Prime Minister Pham Minh Chinh has stressed the need to implement specific tasks in order to untangle knots in e-commerce development, according to the Government Office.

The office on July 12 released the PM's conclusion at a conference reviewing the one-year realisation of the government leader’s directions regarding the project on developing resident data, electronic identification and authentication applications to serve national digital transformation in the 2022 - 2025 period, with a vision to 2030 (Project 06), and promoting data connection and sharing in service of e-commerce and tax management.

Accordingly, ministers, heads of ministerial-level agencies, the General Director of Vietnam Social Security, the chairpersons of the People's Committees of provinces and centrally-run cities were asked to review the implementation of essential public services, ensuring that they are completed as scheduled. They were also instructed to concentrate resources on accelerating the digitisation of records and the settlement of administrative procedures at all levels.

The Ministry of Public Security was assigned to continue providing 13 utilities on VNelD, especially the pilot issuance of criminal record cards in Hanoi and the central province of Thua Thien - Hue, which will be rolled out nationwide this month.

The Ministry of Finance was urged to promote tax management, continue providing e-tax services, and deploy e- invoice solutions for e-commerce activities and livestream sales on digital platforms.

The PM assigned the Ministry of Industry and Trade to coordinate with relevant agencies to study and propose solutions to manage and sustainably develop domestic and cross-border e-commerce platforms as well as supplement regulations relating to stakeholders in e-commerce and livestreaming activities.

Meanwhile, localities were urged to promote digital transformation, provide support in terms of human resources and funding to roll out such tax management solutions, while deploying e-invoices to control the retail sector and strengthening the inspections and handling of violating business establishments./.

Vietnam, France eye high cooperation prospects in hydrogen development

Hydrogen de France (HDF Energy), a French energy company that has been present in Vietnam since 2022, has inaugurated its first fuel cell factory in Bordeaux of France, which is expected to lay a foundation for the launch of its “green” hydrogen factories in Vietnam and other countries in the future.

According to Tran Khanh Viet Dung, Director of HDF Vietnam, HDF Energy has implemented many cooperation projects with the Ministry of Industry and Trade, the Ministry of Transport, the Vietnam Railway Corporation, and the Vietnam Electricity.

The company has also engaged in the development of projects in many provinces such as Kien Giang, Binh Thuan, and Ninh Thuan, which have great potential in developing renewable energy such as offshore and onshore wind power, or solar power, he said, adding that these are renewable energy sources to produce "green" hydrogen to serve the transportation industry.

In particular, HDF Energy has worked with the Vietnam Railway Corporation on a scheme to convert nearly 200 old diesel-fueled locomotives that have been operating for decades to using hydrogen, a clean and green energy to contribute to implementing Vietnam's net-zero emissions strategy by 2050 and the "green" hydrogen energy development strategy approved by the Government from early 2024, said Dung.

He expressed his hope that HDF Energy can built its first hydrogen factories in Vietnam soon.

HDF Energy has signed a deal with Petrovietnam Technical Services Corporation (PTSC) to develop power generation projects taking advantage of renewable energy sources using Renewstable technology and hydrogen gas sources using Hypower technology in Vietnam and the Asia-Pacific. This is a basis for the two sides to research and implement power projects using renewable energy and hydrogen gas, and develop this cooperation model for similar projects in the Asia-Pacific region.

HDF Energy is also researching and implementing other projects with Vietnam in the field of electricity and transportation with the support of the Just Energy Transition Partnership and financial institutions, including the French Development Agency (AFD).

Mathieu Geze, HDF Energy's Executive Director for Asia, said that his company hopes to accompany Vietnam during the country’s carbon emission reduction process.

Chairman the Chamber of Commerce and Industry (CCI) of Nouvelle Aquitaine Jean-François Clédel said that renewable energy is an area that Nouvelle Aquitaine, represented by HDF Energy, has great potential to cooperate with Vietnam./.

Tra fish export to CPTPP market reaches 114 mln USD as of June 15

Vietnam raked in 114 million USD from tra fish export to the signatory nations of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) as of June 15, a year-on-year increase of 10%, according to the General Department of Vietnam Customs.

Mexico was the largest buyer as it spent 31 million USD on the Vietnamese product, rising 35% against the same time last year, followed by Japan (18 million USD, up 35%), Canada (18 million USD, up 15%), and Singapore (16 million USD, up 0.2%).

The Vietnam Association of Seafood Exporters and Producers (VASEP) said the trade pact has created momentum for the Vietnamese fisheries to “take off”, highlighting the implementation of the free trade agreement has facilitated enterprises’ market expansion and diversification while helping Vietnamese fishery products, including tra fish, better integrate into the global production and supply chains.

The association expected that tra fish shipment in the second half of the year will maintain its growth since prices and demands are stabilising, suggesting enterprises improve competitive edge, and study the benefits regarding tariff rates that the CPTPP have brought about to enhance export./.

Vietnam Airlines to run Hanoi-Phnom Penh route in October

Vietnam Airlines has announced its plan to operate direct flights between Hanoi and Phnom Penh starting October 27.

Accordingly, the national flag carrier will run four round-trip flightsusing Airbus A321 aircraft per week on Mondays, Wednesdays, Fridays, and Sundays.

Currently, passengers travelling with the airline from Hanoi to the Cambodian capital need to transit in Vientiane. The new route will raise its total to five, and weekly flights connecting the two countries to 86.

In addition, the carrier has signed memoranda of understanding on cooperation with the Cambodia Angkor Air, the Cambodian Tourism Association and the Vietnamese travel company Saigontourist Group. It is set to coordinate with its partners in tourism promotion activities in both Vietnam and Cambodia and engage in mutual support regarding their services and products.

On average, about 450,000 people travel by air between the two countries each year, and the yearly growth rate is 24% in the past more than three decades,

In 2023, 1 million Vietnamese visited Cambodia, and more 400,000 Cambodians came to Vietnam./.

Reference exchange rate drops slightly at week’s beginning

The State Bank of Vietnam (SBV) set the daily reference exchange rate at 24,245 VND/USD on July 15, down 3 VND from July 13.

With the current trading band of +/- 5%, the ceiling rate applicable for commercial banks during the day is 25,457 VND/USD and the floor rate 23,033 VND/USD.

At commercial banks, the opening-hour rates also fluctuated slightly.

At 8:20 am, Vietcombank listed the rates at 25,237 VND/USD (buying) and 25,457 VND/USD (selling), both down 3 VND from the rates two days ago.

BIDV also cut both rates by 3 VND, listing the buying rate at 25,237 VND/USD and the selling rate at 25,457 VND/USD./.

Government seeks to attract investment in mountainous regions

In a move to unlock the economic potential of Vietnam's mountainous areas, the International Cooperation Department (ICD) under the Government Committee for Ethnic Minority Affairs has joined hands with the Institute for International Investment Studies (ISC) through a strategic cooperation agreement.

This partnership aims to improve the quality and effectiveness of foreign investment collaboration and attraction in mountainous provinces, thereby contributing to their comprehensive socio-economic development.

The agreement outlines three key areas of collaboration, including educating officials from mountainous provinces about legal knowledge, state management skills in foreign investment and the best practices in foreign investment; leading and coordinating investment promotion activities in these regions; and providing mutual consultation on activities related to international investment cooperation.

Phan Huu Thang, Chairman of both ISC and the Vietnam Industrial Park Finance Association (VIPFA), hailed the agreement as a significant step.

He underlined its potential to pool international resources and capabilities for the benefit of ethnic minority and mountainous regions. Ultimately, this partnership aims to improve the lives of local residents and accelerate Vietnam's integration into the global economy./.

PM requests settlement of obstacles to expressway project in Mekong Delta

Prime Minister Pham Minh Chinh had a working session on July 13 with ministries and localities in the Mekong Delta to resolve obstacles and promote strategic transport infrastructure development, after concluding two fact-finding trips to expressway construction projects.

This was the third meeting of the Government leader with ministers, secretaries of provincial party committees and chairpersons of 13 provinces and cities in the Mekong Delta on the issue.

According to reports, the Mekong Delta is currently implementing five key transport projects, including the eastern section of the North-South Expressway project from Can Tho to Ca Mau; Chau Doc-Can Tho-Soc Trang Expressway; Cao Lanh-An Huu Expressway; My An-Cao Lanh Expressway; and Ho Chi Minh Road project (11km Rach Soi-Ben Nhat section, and 41km Go Quạo-Vinh Thuan section).

To date, four out of five projects have completed investment procedures and are under construction and the My An-Cao Lanh Expressway is slated to start construction at the beginning of 2025.

Site clearance, one of the most important steps which could define progress and set the construction schedule, is nearly complete. However, if any issues are unresolved by the end of July 2024, it could affect the overall completion of the projects.

Intensive efforts are being made in construction, but the progress has not met the planned schedule, mainly due to a previous shortage of sand. Fortunately, the material supply has now been stable, with about 65 million cu.m guaranteed.

Highlighting some difficulties and proposals to promote project implementation, ministries, sectors and localities pledged to continue cooperation and support to ensure smooth project progress and achieve the set goals.

Concluding the conference, PM Chinh congratulated the 13 provinces and cities in the Mekong Delta for initially forming an expressway network after three years of active implementation, significantly developing the transport infrastructure in line with the strategic breakthrough spirit of the 13th National Party Congress' Resolution. Various modes of transportation have developed rapidly and comprehensively in the Mekong Delta.

On behalf of the Government, PM Chinh praised the efforts and dedication of ministries, sectors, localities, project management boards, companies, contractors, supervisory consultants and the team of officials, engineers, and workers who have been working diligently at the project sites.

He also thanked and praised the families, communities and individuals who supported and quickly handed over land for project construction.

The Government leader urged agencies and units, especially leaders, to prioritise national and ethnic interests, fulfill their responsibilities and have integrity, talent, responsibility and efficiency. Management must continuously be improved, practical, smart, digitalised and reduce administrative burdens and compliance costs for people and businesses.

He emphasised the goal of having 600km of expressways in the Mekong Delta by 2025 and 1,200km by 2030, assigning progress targets for each project, focusing on the North-South and East-West expressways.

The government leader requested ministries, sectors, and localities to thoroughly implement the principle of "only discussing actions, not setbacks", making all efforts to complete expressway projects on time, or ahead of schedule, which will open up new opportunities and development space for the entire Mekong Delta region, as well the country.

Construction must be conducted in the spirit of "persistence through rain or shine", "working day and night", "through holidays, through Tet, through weekends".

He urged mobilisation of the entire political system to participate in the 500-day campaign to complete 3,000km of expressways to celebrate the 50th anniversary of the Liberation of the South and reunification of the country, the 80th National Day, and the 14th National Party Congress.

Regarding capital, PM Chinh requested ministries and sectors to coordinate with localities to carefully calculate and report to competent authorities. The Ministry of Finance and the Ministry of Planning and Investment must advise and reasonably allocate funds and the Government will resolve issues within its authority.

Regarding site clearance, PM Chinh requested local secretaries and chairpersons to mobilise the combined strength of the entire political system to support project implementation, particularly relocating technical infrastructure, with a focus on resolving site clearance comprehensively to provide land for project construction.

He also ordered localities to take care of the lives of relocated households, ensuring that their conditions at new locations are equal to or better than before, focusing on employment and livelihoods, and ensuring the safety of people's lives and property during construction.

Regarding materials, he requested ensuring supply and completing on schedule. For sand fill materials, localities must actively enhance the mining capacity of material mines, transfer materials between projects to meet progress requirements and complete procedures for mining licences in July./.

Exporters advised to update Singapore trade policies

The Việt Nam Trade Office in Singapore has advised Vietnamese exporters to carefully study and keep updated on new regulations in Singapore as they become more cautious in trade policy, in order to further exploit this market.

A representative from the office said recently the Singapore Food Agency (SFA) revised the Qualified Person (QP) declaration form for export consignments of food products, which has been applicable since July 1.

On February 16, Singapore’s Ministry of Finance (MoF) proposed the Multinational Enterprise (Minimum Tax) Bill and subsidiary legislation called the Multinational Enterprise (Minimum Tax) Regulations 2025.

The proposed bill and subsidiary legislation will implement a Qualifying Domestic Minimum Top-up Tax (QDMTT) and the Income Inclusion Rule (IIR) under Pillar Two of the Organisation for Economic Cooperation and Development (OECD) Base Erosion and Profit Shifting (BEPS) 2.0 initiative. The ministry gathered public feedback on the proposed legislation from June 10 to July 5.

The office also noted a number of changes in tax policies that Singapore is about to apply on domestic and foreign businesses, and reminded Vietnamese State management agencies and companies to regularly follow up to make suitable policy adjustments.

According to Cao Xuân Thắng, Trade Counsellor and head of Việt Nam Trade Office in Singapore, in the first five months of 2024, Việt Nam’s exports to Singapore rose 26.09 per cent to nearly 3.29 billion SGD (US$2.44 billion).

Strong growth was seen in the export of all the three major groups of products in the Singaporean market, with the group of machinery, equipment, mobile phones, components and spare parts rising 28.87 per cent; the group of reactors, boilers, machine tools and equipment and spare parts of the above machines increasing 38.86 per cent; and glass and glass products 1.74 times.

The Việt Nam Association of Seafood Exporters and Producers said that Singapore was among the top five leading markets for Vietnamese tra fish in the first five months of this year.

The Vietnamese Trade Office in Singapore said that it will continue keeping a close eye on policy and mechanism changes in the country and support Vietnamese firms to connect with Singaporean partners and promote their products in the market, while assisting Singaporean firms in exploring trade and investment opportunities in Việt Nam.

Fresh agricultural products have opportunities in Singaporean market

A working delegation from Singapore on July 12 visited agricultural farms in the Mekong Delta province of Long An to learn about food safety management policies, disease control and agricultural export certification process there.

The visit is expected to bring opportunities for local fresh agricultural products to enter the demanding Singaporean market.

The delegation, led by Trade Counsellor and Head of the Vietnam Trade Office in Singapore Cao Xuân Thắng, visited Dương Vũ Limited Liability Company, Hải Âu Farm which grows and exports seedless lemons, and Ba Huân high-tech poultry farm.

The delegation also sought information about manufacturers and businesses with capacities to produce and export poultry, eggs and rice in Long An.

Thắng said that in December 2023, a delegation from the Singapore Food Authority attended the international rice festival in Hậu Giang Province.

Immediately after that, in the first quarter of 2024, Việt Nam for the first time became the largest exporter of rice to the Singaporean market and the 5th largest aquatic product exporter to the country.

Following that visit, the Singaporean side recognised the need to promote the import of other products from Việt Nam, particularly Vietnamese egg products and meat products.

Thắng said that during this visit to Việt Nam, the Singaporean side worked with the Ministry of Industry and Trade, the Ministry of Agriculture and Rural Development, and visited farms and factories in Bình Phước, Tây Ninh and Long An provinces.

He informed that on this occasion, Singapore's management agencies and experts were quite impressed with the farms they visited, showing that that Việt Nam's management model, production scale and disease control are quite good.

However, to meet requirements to export products to Singapore, the authorities of the two sides must continue to work together, Thắng added. 

Dragon Capital divests from Đất Xanh Group

Investment fund Dragon Capital recently reduced its holdings in Đất Xanh Group by selling one million DXG shares.

The transaction took place on July 8, following their active accumulation of the stock from March to April.

As a result, Dragon Capital's ownership stake in Đất Xanh decreased from 11.02 per cent to 10.88 per cent, equivalent to approximately 78.4 million shares.

The trading session on July 8 witnessed a significant sell-off of DXG shares, leading to a 4 per cent decline in the price, which reached a low of VNĐ14,400 per share.

This marked the lowest close since July 2023.

Although DXG experienced a slight recovery, as of July 12, the price remained at VNĐ14,550 per share.

Previously, the property developer underwent notable changes in its senior leadership as Lương Trí Thìn stepped down from his position as Chairman of the Board of Directors on July 3, and was succeeded by Lương Ngọc Huy.

Thìn will assume the role of Chairman of the Strategic Council and continues to be the largest shareholder of Đất Xanh, holding a significant ownership stake of 16.94 per cent.

In the first quarter of 2024, the company achieved a revenue of over VNĐ1 trillion (US$41.8 million) and a net profit after tax of nearly VNĐ78 billion.

As of March 31, the company's total outstanding debt stood at over VNĐ14.1 trillion.

Although the business results in 2023 were not favourable, MB Securities predicts a significant improvement in Đất Xanh's performance in 2024 and 2025.

The projected revenues are expected to reach more than VNĐ3.7 trillion in 2024 and VNĐ4.46 trillion in 2025, accompanied by estimated net profits of VNĐ234 billion and VNĐ440 billion, respectively. 

Securities firms see bright picture for market in July

The Vietnamese stock market is expected to trade positively in July thanks to the second quarter optimistic business results, said insiders.

Việt Dragon Securities Corporation (VDSC) said that the second quarter results will continue to be positive, following improved economic and credit growth since the end of March.

VDSC estimates total market revenue will begin recovering, though at a lower growth rate than the same period last year. Profit after tax growth of the listed enterprises is expected to reach 13 per cent year-on-year, implying improved net profit margins.

However, exchange rate pressure and rising interest rates will remain a burden. Deposit rates have increased 30-50 basis points from end-March, but are still lower than end-2023. Prolonged US dollar strength and high foreign exchange demand could prompt the central bank to raise interest rates in the third quarter.

The securities firm expects the economy's capital absorption capacity to gradually increase, especially towards the end of 2024, causing interest rates to continue rising. They consider an additional 50-100 basis point increase from pre-pandemic levels to be reasonable.

Given the conflicting factors, VDSC believes the market will maintain the volatility seen in recent months.

The second quarter earnings season in July could allow the VN-Index to reach 1,300 points, the securities firm said, adding that exchange rate pressures and potential central bank rate hikes, however, could also push the index back to 1,240 points, or even 1,180-1,220 points in the next quarter.

The benchmark index closed June at 1,245 points, with trading volume declining.

The index's price chart has not yet been able to break through the key psychological resistance level of 1,300 points.

Experts from Yuanta Securities assess that the market is still in a period of strong positive volatility. As a result, they remain optimistic that the VN-Index will soon surpass the 1,300-point resistance level this month.

The forecast is based on the expectation that the US Federal Reserve will cut interest rates in September, which would provide a supportive factor for the market's uptrend in the third quarter. Additionally, positive macro-economic data and second quarter growth reported by listed companies are also expected to bolster the market's upward momentum in July.

Similarly, positive domestic macro- economic factors are expected to support the market in the second half of the year, a report of ABS Research showed.

The analysts note that the recovery in production, consumption, exports and supportive policies for businesses and the public should allow the economy to maintain solid growth. This, in turn, is expected to improve market liquidity and reduce foreign investors' net selling.

In the near-term, ABS forecasts the VN-Index will trade sideways within the 1,170 - 1,300 range, building an accumulation pattern on the daily chart. This consolidation phase in July is seen as preparing the ground for a sustainable upward move above 1,300 points later this year.

According to the latest SSI Research report, the VN-Index has retreated slightly after briefly surpassing 1,300 points in June. Technical indicators like the relative strength index (RSI) and average directional index (ADX) suggest the market may not be as optimistic in July 2024 as previously expected.

However, SSI believes the VN-Index's medium-term uptrend remains intact, as it has not breached the 1,195-1,205 support level. It expects the index to fluctuate in the 1,220-1,295 range this month.

With the mixed factors, SSI advises caution and patience. Investors should wait for attractive price levels while holding on to stocks with strong growth potential. The report also notes potential rotation into sectors like real estate, retail and exports that could benefit from policies. 

Cà Mau Province licenses 14 wind power farms in 2024

Fourteen wind power projects have been approved for investment in the southernmost province of Cà Mau so far this year.

They will have a combined capacity of 800MW.

The province's renewable energy plans envisage having 16 wind power farms.

Four of the 14 have been built and begun commercial production, one has just been completed, three projects and a section of Viên An Wind Farm in Ngọc Hiển District are under construction, and five are finalising construction procedures.

Dương Vũ Nam, deputy director of the provincial Department of Industry and Trade, said Cà Mau would continue to support investors to ensure their wind farms operate stably.

He said it is important to speed up construction to fulfil Cà Mau’s proposed plans to export electricity.

The province has facilitated investment in green, renewable and new energy for domestic use, and exports and production of hydrogen gas and green ammonia, he said.

It has urged investors to accelerate construction of key projects, especially renewable energy plants.

This year Cà Mau expects to increase its installed power capacity by 5.1 per cent to 6.17 million kWh compared to last year. 

PM orders acceleration of public investment disbursement for 2024

The Government Office has issued an official dispatch on Prime Minister Phạm Minh Chính’s directions requiring the acceleration of public investment disbursement for the remainder of the year.

The PM has requested ministries and central and local agencies study the Ministry of Finance’s recommendations and focus on implementing drastic, timely, appropriate and effective solutions to enhance the disbursement of public investment in accordance with their respective functions, tasks and authority.

Standing Government members will preside over a national teleconference with ministries, agencies, economic groups and state-owned enterprises to assess the implementation of the public investment plan for the first six months of this year and to carry out tasks and solutions to boost the disbursement in the second half. The conference is scheduled for July 17.

The PM required ministries, agencies, economic groups and state-owned enterprises to prepare reports evaluating the disbursement situation in the first half, including achieved results, limitations, causes, lessons learned and tasks and solutions to enhance the work in the latter half of 2024.

According to the General Statistics Office (GSO), the disbursement of public investment from the State budget in the first five months of this year was estimated to reach VNĐ190.6 trillion (US$7.44 billion), equal to 26.6 per cent of the yearly target and 5 per cent higher than the same period last year.

Of the sum, investment managed by the government was estimated at VNĐ32.5 trillion, equivalent to 29.3 per cent of the yearly plan, a year-on-year decrease of 2.6 per cent. Some ministries posted estimated disbursement rates lower than those recorded last year, namely the Ministry of Natural Resources and Environment (down 34.8 per cent), the Ministry of Transport (down 19.1 per cent), the Ministry of Health (down 1.5 per cent) and the Ministry of Education and Training (down 1.1 per cent).

The GSO also said that implemented investment capital managed by localities was estimated at VNĐ158.1 trillion, equal to 26.1 per cent of the yearly plan and up 6.7 per cent over the same period last year. 

Banking industry meets 6% credit growth target in H1 2024

Credit by the end of June 2024 increased by about 6 per cent compared to the beginning of the year, reaching nearly VNĐ14.4 quadrillion, a positive signal showing this year's credit growth target of 14-15 per cent is within reach, experts said.

The loans that credit institutions provided to the economy in the first half of 2024 were at the highest level compared to the same period in the past three years, the latest data from the State Bank of Vietnam (SBV) shows.

There was concern that the banking industry would find it difficult to meet the Government’s credit growth target of 5-6 per cent in the first half of 2024, as the credit growth by the end of May this year was only 2.4 per cent. However, credit accelerated in June, especially in the last week of the month (up more than 1.5 per cent), helping the industry meet the target.

Of the total, consumer loans made up more than VNĐ3 quadrillion, accounting for more than 21 per cent of the total.

According to the SBV, the acceleration of credit growth in the last week of June is a normal phenomenon, with credit tending to increase in the second half of a year and decrease in the first months of a year.

Leaders from several banks also explained the acceleration, because in the first half of the year, enterprises often focused on negotiations in the early part of the year, while contracts were mainly signed from mid-year. Therefore, most large credit contracts were also disbursed in the second half.

Experts attributed the high credit growth to recovery in loan demand, promotion in public investment, tax and fee reduction policies and implementation of preferential interest rate lending packages.

Experts forecast loan demand in the second half of this year will continue to accelerate thanks to macro-economic recovery. The manufacturing sector has shown signs of recovery, the industrial production index in the past six months was estimated to increase by 7.54 per cent over the same period in 2023.

Regarding import and export, in the first half of this year, export value reached US$190.73 billion, an increase of 14.9 per cent, while import value reached $178.88 billion, up 17 .3 per cent.

In addition, according to a recent report of credit rating agency FiinRatings, credit growth for the real estate business sector, including investment in real estate corporate bonds by commercial banks, has the potential to recover when legal problems are gradually being resolved. New laws are also expected to create more favourable conditions for the real estate business sector.

Currently, a positive factor for credit growth is that lending interest rates are maintained at a stable level, in spite of a rise of 0.4-1.6 percentage point per year in deposit interest rates in recent months. Commercial banks have so far also affirmed that they will maintain low lending interest rates to stimulate credit demand.

Analysts believe that with the acceleration in loan demand by enterprises in the second half of 2024, the Government's annual credit growth target of 14-15 per cent can be achieved.

MBS Research, a research centre under the MB Securities Joint Stock Company (MBS), forecast that credit growth will hit 14 per cent in 2024, given an expected GDP growth rate of 6.3-6.5 per cent for the year. Drivers for the growth include the recovering consumer finance market, increased credit card usage, robust import-export activities, and high demand for auto loans.

Low lending rates, signs of a reviving real estate market, along with a surge in inventory and land-related tax revenue will also stimulate loan demand in the near future, according to MBS Research.

Echoing the view, the Maybank Vietnam Securities Company (MSVN) held that credit growth since the year's beginning is reasonable and good enough, predicting that credit will accelerate in the third quarter thanks to the real estate market's recovery.

Lê Ngọc Lâm, general director of the Bank for Investment and Development of Vietnam (BIDV), blamed the economy's weak capital absorption on the fact that many businesses were dissolved and businesses’ health declined. However, he expected that credit will grow strongly in year-end months, when businesses get back on track.

Meanwhile, Phạm Chí Quang, director of the SBV's Monetary Policy Department, held that bringing down lending interest rates is a big challenge to the banking system.

To support credit growth, the SBV will continue working to keep interest rates stable and encourage credit institutions to decrease costs and publicise average lending interest rates. It has also issued a circular which allows credit institutions to extend the restructuring of debt repayment deadlines and maintain debt groups for certain sectors until the end of 2024, he added. 

Bank lending gathers pace in HCM City

After a slump, bank credit in HCM City has picked up again and is expected to keep rising for the rest of the year since demand for funds is usually high at year-end, the State Bank of Vietnam has said.

Nguyễn Đức Lệnh, deputy director of the central bank’s HCM City branch, said banks’ outstanding loans as of June end were worth over VNĐ3.68 quadrillion (US$144 billion), 11.06 per cent over the same period last year. Loans outstanding in đồng accounted for 96 per cent.

The growth consolidated a rising trend after 2.03 per cent in June, 0.61 per cent in May and 0.35 per cent in April.

Bank lending has helped promote economic growth, he said.

He said the city economy grew at an “impressive” 6.46 per cent in the first six months of the year.

Low interest rates along with focused credit programmes, preferential credit packages and debt restructuring during the period helped businesses.

Action programmes by the banking industry to support enterprises have promoted credit growth, he said.

Out of a preferential credit package worth VNĐ509.86 trillion registered by 17 banks this year, over VNĐ273.78 trillion has been disbursed to more than 79,300 customers through the bank - business connection programme, he added.

Nguyễn Phước Hưng, permanent deputy chairman of the HCM City Union of Business Associations (HUBA), said businesses in the city have high demand for funds.

Some 45 per cent of businesses surveyed by HUBA want lower lending interest rates and more supportive policies to give them a hand in the context that demand has not completely recovered.

Businesses also wanted banks to “share their difficulties” by continuing to reduce loan interest rates, he added. 

Market fluctuates around the 1,300-point threshold

The stock market experienced a volatile week after a previous strong performance. Improved cash flow supported the VN-Index, which at one point reached 1,297 points. However, selling pressure emerged towards the end of the week, erasing earlier gains.

On the Hồ Chí Minh Stock Exchange (HoSE), the VN-Index closed the week at 1,280.75 points, while the HNX-Index on the Hà Nội Stock Exchange (HNX) ended at 245.02 points.

The former benchmark index recorded a slight fall of 0.18 per cent, while the latter increased by 1.12 per cent.

The average daily transaction value across the market was VNĐ19.5 trillion (US$767.3 million) per session, a significant rise of 16.6 per cent compared to the VNĐ16.7 trillion recorded the previous week.

Foreign investors continued to sell. Last week, they net sold VNĐ4.5 trillion on the HoSE and VNĐ4.68 billion on the HNX.

Phan Tấn Nhật, head of analysis at the Sài Gon-Hà Nội Securities (SHS), pointed out the market's support with the International Monetary Fund (IMF) recognising Việt Nam's rapid economic recovery in the first half of 2024, forecasting growth at 6.4 per cent year-on-year.

According to the IMF, Việt Nam's economy continues to integrate and has significantly recovered, with a growth rate of 6.4 per cent compared to the same period last year. IMF experts expect positive economic prospects towards the end of the year. Additionally, the IMF predicts inflation will remain close to the 4.5 per cent target.

Technically, Nhật noted that the VN-Index experienced a volatile week within a narrow range, facing mild adjustment pressure when approaching the 1,300-point resistance level, corresponding to the peaks in June 2024 and August 2022. The past week's market movements reflected the short-term rotation of cash flow through the alternating recovery of different stock groups.

“The VN-Index has yet to overcome the resistance around 1,285 points, the highest level during sharp declines with a surge in liquidity in April, May, and June 2024,” Nhật added.

In the short term, Nhật believes the VN-Index will continue to consolidate within the 1,250-1,300 point range. After encountering strong resistance around 1,300 points, the index is under adjustment pressure, testing the equilibrium price area of around 1,275 points, corresponding to the 20-day moving average.

In the medium term, Nhật assesses that the VN-Index will continue to accumulate within a narrowing range of 1,245-1,255 points to 1,300 points.

According to Nhật, market liquidity remains low as investors await information on second-quarter business results. On that basis, the market is expected to exhibit positive accumulation (if no new negative factors emerge) and the VN-Index is likely to head towards the resistance around 1,300 points when factors such as global geopolitical tensions, inflationary pressures, exchange rates, and foreign net selling ease.

The analysis team at Vietcombank Securities (VCBS) noted that the VN-Index closing at 1,280.75 points at the end of the past week indicates market hesitation around the old peak area of 1,280-1,290.

On the daily chart, indicators have yet to signal the formation of the first peak, while short-term potential risks have diminished. Although investors remain cautious at this time, selling pressure is not overwhelming, and VCBS expects the VN-Index to regain momentum towards the 1,300-point mark soon.

The VCBS team recommends that investors remain cautious by removing weaker stocks from their portfolios and increasing the proportion of stocks with stable momentum and a positive upward trend. 

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