Hanoi has been assigned to collect over 408 trillion VND (16.8 billion USD) in State budget revenue estimates in 2024, the highest level in the country.

Director of the Hanoi Tax Department Vu Manh Cuong said that the department commits to closely coordinating with other departments, agencies, and districts to strictly implement the directions of the Ministry of Finance, and Hanoi People's Committee regarding State budget collection.

The State budget revenue of Hanoi as of December 28 topped 405.2 trillion VND or 114.8% of the projection, up 23.8% compared to the same period last year, according to the municipal Department of Finance.

In 2023, the Hanoi Tax Department and tax agencies completed about 17,280 inspections, adding neatly 10 trillion VND to the State budget.

Quota for raw tobacco imports set at nearly 72,000 tonnes

Vietnam would import 71,835 tonnes of raw tobacco under tariff quota for 2024 set in a freshly issued circular by the Ministry of Industry and Trade (MoIT).

Raw material import tariff quotas are assigned by the method specified in the Government's Decree No. 69/2018/ND-CP dated May 15, 2018, detailing a number of articles of the Law on Management Foreign Trade, Circular No. 12/2018/TT-BCT dated June 15, 2018 of the MoIT detailing a number of articles of the Law on Foreign Trade Management, and Decree No. 69/2018/ND-CP dated May 15, 2018 of the Government detailing a number of articles of the Law on Foreign Trade Management.

The above quota is allocated to traders who are licensed for producing cigarettes by the MoIT and are in need of raw tobacco for production of cigarettes with a certain percentage of imported raw tobacco certified by the ministry.

Circular No. 39/2023/TT-BCT will take effect from February 22, 2024 to the end of the year.

Central bank urges caution in gold trading

The central bank has warned people to take caution when trading gold amid the strong fluctuations of the precious metal.

Dao Xuan Tuan, Director of the State Bank of Vietnam (SBV)’s Department of Foreign Exchange Management, noted that the bank has prepared measures to stabilise the domestic gold market, referring to the increase of SJC-branded gold bullion supply.

The central bank always closely monitors market developments and is ready to take solutions to stabilise it in order to minimise the impacts of gold price fluctuations on exchange rates, inflation and macroeconomic stability, he affirmed.

It will continue coordinating with the Ministry of Public Security and other relevant ministries and agencies to intensify inspections over gold business, Tuan continued.

The price of gold bullions in Vietnam had skyrocketed over the past weeks, even peaking at 83 million VND (3,419 USD) per tael. The difference between domestic and world gold prices has continuously expanded in recent days, reaching nearly 20 million VND per tael at certain moments.

Given this, Prime Minister Pham Minh Chinh has issued a dispatch asking for measures to strengthen the management of the domestic gold market.

He ordered relevant agencies to work with the SBV to immediately roll out measures to strictly handle violations, especially smuggling, manipulation and speculation, ensuring a stable, transparent, safe, healthy and effective domestic gold market.

Nghi Son refinery company contributes about 820 million USD to State budget in 2023

The Nghi Son Refinery & Petrochemical Limited Liability Company (NSRP) achieved a net revenue of about 6.4 billion USD in 2023 and contributed about 820 million USD to the State budget.

According to General Director of NSRP So Hasegawa, the company has promoted effective governance and achieved significant progress in transformation initiatives, which helped it earn additional 31 million USD in 2021 and 2022, and 118 million USD for 2023. The figure is estimated at 50 million USD per year in the near future.

NSRP also completed the first comprehensive overhaul of its factory within 47 days and nights, 7 days earlier than planned. The success of the maintenance allowed NSRP to increase the plant's capacity by 117%, resulting in increased product quality and output.

In 2023, NSRP successfully produced nearly 7.6 million tonnes of products of all kinds, meeting the production targets.

The company’s initial restructuring has generated positive results, helping increase its productivity, product quality, and output.

PM requests measures to meet payment, cash needs during New Year celebrations

Prime Minister Pham Minh Chinh on December 29 asked the Governor of the State Bank of Vietnam (SBV), the Minister of Finance and the General Director of Vietnam State Treasury to deploy measures to meet payment and cash demands of individuals and firms at year-end, during the coming New Year and Lunar New Year holidays.

Accordingly, the SBV was asked to direct credit institutions to ensure that the payment system will operate stably, safely, and smoothly all the time to meet payment and cash needs through the ATM system before and during the New Year and Lunar New Year.

The provision of payment services of the interbank electronic payment system must be guaranteed too.

The central bank must ensure cash supply to the economy and closely coordinate with competent authorities to strengthen inspections to promptly detect and strictly handle violations in buying and selling foreign currencies/gold or making unlawful money exchanges.

The SBV was asked to direct credit institutions and foreign bank branches to take measures to ensure liquidity and arrange staff to provide stable, safe, and smooth payment services before and during the New Year and Lunar New Year 2024.

They must properly provide foreign exchange services and increase foreign exchange activities to serve the needs of foreign tourists, meet the credit capital needs for production and business development of people and businesses at the year-end and the beginning of 2024.

The State Treasury was required to arrange staff to ensure smooth, timely, and safe disbursement and payment.

The PM urged the Government Office to oversee the agencies’ task performance and report to him issues beyond its authority.

Hanoi’s CPI up 2.04% in 2023

Hanoi’s consumer price index (CPI) in 2023 is estimated to increase 2.04% year-on-year, according to the Hanoi Statistics Office.

Nine of the 11 groups in the commodity basket experienced price hikes, with education services up 5.89%; beverages and tobacco 3.37%; restaurant and catering services 3.12%; housing, electricity, water supply and construction materials 1.85%; apparel, headwear and footwear 1.7%; culture, entertainments and tourism 0.89%; household equipment 0.79%; medicines and medical services 0.33%; and other goods and services 4.69%.

Only two saw price reductions in 2023, including transportation down 1.73%, and post and telecommunication 0.75%.

According to the municipal statistics office, tourism is a key sector that greatly contributed to boosting consumption in the city in 2023.

Hanoi's CPI dropped by 0.1% in December from the previous month and rose by 4.77% compared to December 2022.

Two groups of goods/services had prices fall compared to the previous month, including transportation down 1.73% due to two consecutive gasoline price falls on December 7 and December 14. Meanwhile, the group of housing, electricity, water, fuel, and construction materials decreased by 0.06%.

Central bank requests stricter measures against money laundering

The State Bank of Vietnam (SBV) has issued a document requesting compliance with regulations on money laundering and terrorism financing prevention and control.

Specifically, the SBV asked credit institutions, branches of foreign banks, and businesses trading precious metals and gemstones, including gold trading companies and intermediary payment companies, to adopt a series of measures, such as seriously following regulations in the Anti-Money Laundering Law 2022, the Government’s Decree No. 19/2023/ND-CP dated April 28, 2023, detailing certain provisions of the Anti-Money Laundering Law; the Prime Minister's Decision No. 11/2023/QD-TTg dated April 27, 2023, which outlines the reporting requirements for high-value transactions, and the SBV Governor’s Circular No. 09/2023/TT-NHNN dated July 28, 2023 that guides the enforcement of several articles of the Anti-Money Laundering Law.

In case there are unusual signs concerning clients or transactions, they must report to the Authority for Anti-Money Laundering in accordance with the provisions outlined in Articles 26 to 33 of the Anti-Money Laundering Law 2022.

They must also promptly report and provide relevant information and documents regarding suspicious transactions, while working closely with competent state agencies in line with the law.

Vietnam - favourite destination of Korean tourists in 2023

In the first 11 months of 2023, more than 7.3 million tourists from the Republic of Korea (RoK) visited Vietnam, an increase of 220% compared to the same period last year, according to the RoK’s Ministry of Land, Infrastructure and Transport.

Destinations including Phu Quoc, Da Lat, and Nha Trang are favoured by Korean travelers thanks to reasonable costs and diverse tourism activities.

According to the ministry, during the period, more than 1 million Korean people traveled from the Incheon to Nha Trang – Vietnam’s coastal resort city. In 2019, before the COVID-19 pandemic, the city attracted more than 735,400 Korean visitors.

Meanwhile, the number of Korean visitors to Phu Quoc Island - which is considered "Vietnam's Jeju island", also increased sharply.
In the first 11 months of this year, nearly 300,000 Koreans traveled on the Incheon-Phu Quoc route and more than 61,000 others on the Incheon-Da Lat route.

Korean and Vietnamese airlines also quickly expanded flight networks to meet the demand for travel to emerging destinations in Vietnam.

On December 24, the RoK's Jin Air launched its Phu Quoc-Incheon flights. Earlier this month, Vietnamese budget airline VietJet Air launched a new route from Busan to Phu Quoc island. Low-cost airline Jeju Air has also opened Icheon-Da Lat flights from December 20 with a frequency of seven flights per week, becomingthe first RoK domestic airline operating regular flights to the famous resort city in the Central Highlands province of Lam Dong.

Vietnam has room to develop high-value manufacturing: Cushman & Wakefield

Vietnam’s high-value manufacturing is expected to grow, with the government intent on increasing manufacturing’s share of the economy from 25% to 30% by 2030 by attracting more high-value manufacturing investment, said the “Strength through Diversification: Opportunities across Asia Pacific” report by Cushman & Wakefield.

The global commercial real estate services firm affirmed that Vietnam has the room to accommodate such growth with a strong concentration of electronics production in the northern region (Hanoi, Hai Phong), while the southern region (Ho Chi Minh City, Binh Duong, Dong Nai) has a mix of food, consumer goods and electronics manufacturing.

According to the report, Vietnam is a key beneficiary of China plus manufacturing strategies due to close geographical proximity and wider regional/global connectivity.

Aside from its strategic location, Vietnam remains cost-effective with significantly lower labour costs compared to China. Further benefits come from a balanced mix of high value manufacturing such as electronics and low value manufacturing such as garments, footwear and food.

In its report, Cushman & Wakefield said that the ASEAN bloc is fast establishing itself as a major growth focus within the Asia-Pacific, attracting healthy levels of foreign direct investment which are expected to reach at record peak in 2022 of 223 billion USD.

Much of this growth has come as US- and European-based corporations continue to expand and diversify their operations within the region, though Chinese manufacturers also continue to expand their presence. The northern region of Vietnam, such as Hai Phong and Hanoi, has attracted strong investment from China’s and the Republic of Korea’s manufacturers given its close proximity as well as its strong geographical connectivity regionally and globally, it added.

Japan, Vietnam sign over JPY41 billion loan for HCM City metro project

The Japan International Cooperation Agency (JICA) has just signed an agreement to lend more than JPY41 billion to the Vietnamese Government for the construction of Metro Line No. 1 (Ben Thanh - Suoi Tien section) in Ho Chi Minh City.

This is the fourth loan the Japanese Government has committed to fund the metro line project, following three previous loans in 2007, 2012, and 2016.

Accordingly, the project will contribute to reducing traffic congestion and air pollution, while promoting regional economic growth.

The project will also help Vietnam achieve sustainable development goals, No. 9 (industry, innovation and infrastructure), No. 11 (sustainable cities and communities), and No.13 “Take urgent action to combat climate change and its impacts”.

Ho Chi Minh City’s Metro Line No. 1, also known as the Ben Thanh - Suoi Tien line, is to run nearly 20 km between Ben Thanh market in the downtown area and Long Binh Depot in Thu Duc city.

Construction work commenced in 2012 and the metro line is scheduled for completion in 2024.

Draft decree on investment support fund put up for public comments

The Ministry of Planning and Investment (MPI) has put up for public comments a draft decree on an investment support fund as a solution to attract strategic investment in the context that Vietnam is adopting the Organisation for Economic Cooperation and Development (OECD)’s global minimum tax.

The ministry said that the fund aimed to stabilise the investment climate, encourage and attract strategic investors and multinational enterprises as well as support domestic companies in prioritised sectors.

The finance for the fund would come from the State budget sourced from the collection of top-up taxes and others.

Under the draft, the fund would provide support for enterprises investing in high-tech production, high-tech companies, those with projects applying high technology which have capital scales from 12 trillion VND and a revenue from 20 trillion VND per year.

The fund would also support enterprises investing in a research and development (R&D) centre with a capital of 3,000 trillion VND or higher.

The support would be in cash, to be provided for training and human resource development, investment in fixed assets and social infrastructure system, high-tech product manufacturing, research and development, together with support in credit and interest rates.

The ministry raised two options for the management of the fund, under the Ministry of Finance or under the Ministry of Planning and Investment.

General Secretary of the National Assembly, Chairman of the National Assembly Office Bui Van Cuong was quoted by Dai Bieu Nhan Dan Newspaper that the establishment of this fund would have a positive impact on attracting investments in sectors that Vietnam is encouraging, not only for foreign investors but also domestic investors.

“This is a great initiative, a sensible step demonstrating Vietnam’s flexibility in responding to the global minimum tax,” Tran Van Lam, permanent member of the National Assembly’s Finance and Budget Committee, said.

The National Assembly’s decision to establish the investment support fund would play an important role in consolidating the confidence of foreign investors in Vietnam’s investment environment, promoting new investment and expansion, he said, adding that when the global minimum tax is applied, most of the existing corporate income tax incentives would no longer be valid for companies subject to the global minimum tax.

However, how the fund would be used would need to be studied carefully to ensure fairness, transparency and accordance with common international practices.

Minister of Planning and Investment Nguyen Chi Dung said the establishment of the investment support fund to encourage investments in prioritised sectors was necessary and consistent with the Politburo’s orientation.

He said that investment support policies of Vietnam in response to the global minimum tax must ensure the competitiveness and appeal of the investment climate, appropriateness to the country’s investment attraction orientations, minimal impact on the State budget, fairness among investors, consistency with the global minimum tax rules and OECD’s guidance as well as international treaties to which Vietnam is a member.

The support policies must be feasible and easy to implement, he stressed.

Bac Ninh aims to integrate into regional semiconductor ecosystem

With a business-friendly approach and an open-door policy, the northern province of Bac Ninh has emerged as a key destination for major players in the electronics and semiconductor industry.

This presents both an opportunity and momentum for Bac Ninh province to gradually integrate into the domestic and regional semiconductor ecosystems.

So far, Bac Ninh has successfully attracted prominent names like Amkor Technology and Micro Commercial Components, laying the initial groundwork for the development of a semiconductor ecosystem.

As outlined in its master plan to 2050, Bac Ninh is placing a strong emphasis on the in-depth development of its industrial sector. The objective by 2030 is to prioritise the growth of specific industries, such as electronic equipment, components and parts for aerospace industry, high-tech equipment and pharmaceuticals, and medical industrial equipment. By 2050, it aims to evolve into a high-tech innovation, research and design centre in Southeast Asia.

To such end, the province will continue leveraging its existing advantages and sustain the electronics sector as the primary driving force of industrial development. Special attention will be paid to high-value segments, specifically in the production of high-tech items such as smartphones and wearable devices.

Human resources development takes the centre stage, with a 50% tuition fee support for students majoring in high-tech disciplines.

With about 30 universities, colleges, vocational schools and 40 high schools, coupled with its close proximity to major universities in Hanoi, Bac Ninh is well-positioned to attract a substantial number of quality workers, experts said.  

Permanent Vice Chairman of the provincial People's Committee Vuong Quoc Tuan said in the semiconductor industry, Bac Ninh boasts the largest-scale industrial infrastructure in the North, positioning itself to become a hub of innovative research and technology transfer. The province considers this an opportunity and is carefully preparing to attract foreign capital effectively. In this way, it will draw attention to projects that play a crucial role in the global semiconductor supply chain.

At present, the province is hastening the construction of a concentrated information technology area covering over 260ha, employing about 20,000 people. It is developing infrastructure to position itself as a hub of electronics, components, and semiconductor manufacturing in the northern midland and mountainous region, as well as the greater Hanoi Capital Region.

With clear-cut strategies and objectives, Bac Ninh is recognised by many experts as gradually expanding its supply and production chains, aiming to become the focal point of Vietnam's semiconductor industry and a crucial link in the global value chain.

HCM City tourism sees outstanding achievements in 2023

Ho Chi Minh City continues to be the leading locality in the country in terms of the number of visitors and revenue from tourism, with nearly 5 million foreign and nearly 35 million domestic tourists, and a total revenue of over VND160 trillion (US$6.6 billion), the municipal Tourism Department announced on December 28.

The department’s Deputy Director Le Truong Hien Hoa attributed the results to the efficiency of the city’s policy to solve difficulties and boost tourism recovery and development.

Notably, the city won “Asia's Leading Business Travel Destination” and “Asia's Leading Festival & Event Destination” awards at the 2023 World Travel Awards.

In the year, the city has announced nearly 50 tourism projects, with 20 new ones for medium- and high-class segments.

The highlight of the year is the first Ho Chi Minh City River Festival. The three-day event contributed to preserving and promoting the city’s culture and history, and making use of its waterways to boost the economy and tourism, in order to build its brand as a culturally rich riverside urban area.

The city's tourism industry has proactively boosted digital transformation and participated in the fourth Industrial Revolution, with a goal of forming a smart tourism ecosystem that connects tourists, service providers and state management agencies. Notably, the city held a tourism digital transformation day with 13 localities in the Mekong Delta region.

In addition, the sector has proactively implemented 13 tourism promotion programmes in Germany, Australia, Portugal, Cambodia, Thailand, Laos, the US, Singapore, Mexico, Argentina, Japan, South Africa and the United Arab Emirates (UAE).

Hoa shared that the city will carry out a lot of activities on the occasion of the New Year and Lunar New Year (Tet) holidays to serve local people and visitors.

Notably, the headquarters of the municipal People's Committee and People's Council will be open to visitors on December 30 - 31, from 8:00 a.m. to 5:40 p.m.

Countdown programmes and firework displays will be organised in various places, together with a Vietnamese Tet festival from January 18-21, 2024, and Nguyen Hue flower street.

On the New Year holidays, the city also plans to organise a marathon race, a martial arts festival, and a bicycle racing tournament.

Sustained macro-economic stability critical to growth target realisation

Amid global uncertainties, the continued maintenance of macro-economic stability will form an important foundation for Vietnam to achieve next year’s growth target, said General Director of the General Statistics Office (GSO) Nguyen Thi Huong.  

In an interview granted to the Vietnam News Agency, she highlighted the positive trend in the country’s socio-economic situation in 2023 as seen in macro-economic stability, controlled inflation, guaranteed major balances, and many areas reaching set targets, making Vietnam a silver lining in the economic situation in the region and the world.

Despite global economic uncertainties, the Vietnamese economy has still maintained growth this year, with improvements recorded quarter over quarter – 3.41% in Q1, 4.25% in Q2, 5.47% in Q3, and 6.72% in Q4. As a result, the gross domestic product (GDP) in 2023 has increased 5.05% compared to 2022, she noted.

Meanwhile, latent risks posed by the global economy are predicted to remain in 2024 and continue negatively affecting the recovery prospect of Vietnam’s economy.

In the country, traditional impetuses are still weak while new ones remain unclear. Therefore, the economy is forecast to continue facing an array of difficulties and challenges next year. Impact from the world’s economic downturn since the COVID-19 pandemic will also keep affecting the Vietnamese economy, at least during the first half of 2024 before more positive signs are recorded, Huong analysed.

The official held that growth drivers for next year include the continued expansion of the agro-forestry-fishery sector; public investment, especially in infrastructure; foreign direct investment (FDI) attraction; and the service sector, which will be boosted by strong tourism recovery.

Other impetuses include trade and domestic consumption promotion policies that will help maintain growth in such sectors as air transport, wholesaling and retailing, accommodation, hospitality, financial, and tourism services.

Besides, the maintained stability of non-market services, inflation kept at a reasonable level, industrial and employment recovery, and salary reform will also support domestic consumption, she opined.

The official went on to say that as 2024 is crucial for the realisation of the economic targets for 2021 - 2025, the Government, ministries, sectors, and localities will exert all-out efforts. Amid global uncertainties, the continued maintenance of macro-economic stability will provide an important foundation for Vietnam to achieve next year’s growth target.

To reach growth targets for each quarter and the entire 2024, she held that it is necessary to keep economic, political, and social stability to enhance investors’ trust, properly control inflation, bring into play fiscal and monetary policies to facilitate businesses’ credit access, step up public investment, and tackle bottlenecks for the land, real estate, construction, tourism, and capital markets.

Huong also pointed out the need to cut or extend payment deadlines for taxes and fees, assist companies to seek new markets and make use of the signed free trade agreements, accelerate the negotiation and signing of new deals, and promote administrative procedure reform to create a favourable business environment.

Effectively implementing domestic trade promotion programmes, distributing goods via digital platforms, encouraging Vietnamese people to prioritise Vietnamese goods, modernising distribution systems in rural and mountainous areas, and stimulating domestic consumption demand are also important to fostering growth, according to the GSO leader.

Enormous challenges for fisheries industry as export markets shrink

2023 proved to be a difficult year for Vietnamese seafood industry due to global high inflation, the prolonged Russia-Ukraine conflict, and instability in the Middle East, according to insiders.      

These challenges prompted global consumers to tighten their belt, leading to a sharp fall in the number of aquatic export orders.

2023 saw seafood export turnover stand at an estimated US$9.2 billion, meeting 92% of the set plan of US$10 billion. Of the overall figure, shrimp, pangasius, mollusk, and tuna exports hit about U$3.45 billion, US$1.9 billion, US$0.8 billion and US$0.9 billion, respectively.

Tran Dinh Luan, general director of the Department of Fisheries under the Ministry of Agriculture and Rural Development, emphasised that apart from external factors, the industry also confronted with challenges related to environmental issues and trade barriers.

Furthermore, the prices of input materials for aquaculture development remained high, while high logistics costs put pressure on farming and processing, especially amid consumption demand slowing and production scale shrinking.

Notably, the European Commission continued to maintain a yellow card warning for Vietnamese seafood products, dealing a heavy blow to seafood exports to the lucrative market.

Despite enduring numerous difficulties, the fisheries industry achieved positive results throughout the year, with total seafood production estimated at 9.269 million tonnes, up 2% year on year.

Tran Gia Long, deputy director of the Planning Department under the Ministry of Agriculture and Rural Development, pointed to the fact that the fisheries industry still maintained a positive growth rate compared to many other fields.

This year saw the overall growth rate of the agricultural industry stand at an estimated figure of between 3.5% and 3.6%, Long added.

According to the Department of Fisheries, moving into 2024 will continue to see challenges for the fisheries industry due to a decline in seafood resources and security situation at sea becoming more unpredictable.

In addition, regional countries are expected to continue to keep their tight control on exploitation activities at sea, causing fishermen's fishing grounds to shrink significantly.

Moreover, the import demand is likely to show no signs of recovery, largely due to tough competition occurring in export markets and high inventory levels of processing and exporting enterprises.

Deputy Minister of Agriculture and Rural Development Phung Duc Tien requested that the fisheries industry next year move to devise appropriate solutions for production activities and encourage the involvement of businesses in the linkage chain to share risks.

He also underlined the need to develop a green seafood industry, which is an irreversible trend in the world.

Moving forward to 2024, the fisheries industry is targeting total seafood output of 9.22 million tonnes, equivalent to 2023, with seafood export turnover reaching about US$9.5 billion, up 3% compared to the set plan for the year.

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