A Ho Chi Minh City programme to link banks and businesses has seen around 93 trillion VND (3.97 billion USD) disbursed so far this year to help revive the economy which was battered for two years by the COVID-19 pandemic.

Analysts say credit growth has risen sharply, indicating the efforts made by credit institutions to supply the economy with capital, and some banks have reported using up their full-year quota in just four to five months.

Amid the rapid economic recovery, many businesses say they need more funds to supplement their working capital and expand. For small and medium-sized enterprises, banks remain the main source of capital, and it does not help their cause when lenders run out of credit room.

With more than 95% of the country’s enterprises being small or medium sized, this is a widespread difficulty.

It introduced a 350 trillion VND recovery programme and 2 percent interest rate subsidy worth 40 trillion VND, he said, adding it should accelerate these programmes and even consider further support to businesses.

In May, the Government announced it will subsidise interest on credit for companies, co-operatives and business households.

Besides, it has reduced corporate income tax, VAT and personal income tax and waived fines for late payment of taxes by businesses facing difficulties.

The support package is worth a total of 21.3 trillion VND. These measures could not help businesses recover immediately, but would provide great support, experts said.

Banking shares plummet to attractive prices

The banking industry may have a hard time reaching its 2022 profit growth targets, but share valuations have dropped significantly to attractive prices.

In the past three months, banking shares witnessed sharp declines and were among the most negatively impacted on the stock market. Most banking stocks decreased by over 30% and there was no single bank seeing positive growth.

The decline was attributed to stricter control of credit flows, increasing bad debts mainly caused by real estate businesses, corporate bond inspection at banks and inflationary pressure which have affected investor sentiment.

However, after a series of deep declines, many banking stocks are rebounding strongly in recent sessions. This brings hope to many investors in this industry group.

In a newly released report, FiinGroup said that the total operating income of 27 listed banks in the first quarter of 2022 increased by 8.2% compared to the previous quarter. Compared to the same period last year, total operating income increased by 22.2% and only three banks recorded a decline, the others grew positively.

Net income from services decreased by 12.1% compared to the previous quarter after increasing sharply in Q4 of 2021, but still up by 14% compared to Q1 of 2021. The high quarter-on-quarter growth of the remaining activities came from other activities ( 83.3%), foreign exchange ( 21.7%), while income from securities dropped sharply (-52.7%).

Profit after tax of 27 listed banks increased by 51% compared to the previous quarter and up by 31% compared to the same period in 2021.

Hanoi applies IT to enhance value of agricultural products

Despite production and market difficulties due to the pandemic and climate change, many districts, firms and organisations in Hanoi's agricultural sector have remained strong thanks to the application of science and information technology.

It has helped them improve their products’ value and meet the technical requirements of import markets.

In the past few years, Hanoi’s agriculture sector has implemented many programmes and solutions to support businesses and cooperatives to promote the application of information technology in the production and processing of agricultural products, which have brought many benefits, such as increasing the product value, food safety management and product information transparency.

Tran Sy Hung, Director of Nghia Minh Mushroom cooperative in Dan Phuong district, said his cooperative had applied information technology in production, processing and packaging besides registering QR codes on products’ stamps and packages so that consumers can check all production stages.

On average, the cooperative provides 30-40 tonnes of mushrooms of all kinds annually, which helps its members earn 500-600 million VND (21,500-25,800 USD) a year.

Doan Van Thang, Director of Van Nam agricultural cooperative in Phuc Tho district, said with the support of competent authorities, his cooperative's products had traceability stamps and a collective brand logo named Van Nam Banana so consumers can recognise and be assured of the product quality.

Pham Thi Ly, Director of the Centre for Enterprise Integration and Development in Thanh Xuan district, said the centre had cooperated with Hanoi's agriculture sector to support cooperatives and enterprises in applying Check VN technology to establish data, digitise, monitor, control, secure and authenticate information on products that are eligible for food hygiene and safety.

The centre had also rapidly helped connect manufacturers and managers with consumers through QR codes and Check VN application software.

Cashless payments still booming after pandemic

The COVID-19 pandemic has been brought under control, and life for most people returned to normal. However, non-cash payments, encouraged during the pandemic to limit contact, have become popular among many people.

The pandemic accelerated this payment form towards a cashless society as oriented by the Government and the State Bank of Vietnam (SBV).

According to a survey recently conducted by digital payment giant VISA, 65% of Vietnamese are carrying less cash in their wallets and one-third say they will stop using cash after the pandemic. Almost 76% of the consumers now use mobile wallets and even more (82%) use cards.

VISA also pointed out that online shopping and cash alternatives are all likely to stay on after the pandemic. Two-thirds of Vietnamese tried shopping online during the pandemic and half of them made their first purchase through social networks. Nine out of 10 consumers are now using home delivery services, and almost all of them now use it more often than before the pandemic.

An overwhelming majority (more than 80%) now use their cards, QR payments, and mobile wallets at least once a week. Meanwhile, a solid half of all Vietnamese have begun using cards more often, while 64% and 63% have increased their use of mobile contactless and mobile wallet payments, respectively.

Electronic documentation system fundamental to digital economy

Enterprises are gradually switching to an electronic documentation system, underpinning the nation’s efforts to develop the digital economy.

A survey conducted by the Ministry of Industry and Trade in 2021 revealed that at least 33% of the surveyed businesses use e-contracts in their commercial activities.

The application not only helps firms and their customers be more efficient, but also contributes to reducing the impact of the COVID-19 pandemic and the gap in commercial transactions.

The Bkav DX Platform has hosted e-contracts for more than 3 years. As a result, it helped companies save 70% of printing and delivery costs annually and shortened the process of providing products to customers by 50%.

A representative of FPT Information System Company said that in Vietnam, the concept of e-contracts is no longer new. On the FPT.eContract – a signing platform between businesses and individuals – there are more than 2,000 customers performing transactions of data and contracts.

Deputy Minister of Industry and Trade Nguyen Sinh Nhat Tan said Vietnamese businesses have long signed e-contracts with foreign partners in cross-border transactions and import-export activities.

On September 25, 2021, the Government issued Decree 85, detailing e-contract authentication services known as the CeCA-Certified eContract Authority to develop a legal framework for organisations who provide e-contract certification services.

Seafood export takes larger bite out of foreign markets

Seafood shipments overseas have risen in the first half of 2022, and experts say Tra fish exports can increase the market share in the EU, while that of shrimp has a lot of room for growth in Canada.

According to the Vietnam Association of Seafood Exporters and Producers (VASEP), as of May, the value of frozen Tra fish exports to the EU this year reached 76.8 million USD, up 95% year-on-year. This means the market has bounced back after a two-year downturn due to the COVID-19 pandemic. The Netherlands remains the biggest market in the EU for the Vietnamese products, while positive signals are coming from the shipment of frozen Tra fish to Germany, Spain, and Belgium.

In addition to the bloc, Vietnamese Tra fish exporters have also stepped up their activities in Mexico, Egypt and Thailand.

As of mid-May, Vietnam exports shipped to Mexico are at 45.6 million USD, up 70% year-on-year.

VASEP said the Mexican market accounted for the largest proportion of the value, at 35%, of Vietnamese Tra fish exported to member countries of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).

Thailand, meanwhile, is a new partner of Vietnam in the sector over recent years, with 60 Vietnamese firms now actively shipping exports to the market.

However, insiders said that the market is good, but raw fish for processing is still in short supply, and the situation is projected to continue until the end of the third quarter.

Regarding shrimp exports, whose value grew 38% annually to hit about 1.8 billion USD as of mid-May, experts have predicted extensive increases from the Canadian market in the time to come.

During the period, Vietnam reeled in 100 million USD from shrimp shipments to Canada, up 87% against last year.

After the CPTPP took effect in 2019, such exports raked in 187 million USD in 2020 and 180 million USD in 2021. Currently, there are about 80 shrimp exporters to the market with a wide variety of products.

Vietnamese, RoK firms advised to team up for post-pandemic recovery

Vietnam and the Republic of Korea (RoK) need to beef up cooperation and investment in the post-COVID-19-pandemic period, said Joo Si-bo, president of the RoK-Vietnam economic cooperation association, at a conference in Seoul on June 24.

During the discussions, representatives of Vietnamese and RoK businesses exchanged presentations on topics such as the nations’ economic cooperation in the post-COVID-19 era, investment opportunities in Vietnam, and infrastructure development and innovation in Vietnam.

Participating speakers expressed their confidence in the potential and positive economic growth dynamics of Vietnam after the pandemic.

They also pointed out that given the 4th Industrial Revolution and the digital economy, Korean enterprises will gradually increase the proportion of innovative technologies and reduce the rate of intensive labour use.

They recommended the sides team up to build supply chains and develop environmentally friendly technologies.

Vietnam, Belgium seek stronger partnership in renewable energy, port development

A workshop themed “Vietnam as your Green business opportunities destination” was held by the Belgian Vietnamese Alliance (BVA) and the Flanders International Technical Agency (FITA) in Brussels on June 22 to introduce Vietnam’s potential in renewable energy and sustainable port development.

Participants at the workshop held that in order to reach the net-zero emission target, Vietnam should increase the capacity of generating renewable energy, especially solar and wind power.

Chairman of the International Port Engineering & Investments Ltd (IPEI) Marc Stordiau said that the firm is working with Vietnamese partner to strengthen investment in green energy by supporting Vietnam to build wind power stations in Vietnam’s south-central Binh Thuan province.

IPEI is also piloting a model of "Water by Wind" (WbW) in Ninh Thuan province for the 2020-2022 period, he said, adding that the objective of the project is to seek solutions to supply fresh water serving agricultural production and the daily life of populations in areas with difficult natural conditions, including those in south-central coastal and Mekong Delta region through a water desalination system using wind and solar energy.

Kim Demeyer, a FITA scientific and technical advisor, held that Vietnam is an attractive destination for foreign energy investors. In particular, the EU-Vietnam Free Trade Agreement (EVFTA) has created favourable conditions for European investors in investing in the country.

As a coordinator connecting Belgian companies and Vietnamese firms, Eve Devoldere, a trade and investment counselor of FITA Office in Vietnam, highly valued the investment and business environment in Vietnam, particularly in the field of green energy.

Closing of the seminar, Belgian Senator Andries Gryffroy, who is also BVA President, lauded experiences and suggestions shared by the speakers. He said that the European Chamber of Commerce in Vietnam (EuroCham) will organise the Green Economy Expo and Forum (GEFE) 2022 from November 28-30 in Ho Chi Minh City, giving an opportunity for European agencies and companies, including those from Belgium, to provide Vietnam with sustainable solutions to support a green and sustainable Vietnamese economy.

Korean airline restarts direct flights to Khanh Hoa

Air Seoul, a low-cost Korean carrier and a subsidiary of Asiana Airlines, reopened its direct air route from Incheon to Cam Ranh City in the central coastal province of Khanh Hoa on June 24.

187 passengers onboard flight RS525, which departed from Incheon International Airport were welcomed by local authorities immediately upon arrival at Cam Ranh International Airport.

According to Le Thi Hong Minh, general director of Cam Ranh International Terminal Joint Stock Company (CRTC), this represents the second Korean airline to re-operate the Republic of Korea (RoK)- Cam Ranh route. This clear shows signs of recovery for the tourism market for Korean travelers to the province.

Lee Jungmi, chief representative of Air Seoul in Khanh Hoa province, said that after the flight the airline will operate four flights a week to Cam Ranh running on Monday, Thursday, Friday, and Sunday.

The RoK carrier plans to launch regular flights to the Vietnamese province ahead in late July with a frequency of four flights per week and one flight per day in late August.

Tiền Giang develops specialised dragon fruit growing areas for export

The Mekong Delta province of Tiền Giang has zoned nearly 9,400ha of dragon fruit growing areas exclusively for exports and targets annual output of 236,000 tonnes of the fruit.

They are mainly in Chợ Gạo, Tân Phước, Gò Công Tây, and Gò Công Đông districts, with the last-mentioned accounting for nearly 7,500ha.

Chợ Gạo dragon fruit has been granted a collective brand name by the National Office of Intellectual Property.

Tiền Giang, the country’s largest fruit producer, has identified dragon fruit as one of its speciality fruits for its competitive advantages and high export value.

It has taken a number of measures to improve the competitiveness of speciality fruits and ensure they have steady outlets.

These have helped sustainably develop specialised dragon fruit growing areas, renovate agriculture production and foster rural development.

The department has organised forums to teach farmers intensive farming techniques under the project.

The techniques include growing the fruit on trellises, making and using organic fertilisers, installing automatic spraying systems, and pruning branches.

Farmers have also been instructed in integrated pest management, to grow the fruit to good agriculture practices (GAP) standards and develop co-operatives.    

The province pays close attention to producing quality seedlings for cultivation.

The Southern Fruit Research Institute in its Châu Thành District has created several new dragon fruit varieties that have become popular in both the domestic and export markets.

All dragon fruit growing areas are lit at night with compact electric bulbs to induce flowering, some 73 per cent of lands are equipped with drip irrigation facilities and 500ha have trellises to improve yields and quality.

More than 2,196ha conform to VietGAP standards and 110ha to GlobalGAP standards.

The province exports 80 per cent of its dragon fruit output to China, the US, the EU, Japan, and South Korea, and overall exports are worth US$100 million a year.

Mothers and babies sector booming in VN
     
The retail market of products for mothers and babies is booming as interest in health is increasing, especially for vulnerable groups such as families with infants and children.

The trend to go to specialised supermarkets for mothers and babies has become popular in large centres such as Ha Noi and HCM City and has spread to many cities across the country.

Increasingly, modern life makes the demand for shopping in the mothers and babies sector rise.

It is not difficult to find baby supermarkets anywhere, such as Con Cung, Bibomart, Kids Plaza, Shop Tre Tho, Tuti care and more.

Even nursing mothers do not need to go out but can order products of authorised brands in the market on reputable online sales sites such as Shopee, Tiki, and Lazada so as not to waste time travelling.

The attractiveness of the new shopping trend for breastfeeding mothers, along with the large market size, up to billions of U.S. dollars, has lured many large domestic and foreign corporations to pour money into the field.

Early this year, international newspapers reported that Quadria Capital, headquartered in Indonesia, completed an investment of $90 million in Con Cung to help the mother and baby retail chain open 2,000 more stores by 2025.

Before Quadria Capital, two organisations related to SSI Securities, SSI Asset Management Co., Ltd. (SSIAM) and DAIWA-SSIAM Viet Nam Growth Fund II L.P., also invested in the Con Cung chain.

SSI Securities also supported Con Cung Investment Corporation, which owns the Con Cung chain, to mobilise bonds for expansion.

In addition, many large domestic organisations also target this potential and very large-scale business. Mobile World Investment Corporation (MWG) had its first experiments with the retail chain of goods for mothers and babies, AVA Kids, at the end of last year. They opened 20 stores by the end of April this year.

MWG was estimated to have 50 stores last month and is expected to continue to grow this year and in the following years.

It is estimated that the brand's mother and the baby chain has reached more than 1,000 stores in Viet Nam.

MWG expressed its ambition to be at the top of the market for mother and baby products, with the number of stores reaching 1,000 or more, with revenue contributing VND1-1.5 billion per store, equivalent to VND1-1.5 trillion in total revenue.

The attraction of the Vietnamese mother and baby market is huge. According to Quadria Capital, the growth rate of this field is up to 30-40 per cent per year.

Over the past four years, Con Cung has grown exponentially at a compound annual growth rate of 70 per cent.

The middle class in Viet Nam is on the rise. According to World Data Lab, it is expected that the Vietnamese class will have more than 23 million by 2030.

This is the driving force in promoting consumption, including the mother and baby industry.

In an announcement early this year, Quadria Capital said that this group would support the chain to develop an "all-in-one" super app that provides personalised products and services for about 5 million Vietnamese mothers.

The number of Con Cung stores at that time was 600. It was 658 as of June 8.

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