Gold prices fell last weekend after remaining high for a week, and experts attributed the fall to the Government’s instruction on conducting a specialised inspection of the market.

Jewelry company Doji on May 12 lowered its quote for gold bullion by 1.7 million VND (66.79 USD) from the previous trade to 86- 87.5 million VND per tael (a tael equals 37.5 grams or 1.2 ounces) for bids and asks, respectively.

Bao Tin Minh Chau, another major gold trader, offered the precious metal for 87-89.2 million a tael.

Meanwhile, gold ring prices have not budged from the previous session, standing at around 75.95 – 77.45 million VND per tael at Doji, and 75.43 – 76.93 million VND at Bao Tin Minh Chau.

The prices of both bullion and rings steadied at State-owned Saigon Jewelry Company (SJC), at 88.8 – 91.3 million VND and 74.85 – 76.55million VND, respectively.

Earlier, the Government Office released a document on Deputy Prime Minister Le Minh Khai's conclusions at a recent meeting on the matter, one of which is his request for an urgent review and comprehensive assessment of gold bar production and trading by businesses, as well as gold market management solutions that the State Bank of Vietnam (SBV) adopted in recent times.

He also required further efforts to narrow the widening gap between domestic and international gold prices to ensure that the domestic gold market operates stably, effectively, healthily, openly, transparently, and in accordance with the law.

Attention should be paid to avoiding ‘goldenisation’ of the economy as well as the negative impact on macroeconomic stability and national financial and monetary security, Khai stressed, urging relevant agencies to report the results to the Prime Minister in May at the latest.

Experts said the domestic gold market would cool down at this sensitive period, yet the prices at home will be likely impacted by global prices that are returning to an upward trend due to the simultaneous decrease in the US dollar and US Treasury bond yields./.

US$12 billion gas-to-power project on right track, PM told Can Tho voters

All the signed contracts of the US$12 billion Block B - O Mon gas-to-power project are on the right track, said Prime Minister Pham Minh Chinh during his meeting with voters of the Mekong Delta city of Can Tho on May 12.

All the contracts have been signed, and everything is on schedule, said the PM who answered voters’ questions relating to the progress of the mega project.

The voters complained that the value chain project has been put on hold since 2010, impacting production and business activities of households whose land is affected by the project.

According to the Government leader, the first gas flows from Block B are expected to be transferred through the gas pipeline system to the mainland in 2026, and three gas-fired thermal power plants O Mon II, III, & IV are set to be put into operation in 2026, 2027, and 2028 respectively.

The Block B - O Mon gas-to-power project comprises three subprojects: Block B development project (upstream); Block B - O Mon pipeline project (midstream); and four gas-fired thermal power plants O Mon I, II, III, & IV (downstream).

O Mon I plant with a design capacity of 660MW was put into operation in 2009. It is using FO oil as the main fuel. It will switch to using gas when there is gas coming in from the Block B - O Mon gas pipeline project.

The gas exploitation output from Block B is expected to be about 5.06 billion m3/year, supplying a complex of the four power plants at O Mon Power Center, with a total estimated installed capacity of up to 3,800 MW.

HCM City to host 4th international electronics, smart appliances expo

The Việt Nam International Electronics and Smart Appliances Expo will be held in HCM City from May 23 to 25.

IEAE Vietnam will bring together 600 enterprises showcasing thousands of electrical and electronic products, household appliances, electronic components, lighting equipment, and other products.

With more than 800 booths, the expo’s fourth edition will be bigger than ever in terms of quality, product range and new exhibition experiences.

Speaking at a press conference on Thursday, Chris Wu of Chaoyu Expo, one of the event’s organisers, said: “After three successful exhibition seasons in Việt Nam, we expect this year to create many impressive activities and product experiences, helping buyers from everywhere have trust in laying the foundation for business cooperation.”

The goal is to entrench IEAE as a professional and influential B2B exhibition in the electronics and smart devices industry in Southeast Asia, he added.

Đỗ Thị Thúy Hương, executive board director of the Việt Nam Electronics Industries Association, said electronic products and AI-enabled smart devices are becoming increasingly popular with all users, not just the younger generations.

There will be five specialised seminars and a B2B matching programme at the expo to offer attendees diverse experiences.

Major brands in the electronics, retail and smart home appliances industries such as Panasonic, Mega Housewares, CCTV Camera, Green Cook, FPT, Fujifilm, Altech Computer, Mobifone, and VNG Vietnam have registered to participate and will work directly with suppliers at the exhibition.

The expo, to be held at the Saigon Exhibition and Convention Centre in District 7, will be jointly organised by VINEXAD. 

Vietjet opens direct flight between Hà Nội and Hiroshima

Vietjet has launched the direct route linking Hà Nội, Việt Nam's capital city with the captivating city of Hiroshima in Japan.

The new service marks the airline's eighth route between the two countries and the only direct air link between the two cities, significantly reducing travel time while providing a seamless travel experience between the two destinations, Vietjet said in a statement.

Speaking at the launching ceremony on Sunday, the Governor of Hiroshima Prefecture Yuzaki Hidehiko said:" Hiroshima Prefecture has close ties with Việt Nam, as many companies have advanced into the Vietnamese market and many Vietnamese people live in the prefecture.

"We are looking forward to the start of direct flights between Việt Nam and our prefecture, fostering further exchanges in business, tourism, and various other fields," he said.

President and Representative Director of Hiroshima International Airport, Yasuhiro Nakamura, said that Vietjet's debut flight today marks the first new international service to be launched at Hiroshima Airport post-pandemic.

"We extend appreciation for this milestone as it is a significant step in enhancing Hiroshima Airport's international network," the director said.

For his part, Vietjet's Vice President Nguyễn Đức Thịnh said Vietjet currently operates 116 flights weekly between major Vietnamese cities and Japan's top destinations, including Tokyo, Osaka, Fukuoka, Nagoya, and now Hiroshima.

He added that his airline is committed to further expanding the connectivity between Việt Nam and Japan, providing more travel options for citizens and tourists of both nations and across the regions.

The Hà Nội-Hiroshima route operates twice weekly return flights on Thursdays and Sundays with around four hours and 30 minutes per leg.

To celebrate the new route, Vietjet offers budget-friendly tickets starting from just zero dollars each way at www.vietjetair.com and the Vietjet Air mobile app

The promotional tickets (exclusive of taxes and fees) are applied to all Vietjet’s international routes. They are up for grabs every Friday, with the travel time to December 31, 2024 (exclusive of public holidays). 

SSC fines companies for information disclosure violations

The State Securities Commission (SSC) has recently issued numerous penalties against businesses for non-compliance with information disclosure requirements.

The authority imposed an administrative penalty on Saigon Glory Co Ltd, with headquarters on District 1, HCM City.

The company has been fined VNĐ92.5 million (US$3634) for failing to disclose required information as mandated by the law. 

Specifically, Saigon Glory did not provide information to the Hà Nội Stock Exchange (HNX) regarding its semi-annual financial report for 2023, the fulfillment of commitments related to the 2023 bond issuance and the utilisation of funds from the audited 2023 bond release.

It also failed to submit timely periodic information disclosures to HNX for the many 2021 financial documents.

Saigon Glory, a wholly-owned subsidiary of Bitexco Group, previously issued 10 separate bond lots worth VNĐ10 trillion to nearly 4,000 bondholders for The Spirit of Saigon project.

In October 2022, despite announcing its intention to repurchase all the bonds before maturity, Saigon Glory did not buy back any batches ahead of schedule, following the arrest of Vạn Thịnh Phát Group's leadership.

This February, the company negotiated with bondholders and reached an agreement to extend the maturity period to 1 - 2 years.

Recently, the SSC imposed an administrative penalty on Bình Dương General Printing JSC, located in Thủ Dầu Một City, Bình Dương Province.

It was fined VNĐ60 million for untimely information disclosure on the SSC's platform and HNX's electronic portal. The documents include the audited 2022 separate financial report and the 2022 annual report. 

Additionaly, the company was fined VNĐ15 million for failing to appoint a company administrator.

Similarly, the Inspectorate of the SSC has recently imposed an administrative penalty on Sovico Group JSC, located in Hoàn Kiếm District, Hà Nội. 

The company has been fined VNĐ92.5 million for the violation of not disclosing required information as mandated by the law.

Sovico failed to disclose information to HNX regarding the 2022 and semi-annual 2023 periodic reports on the utilisation of funds from bond issuance for audited outstanding bonds. 

It also did not timely disclose the 2021 and 2022 financial reports, the semi-annual 2022 financial report, the utilisation of funds from the 2020 bond issuance and the implementation of commitments to bondholders in 2022. 

Improving operational model critical to promote co-operatives

Improving the operation model of co-operatives is critical to promote the development of the collective economy and extend their reach to the global level, experts have said.

A report by the International Cooperative Alliance showed that the top 300 cooperatives in the world are operating in 27 countries with an estimated total revenue of US$2.409 trillion in 2021, 7.2 times higher than Việt Nam’s gross domestic product (GDP).

To date not one Vietnamese cooperative is on that list.

Under Resolution No. 20-NQ/TW Việt Nam wants to have 20 per cent of the population working in organisations within the collective economy by 2045.

In addition, Việt Nam aims to have at least three cooperatives in that list of 300 largest cooperatives in the world by then.

Võ Trí Thành, director of the Institute for Brand and Competitiveness Strategy, said that it is necessary to have a plan to promote the development of the collective economy and cooperatives in both quantity and quality.

Improving the operation model of cooperatives is an important factor, for efficiency and to contribute to economic growth, Thành said, adding that it was also critical to enhance the competitiveness and capacity of the cooperatives with a focus on talents.

According to Võ Kim Sa, Vice Principal of the School of Agriculture Management and Rural Development 2, cooperatives should operate on the basis of equality, fairness, solidarity and inclusion.

The success of cooperatives does not come only from revenue, tax payment or profit, but also from their social responsibility and sustainable development, Sa said.

For example, FrieslandCampina, a Dutch multinational dairy cooperative with 9,417 member dairy farms and 14,634 member dairy farmers, set goals for green growth through the reduction of greenhouse gas emissions in the raising of cows, in milk storage, processing and distribution and in packaging recycling.

Bùi Thị Nga from Việt Nam Academy of Agriculture said that sustainable development and social responsibility are parts of successful cooperatives in the world, which can be the glue that binds rural communities together.

Data from the General Statistics Office of Việt Nam showed that the collective economy and cooperatives are responsible for around 4 per cent of the country’s GDP.

There are around 31,000 cooperatives nationwide. Việt Nam aims to have 45,000 cooperatives by 2030.

Retail pricing conflicts set to persist

Businesses in areas such as retail and food and beverages are looking at different strategies to retain budget-conscious customers amidst the shrinking demand caused by the challenging economic environment.

FPT Retail recorded positive pre-tax profit in the first quarter of 2024. This is deemed a great relief to its leaders, who are still concerned about the tough lessons suffered by a price war beginning last year, and which eroded FPT Retail’s gross profits to 8 per cent in the second quarter of 2023 and 11 per cent for last year.

Speaking at its AGM, CEO Hoang Trung Kien said, “The price war amidst the electronics retail businesses selling mobile phones and laptops since March 2023 forced FPT Retail to close 30 stores last year. The price competition continues to linger this year, so the company plans to shut down another 50 inefficient stores.”

The price war was initially triggered by massive discounts from Mobile World Group (MWG) on TVs and household appliances. A slew of other retail chains like FPT Shop, CellphoneS, and Di Dong Viet then jumped on the bandwagon to offer discounts.

However, the strategy came with a price. Mobile World posted a net profit of $7 million in 2023, a decrease of 96 per cent on-year, marking the lowest level since 2013. The company’s stock has been removed from the VNDiamond index. Other investment funds have also reduced the proportion of MWG shares in their portfolios.

Recognising the impact of the price war, FPT Retail turned its focus on expanding its product lines, like venturing into household appliances. The company will scale up this segment with a view that household appliances will contribute 10 per cent to FPT Shop’s revenue in the future.

Meanwhile, at Masan Group’s AGM, the company’s leaders said that they are making efforts to change shoppers’ price perceptions through WinCommerce, which operates WinMart and WinMart+ supermarkets.

Since the end of 2023, WinCommerce has started to rebuild its strategy by mobilising staff to introduce product prices to customers and stepping up marketing across digital channels. In rural areas, WinCommerce has stocked some products at competitive prices with other grocery stores.

WinCommerce’s net revenue witnessed an 8.5 per cent on-year increase to $331.6 million in the first quarter of 2024.

As the economic outlook remains uncertain, price competition is extending beyond the retail space to the food and beverage sector. Amidst the dampening demand, coffee and fast-food chains like Highlands Coffee, KFC, and McDonald’s are further promoting affordable combos to target budget-conscious consumers.

Dao The Vinh, CEO of Golden Gate, said, “Every business must retain consumers. For our restaurant chains, the price war has turned into a value war, including customer care, service quality, and the customer experience.”

Likewise, Masan Consumer is focused on innovative products for the fast-moving consumer goods segment rather than pricing strategies to entice customers. It has rolled out a self-cook rice product into the market and aims to expand by entering the out-of-home market and providing premium products in home meal replacement and restaurant meal replacement.

“The company targets to expand the addressable market from $1 billion in instant noodles to $17 billion in restaurant meal replacement with the launch of the self-cooked rice product,” said Nguyen Truong Kim Phuong, senior marketing director of the convenience foods category at Masan Consumer. “Despite being more expensive than other instant noodle projects, we believe this product line will be successful, as we have experience premiumising the instant noodle experience.”

Vietnam charts vision for sustainable, modern fisheries

Vietnam aims to have a sustainable and modern fishery sector by 2050, with maritime and inland waters biodiversity preserved and local livelihoods improved.

Under a plan to transform the sector during the 2021-2030 period with a vision to 2050 recently signed by Deputy Prime Minister Tran Luu Quang, the country gives weight to protecting and developing aquatic resources, and targets to zone some 463,587 hectares, or 0.46% of the nation’s sea area, for the establishment of 27 protected marine areas by 2030.

Meanwhile, 149 marine areas and 119 inland sites will be designated to safeguard aquatic resources, breeding areas, and habitats for young aquatic animals.

As modernising fishing practices and restructuring the industry are also at the heart of the plan, a fleet of around 83,600 fishing vessels at the maximum will be developed and fishing activities adjusted, with trawling accounting for 10%, seine fishing 6.1%, gillnetting 40.3%, hook and line fishing 18.9%, among others.

The plan also lays an emphasis on consolidating and reforming fishery cooperatives and groups while encouraging them to produce in a value chain and pay due attention to increasing production value. Some 80% of the fishing vessels operating in coastal and offshore waters are envisaged to engage in a production chain by 2030.

By 2050, Vietnam expects to secure a sustainable and modern fishery sector comparable to other countries' in the region and the world, maritime and inland waters biodiversity conserved and developed, and the quality of people's material and spiritual life improved, helping ensure social security and protect the national sovereignty, security, order, and interests on river and at sea./.

Vietnam's vehicle sales down 11 per cent in first four months

According to a recent report from the Vietnam Automobile Manufacturers’ Association (VAMA), recorded sales of vehicles were down 11 per cent year-on-year to 82,515 units in the first four months of 2024.

A total of 59,116 passenger cars were sold out in the period, down 14 per cent on-year. Sales of commercial vehicles were down 3 per cent on-year to 22,730 units. Meanwhile, special-purpose vehicles declined by 28 per cent to 669 units.

Automakers also recorded a 17 per cent decrease in sales of completely knocked-down (CKD) vehicles in the first four months. Meanwhile, completely built-up vehicles (CBU) saw a drop of 3 per cent for the same period.

In April alone, auto sales grew by 9 per cent on-year to reach 24,350 units. However, this figure was 11 per cent lower than that of March. Among them, automakers reported deliveries of 17,258 passenger cars and 6,815 commercial vehicles, down 9 per cent and 15 per cent, respectively. Meanwhile, the number of special-purpose vehicles rose by 21 per cent to 277 units.

There were 11,983 CKD vehicles and 12,367 CBU units sold in April, down 17 per cent and 3 per cent from the previous month, respectively.

Last month, Prime Minister Pham Minh Chinh signed Directive No. 12/CT-TTg dated on key tasks to promote socioeconomic development. Accordingly, the Ministry of Finance was tasked with proposing a reduction in registration fees for domestically produced and assembled vehicles.

If approved, the policy will take effect from July 1 until the year-end. This will give a major boost to sales of domestically produced and assembled vehicle models. However, consumers are delaying their purchases to enjoy the preferential policy, which led to a decrease in auto sales in April, according to industry experts.

The Vietnam Motor Show 2024, which organised by the VAMA in collaboration with the Vehicle Importers Vietnam Association, is scheduled to take place in October. The show is an opportunity for car manufacturers to launch new products. Meanwhile, consumers are also expecting to buy the latest car model following this show. Vietnam's auto sales are expected to enjoy a rebound in the last months of the year.

Thai Nguyen shines among top performers in FDI

In light of Thai Nguyen’s socioeconomic development report in Q1, foreign investment attraction continues to garner inspiring results for the northern province.

The province enticed seven new foreign-invested projects, and three existing projects increased registered capital by $478 million, placing Thai Nguyen in the fourth place nationwide in foreign direct investment attraction in Q1. Cumulatively as of now, the province is home to 218 foreign ventures with a total registered capital reaching $11.2 billion.

In late February, Thai Nguyen Industrial Parks Management Authority approved a project on the production of monocrystalline silicon ingots, monocrystalline silicon panels, and solar energy panels for Trina Solar Cell Vietnam, a unit belonging to Chinese solar panel manufacturer Trina Solar, at Yen Binh Industrial Park (IP), with a total investment value surpassing $450 million.

This is the third project involving Trina Solar in Thai Nguyen, bringing its total investment in the province to $932 million. The project is slated to kick-off construction this month and commence operation from next spring, creating employment for more than 4,300 labourers.

Earlier, Trina Solar expedited two similar projects also at Yen Binh IP worth $478 million. Both projects are powered by high-tech and eco-friendly technology, aligned with the province’s investment attraction direction.

Last month, Nguyen Thanh Hai, Secretary of Thai Nguyen Party Committee, worked with a delegation from Japan’s Kawasaki city and Japanese investors led by Norio Aoki, mayor of the City Council, who visited to learn about investment opportunities in the province.

Hai expressed the desire to welcome more foreign investors, and Japanese ones in particular, to set up shop in the province and asserted the commitment to continue expediting preferential policies within the legal framework.

The province also wants to improve the quality of administrative reform and digital transformation, and grasp the difficulties facing investors and resolve them swiftly. The Japanese delegation also expressed the desire to invest in a number of fields, especially healthcare.

Trinh Viet Hung, Chairman of Thai Nguyen People’s Committee, noted that this year is of particular importance for localities in expediting and completing economic growth targets in the context the economy is forecast to gain rebound momentum.

Of note, Thai Nguyen is the fifth locality nationwide in which the prime minister approved provincial planning for the rest of the decade and with a vision towards 2050, which regulates the planning of 12 IZs and over 40 industrial clusters with a total area surpassing 6,300 hectares.

Le Quang Tien, Vice Chairman of Thai Nguyen People’s Committee, said, “To further improve the local investment climate, the province has established a task force in charge of helping businesses and investors swiftly remove issues when implementing projects in the area, as well as organising monthly dialogue meetings with businesses and investors to facilitate production and business activities.”

Thai Nguyen ranked second nationwide in the satisfaction index of individuals and businesses in public administrative services in the Vietnam Provincial Governance and Public Administration Performance Index for 2023. The results were unveiled last month.

Chairman Hung believes the province renders multiple opportunities to attract foreign investment, particularly the fresh planning scheme for the rest of this decade would be the premise for the province to open up new development and investment space.

“Therefore, strengthening and innovating investment promotion activities, especially foreign investment promotion, will help the province best avail of the opportunities, increasing cooperation with global investors, contributing to propelling the province’s socioeconomic development quickly and sustainably,” said Hung.

Meanwhile, Le Kim Phuc, director of Thai Nguyen Industrial Parks Management Authority, noted that Thai Nguyen commits to taking specific actions to best support investors. “Top priority shall be given to high-tech, electronics, and semiconductor projects, and projects that create high added value and embrace modern and effective governance, having spillover effects and connecting global production and supply chains,” said Phuc. “Quality, technological efficiency, and environmental resource protection are Thai Nguyen’s main evaluation criteria in investment attraction.”

Hyosung plans data centre in Ho Chi Minh City

South Korean industrial conglomerate Hyosung Corporation has expressed its intention to build a data centre in Saigon Hi-Tech Park (SHTP).

The information was shared by Lee Sang Woon, co-vice chairman and COO of Hyosung Corporation, at a meeting with Deputy Prime Minister Le Minh Khai on May 10.

Accordingly, Hyosung plans to build a data centre in SHTP to tap into the growing demand for digital infrastructure in the region.

Vietnam is currently home to 32 small- and medium-sized data centres. Among them, there are four major local suppliers, namely Viettel, VNPT, FPT, and CMC, which account for 97 per cent of the market share.

Vietnam's data centre market remains smaller than that of regional peers like Singapore, Indonesia, Malaysia, Thailand, and the Philippines.

However, Vietnam is one of the world's ten largest emerging data centre markets. According to Research and Markets, the data centre market in Vietnam is forecast to reach $1 billion by 2028, with a compound annual growth rate of nearly 11 per cent.

At the meeting, Woon added that Hyosung, the world's third-largest ATM manufacturer, is looking to invest in a factory manufacturing ATMs in Vietnam.

In response, DPM Khai said the government is focused on improving the investment climate and creating stronger conditions for the groups.

He proposed that Hyosung pay attention to protecting the environment, enhancing linkages with local companies, using locally-made materials, and ensuring employee welfare.

Vietnam has attracted 10,000 projects from South Korean companies, with total registered capital of $87 billion. Among them, Hyosung is the third-largest South Korean investor in Vietnam, trailing behind Samsung and LG. Since 2007, the corporation has invested $4 billion in Vietnam, including in raw materials, textiles, chemicals, and industrial electrical systems. Most of the corporation's South Korean-based factories have been relocated to Vietnam.

In March, Hyosung TNC also received investment approval for the Hyosung BDO project from Ba Ria-Vung Tau People's Committee to build the largest bio-spandex factory in Vietnam.

Delays in Nhon Trach power plants cause VND13 billion damage daily

Delays in the construction of Nhon Trach 3 and 4 power plants will cause damage of VND13 billion (over $541,000) per day for the investor PV Power.

On May 9, the State Steering Committee for Important National and Key Energy Projects led by Minister of Industry and Trade Nguyen Hong Dien worked at the construction site of Nhon Trach 3 and 4 power plants in Nhon Trach district of the southern province of Dong Nai. These two projects have a total capital of $1.4 billion and a total capacity of 1,624 MW.

If everything proceeds according to the plan, Nhon Trach 3 will be finished and will be able to generate commercial power in November 2004, whilst Nhon Trach 4 will follow suit in May 2025.

However, as of April, the workload is only 85 per cent complete. This means that the construction process of Nhon Trach 3 is delayed for six months compared to the deadline due to barriers in land clearance. Meanwhile, the delay of Nhon Trach 3 will lead to delays in the Nhon Trach 4 deadline.

The investor reported to the State Steering Committee that the total area having clear ground relating to the land of Ong Keo Industrial Park was 30.7 hectares, and there are barriers relating to land hiring fees.

Project Management Board leaders have said that one issue that has to be settled promptly is the power purchase agreements (PPA) contract between Vietnam Electricity (EVN) and PV Power.

The next steps are committing to a long-term power purchase and figuring out the pricing range for liquefied natural gas power generation. These represent the most crucial elements required for the projects to be implemented successfully.

Another noteworthy problem is the disagreement between the Project Management Board and the land leasing entity, Tin Nghia Group.

Before the Lunar New Year, PV Power issued a document stamped as urgent and sent it to Deputy Prime Minister Tran Hong Ha and relevant authorities, stating that Tin Nghia Group, the organisation in charge of overseeing Ong Keo Industrial Park, had obstructed the construction of the cooling water discharge channel at the park's intersection with Road No. 4.

PV Power submitted the proposals to look for solutions for these two projects. The investor estimates that a delay in the construction of these two projects will cause damage to over $541,000 per day for parties, including Dong Nai People’s Committee.

“These two projects are national key projects, which play a crucial role in ensuring energy security for the country. Thus, the province and the investor need closer collaboration to resolve the pending issues and to accelerate the projects,” said Minister Dien.

Ho Chi Minh City lures $900 million in FDI in first four months

In the first four months of 2024, a total of $915.6 million in foreign direct investment (FDI) capital flowed into Ho Chi Minh City, down 6.5 per cent against the same period last year.

According to the latest report by Ho Chi Minh City Department of Planning and Investment, 652 foreign investors increased their capital contributions and share purchases totalling $713.5 million, down 5.6 per cent in deal count but up 68.3 per cent in deal value against the same period last year.

South Korea and Singapore accounted for the largest proportion of capital contributions and share purchases at 40.9 per cent and 33.9 per cent, respectively.

The report pointed out that 357 new projects were granted investment certificates in the given period, up 16.3 per cent from a year earlier. However, their total investment only reached $129 million, down 24.3 per cent on-year.

FDI inflows into the city in the first four months mainly came from capital contributions and share purchases, as the city lacks land to attract large investment projects.

For instance, in Saigon High-Tech Park, land reserved for attracting projects in the fields of electronics, microchips, and semiconductors only had an area of 0.5–3 hectares per project.

A domestic enterprise authorised by US investors has recently proposed that Ho Chi Minh City People's Committee establish an Innovation Technology Park covering 350-400ha specialising in chip production and testing.

However, with limited land, it will be difficult to fulfill investor demands.

Vietnam and UK deepen science, technology and innovation partnerships

Vietnam and the United Kingdom are set deepen science, technology, and innovation (ST&I) partnerships, with a focus on emerging technologies, the environment, and healthcare.

The UK-Vietnam ST&I partnership began in 2014 with the arrival of the Newton Fund and the Global Challenges Research Fund. Since then, 50 joint research projects have been supported by the Newton Fund, and the UK ranked ninth in the list of Vietnam’s international co-publishers between 2017-2022. Joint publications have mainly focussed on medicine, engineering and physics.

UK-Vietnam's current ST&I priorities are emerging technologies (mostly AI), climate and environment, global health, and institutional capacity building in governance and responsible development and adoption of technology.

In 2023, Vietnam became a partner country to the UK’s International Science Partnership Fund, which is now the main instrument to deepen UK-Vietnam ST&I partnerships.

The UK’s Science and Innovation Network (SIN) works closely with Vietnamese government partners, funding agencies and academics in country to identify collaboration opportunities of mutual interest and complementary capability.

SIN Vietnam mobilises various science diplomacy channels and funds to materialise them, and works closely with the UK’s Department for Business and Trade to realise commercial benefits and incorporate industry engagement where appropriate.

Examples of recent UK-Vietnam collaboration include a workshop on responsible AI governance organised in the margin of Vietnam’s AI Day, and a workshop to establish a UK-Vietnam network to drive innovation in healthcare.

Vietnam is currently 46th in the Global Innovation Index 2023. It ranks second among the 37 lower-middle-income group economies.

The number of international publications from the country tripled between 2017 and 2022. The top five disciplines in international publications are engineering, computer science, mathematics, environmental science and medicine.

In 2021, Vietnam’s gross domestic expenditure on research and development (GERD) was 0.42 per cent of GDP. There was a sharp increase in R&D investment from the private sector from 12 per cent in 2015 to 43.84 per cent in 2021.

Vietnam’s National Strategy for ST&I Development (2021-2030) aims to increase the GERD to 1.5 per cent by 2030.

ACV secures $1.8 billion in syndicated loans for Long Thanh Airport, ensuring on-schedule completion by 2026

Airports Corporation of Vietnam (ACV) has secured a $1.8 billion loan from three state-owned banks over a 20-year term to finance the construction of Long Thanh International Airport.

ACV has confirmed that under a board-approved resolution signed by chairman Lai Xuan Thanh on May 6, Vietcombank, VietinBank, and BIDV will extend a syndicated loan of $1.8 billion to finance Component 3 of the Long Thanh International Airport project.

The credit agreements were executed with Vietcombank, acting as the lead bank and asset management agent, alongside VietinBank and BIDV, who are participating as co-lenders. This funding aims to cover legitimate financing needs associated with the project's investment, with a repayment term from these state-owned banks set at 20 years. Security for the loan includes assets arising from the project, covering both existing and prospective collaterals.

Phase 1 of Long Thanh International Airport is projected to require an overall investment of about VND110 trillion (over $4.6 billion), which includes four component projects. Component 3, managed by ACV, involves critical airport infrastructure.

Thanh of ACV noted, "Despite three challenging pandemic years, the company maintained stable revenue and profits, aided by facilitated debt rescheduling."

ACV has also adjusted its foreign currency borrowing strategy. Originally intending to secure $2.1 billion, the company recalibrated its funding plans, reducing its foreign debt intake to between $1.7 and $1.8 billion.

Thanh affirmed ACV's confidence in its financing strategy, mentioning additional borrowing capacity if needed. He reassured stakeholders that the Long Thanh Airport project would proceed as planned, with operational commencement targeted for Q4 2026.

Cai Mep LNG Terminal to start commercial operations in September 2024

AG&P LNG, a subsidiary of Nebula Energy, along with its partner, Hai Linh Co., Ltd., a prominent petroleum product import terminal and trader, have announced the start of the commissioning of Cai Mep LNG Terminal.

The detailed milestones of the commissioning phase will lead up to the start of the terminal's commercial operations in September 2024. The information was revealed at the Cai Mep LNG Terminal Commissioning Symposium on May 8.

Karthik Sathyamoorthy, CEO of AG&P LNG, said, "I am thrilled to announce the start of the commissioning of Cap Mep LNG Terminal. We are now also on track to start the commercial operations of the terminal in September 2024. The hard work and can-do spirit of the team from Hai Linh, AG&P LNG, and Nebula Energy to meet our commitment of LNG delivery by Q3 2024 has been nothing short of extraordinary."

"At our Cai Mep LNG Terminal Commissioning Symposium, we signed our second definitive LNG offtake agreement with one of the demand aggregators in Vietnam. We signed our first definitive agreement for one million tonnes per annum (MTPA) offtake with HPP power plant earlier this year in March. Very soon, we will be able to provide reliable LNG supply and immediately serve power and nearby industrial customers," added Sathyamoorthy.

AG&P LNG has six additional executed letters of intent with six more demand aggregators for downstream LNG distribution since it acquired 49 per cent stake in the terminal in March this year. Cai Mep LNG Terminal is connected to the nearby Phu My Industrial Park and has pipeline connectivity to Vietnam's largest power generation complex, Phu My, which has gas-fired capacity of 3.9GW.

The terminal is strategically located near the Mekong River Delta and has 220,000 cubic metres of LNG storage, along with LNG break-bulk capabilities that allows it to reload LNG into smaller vessels. Cai Mep Terminal will be initially set at 3 MTPA and expandable to 6 MTPA, with 14 truck-loading bays for LNG and CNG filling.

Le Van Tam, CEO of Hai Linh Co., Ltd., said, "I am excited to announce the commissioning of our Cai Mep LNG Terminal. We at Hai Linh are privileged to have AG&P LNG and Nebula Energy as our partners as we work towards unlocking the potential LNG demand across multiple sectors and help reinforce energy security in the country."

Earlier this week, Cai Mep LNG launched an expression of interest for supplying commissioning LNG cargo to the terminal. The tender for the commissioning cargo is to be issued in early June and awarded by the end of that month.

Climate tech startups grab unique opening

Vietnam’s climate tech startups have garnered significant interest from venture capital funds, with their potential to contribute to Vietnam’s commitment to achieve net-zero emissions by 2050.

At a farm in the central province of Khanh Hoa, solar panels and sand batteries are combined to store thermal energy for drying mangoes and herbs. By using photovoltaic panels and sand batteries instead of grid electricity, the farm can ensure a stable heat source unaffected by weather conditions and enable continuous drying capacity.

Na Nguyen, founder of Ecovi Farm, estimates that this carbon-neutral drying system helps her farm significantly reduce electricity costs of approximately $300-350 each and every month. Therefore, her farm can produce processed agricultural products at much more competitive prices while also contributing to sustainable development.

The thermal energy storage solution utilising sand battery technology was developed by the Vietnamese startup Alternō. This solution, tailored for agricultural applications across drying, warming, or heating needs, is a typical example of a climate tech startup in Vietnam.

Hai Ho, co-founder and chief commercial of Alternō, told VIR, “Alternō is committed to driving significant reductions in carbon emissions by focusing on sectors crucial for sustainable development–agriculture, industry, and residential heating. Our innovative thermal energy solutions, such as the Alternō Air and Alternō One systems, are designed to replace less efficient and more polluting traditional methods, offering both environmental and economic benefits.”

By enhancing the sustainability of essential processes through advanced technology, Alternō aims not only to lead the market in thermal energy storage, but also to set new standards in how businesses and homes manage and utilise energy in a climate-conscious era.

Thanks to the innovative solution, Alternō has successfully wrapped up over $1.5 million in an oversubscribed funding round co-led by leading impact VC funds The Radical Fund (Singapore) and Touchstone Partners (Vietnam) at the beginning of April.

Alternō is the latest climate tech startup receiving funding in the Vietnamese market. Previously, Touchstone Partners, a pioneering climate VC, invested in Selex Motors’ electric motorbike ecosystem in 2021, Forte Biotech in agritech in 2022, and digital energy-platform Stride in early 2023.

Another climate tech startup, electric vehicle (EV) group Dat Bike, has raised $16.5 million over three rounds from VC funds like Jungle Ventures, GSR Ventures, and Wavemaker Partners.

According to a report by Golden Gate Ventures and Venture East, climate tech encompasses a set of sectors that tackle the challenge of decarbonising the global economy, aiming to reach net-zero emissions.

The market size for climate technology in India and Southeast Asia in 2023 was $102 billion and is expected to grow to $350 billion by 2030, at a compound annual growth rate of around 20 per cent. Over $70 billion was invested in climate technology globally in 2022, with Southeast Asia and India accounting for approximately 7 per cent of it.

Meanwhile, data compiled by DealStreetAsia reveals that Vietnam accounts for 5.3 per cent of climate tech funding value in Southeast Asia since 2022, which places the country in the top three countries. Singapore ranks first at 80.4 per cent, followed by Indonesia at 13.1 per cent.

Vietnam’s climate tech startups are on the radar of VC funds thanks to their potential to contribute to advancing Vietnam’s net-zero roadmap.

Tu Ngo, general partner of Touchstone Partners, said, “When we started Touchstone in 2021 with the underpinning thesis of investing in big opportunities that impact Vietnamese people’s lives, climate was always an important landscape we operated in. We invested in climate solutions in Vietnam before attention came to this space, and hence have inadvertently become the most active VC in climate in Vietnam.”

“When we invest in climate tech startups, we look at how breakthrough and unique the technology will be in the market in the next 5-10 years. We ask the question: when this startup succeeds, in a world where Vietnam transitions towards net-zero goals, will they be one of the market leaders in a major climate vertical, namely energy, transportation, industrials, agriculture, and urban life?”

For instance, the fund believes that Selex will be a significant company given that more than 50 million motorbikes in Vietnam can transition into EVs in the next 10 years.

“We see the vision where all of these pieces are helping Vietnam get closer and closer to our net-zero goal. Ultimately, as climate change will disrupt a lot of our economy and our way of life, we take the long-term view and want to discover and nurture breakthrough firms that can take the chance and lead the green economy in the next 10 years,” Ngo said.

In the same vein, Vinnie Lauria, managing partner of Golden Gate Ventures, said, “Vietnam is going to shine against the backdrop of global economic challenges and will keep rising in the startup golden triangle of Vietnam, Singapore, and Indonesia. Climate technology will emerge as another big bet, with the climate discussion becoming much more ubiquitous and organisations facing greater environmental, social, and governance pressures.”

Following on from Vietnam’s net-zero commitments and national green growth strategy, climate tech startups offering innovative solutions to offset greenhouse emissions, ranging from EVs to battery tech and agritech, have enormous potential to thrive in Vietnam.

“Climate tech startups like EQUO are essential to helping drive innovation and solutions for Vietnam. We know that while consumer behaviour will ultimately drive change, the onus is on brands and businesses to provide these solutions for them,” said Marina Tran-Vu, founder and CEO of EQUO.

To foster a thriving climate tech ecosystem, she suggested that Vietnam could implement supportive policies that incentivise the adoption of sustainable tech.

“In addition, establishing grants is crucial for climate tech startups to innovate and scale their solutions. Finally, leading by example, the government could integrate these technologies into state-funded projects and promote their enhancing public awareness and trust in these innovations,” she added.

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