The HCMC People’s Committee has announced the coefficients for land prices applicable to the compensation and resettlement plans in the city this year, with the highest coefficient set at 35.

The coefficient for residential land in Thu Duc City and other districts range from 3 to 15, while that for residential land in five suburban districts are from 8 to 15. The coefficient for agricultural land range from 7 to 35, meaning farmland can be compensated at a maximum level which is 35 times higher than the price announced by authorities.

The prices of residential land and agricultural land are 3-15 times and 7-35 times above those in the land price table issued by the HCMC People’s Committee, respectively.

The coefficients are used to calculate the land prices based on the conditions of the local real estate market, socio-economic conditions and land price lists. One of the methods to determine the value of the land is to multiply the coefficient with the price in the price table.

The land price coefficient is usually issued at the beginning of year and doesn’t show the specific price of land for compensation. The land price adjustment coefficients for compensation and resettlement in 2022 are higher than in 2021.

Eleven housing projects eligible to access financial aid package

Some 11 social housing and aging apartment building renovation projects are eligible to receive financial aid packages with discounted interest rates in the second phase of the review.

The Ministry of Construction has sent the State Bank of Vietnam the list of projects eligible for the interest subsidy package as per Decree No. 31/2022/ND-CP dated May 20.

Among the 11 projects eligible for the package, seven are social housing projects for workers and low income residents and four aging apartment building renovation projects.

These projects have been proposed by the People’s Committees of HCMC and Binh Dinh Province, with 7,904 units and VND9,646 billion in total investment capital. They are recommended for borrowing some VND4,345 billion.

The People’s Committees of the cities and provinces are responsible for the procedures of project investment and construction, the selection of investors, land allocations, and land leases.

The State Bank of Vietnam should notify commercial banks of disbursing the loans, in compliance with relevant laws, according to the Ministry of Construction.

Among 240 social housing and renovation projects in the first phase of the review, only four projects with a scale of 6,426 apartments and investment capital of VND4,665 billion met the requirement for receiving the interest subsidy package.

According to the proposals of the local authorities in Lao Cai, Hoa Binh, Tay Ninh and Tien Giang, those projects sought loans of some VND1,751 billion.

Vietnam to increase coal imports in 2025-2035 period: Ministry

Vietnam’s coal imports are forecast to rise to meet domestic production demand, according to a draft strategy for developing the coal industry in Vietnam recently introduced by the Ministry of Industry and Trade (MoIT).

Accordingly, Vietnam will import about 50-83 million tonnes of coal per year during the period from 2025 to 2035, with the volume gradually falling to about 32-35 million tonnes by 2045.

The data from the MoIT shows domestic coal consumption increased rapidly from 27.8 million tonnes in 2011 to 38.77 million tonnes in 2015, and about 53.52 million tonnes in 2021.

The volume of coal consumed at present has more than doubled compared to 2011, mainly for electricity production.

The demand for primary energy, including coal, will continue to increase, possibly peaking in the 2030-2035 period, the ministry said.

Vietnam's coal demand will be around 94-97 million tonnes in 2025, and peak at 125-127 million tonnes in 2030, mainly due to the increase in demand for power generation, and the cement, metallurgy and chemical industries.

PM urges greater labour market development

The labour market plays by the law of supply, demand, and competition, therefore synchronous policies should be perfected in order to help the domestic labour market develop in a flexible, modern, and sustainable manner, said Prime Minister Pham Minh Chinh.

The PM made the request at a national conference on labour market in Hanoi on August 20, which was connected to all localities across the country.

It can be considered imperative to swiftly develop a system of labour market information, a system of employment service centres, and a system of vocational training centres, among other things, he pointed out.

The PM went on to stress the necessity of building a modern and transparent labour market management system, making it easier for people to gain access to employment services and for businesses to recruit high-quality human resources.

He called for resources to be pooled together as part of efforts to develop a multi-tiered labour market forecasting and information system targeting users that are State management agencies and businesses, with a specific focus on employees.

More attention should be paid to job generation in rural and remote areas to ensure that local residents receive steady incomes and do not migrate en masse to major cities, he ordered.

PM Chinh also requested that relevant ministries and agencies quickly implement housing support policies for workers, especially those in industrial zones and big cities.

Circular business new notion to Vietnamese firms
     
Viet Nam has been increasingly embracing the green transition and circular economy to make efficient use of its resources to boost economic growth, according to Nguyen Hoa Cuong, Deputy Head of the Central Institute for Economic Management (CIEM).

Cuong revealed that the Government approved the National Green Growth Strategy in October 2021 and the Scheme for Circular Economy in June 2022 to commit itself to the green path. Recently, the Government has also assigned its ministries the task of developing a sandbox for testing circular economic models in the country.

Trinh Duc Chieu, Deputy Head of CIEM's Department for Research Reform and Enterprise Development, asserted that the notion of circular business is new to Viet Nam's business community. He said just 3 to 6 per cent of Vietnamese firms are fully aware of the notion, whereas those partly aware account for 20 to 30 per cent.

About 9 to 10 per cent think that the existing legal framework for circular business is adequate. Meanwhile, 18 to 20 per cent believe such a framework is absent. Only 2 to 15 per cent have received Governmental support in some form, including preferential credits. Training support, specifically, has gone to 15 per cent of the firms.

Vo Tri Thanh, Director of the Institute for Brand and Competitiveness Strategy, underscored digital transformation and circular economy as the two pre-conditions for green growth. "Consumers' green mindset will be the driving force behind green transition," he added.

Le Duy Binh, Director of Economica Vietnam, underlined that green consumers are the key to a circular economy since their buying decisions dictate firms' production. "Policies to promote a circular economy should be formulated more consumer-centrically to produce their desired effects," he said.

Tran Van Hieu, Deputy Director of Lagom Vietnam LTD, introduced the circular business model that his firm has been embracing for many years. The model comprises five steps, which are communicating, sorting, collecting, recyling and manufacturing. He called for more favourable tax policies to save recycling firms from unnecessary costs.

VNA to offer over 400,000 seats during upcoming holiday

National flag carrier Vietnam Airlines (VNA) is planning to offer more than 400,000 seats to meet the rising travel demand during the upcoming four-day national holiday early next month.

To commemorate Vietnam’s National Day on September 2, the carrier will offer the seats between September 1 and 4, up over 50% against the pre-pandemic figure in 2019. The growth has demonstrated the ongoing recovery of the domestic aviation sector after a long period of being battered by the pandemic.

VNA will increase flights on the busy routes linking the major cities of Hanoi, HCMC and Danang with popular destinations in Nha Trang, Quy Nhon, Phu Quoc and Dalat.

VN manufacturing output returns to growth as pandemic situation improves
     
IHS Markit’s latest survey released on Monday showed the Vietnam Manufacturing Purchasing Managers' Index (PMI) posted back above the 50.0 no-change mark at 52.1 in October following a reading of 40.2 in September. This signalled a renewed improvement in business conditions across the sector, thereby ending a four-month sequence of decline.

According to the survey, renewed expansions were seen for output, new orders and purchasing activity, while business confidence jumped higher. On the other hand, employment continued to fall amid widespread reports of workers remaining in their hometowns following the latest wave of the COVID-19 pandemic.

Price pressures remained acute, with input costs rising at one of the sharpest rates on record amid higher freight charges and raw material shortages. In turn, firms increased their own selling prices at a much faster pace than in September.

A loosening of COVID-19 restrictions led a number of firms to restart production in October, while others expanded output in response to higher new orders. As a result, production growth was recorded for the first time in five months.

A solid return to growth of new orders was also registered as manufacturers and their customers alike resumed operations. The improvement in the pandemic situation enabled firms to take advantage of increased demand in international markets, posting a first rise in new export orders since May.

The survey showed business confidence improved markedly in October as the latest wave of the COVID-19 pandemic showed signs of easing. Hopes that the pandemic will remain under control helped optimism reach a 29-month high.

Ha Noi seeks to facilitate UKVFTA implementation
     
The capital city will seek to improve competitiveness for local businesses so that they may take advantage of opportunities brought by the UK-Viet Nam Free Trade Agreement (UKVFTA), according to a recently announced plan of the municipal People's Committee.

Under the plan, priority will be given to facilitating the development of small and medium-sized enterprises through capital, training, access to markets and information and technology.

The city will also help local businesses link with each other, create value chains and supply chains with the participation of UK businesses to take advantage of the UKVFTA while encouraging the UK-invested businesses to team up with local firms to build and develop these supply chains.

Furthermore, it will focus on restructuring the agricultural industry, facilitating digital transformation, applying science and technology and advancing production models in the direction of improving product quality while ensuring the environment protection and product traceability to meet domestic and international standards.

The city will also seek to improve the quality of human resources, providing specialised skills training for businesses and stepping up investment, trade and tourism promotion, according to the plan.

Ha Noi and Hoa Binh connect trade and consumption of agricultural products
     
Many key products of the northern mountainous province of Hoa Binh have entered the system of supermarkets and large commercial centres in Ha Noi, Deputy Director of the provincial Department of Agriculture and Rural Development Vuong Dac Hung told a recent conference.

The provincial Department of Agriculture and Rural Development in collaboration with the Ha Noi Department of Agriculture and Rural Development held a conference on ensuring food safety between the city and province in the northern mountainous province.

The conference highlighted the results of the implementation of the programme which coordinates trade, promotes agricultural product consumption and State management in the agricultural sector between the capital city and Hoa Binh Province in the 2016-20 period and the 2021-25 period.

The organisation of goods weeks, fairs and forums in Ha Noi has created a trading point and connected product consumption for businesses, restaurants and hotels.

Thereby, key products of the province such as Song Da fish, Cao Phong oranges, Tan Lac red-flesh grapefruit, organic vegetables, and hill chicken have been supplied to supermarkets and retail systems in Ha Noi.

Market attempts to stabilise pork prices

A rise in pork has benefited some husbandry companies in Vietnam, with the government ordering stabilising measures to help rein in inflation at around 4 per cent this year.

The price of pork in Vietnam in August so far has increased by more than VND10,000 (43 US cents) per kg as compared to last year while livestock production has decreased significantly.

The government is closely monitoring pork price movements amid rising inflationary pressures. Prime Minister Pham Minh Chinh on July 31 requested to strengthen measures to stabilise pork prices and promote production to ensure supply.

Hoang Trong Thuy, an independent agricultural policy analyst in Vietnam, said that the price increases were due to supply shortage in some provinces thanks to African swine fever (ASF) in the first quarter, rising pig prices in China, and rising feed costs. “Vietnam’s agricultural market is always sensitive to factors coming from China,” Thuy said.

According to China’s National Development and Reform Commission, as of the week ended July 1, hog prices in the country had increased by 46 per cent compared to March. Pork prices, which rose nearly 3 per cent in June from May, also added to the country’s inflationary pressures.

Two months before the Mid-Autumn Festival is typically the time when Chinese businesses increase their purchases of pork from here for mooncakes. The geographical advantage also provides greater added value for Chinese buyers, as logistics costs are lower than in other countries, such as Brazil, Canada, the EU and the United States.

In Vietnam, rising pork prices have begun to impact the livestock industry in recent weeks.

Nguyen Kim Doan, vice chairman of the Dong Nai Breeding Association, said that the price of live pigs is around $2.8 per kg. “This has not been a driving force to motivate farmers to reorganise their herds,” Doan said.

The average live hog price in August 2021 was about $2.39 per kg, much lower than the high average of $3.50 in 2020. Dong Nai, the southern province with the largest pig production in the country, currently has only around 6,100 smaller pig-raising households, a decrease of thousands compared to the period of time before the outbreak of ASF, according to Dong Nai Department of Agriculture and Rural Development.

Vietnam aims for annual US$12 billion in seafood exports

The Government has launched the national program for aquaculture development from 2021 to 2030, setting a target of US$12 billion in yearly seafood exports.

The program is designed to develop the aquaculture sector amid climate change, to raise its productivity and ability to compete to meet domestic and global needs.

In specific, by 2025 the total aquatic output looks to reach 5.6 million tons annually, or US$7.8 billion in annual export turnover and 4 percent of aquaculture’s average growth rate.

Key infrastructure covering 30 aquatic cultivations and breeding areas will be enhanced with chains of production, processing, and consumption to ensure the outcome of over 30 percent of aquatic output.

By 2030, the total aquatic output is to reach 7 million tons per year, estimated at US$12 billion in annual export turnover and a growth rate 4.5 percent of aquaculture products. Also, an additional 20 aquaculture cultivation and breeding area infrastructures will be improved to ensure the output of over 50 percent of aquatic products.

Raw material price hikes discouraging feed producers

High prices of feed ingredients have been having an effect on feed producers while customers do not want to bear additional costs. Producers of typical animal feed, such as maize, rice, soybeans, and cassava, have suffered losses, posing a challenge for policymakers who are already struggling with high inflation.

In Vietnam – Southeast Asia’s leading country in animal feed production with a total output of up to 20 million tonnes per year – some small producers are struggling to fulfil orders from the last three months as raw material prices were lower. In May, the average price of corn was $344 per tonne, as data from the General Department of Vietnam Customs (GDVC) showed.

Many small feed businesses are in short supply of raw materials because the transportation sector still faces difficulties due to disease control and high costs, leading to increased cost of feed ingredients by up to 30 per cent. Some other producers are trying to replace imported materials with cheaper domestic ones.

The complicated developments of the Russia-Ukraine war also affect the supply chain of raw materials for animal feed production in Vietnam – where there are 265 factories, including 89 foreign-invested ones – provide almost 60 per cent of all feed for domestic and export livestock enterprises and households, according to the Department of Livestock Production under the Ministry of Agriculture and Rural Development (MARD).

Tong Xuan Chinh, deputy director of the department, said the price of raw materials will continue to increase until the end of 2022.

In the first six months of 2022, Vietnam imported corn at an average price of $353 per tonne, $86 higher than the average price in the same period of 2021, according to the GDVC.

Many producers are expecting that the price may continue to weaken in the near future as the price of corn at Vung Tau Port in the south has dropped to 34 US cents per kg. According to the Commodity Exchange of Vietnam, drought in the United States is still a factor to watch out for in the next two months, the most important period of crop development. If the heat condition in the US Midwest does not improve, corn and soybean yields face the risk of decline and lower yields than currently forecast. This situation may make agricultural products continue to stay anchored at the current price range and render it difficult to drop lower than the same period last year.

Vietnam, India strengthen tourism ties

Tourism ties between Vietnam and India are expected to grow strongly as tourist exchanges between the two countries have increased significantly after the fourth wave of the Covid pandemic.

Internet searches for Vietnamese tourism from the Indian market had shot up 400% in the year to April and are forecast to continue rising, according to Google’s market trend tracking tool.

Previously, 2019 saw 170,000 Indians traveling to Vietnam, pushing India to the 16th spot among those with the most visitors to Vietnam. In the same year, 50,000 Vietnamese visited India.

Recently, Vietnam and India have introduced many tourism activities to attract international tourists such as applying the e-visa policy and simple entry procedures, vaccine passport recognition, and 60 weekly direct flights between the two countries.

Railways offer discounted fares to woo passengers

The national railway operator has launched a promotional program with ticket prices lowered 5-7% to attract more passengers at a time when buses and airlines are increasing their rates ahead of the upcoming national holiday on September 2.

The Vietnam Railway Corporation said the train frequency will be increased to meet the travel demands of passengers during Vietnam’s National Day.

Meanwhile, bus ticket prices will go up by 20-40%. Airfares are also rising amid the rising travel demand.

A representative of the World Transportation Services JSC (WorldTrans) said flights connecting HCMC with Hanoi, Danang, Phu Quoc and Dalat would have the most passengers on September 2. Airfares have been revised up VND1-2 million per return ticket, depending on the destination.

The round-trip ticket price for the route from HCMC to Hanoi on September 2 is priced at VND4,659,000 against VND3,450,000 as before. Fares for the HCMC-Dalat route on September 2 increased to VND3,275,000 from the usual rate of VND1,850,000 per ticket.

Resort real estate trying to rise higher in Asia-Pacific

Although an excess of supply is set to hit Vietnam’s top tourist destinations, and geopolitical issues are complicating matters, long-term resort real estate could also be one of the better investment channels – not just in this country but on a regional basis, too.

Earlier this year, groups such as VinaCapital issued reports to investors that noted there was no need to worry about the impact of the Chinese economy on Vietnam, even though the trade between the two countries is very large.

However, investors do remain concerned about the potential impact on Vietnam of China’s continuing strict pandemic policies, which are making it difficult for Chinese tourists, who previously accounted for a third of Vietnam’s total tourist arrivals, to return to Vietnam anytime soon.

Meanwhile, the hospitality sector is witnessing a reduction of Russian visitors to Vietnam due to the conflict in Ukraine and the subsequent sanctions placed on Russia.

In a new report on the general economic and financial situation so far in 2022, the Ministry of Finance (MoF) expressed concern about the inflation situation, although the statistics so far are “adequate”.

The consumer price index (CPI) in July increased by 0.4 per cent compared to the previous month, or 3.14 per cent over the same period last year and increased by 3.59 per cent compared to December 2021, the highest since 2018.

Although the inflation forecast in 2022 will be around 4 per cent, international organisations forecast Vietnam’s CPI in 2022 at 3.7-4.2 per cent, but the MoF also emphasised the risk of inflation.

In addition, Vietnam’s tourism property also faces an excess of supply. According to estimates by Savills, over the next three years, supply in key tourist destinations will grow at an average rate of 20 per cent per year.

Moreover, the Vietnamese market currently boasts many projects competing in the same segment with similar models and products. Many developers rather focus on quantity than quality and they build products under a “copy-paste” strategy without determining their own characteristics which could interest buyers.

Resort tourism in Vietnam and the wider Asia-Pacific region have seen positive signals in recent times. According to the Savills Asia-Pacific Resort Market Report published in June, more than $14.9 billion in less than 460 deals was transacted in 2021 in the Asia-Pacific hospitality sector. This figure surpassed the five-year pre-pandemic average of $14.6 billion.

This market also saw an increase in both investment volume and transaction volume in 2021, increasing by 42.1 per cent and 25.8 per cent on-year, respectively.

Especially, investment volume increased to $5 billion in Q1/2022, up 5.3 per cent on-quarter and 86.9 per cent on-year. The report also noted a special trend that more businesses are starting to liquidate non-core assets to recover capital.

Particularly in Vietnam, in coastal locations such as Vung Tau, Danang, Nha Trang, and Phu Quoc, many hotels and resorts recorded impressive recovery rates in attracting domestic customers, with up to 70 per cent capacity this summer.

According to the General Statistics Office, in the first seven months of the year, the domestic market welcomed 71.8 million visitors, exceeding the expected number for the whole of 2022.

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