.

Similar to many other banks, VietinBank began tightening operating expenses, down 3.8 per cent in the period, to VND6.6 trillion.

Risk provision expense decreased by 10.6 per cent to VND6.6 trillion.

As of June 30, VietinBank's loan balance is VND941.4 trillion, up by 0.7 per cent from the same period last year. Its total assets reached nearly VND1.24 quadrillion, down slightly by 0.1 per cent compared to the beginning of the year. Customer deposits increased by 2.3 per cent to VND913.3 trillion.

VietinBank's bad debt on June 30 was VND15.9 trillion, accounting for 1.7 per cent of total loans.

In the first six months, the bank bought over VND6 trillion of bad debts at Viet Nam Asset Management Company (VAMC), bringing the total value of debt purchased to date (after about 1.5 years) to nearly VND6.8 trillion. VietinBank also made a risk provision of about 50 per cent of the debt value, speeding up the restructuring plan associated with handling bad debts in the period of 2016-20.

Vinamilk records $670 million in April-June revenue

The Vietnam Dairy Products JSC (Vinamilk) recorded over VND15.49 trillion (US$670.16 million) in consolidated net revenue between April and June, up 9.5 per cent from the first quarter and 6.1 per cent from a year earlier.

In its financial report for Q2, Vinamilk, one of the largest dairy product manufacturers in Viet Nam, said the revenue included more than VND13.36 trillion generated by domestic business activities, up 10.5 per cent quarter on quarter and 7.6 per cent year on year.

It attributed the growth to the inclusion of business outcomes of the GTNFoods JSC and the Moc Chau Dairy Cattle Breeding JSC, where it is the largest shareholder, since Q1.

Meanwhile, the parent company’s net revenue was over VND13.62 trillion, rising 13.6 per cent from Q1 and 4 per cent from the same period last year.

The lifting of social distancing on April 22 has also supported the firm’s performance in Q2, it said.

Despite the impact of the COVID-19 pandemic on domestic and global economies, Vinamilk has still taken actions to seek opportunities in potential markets, it noted, adding that the export of dairy products to China, the Republic of Korea and some other markets contributed VND1.37 trillion to net revenue in Q2, up 26.8 per cent quarter on quarter and 7.1 per cent year on year.

Its overseas branches post VND761 billion in net revenue, accounting for 5 per cent of the consolidated net revenue in Q2.

The post-tax consolidated profit in the April-June period reached VND3.08 trillion, increasing 6.2 per cent from a year earlier, the company noted.

In June, Vinamilk became the first milk company of Viet Nam to be licensed to ship dairy products to member countries of the Eurasian Economic Union (EAEU). 

ABBANK shrugs off pandemic effects, hits first half profit target

ABBANK has achieved its target for the first half with pre-tax profits of VND628 billion (US$27.1 million).

Deposits increased by 10 per cent year-on-year to VND71.3 trillion ($3.07 billion), and total outstanding loans rose 16.7 per cent to VND63.01 trillion ($2.7 billion).

Its non-performing loans ratio was 2.13 per cent, a 0.41 percentage point increase since the end of 2019.

Return on equity (RoE) and return on assets (RoA) were at 15.7 per cent and 1.3 per cent, respectively.

Le Hai, acting CEO of the lender, said ABBANK’s performance in the first two quarters of the year was steady despite the difficulties posed by the Covid-19 pandemic.

“ABBANK is determined to … fulfil its business targets in the last six months of the year when the market is still facing many difficulties.

“We attach special importance to risk control to both optimise business performance and ensure safe, steady and sustainable development.” 

Some 13,200 firms established in July

Nearly 13,200 enterprises were established in July, down by 3.8 per cent compared to the previous month.

However, the registered capital of the new firms in the market last month increased by 72 per cent, showing the benefits of business support policies and efforts to revive the economy from the impacts of the COVID-19 pandemic.

The General Statistics Office (GSO) on Wednesday said the country’s newly established enterprises had registered capital of more than VND239 trillion (US$10.3 billion) and more than 91,000 employees, down 3.8 per cent in the number of businesses and up 72 per cent in registered capital.

The average registered capital of a newly established enterprise last month hit VND18.1 billion, a sharp increase of 78.8 per cent from the previous month and an increase of 60.9 per cent over the same period in 2019.

Also in July, the country had 4,839 enterprises resuming operations, up 79.9 per cent over the same period last year.

However, 3,400 enterprises registered to suspend their business. More than 3,000 firms stopped operations and are awaiting dissolution procedures and 1,504 enterprises completed dissolution procedures.

In the first seven months of this year, the country had more than 75,200 newly registered enterprises, a 5 per cent decrease compared to the same period last year. Notably, there were more than 28,500 enterprises resuming operations, an increase of 18 per cent.

The number of enterprises that suspended operations decreased by 12 per cent, while 3.5 per cent fewer enterprises completed dissolution procedures. The businesses were mainly in the fields of wholesale, retail, repair of cars and motorcycles, manufacturing and processing industry, construction, real estate, accommodation and food services.

On average, there were 14,800 new businesses established and re-operated every month.

The GSO said COVID-19's spread across the world had continued to harm Viet Nam's import and export activities. Total import-export turnover in January-July was estimated at US$285 billion, down 1.3 per cent over the corresponding period last year. Of which, exports reached $145.7 billion, up slightly by 0.2 per cent while imports were $139.3 billion, down 2.9 per cent. The country reported a trade surplus of $6.5 billion in the period. 

Tra fish exports to UK rise despite COVID-19 pandemic

The total export value of Vietnamese tra fish to the UK in the first half of 2020 rose 7.3% compared to the same period last year despite the impacts of the COVID-19 pandemic.

This is the best growth Vietnam has achieved in one of its10 largest export markets in the first six months of 2020.

According to the Vietnam Association of Seafood Exporters and Producers (VASEP), Vietnam exported US$31.7 million worth of tra fish to the UK market in the first six months of this year, accounting for 4.7% of Vietnam’s total tra fish export revenue to nearly 130 markets.

In June alone, the export revenue of tra fish to the UK market reached US$5.7 million, an increase of 15.2% over the corresponding period in 2019.

According to the International Trade Centre (ITC), the UK market imported 91% of its tra fish volume and 90% of its tra fish value from Vietnam in the first half of this year. Besides Vietnam, the UK also imports tra fish products from Germany, Indonesia, the Netherlands and Thailand.

Vietnam’s tra fish exports to the UK are expected to grow by 10% in 2020 if the optimistic export revenues continueto be maintained in the remaining months of the year. 

Inflation expected to be under control

Despite the six-year high for the consumer price index in the first seven months, Vietnam is expected to be able to bring the inflation under control this year due to weak demand for production and consumption, in addition to decreased demand in the global markets.

According to the National Centre for Socio-Economic Information and Forecast (NCIF), though the seven-month consumer price index (CPI) ascended 4.07% year-on-year, the highest increase in the first seven months within the 2015-2020 period, the government may be able to rein in inflation at below 4% as planned by the National Assembly.

“The domestic economy’s production remains feeble, with enterprises finding it hard to revive production and business, meaning that demand for goods and services is still feeble,” an expert from the NCIF told Nhan Dan Online. “Over the past seven months, the number of enterprises leaving the market has still been big.”

The General Statistics Office has reported that in the first seven months of the year, the number of enterprises halting their operations hit 32,700, up 41.5% year-on-year, while 26,700 enterprises were not operating at their registered addresses, up 26.8% year-on-year.

Moreover, about 2.13 million passengers and 957.6 million tonnes of goods were transported, down 26.7 and 7.3% year-on-year, respectively.

For example, Singapore-invested Indo Trans Logistics Corporation has suffered from significant decline of 40% in its goods transportation.

“Demand for transportation has reduced dramatically,” said a representative from the company which has 200 tractor trailers and 110 trucks. “What’s more, demands for goods from global markets in general have strongly declined, driving the logistics market into big difficulties.”

In another case, Nguyen Huu Xuan, worker from Japanese-invested FSC Vietnam based in Hanoi’s Thang Long Industrial Park, told Nhan Dan Online that like hundreds of other employees at the company, he has resumed normal work since late May. “However, we are paid only 70% of the salary as the company has not fully recovered its operations and has been unable to boost exports to Japan and Europe,” Xuan said.

The company churns out automotive and motorcycles’ components locally consumed and exported to Japan, the EU, and the US. Since early this year, its revenue has declined by 40% year-on-year.

The Japan External Trade Organization in Vietnam has just released a fresh survey on nearly 2,000 Japanese firms in Vietnam about their performance in the country. The results showed that 65% of the respondents suffered from reduced revenue in the first six months and expect the reduction to continue from now till the year’s end. About 96% of the surveyed businesses said COVID-19 has affected them badly, and 90% said they have been hurt by limited immigration and flights into Vietnam.

According to the NCIF expert, since early this year, people have had to tighten their belt, meaning their demand for goods is weak. Furthermore, the tourism sector has also suffered from significant dents.

Specifically, the revenue from tourists is estimated to be VND11.1 trillion (US$482.6 million), down 55.4% from the same period last year.

Many localities, which are Vietnam’s key tourist destinations, suffered from slashed revenue, such as Khanh Hoa (76.4%), Ho Chi Minh City (74.9%), Ba Ria-Vung Tau (63.3%), Da Nang (58.6%), Can Tho (57.1%), Quang Ninh (50.5%), Quang Binh (48.6%), Hanoi (38.6%), Thanh Hoa (38.5%), Binh Dinh (38%), and Hai Phong (23.7%).

“Thus, given the escalating COVID-19 situation worldwide, and slack demand in the local market, it is expected that the inflation rate in Vietnam this year will be about 4%,” Anh stressed.

A number of international organisations have also forecast that inflation in Vietnam will remain below 4% this year.

For example, according to the World Bank’s latest Taking Stock report, titled “What will be the new normal for Vietnam? The economic impact of COVID-19”, the World Bank stated that most financial variables will remain under control in 2020, especially the inflation rate, which is expected to remain under 4% during the 2020–2022 period.

“The State Bank of Vietnam should adjust monetary expansion to the expected growth rate of the economy to contain potential pressure on domestic prices over time. Food and energy prices – two important items in the consumer price index – should not see large increases in the absence of disruption in their supply chains or deterioration in climatic conditions,” stated the report.

Global data analysts and provider FocusEconomics told VIR in a statement that month-on-month inflation increased from 2.4% in May to 3.39 in July due to a marked rebound in foodstuff prices. “Inflation should stay under-control going forward, amid continued mild oil prices and a stable currency. Our panelists project that inflation will average 3.0% in 2020, down 0.4 percentage points from last month’s forecast, and 3.1% in 2021.”

The International Monetary Fund recently projected that Vietnam’s inflation rate this year will increase 3.2% year-on-year.

While Vietnam’s economy has been seriously impacted by COVID-19, it remains resilient and is poised to bounce back, according to a new World Bank report.

Also according to the World Bank’s report, although the Vietnamese economy suffered from COVID-19 in the first half of 2020, prospects remain positive for both the short and medium term. If the world situation gradually improves, economic activity should rebound in the second semester of 2020 such that the economy will grow by around 2.8 percent for the entire year, and by 6.8 percent in 2021. With less favourable external conditions, the economy will expand by only 1.5% in 2020 and 4.5% in 2021.

HCM City draws 2.37 billion USD in FDI in seven months

Foreign investment in Ho Chi Minh City has totalled 2.37 billion USD this year, including new and additional capital and share purchases, down 32.9 percent year-on-year.

There were 598 new projects with registered capital of 355.9 million USD, down 11.8 percent in volume and 48.3 percent in value. Some 113 projects added capital of 209.2 million USD.

More than 2,400 purchases of shares were made by foreign investors, worth more than 1.81 billion USD, down 27.8 percent year-on-year.

The trade sector led in terms of registered capital in the first seven months, with 624.1 million USD, accounting for 26.2 percent of the total. It was followed by real estate, with 441.6 million USD, or 18.6 percent, manufacturing and processing 315.6 million USD, or 13.3 percent, information and communications 149.4 million USD, or 6.3 percent, and construction 113.1 million USD, or 4.8 percent.

Investors from 104 countries and territories have registered new projects, added capital, or purchased shares this year. Singapore led the way, with 570.1 million USD, or 24 percent of the total, then the Republic of Korea with 357.9 million USD, or 15.1 percent, Japan 331.1 million USD, or 13.9 percent, the Cayman Islands 261.9 million USD, or 11 percent, the British Virgin Islands 137.6 million USD, or 5.8 percent, and the Netherlands 118 million USD, or 5 percent.

In order to become a popular destination among foreign investors post-pandemic, Director of the municipal Department of Planning and Investment Le Thi Huynh Mai said the city will focus on upgrading infrastructure, allocating capital to key transportation projects, and stepping up the progress of construction works.

It will also accelerate administrative reform and the building of several industrial parks (IPs), including a hi-tech IP on 380 ha in Binh Chanh district.

According to Savills Vietnam’s June global survey, Vietnam still leads in attracting global corporations thanks to its low costs and modern manufacturing facilities./.

Portal helps Mekong Delta firms get insights into EVFTA

The Vietnam Chamber of Commerce and Industry (VCCI) chapter in the Mekong Delta City of Can Tho (VCCI Can Tho) on July 31 launched a portal which will provide information and advice related to the European Union – Vietnam Free Trade Agreement (EVFTA) to businesses in the Mekong Delta region.

The portal at https://www.vccimekong.com/vi/cac-cau-hoi-thuong-gap is hoped to support regional business in a quick, convenient, in-depth and efficient manner.

Nguyen Phuong Lam, Director of VCCI Can Tho, said this is a new and convenient way to consult and answer EVFTA-related questions, as well as to help enterprises work online with experts if necessary, thus understanding more about the agreement.

The portal will also provide and update information on relevant policies and laws, contributing to helping regional businesses fully tap opportunities brought about by the trade pact and improve their competitiveness.

According to the Import-Export Department under the Ministry of Industry and Trade, the EU is one of the three largest export markets of Vietnam besides the US and China. Last year, Vietnam's exports to the EU market hit 41.54 billion USD, accounting for 15.7 percent of Vietnam's total export turnover.

Vietnam - EU bilateral trade increased nearly 13.8 times in the 2000 – 2019 period. Notably, Vietnam's exports to the EU rose nearly 15 times to 41.54 billion USD from only 2.8 billion USD.

When the EVFTA comes into effect, many Vietnamese goods will benefit from tariff policies, including key products of the Mekong Delta such as Tra fish, shrimp and fruits.

According to VCCI Can Tho, the approval of the EVFTA is expected to help Vietnam's export turnover to EU member countries surge by 45 percent by 2030, contributing to lifting the national GDP growth to 7 percent in the 2029-2030 period.

RoK to provide 5.15 million USD for six developing nations

The Korean Ministry of Economy and Finance announced on July 31 that it will provide 5.15 million USD for six developing nations, including Vietnam, to support projects ranging from establishing green growth and digital infrastructure to an improved COVID-19 response.

The aid will be provided through the Korea-World Bank Partnership Facility (KWPF) and Korea-IFC Partnership Programme (KIPP).

Through the KWPF, the Korean Government will help Uganda boost its agricultural productivity by providing advice on innovative agricultural technology. It will assist Kyrgyzstan with digital projects such as building educational infrastructure to boost the country's digital capacity.

Through the KIPP, the Republic of Korea (RoK) will help Vietnam and Cambodia boost efficiency in their manufacturing and agricultural sectors by providing advice on eco-friendly technologies. It also plans to assist Colombia in strengthening its COVID-19 response by applying quarantine-related digital solutions, and support Haiti in transitioning its textile industry to manufacture personal protective equipment.

The RoK hopes that these projects will bolster international cooperation and contribute to the RoK's playing a leading role in the official development assistance (ODA) sector as it relates to the environment, smart cities and ICT.

Vietnamese green mango exports to Australia double in H1

Figures released by the Australian Department of Agriculture revealed that Vietnamese green mango exports to Australia doubled year-on-year in the first six months of this year.

During the period, a total 124 tonnes of Vietnamese green mangoes were imported into Australia, an increase of 51 tonnes against the same period last year.

 

According to a report by ABC Rural, the competition from Vietnamese mangoes has made the price in Southern Territories drop around 40 percent, from about 80 AUD (63 USD) per tray last year to 50 AUD (35 USD) per tray this year.

Most of the exported green mangoes were being sold to restaurants, not supermarkets, where they were used in Southeast Asian cuisine.

Since July 20, Vietnamese durian has been jointly promoted in Australia by Vietnamese Commercial Affairs Office in Australia and the New South Wales-based ASEAN company. The firm has imported seven tonnes of frozen durian from the Southeast Asian country.

Frozen durian products which are mainly imported from Asian countries such as Thailand, Malaysia, China, and Vietnam, are increasingly finding favour among Australian consumers.

Mekong Delta province embraces rooftop solar

Rooftop solar energy is becoming increasingly popular in Tien Giang, with hundreds of companies, government agencies and private houses in the Mekong Delta installing solar panels.

In its My Tho city, 310 households have installed rooftop solar panels.

Many of them have even linked up their solar power systems with the grid and sell excess electricity to the Electricity of Vietnam (EVN).

The Government’s Decision No 13 on the support mechanism for the development of solar energy offers incentives to organisations and households to invest in rooftop solar.

Tien Giang authorities have supported the adoption of advanced technologies in agriculture to improve productivity and grow making clean produce.

Farmers use rooftop solar energy for lighting and watering their dragon fruit orchards, thus reducing their electricity bills.

Solar energy has also helped them reduce costs in animal husbandry.

Nguyen Thanh Hung of Cho Gao town said he has benefited from swallow net boxes and a solar energy system installed on his roof.

He said he spent around 2 billion VND (nearly 100,000 USD) on the rooftop system and generates 42-45 million VND worth of electricity per month from it.

According to EVN, the proliferation of rooftop solar systems has helped it meet the rising demand for power for domestic and commercial use.

Thai Vietjet inaugurates Bangkok - Khon Kaen flight

Thai Vietjet, a subsidiary of Vietnamese budget airline Vietjet Air, has inaugurated its maiden flight VZ210 from Thailand’s capital airport of Suvarnabhumi to Khon Kaen, the commercial and political centre in northeastern Thailand.

Celebrating the new service, Thai Vietjet brought all passengers onboard a memorable surprise by introducing a 'Ying Lee' concert in the sky with full team of dancers and cabin crew, along with nice corporate souvenirs.

Besides, the airline has launched a mega promotion from just 5 THB for one-way ticket (approx. 16 US cents) for booking throughout the five golden days from August 1 – 5, 2020 at website www.vietjetair.com or Vietjet Air mobile app. The special promotion tickets are applied for all Thailand domestic flights of Thai Vietjet travelling during August 1 – September 30 this year.

Aiming to facilitate domestic travel in Thailand, Thai Vietjet has constantly increased its flight frequency and destinations from Bangkok Suvarnabhumi Airport.

Currently, the carrier serves eight flights a day to Phuket/Chiang Mai, three flights a day to Chiang Rai, two flights a day to Udon Thani/ Krabi/ Hat Yai/ Khon Kaen in which the flight frequency for Suvarnabhumi - Hat Yai service will be increased to three flights a day from August 15, 2020. The airline will also inaugurate the Suvarnabhumi-Nakhon Si Thammarat flight on August 6, 2020.

It has also introduced on-line check-in service for domestic passengers travelling out of Suvarnabhumi airport for more convenience.

The new route Bangkok- Khon Kaen marks the airline’s 7th route from its Suvarnabhumi hub and is operated two daily flights, with flight duration of around 1 hour 5 minutes per leg.

Experts: EVFTA looks towards sustainable development

The European Union – Vietnam Free Trade Agreement (EVFTA) not only promotes trade and investment growth between Vietnam and the EU but also creates a driving force to boost cooperation in improving growth quality, towards sustainable development, experts said.

During an online forum co-hosted by the Vietnamese Ministry of Industry and Trade and the European Chamber of Commerce in Vietnam in Ho Chi Minh City on July 31, Deputy Minister of Industry and Trade Hoang Quoc Vuong said since the establishment of diplomatic ties in 1990, economic-trade-investment ties between Vietnam and the EU have been growing. Two-way trade rose 13-fold to 56.45 billion USD last year from nearly 4.1 billion USD in 2000.

Of the figure, Vietnam’s exports to the EU neared 41.5 billion USD while imports surpassed 14.9 billion USD. As of May, 26 out of 27 EU member states invested in 2,040 projects worth 21.66 billion USD in Vietnam.

With the EVFTA enforcement on August 1, Vuong said commitments in the deal will further expand export markets, especially for goods of strength such as tropical fruits, aquatic products, footwear, apparel and wooden furniture from Vietnam and the EU’s automobiles, pharmaceuticals and chemicals.

Vietnamese Commercial Counsellor in Sweden Nguyen Hoang Thuy said the potential of Vietnam’s growth of export to the EU remains huge. Vietnam’s shipments to seven Western European nations reached 29 billion USD while its exports to the remaining 20 countries only hit 6 billion USD.

EuroCham Vice Chairman Jean Jacques Bouflet said the EVFTA reflects the EU’s expectation on promoting comprehensive trade and investment with Vietnam. Accordingly, the EU enterprises will have a chance to access one of the most vibrant consumption markets in ASEAN and Asia and compete on equal terms with countries signing FTA with Vietnam like Japan and the Republic of Korea.

Vice Ambassador and Commercial Counsellor of Germany in Vietnam Weert Borner said the EVFTA also creates a driving force for Vietnam to apply labour and environment standards, promote the effective and economical use of land and water resources, thus meeting demand for sustainable development.

General Director of Bosch Vietnam Company Guru Mallikarjuna said the EU enterprises expect that the deal will help Vietnam fuel institution reform, create a more transparent business environment, continue improving workforce quality, step up digitalisation of information and management process, and issue a special mechanism to encourage investment in hi-tech and supply chain development.

Disbursement of public investment increases in July

The disbursement of public investment sourced from the State budget in July increased to its highest rate in the past four years.

The money came as Vietnam hurried up public investment disbursement as one of major drivers to get the economy back on its feet after the COVID-19 pandemic.

Latest updates from the finance ministry showed that the State budget sourced public investment disbursement was estimated at total 45.7 trillion VND (1.97 billion USD) in July, representing a rise of 51.8 percent against the same period last year.

This year the disbursement of public investment totalled 203 trillion VND, equivalent to 42.7 percent of the plan for the full year and up by 27.2 percent over the same period in 2019.

Ministries with good growth in disbursing public investment were the Ministry of Transport, 8.34 trillion VND, equivalent to 41.6 percent of the plan for the full year and up 91.7 percent against the same period last year. The Ministry of Health disbursed a sum worth 2.3 trillion VND, 34.7 percent of the target and up 36.1 percent while the Ministry of Agriculture and Rural Development saw 1.76 trillion VND in disbursed capital, 39.6 percent and 34.1 percent, respectively.

Hanoi saw disbursed investment capital worth more than 22 trillion VND, or 48.6 percent of the plan for the full year, Ho Chi Minh City 17 trillion VND, 35.8 percent and Quang Ninh 8.46 trillion VND, 60.9 percent.

The Vietnamese Government targeted to disburse all public investment planned for this year as well as the public investment sums transferred from previous years in an effort to accelerate post-pandemic economic recovery.

This means that about 630 trillion VND must be disbursed this year.

Prime Minister Nguyen Xuan Phuc asked the Ministry of Planning and Investment and the Ministry of Finance from the beginning of August to transfer public capital from ministries and localities which failed to make disbursement to projects which could spend the money.

The finance ministry’s report showed that about 160 trillion VND was disbursed in the first half of this year.

Vietnamese green mango exports to Australia double

Figures released by the Australian Department of Agriculture revealed that exports of Vietnamese green mangoes to Australia doubled year-on-year in the first six months of this year.

During the period, a total of 124 tonnes of Vietnamese green mangoes were imported into Australia, up 51 tonnes against the same period last year.

According to a report by ABC Rural, the competition from Vietnamese mangoes has made the price in Southern Territories drop some 40 per cent, from about A$80 (US$63) per tray last year to A$50 ($35) per tray this year.

Most of the exported green mangoes were sold to restaurants, not supermarkets, where they were used in Southeast Asian cuisine.

Since July 20, Vietnamese durian has been promoted in Australia by the Vietnamese Commercial Affairs Office in Australia and the New South Wales-based ASEAN company. The firm has imported 7 tonnes of frozen durian from the Southeast Asian country.

Frozen durian products, which are mainly imported from countries like Thailand, Malaysia, China, and Viet Nam, are increasingly finding favour among Australian consumers. 

Bamboo Airways to open new routes to Con Dao

Bamboo Airways has said it plans to set up new air routes from Hanoi, Ho Chi Minh City and the Mekong Delta city of Can Tho to Con Dao from August 18.

In order to serve these routes, Bamboo Airways plans to rent two Embraer E195 aircraft, which has 118 seats each.

Recently, the airline officially put into operation two new routes connecting Thanh Hoa city in the north-central province of Thanh Hoa with Quy Nhon city in the south-central province of Binh Dinh and with Phu Quoc Island off the coast of the Mekong Delta province of Kien Giang.

Bamboo Airway is working on recovering all of its domestic routes following the COVID-19 hiatus. According to the latest data from the Civil Aviation Authority of Vietnam, the airline’s throughput in June surpassed that in the same period last year. In the first five months of 2020 it also posted the highest on-time performance (OTP) rate in the domestic industry, at nearly 96 percent, with all flights deemed safe.

ABBANK shrugs off pandemic effects, hits first half profit target

ABBANK has achieved its target for the first half with pre-tax profits of VND628 billion (US$27.1 million).

Deposits increased by 10 per cent year-on-year to VND71.3 trillion ($3.07 billion), and total outstanding loans rose 16.7 per cent to VND63.01 trillion ($2.7 billion).

Its non-performing loans ratio was 2.13 per cent, a 0.41 percentage point increase since the end of 2019.

Return on equity (RoE) and return on assets (RoA) were at 15.7 per cent and 1.3 per cent, respectively.

Le Hai, acting CEO of the lender, said ABBANK’s performance in the first two quarters of the year was steady despite the difficulties posed by the Covid-19 pandemic.

“ABBANK is determined to … fulfil its business targets in the last six months of the year when the market is still facing many difficulties.

“We attach special importance to risk control to both optimise business performance and ensure safe, steady and sustainable development.” 

Masan revenues rise a whopping 103.3 per cent in H1

Masan Group Corporation reported consolidated net revenues of VND35.4 trillion (US$1.52 billion) for the first half of the year, a year-on-year increase of 103.3 per cent.

This was driven primarily by high double-digit growth at The CrownX, it said.

The core net profit after tax and post-minority interest (NPAT Post-MI) was VND195 billion ($8.39 million) in the second quarter and VND117 billion ($5.04 million) in the first half, down from the corresponding periods of last year.

That was mainly due to the consolidation of VCM Services and Trading Development JSC, parent of VinCommerce, operator of VinMart, VinMart+ and VinECO in the first half, which delivered a negative VND1.058 trillion ($45.45 million) in earnings.

However, Masan’s earnings benefited from MCH’s earnings growing by 24.1 per cent and a higher contribution from Techcombank.

Masan unveiled at its AGM that The CrownX, an integrated consumer-retail platform established to accelerate the modernisation of Viet Nam’s retail sector.

Phase 1 is focused on developing a scalable grocery platform that will be the foundation for a holistic online-to-offline point-of-life eco-system, allowing TCX to go beyond groceries and service consumers’ financial life, healthcare and entertainment.

TCX, which consolidates Masan’s interests in its FMCG and retail businesses, posted a topline of VND12.592 trillion ($540.9 million) in the second quarter and VND25.848 trillion ($1.1 billion) in the first half, up 20.5 per cent and 26.8 per cent.

TCX delivered EBITDA of VND676 billion in Q2 and VND1.26 trillion in the first half, increases of 80.7 per cent and 58.3 per cent.

Its EBITDA margin in the first half increased to 4.9 per cent from 3.9 per cent a year earlier.

The integration of Masan’s FMCG and retail businesses into a combined platform began in the first half and the management expects this process to further accelerate in the second half to improve both top- and bottom-line results.

In the second quarter Masan acquired an additional 12.6 per cent stake in TCX for $862 million, reflecting the management’s confidence in the value creation potential of TCX.

Masan MEATLife (MML)’s meat business continued to scale up while enhancing operational efficiencies, and its revenues topped VND1.055 trillion in the first half, with the momentum demonstrated by the 32.7 per cent growth in Q2 versus Q1.

MEATDeli, MML’s flagship meat brand, increased its revenue per outlet per day by 22 per cent to VND3.6 million from VND3 million in Q2.

The market share in Q2 was 2.1 per cent in HCM City and 3.6 per cent in Ha Noi.

The integrated meat business generated positive first half EBITDA of VND34 billion, with VND30 billion coming in Q2, demonstrating strong quarter to quarter momentum.

MML currently procures 40 per cent of its meat from qualified third parties at open market prices, adversely impacting profitability due to all-time high livestock prices.

It is working on strategic alternatives to develop a more sustainable supply chain model but also believes that live hog prices will normalise over the next six to 12 months since the pig population has increased by 30 per cent in April 2020 compared to December 2019.

Another subsidiary of the group, Techcombank, continues to post stellar results despite having to navigate the COVID-19 pandemic, with profit before tax growing by 19 per cent year-on-year to VND6.738 trillion in the first half.

As highlighted at Masan’s AGM, the management believes that there are significant synergies that enable maintaining of TCB’s growth over the medium term by integrating the bank’s services and products with TCX’s retail platform.

Masan High-Tech Materials (MHT), formerly named Masan Resources (HNX-UPCoM ticker remains MSR), was adversely impacted by the shutdown of the global economy due to COVID-19.

Its net revenue was flat in Q2 compared to the period a year ago, helped by one month of sales contribution (VND486 billion) from the acquisition and consolidation of H.C. Starck’s global tungsten business.

This acquisition delivers on MHT’s vision to move beyond being an upstream tungsten producer into a global high-tech materials platform.

The management’s focus in the second half of the year will be to integrate the businesses and develop a supply chain and sales model to generate consistent cash flows throughout tungsten price cycles.

It expects the results to be reflected in Q4 this year and Q1 2021 at the latest.

Dr Nguyen Dang Quang, Masan’s chairman, said: “We have transformed many FMCG categories but our share of the consumer wallet is only 1 per cent. CrownX is our strategic bet to transform the entire grocery space both in terms of products and services.

“We aim to serve at least 50 million consumers for their daily grocery needs, increasing our share of the consumer wallet to 25 per cent. Grocery is the foundation to win consumer loyalty but not the endgame.”

MSN’s profitability is expected to improve further in the second half driven by TCX’s continued growth in its consumer product portfolio and the turn-around game plan for its store network starting to yield results due to improving costs, better assortment and network optimisation, greater operational efficiencies in MML and MHT and continued positive bottom line contribution from TCB. 

Aquatic firm set to be removed from the stock market

Aquatic exporter Hung Vuong Group will cancel its listing on August 8 due to violations of information disclosure rules, the Ho Chi Minh Stock Exchange (HoSE) has said.

The southern market regulator will delete more than 227 million shares of Hung Vuong to protect the benefits of investors in accordance with the Law on Securities.

Hung Vuong’s shares were suspended on May 15 as the company kept violating the rules on information disclosure after it had been strictly controlled since March 2018.

The company has not released its financial reports for the 2019 financial year, which lasted from October 1, 2018 to September 30, 2019, and for the first quarter of 2020 despite repeated reminders from HoSE.

Hung Vuong in early June said in a filing to HoSE that it had to delay financial reporting because of the lack of accountants and some missing statistics.

Several accountants quit their jobs and moved to new companies on worries about lower income amid the COVID-19 pandemic, which made the firm unable to gather financial data on time, the company said.

In addition, letters of debt validation had not been collected by the end of the fourth quarter of 2019 from foreign partners, so the data was not sufficient enough to be reported, it said.

Hung Vuong had committed to complete compiling the two reports by June 15, but it has failed to do so.

HoSE has flagged three warnings to the company about delaying the publication of its 2020 first-quarter financial report.

The company was once among top aquatic firms. In 2016, Hung Vuong’’s total revenue was more than VND18 trillion (US$786 million).

However, failures in mergers and acquisitions (M&A) using financial leverage put the company under debt pressure and performance has declined from one year to another.

In the 2019 financial year, Hung Vuong posted an annual drop of nearly 50 per cent in total revenue, which was VND4.1 trillion.

The company recorded a post-tax loss of VND1.07 trillion in 2019 while earning a post-tax profit of VND1.5 trillion in the previous year.

Notably, total debts in the financial year of 2019 increased by 10.4 per cent on-year to VND7.1 trillion while owner’s equity capital dipped 57.2 per cent on-year to VND916 billion.

Hung Vuong shares are valued at VND5,400 apiece since May 14. 

 
 

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