Future business support policies in the recovery period should focus on the right subjects and provide appropriate support contents to ensure their highest efficiency, according to experts.

According to a report on the evaluation of the efficiency of support policies to enterprises affected by the COVID-19 pandemic, which has been released by the Prime Minister’s Advisory Council on Administrative Procedure Reform, among the 33 business support policies applied in 2020, those on tax, fee, charges, employment, labour, and insurance benefit businesses the most.

The access rate to these policies groups was more than 50% of the total number of the 355 surveyed businesses.

The proportion of enterprises benefiting from the policies to the total number of enterprises having access to them was 72% and 76.3%, respectively, said the report.

Meanwhile, it said that the access rate to policies in finance-credit, export promotion and supply chain protection was only at less than 20%.

However, the rate of businesses benefiting from them was at 44% and 76.3%, respectively.

The report showed the negative relationship between the rate of enterprises accessing and benefiting from policies and the effectiveness of policies.

According to the Advisory Council, in the time to come, new business support policies should target businesses and individuals severely affected by the pandemic from the prevention and control phase to the "new normal" period, due to changes in demand for goods, services and investments in the world.

The support packages in finance-credit, export promotion - supply chain protection are still essential for businesses affected by the pandemic, the council added.

Trade forum enhances Vietnam - Algeria business connectivity

As many as 13 Vietnamese enterprises and 25 Algerian firms gathered at a direct and virtual trade exchange programme held on June 18, aiming to strengthen connectivity and seek additional business opportunities.

At the event, Algerian businesses were introduced to the Vietnam-Algeria relations and prospects for bilateral trade cooperation. They inquired into Vietnamese product samples and praised the quality of Vietnamese products compared to those from some countries in Asia.

Aside from the demand that exists for importing agricultural products, solar cells, auto parts, shoes, powdered milk, and fabrics, Algerian businesses showed their keen interest in exporting items such as olive oil, flavorings, chicken feet, lobster, and sea cucumbers to the Vietnamese market.

Representatives from numerous Algerian companies also called for Vietnamese businesses to invest in the North African nation, particularly in poultry farming, aquaculture, and construction.

The two sides expressed their desire to increase direct transactions, while discussing issues related to safe import-export payment measures, and logistics in international trade activities.

The Vietnam Trade Office also invited Algerian businesses to visit the Vietnamese booth at the 54th Algiers International Fair (FIA 54) which is scheduled to run from June 20 to 25 at the Pins Maritimes Expo Palace, and participate in the Vietnam International Sourcing 2023 due to take place from September 13 to 15 in Ho Chi Minh City.

According to the General Department of Vietnam Customs, Vietnam-Algeria trade exchanges edged up 80% in the first five months of this year to reach about US$116 million compared to the same period last year.

3,500 major energy consumers in VN must carry out emission inventory

The Central Office of the Vietnam Association for Clean Water and Environment has just cooperated with relevant agencies to launch the campaign ‘Race to net zero – Commercial Opportunities and Responsibilities of Businesses in the Carbon Market’.

Statistics reveal that on average, Vietnam receives a damage of US$10 billion from climate change, equal to 3.2 percent of its national GDP. The total economic expenses for climate-change-related issues can reach $523 billion in 2050.

Notably, the volume of greenhouse gas emissions per capita in Vietnam has quadrupled this century, and is worryingly maintaining this growth speed, which is the fastest in the world.

Chairman Nguyen Linh Ngoc of the Central Office of the Vietnam Association for Clean Water and Environment said that the Government has specific regulations on industries and fields that have to perform emission inventory and reduce emissions, namely energy, transportation, construction, industrial – agricultural – forestry processes, and land use.

It is estimated that about 120,000 businesses nationwide, including 3,500 major energy consumers must carry out emission inventory and develop corresponding measures to turn their emission amount to zero percent by 2050.

Zero export tariff for DAP and NPK to be applicable from July

The Vietnamese Prime Minister has approved that zero export tariff for DAP and NPK will be applicable from July to eliminate difficulties for domestic production and business enterprises.

According to Decree 26/2023/ND-CP just signed by the Prime Minister, starting from July 15, the export tax on DAP and NPK fertilizers will be reduced to zero with the aim to reduce difficulties for domestic production and business enterprises as well as encourage firms to continue investing and innovating technology for reduction of production costs to enhance competition.

In addition, the Decree 26/2023/ND-CP also amended and supplemented export taxes and preferential import tax rates for some items such as crude copper pipes, crude minced coal, and crude corrugated iron based on the principles of higher export tax rates on domestic products that have not been produced or do not meet the requirements.

More enterprises exporting goods to China via Mong Cai border gate

The number of enterprises exporting goods to China via Mong Cai International Border gate in the northeastern province of Quang Ninh increased to 694 in the first half of this year, 70% higher than that of the same period last year.

According to the head of the border gate management board Tran Bich Ngoc, import-export activities via the border gate stay stable with trade turnover from the beginning of this year to June 15 reaching nearly 1.5 billion USD, a year-on-year increase of 8.24%.

Specially, export turnover topped 1 billion USD, and import turnover 460.8 million USD. State budget revenue reached 667.77 billion VND (28.4 million USD), marking a year-on-year increase of 35%.

Ngoc said that as of June 15, the total volume of import and export goods traversing the border gate neared 753,000 tonnes, an increase of 265% over the same period in 2022.

It is estimated that by June 30, it will reach 833,000 tonnes, up 198% over the same period last year.

Particularly, Bac Luan II Bridge Border Gate will see the entries and exits of 21,534 vehicles with nearly 360,000 tonnes, an increase of 147% in goods volume over the same period in 2022. On average, there are 160 vehicles carrying 2,662 tonnes of goods daily.

Crossing Km3+4 Hai Yen will see 22,704 vehicles carrying nearly 372.5 tonnes of import and export goods. On average, 143 vehicles with 2,343 tonnes of goods traverse the crossing daily, an increase of 585% over the same period in 2022.

Vietnam's exports to the Chinese market are mainly fruits, tapioca, frozen seafood, shrimp, crabs, fish, and other dried goods. Imports from China to China are mainly groceries and fabrics.

Margin lending value increases amid rising liquidity

The value of margin lending at securities companies is increasing in the context that the liquidity in the market has shown positive signs.

Liquidity in the last few sessions of May and the beginning of June almost reached the milestone of VNĐ20 trillion a session.

For example, in the trading session on June 8, the proprietary trading sector of securities companies net bought a value of VNĐ438 billion shares, the highest level since the end of December 2022. Previously, this group net bought more than VNĐ788 billion in May only and disbursed a total of VNĐ2.5 trillion in the first 5 months of 2023.

Large cash flow into the market also comes from a group of domestic individual investors. In a recent report, PYN Elite Fund - an investment fund from Finland - said that individual customers started transferring money from banks to the stock market.

According to statistics on more than 70 securities companies, total margin loans at securities companies increased by 2.4 per cent in the first quarter of 2023. However, compared to last year - when the VN-Index conquered the 1,500 point mark and entered the period of deep adjustment, the margin loan balance decreased by approximately 19 per cent.

There are many factors that positively affect liquidity in the stock market in the second half of 2023. Nearly 105,000 new accounts were opened in May, the highest in the last 9 months.

External factors also supported liquidity such as cooling interest rates, and policies to remove difficulties for the corporate bond market and the real estate market.

After the State Bank of Việt Nam lowered the operating interest rate three times, the deposit interest rate has now decreased by 2.5-3 percentage points compared to the beginning of the year.

Despite the contraction in the total trading value of shares, in the past year, there were still a number of securities companies that successfully expanded the value of margin loans.

VPBank Securities (VPBankS) topped the list when lending a margin value of VNĐ3.1 trillion in 2022. After the M&A deal completed at the end of May 2022, this securities company was officially owned by VPBank (99.95 per cent). This new shareholder with abundant financial resources has helped VPBankS' charter capital increase from less than VNĐ270 billion to VNĐ8.92 trillion in April 2022 and VNĐ15 trillion in December 2022.

Many other new names also recorded a significant increase in margin balance during this period such as DNSE Securities JSC with VNĐ1.1 trillion, DSC Securities with VNĐ723 billion, and Kafi Securities with VNĐ576 billion.

According to its plan, VPBankS will spend most of its resources on margin lending. DSC will offer existing shareholders to double its charter capital. DNSE was approved by shareholders to raise capital through an initial public offering (IPO) of 30.6 million shares.

Many programmes to attract new customers and incentives when using margin lending services are being implemented by securities companies. More opportunities can create a "trigger" to push margin capital back to participate in the market. 

Coffee seedling demand surges in Dak Lak
 
The demand for coffee seedlings has been on the rise in the Central Highlands province of Dak Lak amid higher coffee prices.

Hoa Thang Commune in Buon Ma Thuot City, which is the biggest seedling supply centre in the Central Highlands region, is serving more customers.  

Hoa Thang Commune in Buon Ma Thuot City is the biggest seedling supply centre in the Central Highlands region

Y Su Nie travelled more than 20 kilometres to the centre which has more than 500 coffee trees.

He added that he cut down part of the old coffee trees to grow new ones. He was very happy when coffee prices increased to VND60,000 (USD2.55) per kilo.

Mai Thanh Tung travelled around 60 kilometres to Hoa Thang for seedlings. His family owns 1.2 hectares of land to plant coffee.

“Over the past few years, coffee prices have been sold at just VND30-40,000 per kilo, meanwhile, input costs are rising. This has caused losses for farmers. So, many people and households have destroyed or cut down their coffee plantations, affecting the supply," Tung noted.

Dao Thi Hoang Nhi, a representative from Quoc Cuong Ea Kmart Agro-forestry Company, said coffee seedling demand had exceeded their forecasts. The company has run out of seedlings to sell.

Each coffee seedling is sold at VND4-23,000, depending on their variety, Nhi added.

A representative from the Western Highlands Agro-Forestry Scientific and Technical Institute, said farmers in Dak Lak were actively replanting coffee trees. However, it was necessary to select coffee seedlings of clear origin.

Farmers also need to pay attention to the strict regulations of exporters.

Hai Duong Province attracts $210m in FDI, predominantly in new projects

Hai Duong Province has secured nearly US$210 million in foreign direct investment (FDI) since early June, predominantly in new projects.

Twenty-seven new projects were licensed with a total capital of $125.5 million, registering a 4.5-fold increase in the number of projects and a six-fold surge in registered capital compared to the same period in 2022.

Last year, FDI attraction in the province mainly involved additional capital. This year, $55 million was adjusted for 16 projects, while the rest was invested in shares of domestic enterprises by foreign investors.

The processing and manufacturing industry has been the main sector attracting capital. New FDI projects primarily originate from mainland China, Hong Kong, Taiwan, South Korea and Germany.

Hai Duong aims to attract $410 million in FDI in 2023, with realised investment capital reaching $750 million or more. FDI enterprises are projected to generate revenue of approximately $7 billion, contributing over $400 million to the State budget.

As of May 18, the province had a total of 496 FDI projects with a capital of over $9.2 billion from 26 countries and territories. It ranks fourth in the Red River Delta region and 11th nationwide.

The processing and manufacturing industry accounts for the majority of investments, with 437 projects and a total capital of $8.7 billion. Investors in the area primarily come from Asian countries, comprising 90 per cent of the total, with Hong Kong (China) being the largest investor, accounting for 40 per cent of total registered capital, followed by Japan at 16.3 per cent and South Korea at 15.4 per cent.

However, there are still limitations to the province's FDI attraction. The province has a significant number of small- and medium-sized FDI projects but lacks large-scale investments. Some enterprises have reported long-term losses. There are also issues with workers' wages and social insurance debts.

To foster favourable conditions for FDI enterprises doing business in the locality, the province’s authorities organise annual meetings between provincial leaders and FDI enterprises. This enables timely measures to address challenges and support better and more efficient operations for foreign companies. 

Viet Nam to build ‘integrated payment ecosystem’ to promote cashless payments

With emerging technologies such as AI and blockchain, Viet Nam has the ability to leverage data connectivity to create ‘an integrated payment ecosystem’ to promote cashless payments, experts said at a meeting last Friday in HCM City.

Speaking at a seminar held as part of Cashless Day 2023, Pham Tien Dung, deputy governor of the State Bank of Vietnam (SBV), said: “Data connectivity is the key to unlocking the full potential of cashless payments.”

“By sharing data and collaborating across the ecosystem, we can create a more convenient and secure payment experience for customers, while also driving financial inclusion and economic growth,” he said.

The SBV aims to invest in infrastructure and foster innovation to create an ‘inclusive payment ecosystem that is accessible, convenient, and secure for all,’ he said.

Pham Anh Tuan, director of the SBV’s Payment Department, said: “We have set a goal of making cashless payments account for half of all transactions by 2025.

“We will prioritise the establishment of a more comprehensive, accessible, and secure payment infrastructure across the country to make digital payment a preferred mode of transactions for all,” he added.

With an already strongly developed payment infrastructure, Viet Nam sees average payments of US$40 billion per day, according to Tuan.

The central bank is drafting a new decree to create a legal framework to promote non-cash payments.

He stressed the important role of emerging technologies such as artificial intelligence (AI) and blockchain in improving data connectivity and enhancing the customer experience.

These technologies also help automate payment processes, reducing fraud and errors, and ‘personalise the payment experience and offer targeted benefits and incentives to consumers,’ he noted.

Phan Van Mai, chairman of the People’s Committee, speaking at the seminar, said: “Digital payment is not just an option but a necessity for the future.”

Mai proposed specific regulations to accelerate cashless payments, such as transactions above VND10 million requiring payment via banks, to boost cashless payments.

City agencies such as healthcare, education, insurance, and transportation had conducted cashless transactions, he said.

The city had issued a data strategy, including incentives to encourage cashless payments.

It would continue to work with business associations and industries to promote cashless payments through widespread publicity, he added.

According to an SBV report, more than 75 per cent of adults across the country currently have a bank account.

Interbank electronic payment transactions increased by 52.8 per cent year-on-year in terms of volume in the first four months, it said.

Payment via QR code had the most impressive growth with an increase of more than 161 per cent in quantity and 36.6 per cent in value.

Cash withdrawals at ATMs continued to decline, falling by 3.5 per cent in quantity and 5.5 per cent in value.

The seminar was organised as part of Cashless Day 2023, attracting over 200 participants, including business owners, government officials, and representatives from the banking and fintech industries.

In addition, the Cashless Town Festival was organised from June 16-18 as part of Cashless Day 2023, attracting a diverse collection of merchants, consumers and tech enthusiasts.

It offered various promotion programmes for shoppers and showcased a wide range of cashless payment solutions, including mobile wallets and QR code payments. 

Measures sought to facilitate businesses’ access to credit

A conference discussing solutions to facilitate businesses' access to credit and promote capital absorption of the economy took place on June 19 in Hanoi.

Chaired by Deputy Prime Minister Le Minh Khai, the event saw the participation of representatives from the State Bank of Vietnam, ministries, sectors, 10 commercial banks, and five trade associations.

Khai said thanks to the resolute guidance of the Government and the Prime Minister, the macroeconomy has been kept stable, inflation controlled, major economic balances maintained, and fiscal and monetary policies stabilised by a series of measures.

More measures should be taken to help businesses access capital, thus promoting growth and completing socio-economic development goals in 2023, as well as in the 2021 – 2025 period, he said.

The official touched upon elements affecting access and absorption of capital, which are related to policies; loan and investment plans of businesses; financial, business, and production situation of enterprises; and interest rates.

He underlined the role by commercial banks which directly interact with businesses and borrowers, saying that commercial banks should also pay attention to creating favourable conditions for businesses to access capital.

Deputy Governor of the central bank Dao Minh Tu emphasised efforts by the bank in operating monetary policy in the first five months of 2023, noting that it has combined both theory and practicality in its operation to support the economy and businesses.

He also highlighted specific measures to facilitate businesses and individuals' access to credit, saying the bank has required credit organisations to make it easier for investors of real estate projects, and homebuyers to access credit when they meet all requirements; and focus on allocating funds to real estate projects that meet legal requirements, and those having the capability to repay loans on schedule.

Credit organisations have been also ordered to consider providing credit for investors, construction contractors, homebuyers, and suppliers of construction materials in order to increase capital circulation and liquidity in the real estate market, the official added.

The bank has implemented policies to reschedule repayment terms, while promoting programmes to connect banks and businesses, and taking measures to help small- and medium-sized enterprises and cooperatives access credit programmes, and to address difficulties facing the agricultural sector.

Vietnam to build ‘integrated payment ecosystem’ to promote cashless payments

With emerging technologies such as AI and blockchain, Vietnam has the ability to leverage data connectivity to create ‘an integrated payment ecosystem’ to promote cashless payments, experts said at a meeting last Friday in HCM City.

Speaking at a seminar held as part of Cashless Day 2023, Pham Tien Dung, deputy governor of the State Bank of Vietnam (SBV), said: “Data connectivity is the key to unlocking the full potential of cashless payments.”

“By sharing data and collaborating across the ecosystem, we can create a more convenient and secure payment experience for customers, while also driving financial inclusion and economic growth,” he said.

The SBV aims to invest in infrastructure and foster innovation to create an ‘inclusive payment ecosystem that is accessible, convenient, and secure for all,’ he said.

Pham Anh Tuan, director of the SBV’s Payment Department, said: “We have set a goal of making cashless payments account for half of all transactions by 2025.

“We will prioritise the establishment of a more comprehensive, accessible, and secure payment infrastructure across the country to make digital payment a preferred mode of transactions for all,” he added. 

With an already strongly developed payment infrastructure, Vietnam sees average payments of 40 billion USD per day, according to Tuan.

The central bank is drafting a new decree to create a legal framework to promote non-cash payments.

He stressed the important role of emerging technologies such as artificial intelligence (AI) and blockchain in improving data connectivity and enhancing the customer experience.

These technologies also help automate payment processes, reducing fraud and errors, and ‘personalise the payment experience and offer targeted benefits and incentives to consumers,’ he noted.

Phan Van Mai, chairman of the People’s Committee, speaking at the seminar, said: “Digital payment is not just an option but a necessity for the future.”

Mai proposed specific regulations to accelerate cashless payments, such as transactions above 10 million VND requiring payment via banks, to boost cashless payments. 

The city’s agencies such as healthcare, education, insurance, and transportation had conducted cashless transactions, he said.

The city had issued a data strategy, including incentives to encourage cashless payments.

It would continue to work with business associations and industries to promote cashless payments through widespread publicity, he added.

According to an SBV report, more than 75% of adults across the country currently have a bank account.

Interbank electronic payment transactions increased by 52.8% year-on-year in terms of volume in the first four months, it said.

Payment via QR code had the most impressive growth with an increase of more than 161% in quantity and 36.6% in value.

Cash withdrawals at ATMs continued to decline, falling by 3.5% in quantity and 5.5% in value.

The seminar was organised as part of Cashless Day 2023, attracting over 200 participants, including business owners, government officials, and representatives from the banking and fintech industries. 

In addition, the Cashless Town Festival was organised from June 16-18 as part of Cashless Day 2023, attracting a diverse collection of merchants, consumers and tech enthusiasts.

It offered various promotion programmes for shoppers and showcased a wide range of cashless payment solutions, including mobile wallets and QR code payments.

'Going green' choice that could determine survival

Green transition is no longer a nice-to-have but a must-have for paper companies, which have been struggling to stay afloat amid weakening global demand.

Dang Van Son, secretary-general of the Vietnam Pulp and Paper Association, said 2023 would be a tough year for paper companies as slumping orders had caused a severe supply-demand imbalance in the market.

He estimated paper production at eight million tonnes per year, which was in excess of consumption (six million tonnes per year). The situation could be worse in the short term as the sector was forecast to produce three million more tonnes per year by 2025 due to overcapacity.

"The fall of 12 per cent in exports in the early months of this year has sapped the consumption of paper packaging, which accounts for 85 per cent of the aggregate paper consumption," Son said.

Luong Van Thanh, chairman of Donghai JSC in the southern Ben Tre Province, said orders for paper-based cardboard fell by 15 per cent in the early months of 2023 as fruit exporters, which use cardboard for packaging, had been hit hard by the slump in demand.

"Paper prices fell from VND12,000 (US$0.5) to VND8,000 per kilo. I reckon that the situation would remain tough for the rest of this year," Thanh said.

And the situation was not better for Dai Thanh Production and Development Trading Co. Ltd., which saw orders drop by 30 per cent in the same period. Remarkably, its paper tissues were undergoing a substantial drop in consumption.

"We sold around 100 tonnes of tissues per month in the past. Now, the figure has plummeted to around 30 tonnes," said the company's director.

Secretary-General Son believed that 'going green' could be a real lifesaver for paper companies under the current situation because customers have become more environmentally conscious than ever.

"Customers are shifting their buying patterns in favour of green producers. Those that fail to follow the trend would end up being out of favour," Son said.

Scores of paper companies are aware of green consumerism and they have sprung into action to turn the changing consumer behavior to their advantage.

For instance, Donghai JSC has upgraded its water treatment facilities to improve its water-use efficiency. The green actions have won favour with climate-conscious customers, allowing the company to maintain its customer base amid the economic downturn.

Tetra Pak, another company in the sector, has gone as far as to upgrade their factories to international green standards. The move has enabled the company to gain ground at home and abroad, especially in Australia and New Zealand.

"Green companies have a big advantage over brown ones in the international market. 'Going green' has become a matter of life and death," Son added.

The secretary-general urged paper companies to focus on recycling scrap paper to score more points with environment-conscious customers. He also said paper recycling is highly beneficial to the environment as it reduces the number of trees being cut down for paper and the volume of waste being discharged into the environment.

Paris Air Show 2023 sees VietJet ink deal to equip new fleet with modern seats

Low-cost airline VietJet Air and Safran Seats have signed a contract at the Paris Air Show 2023 to equip its new fleet with modern seats.

Signatories to the deal include Dinh Viet Phuong, chief executive officer (CEO) of VietJet, and his counterpart Victoria Foy at Safran Seats.

Under the terms of the deal, Safran Seats will provide new and modern 24,000 economy class Z200 seats for the firm’s fleet of 120 Boeing 737 MAXs. The first aircraft are scheduled to be delivered to Thai VietJet from mid-2024.

The Z200 is the latest addition of the Safran Seats range used in short and medium haul economy class seats. This new generation of seating is one kilogram lighter than the previous one and will greatly contribute to the airline’s long-term sustainability goal in terms of reducing fuel costs and carbon emissions.

VietJet has chosen options dedicated to passengers’ connectivity needs aboard the aircraft. This seat includes a PED (Portable Electronic Device) holder and USB ports, whilst combining with factors such as comfort, lightness, and durability.

The Paris Air Show has been a major event in the world's aviation industry for more than a century. This year's event took place from June 19 to June 25 at Le Bourget airport, a suburb of the French capital, attracting the participation of more than 2,450 businesses from 49 nations and about 316,400 visitors.

The total value of orders and contracts signed during this event are anticipated to reach US$140 billion.

Tech unicorn VNG to suffer losses for the third year in a row

Tech unicorn VNG Joint Stock Company (VNZ) expect to suffer losses for the third year in a row this year with an estimated after-tax loss of about VND572 billion (US$24.3 million).

Revenue is forecast to reach VND9.3 trillion.

In the first quarter of 2023, VNG reported an after-tax loss of more than VND90 billion. Net revenue reached VND1.85 trillion, up 11 per cent over the same period last year. Thus, by the end of the first quarter, VNG has achieved nearly 20 per cent of its revenue target for 2023.

Most of the reason for VNG's loss in the first quarter of 2023 came from the fact that the company is still under pressure of huge operating expenses with VND544 billion in selling expenses and VND337 billion in administrative expenses. However, by the end of March 2023, the company's undistributed profit after tax was up to VND5.05 trillion.

In the future, VNG will continue to develop business lines in the direction of diversifying products and services and expanding markets. In addition to continuing to invest in key products and services such as video games, advertising, media services, data centres and cloud computing, and e-wallets, VNG will also increase investment into products using artificial intelligence (AI) and other new technologies.

According to a published document, VNG said that due to the need to invest in strategic business areas and diversify products and services, the Board of Directors of the company proposed the General Meeting of Shareholders to approve the retention of cash and conduct no dividend payment for 2022.

Previously, in 2022, VNG recorded revenue of about VND7.8 trillion, an after-tax loss of about VND1.31 trillion.

In May, the Ha Noi Stock Exchange (HNX) put VNZ shares into restricted trading since May 25 due to late submission of audited financial statements for 2022, 45 days later than prescribed. VNZ shares is only traded on Fridays. 

Pre-trading margin requirement is a bottleneck for market upgradation

Pre-trading margin requirement is a bottleneck in the process of upgrading the Vietnamese stock market.

This information was shared by the leaders of the Asian Securities and Financial Markets Association (ASIFMA) during a meeting with the delegation of the State Securities Commission (SSC) of Viet Nam within the framework of the 48th annual meeting of the International Organisation of Securities Commissions (IOSCO).

Chairman of the State Securities Commission Vu Thi Chan Phuong informed the meeting about the development, achieved results and potential and investment opportunities of the macro-economy in general and Viet Nam’s stock market in particular.

She also updated information about practical changes in the Vietnamese stock market recently and discussed with ASIFMA about the green and sustainable development orientation of Viet Nam’s capital market in the future.

Alice Law, general director of ASIFMA, said that the current members of the ASIFMA include institutional investors, securities service providers, market rating agencies, global custodial banks, securities depository and clearing institutions, law firms and securities brokerage firms doing business in Asia. ASIFMA closely follows information and provides a lot of support to its members when participating in regional markets.

ASIFMA’s members were very interested in the Vietnamese stock market, as well as forecasting the high growth potential of service activities and foreign indirect investment in Viet Nam in the near future. In order to unlock and promote this potential, upgrading the stock market from marginal to emerging is a priority for Viet Nam, Alice Law said.

According to Alice Law, ASIFMA members are currently investing and providing securities services in Viet Nam. A number of bottlenecks have been proposed to the State Securities Commission to solve in terms of policy implementation, such as increasing access to information in English for foreign investors; publicise and update foreign investors’ ownership ratio; increasing the number of listed companies; strengthening inspection in the market to ensure transparency in information disclosure; the procedure for opening a trading account; and strengthening dialogue with investors.

However, one bottleneck that foreign depository banks hope for a radical solution is the requirement of pre-transaction margin and securities blockade.

ASIFMA member depository banks believe there should be a separate mechanism for guaranteeing payment for securities transactions or granting short-term credit lines to foreign investors who conduct securities transactions, said Alice Law.

She wishes to act as a bridge between the securities regulator and investment institutions, providing securities services so that they can frankly discuss and recommend solutions to help the Vietnamese stock market be upgraded.

Also at the meeting, the two sides agreed to coordinate with the World Bank to organise a seminar on solutions to upgrade Viet Nam’s stock market in August 2023 in Hong Kong on the occasion that the State Securities Commission is about to visit rating agencies FTSE Russel and MSCI. 

Vietnam-Japan supporting industry exhibition to get underway in August

A press conference was held on June 20 in Hanoi as part of efforts to unveil the 2023 Vietnam-Japan Supporting Industry Exhibition (SIE) and the Vietnam Manufacturing Expo (VME), slated for August 9 to August 11.

The event is expected to attract more than 200 manufacturers and distributors from 20 countries globally, with the aim of boosting trade exchanges among businesses operating in the supporting industry and accelerating the development of the manufacturing industry in Vietnam.

Upon addressing the event, Takeo Nakajima, chief representative of Japan External Trade Organization (JETRO), emphazised that two-way trade between Vietnam and Japan has nearly doubled in the 2013 to 2022 period.

Japan’s direct investment into the Vietnamese market last year increased by 12% to reach US$4,559 million compared to the previous year, he added.

According to a survey carried out by JETRO, the percentage of Japanese companies purchasing raw materials, components, and spare parts in Vietnam increased from 28% in 2012 to 37% in 2022. 

Although the proportion has risen significant, it remains slow in comparison to the economic development of the two countries.

Vu Ba Phu, director of the Vietnam Trade Promotion Agency, pointed out that there are roughly 2,000 enterprises producing spare parts and components in Vietnam, of which only 300 firms have participated in the multinational supply chain, thereby generating jobs for more than 600,000 workers.

At present, the number of enterprises operating in the field of supporting industries accounts for nearly 4.5% of the total number of enterprises in the processing and manufacturing industry.

Phu stressed that the function will assist Vietnamese enterprises in the supporting industry as they enhance production capacity and connect with Japanese partners.

Petrol prices forecast to experience slight fluctuations in next adjustment: VPI

The Vietnam Petroleum Institute (VPI) has forecast that domestic petrol prices may see slight fluctuations in the adjustment on June 21.

According to the VPI’s prediction, which was given with the support of the petrol price forecasting model using Machine Learning, the retail price of RON95 may increase 197 VND per litre to 22,110 VND (0.94 USD) per litre, while the price of E5 biofuel is forecast to rise by 5 VND per litre or remain unchanged at 20,870 VND per litre.

Meanwhile, the price of diesel is predicted to rise to 18,189 VND per litre, and that of kerosene may be pushed up by 205 VND per litre to 18,025 VND per litre.

Meanwhile, the price of mazut is predicted to fall by 27 VND per litre to 14,683 VND per kilo. The VPI also predicted that management agencies may extract about 300 VND from each litre of petrol products for the fund for petrol price stabilisation.

In the world market, on June 19 morning, the price of Brent oil fell by 68 cents to 75.93 USD per barrel, while the WTI oil price fell by 59 cents to be traded at 71.19 USD per barrel. Global crude oil prices dropped due to concerns about a slow recovery of the Chinese economy despite the impact of OPEC production cuts from last week and a decrease in the number of oil and gas rigs operating in the US.

The International Energy Agency (IEA) has revised up its forecast for global oil demand in 2023 by 2.4 million barrel per day to a record high of 102.3 million barrel per day. However, the IEA forecast that global oil demand will decline by 860,000 barrel per day in 2024 due to unfavourable economic growth prediction. Global oil supply is forecast to increase slightly at 101.3 million barrel per day in 2023 and 102.3 million barrel per day in 2024.

Wood Mackenzie revised down its 2023 average Brent oil price forecast from 84.7 VND per barrel to 84.3 USD per barrel. Goldman Sachs also forecast that the oil price at the end of 2023 will decrease by nearly 10%, of which the average Brent oil price will reach 86 USD each barrel and the average WTI oil price will reach 81 USD per barrel in December 2023.

At the same time, JPMorgan also lowered its oil price forecast for 2023 with Brent falling from 90 USD per barrel to 81 USD per barrel, and WTI dropping from 84 USD per barrel to 76 USD per barrel. In 2024, JPMorgan reduced its forecast for Brent oil price from 98 USD per barrel to 83 USD per barrel and WTI oil price from 94 USD per barrel to 79 USD per barrel.

VPI experts held that in the next few weeks, the petrol prices will continuously fluctuate when inflation data and interest rate adjustments are announced.

In case the US Federal Reserve (FED) decides to keep interest rates unchanged and the US Department of Energy continues to look for opportunities to buy additional oil for the Strategic Petroleum Reserve, the decline trend in oil prices may be reversed. Accordingly, VPI experts forecast that Brent oil price in 2023 will be traded at an average price of 82 USD per barrel.

Korean expert upbeat about RoK-Vietnam economic cooperation

President of the Korea Trade-Investment Promotion Agency (KOTRA) Yu Jeong Yeol had an article published on the Economic Daily on June 19, which described Vietnam as a crucial economic partner that the Republic of Korea (RoK) must definitely cooperate with. 
 
The article highlighted the prominent features of Vietnam, such as a young population with half being under 35 years old. Since the late 1980s, Vietnam has achieved high economic growth, averaging around 6% a year thanks to the success of its foreign policy, active integration and openness. Vietnam is attracting attention as a high-potential market based on its advantages in an abundant and young workforce as well as continuous expansion of infrastructure by the Government. This is why leading countries and multinational corporations continue to bet on Vietnam's growth potential, the article said.

The article also mentioned achievements in two-way trade, which had reached an all-time high of 87.7 billion USD on the occasion of the 30th anniversary of RoK-Vietnam diplomatic relations, turning Vietnam into the third largest trade partner of the RoK. Approximately 8,800 Korean companies have been investing in Vietnam, contributing to trade and economic and industrial ecosystem as well.

According to the article, it can be affirmed that the upcoming Vietnam visit by RoK President Yoon Suk Yeol is a significant opportunity, and all parties should consider orientations of bilateral economic cooperation and strategies for Korean companies to penetrate the Vietnamese market.

The author suggested upgrading the trade structure with Vietnam and strengthening partnerships in the supply chain. The RoK and Vietnam are expanding complementary trade, focusing on intermediate goods and components.
  
Involvement in projects related to energy and environmental sustainability should also be acknowledged. Vietnam is the first country with which the RoK has signed an agreement on climate change. Furthermore, as government-led projects involving the development of smart cities and smart farms are activated, bilateral cooperation opportunities are expected to expand. 
  
In the field of digital transformation, the article said the demand for cooperation in information and communication technology (ICT) is also growing. Vietnam aims to make a leap forward in future industries such as health care, educational technology, and big data through innovative technologies like 5G and artificial intelligence (AI). Korean small and medium-sized enterprises and startups have recognised these needs and actively entered the Vietnamese market.

In conclusion, the article said the global economy in the post-pandemic era is rapidly changing, and countries around the world are facing numerous challenges. In this transitional phase, the RoK and Vietnam need to strengthen their relationship as strategic and comprehensive partners, while also developing a stronger economic bond.

It is hoped that the State visit to Vietnam by the RoK President will present an opportunity for companies and corporations from both countries to explore future cooperation areas and pave the way for new engines of economic growth, the article said.

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