Construction enterprises are bullish about the sector’s prospect in 2024, a recent survey by the Vietnam Report Joint Stock Company revealed.

Accordingly, 52.5% of the surveyed expect positive changes, 36.9% forecast the sector will remain unchanged as compared to 2023, while 10.5% believe the market could grow gloomier this year.

Although the construction market may not carve out robust results in 2024, enterprises expressed their hope that 2024 could be “the first brick” that lays foundation for a recovery and new development circle.

Vietnam Report General Director Vu Dang Vinh said that enterprises expect their business will be backed by stable macroeconomy, ensured major balances, and brighter realty market with legal bottlenecks to be removed and better market confidence.

The State Bank of Vietnam has set a credit growth target of 15% this year, creating favourable conditions for credit institutions to provide sufficient capital for the market in a timely fashion, Vinh stressed, adding interest rates have cooled down, easing burden for construction firms.

Vinh described public investment as a pillar and locomotive for the Vietnamese economy at the moment and in both mid- and long-terms, saying investment in transport infrastructure development has been accelerated, and disbursement of public capital will be at its peak this year for key transport projects.

Some 677.3 trillion VND (29.29 billion USD) is set aside for public investment this year, and 95% of which must be disbursed under a Prime Minister’s decision. Of the total amount, up to 422 trillion VND is for transport infrastructure construction, which is expected to prop up the construction sector.

According to Vinh, the domestic construction market is expected to benefit from the FDI wave, with 36.6 billion USD funneled into the country in 2023, a year-on-year surge of 32.1% despite global economic uncertainties. Around 23.18 billion USD was disbursed in the year, up 3.5% year-on-year, and marking a record high thus far.

He said the strong foreign capital inflow has created a more exciting prospect for 2024 as Vietnam’s geopolitical and production position have been consolidated.

During January – February this year, 2.8 billion USD in foreign capital was disbursed, the highest figure recorded for the same time in the past five years, opening up numerous opportunities for the industrial construction sector.

Besides, enterprises’ positive sentiment also comes from their intrinsic strength with effective financial management capacity, successful application of digital transformation into management and operation, high-quality human resources, and improved prestige and brands, he added./.

PM pushes for faster progress of 500kW circuit-3 transmission line

Prime Minister Pham Minh Chinh chaired a teleconference with ministries, agencies, localities and units on April 1 to review the progress of the 500kV circuit-3 power transmission line linking Quang Trach in the central province of Quang Binh and Pho Noi in the northern province of Hung Yen.

The nearly 519km-long line has an investment capital of over 22.35 trillion VND (929 million USD), comprising four sections, including Quang Trach - Quynh Luu, Quynh Luu - Thanh Hoa, Thanh Hoa - Nam Dinh 1 thermal power plant, and Nam Dinh 1 thermal power plant - Pho Noi.

Construction of the transmission line began in October 2023 for some sections and January 2024 for others, with a goal of completion and operation in June 2024.

Speaking at the event, PM Chinh hailed ministries and agencies, especially the Ministry of Industry and Trade, for their active role in regularly overseeing and accelerating the project.

They were asked to continue working closely together to overcome any hurdles and maintain the project's schedule.

The PM directed relevant authorities to finalise compensation policies for affected residents by April 10. He also set deadlines for substantial completion of project items by June 20 and full operation no later than June 30./.

Vietnam, Indonesia similarities facilitate trade, agro-fishery cooperation

The Vietnamese and Indonesian economies share many similarities, conducive to cooperation in trade, agriculture, and fisheries promotion, said experts at a symposium held in Ho Chi Minh City on April 1.

The event was co-organised by the municipal Investment and Trade Promotion Center (ITPC) and the Consulate General of Indonesia in the southern economic hub.

Ho Thi Quyen, Deputy Director of the ITPC, said Indonesia is Vietnam’s third-largest trading partner in the ASEAN region and potential import market.

According to statistics from the General Department of Vietnam Customs, the countries’ trade reached nearly 14 billion USD in 2023, with Vietnam's export value to Indonesia exceeding 5 billion USD. Rice was the largest contributor to the export turnover with 640 million USD from 1.16 million tonnes.

Quyen added that in addition to rice, other key currency earners of Vietnam, such as agro-fishery products, food, and consumer goods, have yet to reach their expected levels or fully tap the potential of both sides.

The HCM City government is working to improve the business climate and create favourable conditions in policies and procedures to welcome foreign investors and enterprises, including those from Indonesia, she noted.

Indonesian Consul General in HCM City Agustaviano Sofjan stated that despite the impact of the global economic downturn, the bilateral trade still experienced significant growth and is projected to hit 15 billion USD in the near future.

Their business communities mainly consist of small- and medium-sized enterprises, and both nations need to encourage more trade activities between them, the diplomat said.

Meanwhile, Edwin Setiawan Tjie, Chairman of the Indonesian Business Association in the city, stressed that apart from trade, the countries see potential for joint works in agro-fishery development.

Vietnam and Indonesia can share experience in adjusting policies, developing human resources, and promoting farm produce trade, he recommended, adding that in the aquatic farming sector, they can work together in technology transfer investment and researching sustainable farming models./.

Marine aquaculture crucial for economic growth: minister

Marine aquaculture plays a crucial role in reducing pressure on natural exploitation, increasing oceanic value, biodiversity, and promoting sustainable development, Minister of Agriculture and Rural Development Le Minh Hoan said on April 1.

In his remarks at a conference on sustainable marine aquaculture with a view from Quang Ninh held on April 1 in the northern province, Hoan said marine aquaculture will create new economic opportunities, livelihoods, and biodiversity, adding that it holds a leading role, contributing significantly to economic growth, state budget revenue, and employment.  

The event was jointly organised by the Ministry of Agriculture and Rural Development and the People's Committee of Quang Ninh province. It drew the participation of about 450 domestic and international delegates.

The conference aimed at accelerating the implementation of Project 1664 on marine farming in Quang Ninh province, identifying the current situation of aquaculture in the world and in the country, and rolling out procedures on environmental impact assessment, licensing and assigning marine areas for aquaculture in the locality in the near future.  

Nguyen Xuan Ky, Secretary of the provincial Party Committee, said that with a coastline stretching 2500km, fishing grounds covering over 6,100 sq.km and three marine conservation areas, Quang Ninh targets becoming the aquaculture hub of the northern region by 2030. The province has also designated 45,246 ha of coastal waters for aquaculture development, with a comprehensive approach towards modernisation, environmental friendliness, tourism services, as well as safeguarding national sovereignty. 

Quang Ninh has also restructured types of farmed seafood suitable for each region's advantages, improved productivity and product quality, he added. 

Norwegian Ambassador to Vietnam Hilde Solbakken said that to ensure efficient and sustainable marine aquaculture, countries need to establish suitable areas for fish farming and ensure environmental protection.

Noting that Vietnam has many regions suitable for marine aquaculture that have not been fully utilised, she suggested that it is necessary for the country to adopt new technologies, develop offshore aquaculture sites and manage waste and pollution properly.

The Prime Minister has approved a project on marine aquaculture development till 2030 with a vision to 2045, under which Vietnam targets having 280,000ha for marine aquaculture, achieving an output of 850,000 tonnes and export revenue of 800 million – 1 billion USD by 2025.

By 2045, sea farming will become an important part of the fisheries sector, accounting for over 25% of the total output and earning more than 4 billion USD in export turnover./.

Vietnam seeing positive export signs in Q1

Recovery of the world economy, including many major export markets of Vietnam, is a positive sign for the Southeast Asian nation’s import and export activities in the coming time.

Tran Thanh Hai, deputy head of the Ministry of Industry and Trade (MoIT)’s Foreign Trade Agency, said that total export-import turnover hit 178.04 billion USD in the first quarter of this year, up 15.5% year-on-year, resulting in a trade surplus of 8.08 billion USD.

Exports performed particularly well, with an estimated value of 93.06 billion USD, reflecting a 17% year-on-year growth, while imports reached 84.98 billion USD, representing a 13.9% increase.

In this quarter, 16 commodities reported an export value of over 1 billion USD each, accounting for 82.1% of the total export revenue, two higher than the 14 commodities recorded in the first quarter of 2023.

The export turnover growth of the domestic-invested enterprise sector reached 26.2%, nearly double that of the foreign-invested sector, including crude oil (up 13.9%), demonstrating efforts made the domestic economic sector to maintain and expand export markets.

Meanwhile, there were 17 commodities with import turnover of over 1 billion USD each, accounting for 76.1% of the total.

Bui Huy Son, head of the MoIT’s Financing Planning Department, said that Vietnam’s trade activities, especially export to key markets in Europe and America, will face both challenges and opportunities this year.

In addition to advantages for signed free trade agreements (FTAs), demand of the world market in general and Europe and America in particular is gradually recovering because inflation has been experiencing a downturn from the end of 2023 and is likely to approach the target level set out by central banks for 2024.

Those industrialised countries continue to promote strategies to diversify sources of supply, supply chains, and investments will help Vietnam become an important production and export centre in the global value chain. Meanwhile, the development of green economy, digital transformation, and circular economy of countries in Europe and America will also open up many new cooperation opportunities as well as providing a lot of credit and technology support to Vietnam, added Huy.

MoIT Deputy Minister Nguyen Sinh Nhat Tan said that the sector will closely monitor market developments and changes in partners' policies to propose appropriate solutions and develop a variety of traditional and new export markets.

It will continue making the most of signed FTAs, speeding up negotiations and signing of new ones, diversifying markets and supply chains, developing logistics services, and strengthening capacity on trade defence./.

VNDIRECT introduces support post cyberattack incident

VNDirect Securities Corporation unveiled favourable policies to customers following a trading disruption incident last week, but they are deemed insufficiently persuasive by critics.

As part of these measures, the securities firm will waive the transaction fees for underlying securities throughout April. This applies to both existing and new customers, excluding exchange fees for stock exchanges and taxes.

It also waives the interest on margin trading from March 25 until the trading system resumes. This applies to all customers with outstanding margin trading balances.

Moreover, VNDirect announces that they waive interest on debit balances and overnight position management fees for derivative securities trading from March 25 until the trading system resumes. This applies to all customers with outstanding debit balances or overnight positions.

The company will implement an interest rate of 9.3 per cent for margin trading in April. This applies to customers with margin trading balances on any day during the month. Both existing and new balances in April are included in this policy.

The customer appreciation programme for April will take effect once trading resumes for the respective services. Policies for May and June will be updated and communicated to customers as soon as possible.

Phạm Văn Hải, an investor from Hà Nội, told Vietnam News Agency that the fee-free trading policies are nothing new, as other securities companies are also racing to offer free trading. 

Meanwhile, the interest waiver on margin trading and the waiver of interest on debit balances for derivative position management only apply to investors who use these services.

For retail investors who do not utilise leverage, this policy is similar to what other securities companies have already implemented, even without any incidents, Hải said. 

VNDirect's system attack on March 24, disrupted services from March 25, is affecting investor transactions.

The company is now completing procedures to connect with the Hồ Chí Minh Stock Exchange (HoSE) and the Hà Nội Stock Exchange (HNX) after successful trading simulations.

Agricultural trade surplus nearly doubles in Q1/2024 on strong rises of coffee, rice

Vietnam’s agricultural, forestry and fishery sector runs a trade surplus nearly doubling the figure of the same period last year, on robust export of major products such as coffee, rice and fruits.

The latest updates of the Ministry of Agriculture and Rural Development showed that the agricultural, forestry and fishery export totalled US$13.53 billion, an increase of 21.8 per cent over the same period last year, while import reached $10.18 billion, meaning a surplus of $3.36 billion, an increase of 96.5 per cent.

Four major export products with export value of more than $1 billion included wood with a turnover of $2.32 billion, up 26.8 per cent; fruits and vegetables $1.23 billion, up 25.8 per cent; rice $1.37 billion, up 40 per cent; and coffee $1.9 billion, up 54.2 per cent.

Average export prices of major agricultural products see strong increases in the first quarter such as rice up by 5 per cent to $661 per tonne, coffee up 6.8 per cent to $2,373 per tonne, rubber by 5.1 per cent to $1,462 per tonne and pepper up 35.6 per cent to $4.153 per tonne.

Still, some products see drops in export prices such as cashew down 8.6 per cent to $5,329 per tonne, tea down 2.2 per cent to $1,616 per tonne and fertiliser down $9.1 per cent to $412 per tonne.

China is the largest export market of Việt Nam, accounting for 20.2 per cent of the country’s export value and sees an increase of 18.3 per cent, followed by the US with a share of 19.9 per cent and an increase of 28.3 per cent, and Japan with a share of 7 per cent and an increase of 4.6 per cent.

Coffee is the product with the strongest growth in the first quarter of this year.

Coffee export reached 799,000 tonnes worth $1.9 billion in the first quarter, rising by 44.45 per cent in volume and 54.2 per cent in value over the same period last year, setting a new record for three-month coffee export value.

Vietnam has increased exports of Robusta and Arabica, while reducing Excelsa.

Vietnamese coffee is exported to a number of markets including Italy, Spain, Russia, Indonesia, Belgium, China and the Philippines.

Coffee is the second largest agricultural export product, just coming after wood products, in the first quarter of this year, according to the ministry, which expects coffee export will hit a new record of $5-5.5 billion for the full year.

Rice export is also impressive.

With an export volume of $2.07 million tonnes and value of $1.37 billion, up 12 per cent and 40 per cent, respectively, Việt Nam continues to be one of the three biggest rice exporters in the world, accounting for 15 per cent of the global rice export, besides India and Thailand.

The global rice market has been significantly impacted by the ban on export by some countries, Russia’s withdrawal from the Black Sea Grain Initiative, and dropping output due to unfavourable weather conditions.

The ministry pointed out that India’s ban on rice export coupled with increasing demand from China and Indonesia are creating opportunities for Việt Nam’s rice.

The Philippines is the largest rice export market of Việt Nam, accounting for 85 per cent of the country’s total rice export, followed by Indonesia.

Fruit and vegetable export soared by 25.8 per cent to $1.23 billion in the first quarter.

The agriculture ministry forecast a new record for fruit and vegetables export this year, at $6-6.5 billion.

China is a huge market for Việt Nam’s agricultural products.

Four products are going to be exported officially to China, including medicinal herbs, coconuts, frozen fruits and watermelons.

The ministry said that huge opportunities remain for Việt Nam to promote export of agricultural products, which now accounts for just 2-3 per cent of the global export value. 

Bà Rịa - Vũng Tàu to become centrally-run city

Bà Rịa - Vũng Tàu Province has set out numerous development targets for 2030, including becoming a centrally-run city and developing its logistics and tourism sectors.

Bà Rịa - Vũng Tàu organised a conference on March 30 to launch its 2021 – 2030 development plan and facilitate investment, introducing the province’s strengths, development potentials and investment attraction priorities.

Phạm Viết Thanh, party secretary of the province, said that the locality has proven itself to be an important growth pole, being in the top five cities and provinces in terms of economy and provincial competitiveness index.

The investment into synchronous central and provincial infrastructure projects will allow the Southeast region and Bà Rịa – Vũng Tàu to realise their potential in industries, seaport, logistics, tourism and service in the next two years.

Bà Rịa – Vũng Tàu makes use of its natural advantages and has developed two new industries for the province, the chemical industry and renewable energy and wind power equipment manufacturing industry.

The 2021 - 2030 development plan with a vision towards 2050, approved on December 16, targets Bà Rịa – Vũng Tàu becoming a centrally-run city with an average gross regional domestic production (GRDP) per capita at US$18,000-18,500 by 2030.

It will also become a marine economy hub, a maritime service hub of the country and Southeast Asia, an international level tourism hub, and one of the largest industrial hubs of Việt Nam’s Southeast region.

By 2050, it targets net-zero emissions, contributing to Việt Nam’s commitment made to COP26.

Following the plan, it will focus on developing its Cái Mép – Thị Vải Port into an international transshipment port, setting up a free trade zone and building a national logistics hub linked with the seaport system in its Cái Mép Hạ area.

The province will develop large-scale industrial-urban-service complexes in Phú Mỹ Town (for which the province targets turning it into a city) and attract investment in petrochemical, electricity and electronics, robot manufacturing and artificial intelligence, among others.

It will also develop Vũng Tàu City to become a high-quality, world-class tourism hub, and completing the model of national tourist area and island eco-tourism urban area in Côn Đảo.

Deputy Prime Minister Trần Hồng Hà said that Bà Rịa – Vũng Tàu needs to become a leading region in green transformation, with its potential in wind energy, solar energy and gas-based energy.

It should have a roadmap for “greenifying” its industries and develop a circular economy model.

The province has identified four key industry groups for development, which are the industry sector; maritime economy and logistics service; tourism; and service industry linked with modern urban development.

It will have seven new industrial parks and five new industrial clusters. By 2030, it will have a total of 24 industrial parks (covering a total area over 16,000ha) and 16 industrial clusters (547ha).

During the conference, 15 projects received approval for investment and capital adjustment, as well as certificates of investment registration. Five of them were foreign projects.

The province called for investment into its key industry groups, with 92 projects across many fields such as urban development, housing, tourism development, seaport and logistics development, and industrial park infrastructure.

Bà Rịa – Vũng Tàu currently has over 1,100 investment projects under operation, including 465 foreign projects with over $33 billion of total registered capital.

The first quarter of 2024 saw over $1.5 billion worth of FDI and VNĐ25 trillion of domestic investment poured into the province.

Bà Rịa – Vũng Tàu’s economy reached over VNĐ366 trillion in 2023, accounting for 3.51 per cent of the country’s GDP.

Its GRDP per capita in 2023 is over $8,000 per person per year, nearly doubling the country’s average. -

Adjusting prices will depend on assessment of macroeconomic impacts: MoIT

The Government allows the adjustment of the average retail electricity prices every three months. But that does not mean regular changes will happen. Adjusting this price will depend on the assessment of impacts on the macroeconomic development and updated electricity production and business costs.

That was the message from Nguyễn Thế Hữu, deputy director of the Electricity Regulatory Authority, Ministry of Industry and Trade (MoIT) speaking at the ministry's regular press conference in Hà Nội last Friday.

This adjustment according to the Decision No. 05/2024/QĐ-TTg, signed by Deputy Prime Minister Lê Minh Khái on March 26, basically inherits the old decision, but the new point is shortening the adjustment time to every three months.

According to Hữu, shortening the adjustment period of the retail electricity price will not affect the Electricity of Việt Nam's financial balance, and make the electricity prices follow closely the fluctuations in input factors of the market.

The MoIT still manages the electricity prices and will coordinate with the Ministry of Finance and relevant units to ensure fairness and transparency in managing this price, and also in operating the energy market, including the electricity market.

Every year, the MoIT will cooổdinate with agencies to review the costs of electricity production and transmission, and disclose them to the people and press agencies to ensure fairness and transparency.

As manager of the Electricity of Việt Nam (EVN), MoIT still holds the main role and responsibility in the process of inspecting and reviewing the electricity price plan built by EVN. 

It also has the responsibility in carrying out the inspection and adjustment of the electricity prices, as well as proposing solutions on managing electricity prices to the Prime Minister.

Also, according to Decision No. 05/2024/QĐ-TTg, EVN will be given autonomy to implement a price increase within the range of 3-5 per cent. 

In the event that EVN proposes a price increase within the range of 5-10 per cent, it must report to the MoIT. Within 15 working days, the ministry, in turn, must provide EVN with an answer.

In case EVN proposes a price increase greater than 10 per cent, the MoIT is charged with the task of submitting a report, after a period of consulting other ministries and governmental agencies, to the Prime Minister for consideration. 

The new mechanism could make the retail electricity price increase after the decision takes effect from May 15, 2024. MBS Securities believes that retail electricity prices will likely increase in the range of 5-10 per cent this year.

According to MBS, this mechanism will significantly reduce the pressure from input fluctuations that were clearly reflected in the 2021-2023 period. Accordingly, EVN's financial situation will not only improve in the short term, but also be more secure in the long term.

In 2024, the new mechanism will create conditions for EVN to increase the retail prices, partly having money to pay for factories, especially the group of thermal power, such as PetroVietnam Power Corporation (stock code: POW), Power Generation Joint Stock Corporation 3 (PGV), PetroVietnam Power Nhơn Trạch 2 JSC (NT2), and Quảng Ninh Thermal Power Joint Stock Company (QTP).

Meanwhile, the group of power construction, such as PC1 Group Joint Stock Company (PC1) and Power Engineering Consulting JSC 2 (TV2), will also benefit from the retail price increase because the demand for power infrastructure investment this year is expected to increase 12 per cent year on year. 

Improving the finance helps EVN ensure investment activities without interruption. If the retail electricity prices increase by 5 per cent-10 per cent in 2024, 0.4 per cent-5 per cent higher than the average input price in Q3 2023, EVN's revenue is expected to increase by VNĐ43-73 trillion.

For the long term, the new retail price mechanism is necessary. According to the Power Master Plan 8, the proportion of high-cost power sources will increase. Of which, the liquefied natural gas (LNG) power capacity will increase from 9 per cent to 24 per cent, and the wind power capacity increase from 6 per cent to 18 per cent.

This is expected to push up the average mobilisation costs of EVN's plants rapidly when the proportion of low-cost traditional power sources is expected to gradually decrease.

With the new mechanism, MBS hopes the room to mobilise high-cost power sources will also increase and partly help speed up the progress of negotiating purchase power agreements (PPA) for gas power projects, as well as deploy renewable energy policies because this mechanism helps transfer part of the risk of increased costs to retail prices. 

Electricity enterprises with LNG power projects such as POW, PGV or leading renewable energy enterprises REE, GEX, HDG and BCG will be able to benefit from this mechanism.

Regarding electricity supply in the summer months, MoiT deputy minister Nguyễn Sinh Nhật Tân said that "the electricity shortage situation will not repeat not only this year, but also in coming years."

Although the electricity supply in the first quarter of this year increased by over 11 per cent compared to the forecast, the ministry has coordinated with relevant parties to actively deploy solutions on ensuring power supply, especially in the summer.

Of which, the solution proposed by the ministry is to focus resources to complete power, grid and transmission projects, and ensure enough coal and gas fuel supply for thermal power plants.

At the same time, the ministry is strengthening monitoring and inspection for operations in power plants and troubleshooting of problems. It regulates operation of hydropower plants, strengthen the review of power transmission lines, and has propaganda on electricity saving.

The management of power supply also has innovations in planning, operating and dispatching the power system.

In particular, the ministry has issued a separate electricity supply plan for the dry season months. From April to July, the power supply situation will be monitored monthly to have timely adjustments.

Coffee exports may reach US$5 billion in 2024

The export value of coffee may reach US$5 billion this year, according to the Ministry of Agriculture and Rural Development.

Viet Nam shipped nearly 799,000 tons of coffee, worth US$1.9 billion in January-March period, with average price of US$3,500-US$4,000 per ton, said the ministry.

The Southeast Asian nation is the second largest coffee producer and exporter in the world and its coffee has been exported to 70 countries and territories.

Lam Dong province in the Central Highlands and Son La province in Northwest Viet Nam are the major Robusta cultivation hubs.

Last year, coffee exports decreased by 9.6 percent to 1.61 million tons but export revenue rose to a record high of US$4.18 billion.

Tourism collaboration activities between HCM City, Mekong Delta boosted

The People’s Committee of Ca Mau Province has just issued the implementation plan of the linked program on tourism development between Ca Mau Province with Ho Chi Minh City and the Mekong Delta provinces, cities in 2024.

According to the plan, the Mekong Delta province of Ca Mau will proactively join the forum on the regional link for tourism development cooperation between Ho Chi Minh City and the Mekong Delta for the third time in 2024; program of voting the attractive destinations of Ho Chi Minh City and the Mekong Delta; connected spaces of areas, tourism points and tourism services providers between HCMC and Mekong Delta.

Besides, the locality shall collaborate to draft the plan of developing linked tourism products between HCMC and the Mekong Delta.

In addition, the Mekong Delta province of Ca Mau will also participate in inspirational and sharing programs for tour guides winning prizes of contests “Good tour guide in HCMC” at tourism training facilities in the Mekong Delta provinces and cities; join the professional training sessions to improve skills to develop the tourism sector and management of tourism destinations serving for tourists, promotion programs and so on.

Soaring German investments are testament to trust in Vietnam

Amid the prevailing winds of trade protectionism and escalating international sanctions, German investment in Vietnam is a testament to investors' trust in the potential of the Southeast Asian country.

The findings from the "Going International 2024" survey offer a beacon of enlightenment into the world of global business strategies, particularly illuminating the pathways of German investors both globally and within the vibrant landscape of Vietnam. Spanning from January 25 to February 11, 2024, this insightful inquiry engaged nearly 2,400 businesses headquartered in Germany and operating across international borders.

By the close of 2023, German investments in Vietnam had soared, culminating in 463 projects with an impressive total registered capital nearing $2.7 billion. This marked Germany's position as the 17th largest investing entity in Vietnam, a testament to the burgeoning partnership between the two nations. Notably, more than half of these ventures are concentrated in key hubs such as Ho Chi Minh City, Hanoi, Binh Duong, Dong Nai, and Hai Phong, with the remainder scattered across 33 other provinces and cities.

Among the approximately 500 German enterprises operating in Vietnam, over 100 have been actively engaged in manufacturing activities since 1993, underscoring the confidence of German businesses in the Vietnamese market and Vietnam's ascendancy as a premier destination for businesses seeking expansion within Asia.

Marko Walde, chief representative of the Delegation of the German Industry and Commerce in Vietnam, Myanmar, Cambodia, and Laos, said the European Union-Vietnam Free Trade Agreement (EVFTA) is acting as a catalyst for enhanced trade and investment between Vietnam and the EU, with Vietnam's steadfast dedication to these principles fostering a conducive business environment, thereby attracting heightened interest from German investors.

In the Asia-Pacific region (excluding China), German enterprises are also embracing a brighter outlook compared to their counterparts in other regions. A significant 65 per cent of businesses anticipate market stability, with an additional 15 per cent foreseeing positive advancements. Notably, this region stands out for its relatively less pessimistic business climate, and is poised to benefit from the strategic diversification of supply chains.

Illustrating this proactive approach, several German companies currently operating in China are expanding their supplier networks or establishing footholds in the Asia-Pacific region as part of the innovative "China +1 Strategy". However, amidst these promising prospects, challenges persist, particularly in bilateral German-China trade. The economic slowdown in China, coupled with escalating trade barriers such as localisation requirements, presents formidable obstacles.

The latest findings reveal a stark reality: a staggering 61 per cent of enterprises, the highest proportion recorded since 2012, grapple with escalating trade barriers, casting shadows over international operations.

Central to these challenges are the formidable hurdles of local certification requirements and heightened security protocols, exacerbating the intricacies and costs associated with cross-border trade. Moreover, the spectre of sanctions, particularly in dealings with Russia, looms ominously, alongside the opacity of legislation, elevated tariffs, and stringent local content regulations.

Compounding these external challenges are the burgeoning domestic impediments originating from within Germany itself, a disconcerting trend observed by 81 per cent of companies. Bureaucratic entanglements and regulatory uncertainties, epitomised by initiatives like the EU Carbon Border Adjustment Mechanism and the Supply Chain Due Diligence Act, ensnare enterprises in a web of complexity and ambiguity. Additionally, the protracted approval processes from the Federal Office for Economic Affairs and Export Control (BAFA) and convoluted customs clearance procedures further exacerbate the hurdles in international transactions.

Despite the modest growth of the global economy, German companies find themselves on the sidelines of prosperity, with bleak prospects for export growth in the current year. This prevailing sentiment reverberates globally, with 26 per cent of enterprises anticipating a deterioration in foreign business, juxtaposed against a meagre 13 per cent expecting improvement.

Seaport investment creates new promise

The seaport industry’s evolution in Vietnam continues to be driven by the government’s development strategy towards 2030 and beyond.

The Ministry of Transport (MoT) is working on adjustments of the master port development plan towards 2030, with a vision up to 2050. The adjustments focus on general goals, land and water use needs, capital requirements, prioritised ventures, and solutions for implementing planning on the environment, sci-tech, and more.

The prioritised list of projects will include international gateway port areas such as Lach Huyen in the northern city of Haiphong, Cai Mep in the southern province of Ba Ria-Vung Tau, and Can Gio international transit port. Meanwhile, Ho Chi Minh City seaport is expected to be upgraded from a potential type 1 seaport into a special seaport; and demand for international transshipment goods through Lien Chieu Seaport in Danang will rise to up to one million TEU a year by 2030.

Total investment in the seaport system by 2030 is estimated at $14.83 billion, an increase of $1.62 billion, prioritising additional public infrastructure projects of the Tran De offshore port area and Can Gio international port.

According to experts, the amendments are significant and if approved will create better conditions for international investors, especially those with existing seaport projects in Vietnam, to operate more smoothly.

“The master port development plan, together with seaport infrastructure, connecting traffic corridors, and many other service and utility facilities can be seen as a great opportunity for foreign businesses,” said senior seaport expert Ho Kim Lan.

“There are solutions to increase investment flows in the industry in coming years, but the main ones are policies to innovate infrastructure. Ensuring legitimate benefits for investors under the public-private partnership mechanism is also important,” Lan continued.

Thus far, many globally renowned names have shown their strong interest in the transport sector and seaports in particular. For instance, International Holdings Company at a meeting with the Vietnamese prime minister late last year said that it eyes investment and cooperation opportunities in seaports, logistics, digital transformation, and smart cities.

Elsewhere, Indian multinational Adani Group plans to start its investment path in Vietnam with the $2 billion Lien Chieu Seaport in the central city of Danang, in cooperation with Vietnam Maritime Corporation (VIMC).

“We are preparing for pre-feasibility and feasibility studies of Lien Chieu Seaport. It shows our commitment to Vietnam, and we expect to develop an industrial park complex with the port,” said CEO Karan Adani in December.

While seeing potential ahead, seaports are still facing a challenging period, including joint venture seaports of VIMC and its foreign partners, although they saw improvements in the first two months of 2024.

Cai Mep International Terminal (CMIT), which has Denmark’s APM Terminals as a foreign stakeholder, saw a 46 per cent on-year increase in container throughput during the two-month span, while the threshold was an increase of 31 per cent on-year from SSIT, a joint venture between VIMC and SSA Marine.

Last year, an unfavourable global economic situation and weak consumption demand, especially in the US and EU, seriously affected seaport operators. As a result, VIMC’s total seaport throughput and revenue fell 16 and 7 per cent from the yearly targets, respectively.

“We saw plenty of new seaports operational with bigger wharfs, modern equipment, and capacity to receive large ships, while market demand did not increase, thus leading to a more serious oversupply situation,” said Nguyen Canh Tinh, CEO of VIMC.

“The seaport industry is yet to see a bright future in 2024 as a number of factors should be counted like drought in the Panama Canal, unstable developments, and geopolitical tensions among countries affecting the operations of shipping lines and can lead to possible disruption of the global supply chain, and will directly affect the output of goods through the seaport system,” Tinh added.

In particular, while CMIT reported an increase in its output compared to the yearly target last year, it accommodated 16.98 million tonnes of goods, while its container throughput reached over 1.2 million TEU last year, both down 12 per cent on-year. Its pre-tax profit was -$7.38 million.

Like CMIT, other seaport joint ventures with VIMC like Cai Lan International Container Terminal (CICT), SSIT, and SP-PSA also had a tough year. SSIT saw container throughput and pre-tax profit decrease during the year. Similarly, SP-PSA, which VIMC runs with Singaporean-based PSA, witnessed a pre-tax profit drip of -$1.8 million.

For CICT, located in the northeastern province of Quang Ninh, and is run by VIMC and US-based Carrix, the parent company of SSA Marine, its container throughput fell 90 per cent on-year, and its pre-tax profit was -$18 million.

Gold price increases 8% in Q1

The price of SJC gold bars rose to nearly 81 million VND (3,266 USD) per tael (one tael is equivalent to 1.33 ounces) in the last trading session of the first quarter (March 30), up 8% from the outset of the quarter.

On March 30, SJC gold bars were sold for 80.82 million VND per tael, compared to over 75 million VND per tael at the beginning of the year. 
In March alone, the gold price rose by 1.25%, peaking at 82.5 million VND per tael in the period from March 10-12. 

The global gold prices rallied 9% in March, driven by expectations of interest rate cuts by the US Federal Reserve this year and high demand on safe assets. 

According to Deputy Governor of the State Bank of Vietnam Pham Thanh Ha, despite the complex price fluctuation, the gold market remained stable, causing no pressure on the official foreign exchange market./

Store owners see challenges displaying goods on trading floors

Many shop owners and trading floors have not been able to find common ground, leading to discouragements in their economic partnership.

Several enterprises, especially small and medium-sized ones, are yearning to enter renowned trading floors and supermarkets to increase their brand recognition and expand their market. Yet the sad news is after some time, they themselves wish to opt out since it takes them too much money to stay there.

D.N., director of a business specializing in produce processing and trading (both nationally and internationally), admitted that for his merchandise to be displayed in supermarkets, he has to pay different expenses, to have his goods undergone quality control, to offer a 15-30 percent discount rate to retail systems. That is not to mention mandatory participation in promotional campaigns of those trading floors at special events.

For the products to appear on online trading floors like Sh., the service expenses are also extremely high of up to 23.5 percent. That includes advertising (6 percent), packaging (1 percent), cost of risk (2 percent), soft costs (1 percent), tax rate (1.5 percent), and the fee paid to that e-commerce floor (12 percent).

However, payments from these systems are often delayed by 45-60 days, or even 90 days. These factors have negatively affected the profit that the business can earn, making him stop the partnership with these trading floors.

Agreeing with that, another business owner dejectedly shared that it is too hard to let his merchandise enter supermarkets or other prestigious trading floors, but then consumption is too slow there. Hence, he has decided to switch to better marketing methods for his goods like self-advertising and livestreaming on social network sites.

Obviously, for a long-term partnership between merchandise suppliers and supermarkets or e-commerce trading floors, there should be a fairer playground.

On their side, managers of a large-scale retail system in HCMC commented that they have tried to support shop owners and businesses. Nevertheless, they have different costs to pay as well, like premise leasing, utility bills, staff salary. They themselves are merely an intermediary between suppliers and buyers, and they cannot cut costs further.

In addition, the space for goods display is rather limited but has to accommodate hundreds of brands. The race for a part of that restricted space is extremely harsh. Meanwhile, to have an eye-catchy location, businesses do have to pay more.

The e-commerce trading floor Shopee has already made action in response to a report from the community that the time to send payments to shop owners after a successful transaction is too long. It now agrees to send the money after 3 days for regular orders and 7 days for those created on Shopee Mall. As to buyers, Shopee still maintains the 15-day return policy.

At a recent working session between the HCMC Industry and Trade Department, modern retail systems, and goods suppliers, there was a strong stress on better cooperation among stakeholders for mutual benefits in the future.

However, seeing that inadequacies still exist, it seems that the applicable policies of leading e-commerce trading floors and retail systems are more and more challenging for small and medium-sized enterprises, despite the fact that these businesses account for 96 percent of the total companies in the country as well as 40 percent of the national GDP.

Vietnamese PMI declines slightly on falling orders

Vietnam’s Manufacturing Purchasing Managers' Index (PMI) dropped slightly to 49.9 in March after its improvements in the previous two months, according to index provider Standard & Poor’s Global (S&P Global).

As reported by S&P Global, subdued demand led to falls in output and new orders. Also, new export orders shrank the most since last July due to competitive pressures and geopolitical issues.

S&P Global’s report points out that firms had cut their purchasing activity for the fifth month, resulting in a solid drop in stocks of inputs. Concurrently, employment rose at the fastest pace since October 2022.

Outstanding business also depleted for the second month, with the rate of decline being the steepest in five months. Delivery times were also broadly unchanged as overseas shipping delays were canceled by vendors who already had sufficient inventory holdings to meet orders.

According to S&P Global’s survey, on the cost front, input prices rose the least since last August and were weaker than average. In addition, selling prices fell for the second time over the past three months.

The S&P Global Vietnam Manufacturing Purchasing Managers’ Index measures the performance of the manufacturing sector and can be derived from a survey of 400 manufacturing companies.

It is based on five individual indexes with the following weights including new orders at 30%, output at 25%, employment at 20%, suppliers’ delivery times at 15%, and stock of items purchased at 10%.

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