Many stores in downtown HCM City have closed.

 
 
 
Business closures hit a record high this year of 101,700, 13.9 per cent higher than last year, according to the General Statistics Office.

Of them, 46,600 have suspended operations temporarily.

Nearly 17,500 completed dissolution procedures, up 3.7 per cent, while nearly 37,700 registered to stop business operations and start dissolution procedures.

Temporary business closures rose in all 17 industries, with retail and wholesale, auto and motor repair, construction, lodging and catering, employment services, tourism, property, education and training, and entertainment having high rates due to the impact of the COVID-19 pandemic.

Some 30,000 of the enterprises that registered to stop operations to undertake dissolution procedures were small with registered capital of VND 0-10 billion (US$0-460,900).

The number of newly established businesses this year declined by 2.3 per cent to 134,900 with combined registered capital of VND2,200 trillion ($94.83 billion), up 29 per cent.

The average registered capital of new enterprise this year is estimated at VND 16.6 billion ($715,000), up 32.3 per cent from last year.

Phu Quoc real estate market forecast to grow, driven by upgrade into first island city

The real estate market of Phu Quoc in the Cuu Long (Mekong) River Delta of Kien Giang was forecast to be robust as the island district has just been given the green light to be upgraded to the country’s first island city in March this year.

According to Nguyen Manh Ha, Deputy President of the Viet Nam Real Estate Association, the upgrade into an island city would create a new push for the real estate market of Phu Quoc, especially as the island was among top tourist destinations in recent years.

Ha cited statistics that Phu Quoc welcomed more than five million tourist arrivals in 2019, a 27 per cent increase over 2018. In 2020 when the COVID-19 pandemic heavily affected the tourism industry, the island also saw significant increase of around 50 per cent in tourist arrivals in November and December when domestic travel resumed as the pandemic was brought under control.

It was estimated that Phu Quoc received more than three million tourist arrivals in 2020.

Ha pointed out that the favourable weather conditions and beautiful scenery made Phu Quoc an attractive destination for investment in tourism property.

Another important factor was Phu Quoc’s developed infrastructure system which made travelling to the island easier and more convenient.

“Tourism property is the most attractive segment in Phu Quoc which is oriented to become a tourism city,” Ha said.

Ha predicted that the Phu Quoc real estate market would see significant increases in prices.

Economic expert Dinh Trong Thinh said that since the penetration of large developers into Phu Quoc with heavy investment in infrastructure like airport and roads, Phu Quoc was changing rapidly and becoming a tourism hub.

The developed infrastructure system also created a launching pad for the island to make breakthroughs, Thinh said.

The inland road system had very good connectivity while there were a high-speed ships from Rach Gia City and Ha Tien Town to Phu Quoc and flights from Ha Noi, HCM City, Can Tho and Vinh to the island.

According to Nguyen Van Dinh, General Secretary of the Viet Nam Association of Realtors, the developed infrastructure system coupled with a favourable administrative mechanism means the real estate market in Phu Quoc would develop rapidly.

The current land prices in the island’s centre ranged from VND100 – 400 million per sq.m. In other areas, the prices fluctuated around VND20-50 million per sq.m.

Dinh said that there was still large room for land price increases.

He stressed that this wouldn't be a market bubble but would be increases in real land value because the potential was real.

According to Pham Thanh Hung, deputy president of the Viet Nam Real Estate Club, it is neccessary for Phu Quoc to have innovations to develop property products of high quality, meeting international standards and setting new living standards.

Former Deputy Minister of Natural Resources and Environment Dang Hung Vo said that Phu Quoc was in an investment process.

Vo believed that the land prices in the island could be two to three times higher in the next ten years.

Still, experts said that investors should pay attention to the legality of property projects and products before making investment decisions.

The potential of the Phu Quoc real estate market was in over the long term, Vo stressed.

Recently, Phu Quoc People’s Council approved the medium-term public investment plan in the 2021 - 2025 period. Accordingly, more than VND17 trillion would be raised for the State budget and land auctions to invest in the transport infrastructure system.

In 2020, Kien Giang Province attracted a total of 23 projects with a total investment of nearly VND20.5 trillion, 20 of which came to Phu Quoc. 

Vietsovpetro eyes close to 3m tonnes of oil equivalent in 2021

The Vietnam – Russia oil and gas joint venture Vietsovpetro sets to exploit nearly three million tonnes of oil equivalent and condensate in 2021, according to Director General Nguyen Quynh Lam.

The company also aims to contribute US$519.4 million to the State budget and generate around $157 million in profit this year, Lam said.

The firm expects to put the platform BK-18A into operation on October 15, 2021 and BK-19, a month later, he noted, adding that it will also work to improve its capacity as a service provider to offshore wind power projects.

In 2020, the joint venture’s oil and gas output reached 3.42 million tonnes, surpassing the set target by nearly 300,000 tonnes.

It said the oil production target was met one month earlier than the plan, while the natural gas output target was fulfilled 44 days ahead of schedule.

As part of solutions to difficulties posed by the COVID-19 pandemic, the company has made efforts to cut production cost and spending. As a result, it has reduced spending by over $105 million, and its production costs decreased by 17 per cent compared to the plan.

Oil sales totalled only about $1.11 billion last year, or 81.1 per cent of the plan. It contributed nearly $745 million to the State budget.

Revenue from outside services and other activities amounted to over $213 million, while after tax profit hit more than $49 million. 

HCM City economic growth hit hard by Covid

HCM City’s economic growth slowed down to 1.39 per cent in 2020 due to the effects of the COVID-19 outbreak.

Huynh Van Hung, head of the city’s Statistics Office, said further the rate was less than half the country's GDP growth rate of 2.91 per cent, the first time this has happened in decades.

In 2019 the city had grown at 7.83 per cent.

But considering its economy depends a great deal on services and tourism, the growth is still satisfactory, Hung said.

Agriculture, forestry and aquaculture grew by 2.06 per cent, services by 2.17 per cent, and industry and construction by 0.43 per cent.

Services grew at the lowest rate in the last 10 years.

Accommodation and dining suffered greatly, falling by 33.94, while real estate sales declined by 4.37 per cent.

Retail sales fell by 1.3 per cent.

Due to the various tax breaks the city offered to mitigate the problems caused by the pandemic to the economy, its revenues declined by 14.2 per cent, Hung said.

It also had to cut public spending by 10 per cent though demand for investment in infrastructure remained high, he said.

There was a trend of large businesses moving from HCM City to nearby provinces such as Long An, Binh Duong and Dong Nai, which are competing with it to attract investment, he said.

Its economy would face many more challenges as global economic integration deepens, he warned.

Phan Thi Thang, deputy chairwoman of the city, said the city has accomplished 16 out of 20 socio-economic targets.

It has helped businesses survive the pandemic, and administrative reforms continued through the year, with the use of information technology in administration increased, she said.

In 2021 the city would continue to have supportive policies with regard to tax and social and unemployment insurance to help sustain businesses and create jobs, she promised.

It would focus on attracting foreign investment, improve its investment climate and encourage new businesses in the fields of electronics, technology, finance, education, and medicine, she said.

It needs to build low-cost and social housing, promote a variety of tourism products and work with partner countries to resume economic activities and tourism, she added.

EVN to digitalise all facilities on transmission lines by 2022

The Vietnam Electricity Group (EVN) is planning to have all equipment on transmission lines and 80 per cent of 110 kV circuit facilities digitalised from now to 2022.

By 2025, EVN will have digitalised 100 per cent of facilities on medium- and higher-voltage power lines, according to EVN Chairman Duong Quang Thanh.

To that end, the group will press on with applying digital technologies like Internet of Things, big data, and cloud computing, he said, noting that it will use artificial intelligence (AI) in monitoring and examination and make use of cameras and smart drones to repair lines.

It will continue research on building information models and digital worker platforms to serve its staff while developing AI applications for image analysis and data governance.

EVN said it has completed 61 of the 63 centres for remote control of transformer stations and converted 670 of the 844 transformer stations into unmanned ones. It also put into operation the first digital transformer station on the 110 kV circuit, located in northern Bac Ninh Province, in January 2020 and the first one on the 220 kV circuit, in northern Hai Phong City, last December.

Ten firms have also applied drones to examining equipment and handling problems on transmission lines without cutting off the power. 

Foreign investors pump over $28.5 billion into Viet Nam in 2020

Foreign direct investment (FDI) registered in Viet Nam hit US$28.53 billion in 2020, a year-on-year decline of 25 per cent due to the significant impact of the COVID-19 pandemic, a report from the General Statistics Office (GSO) revealed.

About 2,523 new projects were licensed with capital totaling $14.6 billion, down 35 per cent in the number of projects and 12.5 per cent in registered capital.

Meanwhile, 1,140 operating projects were allowed to raise their investment capital by $6.4 billion, up 10.6 per cent year-on-year. Foreign businesses also invested $7.5 billion during the year through capital contributions and share purchases, representing a yearly reduction of 51.7 per cent.

From January to December, FDI disbursement also experienced a slight decline of 2 per cent to nearly $20 billion.

In 2020, foreign companies invested in 19 sectors in Viet Nam. Of which, processing and manufacturing lured the lion's share of FDI with $13.6 billion, accounting for 47.7 per cent of the total capital. Power production and distribution came next with more than $5.1 billion or 18 per cent. Real estate and wholesale sectors were the runners-up with $4.2 billion and $1.6 billion, respectively.

However, the Ministry of Planning and Investment (MPI), said many foreign-invested enterprises in the country have gradually recovered and maintained business and production activities. More importantly, many others showed their strong interest in investing in Viet Nam.

Statistics from the MPI showed that nearly 300 international companies were seeking investment opportunities in Viet Nam or expanding their operations in the country. Of them, over 60 firms had made initial steps in investing or expanding presence in the Southeast Asian nation.

As of December 20, Viet Nam was home to 33,070 valid foreign-invested projects with a total registered capital of $384 billion and 60.4 per cent of the sum ($231.86 billion) was disbursed.

South Korea was the country’s largest source of FDI with over $70.6 billion or 18.4 per cent of the total capital. Japan ranked second with $60.3 billion or 15.7 per cent, following by Singapore, Taiwan and Hong Kong.

According to the GSO, Vietnamese companies also poured $590 million into overseas projects in 2020, up 16 per cent compared to 2019. Of the sum, $318 million came from 119 new projects while the remainder of $272 million from 33 operational projects which registered to increase their investment capital. 

Ha Noi outperforms rest of country: leader

Ha Noi has recorded better economic results than anywhere else in Viet Nam amid the COVID-19 pandemic, according to chairman of the Ha Noi People's Committee Chu Ngoc Anh.

“In 2020, the total State budget revenue in the city is estimated at VND279.3 trillion (US$1.2 billion), reaching more than 100 per cent of the city’s plan, increasing 3.5 per cent compared to the implementation in 2019," Anh told an online conference this week.

He added that by following the directions of the Government and National Assembly, the capital had achieved or exceeded most of its targets for the year.

Anh said the economy recovered quickly after two periods of social distancing due to the pandemic in April and August, adding that growth indexes decreased in the first period in April, then quickly regained growth momentum from May while some indexes decreased in the second social period in August compared to July but regained strongly from September.

The gross regional domestic product (GRDP) in the fourth quarter increased compared to Q3, he said, adding that GRDP in Q1 increased 4.43 per cent, Q2 increased 2.41 per cent, Q3 increased 3.31 per cent and in the last quarter increased 5.51 per cent.

“GRDP in 2020 is estimated to increase 3.94 per cent, about 1.5 times higher than the national average growth rate," he said.

Services increased by 3.1 per cent, industry went up 5.64 per cent, construction gained 8.66 per cent, agriculture grew by 4.2 per cent, said Anh.

“The achievements were thanks to better investment attraction and improvement of business environment in the city," the leader said.

The Provincial Competitiveness Index (PCI) of Ha Noi in 2019 reached 68.8 points, up 3.4 points compared to the previous year, maintaining ninth place out of 63 provinces and cities. Out of the 10 PCI component indexes, eight indexes increased.

Anh said the city would work in the five principles of discipline, responsibility, action, creativity, and development and build 23 major socio-economic development targets to increase the GRDP by about 7.5 per cent in 2021. 

Viet Nam eyes high-quality coffee exports

Viet Nam is working to develop high-quality Vietnamese coffee as a national product to expand its added value for exports.

Coffee exports brought the country US$2.7 billion from an estimated 1.7 million tonnes in 2020, accounting for more than 10 per cent of the world’s coffee value and 18 per cent of market share, according to the Ministry of Agriculture and Rural Development (MARD).

Coffee is among the 10 key products of Viet Nam and the top six products with export value topping $3 billion each year.

The country has 664,000 hectares of coffee plantations with a yield of 1.5 million tonnes per year, 93 per cent of which is robusta with the remainder arabica. Vietnamese coffee has been shipped to 80 countries and territories worldwide.

However, experts at a conference this week to review national high-quality coffee development said although Viet Nam is renowned for its coffee volume, the country has not gained a reputation for coffee quality due to the low proportion of high-added-value products.

To help the coffee sector improve export value and maintain its position as the world’s second coffee producer and exporter amidst fierce competition, Prime Minister Nguyen Xuan Phuc approved Decision No.787/QD-TTg dated June 5, 2017, listing coffee in the programme to develop national products until 2020.

The project aimed to develop a coffee industry that produces high quality, competitive and high added value products by employing new varieties, advanced cultivation techniques and post-harvest technologies, while building brands, develop markets and enhance productivity, quality and efficiency of coffee production and business.

Deputy Minister of Agriculture and Rural Development Le Quoc Doanh said the coffee industry has received great attention from the Government and developed in a more sustainable and effective manner in recent years, particularly after the ministry approved a coffee re-plantation project.

The project aimed at 120,000 hectares of coffee under re-plantation by 2020, however, more than 150,000 hectares have been re-cultivated so far.

The World Bank-funded project 'Viet Nam Sustainable Agriculture Transformation' worth $300 million has also been effective, Doanh said.

He said there is a huge workload to ensure the coffee sector’s sustainable development, including choosing the best varieties, promoting mechanisation, intercropping plants and improving the management of varieties.

Besides achievements, many shortcomings were identified at the conference including a lack of business involvement in the programme, poor product variety and low competition for Vietnamese coffee brands, weak connection among the market participants and research-production-chain-branding activities.

According to Vu Duc Con, deputy director of Dak Lak Department of Agriculture and Rural Development, the province has about 208,000 hectares of coffee with an output of more than 476,000 tonnes. Because many coffee gardens are old and low-yield, the province replanted more than 35,000 hectares.

The replanted coffee area is mainly made up of new varieties, gradually improving yield and quality of the area, especially in the context of climate change.

To develop high-quality Vietnamese coffee, he said provinces need to continue reviewing plans for replanting old coffee gardens with low yield and poor quality, even for partial plantation in some gardens.

In addition, it is necessary to develop stable material areas through stronger links with farmers, providing adequate and transparent information for exporting enterprises to reduce unfair trade among buyers and sellers, Con said.

Experts agreed the coffee sector has huge export opportunities as Viet Nam has signed 15 free trade agreements (FTAs) so far, including the EU - Viet Nam FTA and the newest UK-Viet Nam FTA which are expected to help expand markets for the Vietnamese staple. 

Hanoi welcomes over 118,000 visitors during New Year holiday

The capital city of Hanoi welcomed over 118,000 tourist arrivals during the New Year Holiday from January 1-3, according to the municipal Department of Tourism.

Of the total visitors, there were 4,451 foreigners who came for official and diplomatic purposes.

The most favourite destination during the holiday included Vietnam National Village for Ethnic Culture and Tourism (over 7,300 visitors), Hanoi Zoo (5,000 visitors), Duong Lam ancient village (3,200 visitors), and Hoa Lo prison (1,700 visitors).

Particularly, the Heineken Countdown Party held on December 31 night in front of the Hanoi Opera House drew swarms of locals and visitors who came to enjoy outdoor concerts and pinnacle firework displays to welcome the New Year.

The tourism department, in collaboration with competent agencies, organised an event to welcome the first visitors to the capital city on January 1.

In a bid to promote local tourism, many lodging facilities slashed down their service prices by 25-50 percent with many attractive packages and menus. Furthermore, music programmes were organised by four-star and five-star hotels to entertain the customers./.

UKVFTA a push for Vietnam’s agricultural exports to UK

The UK-Vietnam Free Trade Agreement (UKVFTA) will open up more opportunities to boost the export of Vietnam’s key agricultural products with the commitments to market opening the same as the EU-Vietnam FTA, Minister of Industry and Trade Tran Tuan Anh has said.

Since becoming effective from August 2020, the EVFTA has created a big push for Vietnam’s agricultural exports such as seafood, rice, vegetables and fruits, and wood products to the UK.

As the UKVFTA inherits existing commitments in the EVFTA, plus additional quotas for competitive products, Vietnamese businesses will see more export opportunities.

Nguyen Dinh Tung, Chairman and CEO of Vina T&T Group – a leading fruit exporter, said the UK is a big market for vegetables and fruits in Europe with diverse import demands.

According to him, Vietnam’s vegetables and fruits could be exported to the UK in particular and the EU in general, if they win orders and meet the countries’ requirements on food safety and plant quarantine.

The UK also has huge demand for wood and wood products, which creates numerous opportunities for Vietnamese exporters as their merchandise have competitive prices, good materials and high quality.

General Secretary of the Vietnam Association of Seafood Exporters and Processors (VASEP) Truong Dinh Hoe said that the UK is also a potential market for Vietnam’s aquatic products.

Despite the COVID-19 pandemic, the export value of Vietnamese aquatic products to the UK had hit nearly 258 million USD as of late September 2020, up 23 percent year-on-year.

The pandemic is changing the UK’s consumer and import trends, with cheap products easy to consume and cook at home being a top choice.

Therefore, frozen tra fish of Vietnam has a huge advantage and has become a key export of the Vietnamese agricultural sector.

However, insiders said that the UKVFTA also brings about more challenges with stricter requirements.

They advised Vietnamese businesses to improve production, harvesting, preservation and processing to gain better product quality./. 

Vietnam’s exports to US estimated at 76.4 billion USD

Vietnam moved up four grades to become the second largest exporter to the US in 2020, with its export turnover to the country surging 24.5 percent to an estimated 76.4 billion USD.

The US remains the biggest importer of Vietnamese goods in recent years, importantly contributing to expanding markets, promoting production and increasing foreign currency income.

However, Vietnam’s exports to the US accounts for 2.7 percent of the American country’s total imports from all countries and territories worldwide.

Besides traditional exports such as textiles, footwear and aquatic products, Vietnam has also shipped electronics, spare parts and wooden products to the market.

According to the General Statistics Office, Vietnam’s total export turnover in 2020 reached 281.5 billion USD, up 6.5 percent year-on-year. The country enjoyed a trade surplus of 19.1 billion USD this year./.

UKVFTA opens up opportunities for steel, mechanical firms

Vietnamese exporters in the steel and mechanic sectors expect to get easier access to the UK market following the signing of the UK-Vietnam Free Trade Agreement (UKVFTA) last month.

According to the Vietnamese Ministry of Industry and Trade, the UK is Vietnam’s third largest trade partner in Europe.

Vietnam’s major exports to the UK include phones and component, garments-textiles, footwear, seafood, wood and timber products, computers and components, cashew nuts, coffee, and pepper.

Previously, Vietnamese steel products had been mainly shipped to Southeast Asian nations, the US and China, the Vietnam Steel Association (VSA) said, noting that there is ample room for those products to enter the UK market.

However, it is not easy to boost steel exports to the country right in 2021 as the UK is a demanding market in terms of standards and incentives. In addition, steel is not Vietnam’s strength.

Notably, the complex developments of the COVID-19 pandemic in the UK and Europe have hindered the exchange of goods in general and steel products in particular.

Given increased protectionism, it is necessary to shift towards other markets apart from such traditional ones as ASEAN, China and the US, and the EU-Vietnam Free Trade Agreement (EVFTA) and the UKVFTA are set to facilitate Vietnamese steel exports.

The VSA suggested Vietnamese enterprises update technologies and revamp their production process as well as business methods.

Dao Phan Long, Chairman of the Vietnam Association of Mechanical Industry, pointed out weaknesses in production technologies, especially machinery and high-tech equipment, facing the domestic mechanical sector.

There will be not many opportunities for Vietnamese mechanical product exporters, he said. Therefore, those firms should optimise the agreement to attract British investments in mechanics, electronics, processing and manufacturing, in order to participate in production and supply chains.

Nguyen Duc Cuong, General Director of Hikari Vietnam Production and Trading Company Limited, said only companies that have long-term operation plans with good administration methods can exist and grow in 2021.

Experts also emphasised the need for Vietnamese goods to meet high-standards set by the UK regarding product quality, environment, hygiene and prices.

To that end, domestic firms must further apply technologies, improve product quality and lower prices, while keeping a close watch on changes in product standards, production process and customs procedures, they said./.

Lobster prices soar due to shortages in Phu Yen

Lobster prices have sharply increased in Phu Yen Province due to a shortage in supplies.

Song Cau Town in Phu Yen Province, the country's largest lobster raising area, is receiving a large number of traders at this time.

According to local farmers, lobster prices have gone up to their highest level in recent years at between VND1.3-VND2.4 million (USD57-104) per kilo, which means double the price during the February-June period.

Despite high prices, local farms do not have much to sell after the recent devastating floods. 

"Dozens of tonnes of lobsters died in our farms during the floods in November," a farmer said. "Now we don't have much to supply despite huge demand."

Another farmer, Vo Thi Bay, said that she raised 2,000 lobsters but over 1,000 died in the floods in November.

"Now I have some 900 lobsters to sell and thanks to the high prices I can make up the losses caused by the floods," Bay said. "I’m lucky while many farmers here lost all to the floods." 

According to traders, demand for lobsters from China and some southern provinces have increased at this time.

Statistics from Song Cau Town Economics Department showed that local farms were expected to supply 760 tonnes of lobsters in 2020. However, after the floods there are now only some 25 tonnes left. The shortage has driven the prices up.

Singapore economy shrinks by 5.8 pct last year

Singapore’s gross domestic product (GDP) was estimated at minus 5.8 percent last year, the country’s Ministry of Trade and Industry (MTI) announced on January 4.

In the fourth quarter, its economy contracted by 3.8 percent annually compared to the minus 5.6 percent in the previous quarter, as a number of COVID-19 prevention and control measures were lifted.

According to the MTI, recovery in manufacturing, especially in electronics, biomedical production and precision engineering with a 9.5 percent growth, gave a boost to the economy in the fourth quarter.

Construction was one of the major obstacles to growth with a 2020 expansion of minus 28.5 percent.

The MTI gave a positive forecast on domestic economic prospect with a growth of 4-6 percent, a record since 2011 when the economy expanded by 6.3 percent./.

Numerous key Vietnamese products to enjoy advantages from UKVFTA

The nation looks set to enjoy a wealth of opportunities to increase export turnover of numerous key products to the UK through the enforcement of the UK – Vietnam Free Trade Agreement (UKVFTA).

This comes as the UKVFTA officially took effect from 23:00 on December 31, 2020, thereby signaling the beginning of a new phase in the relationship between the two countries, particularly with regard to the development of key commercial sectors. The UKVFTA will not only serves to create the liberalisation of trade in goods and services, but also helps to integrate many other important factors as part of green growth and sustainable development.

At present, the nation's export staples to the UK include phones and components, garments and textiles, footwear, seafood, timber and wood products, computers and their components, cashew nuts, coffee, and pepper. In return, the country imports goods such as machinery, equipment, pharmaceuticals, steel, and chemicals from the UK. Indeed, imports and exports between the two are considered to be complementary as opposed to being competitive.

According to the Ministry of Industry and Trade (MoIT), 2019 saw the UK mainly import garment products, such as suits, jackets, blazers for women or girls, outerwear, gowns for women or girls, tights, pullovers heads, cardigans, giles, and similar items from the Vietnamese market.

With regard to footwear, despite ranking second in the world in terms of exports, Vietnamese footwear exports only account for 8% of global export turnover, while China makes up roughly 40%.

The UK is also viewed as a potential buyer of Vietnamese rice, with last year's rice exports to this market witnessing a significant leap forward, with turnover growth reaching 376%. Despite this remarkable figure, the tariff on this item in 2019 remained high, therefore making it difficult to compete with other countries.

Concerning seafood products, the MoIT assessed that the country enjoys advantages in experience, production capacity, and abundant supply. Import demand for the UK’s seafood products remain fairly large, at roughly US$4.4 billion annually, while the country’s export value accounts for only 6.7%.

Vietnamese frozen tra fish, also known as pangasius, could be a benefactor of greater export opportunities to the UK as the nation is the leading supplier of the product, offering reasonable prices, whilst the production process of many Vietnamese firms is accepted by both the EU and UK markets.

For wood products, the UK represents a market that needs to import a large number of finished products and timber materials each year, whilst the country is currently the sixth largest wooden furniture exporter in the world with an export value of US$421.8 million, holding 3.6% of the UK's import market share.

Macroecononic stabilisation in 2020 can create momentum for 2021

Economic experts believe that macroeconomic stability and growth results achieved amid difficulty circumstances during 2020 can serve as a strong foundation for economic growth in the year ahead.

Despite facing plenty of difficulties, Vietnam's economy in 2020 achieves a growth rate of 2.91%.
With 2020 now gone after an array of unprecedented uncertainties facing the global and the local economies, the novel coronavirus (COVID-19) pandemic is still spreading in many countries around the world and continues to disrupt socio-economic activities globally.

Furthermore, trade conflicts between various countries and regions are still going on, whilst natural disasters have also hit the nation. Despite these difficulties, the Vietnamese economy maintained growth of 2.91% in 2020 thanks to capable pandemic control and timely support policies aimed at people and businesses.

Despite reaching a GDP growth rate of 2.91%, the lowest growth rate for 10 years amid complicated developments relating to COVID-19 negatively affecting all socio-economic fields, last year can be considered a great success for the country. This can be seen as the nation's economic growth rate in 2020 was among the highest in the world, with GDP in the fourth quarter of last year increasing by 4.48% over the same period from last year.

"This shows the correction direction and the determination and unanimity of the entire political system, the Government, the Prime Minister, in addition to the efforts of the people and business community to effectively carry out the dual goal of ensuring pandemic prevention and control and boosting socio-economic development," says Nguyen Thi Huong, general director of the General Statistics Office (GSO).

With the achievements recorded in 2020 by the nation, many international organisations and financial institutions have given positive forecasts about economic growth prospect ahead in 2021.

The World Bank (WB) predicts that the Vietnamese economy will grow by 6.8% in 2021 and stabilise at 6.5% over the subsequent years. This forecast by the WB is based on the assumption that the COVID-19 crisis will gradually be brought under control, with COVID-19 vaccine proving to be effective.

Moreover, the World Economic Outlook in 2020 held by the International Monetary Fund (IMF) stated that due to the tight control of the pandemic, the nation is one of the few places to maintain a stable growth rate, with an IMF forecast of a 1.6% increase in 2020 and a 6.7% rise ahead in 2021.

According to Dr. Le Duy Binh, macroeconomic stability and growth results in the context of the previous year will serve as a good foundation whilst creating good momentum for economic growth next year. In the short term, the V-shaped graph is likely to continue moving into 2021, especially given the global economic recovery with the COVID-19 vaccine being successfully mass-produced. This will help to support widespread economic recovery, with the graph of the country’s economic growth set to depend on the global economic recovery, which still has many fluctuations.

“With the current efforts to keep the growth rate of 2020, we can fully expect the V-shaped growth scenario in the following years. However, the wide or narrow angle of this V shape depends on many other factors that are difficult to predict at present. However, based on existing evidence and current trends, it is possible to believe that the growth rate in 2021 will be higher than in 2020,” Dr. Binh says.

Dr. Le Xuan Nghia, an economic expert, states that 2021 will be a difficult year, with no major expectations for the national economy. Therefore, a modest economic target should be devised with a growth rate of approximately 5%.

In an effort to achieve higher goals for the economy, he says that it is necessary to change perceptions in terms of digital technology development as a way of spurring economic development.

Dr. Nghia underlines the need to revive Vietnamese digitisation companies, due to digital technology playing an important role in production, business, and sales. Domestic businesses must therefore enhance their linkages with on another, and connect with manufacturers and consumers in a bid to revitalise the national economy, he adds.

Rice export price hits new record high

Vietnam’s rice export price reached its latest peak on January 3 at US$505 per tonne, representing a record high over the previous nine years, according to rice traders.

The price of Vietnamese 5% broken rice in the global market increased by approximately US$7 to a high of US$505 per tonne.

The latest rise can be attributed to a limited supply and an increasing demand for rice reserves in many countries, especially the Philippines, largely due to complicated developments of the COVID-19 pandemic globally.

Nguyen Trung Kien, vice chairman of the Vietnam Food Association, anticipates that Vietnam will continue to enjoy robust growth in rice exports in the first quarter of 2021 after its major rice importers such as the Philippines and Africa have agreed to sign additional import contracts.

Furthermore, several markets also have a high demand for fragrant rice and sticky rice, which are advantageous commodities of local businesses.

This is not to mention bright export prospects for rice exports local businesses will enjoy following Vietnam’s recent signing of free trade agreements (FTAs). For instance, countries that make up the Eurasian Economic Union (EAEU) have pledged to provide a tariff quota of 10,000 tonnes of rice for Vietnam this year through the Vietnam-EAEU FTA.

Moreover, the recent signing of the UK-Vietnam Free Trade Agreement (UKVFTA) looks set to allow Vietnamese rice exports to the UK market to enjoy a tax reduction of 0% without quota limits.

According to the Ministry of Agriculture and Rural Development, Vietnam exported 5.74 million tonnes of rice worth US$2.85 billion during January - November 2020, representing a decrease of 2.2% in volume and an increase of 10.4% in value compared to the same period of 2019.

Stock market aims for sustainable development in year ahead

The Vietnam stock market is anticipated to develop in both scale and quality of operation this year, affirming its role as an effective capital mobilising channel for the local economy, according to Minister of Finance Dinh Tien Dung.

Minister Dung made the statement during a gavel striking ceremony held on January 4 to mark the opening of the first trading session of 2021.

During the ceremony, the Minister emphasised that 2021 can be considered an important year for national politics due to the organisation of the upcoming 13th National Party Congress expected to provide a solid foundation for the local economy and the stock market this year.

Furthermore, the amendment of the Investment Law and Enterprise Law, especially the official enforcement of the Law on Securities, is anticipated to create a new legal foundation to enhance competitiveness, improve transparency, and the operational efficiency of stakeholders towards the sustainable development of the Vietnamese stock market.

With regard to key objectives ahead throughout the year, Minister Dung requested that the State Securities Commission and relevant units continue to fine-tune the legal system for the securities market, speed up the restructuring of the securities and insurance markets, whilst also accelerating the equitisation process of State-owned enterprises.

This should be done alongside increasing market size and liquidity, and introducing new products in transactions over the course of 2021, he stressed.

HCM City aims for 33 million tourists in 2021

HCM City targets having 33 million tourists visit the city in 2021.

The HCM City Department of Tourism on Friday, in collaboration with the city Tourism Association and Tân Sơn Nhất International Airport, held a welcome ceremony for the first visitors to HCM City in 2021.

About nine tourists departing from Hà Nội and Côn Đảo on Việt Nam Airlines flights VN7245, BL6025 and 0V8080 arrived in HCM City on New Year’s Day.

Ten other passengers from Vietjet Air VJ127 and Bamboo Airways QH203 came from Hà Nội.

The first visitors to land in HCM City received round-trip domestic flight tickets and travel vouchers, along with multiple discounts from travel agencies and tourism services in HCM City.

Nguyễn Thị Ánh Hoa, director of the city Department of Tourism, said the welcome ceremony is one of the key activities promoting the annual campaign “Thành phố Hồ Chí Minh xin chào - Hello HCM City”.

“The tourism industry in HCM City looks forward to efficient control of the COVID-19 pandemic from authorities. 2021 is expected to be the year of recovery for the domestic market and reopening of the international market in the following years. The first visitors this year mark the beginning of HCM City’s goal to reach 33 million tourists in 2021,” she said.

Hoa added that in an effort to develop HCM City to become a leading tourism city in Asia, the department has planned new tourism products and events to attract more visitors.

Some notable events include the 8th HCM City Áo dài Festival and HCM City Tourism Day, along with tours at old Sài Gòn’s relics.

Last year, the city tourism market suffered greatly from the COVID-19 pandemic. The total number of international visitors to HCM City in 2020 was 1.3 million, down 84.8 per cent year on year, while the number of domestic travellers to HCM City was 15.8 million, a decrease of 48.45 per cent year on year. 

Total tourism revenue was estimated at VNĐ84,512 billion, down 39.66 per cent compared to 2019.

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