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According to VASEP, Vietnam’s aquatic exports reached only over 3.2 billion USD in the first five months of the year, falling nearly 30% compared to the same period last year.
The decline ranged from 10% to 50% in all main export markets, with the US experiencing the sharpest decline (50%), followed by the European Union (nearly 32%) and China (over 25%).
VASEP General Secretary Truong Dinh Hoe said the market demand continued to weaken, and supply exceeded demand in the first half of 2023.
He touched upon the situation of the large inventory and weak consumption, saying that importers are limiting their purchases or only importing at lower prices, which has resulted in a drop in the export value of aquatic products.
The domestic consumption demand has not shown a strong recovery due to the reduction or loss of income of consumers as a result of the COVID-19 pandemic, he said.
According to VASEP President Nguyen Thi Thu Sac, the US and China – the two largest importers of Vietnamese aquatic products, have experienced the most significant decline.
Many forecasts stated that the seafood demand in many markets may continue to decline in the third quarter of 2023 instead of recovering as previously anticipated, she added.
Côte d’Ivoire leader suggests specific activities in transport cooperation with Vietnam
President of Côte d’Ivoire’s National Assembly Adama Bictogo suggested that Vietnam and Côte d’Ivoire should enhance their transport cooperation with specific, substantive activities, at his meeting with Transport Minister Nguyen Van Thang in Hanoi on June 15.
Bictogo, who is on an official visit to Vietnam, said the opening of direct flights will make it easier for traders of the two countries to seek and materialise cooperation opportunities.
He added that the two countries should step up collaboration in maritime transportation to optimise their potential in this field.
The leader said he held talks with National Assembly Chairman Vuong Dinh Hue and met with President Vo Van Thuong on June 14, during which they agreed to facilitate payment and the expansion of the network of banking agents in support of the bilateral trade ties, covering the transport sector.
Currently, Vietnam is a big importer of cashew nuts and yarn of Côte d’Ivoire, he said, stressing that Côte d’Ivoire wants to serve as a gateway for Vietnamese electronics and garments-textiles to enter West African nations.
For his part, Thang hailed the Côte d’Ivoire top legislator’s visit as an important milestone in promoting cooperation between the two legislatures in particular and the two countries in general.
The minister noted that Côte d’Ivoire is now Vietnam’s second biggest trade partner in Africa with two-way trade reaching 1.04 billion USD last year, and lauded efforts by the two sides in accelerating negotiations for a bilateral agreement on cooperation in economy and trade.
The agreement will create a foundation for the bilateral economic and trade ties, and a premise for the development of shipping routes, and well as the launch of direct flights between the two countries in the future, he stressed.
Thang said the transport cooperation should be enhanced on par with potential of both countries, thus further facilitating the trade and investment ties.
The two sides agreed to speed up the negotiations and signing of a bilateral air transport agreement, towards the opening of direct flights in order to facilitate socio-economic development and people-to-people exchanges.
At the same time, they will soon hold negotiations on and sign a maritime transport agreement to strengthen cooperation in this field and reduce maritime transportation costs.
The two sides also consented to enhance information sharing, promote the presence and investment of Vietnamese businesses in Côte d'Ivoire, and vice versa.
Vietnam, Czech bolster links between businesses
The Vietnamese Embassy in the Czech Republic and the Czech Chamber of Commerce jointly held a business forum in Prague on June 15 to bolster links between businesses and seek ways to strengthen traditional friendship and multi-faced cooperation of the two countries.
Speaking at the event, Ambassador Thai Xuan Dung praised the sound relationship of the two countries amid complicated developments in the world and impacts of the COVID-19 pandemic. In 2022, two-way trade reached 2.4 billion USD.
Chairman of the Czech Chamber of Commerce Zdenek Zajicek highlighted that the forum is an opportunity for enterprises of both sides to share experience and boost collaboration.
He expressed his hope that the chamber will be a realiable partner to help enterprises of the two countries solve difficulties and barriers in commerce activities by directly pointing out bottlenecks to governments of both sides as well as in the framework of the European Parliament (EP).
For his part, Deputy Minister of Industry and Trade Edvard Kozusnik affirmed Vietnam is the most important partner of the European country in Asia. With an average economic growth of 6-7% in the past two decades and a large market scale, Vietnam is a potential partner of the Czech Republic.
Jan Zahradil, a member of the EP, spoke highly of Vietnam's strong development, saying that the country has a significant role in Southeast Asia region and the Czech Republic hopes Vietnam can act as a bridge so that it can penetrate more in economic activities in ASEAN region.
In addition, he also mentioned the positive effects of the EU-Vietnam Free Trade Agreement (EVFTA) which helps strengthen trade relations between Vietnam and the EU in general, and with EU member states in particular.
The trade accord can be a model for further agreements between the EU and other countries, he added.
Participants at the forum exchanged ideas and information about the two countries' markets with focus on potential cooperation areas as well as seeking measures to remove difficulties and obstacles in the implementation of cooperation and connection between enterprises of the two countries.
Digital transformation, green transition – key to improve competitiveness of economy
Digital transformation and green transition would help Viet Nam improve productivity, quality and effectiveness and competitiveness of the national economy, emphasized Prime Minister Pham Minh Chinh.
The Prime Minister made that above statement at the plenary session of the annual Viet Nam Industry 4.0 Summit 2023 held in Ha Noi on June 14.
From that perspective, the Government chief underlined that Viet Nam needs to effectively implement the National Digital Transformation Program through 2025, with an orientation towards 2030, the National Green Growth Strategy for 2021-2030, vision to 2050, and the Political Declaration on establishing the Just Energy Transition Partnership (JETP).
JETP should be an important solution for energy transition in Viet Nam, Prime Minister Pham stressed.
It is also necessary to successfully realize the National Power Development Plan for 2021-2030, with a vision to 2050 in a bid to achieve net-zero emissions by 2050 as pledged at the COP26, Pham said.
He called for building a roadmap to improve mechanisms and policies to boost green energy transition and ensure national energy security.
The Government of Viet Nam commits to actively working with countries and international organizations to promote digital transformation and green growth, contributing to peace and prosperity of all nations around the world, Prime Minister Pham said./
EuroCham proposes solutions to ongoing power shortages
The European Chamber of Commerce in Vietnam (EuroCham) wrote a letter to the Ministry of Industry and Trade (MoIT) to propose a series of short- and long-term measures designed to alleviate the effects of the ongoing power shortages.
EuroCham and the broader business community have expressed growing concerns regarding ongoing power shortages in Hanoi and northern Vietnam. Many European companies with production and manufacturing facilities in the region, including numerous EuroCham members, have been adversely affected. Swift action is imperative to preserve Vietnam’s reputation as a global supplier.
EuroCham's vice chairman Jean-Jacques Bouflet, in an interview with Reuters, expressed his concerns about the situation and emphasised the need for urgent measures from the MoIT. "To tackle this urgent issue, EuroCham has intensified our advocacy efforts by writing a letter to the MoIT and proposing a series of short- and long-term measures designed to alleviate the effects," said Bouflet.
EuroCham is advocating for more communication, ensuring affected companies receive advance notice of scheduled power cuts. By providing specific schedules and durations of power interruptions, businesses will have the opportunity to make necessary arrangements and effectively minimise disruptions to their operations.
"This proactive approach ensures that affected companies are well-informed and can prepare accordingly, mitigating the negative impact on their productivity and minimising financial losses," added Bouflet.
The group strongly advocates for the prioritisation of electricity production and emphasises the need for promoting the development of additional sustainable capacities, such as solar panels, without imposing undue bureaucratic restrictions.
While these short-term measures are crucial for addressing the current power shortage, EuroCham underscores the importance of long-term solutions. The MoIT is being urged to concentrate on renewable energy projects and foster a diversified energy portfolio that can withstand various climate conditions. This approach will contribute to a sustainable future and mitigate power shortages regardless of climatic conditions.
"EuroCham is committed to keeping a close eye on any new developments and ensuring that our members are promptly updated on the progress made regarding this issue. Rest assured, we will continue to provide timely and relevant updates on this matter," said Bouflet.
Vietnamese enterprises’ major post-COVID challenges named
A new report by Prime Minister’s Advisory Council for Administrative Procedure Reform has identified nine groups of challenges that enterprises in Vietnam are facing in the coming time.
They include the increase of inflation rate/prices of goods and materials; the risks of crisis and increasing costs that suppliers suffer; the insufficient quality of human resources; the improper logistics services; the labour shortage; the changes and lack of transparency in regulations related to governance/environment/society; the technology/digital and cybersecurity-related risks; the ethical/legal/reputational risks of distributors/intermediaries and agents; and difficulties for business to access bank capital.
The report on evaluation of support policies for enterprises impacted by the COVID-19 pandemic was conducted with data provided by 355 enterprises in 46 localities across the countries, nine business associations in Ho Chi Minh City and Hanoi, and 11 State agencies.
Findings show signs for the recovery of businesses in 2022 and positive growth of 10.4%. However, the growth was achieved thanks to the low starting effect caused by the sharp decline during the pandemic. According to the report, the actual growth in 2022 is 0.8% compared to 2019, which nearly reached the level before the epidemic. So, it raised the need for Government to take measures to support and promote the growth rate in the subsequent years.
The report was carried out through the technical assistance project to promote reforms and enhance linkage for small- and medium-sized enterprises (LinkSME) of the United States Agency for International Development (USAID).
LinkSME supports research and evaluation of the effectiveness of these policies to seek lessons in the design and implementation of government support programmes and policies.
The report is expected to make recommendations to the Prime Minister and the Government on amendments to the business support programmes and policies.
Japanese firm to build US$200 million electronic circuit factory in Hoa Binh
Meiko Group of Japan recently unveiled a plan to invest in a factory producing all kinds of electronic circuits in the northern province of Hoa Binh, according to details given by local authorities.
The group is therefore proposing that it will lease the land and infrastructure of Da Hop Trading Joint Stock Company, the main investor of Da River Left Bank Industrial Park, in order to build the US$200 million factory.
A representative of local authorities affirmed that the provincial leaders have fully committed to creating the optimal conditions possible for the Japanese firm to operate efficiently within the locality.
Meiko represents one of the leading corporations in the production of electronic boards and assembly of complete electronic boards. It operates five factories in Japan along with an additional two in China.
The group has been officially pouring investment into the Vietnamese market since 2006 with a factory located in Thach That Industrial Park in Hanoi.
At present, the corporation has built three factories manufacturing and assembling electronic circuit boards with a total investment of US$500 million, thereby generating more than 7,000 jobs and contributing roughly US$30 million to the state budget each year.
Promising outlook for exports as global markets show signs of recovery
Vietnamese export activities are expected to rebound in the second half of the year, provided that businesses swiftly interpret market signals and seize upon export opportunities.
Vietnam has exported nearly 3.9 million tonnes of rice during the first five months of 2023, earning US$2.02 billion, up 40.8% in volume and 49% in value year on year.
The Ministry of Industry and Trade (MoIT) reports that in the past five months, the country’s export revenue stood at US$136.1 billion, reflecting a decline of 11.6% over the same period from last year.
Along with a decrease in export orders, a fall in export goods prices can also be considered one of the factors leading to the five-month export turnover to nosedive.
With the exception of rice, coffee, and coal, the average export prices of tea, cashew nuts, pepper, rubber, and fertilizer dropped by 7.9%, 1.5%, 34.3%, 21.1%, and 35.2%, respectively.
The majority of industries have faced difficulties in their export markets due to decreasing demand globally. Industries such as textiles-garments, footwear, wood, and seafood endured the biggest decline in exports to major export markets such as the United States and the EU.
It is noteworthy that a number of export items, including seafood, wood and wood products, iron and steel, and plastics are coping with pressures from trade remedy investigations. The increased cost of input materials has also impacted the overall competitiveness of Vietnamese goods in export markets.
Though Vietnam enjoyed a trade surplus of US$9.8 billion during the first five months of the year, businesses specialising in textiles-garments, footwear, and woodworks struggled to look for export orders.
The MoIT forecasts that export activities are likely to recover strongly ahead in the second half of this year as inventories of goods in major markets, especially in the US, are decreasing significantly, with importers showing signs of placing orders again.
In the US, which is Vietnam’s largest import market for goods, its major retailers have released most of their excess inventory and are in the process of preparing to replenish their shelves with new goods. This will therefore open up opportunities for Vietnamese businesses to cash in on this lucrative US market in the second half of the year following many months of consecutive decline.
With inflation beginning to cool down in some markets, experts and managers anticipate that this represents an opportunity for export of consumer goods to recover over the coming months.
“The current decline is mainly due to problems from the market perspective, but in Vietnam businesses maintain their production capacity without any impact of factors such as COVID-19. This is an advantage to help businesses to stay ready for new export orders when the market rallies,” says Tran Thanh Hai, deputy head of the Import-Export Department under the MoIT.
Vietnam has signed 15 free trade agreements (FTAs) with regional and global partners, although its exports to FTA markets account for only about 2% of the total imports of these markets.
Of the market share, more than one third of export products take advantage of tax incentives and origin of goods. Therefore, there remains plenty of room for Vietnamese businesses to transform their production structure and increase the value of their products in potential markets.
In order to support businesses, the MoIT closely monitors any developments in the world market and seeks solutions aimed at simultaneously developing traditional outlets and diversifying export markets.
It recommends that businesses take fully advantage of the signed FTAs in order to effectively exploit markets and increase exports. To this end, it holds monthly trade promotion conferences and provides market information in a bid to iron out any snags.
Furthermore, the Ministry seeks to develop markets in Northern Europe, Eastern Europe, Latin America, and new markets that still have room for exploitation. At the same time, it is accelerating the negotiation of new FTAs with Brazil, Argentina, Uruguay, and Paraguay, while taking advantage of the rapid recovery of markets in ASEAN and some Asian countries to boost exports.
Building a pilot mechanism for circular economy is essential for ‘green development’, experts
The development of the circular economy aims to create impetus for innovation and improve labour productivity, contributing to achieving economic development, environmental sustainability and social equality, according to economic experts.
This was one of the many messages raised at the forum of Regulatory Sandbox for Circular Economy Development.
Dr. Trần Thị Hồng Minh, director of the Central Institute of Economic Management (CIEM), said: “In order to soon realise benefits from the circular economy, generating a driving force for businesses and investors to transform and create a circular economy model is particularly important, especially for a number of potential industries and fields such as agriculture, industry, energy, and building materials.”
Decision No. 687/QD-TTg in 2022 approving the project of circular economy development in Việt Nam is one of the first and important efforts to determine the roadmap, requirements and orientation need for economic growth in Việt Nam, the director told the forum.
Co-hosted by the CIEM and the German International Co-operation Agency (GIZ) in Việt Nam yesterday in Hà Nội, the aim of the forum was to assess the challenges and obstacles as well as propose policies for the circular economy in Việt Nam in the future.
According to Nguyễn Anh Dương, head of CIEM's Research Department, the circular economy is toward a green, carbon-neutral economy and contributes to the goal of limiting global temperature rise.
However, Việt Nam is also facing big challenges in terms of resource depletion, environmental pollution and climate change, Dương said.
These challenges also require Việt Nam to take a more serious look at the requirements of sustainable development, increase the level of independence and autonomy of the economy and the resilience of the supply chain, which, promotes the development of a circular economy model is one of the important solutions and directions in line with the orientation that many countries around the world are approaching and transforming, he said.
Meanwhile, Dr. Minh said that due to the circular economy associated with new design thinking, innovative applications and related to many different policy areas, the traditional, sequential approach to completing relevant policies is necessary but not enough.
It is necessary to quickly create new impetus for businesses, investors and employees through policies to promote "green recovery" in the context of economic recovery and serious difficulties for economic sectors of agriculture, industry, energy, and construction materials in the first months of this year, Minh said.
Accordingly, an important task to soon concretise these orientations is to issue a decree on a pilot mechanism for circular economy development.
The formation of a solid legal basis for circular economy development will also help concretise contents of international cooperation related to the circular economy including green energy transformation and agriculture.
Speaking in the forum, Dương affirmed that in economies that use many natural resources, a transition towards a circular economy can offer many opportunities to pursue economic diversification and access higher-value markets.
Along with that, international cooperation plays a very important role in accessing, applying and mastering science-technology and innovation in circular economy development, Dương said.
And the policies to support enterprises participating in the implementation of circular economy projects are essential, he said.
The goal of policy formulation is to encourage investors and businesses to early testing ideas and initiatives of the circular economy contributing to the “green transition and recovery” in Việt Nam.
Through sharing perspectives on the current situation, barriers and recommendations for appropriate policies for the development of the circular economy in Việt Nam, CIEM hopes to soon propose an effective testing mechanism to develop a circular economy in the coming period, Minh said.
High quality products with clear origins attract consumers
Consumers now not only focus on the quality and price of goods but are increasingly interested in safety and clear origins of the products.
Consumer habits have changed in recent years because the development of supermarkets, trade centres or genuine agents has helped consumers pay more attention to products with safety, brand, and clear origin and geographical indication. That means the Vietnamese consumption goods market is gradually developing quality.
According to a survey on high-quality Vietnamese goods in 2023 recently announced by The Business Association of High Quality Vietnamese Products, for a number of industries such as food and beverage, consumers pay more attention to the safety of products, and clear information about quality and manufacturers.
The survey on Consumption Habits 2023 of PricewaterhouseCoopers (PwC) also shows that although people are planning to reduce spending and the economy is still facing difficulties, consumers are still willing to pay more for products that are made by reputable companies.
The safe agricultural products weeks of Son La Province earlier this month and those similar weeks of other provinces and cities at Big C Thang Long are opportunities for the residents in Ha Noi to enjoy speciality products that meet VietGAP, GlobalGAP, OCOP, organic food safety standards of those localities such as plum, mango, jackfruit, longan and dragon fruits.
According to Nguyen Thi Bich Van, communications director of Central Retail Group, the consumers have highly appreciated those products at Central Retail's food retail system (GO!, Big C, Tops Market).
About 60 kinds of agricultural products from Son La Province are regularly sold on the shelves of 18 supermarkets GO!, Big C, and Tops Market in the North.
In 2022, the amount of Son La's agricultural products in Central Retail's supermarkets increased by 20 times, even some items like cabbage grew by 80 times, she said.
Ma Thi Ninh, director of Yen Duong Cooperative in Bac Kan Province, said that the cooperative has always focused on the quality of safe products. Now, it has three OCOP products at the provincial level, ash gourd, sticky rice and vermicelli.
The Yen Duong Cooperative's products are manufactured and processed according to safe processes with traceability stamps. It will continue following this goal in the future.
Similarly, after being granted a geographical indication, the value of Shan tuyet tea products of Son Tra Cooperative in Hong Thai Commune, Tuyen Quang Province has increased, and it also has attracted more consumers.
Dang Ngoc Pho, deputy director of the Son Tra Cooperative, said that in the past, Hong Thai Shan tuyet tea was mainly supplied to the provincial market. Now it is marketed in big cities such as Ha Noi, Hai Phong and Da Nang.
Acting director of Ha Noi Department of Industry and Trade Tran Thi Phuong Lan said the consumers in the capital as well as nationwide prefer speciality products with clear origins, brand, geographical indication and good quality, so they are willing to accept higher prices than similar products in the market.
In the context of deepening integration, many businesses are producing standardised products to encourage consumers to choose Vietnamese products, Lan said.
When the market has fierce competition, transparency of information and origin, and product quality are advantages for businesses in increasing brand value and revenue, and gaining a strong position in the market, she said.
According to Lan, Ha Noi People's Committee has also issued an action plan and implemented solutions to promote organic production and strengthen linkages between the production and supply of goods under chains.
Two BOT toll stations in Dong Nai, Binh Duong removed
Functional forces this morning removed a BOT (Build-Operate-Transfer) toll station in National Highway 1K, Hoa An Ward, Bien Hoa City, Dong Nai Province under the renovation and upgrade project of National Highway 1K.
The renovation and upgrade project of National Highway 1K was implemented at a section from km 2+487 to km 12+971 through three localities of Dong Nai, Binh Duong and Ho Chi Minh City under the form of BOT.
The project has two toll stations which were installed at Dong Hoa Ward, Di An City of Binh Duong, and at Hoa An Ward, Bien Hoa City of Dong Nai Province.
By the morning of June 12, the dismantling of the toll booths was almost completed, and road workers painted traffic lines and median trips at the sections above. The dismantling of toll booths is almost completed.
It is expected that the functional forces will dismantle the BOT toll station on National Highway 1K's section in Di An City in Binh Duong Province tomorrow.
Previously, on October 31 of 2020, two BOT toll stations on National Highway 1K were suspended operation and abandoned, causing risk of traffic unsafety so Dong Nai Province proposed to the Ministry of Transport to remove them soon.
The renovation and upgrade project of National Highway 1K has a total investment of VND397 billion (US$16.9 million). The project investment will be refunded through toll collection within 17 years. Of which the payback period is 14 years with toll collection through the toll plaza in Dong Nai province from October 22 of 2007 and in Binh Duong province from February 28, 2008.
Raw shrimp price dropping sharply in Mekong Delta
The prices of raw shrimps in the Mekong Delta are nearly reaching the bottom, causing great loss to farmers.
Market reports in Kien Giang Province yesterday revealed that the prices of black tiger shrimps decreased by VND30,000 – 40,000 per kilo (US$1.28 – 1.7) to only VND250,000 – 95,000 per kilo ($4 – 10.6). The prices of white-leg shrimps also reduced by VND20,000 – 30,000 per kilo ($0.85 – 1.28) to only VND60,000 – 73,000 ($2.55 – 3.1).
The situation in other provinces of the Mekong Delta like Ca Mau, Bac Lieu, and Soc Trang is similar, facing a shrimp price decline by 40 percent compared to the beginning of the year.
President Tran Van Viet of Thanh Cong Shrimp Cooperative in Dam Doi District of Ca Mau Province stated that despite that discouraging price drop, animal feed costs are still rather high, which leads to profit loss for farmers. He stressed that if this continues, farmers will have to stop operation to cut loss.
The Vietnam Association of Seafood Exporters and Producers (VASEP) gives reason for this price reduction, saying that exports have decreased lately, and the inventory is still too large for shrimp processing businesses to buy more materials.
Raw shrimp price dropping sharply in Mekong Delta
The prices of raw shrimps in the Mekong Delta are nearly reaching the bottom, causing great loss to farmers.
Market reports in Kien Giang Province yesterday revealed that the prices of black tiger shrimps decreased by VND30,000 – 40,000 per kilo (US$1.28 – 1.7) to only VND250,000 – 95,000 per kilo ($4 – 10.6). The prices of white-leg shrimps also reduced by VND20,000 – 30,000 per kilo ($0.85 – 1.28) to only VND60,000 – 73,000 ($2.55 – 3.1).
The situation in other provinces of the Mekong Delta like Ca Mau, Bac Lieu, and Soc Trang is similar, facing a shrimp price decline by 40 percent compared to the beginning of the year.
President Tran Van Viet of Thanh Cong Shrimp Cooperative in Dam Doi District of Ca Mau Province stated that despite that discouraging price drop, animal feed costs are still rather high, which leads to profit loss for farmers. He stressed that if this continues, farmers will have to stop operation to cut loss.
The Vietnam Association of Seafood Exporters and Producers (VASEP) gives reason for this price reduction, saying that exports have decreased lately, and the inventory is still too large for shrimp processing businesses to buy more materials.
Ceiling price of air tickets proposed to surge
The Ministry of Transport is receiving opinions on adjusting articles on Circular No.17/2019 regarding the price range for passenger transportation services on domestic routes.
Of which, the airline tickets in some routes are proposed to increase over the current price tag.
Pursuant to the new draft circular, the transportation service price for route distances under 50 kilometers will remain unchanged over the Circular No.17.
Of which, the ticket prices on flight routes for socio-economy development shall peak at VND1.6 million (US$68.2) per ticket per way. On other flight routes under 500 kilometers, the price will be VND1.7 million (US$72.5) per ticket per way in maximum.
Besides, air freight for routes from 500 kilometers to under 850 kilometers is proposed to be at its peak of VND2.25 million (US$96) per ticket per way, increasing VND50,000 (US$2.1) over the current price.
Meanwhile, air freight for routes from 850 kilometers to under 1000 kilometers is proposed to peak at VND2.89 million (US$123) per ticket per way, increasing VND100,000 (US$4.3) over the current price.
As for air freight for routes from 1000 kilometers to under 1,280 kilometers, the service is set to reach VND3.4 million (US$145) in maximum, surging more than VND200,000 (US$8.5) over the currently applied benchmark.
On the other hand, the air freight for routes from 1280 kilometers is proposed to be at its peak at VND4 million (US$171) per ticket per way, increasing VND250,000 (US$10.7) over the current price.
Central region seeks ways to lure more Islamic tourists
A workshop on developing a supply chain of tourism services for Islamic visitors in central Vietnam opened in the central beach city of Da Nang on June 10.
Jointly organized by the Malaysia Tourism Promotion Board in Vietnam, the Islamic Tourism Center under the Ministry of Tourism, Arts, and Culture of Malaysia, and the Da Nang Department of Tourism, the event saw the participation of representatives of more than 100 enterprises in the sector in three central localities, namely Thua Thien-Hue, Da Nang and Quang Nam.
Nguyen Son Thuy, Director of Duy Nhat Dong Duong Tourism Limited Company, said that Vietnam has welcomed many Muslim tourists in recent years, but the sector has yet to enjoy due attention.
Deputy Chairman of the Da Nang Department of Tourism Nguyen Xuan Binh said the city has developed several plans to attract more tourists following the Covid-19 pandemic, and this market sector is seeing a chance to further expand.
According to Marina Muhamad, Director of the Islamic Tourism Center, Da Nang should pay attention to special services catering to the needs of Islamic tourists such as praying areas and Halal food.
Delegates at the event exchanged ideas on trends and consumption habits in tourism among Islamic tourists and Halal culinary services.
There are about 1.8 billion Muslims in the world, the ASEAN region accounts for 255 million. Recently, the early reopening of direct flights between Da Nang and Singapore, Malaysia, and India has created favorable conditions for the number of foreign tourists visiting Da Nang to grow strongly in Southeast Asia.
Southeastern localities boost linkages for regional tourism development
A conference on finding new ways for the tourism sector’s development in Ba Ria – Vung Tau Province and the Southeastern region was held in Vung Tau City yesterday.
The Ba Ria – Vung Tau Tourism Association collaborated with Tuoi Tre Newspaper to host the event.
According to the Ba Ria – Vung Tau Tourism Association, the Southeast region gathers a diversity of tourism resources to develop in various forms. However, during the passing time, the tourism sector of the region has been still limited without any new tourism products, typical ones and the linkage among localities and units was not really closed.
At the current time, the key tourism localities such as Binh Thuan and Khanh Hoa have formed new and diverse tourism products in synchronization with infrastructures and transport systems including Dau Giay – Phan Thiet Expressway, Phan Thiet – Nha Trang Expressway which would be more attractive than Ba Ria – Vung Tau.
Speaking at the conference, General Director of the Vietnam National Administration of Tourism Nguyen Trung Khanh agreed that the tourism activities in the Southeast region were not really adequate with the region’s potential. Therefore, the provinces and cities needed to smoothly collaborate and promptly give practical solutions to develop the smokeless industry heading to green and durable ways.
VND600 billion proposed for riverside embankments in HCMC
The Transport Department of HCMC has proposed using VND600 billion from the municipal budget to construct three embankment projects to address riverbank landslides.
The Can Giuoc, Cho Dem, and Saigon embankment projects are among 11 projects submitted by the department to the HCMC People’s Committee. The proposal will be presented for approval at the forthcoming city council meeting scheduled for July.
The project locations have been identified as having a high risk of landslides, which poses a threat to surrounding residential properties. The Can Giuoc embankment in Binh Chanh District is the largest among the three as it requires an estimated VND274 billion. The section at risk of landslides spans about 160 meters in length and seven meters in width.
The Cho Dem embankment project, also in Binh Chanh, needs VND233 billion. The section vulnerable to landslides measures around 200 meters in length and four meters in width.
The remaining project is situated in Binh Thanh District, with a total investment of VND106 billion. The section susceptible to landslides covers around 100 meters in length and seven meters in width.
The city currently has 32 areas across various districts deemed to be at high risk of landslides, posing a threat to over 1,300 households. Thu Duc City has the highest number with eight sites, followed by Nha Be and Can Gio districts with seven each. Binh Thanh and Binh Chanh districts have four each, while Hoc Mon and Cu Chi districts have one each.
Construction Ministry to aid real estate market recovery
Prime Minister Pham Minh Chinh has instructed the Ministry of Construction to assist in revitalizing the long-dormant real estate market, as current reports indicate that only 30-40% of property brokerages are able to remain operational.
During the Government meeting held in May, the ministry, along with relevant agencies, was tasked with streamlining paperwork for eligible real estate projects.
Furthermore, it was directed to collaborate with the Ministries of Public Security and Natural Resources-Environment to finalize a web portal dedicated to housing and the real estate market, connecting the land database with the national population database by June.
Market watchers suggest that the woes faced by the real estate sector could impact other businesses and the economy as a whole, given the interdependent relationships between real estate, insurance, banking, and securities.
According to a market report released by the Vietnam Association of Realtors (VARS), 554 real estate companies have pulled out of the market in the first five months of the year, a 30.4% increase compared to the same period last year.
The number of new entrants into the market has also plummeted by a staggering 61.4% compared to last year, with a total of 1,744.
“The escalating inventory, coupled with a sharp decline in income, have compelled developers to halt operations due to insufficient resources to complete half-done projects and have resulted in staff layoffs to reduce costs,” stated VARS in its report.
During the first five months of the year, property transactions were woefully insignificant, with only 19,000 transactions recorded during this period, equivalent to 17% of the total in 2018.
If the current situation persists, VARS predicts that by the end of the third quarter, 23% of the country’s real estate firms may exit the market, and only 43% would be able to resume operations by the end of the year.
Should the circumstances continue unchanged, nearly one-fourth of the real estate companies in the country may withdraw from the market by the third quarter, with only 43% able to sustain their operations until the end of the year.
MoF urgently orders inspections at four life insurance companies
The Ministry of Finance (MoF) has just assigned the Insurance Supervisory Authority the urgent task of conducting inspections at four insurance companies, namely Prudential Vietnam Life Insurance, MB Ageas Life Insurance, BIDV Metlife Life Insurance, and Sunlife Vietnam Life Insurance.
Upon request, the Insurance Supervisory Authority will collaborate with the Government Office to provide explanations and gather the opinions of government members regarding the decree detailing certain provisions of the Law on Insurance Business.
Additionally, they are seeking an assessment from the Legal Department to finalise the draft circular guiding certain articles and measures for the enforcement of the Insurance Business Law.
Furthermore, the MoF has instructed the Insurance Supervisory Authority to continue conducting inspections at insurance companies included in the approved inspection plan for 2023. Simultaneously, they are urgently coordinating with the State Bank Inspection and Supervision Agency to finalise and implement the coordination regulations.
Of particular importance among these tasks, the Insurance Supervisory Authority must promptly report to the MoF the results of a specialised examination on insurance sales through banks and credit institutions conducted at Manulife Vietnam.
This comes after Manulife Vietnam announced in a press release on June 5 that it has prioritised addressing numerous customer complaints related to the Tam An Dau Tu insurance product offered in collaboration with the troubled lender Saigon Commercial Bank (SCB).
According to the announcement, since the initiation of direct dialogue to resolve SCB customer complaints on April 26, Manulife Vietnam has successfully resolved nearly 60 per cent of the complaints and is currently addressing the remaining 40 per cent. Manulife Vietnam is committed to closely cooperating with the relevant authorities to swiftly resolve these issues.
Previously, Lieutenant General To An Xo, official spokesperson for Vietnam’s Ministry of Public Security, noted that Manulife has demonstrated its commitment to resolving this problem by refunding a large sum of over VND800 billion ($34 million) as of May 31.
Manulife Vietnam is currently working towards resolving 2,507 contracts that are subject to a complaint.
Further fall projected for interest rates
Several banks have followed the State Bank of Vietnam’s (SBV) lead by lowering their base interest rates, aiming to encourage and facilitate increased credit demand within the market.
Techcombank last week announced adjustments to its base interest rate, resulting in a reference rate of 8.8 per cent per annum for individual customers seeking real estate, car, and consumer loans with terms ranging from one to five years.
For projects, Techcombank’s base interest rate varies between 8.65 and 9.25 per cent for the same term range, while the reference interest rate stands at 9 per cent.
Earlier, Sacombank initiated an early base interest rate adjustment, reducing it by 0.4 per cent compared to the beginning of the year for terms of one month or longer.
Several other banks, including MSB and ABBank, have undergone similar adjustments, resulting in a cooling effect on savings interest rates across various terms.
Based on data from VNDirect Securities, the private banking sector has experienced significant drops in the average savings interest rates for 3-month and 12-month terms.
Since the beginning of May, these rates have decreased by 57 and 28 basis points, respectively. Similarly, state-owned banks have observed an 80bps decrease in the 3-month term and a 40bps decrease in the 12-month term for average deposit rates.
Economist Dinh Quang Hinh anticipates that the average 12-month deposit interest rate will decline to 6.5-6.7 per cent per annum by the end of 2023.
Experts from SSI Securities shared a similar perspective, suggesting that deposit rates may drop by an additional 50-100 bps from now until the end of the year, with further decreases expected in 2024.
Nguyen Hung, CEO of TPBank, said that the bank had continued to reduce lending interest rates by 0.3-0.8 per cent since the beginning of June.
A representative from BVBank told VIR, “BVBank took proactive measures by reducing interest rates on April 19, thereby aligning its current interest rates with the newly established regulations set by the central bank. This strategic move aimed to provide support and assistance to BVBank’s clientele.”
According to Mirae Asset Securities, a continued reduction in the deposit ceiling rate by 0.5 per cent would yield positive repercussions for industries burdened with substantial short-term and long-term debt obligations.
Drawing from comprehensive data analysis encompassing the conclusion of 2022, it is evident that five industries – real estate, steel production, food processing, agriculture and aquaculture, and construction – currently exhibit elevated borrowing levels. Consequently, these sectors are poised to derive significant benefits in the immediate future as a direct outcome of the interest rate reduction.
SBV Deputy Governor Pham Thanh Ha highlighted the effectiveness of the operating measures undertaken from March to May, leading to a decrease in interest rates. Recent data indicates that average lending rates for new loans currently stand at approximately 9.07 per cent, representing a 0.9 per cent decline compared to the end of the previous year.
Bui Nguyen Khoa, head of Market Analysis at BIDV Securities, believed that interest rates cut serves as a significant supporting factor in accelerating the stock market’s recovery process after a downward cycle. The decrease in interest rates will to some extent attract investors, thereby improving overall market liquidity.
Small-scale projects still in ascendency
Foreign-invested projects that are valued at less than $1 million continue to make up the majority of ventures as a whole, with enterprises often hedging their bets in terms of diversification and the upcoming global tax overhaul.
According to figures published by the Foreign Investment Agency (FIA) under the Ministry of Planning and Investment, the five-month number of new projects worth less than $1 million accounted for nearly 70 per cent of the total number of foreign-invested projects registered in the country, but the value only makes up 2.2 per cent of the total.
The Vietnam Association of Foreign-Invested Enterprises (VAFIE) predicts that the inflow of smaller ventures will continue to occur unless domestic firms create enough competition capacity to replace this domination.
The FIA evaluated that the growth rate of new projects has been much larger than the total investment, which shows that small- and medium-sized enterprises continued to pay attention to and had confidence in the investment climate of Vietnam to expand operations. Another reason cited is that large corporations were considering their business regarding the impact of the upcoming global minimum tax policy.
Regarding the issue of micro-projects taking up the majority of activity, Toan of the VAFIE said that large manufacturers want to create opportunities for their satellite companies, and to ensure the stability of their production chain.
FIA statistics showed that big foreign investors often focus on the larger cities and provinces, such as Hanoi, Ho Chi Minh City, Dong Nai, Bac Ninh, Bac Giang, Binh Duong, and Vinh Phuc.
Meanwhile, many localities such as Yen Bai, An Giang, Kien Giang, Hoa Binh, and Hau Giang saw no newly registered or expanded projects in the first five months of this year. Meanwhile, Quang Tri and Ben Tre provinces only witnessed adjusted capital projects with added capital of $300,000 and $500,000 per project, respectively.
Vietnam Airlines launches Hanoi-Melbourne direct route
National flag carrier Vietnam Airlines on June 15 officially launched a direct route between Hanoi and Melbourne of Australia, with two round-trip flights per week on Thursdays and Sundays.
Accordingly, the first flight departed from Hanoi in the early morning, and arrived in Melbourne in the afternoon, after nine hours. The plane then returned from the second biggest city of Australia at 3pm (Melbourne time) and will land in the capital of Vietnam at 9:35pm (Vietnam time) the same day.
Deputy Ambassador of Vietnam to Australia Tran Le Phuong expressed his delight at the opening of the direct air route, considering it a significant event in 2023 when the two countries are celebrating the 50th founding anniversary of diplomatic ties.
In the context of increasing travel demand between the two sides, the opening of the Hanoi - Melbourne route helps to further facilitate travel between the two cities in particular and the two countries in general, contributing to promoting bilateral exchanges and cooperation.
Nguyen Huu Tung, Chief Representative of Vietnam Airlines in Australia, said that in November, the airline will increase the frequency to three flights per week, and is considering the opening of more routes to Perth of West Australia state and the Northern Territory’s Darwin, and a route from Ho Chi Minh City to Queensland state’s Brisbane.
With the new route opening, Vietnam Airlines is operating the largest number of direct air routes with the highest frequency between Vietnam and Australia – four routes with 18 flights per week connecting Hanoi and Ho Chi Minh City with Sydney and Melbourne.
In 2019, before the COVID-19 pandemic broke out, Australia was the 12th biggest aviation market of Vietnam with nearly 900,000 passengers, over 400,000 of whom were served by Vietnam Airlines.
Last year, though some regional and international markets did not fully recover yet, Australia ranked eighth among the sources of international air passengers of Vietnam.
The country is now at the fourth place among the most important markets of Vietnam Airlines, according to the carrier.
Source: VNA/SGT/VNS/VOV/Dtinews/SGGP/VGP/Hanoitimes
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