Vietnamese small- and medium-sized enterprises (SMEs) should better their management capacity and business strategies so as to draw capital from both domestic and foreign investment funds who are holding hundreds of billions of USD, economists have said.

The funds are able to provide SMEs with effective financial solutions, they said, elaborating instead of investing in financial tools, they are targeting unlisted companies and listed ones who are planning to withdraw their stocks from the market to engage in the firms’ management and business growth. The funds commit at least five- to ten-year investment, experts said.

Last month, the Vietnam Chamber of Commerce and Industry received a delegation of 14 world and region’s leading multi-national investment funds who came to seek investment opportunities.

Along with large funds such as VinaCapital and Mekong Capital, there is an increasing number of foreign venture capital funds expressing interest in the Vietnamese market.

However, most of the Vietnamese firms have not been well aware of the funds while their poor management and foreign language proficiency as well as limited understanding of the financial market’s potential are hindering them in seeking investment, said Tran Thanh Hai, a specialist from Bac A Commercial Joint Stock Bank.

Besides, the SMEs need to prove their capacity, technology and business vision, according to Hai. Once getting long-term capital from investment funds, they will have motive to invest in long-term values like digitalisation in management and business and automation in production./.

Insurance staff forbidden to entice customers: minister

Insurance staff are strictly prohibited by law to provide misleading advice, engage in excessive competition, entice customers or take advantage of individuals with limited knowledge for the purpose of selling insurance, said Minister of Finance Hồ Đức Phớc.

At the ongoing 31st meeting of the National Assembly Standing Committee on Monday morning, deputy Trần Đình Gia from Hà Tĩnh Province expressed his worry over the market's distortion as insurance consultants excessively chase after customers to sign contracts.

This has caused misunderstandings for customers and ultimately affected the quality of insurance services, Gia said adding that the insurance contract's term is often very long while specialised terms force insurance buyers to depend on consultants.

Meanwhile, insurance sellers often only advise the good aspects without clearly stating the rights and responsibilities, leading to the situation that buyers are not sure of the content of the policy and often find themselves at a disadvantage when disputes arise.

Deputy Nguyễn Anh Trí from Hà Nội shared the concern and proposed that the Minister of Finance provide insights into new provisions in the draft Decree amending Government Decree 40 (2018) and Government Decree 80 (2019) on sanctioning administrative violations in the field of insurance business.

Responding to the concerns about the insurance market, Minister Phớc said that the manipulative acts in insurance sales are the acts of insurance staff and their companies.

In terms of management, the law prohibits insurance staff from giving false advice, scrambling, enticing and using tactics to take advantage of people with limited knowledge to sell insurance.

The Ministry of Finance has carried out inspections and investigations when receiving complaints, strictly sanctioned and transferred to the investigation agency cases with signs of wrongdoing for handling.

In the past, there were lengthy contracts that consisted of dozens of pages, causing confusion and damage to insurance buyers.

However, in amending the law on insurance business in 2023 and relevant regulations, the drafting body has devoted a whole chapter on insurance contracts aiming to ensure that they are shorter, clearer and stricter.

The law also specifies that within 21 days, if it is found that the insurance contract has errors, the insured has the right to claim the money back, and the insurer must return it to the insured.

Minister Phớc said: "Therefore, issues related to insurance contracts or enticing customers to buy insurance have been clearly stipulated in the law on insurance business in 2023.”

Vietnam to export chicken meat to Islamic countries

The Ministry of Agriculture and Rural Development (MARD) will hold a conference in May to announce the export of chicken meat products to Islamic markets with an estimated volume of around 1,000 tonnes per month, according to Deputy Minister of Agriculture and Rural Development Phung Duc Tien.

The Deputy Minister said the market of Muslim countries with a total population of around 2.2 billion people offers opportunities for a number of Vietnam's agricultural products.

To date, Vietnamese companies have exported many products such as tra fish (pangasius), vegetables, fruits and rice to this market. However, the MARD believes that there is still great potential to be exploited.

According to the official, to export agricultural products to Muslim countries, Vietnamese products must have Halal certification. In the coming times, the ministry will focus on implementing solutions to tap this market./.

Vietnam, US state step up cooperation

The Vietnamese trade office in the US had a working session with Secretary of the Department of Commerce of Maryland state Kevin Anderson on March 18, seeking cooperation opportunities between Vietnam and the US state.

At the event, Anderson said Maryland is interested in cooperation in the areas of trade, agriculture, education, logistics, tourism, and investment in smart phone production.

Maryland, spanning over 32,000 square kilometres in the northeastern part of the US, boasts strength in tourism, retail sales, communications and finance, education, agriculture, energy, and science technology. The state is working towards expanding and signing cooperative agreements with international partners, including those in Southeast Asia.

Currently, it has three free trade zones to attract investment and production.

The Vietnamese trade office proposed a technical study to consider a Memorandum of Understanding (MoU) between the Ministry of Industry and Trade and the Maryland administration based on several MoUs that Vietnam has clinched with West Virginia state and Oregon state and one to be signed with Washington state.

Speaking highly of the recommendation, Anderson said Maryland will have an internal discussion and discuss the issue soon.

The Vietnamese side took the occasion to invite Anderson to the Vietnam International Sourcing Expo that will take place in Ho Chi Minh City in June. The latter said he and Maryland Governor Wes Moore have been interested in enhancing the economic and trade ties with Vietnam, and will arrange time to join the event.

Besides, the office asked for Anderson’s support in pushing for Vietnam’s recognition as a market economy by the US./.

Vietnam ready to back Denmark's APM Terminals to pilot green port projects: Deputy PM

Vietnam is ready to provide favourable conditions for APM Terminals to pilot green port projects along with a mechanism for direct electricity trading from renewable energy projects in Vietnam, said Deputy Prime Minister Tran Hong Ha while hosting the Danish company's CEO Keith Svendsen in Hanoi on March 18. 

Ha said the traditional friendship and the newly-established green strategic partnership between Vietnam and Denmark have created chances for Danish businesses to invest in Vietnam, especially in the fields of green economy, renewable energy and seaport infrastructure.

The Deputy PM said that during the process of planning the seaport system, Vietnam is striving to both ensure the optimality of international trade transport routes and meet the development requirements of industries, especially manufacturing-processing with a scale and model consistent with the green and smart port trend.

Ha highly valued APM Terminals’ plan to develop a green fleet and green seaports amid increasing strict technical barriers and environmental and greenhouse gas emission standards for the sea transport and seaport industry.

For his part, Svendsen hailed the achievements that Vietnam has gained in improving the business environment and creating favourable conditions for foreign investors, as well as Vietnam’s efforts in digital transformation and green transition towards sustainable development.

The commitment to net-zero emissions that Vietnam delivered at the 26th UN Climate Change Conference (COP26) fits APM Terminals’ orientation to develop a green fleet and green seaports in the coming years, he said.

Svendsen underlined that his company hopes to explore investment opportunities to build the largest and modern deep-water container seaports in Vietnam through digital, lean and green initiatives, and expressed a hope to receive support from the Government of Vietnam in the coming time./.

VASEP says zero per cent export services tax should remain

The Vietnam Association of Seafood Exporters and Producers (VASEP) has called on the government to retain the existing zero per cent tax for export services, saying it plays an important role in ensuring fairness and healthy competition in the economy.

VASEP's calling came amid proposed amendments to tax laws, which could potentially see export services subjected to a 10 per cent value-added tax has been put forward.

In letters addressed to key ministries and regulatory bodies including the Ministry of Finance (MoF), Ministry of Justice (MoJ) and the General Department of Taxation, VASEP said subjecting export services to a 10 per cent tax rate deviates from international norms where many countries apply a zero per cent tax rate for such services, coupled with provisions for input tax refunds.

The association said the tax, if approved, will have detrimental impacts on export-oriented enterprises including increases in production costs, which will hurt Vietnamese businesses' ability to compete in the global market. As an economy heavily reliant on exports, it may lead to far-reaching consequences, including reduced export turnover and diminished investor confidence.

Earlier, the Vietnam Chamber of Commerce and Industry (VCCI) also called on the government to maintain the zero per cent tax for export services, over worries that tax hikes would undermine the competitiveness of Vietnamese exporters. 

Vietnam, US strengthen trade relations

Deputy Minister of Industry and Trade Phan Thi Thang had a meeting with Deputy Assistant US Trade Representative (USTR) for Southeast Asia and the Pacific Sarah Elleman, within the framework of Vice State President Vo Thi Anh Xuan’s recent working visit to the US.

The two sides assessed the official upgrade of the Vietnam - US relations to a comprehensive strategic partnership on September 10, 2023, as a historic milestone in bilateral ties, in which economic and trade cooperation will continue to be an important driving force, playing a pioneer role in promoting common prosperity between the two countries.

Therefore, management agencies of the two countries in general and between the Ministry of Industry and Trade of Vietnam and the USTR Office in particular need to have more extensive collaboration activities to implement and realise the vision of high-ranking leaders, and set development goals commensurate with the comprehensive strategic partnership for the coming journey, they said.

Thang spoke highly of the close cooperation between her ministry and the USTR Office over the recent past, especially in increasing the efficiency and intensifying policy exchanges on a variety of economic and trade issues through the dialogue mechanism of the US-Vietnam Council on Trade and Investment.

She reiterated the need for relevant agencies of the US Government to have a substantive voice supporting the early removal of Vietnam from the non-market economy status, affirming that recognising Vietnam as a market economy will allow Vietnamese businesses to be treated more fairly, without affecting the legal rights of the US domestic manufacturing sector.

In addition, the US recognition of Vietnam's efforts in economic reform will motivate other economies, and create more pushes for Vietnam in improving its business and investment environment, thus helping form a stable supply chain for the import and consumption needs of US enterprises and people, stressed Thang.

In the field of trade defence, the official expressed deep concern over the increasing frequency of this kind of investigations on Vietnamese exports, and suggested the US carefully consider Vietnam's opinions in each specific case to ensure trade liberalisation, fairness, objectivity, and transparency for trade activities of the two countries' businesses.

Regarding specific cooperation activities in industry and energy, Thang proposed the two sides promote the implementation of signed agreements, expressing her hope the US and developed countries will have specific funding packages to support Vietnam in effectively implementing energy transition. She also suggested the US help the Southeast Asian nation improve its processing capacity and protect the environment in the process of mastering and exploiting natural resources.

The Vietnamese official also had working meetings with the Presidents of the American Association of Exporters and Importers (AAEI) and the Asian American Chamber of Commerce (AACC).

US associations highly valued the development potential and investment and business opportunities in Vietnam, saying that many member businesses are currently interested in diversifying supply chains and expanding investment in digital trade and services, seaport development, education, and finance in Vietnam.

Thang took the occasion to invite AAEI and AACC to introduce member businesses to attend the Vietnam International Sourcing 2024 scheduled for June in Ho Chi Minh City./.

New drivers for Hải Phòng’s investment attraction

The South Hải Phòng Economic Zone - if established - would create a new driving force for Hải Phòng's economic development, as heard in a conference in the northern port city on Sunday. 

Head of Hải Phòng Economic Zone Management Board Lê Trung Kiên said that the zone's establishment is very necessary in the process of restructuring the economy of Hải Phòng and the whole country. This is demonstrated through the formation and development of Đình Vũ-Cát Hải Economic Zone (EZ).

Established in 2008, the 22,540ha Đình Vũ-Cát Hải EZ comprises nine industrial parks. To date, it has lured many projects in the fields of high technology, processing and manufacturing of leading domestic and world corporations with a total investment capital of US$32 billion.

Kiên said the EZ has contributed to Hải Phòng's industrial restructuring, promoting its industrialisation and modernisation, bringing the city deeper participation in the global value chain.

However, the zone now reports an occupancy rate of 80 per cent while clearance in the remaining areas faced many difficulties due to crowded population and inadequate resettlement land funds. 

Kiên said he believed that the establishment of Hải Phòng Southern EZ is the basis to catch the wave of investment capital, welcoming investors in the fields of high technology, semiconductors and green and circular industrial parks while helping take full advantage of the city's strengths and potentials. 

During the event, Ko Tae Yeon, Chairman of KOCHAM Hải Phòng said the EZ is expected to be an attractive destination for South Korean investors.

South Korean investors have pumped over $10 billion into 106 projects in Hải Phòng thanks to the country's stable political environment, the State and the city's incentives for foreign enterprises, its favourable location and developed transportation infrastructure, the chairman said. 

The South Hải Phòng EZ is expected to cover about 20,000ha in the districts of An Lão, Kiến Thụy, Tiên Lãng, and Vĩnh Bảo. 

It will house important infrastructure projects including Tiên Lãng airport, Nam Đồ Sơn port, and two logistics centres in Kiến Thụy and Tiên Lãng, along with a port system along the Văn Úc river. 

Kiên said his city is completing documents and procedures to submit to the Prime Minister for approval not later than the second quarter of 2024.

Lots of ground to cover to build 130,000 social housing units this year

There is still much to do to accomplish the Government's objective of completing 130,000 social housing units nationwide in 2024, heard participants at a meeting, chaired by Prime Minister Phạm Minh Chính in Hà Nội this morning.

Policymakers and property developers have long voiced their concerns over a lack of interest by local governments in the development of social housing and housing for workers, resulting in the absence of clearly defined targets for affordable housing in localities' 5-year housing development plans.

To make matters worse, investors and developers have been keeping a distance from the affordable housing segment due to the investment procedure sequence, conditions for purchasing, renting, and leasing social housing still complex and time-consuming, and the incentives for investors in social housing and worker housing projects are considered not attractive enough.

Land funds for developing social housing have not been identified in urban and industrial zone planning; apart from the 20 per cent social housing land allocation in commercial housing projects, most localities have not paid attention to reserving land funds for social housing projects.

There hasn't been a determined and proactive approach in developing affordable housing, and there are no plans to ensure the completion of their set objectives. Despite having a large population of low-income labourers concentrated in major cities with high demand for social housing, the cities have managed abysmally low numbers of social housing units in 2024, namely Hà Nội with 1,181 units, HCM City with 3,765 units, Đà Nẵng with 1,880 units, Cần Thơ with 1,535 units.

There have been reports of approved projects yet local authorities have not shown interest in the selection of project investors for implementation. Meanwhile, some projects have been started but progressed extremely slowly or lack funding due to local authorities failing to submit them for the Government's preferential loans.

The VNĐ120 trillion (US4.85 billion) funds under Resolution No. 33/NQ-CP of the Government have not been effectively disbursed. So far, there have been 127 social housing projects registered nationwide with a total of 114,934 units under construction. However, only 28 localities have announced their list of 68 projects eligible for preferential loans.

Even after the State Bank of Vietnam (SBV) has twice reduced the interest rates for the VNĐ120 trillion funds, with the interest rate applied in the first half of 2024 being 8 per cent per annum for investors and 7.5 per cent for homebuyers, and the preferential interest rate period being short, three years for investors and five years for individual customers, it has not been considered as attractive by both.

In order to address some of the above-mentioned problems, the Ministry of Planning and Investment (MPI) has been tasked to lead and coordinate with the Social Policy Bank, and the Ministry of Construction (MoC) to allocate sufficient capital to provide loans for individuals to buy, rent, or lease units in social housing projects. The state budget allocated has been estimated at VNĐ6,000 billion.

Meanwhile, the MoC was told to work together with localities to focus on achieving the target of completing 130,000 social housing units in 2024 as directed by the Government in Resolution No. 01/NQ-CP dated January 5, 2024. 

Bình Dương aims to attract investments for new-generation industrial parks

In 2024, Bình Dương Province plans to attract 130-140 investment projects to industrial parks (IP), securing US$1.2-1.3 billion from foreign capital and VNĐ1.1-1.2 trillion from domestic investors.

The plan includes a total construction investment capital of VNĐ5.7 trillion ($230.6 million), with the provision of leasing or subleasing 100-150 hectares of land. The objective is to attract 15,000 workers and achieve a total revenue of $35-40 billion.

The management board of Bình Dương Province's industrial parks reported that there are currently 28 operational IPs in this area, with an impressive occupancy rate of over 93 per cent.

This makes Bình Dương the locality with the highest IP occupancy rate in the entire country.

To date, Bình Dương's IPs have attracted 3,080 active projects. Among them, are 2,400 foreign-invested projects with a registered capital of nearly $29 billion and 680 domestic projects with a registered capital of nearly VNĐ93.6 trillion.

From 2023 to 2025, the province has developed 10 IPs, covering a total land area of about 3,154 hectares.

For 2026-30, the plan expands to 19 IPs, with a total land area of around 5,537 hectares. This includes the completion of the ongoing development of the IPs from the 2023-25 period, covering an area of about 2,063 hectares, and the addition of nine new IPs, spanning 3,474 hectares.

These IPs will follow the "3-in-1" model, combining IPs, urban areas, and service areas. They will feature comprehensive and modern technical and social infrastructure.

The investment attraction for these IPs will be more focused and selective, emphasising specialisation, ecological considerations and smart developments. 

Businesses compare notes at awards ceremony for achieving success

Businesses shared tips and experiences on business strategies at the Vietnamese High-Quality Goods Awards ceremony held in HCM City on March 14.

Nguyễn Lâm Viên, chairman of Vinamit JSC, which processes agricultural produce, said there was a new market trend for “green foodstuffs” and “healing foods.”

"Việt Nam is rich in resources and has a young and experienced workforce in the agriculture and the foodstuffs sectors, and these serve the domestic market but can also help Việt Nam catch up with global production and consumption trends," he said.

While there will be challenges, there are also plenty of opportunities for foodstuff businesses that satisfy international standards or are preparing for that, according to Viên.

As green and clean production is a decisive factor for sustainable development, Huỳnh Văn Thòn, chairman of agricultural company Lộc Trời Corporation, said his company focused on providing training to farmers and employees.

It was also important to build supply chains that apply green and clean processes such as scientific research in farming methods, ensuring food safety and quality and traceability.

Nguyễn Mạnh Dũng, general director of Vi Na Kitchenware JSC, said each country had its own requirements, and businesses needed to keep themselves up to date on the standards in various foreign markets.

“Quality is not just a target, it is a decisive factor in whether a business lives or perishes… Businesses need to always improve their product models, reduce costs and optimise prices to adapt to the business environment.”

Trần Thái Nguyên, deputy general director of Qui Phúc Commerce and Service Co., Ltd., said a business needed to focus on the domestic market first before expanding its export channels, such as by improving customer service and building distribution systems.

Trần Lệ Nguyên, CEO of KiDo Group, said businesses needed to quickly adopt the model of selling goods through multiple channels, and KiDo had switched to online selling in recent years.

To build an effective online sales channel, it was important to have a substantial amount of followers, and so a business’s media channels and platforms must not only focus on advertising and selling goods, but also interacting with online followers and providing entertainment, he said.

KiDo set up an official TikTok account for online content and sales livestreaming called E2E, which quickly garnered a great deal of attention.

Vũ Kim Hạnh, chairwoman of the Business Association of High Quality Vietnamese Products, said since Việt Nam was increasingly integrating into the global economy, developing new business models, selling goods through multiple channels and exporting were crucial.

The association’s “Vietnamese High Quality Product – Global Integration Standards” programme has certified 224 businesses and been helping them and others conform to quality standards to strengthen their brand image and develop sustainably. 

Việt Nam to revise gold market regulations: amendments to Decree 24/2012/NĐ-CP underway

Decree 24/2012/NĐ-CP, which governs the management of gold import and export activities by the State Bank of Việt Nam, is being revised to address the changing dynamics in the gold market.

Since 2014, no licences have been issued for gold imports for the production of gold bars, resulting in limited raw material supply. This has led to fluctuations in domestic gold prices, a significant price disparity between SJC-branded gold and other brands, and potential instability in the financial market and currency.

Therefore, there is a need to amend Decree 24/2012/NĐ-CP to ensure effective management of the gold market while maintaining its integrity.

Recognising the necessity for revision, Deputy Governor of the State Bank of Việt Nam, Đào Minh Tú, has acknowledged that Decree 24/2012/NĐ-CP should have been amended earlier to adapt to the current state of the gold market. The aim is to align supply and demand and consider alternative approaches to gold market management.

Under the current decree, the State Bank of Việt Nam holds a monopoly on gold bar production, while gold jewelry and art are managed by relevant authorities. The State Bank, therefore, will re-assess the role of Decree 24/2012/NĐ-CP to determine its effectiveness and propose necessary changes.

The deputy governor said: "Many experts also believe that it is time to reconsider SJC gold in comparison to other types and brands of gold. The ultimate goal is to manage the gold market without affecting the macroeconomy and safeguarding the interests of 100 million people." 

Nguyễn Đức Anh, Deputy General Director of Bảo Tín Mạnh Hải Joint Stock Company, suggests allowing qualified enterprises to participate in gold bar production. This would contribute to stabilising the prices of SJC gold and gold bars, reducing the price difference compared to the global gold market as witnessed recently.

Shaokai Fan, regional director for Asia-Pacific (excluding China), and head of Central Banks at the World Gold Council, expresses the need to carefully consider various options in amending Decree 24/2012/NĐ-CP without disrupting the gold market. Any new regulation allowing gold imports will help narrow the price gap between domestic and international gold prices, ensuring the rights of investors.

The policy restricting gold imports is identified as the primary factor causing a considerable disparity between domestic and global gold prices in Việt Nam and Prime Minister Phạm Minh Chính has provided directives to address this issue, Shaokai Fan tells Đầu Tư (Investment) Newspaper.

Many experts and businesses hope that the gold market will experience greater liberalisation in the future. Any new regulations permitting gold imports will help narrow the price gap between domestic and international gold, safeguarding the rights of investors.

Observing global practices, it is evident that several countries effectively manage their gold markets by considering gold as a financial product rather than a mere physical commodity. Việt Nam can learn from the gold market management models adopted by countries such as China, India, and Turkey. Despite relying primarily on gold imports without domestic production, these nations successfully meet their domestic gold demand, according to Shaokai Fan.

In a regular government meeting in February, Prime Minister Phạm Minh Chính instructed the State Bank to promptly propose amendments to Decree 24/2012/NĐ-CP on gold business management. The Prime Minister's Directive No 06/CT-TTg on February 15, 2024, also urged the State Bank to expedite the review of the Decree and propose effective solutions for gold market management in the first quarter of 2024.

According to Đào Xuân Tuấn, Head of the Foreign Exchange Management Department under the State Bank, the State Bank, in collaboration with relevant ministries and agencies, is actively reviewing Decree 24/2012/NĐ-CP and considering all existing issues.

The objective is to ensure effective gold price management while preserving market integrity. The State Bank continues to monitor the gold market closely and is prepared to implement measures to stabilise the market as needed, he said.

Deposit interest rates forecast to hit bottom in Q1 2024

Deposit interest rates are unlikely to decrease further and might hit bottom in the first quarter of 2024 as credit demand will increase this year, analysts forecast.

In a macro report released last week, analysts of the MB Securities Company (MBS) believe that in the context of more positive growth of export and investment and consumption against last year, capital demand will return to balance instead of surplus as currently. They forecast that credit growth in 2024 will reach about 13-14 per cent.

However, MBS analysts believe the pressure to increase interest rates is not great because the US monetary tightening cycle has almost ended. With the forecast that the US Federal Reserve (Fed) will lower interest rate to approximately 4 per cent by the end of 2024, the pressure on the foreign exchange rate is not great that will help the State Bank of Vietnam to have room to maintain the current monetary policy.

"We forecast that 12-month deposit interest rates of large commercial banks will be able to move up by 25-50 basis points, returning to 5.25-5.5 per cent in 2024," MBS analysts said.

Some private banks have recently started to inch up interest rates mainly for short terms of less than five months to 2.5-3.8 per cent per year to attract more depositors after the Lunar New Year. As for 12-month deposits, the rate has fluctuated around 5 per cent per year.

State-owned banks have not yet shown any move to adjust interest rates and their average interest rate is currently still 4.7 per cent for a 12-month term.

In the interbank market, interest rates peaked on February 22 this year due to seasonality that put pressure on short-term liquidity and pushed up overnight interest rates to 3.7 per cent. However, right after that, the rates have gradually cooled down and returned to a low level. Overnight interest rate is currently listed at 1.4 per cent, down more than two-thirds from their peak and interest rates at other short terms of one month or less are currently quoted in the range of 1.5-2 per cent.

The State Bank of Vietnam (SBV) continued to inject money through the open market operation (OMO) channel last month. On February 20 and 21, the SBV injected more than VNĐ6 trillion through the OMO channel with an interest rate of 4 per cent per year and a seven-day term. This money matured and returned to the SBV.

Meanwhile, the SBV’s bill issuance channel had no transaction, showing that liquidity in the banking system has returned to a stable state. 

HCMC – Long Thanh – Dau Giay Expressway becomes overloaded

The HCMC – Long Thanh – Dau Giay Expressway has repeatedly faced congestion, not to mention serious collisions, showing signs of being overloaded. 

Many frequent drivers on the HCMC – Long Thanh – Dau Giay Expressway complained that traffic flow on this 26-kilometer route has been too slow these days due to high traffic volume and accidents. For instance, on February 3 this year, at Km34 + 700 in the direction from HCMC to Dong Nai Province, a pile-up of 4 automobiles led to a traffic jam of more than 10km. Many people had to switch to alternative routes on National Highway No.1 passing Dong Nai Bridge or Cat Lai Ferry.

Despite that low street quality, on February 1, 2024, the expressway was approved to increase its toll by 5 percent from VND2,000 to VND2,100 (US$0.085) per kilometer so that its investor – Vietnam Expressway Services Engineering JSC (VEC) – can ensure the maintenance of its financial plan and its ability to repay debt. At present, its toll revenue on this expressway is about VND4 billion ($161,800) a day.

Before this, on September 1, 2023, VEC had already raised the toll of certain vehicle types using this expressway by 10 percent. It explained that after a period of applying the toll reduction policy in compliance with Resolution 35/2016 by the Government, it could not repay its debt in accordance with the approved financial plan by the Transport Ministry.

Unluckily, the Covid-19 pandemic gravely affected its exploitation or building of expressways, namely Cau Gie – Ninh Binh, Ben Luc – Long Thanh, Noi Bai – Lao Cai, HCMC – Long Thanh – Dau Giay, and Da Nang – Quang Ngai.

As cited in the debt repayment schedule of VEC, the repaid amount will increase gradually from 2024, plus many routes under its charge are in need of repair after a long using time. Adding to that is the demand of VND6 trillion ($242.76 million) for VEC to construct the Ben Luc – Long Thanh Expressway and VND5.33 trillion ($215,65 million) to repay the Government bond and arisen interest (paid in advance by the Ministry of Finance).

The Transport Ministry informed that the first stage of the HCMC – Long Thanh – Dau Giay Expressway project used money borrowed from the Asian Development Bank (ADB), the Japan International Cooperation Agency (JICA), and the Government’s counterpart capital. Being built from 2009 – 2016, the route has a total length of 54km, with a total investment of over VND18 trillion ($728.5 million), one-third of which was from state budget.

Since its operation, the HCMC – Long Thanh – Dau Giay Expressway has had to accommodate a huge volume of traffic, with an average increase of 10.45 percent per year. The recent introduction of the two neighboring expressways of Dau Giay – Phan Thiet and Phan Thiet – Vinh Hao has made matters much worse. On average, each day, about 60,000 vehicles travel on this expressway, with the peak being 78,000 – nearly double the capacity of the route.

To amend the situation at peak hours or during an accident, the operation unit usually cooperates with the traffic police force to regulate the traffic flow. This method, however, greatly annoys drivers since traveling time is longer, meaning most transport costs for businesses. Obviously, the rising toll does not correspond with higher street quality and creates unfairness to street users.

Dong Nai Province has repeatedly proposed that the Transport Ministry accelerate the expansion of this key expressway; otherwise, the situation will only be a lot worse when Long Thanh International Airport comes into operation in 2026.

According to Deputy Director Phan Cong Bang of the HCMC Transport Department, his organization has already sent a request to the municipal People’s Committee for VND1 trillion ($40.5 million) from the city budget to widen the section of the HCMC – Long Thanh – Dau Giay Expressway passing HCMC from six to eight lanes. The plan was approved by the Transport Ministry, and land clearance has been complete, ready for construction. Nevertheless, a local expansion like this does not truly address the overall problem of congestion and collision if the section passing Dong Nai Province is still rather narrow.

Wood, furniture firms advised to take advantage of e-commerce

To increase brand recognition and to access more customers, Vietnamese wood, furniture, and handicraft businesses need to consider and invest systematically in online sales activities, diversifying sales channels in their business strategies, Vice Chairwoman of the Handicraft and Wood Industry Association of Ho Chi Minh City (HAWA) Duong Minh Tue has said. 

Speaking at a recent workshop themed “Cross-border e-commerce – global growth opportunity for Vietnam's furniture export” in Ho Chi Minh City, Tue said that as one of the leading wood exporting countries globally, Vietnam's wood industry has expanded its market, penetrating deeper into key ones such as the US, the European Union (EU), the Republic of Korea (RoK), and Japan; and increasing its presence in emerging markets such as the UAE and India, he said.

With strengths in forestry development, incentives for businesses, and free trade agreements signed with foreign partners, Vietnam's wood and wooden product exports have recorded great success in the international market.

However, over recent times, the traditional export market segment has faced numerous challenges due to weak global consumption demand, increasing protectionist barriers, and countries continuing to maintain tight monetary policies, Hue said.

Meanwhile, the sales of furniture and handicrafts through e-commerce have continued to experience remarkable growth, she said, noting that participating in e-commerce platforms is a new direction for Vietnamese wood businesses.

To increase brand recognition and access more customers, businesses need to consider and invest systematically in online sales activities, diversifying sales channels in their business strategies, she said.

Senior Account Manager of Amazon Global Selling Vietnam Nguyen Thanh Yen My said that although global trade has not fully recovered, global e-commerce continues to grow steadily.

Cross-border e-commerce is a trend and a new form of export, which helps small- and medium-sized enterprises achieve strong growth, she added.

According to My, in the US - Vietnam's largest export market, e-commerce in the furniture industry is projected to grow strongly over the next four years and could reach 118.6 billion USD by 2027.

Wayfair Supplier Acquisition Senior Manager Jimmy Wang noted that through e-commerce platforms, Vietnamese businesses can directly access a wide range of customers from all over the world.

Recently, many Chinese suppliers have bought Vietnamese furniture and resold it globally through cross-border e-commerce. The question is why Vietnamese manufacturers don’t take advantage of cross-border e-commerce to sell their products.

Wang said that online shoppers usually hesitate to buy goods online as they cannot touch the products physically. Therefore, to sell online effectively, sellers must prioritise comfort and actively convince customers about the products they want to buy.

In addition, customer service and delivery are also issues of concern to buyers. Understanding the above reasons, e-commerce platforms currently provide many business support services from posting products online, packaging, shipping, and returning goods to bring the best shopping experience for customers.

Vietnam, RoK strengthen agricultural cooperation

Vietnam, one of the world’s leading agricultural exporters, wants to bolster cooperation in the field with the Republic of Korea (RoK) who boasts strengths in applying advanced technology into cultivation and processing, Minister of Agriculture and Rural Development Le Minh Hoan said on March 18.

At a workshop jointly held by the Ministry of Agriculture and Rural Development and the Korea International Cooperation Agency (KOICA) in Hanoi, Hoan highlighted that both countries hold great potential to cooperate in developing agriculture, elaborating Vietnam has been famous for its rice, vegetables and fruits and aquatic products while the RoK has a modern agriculture with various kinds of seedlings.

Over the past time, they have worked together in technology transfer to branch out biofuel crops, high-quality vegetables, medicinal mushrooms and safe food production, as well as in trade promotion for products of both sides’ strengths, among others, he added.

He took the occasion to thank KOICA for its support to build the Vietnam – Korea cooperation vision in agriculture and rural development during the 2024-2030 period, saying the report has an important role to play in identifying potential cooperation areas, promoting comparative advantages of the two countries, and diversifying forms of cooperation and investment so as to enhance efficiency and ensure sustainability.

Meanwhile, KOICA President Chang Won Sam said that KOICA sees agriculture a key cooperation area between the two countries, and will support the collaboration under its mid-term and long-term strategies through various projects such as improving value chain, promoting market connectivity, and enhancing capacity for climate change response.
 
"The key words for the cooperation in the time ahead is digitalisation, climate change, innovation and sci-tech application in agriculture," he said. 

According to Deputy Director of the Institute of Policy and Strategy for Agriculture and Rural Development Nguyen Anh Phong, the RoK is currently the fourth largest importer of Vietnamese agro-forestry-fishery products.

Since the Vietnam – Korea Free Trade Agreement took effect in 2015, Vietnam’s agricultural export to the East Asian country has been on strong surge, with average revenue of more than 2 billion USD a year during 2016-2023.

Meanwhile, Vietnam is also the 4th largest market of the RoK’s agro-forestry-fishery goods. Boosted by the free trade deal, RoK’s shipment of those products to Vietnam has grown at an average 6.2% per year.

Although the RoK is the biggest foreign investor in Vietnam, its capital funneled to the agricultural sector makes up only 0.17% of its total FDI in the country. Most of the investment has been poured into localities with preferential policies and holding favourable conditions in weather, land, infrastructure, labour force and material areas.  

Phong said the RoK is the second largest ODA provider for Vietnam’s agriculture, adding the capital has contributed to improving productivity and quality; however, it accounts for only 3.36% of the total ODA the country has offered Vietnam./.

Can Tho lures Japanese investment with skilled workforce, infrastructure advantages

Chairman of the People’s Committee of the Mekong Delta city of Can Tho Tran Viet Truong highlighted the potential benefits awaiting Japanese enterprises investing in the city during a working session on March 18 with a delegation of executives of Japanese banks led by Managing Executive Officer of Gunma Bank Uchibori Takeo.

Truong underlined the advantages Can Tho offers, including a readily available workforce, access to raw materials, well-developed transportation infrastructure, and a favourable urban environment. He pointed to the National Assembly’s Resolution issued in 2022, which allows Can Tho to apply some specially-designed policies to attract resources for infrastructure, human capital and digital transformation initiatives, including those from abroad.

Can Tho boasts a robust industrial park network, with six parks currently operational and one under construction covering a total area of nearly 992ha. It is actively seeking investment in the Hung Phu 1 and Vinh Thanh industrial parks.

Beyond infrastructure, Can Tho possesses a significant advantage in its human resources. It has the largest number of skilled workers in the Mekong Delta, with eight universities and 63 vocational training institutions contributing to the talent pool. Notably, around 8,400 students are pursuing studies in fields like information technology, electronics, telecommunications, e-commerce and digital economy. Every year, some 1,700 college and university graduates enter the workforce equipped with digital transformation skills.

Furthermore, FPT University in Can Tho offers a dedicated Japanese language programme while Can Tho University has incorporated Japanese as a supplementary language within its foreign language faculty. Other universities and colleges collaborate with businesses and organisations to provide training courses that prepare workers for potential employment opportunities in Japan.

Uchibori expressed confidence in the future of strong bilateral cooperation between Japan and Vietnam, noting the recent upgrade of relations between the two countries to a comprehensive strategic partnership in November 2023. He said the existing cooperative relationships between Can Tho and Japan's Hyogo prefecture, Okayama and Nasushiobara cities have established a solid foundation for further collaboration, particularly in the financial and banking sectors.

He thanked the municipal authorities at all levels for their support during the delegation's fact-finding trips to various locations. He also pledged to facilitate the dissemination of information to Japanese leaders and businesses interested in collaborating with Can Tho./.

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