Deputy Minister of Information and Communications Nguyen Huy Dung urged enterprises to speed up digital transformation as it is essential for business growth.

Dung was speaking on Monday at “Vietnam DX Day 2020”, a two-day event organised by the Viet Nam Software and IT Services (Vinasa) and Authority of Information Technology Application, starting from 2020.

DX Day was a bold effort to promote the digital transformation in Viet Nam and for enterprises to promote the participation of Vietnamese firms in the global technology value chains. On June 3, 2020, Prime Minister Nguyen Xuan Phuc approved the national digital transformation programme to 2025 and 2020 was selected to be the year for national digital transformation.

Dung stressed that digital transformation was successful only when the progress attracted the participation of the entire population, meaning that digital technology services as well as network security must be universal with reasonable prices, easy to use and convenient for everyone.

He urged every agency, organisation and business to raise strategies to implement and speed up digital transformation, adding that Vietnamese digital technology companies were the main force in developing the digital infrastructure, platforms, services and solutions as well as mastering core technologies and extending global reach.

According to Tran Tho Dat, President of the National Economics University, digital economy was very important to productivity and efficiency of the economy in the coming years and motivation for rapid improvement in labour productivity.

Tho said that it was necessary to develop an appropriate legal framework, create favourable conditions for investment in digital infrastructure and services, providing support to start-ups, and encouraging innovation and technology improvements to increase the preparedness towards digital technology era.

In addition, it was necessary to encourage the application of digitalisation in every sector, like manufacturing, ICT, science and technology, finance, banking, insurance and real estate.

Of note, it was important to ensure information security to facilitate the digital economy, he said.

Hoang Viet Anh, FPT deputy general director in charge of digital transformation, said this would continue to be an important trend, even when the pandemic was over.

He said: “During the toughest and most challenging times, technology is the key to opening up opportunities for growth, operation optimising, improving customer experiences and creating new business models.”

In the new normal, the digital transformation would bring bigger effects, which would enable enterprises to play the critical role in shaping new realities, he said, stressing that FPT pledged to accompany the Government and enterprises in digital transformation.

According to Huawei, investment in ICT infrastructure would be best for future prosperity, citing the International Telecommunication Union’s figures that an increase of one per cent in the digital ecosystem development index for any country resulted in 0.13 per cent growth in GDP per capita.

The most digitalised countries would recover more quickly from the pandemic, said Andrew Edward Williamson Vice President Global Government Affairs and Economic Adviser, Huawei Technologies Co Ltd.

He also pointed out that joined-up government and full cooperation with the private sector looked to be the best way of ensuring the greatest digital dividends.

According to Chairman of Vinasa Truong Gia Binh, vision and determination will be needed to decide the success of digital transformation.

Binh said: “Raising awareness is the story we have already talked about a lot but where should we start? It is the vision from which we can draw a roadmap for what and how to do. Then it is the determination to drive us forward to success.”

Within the framework of Vietnam DX Day 2020, experts also discuss digital transformation on finance and banking, manufacturing, agriculture, logistics, healthcare and small and medium-sized enterprises.

Viet Nam’s IT industry saw significant developments in recent years, becoming an important infrastructure for socio-economic development and base for enhancing national competitiveness.

The Ministry of Information and Communications’ statistics showed that the IT industry earned estimated revenue of US$100 billion in 2019, equivalent to one third of the country’s GDP and had a workforce of around one million.

Viet Nam’s digital economy was projected at $43 billion by 2025, of which the fastest growth included e-commerce, online travel, online media and ride hailing, according to a report by Google and Temasek.

A survey of Vinasa carried out with more than 500 participant enterprises at DX Day found that the most challenging factors in digital transformation included determination; cost, time and resources; and methods of digital transformation, as well as information security. 

International machinery, supporting industry fairs open in HCM City

Five exhibitions - the Vietnam International Machinery Fair,  Vietnam Supporting Industry Fair, Vietnam International Retailtech and Franchise Show, Vietnam International Premium Products Fair, and Vietnam International Maternity Baby and Kids Fair - opened in HCM City on December 17.

Nguyen Phuong Dong, deputy director of the city's Department of Industry and Trade, said the Vietnam International Machinery Fair and the Vietnam Supporting Industry Fair have around 250 booths set up by local and foreign firms based in Vietnam.

On display are supporting industry products, metal products and metalworking solutions, automation solutions and motion control systems, industrial materials and components, electrical equipment, construction machinery, and lifting equipment.

The fairs will also feature other events like a workshop on opportunities to welcome a new investment wave by Vietnamese enterprises post COVID-19 and business matching activities.

“Organising the fairs amid the COVID-19 pandemic is an effort … to help strengthen linkages between Vietnam’s supporting industry firms and product manufacturers and foreign firms, and enable local firms to grab opportunities to expand market share in both domestic and foreign markets,” Dong said.

Ahn Seong Ho, the consul general of the Republic of Korea in HCM City, said the exhibitions offer a good opportunity for both Korean and Vietnamese companies to understand consumers’ demand, catch up on market trends and enhance cooperation.

Bui Thi Thanh An, deputy head of the Vietnam Trade Promotion Agency under the Ministry of Industry and Trade, said, “The fairs offer a good chance for local supporting industries firms to access advanced global technologies and innovation to enhance their production capacity and productivity, which will help them join global supply chains.”

Organised by the city's Supporting Industry Development Centre, the Korea Association of Machinery Industry, Coex Vietnam, and the HCM City Association of Mechanical – Electrical Enterprises, the fairs will run at the Saigon Exhibition and Convention Centre in District 7 through December 19./. 

Long An province leads Mekong Delta in economic growth

Located in the Southern Key Economic Region and a gateway to the Mekong Delta, Long An province possesses remarkable advantages to develop its economy. Its potential has already been tapped by local authorities, resulting in exponential economic growth.
 
State budget collections in Long An exceeded 10,000 billion VND for the first time ever in 2017, marking an important milestone in its economic development, as exponential growth has been posted ever since. The province estimates that budget collections for this year will amount to nearly 16,900 billion VND. Long An is now a foreign investment magnet in the region, with nearly 1,100 FDI projects and total capital of over 6.6 billion USD.

It has also set a target of maintaining its leading position in the Mekong Delta region in terms of economic growth to 2025 and being among the best-developed provinces in the Southern Key Economic Region by 2030.

Its encouraging achievements can be attributed to the efforts of local authorities to improve the business climate, especially via administrative reforms.

Long An has set a target of posting annual economic growth of 9.2 to 10% in the 2012-2025 period, and for per capita gross regional domestic product (GRDP) to stand at over 5,100 USD by 2025.

Given the determination of local people and authorities, Long An is certain to become an attractive destination for investors in the future./.

Viet Nam – South America logistics trade forum held

The online Viet Nam – South America logistics trade forum has been held to help the two countries' firms expand business co-operation opportunities in the field.

Speaking at the event, deputy head of the Ministry of Industry and Trade (MoIT)’s Viet Nam Trade Promotion Agency Le Hoang Tai said South America is a promising market for Viet Nam’s exports such as apparel, leather and footwear, handicraft, aquatic products and processed food. However, its export turnover remains limited.

Recently, both sides have faced difficulties in trade due to the COVID-19 pandemic. Moreover, distance and limited transportation of goods also resulted in high logistics cost, making it hard for Vietnamese goods to compete with rivals.

Logistics firms also faced barriers related to language, cultural differences and access to market information, he said.

Vice General Secretary of the Viet Nam Logistics Business Association Nguyen Tuong said Viet Nam’s logistics sector was undergoing a digital transformation to meet development demand following the pandemic.

He proposed enterprises meet together or via agents to learn about information related to the market and demand. Embassies should also hold trade promotion trips to support them.

CEO of the Empresas Taylor Company Matthew Taylor Pollmann suggested Vietnamese logistics firms join projects on technological transformation, adoption of artificial intelligence in logistics, or switch to green energy in Chile.

Tai added that the MoIT is reviewing administrative procedures to create favourable conditions for export and logistics firms.

The ministry should also encourage logistics companies to invest in infrastructure and digitalise operations to improve competitiveness, he said. 

Local businesses must understand civil contract law: experts

Complicated laws relating to production and business activities require enterprises to study basic provisions of the laws, especially rights and obligations in contract transactions, according to Nguyen Thanh Tu, head of the Ministry of Justice’s Department of Civil and Economic Laws.

Contract law is very important for businesses and also the economy.

The 2015 Civil Code included breakthrough changes but has not yet met the requirements of legal document renovation. Meanwhile, there are a large number of legal documents on governing civil contracts in many fields, he said. Understanding and applying those legal documents in production and business activities are not easy for enterprises.

This has forced enterprises to understand the basic provisions of laws relating to business, including rights and obligations in contracts. They also need to pay attention to the regulations relating to risks in the process of establishing and implementing contracts, he said.

The Viet Nam Chamber of Commerce and Industry (VCCI) in coordination with the Ministry of Justice held a forum on December 11 in Ha Noi to find solutions to remove difficulties businesses face in enforcing various types of contracts and settling business disputes, said Dau Anh Tuan, head of the VCCI’s Legal Department.

This is one of the activities to complete laws on implementing contracts and resolving disputes by commercial arbitration and mediation according to the Prime Minister’s requirement.

According to Tran Huu Huynh, chairman of the Viet Nam International Arbitration Center (VIAC), in Viet Nam, the available methods of resolving commercial contract disputes include mediation, arbitration and court proceedings. Each method has advantages and disadvantages, depending on the choice of the parties in the contract.

In addition, the enterprises should pay attention to disputes between suppliers of goods and services and consumers. The term of arbitration has been recognised in the general conditions of supplying goods or services issued by the suppliers but consumers still have the right to choose an arbitrator or a court to resolve commercial disputes.

Therefore, enterprises needed to study carefully and choose the dispute settlement method that is suitable, Huynh said.

Local firms urged to adopt ESG principles for further growth 
 
It is undeniable that adopting environment, society and governance (ESG) principles is helping local companies improve business management and attract more foreign capital.

Investment assets, which are sustainable and managed by sustainability-striving organisations have kept growing steadily amid the volatility of the global financial markets.

According to the US-based Forum for Sustainable and Responsible Investment (US SIF Foundation), the total value of sustainable assets in November soared 42 per cent to US$17.1 trillion from $12 trillion at the beginning of the year.

Around $16.6 trillion worth of assets was overseen by investment funds, personal asset managers, institutional investors and public investment funds who use ESG principles as one of the key factors when evaluating the assets.

The rest of the assets were owned by the organisations that evaluate the companies’ shares on their adaptability to ESG principles before buying the shares.

Nowadays, interest in ESG-related assets is rising among individual investors. A recent Morgan Stanley survey showed 85 per cent of American individual investors were more interested in sustainable investment, up 10 percentage points on-year.

US SIF also found asset managers and wealthy investors had the best interest in how environmental issues – such as climate change, carbon emissions and clean energy – would be dealt with.

In Britain, 36 per cent of all 277 bond and stock investments in January-November 2020 adopted sustainable investment policies and purchased ESG-related assets. The figure was up from 19 per cent from 2019.

According to Tom Galvin, director of investment fund Columbia Select Large Cap Growth, ESG principles are one of the decisive factors in making investment as good financially-governed companies also make sure of sustained business development and high responsibility.

According to SSI Securities Corp’s research unit, ESG-related investment funds lured a total of $120 billion worldwide in January-October.

The global crisis caused by the COVID-19 pandemic and other natural disasters has emphasised the importance of how companies handle ESG issues.

According to market members and securities firms, investing in ESG-related assets brings less risk and higher profit in the long term, especially when climate change issues are getting more serious.

Viet Nam’s partnership with other nations and economic blocs, for example the European Union-Viet Nam Free Trade Agreement, has motivated local companies to pay more attention to ESG issues to draw attention from foreign investors.

Viet Nam Holding has already invested in the Viet Nam Dairy Products JSC (Vinamilk) and tech group FPT Corporation as the fund has faith in the companies’ high quality of corporate governance and sustainable development policy.

Dragon Capital said the fund accepted to lose 20 per cent of investment opportunities when asking firms for ESG scoring and import criteria on environmental protection and climate change response into their business portfolios.

The fund’s executive chairman Dominic Scriven said environmental issues were not the biggest concerns at local companies while governance and social issues were often highly attended, tinnhanhchungkhoan.vn reported.

Jennie C Ahren, head of ESG unit at Tundra Sustainable Frontier, said there was still room for improvement among Vietnamese companies regarding their efforts in environmental protection, social responsibility and corporate governance.

Compared to other nations on the same level of socio-economic conditions, education activities in Viet Nam were much more outstanding while interests from foreign investors would also strengthen the conditions on environment, transparency and labour.

A report by the Ho Chi Minh Stock Exchange (HoSE) in August pointed out that local companies understanding and adopting ESG principles had a higher ability to bounce back during the COVID-19 crisis.

To get higher ESG scores, local companies should audit their supply chains, the compliance of employees and the quality of internal operations and make adjustments if needed, according to Rachael Johnson, Head of Risk Management and Corporate Governance for Professional Insights at ACCA.

The audit will provide detailed information about the suppliers to help local firms get through the rough times such as the COVID-19 pandemic.

Pandemic takes toll on Vietnam’s exports to Israel: trade office

The COVID-19 pandemic and political developments in Israel has partly affected Vietnam’s exports to this market, according to Vietnam’s trade office in Israel.

Vietnamese Commercial Counsellor in Israel Le Thai Hoa said Vietnam recorded over 650 million USD in exports to and about 750 million USD in imports from Israel during January – November.

The trade office forecast the whole-year figures at some 700 million USD and 800 million USD respectively, resulting in a trade deficit of about 100 million USD with Israel.

In October alone, bilateral trade reached 136.02 million USD, with Vietnam’s shipments down 16.3 percent month on month to 40.14 million USD while imports surging 62.1 percent to 95.88 million USD.

The same trend was seen during the 10 months, Hoa noted, adding that exports to Israel fell 11.6 percent year on year to 574.21 million USD but imports shot up 188.6 percent to 717.01 million USD.

The surge of Vietnam’s imports is attributed to the purchase of computers, electronic products and components, which have high value, from Israel, leading to a deficit of 142.8 million USD during the 10 months, he said.

Despite a population of only around 9.3 million, Israel is currently the third largest Middle Eastern export market of Vietnam, following the UAE and Turkey./.

Singapore, US ink MoU on trade financing, investment cooperation

Singapore and the US have signed a Memorandum of Understanding (MoU) to deepen economic cooperation and extend trade financing and investment support to companies in Singapore and the US.

The MoU was signed by Singapore Minister for Trade and Industry Chan Chun Sing, and Secretary of Commerce Wilbur Ross, the US Department of Commerce said in a press release.

The US is Singapore's largest foreign investor, while Singapore is the fourth largest Asian investor in the US.

“This MoU will help Singapore importers finance the purchase of US exports and support Singapore investors looking at opportunities in the US,” Secretary Ross said.

Minister Chan said as like-minded partners, Singapore and the US are committed to supporting their businesses as they respond to the global economic disruptions caused by COVID-19.

Last week, Singapore also signed a trade agreement with the UK./.

Prioritising the development of supporting industries

The development of supporting industries has consistently been considered one of Vietnam’s top-priority policies in recent years, contributing to promoting the development of the industry and accelerating the process of national industrialisation and modernisation.

Vietnam’s supporting industries have been increasingly growing and gradually participating in the global supply and value chains. However, according to experts, the current development of Vietnam’s supporting industries has yet to match its potential.

Specifically, the supporting industrial products manufactured domestically are not diverse in types, designs or patterns, alongside low quality and high prices. In addition, the scale and competitiveness of Vietnamese supporting industrial enterprises remains limited, leaving them without enough strength to participate more deeply in the global production and supply chains.

Meanwhile, the country’s technology capability has still not yet caught up with that of others in the region, which has caused the localisation rate of industries to remain low. Many of Vietnam’s strength industries, such as electronics, garments & textiles, leather & footwear, automobiles and motorbikes, are still heavily dependent on imported raw materials, making production both passive and costly.

The Government recently issued Resolution No. 115/NQ-CP mapping out many important solutions to promote the development of supporting industries.

The resolution stresses the need to build, complete and effectively and synchronously implement specific mechanisms and policies to develop supporting industries, as well as effectively arranging and mobilising resources for the implementation of these policies.

In addition, it proposes continuing to implement interest rate incentives for supporting industrial enterprises and the manufacturing industry, while forming and developing domestic value chains through effectively attracting investment and promoting linkages between Vietnamese firms and multinational ones.

Other solutions include the building of concentrated supporting industrial parks to foster sectoral linkage clusters, as well as the development of material industries to increase self-reliance in terms of raw materials for production, reduce dependence on imported sources, and improve the domestic added value and the competitiveness of Vietnamese products in global value chains.

To strengthen the capability of supporting industrial businesses, it is necessary to build and effectively operate technical centres assisting regional and local industrial development, aimed at enabling supporting industrial enterprises to prioritise innovation, research & development (R&D), and technology transfer, while improving productivity, product quality and competitiveness, thus creating opportunities to deeply participate in the global production chains.

In addition, priority will be given to designing preferential support mechanisms and policies in terms of finance and infrastructure, and to improving the capabilities of technical centres assisting regional industrial development. These centres are tasked with connecting local centres to form a general ecosystem of technology and industrial production.

The aforementioned solutions, if implemented effectively, will surely create a breakthrough for supporting industries in the coming time, contributing to realising the goal set in Resolution 115/NQ-CP that by 2030, supporting industrial products will meet 70% of the demand for domestic production and consumption, while accounting for about 14% of industrial production value.

Local exporters allowed to use S.Korean fabric for exports to EU

A provision in an agreement between South Korea and Vietnam has enabled Vietnamese exporters to use South Korean fabric for local textiles and garments exported to the European Union (EU) while still enjoying tariff incentives under the EU-Vietnam Free Trade Agreement (EVFTA).

The agreement on the combined textile origin was signed at the 10th meeting of the Vietnam-Korea Joint Committee on Energy, Industry and Trade Cooperation and the fourth meeting of the Joint Committee on the implementation of the Vietnam-Korea Free Trade Agreement, which were co-chaired by Vietnamese Minister of Industry and Trade Tran Tuan Anh and South Korean Minister of Trade, Industry and Energy Sung Yunmo last Friday, December 11.

The deal is significant to help local businesses easily access high-quality textile materials from South Korea to make and ship products to the EU.

The EU needs to import garment and textile products worth over US$250 billion each year. In 2019, Vietnam exported textiles and garments worth US$4.3 billion to the EU, accounting for only 2% of the share in this potential market.

With the EVFTA taking effect from this August, economic experts forecast that the local textile and garment industry would increase its shipments to the bloc by some 67% by 2025 as compared to the scenario without the trade deal.

However, according to the commitments of the pact, aside from meeting strict quality criteria, local firms must implement strict origin requirements to enjoy preferential tariffs. Specifically, exports to the EU must use fabric produced in Vietnam or in EU member countries. The agreement, however, also allows exporters to use fabric from countries that have FTAs with both Vietnam and the EU.

This remains a weakness for the local industry as the majority of raw materials are imported from countries that have not signed FTAs with the EU.

To cope with this weakness, Vietnam negotiated with the EU countries on rules of origin, allowing local exporters to use fabric made by a third-party country that has an FTA with the EU such as South Korea.

Before the EVFTA came into effect, the Vietnamese Ministry of Industry and Trade and the South Korean Ministry of Trade, Industry and Energy had started negotiations to implement the combined origin rules under the EVFTA.

Kien Giang enjoys over 10 percent rise in aquatic production

The total aquatic catching and production of the Mekong Delta province of Kien Giang fetched 836,175 tones in 2020, surpassing the yearly target by 10.75 percent, according to a local official.

Quang Trong Thao, Vice Director of the provincial Department of Agriculture and Rural Development, said that the catching volume exceeded 572,000 tonnes, while the output of aquaculture is 264,105 tonnes.

Notably, the province produced 92,490 tonnes of shrimp in the year, up 11.7 percent year on year.

He said that the province is re-organising its fishing activities towards reducing small vessels and increasing large capacity fleet.

Meanwhile, the province has focused on transferring aquatic farming technology to farmers, especially in shrimp breeding, while applying Semi-biofloc and Biofloc technologies in shrimp farming, thus raising the productivity from 10-12 tonnes per hectare to 30-50 tonnes per hectare.

The province will expand industrial shrimp farming areas, especially in the Long Xuyen
quadrilateral area, while switching ineffective rice fields to the model of shrimp-rice farming.

Along with the improvement of infrastructure system, the province will work to enhance the quality of varieties, feed and disease control in aquatic farming, said Thao.

He added that Kien Giang will also support fishermen to promote efficiency of fishing activities in parallel with guiding them on the preservation of fishery resources, while rolling out measures to prevent illegal, unreported and unregulated fishing (IUU) in line with the recommendations of the European Commission (EC)./.

Binh Phuoc calls for RoK investment in high-tech parks

The authorities of the southern province of Binh Phuoc on December 16 held a virtual investment promotion conference with enterprises from the Republic of Korea (RoK).

At the conference, a number of veteran RoK investors in the province including HCM Vina and Hankuk Carbon introduced the local business environment and incentives for their compatriots who want to know more about Binh Phuoc’s transport infrastructure and regulations on construction and the employment of labours.

Tran Tue Hien, Chairwoman of the provincial People’s Committee, said with an open business environment, preferential policies, and time-saving administrative procedures, Binh Phuoc is emerging as an attractive destination for foreign investors, especially those from the RoK.

In 2020, Binh Phuoc attracted 36 FDI projects worth 432 million USD. To date, the province has lured 272 FDI projects whose capital amounted to 2.7 billion USD. Of the total, 90 projects worth 664 million USD are from the RoK, making it the largest foreign investor in the province.

Hien called for RoK’s investment in a series of sectors like electronics, farm produce processing, support industry, and high-tech agriculture.

The local leader vowed to offer the best conditions possible for investors’ production and business operations regarding land clearance, administrative procedures, infrastructure, and policies.

Currently, Binh Phuoc has 13 industrial parks spanning a total of 4,686 ha./.

Cafe Amazon to open second Vietnamese location in HCM City

Coffee chain Cafe Amazon, which has over 3,500 branches throughout Thailand, is scheduled to open its second store on Phan Xich Long street in Phu Nhuan district of Ho Chi Minh City, Radio the Voice of Vietnam (VOV) reported.

Along with its popular menus which features beverages such as Mocha, Latte, and Amazon Signature, the Vietnamese store will also launch new products that are suitable for the tastes of local consumers, including iced black coffee, iced white coffee, and special iced white coffee.

According to a report published by the Bangkok Post, after first being established in 2001, Cafe Amazon initially started as a PTT retail business at petrol and gas stations.

Now, each Café Amazon covers an area of between 40m2 and 200m2, with some 85 percent of expansions coming from opening new franchises. The rest will therefore be from PTT Oil and Retail Business Plc, an arm of national oil and gas conglomerate PTT's own investment, in addition to joint ventures alongside local partners.

PTT's retail arm has moved to establish a joint venture with Central Restaurants Group in order to operate the Café Amazon brand in the nation, investing a total of 3.5 million USD.

Of the figure, PTT owns a 60 percent share, whilst the rest is held by the Central Group.

The launch of the location in Ho Chi Minh City comes following the first Cafe Amazon being opened at the BigC Go! shopping center in Ben Tre province.

Kien Giang enjoys over 10 percent rise in aquatic production

The total aquatic catching and production of the Mekong Delta province of Kien Giang fetched 836,175 tones in 2020, surpassing the yearly target by 10.75 percent, according to a local official.

Quang Trong Thao, Vice Director of the provincial Department of Agriculture and Rural Development, said that the catching volume exceeded 572,000 tonnes, while the output of aquaculture is 264,105 tonnes.

Notably, the province produced 92,490 tonnes of shrimp in the year, up 11.7 percent year on year.

He said that the province is re-organising its fishing activities towards reducing small vessels and increasing large capacity fleet.

Meanwhile, the province has focused on transferring aquatic farming technology to farmers, especially in shrimp breeding, while applying Semi-biofloc and Biofloc technologies in shrimp farming, thus raising the productivity from 10-12 tonnes per hectare to 30-50 tonnes per hectare.

The province will expand industrial shrimp farming areas, especially in the Long Xuyen
quadrilateral area, while switching ineffective rice fields to the model of shrimp-rice farming.

Along with the improvement of infrastructure system, the province will work to enhance the quality of varieties, feed and disease control in aquatic farming, said Thao.

He added that Kien Giang will also support fishermen to promote efficiency of fishing activities in parallel with guiding them on the preservation of fishery resources, while rolling out measures to prevent illegal, unreported and unregulated fishing (IUU) in line with the recommendations of the European Commission (EC)./.

Ca Mau looks to attract capital flows into key projects

The Mekong Delta province of Ca Mau is calling for investment in technical infrastructure development, especially in key projects, with the aim of creating impetus for its socio-economic development.

Local authorities are focusing on attracting investment in a seaport complex on Hon Khoai Island, a non-tariff area and a finance and trade centre at the Nam Can Economic Zone, and a tourism project on Mui Ca Mau (Ca Mau Cape).

They are also giving priority to luring capital to hi-tech agricultural projects, towards promoting exports to the European market under the EU-Vietnam Free Trade Agreement.

Ca Mau has been developing the Khanh An and Hoa Trung Industrial Parks (IPs) and the Nam Can Economic Zone, while seeking government approval for the establishment of the Song Doc IP.

As of early December, the Khanh An IP had attracted 20 investment projects relating to gas treatment, construction materials, wood production, and packaging. These have all been implemented on schedule as committed.

Vice Chairman of the provincial People’s Committee Lam Van Bi said that in the next five years, the province will pay due regard to making its investment and business environment more transparent, open, and competitive.

It will continue to call for investment in hi-tech agriculture production, sustainable development, environmental protection, maritime economic development, renewable energy, and tourism, he went on.

Ca Mau is home to 10 foreign-invested projects with total registered capital of over 393 million USD and 343 domestic projects with over 121.9 trillion VND (5.2 billion USD).

Of note, it has attracted 188 domestic projects in the last five years with registered capital of over 50.3 trillion VND, up 75 percent in project number and 21 percent in capital compared to the figure reported for the 2011-2015 period./.

Export target of over 41 billion USD within reach: Agricultural sector

Though COVID-19 has hampered exports, the agricultural sector remains confident of achieving this year’s export target of over 41 billion USD.

The coronavirus outbreak created obstacles to production and trade. Severe natural disasters such as drought and saltwater intrusion, especially in the Mekong Delta, along with plant and animal diseases posed further challenges to the sector this year.

Most key agricultural exports posted declines in the early months of 2020.

Facing that fact, the agricultural sector has conducted policies flexibly in order to fulfil export targets, Minister of Agriculture and Rural Development Nguyen Xuan Cuong said, noting that it has made use of every possible opportunity in all markets.

Thanks to that, agro-forestry-fishery exports are forecast to surpass the targeted 41 billion USD this year. Exports to nearly 200 markets, including large markets such as the US, the EU, Japan, and China, earned Vietnam second place in Southeast Asia and 15th in the world in terms of agro-forestry-fishery exports, he said.

The sector has also managed to pave the way for different fruit to enter new markets, like fresh lychee in Japan and pomelo in Chile.

Notably, he said, rice continues to record strong increases in exports. The Mekong Delta, the largest agricultural hub in Vietnam, reaped a bumper rice harvest despite the historic drought, thanks to crop rescheduling. Surging food demand amid COVID-19 also provided Vietnam with the opportunity to boost rice exports.

Strong demand from a host of markets fuelled rising export prices for Vietnamese husked rice, which are now around 500 USD per tonne. Free trade deals, especially the EU-Vietnam Free Trade Agreement (EVFTA), have also opened up more opportunities for the commodity.

Deputy Minister Phung Duc Tien said that as soon as the Prime Minister approved the EVFTA implementation plan, the ministry built an action programme for the agricultural sector.

As a result, right from the first month the trade pact took effect, in August, shipments of agro-forestry-fishery products to the EU grew 15-17 percent against a year earlier, he said, adding that the sector has maintained its focus on traditional markets like China, the US, and Japan.

Wood product exports have continually accounted for some 30 percent of the agricultural sector’s total overseas shipments but were not immune from the impact of the COVID-19 pandemic.

Chairman of the Vietnam Timber and Forest Product Association (VIFOREST), Do Xuan Lap, said businesses have strived to seek new ways in the face of the pandemic’s complex developments.

Not only selling products directly to consumers or promoting goods at fairs, enterprises have also swiftly moved to online platforms such as Alibaba and Amazon. They have also tried to become more interconnected and cut any dependence on external partners, according to Lap.

He expects that forestry products will see the strongest export growth among all commodities in the agricultural sector this year, with revenue topping 12.6 billion USD, up 11.5 percent year-on-year./.

Company ships organic chocolate to Japan

The Thanh Dat Cocoa Co Ltd in the southern province of Ba Ria-Vung Tau on December 16 sent 2 tonnes of 15 types of organic chocolate products to Japan.

This is the first time the province’s organic chocolate has been officially exported to Japan, said Nguyen Chi Duc, director of the Cultivation and Plant Protection Division under the provincial Department of Agriculture and rural Development on the occasion.

The company’s director, Trinh Van Thanh said the company first exported cocoa beans to Japan in 2019. He added that his company is able to export 400 tonnes of cocoa beans each year, and plans to expand raw material growing area in 2021.

Thanh Dat company has set up links with local farmers, guiding them in organic cocoa cultivation in order to produce cocoa beans meeting international standards. In Xa Bang commune (Chau Duc district), where the company is based, there are 125 farming households who cultivate 80 ha of cocoa.

Ba Ria-Vang Tau, which is one of the country’s largest cocoa producers, has about 1,200ha of cocoa, mostly in Chau Duc, Xuyen Moc and Tan Thanh districts where the soil and weather conditions are favourable for planting cocoa./.

Viet Nam – South America logistics trade forum held

The online Viet Nam – South America logistics trade forum has been held to help the two countries' firms expand business co-operation opportunities in the field.

Speaking at the event, deputy head of the Ministry of Industry and Trade (MoIT)’s Viet Nam Trade Promotion Agency Le Hoang Tai said South America is a promising market for Viet Nam’s exports such as apparel, leather and footwear, handicraft, aquatic products and processed food. However, its export turnover remains limited.

Recently, both sides have faced difficulties in trade due to the COVID-19 pandemic. Moreover, distance and limited transportation of goods also resulted in high logistics cost, making it hard for Vietnamese goods to compete with rivals.

Logistics firms also faced barriers related to language, cultural differences and access to market information, he said.

Vice General Secretary of the Viet Nam Logistics Business Association Nguyen Tuong said Viet Nam’s logistics sector was undergoing a digital transformation to meet development demand following the pandemic.

He proposed enterprises meet together or via agents to learn about information related to the market and demand. Embassies should also hold trade promotion trips to support them.

CEO of the Empresas Taylor Company Matthew Taylor Pollmann suggested Vietnamese logistics firms join projects on technological transformation, adoption of artificial intelligence in logistics, or switch to green energy in Chile.

Tai added that the MoIT is reviewing administrative procedures to create favourable conditions for export and logistics firms.

The ministry should also encourage logistics companies to invest in infrastructure and digitalise operations to improve competitiveness, he said. 

Importers to reduce purchases for Tet as lower demand feared

Companies that import fruits and foods expect lower demand during Tet (Lunar New Year) next February due to the impact of COVID-19 pandemic and plan to reduce import.

A company in Binh Thuan Province said it has decided to cut fruit imports between now and Tet by 50 per cent compared to the same period last year despite abundant global supply and steady prices.

“The demand for imported fruits always exists during Tet, but will definitely decrease this time. So not only our company but also many others will tweak their plans. This year we will focus on importing a few popular and easy to sell fruits such as apples, pears and grapes."

But Pham Thien Hoang, director of Pham Hoang Trang Company (which owns GreenSpace Store), expressed a different opinion, saying Tet is the season for consuming fresh fruits such as apples and cherries in the high-end segment.

But their prices have increased significantly this year because the cost of harvesting the fruits in major exporting countries of the fruits such as the US, Australia, and New Zealand have gone up by two to three times due to the impact of COVID-19, and there is a lack of international flights.

Fresh fruit imports are expected to reduce this Tet, while the supply of imported nuts such as pistachios, almonds, walnuts, and pecans will surge, he said.

“These are healthy and nutritious foods. Their prices are not too high at about VND300,000 - 400,000 per kilogramme and imported from many countries. In addition, natural dried fruits such as grapes, plums, and apricots are also imported to serve the market in replace sugar-coated fruits," he told Nguoi lao dong (Labourers) newspaper.

Nguyen Thanh Hung, owner of a company that imports feng shui gifts and organic and processed foods from Russia, said, "The COVID-19 pandemic has made things stagnant so we do not dare import as much as in previous years.”

The transport cost has increased but his company accepted lower returns to keep prices unchanged, he said.

But market research company Ipsos said despite a turbulent year due to the pandemic people’s budgets for Tet are almost the same as last year.

They are somewhat higher in the high-income group, mostly the same in the middle-income group and down by 15 per cent in the low-income group.

Travel abroad this year would be minimal, and so nearly 50 per cent would stick to the tradition of going home to celebrate Tet, it said.

This would increase consumption of food and drinks (confectionery, dried fruits, nuts) but reduce that of tobacco, alcohol, confectionery, and instant foods, it said.

Traditional gift products would be bought as usual.

According to other market research companies, while consumers will still spend during Tet, demand will surely reduce from previous years. 

Credit growth limits extended

The State Bank of Viet Nam (SBV) has extended the credit growth limits for the second time this year to some commercial banks, of which the highest level is up to 30 per cent.

Leading banks including four State-owned commercial banks, also introduced a loan package for production and business, supporting small and medium enterprises with preferential interest rates to boost credit growth at the end of the year.

The lending interest rate ranges from 4.8-6.5 per cent per year for loans less than six months and 5.5-7.5 per cent per year for loans from six to 12 months.

However, home and car loan interest rates of most commercial banks decreased only 10-20 basis points compared to the end of the third quarter, at 7-9.5 per cent per year for the fixed interest rate period, then will be adjusted according to the deposit interest rate or the bank's internal capital transfer interest rate at around 10.5-11.5 per cent per year.

The interbank interest rate was flat at 0.19 per cent per year for the overnight deposit tenor and 0.24 per cent per year for the one-week deposit tenor.

Deposit interest rate is also stable at 2.5-3.8 per cent per year for tenors of less than six months, 3.7-5 per cent per year for six to less than 12 months, 4.9-5.8 per cent per year for 12-13 months.

Credit growth was more positive in the last quarter of the year, but commercial banks' liquidity is still abundant, interbank interest rates and deposit interest rates will move sideways in the next few months.

Market fluctuations revolved around conflicting information about the new US economic stimulus package last week. Overall, the optimistic sentiment remained due to the positive developments in the COVID-19 vaccine.

The USD/VND exchange rate listed by commercial banks remained at VND23,010/23,220.

The exchange rate on the free market increased by 30 dong per US dollar buying in and 40 dong per US dollar selling out to VND23,200/23,240.

The international movement and the domestic foreign currency supply and demand are quite favourable, so the USD/ VND exchange rate will keep a sideways trend.

In addition, the public hearing of the US trade representative on Vietnamese currency valuation on December 29 may create a slight upward pressure on the Vietnamese dong.

Source: VNA/VNN/VNS/SGGP/VOV/NDO/Dtinews/SGT/VIR