Vietnam’s increasing allure for foreign investment is expected to brighten further for the rest of this year.

Hai Duong People’s Committee last week approved some notable manufacturing ventures. The first involves the manufacturing of toys, stationery, and household electrical appliances by Hong Kong-based Korninghill Group with an investment of $3 million, while Jia Ri Xing, also from Hong Kong, will create walkie-talkies and plastic products at a $4 million facility.

The committee has also just delivered investment licences to the $2 million metal and plastic product venture from Jiaxu Development Industrial; and Qizhen Industrial’s $4 million project involving plastic household items and electronic products.

The companies have yet to reveal when operations of these ventures will begin.

In early January, Hai Duong had already approved large-scale projects worth a total value of $1.5 billion. These include a $270-million stationery manufacturing factory from Deli Vietnam Office Technology, a $260-million factory from Biel Crystal Technology Manufacturing, and a $120-million solar photovoltaic panel factory involving Boviet Hai Duong Solar Technology.

The moves point to Hai Duong having a successful year in foreign direct investment (FDI) mobilisation, which was more than $1.2 billion in 2023. Despite ranking 11th among localities last year in this regard, it is still deemed remarkable progress as compared to 2022, with $370 million of FDI inflows and a rank of 17th.

Also in February, Thai Binh province in the north announced that a factory for Good Way Vietnam, from Taiwan, started construction at Lien Ha Thai Industrial Park to produce connection devices and external computer equipment. The initiative is set to cost around $45 million.

Although it used to be a modest locality in attracting FDI, at around $307 million in 2022, Thai Binh is quickly becoming a destination for more investors. Last year, the province attracted nearly $2.8 billion, jumping to fifth place among top localities in terms of FDI mobilisation localities.

In October 2023, HiteJinro Group from South Korea announced investment in a beverage factory in Lien Ha Thai Industrial Park worth $100 million. Thai Binh People’s Committee also approved other investors to join the park, including Pegavision Vietnam from Taiwan and China’s Longstar Lighting Thai Binh, with a total investment of $225 million.

Similarly, in 2023, the central province of Nghe An made a breakthrough with more than $1.6 billion of FDI inflows, ranking eighth.

Nguyen Duc Trung, Chairman of Nghe An People’s Committee, noted that the province is home to major projects involving the likes of Foxconn, Luxshare, and Goertek.

“Funding promotions are being carried out drastically to enable the province to be in the top 10 leading localities in FDI mobilisation this year,” Trung said. “We have been implementing several measures to attract funding, including readiness for planning, basic infrastructure, human resources, and readiness to improve administrative procedures and the general investment environment.”

According to the Ministry of Planning and Investment (MPI), more than $2.36 billion was registered in Vietnam in January this year, an increase of 40.2 per cent on-year. The disbursement amount was $1.48 billion, up 9.6 per cent on-year.

“This is a good outcome, confirming the attraction of Vietnam in overall FDI picture, and it will continue to brighten,” said Do Nhat Hoang, director general of the Foreign Investment Agency under the MPI.

Hoang added that FDI disbursement this year could be a record $23.5 billion, up 1.3 per cent compared to 2023, while registered FDI in 2024 is expected at $36-37 billion, equivalent to last year.

Despite little growth, the numbers are said to be strong in the context that global FDI is decreasing in numerous regions and countries like the EU, United States, and some developing markets. Of these, China has reported a sharp decrease. FDI into China sat at $33 billion last year, a drop of 80 per cent compared to 2022 and the second consecutive year of decline.

Meanwhile, Vietnam gains some benefits, especially in fields such as semiconductor manufacturing, AI, and high-tech industries.

Vietnam is also slated to benefit from promises by the US to spend $500 million to improve semiconductor manufacturing capacity, cybersecurity, and the global business environment.

Vietnam Airlines cancels flights to Germany due to air strikes

The national flag carrier of Vietnam, Vietnam Airlines, has decided to temporarily suspend flights to Frankfurt (Germany) due to air strikes at German airports.      

Accordingly, flight VN37 from Hanoi to Frankfurt and flight VN31 from Ho Chi Minh City to Frankfurt will take off on March 7 evening instead of March 6 evening as scheduled.

Two return flights – VN36 from Frankfurt to Hanoi and VN30 from Frankfurt to Ho Chi Minh City are rescheduled to take off on March 8 afternoon instead of March 7 afternoon.

Vietnam Airlines deeply regrets having to change its flight schedule due to a strike at Frankfurt airport and hopes to receive the understanding of passengers in this unexpected situation, said the airline in its announcement on March 6.

The airline pledged to support affected passengers according to current regulations.

It also recommended that passengers planning to travel to/from or transit through Frankfurt airport during this time should regularly monitor and update flight information to get timely support in case of need.

Reuters reported that Frankfurt airport, Germany's busiest, will be closed to passengers with planned departures on March 7 due to a security staff strike organized by Germany's Verdi union.

It is the latest wave of industrial action to hit Europe's largest economy, where high inflation and worker shortages have put a strain on wage negotiations, leading to repeat strikes in the travel sector.

Export furniture fair opens in HCM City

The Ho Chi Minh City Export Furniture Fair 2024 (HawaExpo 2024) kicked off on March 6 at the Saigon Exhibition and Convention Centre in district 7 and the White Palace Convention Centre Pham Van Dong in Thu Duc city.

Nguyen Quoc Khanh, Chairman of Viforest Fair - the event’s organiser, said HawaExpo 2024 - the largest export furniture fair in Vietnam - gathered more than 500 exhibitors, 80% of whom are domestic producers while the remainders include prominent wooden furniture and handicraft manufacturers from ASEAN countries as well as local and foreign design units, raw material suppliers, and accessory providers.

The four-day event provides opportunities for enterprises to boost direct and online trading through the Hopefairs. They can also expand sales on cross-border e-commerce platforms with the support of two leading units in the world, namely Amazon and Wayfair.

Aside from showcasing products and business matching events, the fair will feature in-depth seminars on the carbon credit market from forests and solutions to sustainable development of acacia wood resources and enhancing the value of the Acacia Vietnam wood brand, he said.

Deputy Minister of Agriculture and Rural Development Nguyen Quoc Tri said that last year, Vietnam’s exports of wood and wooded products dropped 15.5% year-on-year because consumers tighten spending on non-essential products in the context of high inflation due to the impact of geopolitical conflicts.

Despite facing many difficulties and challenges, there have been positive signs for the wood industry in 2024, the official said. The Ministry of Agriculture and Rural Development estimated that the export value of wood and wooded products will reach about 15 billion USD this year, an increase of about 6% compared to 2023.

To achieve the above-mention target, it is necessary for the forestry industry to make further efforts and have fundamental solutions relating to technological innovation, using of raw materials, manufacturing and distribution of products, Tri said, adding that the fair will be an effective trade promotion channel to help popularise Vietnamese wood and wooded products to customers around the world.

Processing-manufacturing industry attracts most Australian investments: Ministry

The processing and manufacturing sector has lured the most Australian investments in Vietnam, the Ministry of Planning and Investment reported.

The ministry said Australian businesses have invested in 631 projects in the Southeast Asian nation, with a total registered capital of 2.04 billion USD.

Among the 18 sectors in which Australian firms have poured capital into, processing and manufacturing received the most with 133 projects worth 954.68 million USD, followed by lodging and catering services with 31 projects valued at 154.32 million USD.

The agro-forestry-fishery sector ranks third with 25 projects and 120.04 million USD, according to the ministry.

Among 45 cities and provinces receiving Australian investments, the southern province of Ba Ria - Vung Tau takes the lead with 16 projects worth 392.21 million USD, followed by Ho Chi Minh City and Hanoi.

Vietnam has so far attracted 39,553 FDI projects worth 473.1 billion USD, with nearly 300 billion USD disbursed.

Meanwhile, Vietnam has injected more than 550 million USD into over 90 projects in Australia.

The bilateral trade stood at about 14 billion USD last year, making the two countries among the top 10 trade partners of each other.

Tuyen Quang breaks ground on new biomass fuel plant with Japanese partner

Authorities of northern Tuyen Quang province and Japan’s Erex JSC kicked off the construction of the Erex Sakura Tuyen Quang biomass fuel plant on March 6.

The ceremony marked a significant step forward for the project, which will occupy a 3.3ha site and have a total investment of over 478.8 billion VND (20.4 million USD). Once operational in 2025, it is to produce 150,000 tonnes of biomass pellets and 150,000 tonnes of wood chips per year.

The project is anticipated to contribute to addressing issues like environment pollution and greenhouse gas emissions, while promoting the sustainable development of biomass energy industry in Tuyen Quang.

Honna Hitoshi, President and Representative Director of Erex JSC, said the project contributes to realising Vietnam's net emission reduction policy, providing stable electricity and meeting economic development needs of Vietnam and Tuyen Quang in particular. 

Chairman of the provincial People’s Committee Nguyen Van Son urged departments and agencies to work closely with the investor to step up the plant construction

Tuyen Quang now boasts 20 active projects involving 17 foreign investors, with a total investment exceeding 340 million USD. It also benefits from the support of numerous international partners, with the Japanese groups extending their involvement in 25 projects across health care, education and the environment, with a combined value of over 1.4 million USD.

Turkmenistan Airlines launches first direct flights to Vietnam

A Boeing 777-300ER of Turkmenistan Airlines departing from Turkmenistan’s capital of Ashgabat landed at Tan Son Nhat airport in Vietnam’s Ho Chi Minh City at 1:30 a.m. on March 6, kick-starting a direct air route between the two countries.

The airline is scheduled to operate two flights per week on Wednesdays and Thursdays, from March 5 to October 27. A round-trip ticket is priced at about US$500, equal to VND12 million, for economy class.

Toyli Sakhadov, senior leader of Turkmenistan Airlines, said the airline has viewed Vietnam as a potential market since 2014. To prepare for the service, he added, the firm signed a contract in 2022 to purchase two Boeing 777-300ERs to run flights between the two destinations.

The new air service has helped to shorten the travel time by nearly half, as it takes only nine hours to fly from Ashgabat to Ho Chi Minh City compared to 18 hours previously.

Before launching commercial routes, Turkmenistan Airlines operated a cargo route for the first time to Vietnam using the Airbus-330-200P2F in 2022. By 2023, the carrier was operating one more cargo flight to Hanoi every week.

China's CDH Investments eyes a minority stake in Bach Hoa Xanh

As reported by Reuters, CDH, one of China's biggest alternative investment firms and also a former Mobile World investor, has emerged as the frontrunner to buy a stake of between 5 and 10 per cent in supermarket chain Bach Hoa Xanh (BHX) after outbidding rivals.

This potential deal by CDH is a testament to the interest shown by foreign investors in Vietnam's lucrative retail market after previously moves by investors from South Korea, Japan, and Thailand. Last September, Lotte Group opened its new mall in Hanoi’s Tay Ho district, while THACO opened its third Emart hypermarket in Ho Chi Minh City.

According to a survey by the Japan Trade Promotion Organisation, every single one of Japan's retail businesses in Vietnam has expansion plans here. Japanese retail group Aeon is accelerating the planned opening of new malls and other stores in Vietnam.

Mobile World, the parent company of Bach Hoa Xanh, first revealed its plan to sell a minority stake in 2022. However, the plan was put on hold amidst the challenging market conditions at that time. The company resumed the sale process last year, which gained the attention of Singapore-based sovereign wealth fund GIC and other investors from Thailand.

Established in 2002, CDH is a diversified alternative asset manager covering private equity, venture capital, mezzanine, real estate, and wealth management. Meanwhile, Bach Hoa Xanh, which was founded in 2015, runs more than 1,700 stores in Vietnam's southern and south-central provinces.

Azamara Journey brings over 1,000 foreign visitors to Da Nang

The Azamara Journey cruise ship docked at Tien Sa port in the coastal city of Da Nang on March 5, bringing more than 1,000 international tourists to the heritage land of Vietnam.

Upon arrival in Da Nang, the visitors, mainly from the UK, United States, Germany and China, were given the chance to explore many of the famous local tourist attractions such as the Cham Museum, Han market, the Marble Mountain scenic area, Linh Ung pagoda, and My Khe beach.

Meanwhile, Tien Sa port also welcomed the international cruise ship Seabourn on March 6, with an additional 500 British, French, and American tourists on board.

The two ships are scheduled to leave Da Nang at 6 p.m. on March 6.

Da Nang is scheduled to welcome 12 more cruise ships throughout March and April that are expected to bring about 16,000 foreign travelers to the central city.

Last year saw Da Nang receive a total of 22 international cruise liners with 18,000 arrivals on board, and the figures are expected to double this year.

Foreign-invested groups to assist localities in attaining export turnover growth

Many localities expect soaring growth in export turnover of electronics and electric products in 2024 thanks to the contribution of new facilities expected to come into operation soon.

The central province of Nghe An has set a target to acquire nearly $700 million in export turnover from electronic products, spare parts, and components for the whole year, equalling one-quarter of the export value of the province this year. The total number of electronic products and parts is expected to touch nearly 600 million.

Nghe An is currently the only locality in the country that has gathered the five big electronics names of Foxconn, Luxshare, Goertek, Everwin, and JuTeng.

This year, many facilities invested by these manufacturers will be taken into operation, such as Everwin Precision Technology Vietnam’s $115 million plant, phase 1. It is designed to make 270 million products per annum. The Hong Kong manufacturer - a supplier of components for Apple, Xiaomi, and Huawei - plans to export all products to the United States and China.

Meanwhile, Goertek Precision Industry’s $100-million first phase, also expected to start operation this year, covers 40 hectares at WHA Industrial Zone 1 in Nghe An province and will have an annual capacity of over 380 million products. Almost all products will be exported to China, the US, or South Korea for partners such as Samsung, Amazon, Google, Sony, Microsoft, and Meta.

Last year, Nghe An’s total export turnover exceeded the $3 billion mark for the first time, reaching $3.11 billion; of which goods exports reached about $2.5 billion.

Ho Phi Trieu, deputy director of Nghe An Department of Planning and Investment, said, “The breakthrough growth in attracting foreign capital in recent years is the basis for the province to expect a high target in export turnover of the electronics sector. It is a feasible target because almost all investors are eager to implement their projects. At the same time, we are aiming to draw in new projects in the high-tech sector.”

Other localities known as production hubs for big electronic manufacturers expect more contribution from FIEs in promoting export turnover this year.

In the northern province of Bac Ninh, Amkor Technology is currently a strategic manufacturing partner of many of the world’s top chip companies such as Qualcomm, Samsung, Foxconn, LG, and SK Hynix. In addition, Vietnam is also an important production hub of Amkor.

Thus, the export turnover from plants in Vietnam will also contribute an important part to the group’s revenue. The Vietnamese plant’s size will be only behind Amkor’s South Korean factory. According to the plan, it will invest about $1.6 billion before 2035 on building a state-of-the-art facility in Bac Ninh.

However, the general economic figures of localities can take a bump when such massive groups are involved deeply. In 2023, Samsung Vietnam was forecast to have gained approximately $57 billion in export turnover, lower than the figures of the previous two years. As a result, the regional GDP growth of Bac Ninh province fell by 6.18 per cent compared to last year.

Elsewhere, Dong Anh Quan, director of Bac Giang Investment and Promotion Centre, told VIR, “FIEs contribute a pivotal part in the export turnover of the province. In Bac Giang, the contribution comes from key manufacturers such as Foxconn, Luxshare, and its members. We especially expect a strong contribution from Hana Micron Vina, which started operations in September last year. Our mission is to support them to help accelerate disbursement.”

Statistics published by the General Statistics Office show that in 2023, FIEs played a crucial role in Vietnamese economic growth, which is demonstrated through their contribution to export revenue, job creation, and the formation of supply chains in key export industries, especially in electronics and machinery. In particular, such groups account for 99.6 per cent of phones, over 98 per cent of computers, 93 per cent of machinery.

Targets set high for disbursement

The government has made drastic directions to accelerate public investment disbursement, with construction of numerous transport infrastructure projects to be implemented around the clock.
 
Last week Prime Minister Pham Minh Chinh urged for implementation of key tasks, setting a target of disbursement of 95 per cent of public investment this year.

“This year must be the year to accelerate the construction of key transport infrastructure ventures- one of the three strategic breakthroughs that the Party and state have raised,” PM Chinh stated. “These ventures should become reality and generate important significance and benefits for the country’s socioeconomic development.”

The PM demanded that progress be pushed on key transport projects that cost approximately $17.6 billion in total. They include some parts of the North-South Expressway’s eastern cluster, Hanoi ring road 4 and Ho Chi Minh City ring road 3, Long Thanh International Airport, Tan Son Nhat Airport’s T3 terminal, and the 500KV transmission line circuit 3 from Quang Trach to Pho Noi.

Many major construction sites did not take a break for Lunar New Year. At the Tuyen Quang-Ha Giang expressway, which is costing over $415 million, many sections completed excavation and embankment. On the first official working day after the holiday, Minister of Planning and Investment Nguyen Chi Dung and a delegation visited to check the progress.

“I appreciate Ha Giang province in site clearance and preparing the best conditions to start construction. This expressway plays an important role in improving traffic in two provinces and the northern mountainous region,” Dung said.

In Ho Chi Minh City at the Nguyen Van Linh underground tunnel project, workers took on shifts throughout the holiday to speed up construction. Around a dozen key schemes were still under construction during the festive break in the city, including five traffic works with key connectivity and large construction volumes.

Of these, ring road 3 will have 10 construction packages in 2024 that will play a vital role in the progress of the entire project.

In 2023, the disbursement of public investment capital in Ho Chi Minh City reached $2 billion, nearly double that of 2022 and equivalent to 72 per cent of the yearly plan. In particular, disbursement in Q1 of 2023 was a measly 4 per cent. As a result, city authorities have been carrying out new solutions to ensure this quarter fares better.

“We have built a detailed plan for each bidding package, especially in key projects, for those without site clearance problems, and other constructions. The city is striving to reach a disbursement rate of 10 -12 per cent in the first quarter,” said Luong Minh Phuc, director of the project management unit for investment and construction of traffic works in Ho Chi Minh City.

This year, Ho Chi Minh City continues to be assigned the largest public investment allocation in the country, at nearly $3.3 billion. The city’s government estimates to contribute about one-fifth of the total budget of the city if this amount of capital is disbursed.

“We should not only look at the disbursement rate of public investment capital, but we must pay more attention to the disbursement value, amount, and number of ventures implemented and put into operation. Because they will encourage localities to dare to receive capital, enhance responsibility, and further carry out investments,” said National Assembly deputy Tran Hoang Ngan.

In 2024, the total capital that the legislature approved and allocated to ministries, central agencies, and localities is $27.4 billion, including $9.4 billion from the central budget, and the remainder from the local coffers.

In last week’s directive, the prime minister assigned the Ministry of Planning and Investment to preside over and coordinate with agencies and localities to monitor progress on disbursement. Based on the proposals of relevant authorities, the ministry will report on extending the time to allocate capital for projects assigned to the medium-term public investment plan covering 2021-2025.

Hanoi seeks solutions to sell Vietnamese goods to foreign distribution chains

In 2024, Hanoi will continue to provide trade promotion and financial support to local businesses to enhance cooperation with foreign distribution networks.

Tran Thi Phuong Lan, Director of Hanoi's Department of Industry and Trade, noted that in recent years many companies have demonstrated a better understanding of consumer needs, learned advanced quality management in supply chains, and improved product quality control, especially for agricultural, forestry and aquatic products that require traceability. This has ensured that their products meet the standards required to sell to leading global brands.

However, the number of successful companies is still small, as many companies have not been able to sell to foreign distribution systems, said Bui Duy Quang, deputy director of the Hanoi Promotion Agency.

"Foreign distributors have high demands on product quality, standards, origin and sustainable development, making it difficult to export through their retail channels," he explained.

In addition, most small and medium-sized enterprises often lack the expertise, skills and financial resources to upgrade their production and management to meet the requirements of foreign retail chains, he added.

Quang suggested that for Vietnamese goods to have a solid position in international supermarkets, local companies need to implement synchronized solutions from production to distribution and consumption, with a focus on ensuring quality.

"More importantly, the participation of financial institutions and large banks is needed to help enterprises access capital for upgrading machinery, equipment and facilities, as well as for scientific and technological innovation," Quang recommended.

To help businesses sell Vietnamese goods to foreign distribution systems, the Hanoi People's Committee recently issued a plan to implement the project "Encouraging Vietnamese Enterprises to Participate Directly in Foreign Distribution Networks by 2030".

Accordingly, the city will synchronously implement eight groups of tasks and solutions in 2024, such as holding business matching workshops between manufacturers and exporters and foreign distributors.

Hanoi will also host the Vietnamese Goods Week Programs at foreign distribution shopping malls and help local enterprises showcase their goods at these events.

The city will also actively conduct market research in various countries, organize trade linkages between Vietnamese enterprises and overseas Vietnamese entrepreneurs' distribution networks, and conduct promotion and marketing activities.

In 2024, the city plans to support more than 500 enterprises with market information and provide training and consultancy to more than 100 enterprises to improve their competitiveness and supply capacity to participate in global value chains.

It will also help more than 100 companies develop cross-border e-commerce capabilities, facilitate more than 100 links and transactions with overseas distribution networks, and support the direct sale of more than 80 products to overseas distribution networks.

The city will actively send manufacturers and exporters to explore foreign markets, learn market requirements, and establish relationships with distributors.

In addition, the city will conduct communication campaigns to raise awareness of the benefits of participating in the project, with the aim of changing perceptions and improving enterprises' understanding of the advantages of selling directly to foreign distribution networks.

The city will also research and develop policy mechanisms to encourage Hanoi enterprises to proactively establish distribution systems in overseas markets.

In recent years, Vietnamese quality products have reached millions of consumers around the world with the support of leading global retailers.

Ta Hoang Linh, Director General of the Department of European-American Market under the Ministry of Industry and Trade, said that foreign retailers consider Vietnam as a strategic location in their global sourcing strategy. The current challenge for enterprises is how to meet the requirements of foreign distributors and retail systems.

"In 2024, Vietnam's overseas trade missions will continue to support Vietnamese enterprises in seeking new business opportunities and promoting connectivity with global supply chains. This will enable them to better understand and maximize the benefits of free trade agreements in their business strategies," he told hanoimoi newspaper.

Some 30 overseas trade missions are expected to bring large delegations of buyers to Vietnam to participate in the Vietnam International Sourcing Expo, a global supply chain networking event being held in Ho Chi Minh City from June 6-8. The event aims to facilitate business meetings and explore trade opportunities, Linh said.

Paul Le, Vice Chairman of Central Retail Vietnam, believes Vietnamese businesses should focus on telling the story behind their products when participating in trade promotion programs and export linkages rather than just showcasing products.

For several years, the company has partnered with the Ministry of Industry and Trade to organize Vietnamese Goods Week in Thailand, helping businesses promote their brands and increase sales opportunities through distribution channels in Thailand.

 To have a presence on the shelves of Central Retail supermarkets in Thailand and expand to the world, Paul Le suggested that Vietnamese companies need to establish a strong foothold in the domestic market by focusing on processing, packaging, and branding. Especially in terms of product packaging, it should be easy to read and memorable, and both colors and the story of the product should be paid attention to, according to Paul Le.

Thai investors bolster operation in Vietnam in 2024

Vietnam continues to be a magnet for Thai investors who are spreading their wings to the neighbouring country to tap into lucrative opportunities.
 
Last week, SCB X Public Company Limited (SCBX), Thailand's fourth-largest bank by assets, announced that it will scoop up all of the charter capital in Home Credit Vietnam for VND20.97 trillion (approximately $860 million). The move is part of the Thai lender's bid to expand its footprint in Southeast Asia.

Home Credit Vietnam is a part of Home Credit Group, which was established in 1997 in the Czech Republic. The Home Credit Group operates in multiple countries across Asia and Europe and is owned by PPF Group, an international investment company.

Arthid Nanthawithaya, CEO of SCB X, said, “The acquisition of Home Credit Vietnam marks a significant milestone in SCBX’s journey to become a top regional financial technology group. This strategic acquisition strengthens our presence in the high-growth ASEAN market and also increases value and maximises return to our shareholders in the long term.”

“Vietnam, with its dynamic economy averaging 7.5 per cent GDP growth over the past decade and a tech-savvy population, is a key strategic market for SCBX,” Nanthawithaya said. “This acquisition marks the beginning of SCBX Group’s expansion into Vietnam, a country with a population of over 100 million. Home Credit Vietnam has a 15 million customer base, 14,000 point-of-sale locations, and an experienced management team of European and Vietnamese members.”

She further noted that Home Credit Vietnam will serve as an important base for SCBX Group’s presence in Vietnam and immediately contribute positive bottom line to the group after deal completion. This acquisition also diversifies the group’s income base for future strength, while maintaining a superior capital adequacy ratio both at SCBX and the bank after the completion of the transaction.

The transaction is expected to be completed by the first half of 2025, subject to approval from relevant authorities.

In early February, Central Pattana, Thailand’s leading retail property developer and a member of Thailand's Central Group, also announced its subsidiary CPN Global Co., Ltd. has set up a presence in Vietnam.

CPN Global Vietnam will be involved in real estate management to develop future projects on behalf of Central Pattana. With a registered capital of VND20 billion ($815,245), CPN Global Vietnam is a one-member limited liability company, in which CPN Global Co., Ltd. holds a 100 per cent stake.

Central Pattana’s foray into Vietnam is also aligned with the expansion of its sister firm Central Retail in the country. Central Retail has a plan to invest $1.45 billion in Vietnam from 2023 to 2027. The group aims to reach a sales target of $4.33 billion by 2027 and nearly double the number of its stores to 600.

Likewise, WHA Group, Thailand's leading developer of industrial estates, logistics facilities, industrial utilities and power, is continuing its expansion in Vietnam. Besides WHA Industrial Zone 1 - Nghe An, of which phase 1 has been highly successful with more than 77 per cent of tenancy reached, and the second phase currently under development planning, the company has plans for a further three industrial zone projects.

In addition, the company has set a target of reaching total sales of 178 million cubic metres for both water supply and wastewater management, divided into 142 million in Thailand and 36 million in Vietnam. This represents a growth rate of over 14 per cent, driven by the expansion of all types of water services in new WHA industrial estates and outside, as well as the continuous growth in demand for water from customers in Vietnam.

Thai Ambassador to Vietnam Nikorndej Balankura told local media that Thailand has become Vietnam’s largest trading partner in ASEAN with total trade volume of nearly $20 billion. Thai investments in Vietnam have also tripled to 735 projects with a total value of more than $14 billion, making it the ninth largest foreign investor in the country.

“Looking ahead, numerous promising prospects are expected in 2024 for Thailand and Vietnam as both sides join hands in paving way for the elevation of their relations to a new height of a “Comprehensive Strategic Partnership”, which will contribute to comprehensively strengthening and deepening bilateral relations as well as subregional and regional stability and prosperity,” he said.

Coal sector deploys many solutions to attract miners

Subsidiaries of Việt Nam National Coal-Mineral Industries Holding Corporation Limited (Vinacomin) have deployed many solutions such as applying science and technology to production, improving working conditions, increasing income and providing housing for miners, so that miners will stay with the coal industry.

Nguyễn Văn Nam, a 32-year-old miner, has worked at Vinacomin’s Thống Nhất Coal Company in Cẩm Phả District, in the northern-eastern province of Quảng Ninh for more than 10 years.

Nam said in the past, the company’s longwall mining was dug manually, but now the company installed a modern frame system which is much safer. Excavators, drills and winches were used for longwall mining now to increase productivity.

Thanks to that, the average income of the company's workers was more than VNĐ1 million (US$40) per day. It could reach VNĐ1.3-1.4 million ($52-56) each day if the miner worked on the weekend.

Nam said he earned about VNĐ500-600 million ($20,290-24,350) per year.

In 2010, he moved from the coastal central province of Nghệ An to the north-eastern province of Quảng Ninh to learn mining. After graduation, he was recruited by the company.

Currently, he is the team leader of a group of 32 miners.

Because of stable income, he already bought nearly 100 sqm of land to build a three-storey house where he, his wife and his children can live quite comfortably.

Thus, he encouraged his elder brother to work for the company and both of them were now exemplary faces of the company in terms of labour productivity.

Implementing the corporation’s policy (mechanisation, computerisation and automation), the company has decided to invest in a monorail system combined with diesel locomotives to serve mining production.

Nguyễn Mạnh Toán, director of the company told the Nhân Dân (The People) online newspaper that the company had poured a total VNĐ27.4 billion ($1.1 million) into increasing the production capacity in Lộ Trí coal mining area.

The company also put into use a diesel power station, providing backup power for equipment in case the grid power is suddenly cut.

All workshops of the company also run production-order software, reducing administrative procedures and improving efficiency in production management, he said.

The company was added to the top list of the corporation's coal mining companies with annual mining output reaching two million tonnes of raw coal.

In the meantime, Mạo Khê Coal Company in Đông Triều District, has reached an annual mining output of about 2.3 million tonnes in recent years, although it is an old mine having been in continuous exploitation for nearly 70 years.

Achieving the above results, the company's top strategy is innovation, application of science and technology, deployment of mechanisation and synchronous automation at all stages.

Director of the company Nguyễn Văn Tuân said Mạo Khê coal mine was classified as a mine, which contained much natural methane gas, always posing potential risks of fire and explosion.

Therefore, the company installed a modern centralised monitoring system to manage the gas 24 hours a day to ensure safe production.

Last year, the company had 10 miners earning more than VNĐ600 million ($24,500) each year, nearly 200 miners earning from VNĐ500 million ($20,400) to VNĐ600 million ($24,500) each year, and more than 400 miners earning from VNĐ400 million ($16,350) to VNĐ500 million ($20,400) each year.

Currently, the corporation has 50 companies located in Quảng Ninh Province, with a total of nearly 80,000 workers, including more than 51,000 migrant workers, so the need for stable accommodation is an increasingly urgent problem.

Since the 2000s, the companies have built 26 high-rise apartment buildings, providing accommodation for nearly 10,000 people.

In early October 2023, the corporation’s Trade Union coordinated with relevant units to advise miners to buy social housing apartments in an area in Hạ Long City.

After the consultation session, nearly 100 workers registered to buy the apartments, costing from VNĐ700 million ($28,600) to 1.2 billion ($49,000) per apartment, with an area of 40-70 sq.m.

The corporation’s Trade Union plans to organise many similar programmes to advise miners to buy social housing.

By 2025, the corporation will remove problems to build 10 social housing areas, covering more than 5 ha, providing accommodation for about 2,400 miners.

As calculated, Thống Nhất Coal Company has 3,500 workers, half of them in need of housing.

However, the company’s two dormitories now only accommodate nearly 700 workers.

Thus, the company is completing administrative procedures to build another accommodation complex in Cẩm Thành area. The complex is initially expected to have seven floors with 68 apartments, providing accommodation for 272 people, with a total investment of VNĐ73 billion ($2.98 million).

Chairman of the corporation’s Trade Union Lê Thanh Xuân said the corporation’s companies had made efforts to deploy a lot of solutions to improve working conditions, productivity and income for miners over the past time.

Additionally, the trade union also worked with relevant units to implement many welfare programmes every year for workers, such as building "Trade Union's Warm House" for disadvantaged and poor miners, and providing jobs for the wives of miners who suffered accidents or injuries during work.

It is estimated that the corporation needs to recruit and train about 4,000-4,500 candidates to supplement the number of workers who retired or quit their jobs because of hardship each year.

Phu Yen aims to become central coastal region’s blue economy hub

Phu Yen province plans to develop itself into a blue economy hub in the central coastal region  with digital economy, industry-green energy, high-quality tourism and services, high-tech agriculture and maritime transport and logistics as pillars, under the provincial master plan until 2030 with a vision to 2050.

According to the plan, approved by the Prime Minister in December last year, Phu Yen will become a developing locality towards modernisation and sustainability by 2030 and successfully realise the targets of digital transformation and business and investment climate improvement to become an attractive destination for major domestic enterprises and foreign investors.

Addressing the announcement ceremony on March 3, which saw the presence of National Assembly Chairman Vuong Dinh Hue, Deputy Prime Minister Tran Hong Ha said the master plan will open up opportunities and create more impetus for the province to further develop in the future.

He said the province must learn from the experience of other localities in the region and look for creative ways to realise its goals.

With huge potential for renewable energy, including wind and solar power, new forms of hydrogen energy and green ammonia, the province must have breakthrough solutions to attract investment in the fields of metallurgy, refining, petrochemicals and shipping, he noted.

The Deputy PM agreed with the orientation of making tourism a key economic sector and a driving force for socio-economic development, saying this is a great advantage of the province but creative ways are needed.

The province needs to link support services such as transport, accommodation, shopping and healthcare to create added value to tourism, and at the same time, tap the potential of cultural and natural heritage to develop green tourism, he said.

Regarding digital transformation in tourism, he suggested electronic payment for travel ticket, accommodation booking, cuisine and other services, and promoting natural and cultural beauties online.

As a coastal locality directly affected by climate change and sea level rise, it is essential for Phu Yen to integrate adaptation scenarios into plans as well as focusing on multi-purpose infrastructure systems, the Deputy PM said.

Also at the ceremony, the provincial leaders granted investment policy decisions/investment certificates to 14 investors with a total registered capital of nearly 10.5 trillion VND (426 million USD) and five memoranda on studying projects worth 128.8 trillion VND.

Gold exceeds VND81 million per tael again

The global gold price has reached a historic peak, causing domestic gold prices to continue to rise on the morning of March 6. SJC gold has once again reached the milestone of VND81 million per tael.

At approximately 9 a.m. in Ho Chi Minh City, Doji Group increased the SJC gold price by VND200,000 for both buying and selling compared to the previous day, reaching VND78.95 million per tael for purchases and VND80.95 million per tael for sales. Simultaneously, in Hanoi, SJC Company listed prices at VND79 million per tael for purchases and VND81.02 million per tael for sales, rising by VND200,000 for both buying and selling rates.

This morning, the price of 9999 gold rings continued to climb, reaching record highs for many listed companies. Specifically, in Ho Chi Minh City, SJC Company raised prices by VND50,000 for both buying and selling rates compared to the previous day, reaching VND66.6 million per tael for buying and VND67.8 million per tael for selling.

PNJ Company also increased prices by VND100,000 for buying and VND150,000 for selling, reaching VND66.6 million per tael for purchases and VND67.85 million per tael for sales. These prices mark the highest rates for 9999 gold rings from these two companies to date.

This morning, in Hanoi, Bao Tin Minh Chau Company set a record high for 9999 gold ring prices at VND67.43 million per tael for purchases and VND68.63 million per tael for sales. This is the company with the highest trading prices for 9999 gold rings in the current market.

In the global gold market, spot gold prices on the Kitco exchange reached a new peak on the morning of March 6 (Vietnam time), trading at US$2,125.6 an ounce, up $14 from yesterday morning. After conversion, this price translates to approximately VND63.7 million per tael, which is lower than the price of SJC gold by about VND17.3 million per tael and lower than the price of 9999 gold rings by approximately VND4 - 4.9 million per tael.

Gold prices have soared to historic highs as the market anticipates monetary policy easing by the Federal Reserve (FED) and central banks of major economies worldwide in June 2024. Analysts predict that with this expectation, gold could reach $2,300 an ounce in the second quarter of 2024. Furthermore, gold is increasingly valued as a safe-haven asset amid escalating conflicts in the Middle East.

Deep processing increases agricultural product export value: experts

As Vietnam aims for higher export value and new records in export turnover of key agricultural products in 2024, experts have called for greater commitment to deep processing, saying that this approach will not only boost product competitiveness but also create a professional industry chain and exceptional products that bring in higher value.

The pepper industry is a typical example. The Vietnam Pepper and Spice Association (VPSA) estimated a 10.5% year-on-year decrease in pepper production to 170,000 tonnes in 2024.

A favourable outlook was still anticipated for pepper exports this year due to reduced production and low inventory levels worldwide. However, the sector must attach importance to deep processing to increase export value. The current proportion of processed pepper products for export stands at a mere 30%, indicating the need for a significant improvement.

Despite the projected increase in pepper prices, pepper in the Central Highlands and Southeast regions has faced stiff competition from other crops, notably durian. This highlights the urgency for the industry to prioritise deep processing, not only to increase export value but also to provide farmers with peace in their mind amid fluctuating prices and market challenges, said VPSA President Hoang Thi Lien.

A representative of the Vietnam Coffee Cocoa Association (VICOFA) said that Vietnamese coffee is a sought-after product by importers. In June last year, for the first time in history, farmers had no coffee to sell. Currently, the inventory of this item has also decreased sharply, thus, the coffee prices are expected to reach new peaks in 2024.

From the perspective of a leading exporter to major markets, Phan Minh Thong, Chairman of the Board of Directors of Phuc Sinh Corporation, a Vietnamese pepper and coffee trader based in Ho Chi Minh City, highlighted the indispensable role of continued investment in deep processing for the sustainable development of Vietnam's coffee and black pepper sectors.

The seafood sector also recognised the importance of deep processing to enhance competitiveness, said industry insiders.

Kim Thu, a shrimp market expert at the Association of Seafood Exporters and Producers (VASEP), underlined the need for the Vietnamese shrimp industry to improve its competitive capacity by promoting processing to increase product value. Currently, value-added processed shrimp products contribute x40-45% to the total shrimp export value annually, she noted.

Dang Phuc Nguyen, General Secretary of the Vietnam Fruit and Vegetable Association (Vinafruit), said that to become a fruit and vegetable export powerhouse in Southeast Asia and the world, it is essential for Vietnam to improve several issues, including deep processing.

Only 25% of exported fruits and vegetables have been processed whereas it is up to 50% in countries with strong export potential in this regard.

According to him, thousands of businesses engage in processing in Vietnam but they operate on a small scale. Therefore, it is a must to prioritise investment in and have special mechanisms to encourage deep processing.

Australia forms $1.3 billion fund for investment with ASEAN

Australia on March 5 announced its plan to increase investment in the Association of Southeast Asian Nations (ASSEAN) by setting up a $1.3-billion finance package to boost trade and investment in the region.

The fund was announced by Australian Prime Minister Anthony Albanese at the three-day Special Summit commemorating the 50th anniversary of the ASEAN-Australia relations in Melbourne.

The fund will focus on clean energy and infrastructure and provide loans, guarantees, equity and insurance. Australia will also tip in an extra 140 million AUD (US$91.18 million) to extend an existing programme which advises the region on infrastructure projects.

Australia’s message is clear, the Australian Government leader said, stressing that more than any other regions, Southeast Asia is the future of Australia.

Besides major trade partner of China, Australia is looking to build economic relations with other partners. Meanwhile, fueled by years of rapid and sustained population growth, the ASEAN region is considered an emerging economic powerhouse.

In addition, Southeast Asia, a region with large reserves of important minerals and booming electricity demand, is also poised to play an important role in efforts to promote global clean energy.

Australia's new funding package will focus on exports, infrastructure and renewable energy projects. PM Albanese said this is "the most significant upgrade in Australia's economic commitment to ASEAN in a generation".

Climate change is a topic with a large presence on the agenda of the ASEAN-Australia commemoration summit. Southeast Asia's current "thirst" for energy is still mainly quenched by fossil fuels, while Australia is also one of the world's most polluting gas and thermal coal exporters. Therefore, both sides share a common desire to use renewable energy in the future. 

Tây Ninh to build new industrial park

Tây Ninh Province will have a new Hiệp Thạnh Industrial Park in Hiệp Thạnh Commune, Gò Dầu District.

Phase 1 of the investment project for the construction and usage of Hiệp Thạnh Industrial Park’s infrastructure was approved on March 1 by Deputy Prime Minister Lê Minh Khái through Decision 214/QĐ-TTg, with Vietnam Rubber Group – JSC (VRG) as the project investor.

The project spans across 495.17ha, not covering Xóm Bổ – Bàu Đồn Street, N8 Irrigation Canal, the planned Gò Dầu – Xa Mát Expressway, and the HCM City – Tây Ninh railway that passes through the project’s area.

Total investment for the project reaches VNĐ2.35 trillion (US$94.9 million), in which the investor will contribute VNĐ352.5 billion.

Lê Thanh Hưng, general director of VRG, said that the duration of the project’s operation is 50 years since the day the project’s investment was approved.

Tây Ninh People’s Committee will instruct the provincial Economic Zone Management Board to work with relevant authorities to help VRG divide the investment for the industrial park into multiple phases, in line with the quota for industrial park land in the 2021 – 2025 national land use plan (for Tây Ninh Province).

It is also to ensure efficiency in land usage and the progress of investment attraction into Hiệp Thạnh Industrial Park.

The province was instructed to carry out land reclamation and change land use to serve the project while building accommodation for workers in the industrial park.

VRG will contribute its portion of the project’s investment in accordance to its committed timeframe and follow regulations on land, environmental protection and other relevant laws.

Decision 214/QĐ-TTg also assigned the Commission for the Management of State Capital at Enterprises with overseeing how VRG mobilises and uses funding for the project.

The southern border province of Tây Ninh has five operating industrial parks, as well as the Mộc Bài border economic zone - a gateway for the province in developing trade with Cambodia.

As part of the Southern key economic zone, it has advantages in industrial production and tourism. Tây Ninh’s economy grew by around 5.5 per cent in 2023 to about VNĐ59.2 trillion.

It targets an economic growth of 7 per cent for 2024, and will focus this year on speeding up important traffic infrastructure projects such as the HCM City - Mộc Bài Expressway and the first phase of the Gò Dầu – Xa Mát Expressway (which spans from Gò Dầu to Tây Ninh City). 

New Hanoi-Melbourne air route to be launched in June

Vietnamese budget carrier VietJet Air will start operating a new air route linking Hanoi and Melbourne, in June.

The service was announced at the Australia-Vietnam Business Forum in Melbourne this morning, March 5, at the witness of Prime Minister Pham Minh Chinh and representatives from high-ranking officials of Australia and Vietnam. 

Chinh arrived in Melbourne on Monday to attend the ASEAN-Australia Summit and begin his official visit to Australia at the invitation of his Australian counterpart Anthony Albanese.

The Hanoi-Melbourne service will be launched on June 3 with two return flights per week. The flying time will be around 10 hours.

Flights from Hanoi to Melbourne will depart every Monday and Friday at 17:10 (local time), while those from Melbourne to Hanoi will depart every Tuesday and Saturday at 7:30 (local time).

Nguyen Thanh Hung, vice chairman of VietJet Air, said that the air route will help boost tourism as well as trade and business coo-operation between the two countries.

On the same day, Prime Minister Pham Minh Chinh attended a ceremony to mark the 30th anniversary of the opening of the Vietnam-Australia air route by national flag carrier Vietnam Airlines.

Vietnam Airlines is running 23 weekly flights on five routes including Hanoi/HCM City-Melbourne, Hanoi-HCM City-Sydney and HCM City-Perth.

Over the past 30 years, Vietnam Airlines has conducted 12,800 flights to Australia with six million passengers and 170,000 tonnes of cargo.

Prime Minister Pham Minh Chinh emphasised the significance of the aviation sector in the economic development. Vietnam wanted development and healthy competition of both state-owned and private airlines.

Chinh also proposed Australia help in aviation sector training, including pilots and managers.

Steel industry to see optimistic export prospects in year ahead

With positive signs recorded for steel exports in the first months of the year, the steel industry is anticipated to enjoy brighter export prospects this year, according to industry insiders.

The General Department of Vietnam Customs reported Vietnam exported 1.54 million tonnes of iron and steel between the beginning of the year and mid-February, raking in nearly US$1.1 billion in export earnings, up 65% volume and 66.2% in value.

Most notably, January alone saw iron and steel exports record impressive three-digit growth in several markets such as Italy (114%), the United States (419%), and Malaysia (625%).

The average export steel price in February rose by 0.6% to US$713 per tonne from the previous month, while two-month steel price declined by 1.7% to US$711 per tonne against the same period last year.

Industry insiders noted that the steel industry is projected to see a wealth of opportunities for breakthroughs this year thanks to favourable factors from export markets.

According to MB Securities Joint Stock Company (MBS), with the gradual rebound since the end of 2023, construction steel prices are forecast to increase by 6% to US$607 per tonne on average this year.

Most notably, the price difference between Vietnamese and Chinese steel currently stands at only US$30 per tonne, lower than the average of US$50 per tonne seen over the past two years, which is expected to help Vietnamese steel products not suffer any price competition pressure from Chinese rivals.

Over the medium term, when the real estate market enters a recovery cycle in 2025 as expected, construction steel prices will likely continue to increase by 8% to US$664 per tonne.

However, the Vietnam Steel Association pointed out that the steel industry is anticipated to face a number of challenges related to new policies enforced by China and the EU, along with issues on green transformation, emission reduction, and trade defense policies.

Local steel enterprises are therefore required to closely follow the consumption demand in export markets to proactively devise concrete plans moving forward.

Over the long term, they are advised to actively renovate technology, focus on green transformation and green production to reduce carbon emissions, and enhance management capacity over accounting systems in accordance with international standards in order to minimise the risk of trade defence measures.

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