Agricultural and rural tourism has been considered a new direction, bringing fresh air to rural areas in Vietnam, according to experts.

The type of tourism is a new direction in line with the country’s strategy of agricultural economic development towards green agriculture.

According to the Ministry of Agriculture and Rural Development, Vietnam now has more than 1,300 tourist sites under the management of local administrations, about 70% of the sites are in rural areas. They are considered an important resource to promote rural development, create jobs and incomes for people, promote rural economic restructuring, and preserve traditional cultural values.

The northern province of Ha Giang is one of the first localities in Vietnam to develop rural tourism, aiming to improve people's living conditions and develop new-style rural areas. For years, the province has implemented programmes and policies to support people to develop community-based cultural tourism models.

Up to now, electricity is available to all of its cultural and tourist villages, cars can reach villages and the provincial authorities funded more than 16 billion VND (680,500 USD) to build proper toilets at 272 households that offer homestay services.

Localities in the southern province of Ben Tre have also developed rural tourism. In Ben Tre city’s Nhon Thanh commune, homestay services have appeared since 2008. Now, the commune has 11 establishments, which can serve 1,500 visitors per day and provide rooms for up to 250 guests daily.

Vice chairman of the People's Committee of Ben Tre city Nguyen Van Thuong said that agriculture and rural tourism contribute more and more to the economic development of rural communes. It helps create new jobs, boost production and trade. As a result, tourism activities help to improve incomes and quality of life for local people.

The positive impacts of agricultural and rural tourism prove its effectiveness in the development of the household economy in particular, the rural economy, and agriculture in general.

However, according to Minister of Agriculture and Rural Development Le Minh Hoan, many models are still spontaneous, without making differences, and lack linkages. Many tourist destinations have not cooperated with each other yet and not interested in sharing benefits with the community, he said.

Vietnamese firms attend IT, industrial expo in Germany

A delegation of 12 Vietnamese enterprises is taking part in the world leading industrial and IT fair Hannover Messe in Germany in a bid to showcase products, study the market, and form partnerships.

Highlighting environmentally friendly production, this year’s expo attracts some 4,000 exhibitors from 100 countries worldwide. The Vietnamese delegation is sent to the event by the Vietnam Software and IT Services Association (VINASA).

At the Vietnamese space on April 17, VINASA together with the Vietnamese Trade Office in Germany held a networking event themed ‘industrial digital transformation’.

Vu Phuong Thao, director of VINASA's business development services department, said this is the third time association has sent Vietnamese firms to the fair.

According to her, Vietnam’s ICT industry reeled in about 148 billion USD in revenue last year, up 8.7% year-on-year. Turnover of the software and IT services contributed more than 1.97 billion USD to the sum, and is expected to hit 50 billion USD and 150 billion USD in the next 10 and 20 years, respectively.

Do Viet Ha from the trade office said digital transformation is among key cooperation sectors mentioned by the Vietnamese Ministry of Industry and Trade and German Federal Ministry for Economic Affairs and Climate Action in the minutes of the 2nd session of the Vietnam-Germany joint committee on economic cooperation. This, coupled with the EU-Vietnam Free Trade Agreement taking effect, is conducive to the sides’ capitalisation on their collaboration potential in technology, she noted.

Nguyen Manh Hai, the counselor overseeing the Vietnamese Embassy’s investment section, said that Germany is one of the largest ICT markets in the world and the largest software market in Europe with about 100,000 IT companies.

Hai said ample room remains for two-way investment in digital technology and transformation, which is needed to be actively tapped by the Vietnamese and German sides in the near future for improved cooperation and investment in related services.

Moody's keeps VPBank’s ratings unchanged

Moody's Investors Service (Moody's) has maintained the Ba3 ratings and stable outlook for the Vietnam Prosperity Joint Stock Commercial Bank (VPBank).

The rankings have been maintained since July 2022 although the domestic and global financial markets have faced many difficulties and challenges.

In its latest report, Moody’s highly valued the bank’s deal to sell its 15% stake to Japan’s Sumitomo Mitsui Banking Corporation (SMBC), raising its capital safety rate to 19%, the highest among the Vietnamese banks rated by Moody’s.

Moody's said that VPBank's profits are always in the top of the industry, which is considered a strength of the bank in its credit rating profile.

Meanwhile, VPBank's mobilisation capacity and liquidity are considered to be balanced in the current situation, capable of supporting the bank to overcome difficult times when the market is fluctuating.

At the end of 2022, VPBank's charter capital reached over 67 trillion VND (2.85 billion USD), while its capitalised value hit 120 trillion VND, maintaining its position as the private bank with the largest capitalised value in Vietnam.

FPT opens software development centre in China's Nanning city

Leading Vietnamese IT service provider FPT Software has opened a nearshore development centre in Nanning city of China’s Guangxi province to better serve the billion-people market, especially in the automotive industry.

This is FPT's second office in China, after the first launched in Shanghai in 2017. The new centre marked the company’s 65th office in the world.

FPT Software has a solid workforce to address the increasing demand in the automotive sector, with more than 3,800 engineers and IT experts currently supporting the world's leading car manufacturers. Its automotive services and solutions also meet international AUTOSAR standards set by automotive industry giants.

In the next two years, the newly-established centre is expected to have 200 employees and expand the customer base in the field of automotive technology and semiconductor manufacturing in China and globally, and in other fields such as finance - banking, and healthcare.

Located in Liangqing district, FPT Software's new delivery centre is close to many top universities, spanning many majors from business and technology to social studies. This allows FPT Software to work closer with local universities and educational institutions to grow a robust talent pool, tapping the region’s growing IT industry.

Vietnam Airlines to launch second direct route to India next month

Vietnam Airlines will launch direct flights between Hanoi/Ho Chi Minh City and India’s commercial hub, Mumbai, from May 20.

The carrier said it plans to operate four flights per week on the Hanoi-Mumbai route on Tuesdays, Thursdays, Saturdays, and Sundays, and three others on the HCM City-Mumbai route on Mondays, Wednesdays and Fridays, using Airbus A321.

To mark the new services, it will offer preferential fares, with a round-trip ticket, including taxes and fees, costing only 199 USD. The prices are applied for tickets purchased from now until May 26, for flights between May 20 and 26.

In June 2022, Vietnam Airlines opened its first direct route between Vietnam and New Delhi.

Hanoi to host Vietnam National Branding Forum 2023

The Vietnam National Branding Forum 2023 running the theme of "Positioning Vietnam's Green National Brand" and is expected to take place on April 20 in Hanoi, according to details given by the Ministry of Industry and Trade.

The forum is anticipated to focus on issues relating to international experience in building and developing product brands, factors that increase corporate brand value in order to raise the national brand value, as well as brand building in association with the strategy of intellectual property protection both at home and abroad.

The event also represents an annual activity of the National Brand Program and aims to increase both society and the local business community’s awareness about the importance of the management and development of brands in production and investment activities, especially amid international economic integration.

Tourist number in Da Nang recovers to pre-pandemic level

The number of tourists to the central city of Da Nang in the first three months of this year has recovered to the level recorded in the same period of 2019 before the COVID-19 pandemic broke out, according to Cao Tri Dung, Chairman of the Da Nang Tourism Association.

According to the mjunicipal Department of Tourism, in the first quarter of this year, the city received 1.4 million visitors, up 4.6% year on year, including 391,600 foreigners, 62 times higher than that in the same period last year.

The figures were similar to those recorded in the same time of 2019, showing the city’s strong performance in promoting its tourism development and tourism ecosystem, Dung said.

He noted that the staying duration of tourists also increased to 1.66 days per visitor on the average.

Dung attributed the result to the resumption of international air routes to the central city, noting that to date, Da Nang airport has been opened to 16 regular international routes operated by 20 airlines, with more than 280 flights per week carrying about 560,000 passengers.

Alongside, Da Nang has also received a large number of visitors coming by sea. In the first quarter of this year, the city welcomed nine cruise ships with 7,300 passengers.

However, Dung said that in the long run, Da Nang should seek more new tourism products to meet the increasing demands of tourists.

Nguyen Xuan Binh, Vice Director of the city Tourism Department said that in the time to come, the city will organise tourism promotion activities in Thailand, Indonesia and Malaysia, while completing a plan to hold a summer festival in the city.

At the same time, the city will continue to design projects to develop tourism products, while proposing to the municipal People’s Committee a project to promote local cuisine into a tourism product in the 2023-2030 period, and coordinating with the People’s Committee of Son Tra district to build a plan to pilot night-time tourism at Nguyen Van Troi bridge and the park on the foot of the bridge. A pedestrians’ zone will also be organise along Bach Dang-Trang Hung Dao streets, he said.

Ba Ria-Vung Tau to develop more ‘One Commune-One Product’ items

The south-eastern province of Ba Ria-Vung Tau plans to have by 2025 at least 150 products rated no less than three stars under the country’s “One Commune-One Product” programme.

It would prioritise co-operatives and small and medium-sized enterprises for the purpose, with the former accounting for at least 20 per cent of the products, according to its People’s Committee.

It aims to train all officials responsible for implementing the programme at the district and commune levels and enterprises, co-operatives, co-operative groups, and households that register for participation in producing OCOP products.

It also aims to have at least five OCOP items related to community-based tourism and tourism destinations.

Under the OCOP programme, items are rated between one and five stars and include foods, souvenirs, furniture, and herbal medicinal, agricultural and tourism products.

Ha Noi moves to help firms join foreign distribution systems

Ha Noi recently issued a project on promoting Vietnamese businesses to directly participate in foreign distribution networks by 2030.

This project aims to build a close strategic cooperation relationship between Ha Noi's manufacturing and exporting enterprises and foreign distribution networks, on both traditional export and e-commerce channels, towards a stable and sustainable production–export–distribution model.

To accomplish these goals, Ha Noi will direct relevant units, departments, and branches to provide market information for 5,000 businesses, and training for 1,000 to improve their competitiveness and supply capacity to gradually participate in the global value chain; support 300 firms in participating in cross-border e-commerce; and help more than 500 products to be exported directly to foreign distribution networks.

Through many foreign retail groups, Vietnamese goods are now present in supermarkets and shops around the world.

Steel market may recover by end of this year: VSA

Viet Nam's steel market is likely to recover in the third and fourth quarters of this year thanks to augmented efforts to disburse public investment and credit packages for social housing projects, said Doan Danh Tuan, deputy chairman of Viet Nam Steel Association (VSA).

Viet Nam's economic situation, with more positive signs of development, is also expected to support the growth of the steel market, Tuan said.

He thinks 2023 will be a year with many difficulties and challenges for the industrial sector, but Viet Nam's economy is assessed to have more development potential.

Its GDP growth is expected to reach about 6.5 per cent, while global economic growth is forecast at only about 1.5 per cent, and Southeast Asian countries have an average growth rate of about 5 per cent.

The National Assembly has approved an economic recovery support package worth VND350 trillion for 2022-23, of which about VND114 trillion is for infrastructure development, focusing on key projects such as the North-South expressway, Long Thanh airport and large logistics ports.

In addition, in February, the Government approved a credit package of VND120 trillion to develop social housing projects. These factors will lead to strong growth in steel consumption in the third and fourth quarters of this year.

In the long term, according to VSA, Viet Nam's steel demand will continue to grow from 240kg per capita to 290kg per capita in 2030. Steel demand will be concentrated on alloys or high-quality steel.

VSA said crude steel output in the first two months of the year fell 22 per cent year-on-year to 2.9 million tonnes, and consumption decreased by 10 per cent to 3.1 million tonnes.

Crude steel consumption decreased in the first months of this year, but the association said the market has started to improve.

Coffee exports to Indonesia, Russia, and Algeria see triple-digit growth

Vietnam shipped a total of 210,370 tonnes of coffee worth US$482.43 million abroad in March, with exports to Indonesia, Russia, and Algeria witnessing a triple-digit growth, according to figures released by the General Department of Vietnam Customs.      

This figure represents an increase of 5.2% in volume and 10.9% in value compared to February, but a decline of 0.3% in volume and up 1.7% in value against the same period from last year.

In the first quarter of the year, Vietnamese coffee exports reached 552,610 tonnes, worth approximately US$1.23 billion, marking a drop of 5.0% in volume and 5.4% in value over the same period from 2022.

The average export price of Vietnamese coffee in March surged by 5.5% to reach US$2,293 per tonne compared to February and up 2.0% compared to March, 2022.

However, the country’s average coffee export price in the first quarter of the year dropped by 0.3% on-year to US$2,222 per tonne.

During the 4-month period, national coffee exports to most markets recorded an upward trend, with the exception of Belgium, Spain, Japan, and the Netherlands. Most notably, coffee exports to Indonesia, Russia, and Algeria recorded a triple-digit growth rate compared to the first quarter of last year.

Specifically, coffee exports to Russia, Indonesia, and Algeria in the reviewed period increased by more than 76%, 209%, and 126,8% on-year, respectively.

Elsewhere, export turnover to the United States soared by 26.9% to more than US$86 million, while exports to the EU market fell by 8.2% to US$473.7 million on-year.

These figures indicate that EU continue to be the nation’s largest coffee export markets, accounting for nearly 40% of total exports.

Industry insiders predict that the growth rate of global coffee prices will start to slow as high inflation in the EU and interest rates in the US will impact consumer spending, thereby making coffee consumption more uncertain.

However, Vietnamese businesses have been advised to take advantage of factors such as high prices,  Government support, and low export output from leading coffee exporters to boost their own activities.

This will serve to create opportunities for Vietnam to maintain a coffee export turnover of over US$ 4 billion this year.

Vietnamese tea exports to China surge in Q1

The export value of Vietnamese tea to China in the first quarter of the year reached US$2.15 million, up 430% from the same period in 2022, according to the General Department of Vietnam Customs.      

Statistics show throughout the reviewed period the Chinese market saw Vietnam’s largest export growth, rising by 154% in volume and 430% in value year on year.

The main reason behind the sharp rise is that the average export price of Vietnamese tea to China surged by 108% year on year to US$2,930 per tonne.

In contrast, the United States witnessed the largest decrease among Vietnam’s main tea export markets, declining by 44% in volume and 51% in value over the same period from 2022.

Overall, Vietnam exported 21,323 tonnes of tea and earned US$35.21 million in the first quarter, down 7.1% in volume and 4.1% in value year on year.

Pakistan was the largest consumer of Vietnamese tea, importing 7,582 tonnes worth US$13.41 million. It was followed by China’s Taiwan (2,528 tonnes) and Russia (2,010 tonnes).

Beneficiaries of VND120-trillion loan package need to be specified

Deputy Prime Minister Tran Hong Ha has asked the Ministry of Construction to draw up lists of projects, beneficiaries, and lending criteria under a credit package worth VND120,000 billion.

Speaking at a meeting on April 16 with a task force formed to help the real estate sector deal with woes, Ha tasked the State Bank of Vietnam with issuing regulations on debt repayment terms and developing criteria for assessing borrowers’ creditworthiness before March 25, the Vietnam News Agency reported.

The criteria are expected to pave the way for banks to ease credit requirements based on the potential and liquidity of property projects.

So far, the ministry has reviewed obstacles facing over 500 real estate projects in five centrally controlled cities, saying it would work out guidelines for localities and businesses to overcome the difficulties.

The VND120-trillion package is designed to develop homes for the poor and workers and rebuild aging condo blocks.

High occupancy reported on flights to tourist destinations during holidays

The Civil Aviation Authority of Vietnam has requested local carriers to add flights for the upcoming public holiday travel rush given the high occupancy of many flights from HCMC and Hanoi cities to tourist destinations nationwide.

Vietnamese will have a five-day weekend holiday next week as the death anniversary of the Hung Kings falls on Saturday, April 29 and Reunification Day (April 30) on Sunday, hence two following days off as a compensation. Therefore, plus International Labor Day on Monday, May 1, they will have a total of five days off.

The reports of local airlines showed that on April 28 and 29, the total number of available seats was over 41,000 for the routes from Hanoi to tourist cities such as Nha Trang, Danang, Hue, Dalat, Phu Quoc, Tuy Hoa, Quy Nhon and Dong Hoi.

Till now, local airlines have recorded a high occupancy rate on many of their flights. On April 29, Hanoi-Hue flights on the route are full while those on the Hanoi-Tuy Hoa route are 93% full and Hanoi-Dong Hoi and Hanoi-Quy Nhon flights are over 96% occupied.

For flights departing from HCMC, the number of available seats is estimated at 40,000. The percentage of seats occupied on flights from HCMC to Quy Nhon, Phu Quoc and Tuy Hoa is over 80%. Meanwhile, bookings of flights to Nha Trang, Danang, Hue, Dalat, Phu Quoc, Tuy Hoa, Quy Nhon and Dong Hoi have also increased.

Return flights from HCMC and Hanoi City also have high occupancy on May 2 and 3, while over 80% of seats have been booked on flights from the tourist destinations of Phu Quoc, Quy Nhon, Hue and Tuy Hoa to the two big cities.

To meet the increasing travel demand of residents, the Civil Aviation Authority of Vietnam requested local carriers to increase the numbers of flights from Hanoi and HCMC to Phu Quoc, Tuy Hoa, Binh Dinh, Cam Ranh and Con Dao for April 28 and 29, and May 2 and 3.

In a related development, the Ministry of Transport could not approve the proposals made by local carriers on revising down the departure and arrival service fee for this year as the funding for repairing and maintaining airport infrastructure is needed to ensure airport security, according to the ministry.

PM urges financial support for realty businesses

The Prime Minister has told the Ministry of Construction and the State Bank of Vietnam (SBV) to reschedule loans and maintain debt classification to remove regulatory bottlenecks for real estate projects.

The Government Office sent a written document to the Ministry of Construction, the SBV and provincial people’s committees over the prime minister’s guidance on supporting the development of the corporate sector and property businesses.

Prime Minister Pham Minh Chinh assigned the Ministry of Construction to take responsibility for implementing Resolution 33 of the Government on measures to remove hindrances and boost the safe, healthy and sustainable development of the realty market and document 178 of the prime minister on enhancing and helping the sector tackle its woes.

The Ministry of Construction and the SBV were tasked with mapping out detailed plans to eliminate current bottlenecks, reschedule loan repayment and keep debt classification for property projects.

Earlier, real estate and construction businesses sent a petition to the Government seeking permission for banks to reschedule loan repayment and maintain debt classification with a grace period of 24 months for businesses in construction, construction material trading businesses and investors of property projects, given that these businesses are indebted with banks, suppliers, sub-contractors, staff and tax agencies due to investors’ failure to pay.

Solutions adopted to promote sluggish public investment projects

Ho Chi Minh City leaders ought to have solutions to push up sluggish public investment projects.

While overloaded traffic infrastructure, schools and medical facilities are a big bottleneck for the development of Ho Chi Minh City, people are expecting them to be completed soon, but over time, many public investment projects have been sluggish due to various reasons.

Recently, information about public investment has gone viral. Disbursement in the first three months of 2023 only reached 4 percent, causing many people to worry. Because in 2023, Ho Chi Minh City is assigned a public investment capital plan of more than VND70,000 billion, nearly twice the number in 2022 plus the Prime Minister’s direction of the disbursement rate over 95 percent.

In 2022, during the first three months of the year, Ho Chi Minh City did not publish disbursement data. By the end of June 2022, the city’s disbursement rate was only 17 percent and it was 26.1 percent by the end of September.

The city has made concerted efforts, hence, the southern largest city has disbursed 71.3 percent by the end of the public investment disbursement year of the year (January 31, 2023), but it is still among the lowest disbursement group in the country. Chairman of Ho Chi Minh City People's Committee Phan Van Mai accepted responsibility and he himself lowered his emulation ranking.

In fact, even in the medium-term public investment period 2021-2025, scores of public investment projects are behind schedule as well; even some projects cannot be completed for years. According to incomplete statistics on delayed projects, Can Gio district has 315/367 projects, Binh Tan district has 48/65 projects, District 8 has 13/88 projects, and District 6 has 17/73 projects.

By the end of the first quarter of 2023, Ho Chi Minh City still had 25/61 units with zero percent disbursement rate. Five organizations have only disbursed one percent. Worse, the Transportation Works Construction Investment Project Management Authority of Ho Chi Minh City has been allocated nearly VND20,000 billion this year but it has disbursed less than VND200 billion.

Impatient with the slow state of public investment, Dr. Tran Du Lich, a member of the National Monetary and Financial Policy Advisory Council, said that public investment is one of the three driving forces, creating a multiplier effect on the economy. The low disbursement rate means that public investment tools for economic development are skipped.

One of the biggest difficulties in implementing recent public investment projects is the site clearance problem. Several projects have been delayed up to 20 years due to site clearance problems. For instance, the construction of the Tang Long Bridge project in Thu Duc City due to lack of space has to be suspended from September 2019 to the present.

Local inhabitants complained this road is jammed every day at rush hour in the morning and in the afternoon, adding that if there is a traffic accident, the traffic jam lasts for hours. They also moaned about the dust and noise from the temporary bridge which has significantly impacted their's lives.

National railway investment requiring foreign push

Foreign investors are being urged to explore funding railway lines linking seaports as part of the country’s railway development plan – despite high costs, few successful projects, and a lengthy period to see returns.

East Japan Railway Company (JR East), Japan’s largest rail operator, has expressed interest to the Ministry of Transport (MoT) about upgrading and renovating the Hanoi-Haiphong railway line, as well as building the route to Haiphong Port.

Since the railway network master plan for the decade was approved in 2021, Japanese investors have been paying attention.

Under the plan, the Hanoi-Haiphong route will be upgraded. The long railway to Haiphong port connecting with Lach Huyen port and Dinh Vu port, worth about $1.5 billion, has also been included in the list of projects seeking foreign investment.

In June 2022, a JR East delegation took part in the first working session with the MoT and Vietnam Railway Corporation, and made a field trip to the Hanoi-Haiphong railway.

The Hanoi-Haiphong railway will be 102km long and will be developed as a double-track railway. The Haiphong side connects the railway to Dinh Vu, Nam Do Son, and Lach Huyen ports. The Lao Cai side links the railway with Chinese railways to exploit intermodal and transit transport.

The upgrade for the existing railway will be conducted after 2025. The single-track railway gauge of 1,000mm remains unchanged with both passenger and freight trains. Meanwhile, the new 1,435mm railway line will specialise in freight trains only.

In addition, the MoT is also evaluating the feasibility of restoring Thap Cham-Dalat railway under the public-private partnership (PPP) model by Bach Dang Hotel Complex Trading-Service. The railway passes through Phan Rang-Thap Cham city of the south-central province of Ninh Thuan and the Central Highlands city of Dalat, with a length of 83.5km and passing 16 stations.

However, it will not be easy to lure private and international investment in transport. After nearly a decade of development with private engagement in railway infrastructure, only Yen Vien station, developed under a railway infrastructure lease, has been truly successful. Other projects have been suspended despite reported investor interest.

JR East is not the first foreign investor interested in railway infrastructure. In 2018, South Korea’s Lotte E&C sought approval to invest in upgrading Yen Vien-Lao Cai railway, and building a railway connecting Lao Cai and Ha Khau through PPP. Lotte E&C proposed the development of the project under a build-lease-transfer contract, across two components. However, the project has seen no signs of development despite support from the MoT.

According to Duong Hong Anh, deputy director of the Vietnam Railway Administration, the biggest barrier to rail funding is that projects require huge capital but generate low profits. This, coupled with a lack of guidance on incentives, makes it hard to lure investors.

To implement the railway network master plan for 2021-2030, the MoT has proposed increasing public investment capital in the medium term. Priority is to be given to investment in several large railroad projects to reduce logistics costs in the next few years. The MoT is also currently completing a pre-feasibility study for building a North-South high-speed railway.

Mekong delta embarks on foundation building for organic agriculture

The Mekong Delta, Vietnam's vital agricultural and aquaculture hub, is witnessing the coming-into-being of various organic farming models, laying a basis for future development of the sector.

In Tam Nong, a large rice production area of the region, an organic farming model that combines rice cultivation with fish and duck rearing has proved suitable to the local conditions. The fish is raised in organic paddy fields, and the ducks released to feed on vermin around the area.   

Minister of Agriculture and Rural Development Le Minh Hoan said the model follows the natural cycle, reduces emissions, and increases incomes in a limited area of arable land.

Hoan noted that such a feasible method should be further studied for larger application in areas with similar conditions.

Meanwhile, the farming sector in Can Tho city has been collaborating with businesses to launch organic production models for rice and fruit, with high-tech models and the VietGap (Vietnamese Good Agricultural Practices) standard widely applied. After thorough assessment, the city has planned to have 4,000ha of paddies, 1,3000ha of fruit trees, and 150ha of vegetables following organic farming.

According to the minister, perceptions of the agricultural economy have improved significantly. Enterprises, cooperatives, and farmers are aware of the need to reach higher-level export markets for better value and profit.

Such improvement has helped form material areas of a strong connection between businesses and farmers, Hoan said.   

Statistics showed that the total agricultural land for organic farming in the country reached some 174,000ha in 2022, an increase of 47% over 2016, putting Vietnam in the list of the top 10 countries with the largest organic agricultural land in Asia. The nation has set a target of increasing its total organic land area to 2.5-3% of the agricultural land area by 2030.

Organic farm produce has brought home 335 million USD in annual export value and is present in over 180 countries and territories. Europe is the main importer of those products from Vietnam.

High cost of materials puts pressure on Vietnam’s construction industry

Despite expectations that the demand for iron and steel will rise due to the government's efforts to reduce supply by disbursing public investment, removing funding for key projects or focusing on social housing projects, the cost of construction materials remains stubbornly high.

According to contractors and investors in Hanoi, while the price of cement has stabilised, other essential building materials such as steel and construction sand continue to increase in price.

This trend has made it difficult for businesses to accept contracts for construction projects that require large amounts of steel, as they fear heavy losses if the price of steel continues to rise.

As a result, many construction projects remain unfinished, as businesses are unwilling to take on the financial risk of completing the work.

A director of an enterprise specialising in the construction of bridges and roads said that every time a supplier sent a new quote, it was like "sitting on a fire".

Since the beginning of this year, the price of CB240 coil and D10 CB300 reinforcing bars after at least five adjustments has reached approximately 16 million VND (678 USD) per tonne. Hoa Phat steel bar prices in the south rose by 200,000 VND per tonne on March 6, and it is expected to be applied in the northern market too.

The price of construction sand after the Lunar New Year has soared because many agent owners reported scarcity due to decreasing supply.

Construction enterprises, which already had difficulty in maintaining their cash flow, high borrowing costs and many debts from the declining real estate market, are now gradually "getting hit" by fluctuations in the price of building materials.

Some experts predicted that if this situation persists, the number of companies with sufficient capacity and quality in the construction industry would be counted on one hand in the next five years.

Data from the business registration authority shows that the whole country had 51,401 enterprises withdrawing from the market in the first two months of this year, a year-on-year increase of 14.5%.

Among 17 business lines, construction and real estate businesses have a very high number of enterprises suspending business with more than 7,180 enterprises.

The construction industry has 5,525 enterprises registered to suspend their business, up 22% year-on-year.

Similarly, 1,660 enterprises in the real estate industry registered to suspend their business in the past two months, up 57%.

Source: VNA/SGT/VNS/VOV/Dtinews/SGGP/VGP/Hanoitimes