Deputy Minister of Transport Nguyen Xuan Sang has signed a decision approving a project to build a merchant fleet capable of handling a fifth of the country's imports and exports by 2030.
The main goal of the project is to build a fleet of container ships for the Asia-Pacific region to gain operational experience and set a foundation for long-distance routes.
In addition, Vietnamese maritime authorities will improve their management capacity, create a clear and transparent legal framework, promote science and technology application, and reform administrative procedures to support enterprises.
The project also aims to double the volume of import and export cargo transported through domestic seaports by Vietnamese ships to 10% by 2026 and 20% by 2030.
A report by the Vietnam Maritime Administration (VinaMarine) shows that along with an average annual growth of 12% import-export from 2016-2021, the cargo throughput of the country's seaports saw a stable increase in the period. In the first seven months of this year, the throughput growth slowed but still showed a year-on-year rise of 2%, reaching about 63 million tonnes.
The country's ports in recent years have been developed and are now able to accommodate the world's largest ships. The country's merchant fleet ranks third among ASEAN nations and 28th in the world.
Vietnam strives to boost green agriculture development
The country is in the process of further promoting green agriculture development amid the growing demand for safe products for health and the environment.
According to Minister of Agriculture and Rural Development Le Minh Hoan, Vietnamese agriculture sector has seen strong and comprehensive development, and tremendous achievements in recent years, with the food output increasing rapidly in both quantity and quality, ensuring the needs of domestic consumption and export.
To effectively deal with challenges related to the shrinking of cultivation land, the increasing demand for food, the excessive use of inorganic fertilizers and chemical pesticides in agricultural production, and post-harvest losses, numerous solutions have been devised.
Agriculture needs to have harmony in each production link, towards ensuring sustainable growth goals, protecting the environment, and adapting to climate change, Hoan went on to say.
Bui Ba Bong, former Deputy Minister of Agriculture and Rural Development, the agricultural sector sets a goal of reducing greenhouse gas emissions - one of the important criteria for environmental protection.
In line with this, greater attention must be paid to ensuring green agricultural materials for production, he stated.
He also highlighted the significance of building mechanisms and policies on green agriculture, towards further spurring the development of agricultural production models meeting organic standards, and ecological agriculture models in order to produce quality and safe products.
The Ministry of Agriculture and Rural Development has adopted an action plan to implement the National Strategy on Green Growth from 2021-2030.
Under the plan, the ministry will step up greater efforts to develop the agricultural sector in an ecological, organic, circular and low-carbon direction to improve growth quality, added value, competitiveness and sustainable development, while reducing pollution in agricultural production and in rural areas, and promoting energy efficiency towards carbon neutralisation by 2050.
It is set to increase the use of organic fertilisers to 30% of all those consumed, along with 30% of pesticides and at least 30% of farm areas using water-saving systems.
The agricultural sector will also take a score of measures to encourage green consumption.
It will mobilise social resources, especially those from businesses, while calling for financial support and technology transfer through international cooperation activities in a bid to ensure resources for green growth moving forward.
Japanese retailer AEON to expand operations in Vietnam
Leading Japanese retail group AEON has unveiled plans to triple the number of its shopping malls nationwide to 16 between now and 2025 in an attempt to gain an advantage in the food sector, reported Japanese news service Nikkei Asia.
The news outlet noted that with almost 40 years of experience in Southeast Asia, the retailer will seek to use the knowledge it acquired in Malaysia, where it first entered the region, and other markets to intensify its store opening campaign.
The giant retail group is greatly attracted to the growing Vietnamese middle class as consumers, especially amid the lifting of restrictions placed on foreign operators.
AEON has so far opened some 200 stores in Vietnam, including six shopping malls and several supermarkets. The stores are primarily located in Ho Chi Minh City, the country's largest city, and Hanoi, the capital, although a mall is set to open in the central city of Hue in 2024.
The Japanese firm has devised plans to increase its number of stores in Hanoi to 100 by 2025, approximately 10 times the current number. In addition, the number of malls will also be nearly tripled to 16 throughout the country.
HCMC attracts US$400m in venture capital in Jan-Sept
HCMC had lured 22 venture capital deals amounting to US$400 million in the year to September, according to data released at the launch ceremony of the HCMC Innovation, Startup and Entrepreneurship Week (WHISE) yesterday, October 13.
The city accounted for 50% of the country’s total number of venture capital deals in the first nine months.
Nguyen Viet Dung, director of the HCMC Department of Science and Technology, said that innovation startups in the city are highly evaluated by international investors. Some startups have business models with high growth potential and have applied new technology.
According to a report recently issued by the global startup ecosystem map and research center StartupBlink, HCMC continued to rise to 179th place in startup innovation.
The leading role of HCMC helped the Vietnam startup ecosystem inch up five notches year-on-year to 54th globally this year. The country also ranks fifth for startups in Southeast Asia.
HCMC manufacturing sector rebounds
HCMC saw its industrial production index (IPI) in January-September increasing by 19.6% compared to the same period last year.
The HCMC Department of Industry and Trade said the city’s post-pandemic industrial output has recovered despite a global consumption fall and a material supply shortage.
In September, the city’s IPI rose by 1% versus August, but up 89.6% year-on-year.
The vibrant growth of key industries, namely mechanical and automation, electronic and information technology, chemical products and food processing, is expected to fuel overall industrial production in the rest of the year.
The city’s export revenue in September reached US$64.6 billion, rising by 22.8% compared to the same period last year.
The city’s January-September exports brought roughly US$40 billion, up 13.8% year-on-year, while its import bill hit US$48.8 billion, up 10.3%.
Some 223 wet markets, three wholesale markets, 236 supermarkets and 45 shopping centers have reopened since the lifting of Covid social distancing in October last year.
However, global supply disruptions, runaway inflation and falling world consumption still pose challenges to Vietnamese businesses for the rest of the year.
Hanoi considers new airport-urban area metro line
Hanoi People's Committee has just asked the city's Urban Railway Management Board to study the sixth urban metro project connecting Noi Bai Airport with a new urban area in the western district of Thanh Tri's Ngoc Hoi Commune.
Under the committee's plan, the new Noi Bai-Ngoc Hoi metro line would include 43 kilometres of track with 29 stations, running through the districts of Soc Son, Me Linh, Thanh Tri, Dong Anh, Hoai Duc, Bac Tu Liem, Nam Tu Liem, and Ha Dong. The project will use non-refundable ODA from the Australian government through the World Bank.
Relevant units have been asked to propose investment modes to the Hanoi Urban Railway Management Board, which would work with the World Bank to resolve funding for the project.
Hanoi’s metro plans until 2030 include eight metro lines running for 318 kilometres. The city hopes to have between 35-45 percent of the population using public transportation while the number of people using private vehicles falling to 30 percent.
So far, only the Cat Linh-Ha Dong line has been completed and has been put into operation early this year after 10 years of construction.
The other lines are still in different phases of development. The Nhon-Hanoi Station line is set to have its elevated section operating at the end of 2022, but the entire line will only enter operation in 2027.
Vietnam steel industry to grapple with falling demand
Domestic steel demand have plunged, leading producers to sit on huge inventories.
Output of finished steel products totaled over 2.4 million tons in September, down 23.41% against August and up 1.7% year-on-year, the Vietnam Steel Association (VSA) reported. Of the total, steel sales were around two million tons, down 7.19% over the previous month and 9.9% versus the same period last year.
Meanwhile, construction steel output rose to 1.1 million tons, up nearly 12% over August and 47.2% year-on-year. However, sales took a nosedive, at around 920,000 tons, down 21.91% versus August, while exports plunged 47.9% against the year-earlier period.
According to VSA, the industry outlook improved in late August. Still, steel manufacturers were at risk of huge losses due to the a decline in domestic demand for steel and a plunge in exports.
At the end of the second quarter, inventories of 15 leading steelmakers accounted for 95% of the stocks of the whole industry, with 10 of them reporting unsold goods worth over VND1 trillion.
Dragon Capital becomes major shareholder of Vinh Hoan
Dragon Capital has raised its ownership in Vinh Hoan Corporation, a listed company, to 5.06% from 4.9%.
Norges Bank, a member of Dragon Capital, on October 11 bought 150,000 VHC shares, while two other members, CTBC Vietnam Equity Fund and Samsung Vietnam Securities Master Investment Trust, acquired 100,000 VHC shares and 50,000 shares on the same day, respectively.
The share acquisition made Dragon Capital a major shareholder of Vinh Hoan, whose shares are traded on the Hochiminh Stock Exchange under the code VHC.
In the second quarter of this year, Vinh Hoan booked over VND4.2 trillion in revenue, up 80.4% year-on-year, and VND788 billion in after-tax profit, up 203% against the year-ago period.
This year, the local company targets VND13 trillion in revenue, up 43.6% versus the year earlier, and VND1.6 trillion in after-tax profit, up 45.6%.
Black pepper export volume down
Vietnam’s black pepper export volume tumbled in September, according to the Import-Export Department under the Ministry of Industry and Trade.
In the first nine months of the year, the country shipped abroad 174,530 tons of black pepper worth US$770.44 million, down 18% in volume but up 7.1% in value year-over-year.
Exports of black pepper to key markets such as the U.S., Germany and the Middle East fell last month.
The decline in black pepper export is forecast to continue because of the continued fall in consumption in the major markets that are struggling with runaway inflation and the rise of the U.S. dollar.
According to the Ministry of Agriculture and Rural Development, the total output of black pepper in 2022 is expected to decline 10% over last year at 175,000 tons.
JICA to boost support for Vietnam to develop workforce
The Japan International Cooperation Agency (JICA) will support Vietnam in improving its workforce via multiple projects as the country is facing a shortfall of skilled labor, said Shimizu Akira, chief of JICA Vietnam.
Vietnam has been attractive to FDI thanks to its hardworking workers. The demand for diversifying supply chains due to trade conflicts between the U.S. and China and the Covid-19 pandemic has driven the investment shift to Vietnam, Akira said during a press conference in Hanoi on October 12.
However, Vietnam will gradually lose its labor advantages, resulting from the aging population in the next 30 years, the limitations of the current cheap labor force and low labor productivity.
Due to the above reasons, Vietnam needs to promptly develop its workforce to accommodate the rising labor demands in the years to come.
JICA will continue supporting Vietnam through technical cooperation and loan assistance to help the Vietnam – Japan University establish a post-graduate program and a new educational facility in Hoa Lac as of 2023, with the ambition to turn this university into a comprehensive one with 6,000 students.
Besides, JICA will boost career connectivity for interns to practice and improve their working skills. The project aims to create a better work environment for Vietnamese laborers in Japan by linking the Vietnamese workforce with Japanese businesses, simultaneously eliminating illegal career brokerage.
In parallel with the above projects, in the sector of skilled labor training, JICA is mapping out a plan with the Vietnamese Government to give financial support via ODA to 13 career training schools. At the beginning of the project, Japanese experts will come to Vietnam to offer support, guidance, training and transfer training skills to Vietnamese.
In addition, JICA will support Vietnam increase its localization rate, which is expected to make the country more appealing to foreign investors for the global expansion of supply chain trends post-pandemic.
In the past years, JICA has implemented many projects in Vietnam, such as providing ODA loans for the metro project in HCMC, connecting the Ben Thanh market with the Suoi Tien Theme Park, or giving financial assistance to a private developer of an onshore wind farm in Quang Tri.
Trade turnover hits over US$557 billion in nine months
Viet Nam's trade with the rest of the world totalled US$557.93 billion in the first nine months of 2022, including US$ 387.77 billion contributed by the FDI sector, according to the General Department of Viet Nam Customs.
In the second half of September, trade volume was US$31.76 billion, representing an increase of 20.6 percent or US$ 5.42 billion in comparison with the first half of the month.
From January through September, trade turnover grew 15 percent (equivalent to US$ 72.7 billion) against the same period last year.
Total trade turnover of the FDI sector valued at US$ 387.77 billion, up 15.2 percent against the same period last year. The domestic sector gained a trade turnover of US$ 179.16 billion, representing a year-on-year increase of 14.4 percent.
The trade surplus of US$ 2.44 billion in the second half of September brought the total figure to US$ 6.76 billion in the first nine months of the year.
In January-Sptember period, export turnover valued US$282.35 billion, posting a year-on-year increase of 17.2 percent, equivalent to US$41.46 billion in comparison with the same period last year.
IFC invests in SeABank to support SMEs
In the context of tight credit, International Finance Corporation (IFC) is providing a US$75 million loan to Southeast Asia Commercial Bank (SeABank) to support local businesses.
Southeast Asia Commercial Bank (SeABank) today said that IFC under the World Bank has just decided to invest $75 million in SeABank which can be converted into shares of SeABank within five years.
IFC's investment aims to support SeABank's development strategies and improve the accessibility to loans of small and medium-sized enterprises including dependent enterprises which own by women.
SeaBank leaders revealed that with this loan, SeABank also pledged not to finance new coal-related activities in line with IFC's approach to addressing climate risks. This commitment will contribute to Vietnam's climate goals including phasing out coal-fired power generation by 2040 and achieving net zero carbon emissions by 2050. SeABank's conclusion will be a condition for IFC to consider converting the loan into common shares within the next five years.
Previously, IFC and five other international investment funds have granted a credit package totaling $220 million to SeABank to provide financial support to small and medium-sized enterprises, women-owned enterprises, and green credit.
Vietnam-US bilateral trade to surpass US$100 billion
Bilateral trade between the nation and the United States is anticipated to exceed the US$100 billion mark during the past 10 months of the year, according to the latest data released by the General Department of Vietnam Customs.
This marks the second consecutive year that two-way trade turnover has exceeded this milestone.
During the initial nine months of the year, Vietnamese exports to the US market surged by 23.7% to reach US$85.17 billion compared to the same period from last year.
There were a total of 11 groups of export commodities to the US which had a turnover exceeding US$1 billion, of which four groups raked in revenue of more than US$10 billion, including computers, electronic products and components with US$11.6 billion, as well as phones and components with nearly US$10.1 billion.
Most notably, the group of machinery, equipment, tools and spare parts surpassed the textile and garment category to become the largest export group in the US market, with turnover reaching approximately US$15.1 billion, representing an annual rise of 30.17%.
The garment and textile group ranked second with US$13.87 billion, an increase of 19.36% against the same period from last year.
Furthermore, the US also makes up the leading major market for Vietnamese export items such as timber and wood products, seafood, means of transport and spare parts, toys, sports equipment.
At present, the US is seen as Vietnam's largest export market, accounting for 30.16% of the country's total export turnover during the first nine months of the year.
Meanwhile, the country imported goods from the US worth US$11.15 billion in the reviewed period, a decline of US$600 million on-year, with the nation enjoying a trade surplus of US$ 74.02 billion with the US.
Standard Chartered raises Viet Nam’s 2022 GDP growth forecast to 7.5%
Standard Chartered Bank has raised its Viet Nam GDP growth forecast for 2022 to 7.5 per cent from the previous 6.7 per cent and for 2023 to 7.2 per cent from 7.0 per cent to reflect robust Q3 growth of 13.7 per cent year-on-year. The last quarter 2022 growth is anticipated at 4.0 per cent.
While the bank lowers its inflation forecast for this year to 3.3 per cent from 4.2 per cent, it expects an acceleration in Q4 to 5.0 per cent from 3.3 per cent in Q3. Inflation has been largely under control; price pressures may increase in the rest of 2022 and in 2023. In addition to supply-side factors, demand-side factors might kick in more strongly.
“We maintain our average 2023 inflation forecast at 5.5 per cent, expecting it to rise throughout next year, reaching around 6 per cent late next year. We see inflation as a threat to Viet Nam’s continued recovery,” said Tim Leelahaphan, Economist for Thailand and Viet Nam, Standard Chartered Bank.
Standard Chartered’s economists expect the State Bank of Viet Nam (SBV) to continue tightening monetary policy and forecast a 50bps hike in the refinancing rate each in Q4-2022 and Q1-2023, taking the rate to 6 per cent, following a 100bps hike to 5 per cent on 22 September.
According to the UK-based lender, the VND is likely to face several headwinds in the short term – a hawkish Fed, strong USD, higher commodity prices and slowing external demand. The VND continues to significantly outperform its peers across EM Asia, despite recent depreciation.
Standard Chartered Bank expects the pace of VND depreciation to slow in the coming months. USD-VND’s correlation with USD-CNY remains extremely strong. As such, a peak in USD-CNY will likely coincide with the peak in USD-VND. The Bank forecasts USD-VND at 24,200 by end-2022 and at 24,000 for end-Q1-2023 and declining towards 23,400 by end-2023.
Ha Noi looks to take action on delayed industrial cluster projects
The People's Committee of Ha Noi is considering withdrawing investment certificates from slow-moving industrial cluster projects.
The measures would apply for projects that have still to make progress 12 months after the issue of investment certificates, according to Decision 33/2022 on the regulation on management of industrial clusters in Ha Noi effective from October 14, 2022.
This decision includes regulations on the establishment and adjustment of industrial cluster development plans; and building and expanding the industrial clusters.
It also contains regulations on carrying out projects on building technical infrastructure of industrial clusters.
The decision also has regulations for State management offices relating to the operation of industrial clusters in the city, including cooperation and responsibilities between the offices and authorities of districts in Ha Noi to improve the efficiency of industrial cluster management.
Those aim at ensuring consistency and creating favourable conditions for investors in investing in production and business in the industrial clusters.
According to the Ha Noi Department of Industry and Trade, the State agency managing industrial clusters in Ha Noi, there are 70 industrial clusters operating in the city, attracting about 3,900 households and enterprises to invest in production and business activities.
In the 2018-2020 period, Ha Noi decided to establish 43 new industrial clusters, meeting demand for the development of industrial sectors.
However, the city has so far started construction on just seven industrial clusters due to many difficulties. They include Dai Thang and Phu Tuc projects in Phu Xuyen district; Di Nau project in Thach That district; Thang Loi and the second stage of Tien Phong projects in Thuong Tin district; the second stage of Dan Phuong project in Dan Phuong district; and Vong Xuyen project in Phuc Tho district.
ETFs draw more capital in October
The capital inflow into exchange-traded funds (ETFs) is returning to the market after a long period of stagnation, and even net withdrawals over the past three months.
Since the beginning of October, ETFs have net withdrawn about VND1.8 trillion (US$75.4 million), of which Fubon FTSE Vietnam ETF alone attracted more than VND900 billion. So far the fund has drawn a cash flow value of up to VND7.2 trillion.
DCVFM VNDiamond ETF also made an impressive comeback after three consecutive months of being net sold, with a value of more than VND1.8 trillion in the third quarter. Since the beginning of October, this ETF has net withdrawn about VND335 billion, thereby raising the value of cash inflow from the beginning of this year to VND4.1 trillion.
DCVFM VN30 ETF saw a net withdrawal of more than VND400 billion since the beginning of October, the largest amount since the beginning of this year. Previously, in the first seven months, this ETF was being net sold strongly. Since the beginning of this year, the cash flow into VN30 ETF has remained negative by nearly VND1.5 trillion.
V.N.M ETF has attracted VND247 billion since the beginning of October. Previously, this ETF continuously net sold nearly VND1.2 trillion after 9 months.
On the other hand, the capital inflow into SSIAM VNFinLead ETF is showing signs of reversing as it was net sold VND52 billion since the beginning of October after drawing money inflow for six consecutive months. The FTSE Vietnam ETF is also slowing down after three successful months of withdrawals. However, since the beginning of this year, both FinLead ETF and FTSE ETF have been attracting money with a value of more than VND450 billion and nearly VND200 billion, respectively.
9,500 cyber-attacks in nine months
Nearly 1,000 cyber attacks caused problems in information systems in Viet Nam last month, a year-on-year increase of nearly 20 per cent.
From the beginning of this year to the end of September, the Authority of Information Security has recorded, warned and helped handle 9,519 cyber attacks on information systems in Viet Nam.
There are nearly 1,060 cyber attacks causing problems to information systems on average each month in the first nine months of the year.
To ensure network information security, the Ministry of Information and Communications said it would continue strengthening the scanning work in Vietnamese cyberspace.
The ministry will continue to evaluate, make statistics and promote communications and warnings while urging a review of weaknesses, vulnerabilities, and signs of cyber attacks to State agencies, information security units, financial institutions, and banks.
HCMC Metro Line No.1 depots and stations ready in first quarter 2023
The Metro Line No.1 project is 92.53% complete, with depots and stations remain to be finished in the first quarter of 2023, according to HCMC’s Management Authority for Urban Railways (MAUR).
CP1a, which is one of the two tender packages for the underground session and comprises a tunnel between the Ben Thanh Market Station and the Opera House Station, is 97.39% complete. CP1b, another underground tunnel linking the Opera House and Ba Son stations, is 99.64% complete.
Package CP2, comprising an elevated track and depots, is 96.30% ready, while package CP3 consisting of purchasing and installing electrical systems, rolling stock, and rail, is 83.71% complete.
MAUR said that the contractors are accelerating work on the stations between the Long Binh depot and the Binh Thai station so that it can be done by December 2022.
Manpower has been mobilized to complete the stations along the line between the Phuoc Long Station and the Van Thanh Station by the first quarter next year.
Hoang Van Tu, who is in charge of the elevated stations of the Sumitomo-Cienco6 Consortium (SCC), said that 93% of the Tan Cang station had been finished, with four train lines linking Metro Line No.1, also known as Ben Thanh-Suoi Tien, and Metro Line No.5.
Tu added that 50% of the equipment imported from Europe was brought in by air, as it took up to five to six months to receive goods via sea shipping.
The Ben Thanh-Suoi Tien line stretches 19.7 kilometers, with a 2.6-kilometer underground session lined with three stations and a 17.1-kilometer elevated session lined with 11 stations. Its adjusted investment cost is VND43,700 billion.
In 2012, the project broke ground after being approved in 2007. Originally, the project was scheduled to be completed in 2017 and put into operation in 2018.
Due to site clearance issues, the project fell far behind schedule and was rescheduled to the fourth quarter of 2023.
Businesses start issuing C/O Saturday
From October 15, businesses can issue certificates of origin (C/O) for their products using 14 forms from the Ministry of Industry and Trade’s Electronic Certificate of Origin Issuance System.
To promote exports and reduce business costs, the ministry issued Notice 257/TB-BCT, allowing enterprises to download and print C/O forms on the website https://ecosys.gov.vn.
Certificates of origin must be printed on A4 white paper sheets and are valid until April 15, 2023.
The ministry said it has notified the countries that signed free trade agreements with Vietnam of the contents of the notice.
FPT invests in Japan’s consulting service provider
Vietnam’s tech giant FPT has cut a deal with Japan’s consulting service provider LTS Inc. to become the latter’s strategic shareholder.
The strategic partnership is aimed at helping FPT strengthen its capabilities in Japan’s consulting industry and target more double-digit million-U.S. dollar deals.
The Japanese firm will help FPT enhance its consulting knowledge across industries and engineering resources, thereby improving customers’ business results. Furthermore, FPT will provide LTS with strengthened software services and strong expertise in new emerging technologies.
Technical glitches force shutdown of power plant in Quang Ninh
The Cam Pha thermal power plant in the northern province of Quang Ninh has been forced to suspend its operations due to technical glitches, according to the Vietnam National Coal and Mineral Industries Group (VINACOMIN).
Moreover, the power station has not received coal from the Cua Ong Coal Preparation Company for several months, a representative of the company said.
VINACOMIN is racing against time to fix the problems and put the power plant back into operation.
The VND10-trillion plant is designed to turn out 3.68 billion KWh of electricity.
Since 2010, the plant has seen repeated operation disruptions due to technical failures.
In just nine months of 2018, some 25 technical failures were reported, two of which severely affected the plant’s power generation plan.
Hong Kong explores investment opportunities in Vietnam
Trade and investment opportunities in Vietnam were highlighted at a workshop in Hong Kong (China) within the framework of a series of tech fairs from October 13-16.
Vu Thi Thuy, head of the Vietnamese Trade Office in Hong Kong, said in the first nine months of this year, Vietnam’s GDP grew 8.83%, and its total export-import value reached 557.9 billion USD, up 15% year-on-year.
She also cited the General Statistics Office (GSO) saying in the nine months, import-export between Vietnam and Hong Kong was valued at 9.97 billion USD, a rise of 3.92% year-on-year.
Hong Kong is now Vietnam’s fifth biggest investor with total registered capital amounting to 28.53 billion USD and 2,110 projects.
Economist Corey To from the Hong Kong Trade Development Council (HKTDC) delivered a speech on Vietnam’s consumer market, saying Vietnam is one of the countries with good post-pandemic recovery.
According to the International Monetary Fund (IMF), Vietnam’s GDP growth is expected to stand at 7% this year, and about 6.2% next year.
The tech fairs, organised by the HKTDC, brought together 1,100 units from France, the Republic of Korea, Taiwan (China) and mainland China.
Source: VNA/SGT/VNS/VOV/Dtinews/SGGP/VGP/Hanoitimes