Apartment absorption was relatively positive in Hanoi in the first quarter but weaker in Ho Chi Minh City compared to the same period last year while supply remains limited in both metropolises, reported real estate services and investment company CBRE.

New apartment supply in Hanoi and HCM City improved during the last quarter in comparison with the same period of 2023 but is yet to fully recover, General Director of CBRE Vietnam Dang Phuong Hang told a press meeting on April 9.

Housing supply remains limited in both key markets since the beginning of this year.

The majority of new supply in Hanoi came from high-end apartment projects in western areas. Over 2,300 apartments and 30 units of low-rise housing were opened for sale in Q1. The number of new apartments for sale in the capital city increased 11% from a year earlier but was still lower than the 3,000 - 4,000 units for sale recorded in Q1 of 2021 and 2022.

In HCM City, only about 500 apartments were offered to the market during the first three months, and most of them came from following phases of the projects already opened for sale in 2023. This is the lowest quarterly figure in about 15 years and equivalent to only 17% of the number seen in Q1 last year, according to CBRE.

Nguyen Hoai An, Senior Director for the research and consulting division at CBRE Vietnam, pointed out positive apartment absorption in Hanoi though most of the new supply opened for sale in the later part of Q1. More than 2,000 apartments were sold during January - March, equivalent to the same period last year.

Meanwhile, limited supply of apartments led to lower absorption in HCM City compared to a year earlier as well as the previous quarter. Over 600 apartments were sold in this city during Q1, dropping 74% from Q4 of 2023.

CBRE forecast Hanoi will record over 12,000 apartments opened for sale in 2024, rising nearly 20% from last year. As most of the new supply will come from the high-end segment, primary prices are likely to stay high or grow 10% on the yearly basis.

Supply in HCM City is predicted to remain low this year with only more than 8,000 apartments while primary prices may go up about 3% from 2023, CBRE forecast./.

Electric stocks in spotlight as peak season approaches

Investment flows are expected to return to stocks in the electricity sector as demand for electricity is going to soar in the summer, said experts.

Capital inflows reached or neared their peak levels in industries such as banking, securities, steel, food, retail, software, warehousing and logistic maintenance since the beginning of this year, according to FiinGroup’s statistics. In contrast, the capital flow in the electricity sector has experienced a decline.

Stocks in the electricity sector have seemingly been overlooked by investors recently. This is because of their defensive nature, relatively low and stable return on investment, which makes them less appealing compared to other industries during a market uptrend.

However, there are expectations these stocks will gain momentum and attract more attention in the second quarter.

The stocks in the electricity sector have gained momentum since April 2 as several power generation companies such as PetroVietnam Power Corporation (POW), Bamboo Capital Group JSC (BCG), PetroVietnam Power Nhơn Trạch 2 JSC (NT2), Gia Lai Electricity JSC (GEG) and construction companies like PC1 Group JSC (PC1) and Power Engineering Consulting JSC 2 (TV2) witnessed higher prices and rising liquidity.

The gains were sparked by the approval of the Power Development Plan VIII on April 1 by Deputy Prime Minister Trần Hồng Hà. The plan aims to transition from conventional power sources like coal fueled electricity to cleaner alternatives such as LNG, onshore and offshore wind power, and solar power.

A few days ago, Vietnam Electricity (EVN) also passed a new mechanism to adjust retail electricity prices every three months instead of every six months as before.

This change is expected to allow the company to potentially increase electricity prices by around 5 per cent until the end of the year, contributing to the short-term improvement of its financial health.

MB Securities Company believes that this new mechanism will positively impact the value chain of the electricity industry, particularly as EVN plays a crucial role as the main buyer and seller of electricity.

The increase in electricity prices will provide EVN with the capability to fulfil payment obligations to power generation plants.

As a result, thermal power plants, such as POW, Power Generation 3 (PGV), NT2 and Quảng Ninh Thermal Power (QTP), are experiencing a notable rise in accounts receivable for electricity and the higher ratio of accounts receivable to total assets is expected to ease their financial pressure.

The electricity sector is currently entering its peak and most challenging period of the year in terms of power supply due to the dry season.

In March, the total electricity production across the entire system reached 25.7 billion kWh, marking a 9.8 per cent increase from last year. This brings the total electricity production for the first quarter of this year to 69.4 billion kWh, up 11.8 per cent.

EVN anticipates an average daily electricity consumption of 865.7 million kWh in April, reflecting a 10 per cent rise year-on-year.

These developments, coupled with the approval of the Power Development Plan VIII and the implementation of the new electricity price adjustment mechanism, are positive factors for the electricity sector after a quiet period.

The cash flow in the stock market tends to adjust after a period of reaching its peak, forming intermediate or long-term bottoms within a span of 3-6 months.

Đỗ Hồng Vân, head of Data Analysis at FiinGroup, said recent leading sectors in the market, including banking, securities and steel, are seeing money flow peaking and signs of declining. Meanwhile, the electricity industry is maintaining a low proportion of trading value, almost resembling the bottom level of the past year.

With the market's cyclical nature of cash flow and the positive signals evolving the power industry, the market’s attention is going to shift to electric stocks, Vân added. 

VN insurance premium revenue continued to decline in Q1 2024

Việt Nam’s insurance premium revenue in the first quarter of 2024 continued to decrease by 4.3 per cent compared to the same period last year to more than VNĐ53.29 trillion, the General Statistics Office reported.

Of the total revenue, the life insurance sector represented VNĐ33.74 trillion, down 10.9 per cent; and the non-life insurance sector contributed to more than VNĐ19.55 trillion, up 9.8 per cent.

With the move, insurance premium revenue has declined for the fourth consecutive quarter. However, the rate of decrease in the first quarter of 2024 slowed compared to previous quarters.

At the same time, the non-life insurance sector has continued to maintain steady growth.

Insurance benefits payout in the first quarter of 2024 reached more than VNĐ20.98 trillion, an increase of 20.5 per cent over the same period in 2023.

Insurance companies reinvested nearly VNĐ779.12 trillion into the economy in the period, up 10.4 per cent over the same period in 2023.

By the end of the first quarter, total assets of insurance companies were estimated at nearly VNĐ932.87 trillion, an increase of 10.2 per cent.

The insurance sector recorded double-digit premium revenue growth in about ten consecutive years before 2023. However, insurance premium revenue has declined since 2023 following an insurance crisis, during which consumer trust was said to be at an all-time low after numerous scandals broke out. The crisis has negatively impacted the entire insurance industry and has forced management authorities to take actions to rectify the sector.

Since the crisis, regulatory agencies and insurance companies have taken measures to reassess the situation, considering it an opportunity to cleanse and readjust the market after a period of rapid growth. The focus is on developing the market sustainably, transparently and safely.

Solutions have been proposed by the Ministry of Finance’s Insurance Supervisory Authority (ISA) to enhance market transparency and safeguard the rights of insurance participants.

According to Phạm Thu Phương, deputy director of the ISA, the department completed the inspection of five insurance companies, including three life insurance companies and two non-life insurance companies, in 2023.

The inspections found that insurance companies mainly violated regulations on supervising and managing insurance agents. Accounting of insurance companies were also still negligent, Phương said, adding the ISA carefully reviewed the violations and imposed fines.

In 2024, according to the approved plan, the ISA will inspect six insurance companies. It will inspect the implementation of insurance sales through credit institutions and foreign bank branches for two life insurance companies Mirae Asset Prévoir Life Insurance Co., Ltd and Cathay Life Insurance Vietnam Co., Ltd. 

SMEs offered loans at preferential rates of 1.2-4.4%

To create additional capital mobilisation channels for small- and medium-sized enterprises (SMEs), Vietnam’s Small- and Medium-sized Enterprise Development Fund under the Ministry of Planning and Investment is offering SMEs loans at preferential interest rates of 1.2-4.4% per year.

Specifically, with the aid from the fund, SMEs can enjoy preferential lending interest rates from 1.2% per year for short-term working capital loans and 4.4% per year for medium- and long-term loans. The maximum loan period is seven years while interest grace period is two years with maximum loan amount of 150 billion VND and minimum loan amount of 300 million VND.

For collective economic organisations, such as production cooperatives, a fixed loan interest rate of 5.13% per year will be applied, with a maximum loan term of five years and a maximum loan limit of 100 billion VND.

SMEs said it is a practical and meaningful policy to support them with financial resources to start a business or expand production scale.

According to Hoang Thi Thanh Thanh, Director of the Thai Thanh Agricultural Cooperative, as a newly established SME, the policy is very useful for her cooperative which needs capital to develop more products and expand its distribution system to promote the consumption of goods, increase income for cooperative members and create more jobs for workers. Previously, it was not easy for the cooperative to access bank loans of incentive interest rate programmes.

SMEs always had to take detours and ask for help from acquaintances, both costly and time-consuming. Despite having capital demand, many SMEs were hesitant to borrow because they were worried about not finding the right addresses, Thanh said.

According to Phan Thanh Ha, Director of the fund, currently, the fund has signed framework contracts with six commercial banks including BIDV, Bac A Bank, HD Bank, Military Bank, SHB and Sacombank, to carry out indirect lending.

Pursuant to Government Decree 39/2019/ND-CP on the organisation and operation of the Small and Medium Enterprise Development Fund, and indirect lending regulations, SMEs will be responsible for submitting loan applications at bank transaction offices or by post. Banks will be responsible for receiving loan applications from SMEs before evaluating and making lending decisions for qualified SMEs, Ha said.

The fund decided to transfer capital to banks to provide indirect loans for 39 projects with a total amount of 682 billion VND by the end of 2023, which shows many SMEs accessed aid from the fund, Ha said.

The Small and Medium Enterprise Development Fund, established in 2019, is an off-budget financial fund and operates for non-profit purposes. The fund's purpose is to improve the competitiveness of SMEs, contribute to increasing income and creating jobs for workers. At the same time, it is expected to improve the efficiency of State capital management in supporting SMEs./.

Fertilizer exports in Q1 enjoy strong growth

Vietnam shipped 499,786 tonnes of fertilizer abroad during the first quarter of the year for more than US$207 million, marking a year-on-year increase of 23.3% in volume and 13.1% in value, as reported by the General Department of Vietnam Customs.
 
March alone witnessed the export volume reach 148,792 tonnes of all kinds, down 13.4%, with a turnover of over US$62 million,  a decrease of 13.5% over that of February.

During the January to March period this year, the average export price of fertilizer reached US$415 per tonne, falling by 12% against the same period from last year.

The major market for Vietnamese fertilizers in the reviewed period was Cambodia, which bought 103,510 tonnes worth US$42 million, down 1% in volume and 10% in value compared to 2023.

This was followed by the Republic of Korea with 68,947 tonnes and a value of US$28.9 million, rising by 55% and 72% on-year. The Philippines came third by purchasing 36,846 tonnes at a cost of US$17 million, increasing sharply by 306% and 197% on-year, respectively.

The fourth position went to Malaysia which spent US$10.9 million to import 32,111 tonnes of Vietnamese fertilizer.

Other popular markets for the product include Japan, Taiwan (China), Thailand, and Laos.

Supply capacity expected to increase on flights from Hanoi, HCM City on upcoming holidays

The Civil Aviation Authority of Vietnam (CAAV) has required airlines to consider increasing supply capacity on routes from Hanoi and Ho Chi Minh City to destinations with big tourism demand such as Da Nang, Phu Quoc, Tuy Hoa, Binh Dinh, and Cam Ranh during the Liberation of the South and National Reunification Day (April 30) and May Day (May 1) holidays.

The CAAV will also consider raising coordination parameters at Hanoi’s Noi Bai International Airport from 37 flights to 42 flights per hour in the daytime right in April; and at Ho Chi Minh City’s Tan Son Nhat International Airport on some peak days during the upcoming holidays from 44 flights to 46 flights per hour in the daytime to serve people's increasing travel demand.

Currently, airlines are developing plans to increase supply capacity on domestic routes during the holidays, of which Vietnam Airlines intends to add about 30-40 flights a day and VietJet Air around 80 flights a day.

The CAAV also requested airlines to seriously list, announce, and publicise ticket prices as regulated, and advise passengers to buy tickets on their official channels and get receipts and invoices to protect their interests./.

Vietjet announces direct route between HCM City, China’s Xi'an

Vietnam’s new-age carrier Vietjet celebrated the 10th anniversary of its first flight to China (2014-2024) and announced a direct route between Ho Chi Minh City and China’s Xi'an at a policy and law forum held in Shanghai city on April 10.

National Assembly (NA) Chairman Vuong Dinh Hue, who is paying an official visit to China, and other leaders of the two countries attended the event.

Deputy Prime Minister Tran Luu Quang congratulated Vietjet on its operational achievements, and noted his belief that the carrier will launch more flights between the two countries, thus helping promote the bilateral trade and mutual understanding and support, and deepen the Vietnam-China comprehensive strategic cooperative partnership.

From this summer, Vietjet will operate direct flights between HCM City and the ancient capital of Xi'an, with four return flights per week.

Binh Thuan registers only seaworthy vessels among its offshore fleet

The south-central coastal province of Binh Thuan has become the first locality in the country where all vessels have been certified seaworthy, according to Huynh Quang Huy, Director of provincial Fisheries Sub-Department.

By the end of March, Binh Thuan has granted temporary registration for more than 2,380 vessels, he said. This is one of the province’s efforts to carry out the European Commission’s recommendations about illegal, unreported and unregulated (IUU) fishing prevention and control, towards the goal of having the EC's “yellow card” warning lifted.

Huy said that this move will facilitate the control of exploitation of aquatic resources and strictly handle fishing violations, adding that fishermen benefit from a well-inspected fishery industry.

Earlier, as authorised by the local administration, the provincial Department of Agriculture and Rural Development in coordination with the provincial Border Guard Command and relevant agencies to make a list of vessels with a length of at least 6m that have not been registered in the locality.

It was found that Binh Thuan province had 2,380 such vessels, mainly in localities such as Tuy Phong, Bac Binh, Phan Thiet city, Ham Thuan Nam, La Gi, Ham Tan and Phu Quy districts. They are fishing vessels that have not been re-registered in line with the provisions of the 2017 Fisheries Law or those that have changed owners but have not yet carried out transfer procedures as required.

The number of "3 Nos" vessels (no registration, no re-registration, no license) operating in the coastal areas is quite large. But they don’t meet the conditions and procedures for official registration, leading to difficulties in licensing aquatic resources exploitation. Thus, the local administration has granted licences to ensure that all fishing vessels in the province operate in accordance with law./.

Infrastructure focus sets stage for real estate bonanza

Although infrastructure development in Vietnam’s biggest cities is gradually helping to bolster real estate in neighbouring areas and push up prices, investors are advised to remain cautious and take local livelihoods into account.

Located in Thu Duc of Ho Chi Minh City, the Dong Tang Long project was once expected to be a model urban area, but it has remained unused for many years and is now a series of abandoned and degraded villas.

Twenty kilometres from the heart of Ho Chi Minh City, it was established in 2005 by Housing and Urban Development Investment Corporation. The project was expected to be increase its land price after nearby Nguyen Duy Trinh street was listed in the expanded routes of the city. However, plans to expand the route were delayed and no updated on the matter have been forthcoming.

The project was priced at $2,700-2,900 per square metre of land and from $333,000-750,000 for a townhouse, as well as up to $1.6 million per villa, depending on location. Many of those were completed, but few residents live there. Villas have been left uninhabited and vacant for many years, causing deterioration and the areas overgrown with grass.

According to Nguyen Nam, a resident of the project, there are few people living there as it is far from the centre with few amenities and leisure services. “It is too desolated and there are no services. People owning a house here would probably have other properties in the city centre, so they do not live here,” Nam said.

In Hanoi, Lideco urban area located in Hoai Duc district was started in 2007, but is still unfinished. Most of the villas have been only partially completed and left abandoned and uninhabited.

The project includes around 650 villas and over 130 town houses. It should have completed construction in 2013, but a lack of effective infrastructure has been deemed the reason for the standstill.

A report on infrastructure real estate released by the Vietnam Institute for Real Estate Research (VIRES) last week evaluates the essential role of parallel development of real estate and transport infrastructure projects.

The VIRES believes that in the process of urbanisation, transport infrastructure projects play a leading role in development thanks to convenient connectivity and awakening of potential localities.

The formation of a residential area or a large urban area starts with roads and traffic. The promotion of infrastructure deployment encourages population movement, land transfer, and the development of new areas. This creates motivation for formation of real estate projects to meet new local development needs, thereby attracting investment.

“Transport infrastructure is the backbone of the real estate market in each certain area and is also a key and fundamental factor in bringing added value to real estate,” it said.

Peter Meyer, vice chairman of Lodgis Hospitality, said that the government had invested into the infrastructure system in 2024 with a range of projects and investment in infrastructure crucial for economic growth.

“The Vietnamese government is focusing on roads, public transport, and other things that are fundamental as they relate directly to properties. Efficient functioning airports are also crucial to all of our destinations,” said Meyer.

Michael Piro, COO of Indochina Capital, said that the accessibility to project sites was a crucial factor in deciding the efficiency of any given project.

“Infrastructure is a key factor for project’s development and real estate developers are finding projects where infrastructure development is happening, but they are facing challenges when land price around the world is rocketing and becoming too expensive for investment,” Piro said.

Real estate projects adjacent to airports, ports, or located in areas with ring roads and highways running through them always have higher value and the ability to increase in price compared to other real estate projects.

Location is a top factor determining the value of real estate. The VIRES cited the example of the Van Don-Mong Cai Expressway opening in September 2022, which helped reduce travel time from Hanoi to Mong Cai city from seven to three hours, creating a boost for the local market.

A VIRES survey shows that real estate prices in Mong Cai have increased by about 30-40 per cent compared before the expressway planning. To benefit from the route, industrial and commercial real estate projects, smart urban areas, and resorts in Mong Cai are being promoted for investment and development.

In some localities with expressways running through them, such as Cau Gie-Ninh Binh, land prices are also increasing.

According to the Ho Chi Minh City Real Estate Association, dozens of projects along Metro Line 1 have increased sharply in price compared to those in 2018.

Kiet Vo, national head of Residential Project Marketing at CBRE Vietnam, said the average price in some projects located along the line have increased from 50 to 150 per cent over the last eight years.

“Many projects on this route have increased in price rapidly, and many others are in the pipeline. The apartment market in areas near the metro line still has a lot of potential for price increases, attracting business and commercial units to set up retail stores, as well as increasing parallel development of office projects,” said Vo.

A study by the Environment for Development in Vietnam has shown that the areas within a radius from 1-3 kilometres from a metro station have a 15 per cent increase in real estate value, and 5 per cent for 3-5 km. With new transportation infrastructure projects being implemented to connect with Ring Road 3, real estate projects in Hanoi have recorded high price increases, especially in the past five years.

From a positive perspective, infrastructure projects create development space and investment opportunities for the real estate market in neighbouring areas.

However, according to the VIRES, after the news of an infrastructure project upgrading is leaked, land prices start rising rapidly.

Therefore, planning infrastructure projects is a key factor that can easily be exploited by speculators to create a real estate bubble, it said.

Real estate speculators are constantly looking for information on planning infrastructure projects to stay one step ahead, buying land and other real estate located in or near the planned infrastructure areas to enjoy the increased price after the infrastructure is complete.

Vo Hong Thang, deputy director of Research and Development at DKRA Vietnam, said that transport infrastructure positively impacted the real estate market. However, in the current difficult times, investors who want to be successful must pay attention to a number of factors.

“The first is to have strong finances, avoid using loans, and to carefully review the project’s legality, and review local planning,” Thang said. “Another important factor that cannot be ignored when investing in infrastructure is people’s livelihood. Real estate values ​​can increase in areas that form urban areas, with residential areas with full amenities such as markets, hospitals, schools, and parks. Just being near a transport infrastructure system alone is not enough.”

In a volatile period, investors need to determine a medium- and long-term investment strategy to ensure expected profits because large transportation infrastructure projects often have long-term falling points, so it is necessary to increase capital, especially equity capital, Thang added.

“Investors need to determine a medium and long-term investment strategy, thereby ensuring expected profits because large transportation infrastructure projects often have long, complicated timelines. To minimise risks, investors must pay attention to preparing sustainable and stable financial flows for 3-5 years,” Thang said.

CPTPP gains to be built on expansion

Five years into deployment of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, many other economies are seeking to join the bloc – which in turn could help Vietnam expand its trade and investment.

The deal (CPTPP) has created a system of rotating chairmanship based on the order of the agreement’s ratification. In 2024, Canada is chairing the CPTPP Commission, working to advance the agreement in a manner that reflects the interests of partners, businesses, civil society, and the public.

One of the key priorities for Canada is to develop an effective path forward on accession. This priority will be guided by the Auckland Principles, which state that the CPTPP is open to accession by any economy that is willing and able to meet its high standards, has a demonstrated history of compliance with their existing trade commitments, and can achieve the consensus of members.

For example, despite being formally signed in 2023, the United Kingdom’s entry into the CPTPP only takes effect this year, following the completion of domestic legal processes by the British parliament. Joining is considered the UK’s most significant trade agreement since its departure from the European Union.

At last week’s meeting between Vietnamese Deputy Minister of Foreign Affairs Le Thi Thu Hang and UK Permanent Under-Secretary of the Foreign Office, Sir Philip Barton, both sides agreed to closely cooperate with each other to well make the most of the UK-Vietnam Free Trade Agreement and boost cooperation in the sectors of finance-banking, education and training, science and technology, and maritime economy, while also deepening trade and investment.

Emily Hamblin, British consul general in Ho Chi Minh City, told VIR that the CPTPP offers the UK and Vietnam an expanded platform for trade liberalisation, market access, and regulatory harmonisation. Its provisions facilitate streamlined customs procedures, accelerated tariff reductions and enhanced intellectual property rights.

“All of this contributes to the creation of a conducive environment for businesses to thrive,” Hamblin said. “By joining this dynamic and diverse trade bloc, the UK has gained access to a market of over 500 million people. This not only strengthens our trade links with Vietnam but also broadens the horizons for British businesses, enabling them to tap into new markets and forge supply chains across the Asia-Pacific region.”

In 2023, total trade in goods between the UK and Vietnam reached $5.92 billion, including Vietnam’s exports of $6.42 billion, up 88.5 per cent on-year; and imports of $799 million, up 87.6 per cent on-year.

Cumulatively, as of March 20, the UK had more than 560 valid projects in Vietnam, registered at $6.3 billion.

The CPTPP is a free trade agreement in-force between Vietnam and 10 other countries in the Indo-Pacific region, including Australia, Canada, Brunei, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, and Singapore.

According to the Ministry of Foreign Affairs, Vietnam is expected to see many opportunities in expanding trade and investment cooperation with potential new members of the CPTPP. Taking effect for Vietnam in January 2019, it is considered one of the best solutions as it offers flexible mechanisms for dealing with investment obstructions as well as trade facilitation.

China, Ecuador, South Korea, Thailand, the Philippines, Columbia, Uruguay, and others have all expressed interest in joining the CPTPP, which currently represents a free trade area worth about $11 trillion in aggregate GDP.

In 2022, South Korea expressed its desire to join, as it seeks to diversify its export portfolio amid heightened economic uncertainty. Currently, this nation has yet to submit its official application, pending completion of its domestic procedure requirements. It conducted countless informal and formal consultations with every member country at every level of the government hierarchy.

Accession would help expand trade and investment for South Korea, raising its GDP by 0.33-0.35 per cent annually, the state-run Korea Institute for International Economic Policy estimated.

Meanwhile, the Thai government has continuously expressed interest in joining the 11-member mega trade bloc. Thailand considers the agreement an effective tool for recovering and developing its economy, and making industries such as electronics and agriculture more competitive against rivals such as Vietnam and Malaysia, which are both members.

Nguyen Lan Phuong from law firm Baker McKenzie Vietnam told VIR that the expanded CPTPP will benefit Vietnam significantly.

“It is a modern and forward-looking trade agreement, with cutting-edge provisions in digital trade and e-commerce. In the technology-driven era, collaboration in technological advancements is imperative for sustained and resilient economic growth, and will open up new avenues for cooperation in emerging sectors,” Phuong said.

“The Vietnamese government has been revising regulations with a view to taking full advantage of its benefits and its enormous market, such as the data privacy protection decree and social media tax administration regulations. An expanded CPTPP is good news for supply chains in Vietnam,” Phuong added.

On the downstream side, she continued, Vietnam origin goods already enjoy a cost advantage over competitor non-agreement goods via lower import tariff rates and streamlined trade procedures in the existing member markets of Australia, Canada, Japan, Mexico, New Zealand, Peru, and Singapore. Adding new members will expand consumer markets for Vietnam origin goods.

“An expanded CPTPP would allow manufacturers to source materials from additional markets, without forfeiting the benefits offered. Accordingly, expansion will allow for more dynamic and agile supply chains within the trading block,” Phuong said.