Vietnam trade surplus widens to US$4 billion in H1
Vietnam's trade turnover is likely to have reached US$238.4 billion in the first half this year, down 2.1% year-on-year.
Vietnam reported an estimated trade surplus of US$500 million in June, expanding the country’s trade surplus to US$4 billion in the January – June period, compared to a US$1.7-billion surplus recorded in the same period last year, the General Statistics Office (GSO) has said in a monthly report.
On breaking down, the domestic-invested sector is estimated to post a trade deficit of US$10.2 billion in the six-month period while foreign-invested firms recorded a trade surplus of US$14.2 billion.
Domestic companies' exports are estimated to have expanded 11.7% year-on-year to US$41.38 billion during the period, accounting for 34.1% of the country's exports. Meanwhile, FDI firms reaped US$79.83 billion from overseas shipments, down 6.7% and accounting for 65.9% of the total.
In June, Vietnam exported goods worth an estimated US$21 billion, up 9.5% inter-monthly, while imports are estimated to have increased by 12.8% to US$20.5 billion.
The complicated progression of the Covid-19 pandemic in Vietnam’s major markets continued to exert negative impacts on the country’s trading activities, noted the GSO.
Overall, Vietnam's trade turnover is likely to have slipped 2.1% year-on-year to reach US$238.4 billion in the January–June period, down 2.1% year-on-year. Of the total, its exports slipped 1.1% year-on-year to US$121.21 billion, and imports are estimated at US$117.17 billion, down 3%.
Among Vietnam's major trading partners, the country’s trade surplus with the European Union (EU) witnessed a sharp decline of 18.9% year-on-year during the six-month period to US$9 billion, while its trade deficit with China decreased 19.3% to US$15.3 billion.
Vietnam’s trade deficit with South Korea and ASEAN also shrank by 18.3% and 2.4% year-on-year, respectively, to corresponding US$11 billion and US$3.1 billion.
Business formations in Vietnam maintains growth momentum, up 28% m/m in June
The number of newly established enterprises in Vietnam in the first six months of 2020, however, fell 7.3% year-on-year to 62,000.
Two months after the end of social distancing orders in Vietnam, economic activities have gradually returned to normal and led to a surge of 27.9% month-on-month in new business formations to 13,700 in June, according to the General Statistics Office.
Business formations in Vietnam maintains growth momentum to 28% m/m in June.
This month also witnessed a sharp month-on-month increase of 23.4% in combined registered capital to VND139.1 trillion (US$5.97 billion). Employees recruited by new enterprises rosee 9.4% to 100,000.
However, the number of newly-established enterprises in Vietnam in the first six months of 2020 was over 62,000 with registered capital of a combined VND697.1 trillion (US$30.07 billion), dropping 7.3% in number and 19% in registered capital year-on-year. Average registered capital per newly-established enterprise was VND11.2 billion (US$483,169) during this period, down 12.5% year-on-year.
Taking into account VND984.4 trillion (US$42.47 billion) of additional capital pumped by active enterprises, total registered capital injected into the economy in the January-June period was VND1,681.5 trillion (US$72.55 billion), down 22.5% year-on-year.
The government-run office informed that 25,200 enterprises resumed operations, an increase of 16.4% against the comparable period last year, bringing the total number of newly-registered and reinstated enterprises in the six-month period to 87,200, down 1.5% year-on-year.
The GSO added that the number of laborers of newly-established enterprises between January and June was 507,200, down 21.8% against the same period last year.
During this period, the number of enterprises temporarily ceasing operations surged 38.2% year-on-year to 29,200.
Moreover, the number of enterprises which completed procedures for bankruptcy was down 5% to 7,400.
A survey on the business sentiment in the manufacturing and processing in the second quarter of 2020 revealed 27.3% of enterprises saw improvements in business performance compared to the previous quarter; 40.8% were facing difficulties and 31.9% said their business is stable.
For the third quarter of 2020, 49.1% of the surveyed enterprises predicted positive outlook for their operation compared to the second quarter; 19.4% expected difficulties and 31.5% saw stability.
Hit by Covid-19, Hanoi GRDP grows 3.39% in H1
The growth rate, however, remains among the highest nationwide and is significantly higher than the national growth average of 1.81% during the period.
Despite severe economic impacts of the Covid-19 pandemic, Hanoi’s gross regional domestic product (GRDP) is estimated to have expanded 3.39% in the first half of 2020, the slowest 6-month growth in many years, according to Nguyen Manh Quyen, director of the municipal Department of Planning and Investment.
The growth rate, however, remains among the highest nationwide and is significantly higher than the national growth average of 1.81% during the period, Quyen informed at a meeting on June 29.
During the six-month period, Hanoi’s Index of Industrial Production (IIP) grew 3.5% year-on-year, significantly lower than a rise of 7.4% recorded in the same period last year.
Specifically, the mining industry’s output decreased 11.8% year-on-year between January and June, while the manufacturing and processing industry expanded at 3.3%.
Production and distribution of electricity rose 6.1% year-on-year; and water supply, sewage treatment and waste water collection was up 5.5%.
Total retail sales of consumer goods and services in Hanoi in the six-month period are estimated to expand 6.6% year-on-year, while the Covid-19 pandemic has caused a disruption to the global value chain, leading to a decline of 6.7% year-on-year in Hanoi’s exports at US$6.75 billion. Its imports have fallen 9.2% to US$13.7 billion.
The consumer price index (CPI), the main gauge of inflation, expanded 3.68% year-on-year in the period.
As tourism is one of the hardest-hit groups by the pandemic, total number of tourists to Hanoi plunged 65.4% year-on-year to 4.93 million in the January – June period, including a decline of 68.8% in foreign tourists and a contraction of 61.5% in revenue from tourism activities.
On the bright side, Hanoi’s authorities have acted drastically for improving the business environment, which helped the city be included in the top 10 localities having the highest Provincial Competitiveness Index (CPI) scores in 2019 and second nationwide in the Public Administrative Reform Index (PAR Index).
Hanoi has recorded 12,649 newly established enterprises in the first half of 2020 with registered capital of a combined VND175 trillion (US$7.55 billion), down 7% in the number but up 5% in value year-on-year.
The city's state budget revenue dwindled 3.4% year-on-year to VND124.84 trillion (US$5.38 billion), or 44.8% of the year's plan, while the budget expenditure climbed 21.5% year-on-year to VND34.21 trillion (US$1.47 billion), or 33.2% of the yearly plan.
Hanoi has so far disbursed VND14.82 trillion (US$639.45 million) worth of public investment, or 33% of the target.
Based on preliminary data from the first half of 2020, Hanoi’s authorities have devised two growth scenarios for the remaining six months of the year.
In the first scenario and also the most optimistic one, Hanoi could achieve a growth rate of 5.9%, 1.3 times higher than the nation’s optimistic growth scenario from 4.4 – 5.2%, if growth rates in the third and fourth quarters reach 7.8% and 8.4%.
In a second scenario, Hanoi’s GRDP would expand 5.4%, 1.3 times higher than the nation’s neutral growth scenario of 3.6 – 4.4%, if the city’s economy expands 6.9% and 7.4% in the third and fourth quarters, respectively.
Secretary of Hanoi’s Party Committee Vuong Dinh Hue said the city aims for an economic growth rate at 1.3 times higher than the national average and strives to fulfill the state budget revenue targets set by the National Assembly for this year.
Vietnam plywood may escape US anti-dumping probe
Vietnamese products made from local materials or imported from countries other than China could escape anti-dumping sanctions.
The fact that the amount of wood harvested annually in Vietnam is sufficient to produce 8.4 million cubic meters of plywood, four times higher than the exported volume, may help the country win over US accusations of the product using Chinese components to circumvent US duties on imports from China.
Vietnamese products made from local materials or imported from countries other than China could escape anti-dumping sanctions.
In 2019, total export of hardwood plywood in Vietnam reached 2.5 million cubic meters, significantly lower than the country’s production capacity, Tuoi Tre cited a report from the Trade Remedies Authority of Vietnam.
As a result, Vietnam is capable to provide sufficient input materials for domestic plywood production. Under the US perspective, Vietnamese products made from local materials or imported from countries other than China could be exempted from anti-dumping duties.
At a press conference on June 11, Spokesperson of the Vietnamese Ministry of Foreign Affairs (MoFA) Le Thi Thu Hang urged any possible US probe into plywood imports from Vietnam should be fair.
Vietnam remains steadfast on enhancing bilateral trade–economic–investment relations with the US towards building harmonious, sustainable and mutually beneficial ties, Hang added.
Hang stated Vietnam is committed to adhering by WTO rules and has been focusing on fighting against trade fraud and the circumvention of customs duties.
According to the Ministry of Industry and Trade, after initiating a probe, the US would send questionnaires to traders related to Vietnam for more information.
The US Department of Commerce (DOC) would take into account five factors to determine whether a product from certain country is considered to have circumvented trade protection measures, including (i) the level of investment; (ii) the level of research and investment; (iii) the nature of the production process; (iv) the extent of production facilities; and (v) whether the value of the processing performed in the country represents a small proportion of the value of the merchandise imported into the US.
In case the DOC concludes Vietnam’s hardwood plywood is in fact has circumvented US duties, the product would face anti-dumping duty of 183.6% and anti-subsidy duties ranging up to 194.9%, similar to those from China.
In 2019, Vietnam exported around US$300 million worth of plywood to the US.
Vietnam needs reform 3.0 to further improve business environment
The majority of business conditions still allow state agencies to interfere deeply in enterprises’ rights to freedom of doing business, said an expert.
Following the two waves of reform in 2016 and 2018 to ensure no addition of business conditions and removal of obsolete ones, the business community now needs a third wave to get rid of overlapping regulations, according to Vu Tien Loc, chairman of the Vietnam Chamber of Commerce and Industry (VCCI).
“The expectation is that this could happen right in this government tenure [2006-2021],” Loc said at a workshop on the country's business environment on June 24.
According to Loc, there is a ministry reporting inaccurately that it has cut 60% of business conditions, but in fact, the number figure is only 30 – 40%.
In the process of reviewing existing legislation related to business/investment activities, VCCI is advising the government to remove 25 overlapping provisions in legal documents, Loc said, but admitted only some of them would be removed.
Nguyen Thi Dieu Hong from VCCI’s Legal Department said the agency has conducted a survey to seek opinions from the business community regarding current regulations for business activities.
From this process, VCCI has recommended ministries and government agencies to revise 93 legal documents, 32 laws, 51 decrees and 10 circulars to address the issue of overlapping regulations that have been restricting businesses activities, Hong said.
“While it is necessary for some business activities to be licensed before operation, a major part of current business conditions empowers state agencies to interfere deeply in enterprises’ rights to freedom of doing businesses,” Hong added. This could be the case of enterprises being required to set up a distribution network or to submit business methods.
Meanwhile, some requirements for market entry remains complicated and need further simplification, as they are major obstacles for small and medium enterprises, Hong stated.
Nguyen Hoai Nam, vice general secretary of the Vietnam Association of Seafood Exporters and Producers (VASEP), said ministries and agencies have been slow in realizing the government’s resolutions to improve the business and investment environment.
Nam referred to the fact that in the field of seafood processing and export, some Vietnamese criteria are even more difficult to comply with compared to that of the US, indicating that government agencies are making it harder for local enterprises.
During the 2020–2025 period, the government targets to trim off and simplify at least 20% of existing business conditions as well as 20% of compliance costs from current legislation until May 31, 2020.
Ministries and ministerial-level agencies are requested to reduce as many as possible the number of legal documents setting new business conditions.
Since the beginning of this government tenure in 2016, over 3,800 out of a total of 6,191 business conditions have been simplified or removed. In addition, 6,776 out of 9,926 categories of goods subject to specialized inspection have been abolished.
The move helps save 18 million working days per year, equivalent to over VND6.3 trillion (US$270.24 million) annually.
Vietnam's disbursement of ODA funds more than triples y/y in H1
The disbursed amount, however, remains significantly lower than expected.
Vietnam’s disbursement of official development assistance (ODA) funds in the first half of this year stood at VND7.42 trillion (US$318.92 million), equivalent to 13.1% of the year's plan and being 3.6 times the figure recorded in the same period last year, according to Tran Xuan Ha, vice minister of finance.
Despite improvements, the disbursement rate remains significantly lower than expectation, Ha said at a conference on June 25.
Without strong measures to speed up the process, a slow disbursement of public investment funds and also that of the ODA could have serious consequences on the government’s efforts to stabilize macro-economic conditions, eventually affecting the prospects of realizing socio-economic targets, Ha stated.
Truong Hung Long, director of the Department of Debt Management and External Finance under the Ministry of Finance (MoF), attributed the Covid-19 impacts, among others, to a delay in the implementation of ODA-funded projects.
Specifically, most ODA-financed projects would require the import of equipment and machinery abroad, or the mobilization of foreign experts, engineers or consultants, Long added, saying all these activities have been suspended during the Covid-19 outbreak.
Additionally, changes in ODA policies, slow site clearance process, contractors’ limited capacity, disputes between project owners and contractors, are among notable issues preventing a faster ODA disbursement.
Long said the MoF would continue to cooperate with other government agencies and provinces/cities in addressing bottlenecks during the ODA disbursement process.
Low disbursement rate could lead to additional costs and higher commitment fees for the government, which are charged by a lender to a borrower for an unused credit line or undisbursed loan.
More importantly, there could be potential contract disputes between project owners and contractors, affecting Vietnam’s credibility, Long added.
Hanoi works to promote green growth toward 2030
Hanoi has developed and implemented green growth action plans.
Hanoi has taken action to promote green growth toward 2030, laying an important foundation to transform the growth model in the city.
Currently, adjusting urban planning towards green growth and climate change adaptation is the capital city’s top priority.
Do Viet Chien, former director of the Urban Development Department under Ministry of Construction, told Hanoitimes that Hanoi is facing many challenges in its green growth process.
Outside the comfortable apartments with smart appliances, there remain dust, noise, inundation, traffic congestion and waste pollution, Chien noted.
“The problem is how to make green and smart thinking become an urgent need and the choice of the majority. There must be an urban link, among the public sector, the investors and the beneficiaries so that all parties understand the urgency of the issue and reach a consensus in action to build a green city,” Chien said.
According to architect Le Anh Tuan, Hanoi is expanding aggressively. Urbanization is not only about massive urban immigration or urbanization, but it is also about sustainable and green development.
"I think Hanoi’s authorities are paying special attention to the issue, evidenced by the project on sustainable smart city development for the period of 2018 - 2025 with vision to 2030," Tuan said.
He stressed that Hanoi has developed and implemented green growth action plans. Local residents and businesses have come to a common understanding about achieving green growth, considering it an important task.
Besides, specialists have recommended revisions to tax policies in order to steer the economy towards green growth and sustainable development in the capital city.
Specially, the municipal government has found solutions to boost green production and consumption, reduce greenhouse gas emissions, adapt to climate change, and develop green technologies and resource efficient industries in order to encourage manufacturers to invest in environmental protection, Tuan said.
According to Deputy Director of the Hanoi Department of Natural Resources and Environment Bui Duy Cuong, the municipal government has carried out a host of actions to promote green growth in the city.
The city has formulated and implemented its Green Growth Action Plan, Cuong said, adding that the city has identified this as an important task to implement in different aspects: resource mobilization, institutional and policy improvement, capacity strengthening, and new technology application.
“More importantly, specific activities have yielded encouraging results and valuable lessons have been drawn to realize the capital city's action plan in compliance with the 2030 Agenda for Sustainable Development,” Cuong told Hanoitimes.
He added that Hanoi has focused on improving efficiency of key sectors such as construction, transportation, energy-intensive industrial processes, applying advanced technologies to reduce greenhouse gas which are favorable for transformative action.
A series of annual activities have been also underway in the capital city towards a green and sustainable Hanoi.
An outstanding activity themed “What is happening to the environment in Hanoi?” is annually held in response to the action month for the environment in the city, raising awareness about environmental pollution. In addition, an exhibition of installation art works made from plastic straws, plastic bags and bottles is held. It also gives instructions on how to lead a green lifestyle and recycle products.
Besides, “Reducing nylon and plastics”, “Using clean energy” and “Sustainable consumption products” are programs to introduce young people and businesses’ green ideas and promote reducing, recycling and reusing waste.
These activities are part of efforts to connect state managerial agencies with civil organizations, schools and businesses to encourage joint efforts in protecting the environment as well as promote green growth in the capital city.
Vietnam H1 GDP growth drops to decade-low on Covid-19
Manufacturing and processing remained the driving force of the economy in the first six months with an expansion of 4.96% year-on-year.
Vietnam’s GDP has expanded 1.81% year-on-year in the first half of 2020, the lowest six-month growth rate in the past 10 years, dragged down by the growing impacts of the Covid-19 pandemic and global uncertainties, the General Statistics Office (GSO) has announced.
In the second quarter, the country’s GDP growth is also estimated at a 10-year low of 0.36%.
Duong Manh Hung, director of the GSO’s System of National Accounts Department, told VnExpress the country’s GDP growth of 1.81% in the first half of the year was even lower than GSO’s least optimistic growth scenario.
As the government prioritizes the fight against the pandemic to economic growth, a positive economic growth rate in the January – June period indicates strong efforts of both the government and the whole society to maintain business operations while combating Covid-19, said the GSO in a quarterly report released Monday.
In the January – June period, the sector of agriculture, forestry and fishery increased by 1.19%, contributing 11.89% to the overall growth; the sector of industry and construction rose by 2.98%, contributing 73.14%; and the service sector climbed by 0.57%, contributing 14.97%.
In the industry and construction sector, the industry expanded 5.28% year-on-year in the second, significantly lower than the 10.45% growth rate of Q1/2019 and contributing 1.89 percentage points to the overall growth.
Manufacturing and processing remained the driving force of the economy in the first six months with an expansion of 4.96%, along with whole sale and retail with a growth rate of 4.3%, finance – banking and insurance with 6.78%.
Regarding the structure of the economy during the first half of the year, the sector of agriculture, forestry and fishery made up 14.16%; the sector of industry and construction accounted for 33.44%; the service sector represented 42.04%; and product taxes less subsidies on production accounted for 10.36%.
In terms of GDP use during this period, the final consumption rose by 0.69% against the same period of last year; accumulated assets grew by 1.93%; trade balance of goods and services shrank by 2.23%.
The growth target of 6.8% for this year, thus, has become unrealistic in this current crisis, which would required growth rates of over 10% in the last two quarters, Hung from GSO commented.
The International Monetary Fund (IMF) has forecast Vietnam's economy to grow 2.7% this year, the highest in Asia.
Vietnamese fruits conquer the world market
The reorganization of agricultural production has helped Vietnamese fruits to continuously welcoming good news in conquering the import markets.
According to the Ministry of Agriculture and Rural Development (MARD), Vietnamese fruits have now been present in 60 markets around the world, of which China is the largest importer with a market share of 66.8%, followed by the United States (4%), the Republic of Korea (ROK), Japan and Europe.
Some demanding markets, such as the U.S., Australia and Japan are opening the door wider to Viet Nam’s high-quality fruits.
Therefore, businesses will have greater opportunities if they accelerate the introduction and promotion of their products at international agricultural and food fairs, such as Anuga (Germany), Sial (France), Moscow (Russia) and Foodex (Japan), to meet global customers and seize the needs of customers in each region.
“To affirm their position and increase the value of their export goods, Vietnamese enterprises should step up fruit processing, which will help to raise products’ value by 10 to 20 times compared to fresh fruits,” Dinh Cao Khue, General Director of Dong Giao Foodstuff Joint Stock Company, emphasized.
Perhaps, this is very positive and proud information concerning Vietnamese fruits in particular and Vietnamese farm produce as a whole, especially in the context of the COVID-19 pandemic causing a lot of difficulties for the consumption of many agricultural products and fruits.
Viet Nam is looking to become a logistics provider of the world. Agricultural production according to the industrial thinking approach is gradually emerging in the country.
To realize this, the domestic agricultural sector is aiming towards developing value chain linkages, especially the building of material zones associated with digitization and origin traceability, thus changing farmers’ thinking of rudimentary farming.
According to the General Department of Viet Nam Customs, the country’s fruit exports in 2019 were estimated at US$ 3.85 billion, representing a 6.9% increase compared to the target set for the year.
Being a tropical climate country, especially in southwest region, Viet Nam has rich lands with immense orchards and various kinds of fruits all year round. Fruit is one of the key Viet Nam products in world markets./.
China enhances control of exported farm produce: MoIT
The Consulate General of Việt Nam in Guangxi Province, China and the Asia-Africa Market Department have warned local businesses that Guangxi is carrying out a number of measures to strengthen control of food origin and quality, according to the Ministry of Industry and Trade (MoIT).
Therefore, the ministry recommends local businesses and households producing agricultural and seafood products exported to China to enhance management of quality for their exports.
They should also coordinate with import partners in China to ensure that their export products meet China regulations on quality standards, quarantine, food safety and traceability for import goods, it said.
The enterprises need to actively monitor market information to regulate volume of export goods transported to border gates, thereby contributing to reducing risks and time during implementing customs clearance for goods at border gates.
The Consulate General of Việt Nam in Guangxi Province said Guangxi is strictly managing goods that are consumed at markets and supermarkets as well as strengthening inspection of certificates on quality standards and origin and procedures relating to purchasing agricultural products there.
Guangxi bans trading and storage of foods that do not meet food safety standards and require quarantine certificates from China customs for imported food products.
This province would strengthen its management of fresh and frozen foods, including seafood and seafood products, pork, beef and lamb, to eliminate disease risks from those products, reported toquoc.vn.
Dongxing City, China, sharing the border with Móng Cái City, Quảng Ninh Province, is also carrying out inspections of the origin and quality of seafood and meat products at agricultural markets, supermarkets and hotels.
That would affect Vietnamese farm produce exported to this market, according to the ministry.
HCM City should seek to push ahead with ODA disbursement: Deputy PM
Deputy Prime Minister Pham Binh Minh on June 29 urged Ho Chi Minh City to ask for the facilitation of the implementation of Metro Line No. 1 project in order to increase public disbursement for the locality.
At a working session with the municipal People’s Committee, Minh said foreign experts of the project are now unable to return to Vietnam due to the COVID-19 pandemic.
As for issues regarding other ODA projects, the official said relevant ministries and HCM City need to race against time to benefit from ODA incentives.
Nguyen Thanh Phong, Chairman of the HCM City People’s Committee, said the locality has capacity for ODA disbursement that, however, is now slow due to bottlenecks from many agencies, citing the issue regarding the JPY-VND rate in the above-said project.
The committee reported that the city has nine ODA projects with total investment capital amounting to nearly 123 trillion VND (5.28 million USD), including 102 trillion VND worth of ODA.
In the first six months of this year, only one fifth of the capital has been disbursed, it said.
Japanese airline asked to resume flights to Cambodia
To encourage Japanese investors, the Cambodian Chamber of Commerce (CCC) and the Japanese Business Association of Cambodia (JBAC) are planning to request the All Nippon Airways (ANA) - Japan’s largest airline - to resume direct flights to Cambodia ahead of a scheduled September return, according to the Phnom Penh Post.
The idea was proposed by President of CCC Kith Meng and newly appointed president of JBAC Yogo Kanda.
According to CCC Vice President Lim Heng, the two sides are planning to send an official letter to ANA to request for its resumption of direct flights to Cambodia as soon as possible because the delay has hampered the return of Japanese investors to the Southeast Asian nation.
This will benefit the tourism, culture and business sectors of both sides, he said.
ANA has operated direct flights between the two countries since 2016 but the firm closed its Phnom Penh office on April 1 with a plan to resume operation in September.
Flights to Cambodia have dropped 98 percent because of the COVID-19 pandemic, according to the Civil Aviation Authority of Cambodia.
Thailand’s tapioca output forecast to drop in 2020-2021 crop
Thailand's overall tapioca production for the 2020-2021 crop would be below 20 million tonnes, compared with 20-22 million tonnes in the 2019-20 season, Boonchai Srichaiyongpanich, President of the Thai Tapioca Trade Association, has predicted.
Normally, the country's tapioca production stands at 28-30 million tonnes, with demand amounting to 40 million tonnes a year.
Tapioca business operators have called on the government to speed up tackling the cassava mosaic disease that has ravaged the farmers' produce since 2018.
The mosaic disease has spread to various key production bases in Thailand, such as Nakhon Ratchasima, Sa Kaeo, Buri Ram, Surin, Si Sa Ket, Prachin Buri and Chachoengsao.
Booonchai said without effective preventive measures and decisive enforcement, the disease now affects 11,200 ha in 18 provinces, with about 1.28 million ha in 50 provinces still to be surveyed concerning the disease's impact.
According to Boonchai, the government should establish a specific centre to handle tapioca disease in the same way the Centre for COVID-19 Situation Administration handles the deadly virus crisis.
Last year, Thailand saw tapioca product exports drop both in value and volume, with the value down by 16.4 percent to 2.6 billion USD and volume down 20.4 percent to 6.6 million tonnes.
The association expects exports to drop below 2.4 million tonnes this year from 2.4 million tonnes, 3 million, 4 million and 6 million the previous four years, respectively.
Cambodian logistics providers predicted to face bankruptcy amid COVID-19
The on-going COVID-19 pandemic is seriously damaging Cambodian logistic providers, with about 10-15 percent heading for bankruptcy in the upcoming months, according to the Cambodia Freight Forwarders Association (CFFA).
The Khmer Times quoted CFFA President Sin Chanthy as saying that many providers are struggling to survive, some had already gone bankrupt, and others will file for bankruptcy within the next two or three months.
The logistics providers have been adversely affected the COVID-19 pandemic, and it hasn’t seen any sign as to when the situation will recover, he said.
Chanthy added that the traffic of goods and product exports have dropped about 70-80 percent because there has been a dramatic decrease in buying orders.
More than 100 member logistics firms of CFFA are struggling to survive as they are facing financial distress, with an estimated 60 percent decrease in revenue, he said.
The Cambodian Government decided to cut the 2021 State budget to 4 billion USD due to the impact of COVID-19, 50 percent drop from this year’s State budget. The Southeast Asian nation’s economy is expected to grow by 3.5 percent next year.
Previously, the Asian Development Bank predicted Cambodia’s economic growth will expand 2.3 percent in 2020, while the International Monetary Fund forecast that Cambodia's GDP will experience a negative growth of 1.7 percent in 2020.
Conference sought to help businesses accelerate post-pandemic development
A conference discussing measures to fully tap into opportunities brought about by the EU-Vietnam Free Trade Agreement (EVFTA) and support Vietnamese enterprises in promoting post-pandemic development was held in Hanoi on June 29.
The event is part of a chain of seminars hosted by the Ministry of Industry and Trade after the National Assembly officially ratified the agreement on June 8.
Addressing the conference, Deputy Minister of Industry and Trade Tran Quoc Khanh said that with its deep commitments, the EVFTA is hoped to further promote trade and investment relations between Vietnam and the EU in particular as well as foster Vietnam’s international economic integration in general.
Vietnam’s export and import turnover were down 2.8 percent in the first five months of 2020, he said, due to the impact of the COVID-19 pandemic.
Once in effect, the EVFTA will provide impetus for Vietnamese enterprises to recover and promote production and business activities, he said.
Businesses can join new supply chains to replace traditional supply chains that have been disrupted by the COVID-19 crisis, while expanding and diversifying their export markets to minimise dependence on certain market groups, he added.
Pham Tuan Anh, deputy head of the International Cooperation Department at the Ministry of Finance, said that similar to FTAs Vietnam has signed with partners and implemented previously, MoF is also proactive in building and implementing relevant plans it is in charge of.
According to Phan Thi Thanh Xuan, Vice Chairwoman and General Secretary of the Vietnam Leather and Footwear Association (Lefaso), the implementation of the agreement will help businesses accelerate their exports, especially to the European market, because it accounts for nearly 30 percent of Vietnam’s export turnover.
According to representatives from Lefaso, it is necessary to develop support industries because the financial strength of small- and medium-sized enterprises is not enough to be self-sufficient in producing raw materials, so strategies to strengthen the supply of raw materials for production are necessary.
Businesses also need to participate in domestic and foreign chains and be closely linked with domestic and foreign suppliers to respond to fluctuations in a timely manner, they said.
Grab contributes 5.45 bln USD to Indonesian economy: Research
Ride-hailing firm Grab Indonesia contributed 77.4 trillion rupiah (5.45 billion USD) to the Indonesian economy last year, largely thanks to its food delivery service, while providing gig work for the country’s informal workers, according to a research conducted by the Centre for Strategic and International Studies (CSIS) and Tenggara Strategics.
The research revealed that the biggest source of Grab’s contributions to the economy came from its food delivery service GrabFood, which contributed 37.3 trillion rupiah of the total 77.4 trillion rupiah. The overall 2019 figure marks a 58.3 percent increase from the firm’s 48.9 trillion rupiah in 2018.
The data was calculated based on the incomes of more than 5,000 surveyed Grab partners and merchants before and after joining Grab, across its four services – motorcycle taxi service GrabBike, ride-hailing service GrabCar, GrabFood and merchant GrabKios.
“As Indonesia starts to move past COVID-19, we believe that platforms like Grab and the gig economy can support the country on its road to recovery,” the Jakarta Post newspaper quoted Riyadi Suparno, executive director of Tenggara Strategics, as saying.
With the economic downturn as a result of the COVID-19 pandemic, experts have warned that the country’s 70.49 million informal workers, the majority of the Indonesian workforce, are considered the most vulnerable. Motorcycle taxi drivers association Two-Wheeled Action Movement (Garda) reported a 70 percent decrease in drivers’ daily earnings during the pandemic.
However, the research notes that Grab has provided earning opportunities for those dealing with unemployment, like in 2019, when 31 percent of GrabBike and 26 percent of GrabCar partners had no income prior to joining Grab.
The company’s digital platform would also aid the merchant-partners’ transition to a post-pandemic economy, Riyadi stated.
Being digital-ready will be more important than ever in the new normal. Grab can help businesses adapt by making the shift online through services like GrabFood and GrabKios, Riyadi added.
Earlier this month, Grab Indonesia introduced a new app called GrabMerchant, aimed as a one-stop service platform that allows micro, small and medium enterprises (MSMEs), including those in food and beverage, to digitally manage their operational hours, orders, employees, as well as menus and promotions.
Meanwhile, the head of the CSIS department of economics, Yose Rizal Damuri, noted that Grab, as a digital platform, played a supporting role during the large-scale social restrictions (PSBB).
Tenggara Strategics researcher Stella Kusumawardhani said that, based on the 2019 findings, GrabFood also helped small businesses expand at minimal cost.
In 2019, the research found that GrabFood merchant-partners saw their monthly sales increase by 35 percent to 49.6 million rupiah per month from the average of 36.7 million rupiah per month in 2018.
Electric wire, cable export surges 33.7 percent in five months
Vietnam raked in over 903.8 million USD from exporting electric wires and cables in the first five months of 2020, up 33.7 percent year-on-year, according to statistics of the Ministry of Industry and Trade.
China led more than 20 importers, spending nearly 261 million USD importing Vietnamese electric wires and cables, 55.7 percent higher than that of the same period last year and accounting for 28.9 percent of Vietnam’s total export turnover. It was followed by the US and Japan.
Notably, high growth was seen in the export of the products to Hong Kong (China), Laos, and the UK with 78.9 percent, 72.1 percent and 61.5 percent, respectively./
Second-half GDP growth to outpace first-half result
Vietnam’s GDP in the third and fourth quarters will grow better than it did in the first half of the year as the country still has ample space for growth, a press conference in Hanoi on June 29 heard.
The General Statistics Office (GSO) reported that national GDP in the first half grew only 1.81 percent - the lowest first-half rate during the 2011-2020 period.
Given the global economic downturn, however, Vietnam remains something of a bright spot, it said.
Nguyen Thi Huong, GSO Deputy Director General, pointed to positive signs in agriculture despite the sector being affected by drought, saltwater intrusion, COVID-19, and African swine fever, with rice output in the autumn-spring crop increasing year-on-year.
Industry gave momentum to the national economy, she said, rising 2.71 percent, with processing and manufacturing up 4.96 percent.
Though there were only 62,000 firms established in the first half, down 7.3 percent year-on-year, the number of new enterprises stood at 13,700 in June alone, up 27.9 percent from the previous month.
As at June 20, 15.7 billion USD in FDI had been poured into Vietnam, down 15.1 percent year-on-year.
Export value exceeded 121.2 billion USD, down 1.1 percent year-on year. The country ran a trade surplus of 4 billion USD.
Duong Manh Hung, Director of the National Account System Department under the GSO, said that to reach the growth target of 6.8 percent, the pace must be over 10 percent each quarter, which is a difficult and even impossible task as the COVID-19 pandemic is still developing and affecting global trade.
The Government, therefore, has proposed the National Assembly adjust the growth target, he said.
However, the official stressed that Vietnam still has ample space for growth in public investment.
Pham Dinh Thuy, Director of the GSO’s Industrial Statistics Department, further explained that the disbursement of public investment would stimulate the national economy, saying if public investment rises 1 percent, it would contribute 0.06 percentage points to GDP.
Once 700 trillion VND (30.15 million USD) worth of total public investment is disbursed this year, 0.42 percentage points will be added to GDP, he continued.
Thuy also suggested businesses seek partners and promptly remove difficulties, and that the Government and the NA continue with tax and fee reductions.
Both the Government and businesses need to study solutions regarding institutions, human resources, procedures, production technologies, and business strategies to optimise and adapt to regulations in the EU-Vietnam Free Trade Agreement and the EU-Vietnam Investment Protection Agreement, he said./.
Cambodia: bicycles’ exports near 200 million USD in first five months
Cambodia earned 197 million USD from exports of 876,612 locally-assembled bicycles in the first five months this year, up 26 percent and 19 percent, respectively, compared to the same period of last year, according to the General Department of Customs and Excises.
The biggest market for Cambodia’s locally-assembled bicycles is the European Union, followed by the US, the UK, and Japan.
In the reviewed period, Cambodia shipped 495,341 bicycles worth 119 million USD to the EU, 223,912 others worth 44 million USD to the US, 125,602 units worth 25 million USD to the UK, and 338 units worth 94,137 USD to Japan.
Last year, Cambodia shipped abroad 418 million USD worth of bicycles, up from 331 million USD in the previous year.
Agro-forestry-fisheries exports down 3.4 percent in first half
Export turnover in agriculture, forestry, and fisheries in the first half of 2020 was estimated at 18.81 billion USD, a year-on-year decline of 3.4 percent.
Import turnover, meanwhile, stood at 14.3 million USD, down 6.6 percent.
The sector therefore posted a trade surplus of 4.5 billion USD, up 339 million USD against the same period last year.
Nguyen Van Viet, head of the Planning Department at the Ministry of Agriculture and Rural Development (MARD), attributed the results to falling demand and prices for key products in the market and declining export turnover to both China and the US.
The group of main agriculture products earned 8.94 billion USD, down 2.7 percent year-on-year, while turnover for livestock products was estimated at 190 million USD, down 19.4 percent. Main fisheries products recorded an estimated 3.56 billion USD in turnover, down 8.6 percent, while main forestry products raked in 5.3 billion USD, up 2.7 percent.
The country earned 1.6 billion USD, 1.7 billion USD, and 384 million USD from exporting coffee, rice, and vegetables in the period, up 1.2 percent, 18 percent, and 19.5 percent, respectively.
China, the US, Japan, and the Republic of Korea remained the largest importers of Vietnamese agriculture, forestry, and fisheries products, with market shares of 24 percent, 22 percent, 8.8 percent, and 6.1 percent, respectively.
To reach its export turnover target of about 41 billion USD in 2020, Viet said the sector will focus on seeking new markets and maintaining traditional markets, while adopting measures to fully tap into opportunities brought about by free trade agreements as well as enhancing trade promotion activities.
MARD will coordinate closely with other ministries, sectors, and localities in addressing difficulties in trade, customs clearance, and quarantine of agricultural products at official border gates, and strictly control non-quota agricultural product import and export activities, especially with China.
Vietnam, Japan seek to expand bilateral trade ties
Minister of Industry and Trade Tran Tuan Anh and Japanese Minister of State for Economic and Fiscal Policy Nishimura Yasutoshi has had a phone discussion on ways to facilitate two-way trade as well as the significance of border trade and the CPTPP to post-epidemic economic recovery in the region and the world.
The two ministers shared concern about the unilateral protectionism and underlined the importance of promoting the role of multi-border trade in economic recovery and development after the COVID-19 pandemic.
They affirmed the significance of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) in the economic development of the world in general and CPTPP members in particular.
In the recent context, the deal will help expand the regional and global supply chains, thus boosting the sustainable development of the economy of member countries, while promoting the application of e-commerce and digital economy in production for rapid post-pandemic recovery, they agreed.
They also concurred to coordinate closely together to make sure the third CPTPP Ministers’ Meeting will be organised online successfully on August 5.
This is expected to contribute to promoting the bilateral cooperation between Vietnam and Japan, while spreading a strong message on the role of the CPTPP to post-pandemic economic recovery and development, and affirming the support for multilateral trade system in line with the regional and global principles and laws.
Concluding the discussion, the two ministers vowed to continue working closely together in the future to expand bilateral coordination, not only within the CPTPP framework but also in other frameworks that both sides are members such as the Regional Comprehensive Economic Partnership (RCEP) and the ASEAN-Japan Free Trade Agreement.
Vietjet joins hands with Facebook to promote Vietnamese tourism
The budget carrier Vietjet has cooperated with Facebook to launch the tourism promotion programme "Immense Vietnam – Fly green with Vietjet" as part of the "Proud Vietnam" project launched by the Ministry of Planning and Investment and Facebook to promote the economy and tourism after COVID-19.
On this occasion, Vietjet offers a super promotion of 50 percent discount on ticket prices on all domestic routes for people and tourists to freely explore the timeless charm of Vietnamese culture, cuisine and people.
Promotional tickets are available during 3 golden days from July 2 to July 4, 2020 on www.vietjetair.com and Vietjet Air mobile app. Enter the code "CHUYENBAYXANH" to enjoy this super promotion when searching for flights departing from August 17 to December 31, 2020, excluding national holidays.
Vietnam has been voted as the top destination in the world to travel after COVID-19 by the famous US travel magazine, Travel Leisure, thanks to its beautiful natural landscape, reasonable price and good pandemic control. Besides the unique culinary culture and hospitable people, Vietnam’s attractive destinations such as Da Lat, Phu Yen, Hanoi, Hue, Hoi An or endless beaches in Da Nang, Nha Trang and Phu Quoc are always in bucket lists of everyone.
Returning to the sky, Vietjet continues to expand the flight network, improve service quality and connect with major partners to create a diversified ecosystem based on modern technology platforms to bring more attractive as well as high quality services and products that meet customer’s demand.
Together with Facebook, Vietjet is responding to the "Vietnamese people travel in Vietnam" programme and "Vietnam Grand Sale 2020" to provide convenient travel opportunities during the peak summer season as well as to introduce the image of Vietnam to people and visitors around the world.
Vietjet is a fully-fledged member of International Air Transport Association (IATA) with the IATA Operational Safety Audit (IOSA) certificate. As Vietnam’s largest private carrier, the airline was awarded the highest ranking for safety with 7 stars in 2018 and 2019 by the world’s only safety and product rating website airlineratings.com and listed as one of the world's 50 best airlines for healthy financing and operations by Airfinance Journal in 2018 and 2019. The airline has also been named as Best Low-Cost Carrier by renowned organizations such as Skytrax, CAPA, Airline Ratings, and many others.