The Ministry of Transport (MoT) has just sent a document to the Ministry of Planning and Investment (MPI) on the allocation of over 7 trillion VND (287.3 million USD) worth of medium-term foreign capital in the 2021-2025 period for the Hanoi - Hai Phong expressway project.

Accordingly, the MoT proposed the MPI to report to the Government to submit to the National Assembly Standing Committee for permission to allocate the medium-term public investment plan for the 2021-2025 period with foreign capital for the Hanoi - Hai Phong expressway under the policy of allowing the transfer of on-lending and government loan guarantee into state budget allocation, approved by the National Assembly in Resolution 63/2022/QH15 dated June 16, 2022.

The amount will be used to pay almost 4.7 trillion VND in the principal of a loan from the Export-Import Bank of Korea and over 2.33 trillion VND in the principal of a loan from the German Development Bank (KfW).

The 105.5km Hanoi-Hai Phong expressway had a total investment of over 45.48 trillion VND. It was opened to traffic in 2015.

Vietnam hopes to attract more capital from RoK

Policies and orientations on attracting foreign investment, especially from Korean businesses, spotlighted a conference in the capital city of Hanoi on October 18.

The latest data from the Ministry of Planning and Investment (MPI) showed that the accumulated registered FDI capital from the RoK from 1988 to September 2022 reached more than 80.5 billion USD with more than 9,400 operating projects.

In the first nine months of 2022, the RoK ranked second among 97 countries and territories investing in Vietnam with 290 projects, worth over 3.8 billion USD.

Do Nhat Hoang, Director of the Foreign Investment Agency under the MPI, praised the effective contributions of Korean enterprises to Vietnam’s socio-economic development. Particularly, the country has seen a shift in capital flows from Korean investors in basic manufacturing to high-tech industries, energy, banking, financial and high quality services, and M&A.

Hoang said he believed that the RoK maintains its position as Vietnam’s leading source of foreign investment. “In the next one to two years, the two countries can fully realise the "Dual Goals", which aims at the milestone of 100 billion USD in bilateral trade turnover and total accumulated investment,” he said.

Bae Yong Geun, Vice President of the Korean Chamber of Commerce and Industry in Vietnam (KOCHAM), said that Vietnam, the epicentre of the Korean wave in Southeast Asia, is an important destination, and the countries have experienced the strongest cooperation in the world.

At the event, Yoon Chang Woo, General Director of POSCO Vietnam, an enterprise with more than 30 years of investment in Vietnam, said that thanks to the support from the Government, the company was able to overcome difficulties during the COVID-19 pandemic.

Yoon suggested that southern provinces need to develop human resources and essential infrastructure. More Korean enterprises wish to invest in these provinces, but barriers in human resources and infrastructures might make them hesitate.

For his part, Koen Soenens, General Sales and Marketing Director of DEEP C Industrial Zones, said DEEP C will continue to expand new industrial parks to welcome more large investors, and these new industrial parks will ensure sustainability standards like the current five parks.

Entering Vietnam since 1997, DEEP C has been operating in the field of industrial park complex development. It is striving to a greener standard to be different, providing a sustainable and reliable investment location for customers is the goal of DEEP C.

One-fifth of relief package disbursed for economic recovery

The disbursement of the relief package for economic recovery and development had reached VND61 trillion as of September 30, accounting for 20.2% of the total budget of some VND350 trillion, according to the Ministry of Planning and Investment.

Over VND3,544 billion was disbursed to support around five million workers to pay for their house rentals as of September 23, exceeding the target of four million people.

Over VND10,704 billion was used for the preferential credit programs by the Vietnam Bank for Social Policies, supporting nearly 240,000 borrowers as of September 30.

The disbursement of the financial aid package with an interest rate discount of two percentage points for businesses reached roughly VND29 billion.

Regarding tax policies, nearly VND39,422 billion was disbursed to compensate for reduced value-added and environment protection taxes on fuels.

Roughly VND7,400 billion was used for policies related to extending time limits for paying taxes and land rent.

Vietnam footwear market to boom by 2031, value to rise double to US$38.7 bln

The Vietnamese footwear market is anticipated to hit US$38.7 billion in value by 2031, doubling this year’s estimated figure of US$19.1 billion, according to market research firms.

Vietnam currently ranks second in the world in terms of footwear exports, behind only China. About  one billion pairs of footwear are shipped overseas each year, with last year alone seeing footwear manufacturers rake in roughly US$20.78 billion from exports.

The country is home to roughly 2,200 footwear manufacturing enterprises, mostly located in Ho Chi Minh City.

It’s noteworthy that several major international brands such as Nike and Adidas have decided to base their main production facilities in Vietnam thanks the country’s political stability, attractive investment climate, and young and cheap labour.  

At present, Nike boasts over 100 suppliers in the country, with 96 factories in the southern region, while Adidas has also chosen Vietnam its main production area.

Despite the optimistic outlook, industry insiders note that the sector is still in the process of recovering as by the end of 2021 only 80% of workers returned to their jobs following the COVID-19 pandemic, a factor which has hindered production activities.

Therefore, local businesses are anticipated to face fierce competition from other developing ASEAN countries, including Indonesia and Malaysia, both of which have a young and low-paid workforce.

Data compiled by the Observatory of Economic Complexity (OEC) indicates that footwear was the country’s third largest export item in 2020, while its main footwear export markets were the United States (US$6.43 billion), China (US$2.24 billion), Germany (US$1.03 billion), Japan (US$953 million), and the Republic of Korea (US$730 million).

The OEC noted that during the 2019 to 2020 period the fastest growing Vietnamese footwear export markets were China with turnover reaching US$272 million, Poland with US$25.6 million, and Taiwan (China) with US$22.6 million.

Five energy projects suggested for national power plan removal

The Ministry of Industry and Trade (MoIT) has proposed removing five thermal power plant projects from the National Power Development Plan VIII unless investors commit to arranging enough capital.

In the document submitted to the government on October 13, the MoIT proposed removing the five thermal power projects from the PDP8 because investors are facing difficulties implementing them.

The projects combine four with foreign capital, namely Song Hau 2, Nam Dinh 1, Vinh Tan 3, and Quang Trị 1, while Cong Thanh is funded by a local investor.

The MoIT asked the investors of these projects to prepare a specific commitment from loaners to provide capital for them. The investors must submit these commitments attached with documents to the MoIT before October 30. This is an important basis for keeping these projects in the Power Master Plan.

The five power plants:

- The Vinh Tan 3 thermal power plant invested by Vietnam Electricity, Pacific Group, and OneEnergy Asia Ltd., a partnership of Hong Kong’s CLP Holdings and Japan’s Mitsubishi Group.

- The Nam Dinh 1 thermal power plant invested by a consortium of Saudi Arabian ACWA Power and South Korean Taekwang Power Holdings Co., Ltd.

- The Quang Tri 1 thermal power plant invested by EGAT International Co., Ltd.

- The $3.5 billion Song Hau Coal-fired power plant II invested by Toyo Ink Group.

- The Cong Thanh thermal power plant invested by the Cong Thanh Thermal Power JSC.

Vietnam’s political, business environment stable: Russian newspaper

The role and position of Vietnam in the world politics and economy was highlighted in an article published by Russia’s Independent newspaper on October 17. 

In his article, Grigory Trofimchuk highly valued the role played by Vietnam in particular and ASEAN in general, in efforts to promote Russia's "Look East" policy amid strong volatilities in the world.

After Vietnam completed its role as a non-permanent member of the United Nations (UN) Security Council, it was immediately elected to the UN Human Rights Council for the 2023-2025 tenure, the article said. 

According to Trofimchuk, Vietnam has a stable political and business environment, with many incentives and benefits for foreign investors, including those from Russia. 

Russia needs to show clearer its role in solving problems in Asia-Pacific, and Southeast Asia in particular, in the process of “turning to the East”, the article stressed, adding that Vietnam is a potential partner for this scheme.

Mechanisms needed for enterprises to join national science-technology programmes

Mechanisms are needed for businesses to strongly participate in national science and technology programmes together with state research institutions, Deputy Prime Minister Vu Duc Dam has said.

Dam made the recommendation at a conference held in Hanoi on October 17 by the Ministry of Science and Technology (MOST) to launch national sci-tech programmes for 2021-2025.

The Deputy PM requested enhancing publicity, transparency and accountability in scientific research activities.

In the time to come, he asked the ministry to accelerate the implementation of the national science and technology programmes for the 2021-2025 period and ensure their quality in compliance with regulations.

The MOST also needs to organise strong research groups for these programmes, and gradually handle management and financial issues in the sector, the Deputy PM added.

Regarding the humanity and social sciences, Dam requested related research programmes to give specific recommendations and promote research on culture.

At the conference, Minister of Science and Technology Huynh Thanh Dat said the ministry has restructured the national science and technology programmes for 2021-2025 with a vision to 2030.

Da Nang holds potential to become ‘Silicon Valley’ of Southeast Asia: seminar

The central city of Da Nang holds great potential to become a ‘Silicon Valley’ of Southeast Asia, especially when it receives more investment, technology and resources of firms which come from the US’s ‘Silicon Valley’, an official has said.

It also ranked first in Vietnam in terms of digital transformation in 2021, he said, adding that the US’s ICT enterprises cooperating with Da Nang will see a lot of opportunities to succeed in digital transformation, and can easily expand collaboration with other Vietnamese localities, and even cities of other countries in the region.

Adam Sitkoff, executive director from the American Chamber of Commerce (AmCham) Hanoi, said that US firms are able to see Da Nang’s potential in digital transformation. Therefore, this business linkage programme will create a new mark for cooperation between the two sides, he added.

Deputy director of the municipal Department of Information and Communications Le Son Phong said that his city began building the e-government from 2010, and piloting several smart apps in transport, the environment, health, education and food safety and hygiene from 2014.

It won ASOCIO Smart City Award 2019 by the Asian-Oceanian Computing Industry Organisation (ASOCIO), Smart City Award Vietnam in 2020 and 2021, and also ranked first in Vietnam’s Digital Transformation Index in these years.

Vietnam-Laos trade surpasses 1.2 billion USD in first nine months

Trade turnover between Vietnam and Laos hit 1.22 billion USD in the first nine months of 2022, up 29% year-on-year.

Of the total, exports were valued at 465.7 million USD, up 4.1%, and imports 755.8 million USD, up 51.3%.

Vietnam’s main exports included fruit and vegetables (44.8 million USD, up 230%), petrol and diesel (52.4 million USD, up 268%) and fertilisers (26.5 million USD, up 53.4%).

The country mainly imported rubber (169.3 million USD, up 58.7%), fertilisers (67.4 million USD, up 123.3%), and wood and wooden products (106.2 million USD, up 49.7%) from Laos.

According to the Vietnam Trade Office in Laos, with the current growth pace, two-way trade may reach 1.6 billion USD this year, up 20% year-on-year, fulfilling the target set by the countries’ senior leaders at the 44th meeting of the inter-governmental committee on bilateral cooperation.

30 foreign suppliers declare, pay tax via portal

As many as 30 big foreign suppliers, including Microsoft, Facebook, Netflix; Samsung; TikTok; and eBay made tax declaration via the portal http://Etaxvn.gdt.gov.vn and paid 22.2 million USD worth of tax, according to a report recently submitted by the Ministry of Finance to the National Assembly.

Besides the portal for foreign suppliers, the ministry also applied electronic tax collection via a mobile device platform (eTax Mobile) to facilitate tax management in the field of e-commerce business.

Since March 21, 2022, there have been 140,615 downloads and installations of the eTax Mobile app, with 69,465 transactions conducted via commercial banks with a total value of over 308 billion VND (nearly 12.67 million USD).

The ministry said it had granted in-principle approval for developing an e-commerce database portal to receive data from e-commerce trading floors. The portal is slated to be completed in November this year and officially launched in January next year.

The ministry reported that tax revenue declared and paid on behalf of foreign suppliers by organisations in Vietnam since 2018 has hit nearly 5.59 trillion VND. The figure in 2021 alone reached 1.59 billion VND, up 39% compared to the previous year.

Facebook, Google and Microsoft were major tax payers, paying 2.099 trillion VND, 2.114 trillion VND and 714 billion VND in tax respectively to the State budget.

Plastic factory using circular recycling technology inaugurated in Hai Duong

A plastic factory equipped with modern production lines and technologies invested by the Binh Thuan Plastic Group JSC was inaugurated in Binh Giang district, the northern province of Hai Duong on October 16.

With four presses and two granulation lines, the plant is expected to produce 2,250 – 2,550 tonnes of pallets and 16 tonnes of plastic granules per day.

The same day, another plant specialising in producing industrial products and molds was put into operation in the southern province of Binh Duong. It is also invested by the Binh Thuan Plastic Group JSC.

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 1.8 trillion VND (75.4 million USD), of which Fubon FTSE Vietnam ETF alone attracted more than 900 billion VND. So far the fund has drawn a cash flow value of up to 7.2 trillion VND.

DCVFM VNDiamond ETF also made an impressive comeback after three consecutive months of being net sold, with a value of more than 1.8 trillion VND in the third quarter. Since the beginning of October, this ETF has net withdrawn about 335 billion VND, thereby raising the value of cash inflow from the beginning of this year to 4.1 trillion VND.

DCVFM VN30 ETF saw a net withdrawal of more than 400 billion VND 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 1.5 trillion VND.

V.N.M ETF has attracted 247 billion VND since the beginning of October. Previously, this ETF continuously net sold nearly 1.2 trillion VND after nine months.

On the other hand, the capital inflow into SSIAM VNFinLead ETF is showing signs of reversing as it was net sold 52 billion VND 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 450 billion VND and nearly 200 billion VND, respectively.

Capital inflows are showing signs of returning to the Vietnamese market through ETFs despite the global withdrawal trend due to the US Fed's rate hikes to attract money. The prospect of Vietnamese securities is still considered attractive, especially in the eyes of foreign investors. The recent investment from Hong Kong CSOP FTSE Vietnam 30 ETF pouring capital into the Vietnamese stock market is a clear example. This ETF is expected to invest 100% of its assets in Vietnamese stocks.

CSOP is an investment-focused asset management company in the Chinese market. CSOP currently manages public and private equity funds, as well as provides investment advisory services to Asian and global investors. As of August 31, 2022, CSOP is managing more than 12 billion USD.

According to the CSOP assessment, Vietnam is one of the fastest-growing economies in the world. Thanks to a favourable domestic and global environment, Vietnam's GDP has grown 15 times over the past 25 years. Vietnam is also the only Southeast Asian country to maintain positive economic growth in the last two years despite the COVID-19 pandemic. The International Monetary Fund (IMF) forecasts that Vietnam will be one of the fastest-growing economies in Southeast Asia.

Previously, the third ETF under Dragon Capital, DCVFM VNMidcap ETF, was also officially listed on September 29. This ETF is the first fund to refer to the VNMidcap, a market-capitalisation-weighted index which measures the performance of 70 medium market-capitalisation companies on the HoSE. This is a popular group among many individual investors, especially in the last two years thanks to its good liquidity and high price volatility.

The KIM Growth VNFinselect ET will also be launched soon. This ETF's portfolio includes leading bank and securities company stocks in terms of liquidity and capitalisation.

The appearance of new ETFs promises to bring more choices to investors and at the same time attract capital flows into the market in the future.

Hanoi opens more OCOP showrooms

The Hanoi Department of Industry and Trade has opened three showrooms of the “One Commune, One Product” (OCOP) programme over the past few days, part of efforts to popularise high-quality specialties of the capital and other localities to local consumers.

The same day, the department kicked off a week of OCOP products at the BigC Thang Long shopping centre in Cau Giay district. The event, lasting through October 18, features 60 booths of more than 40 businesses and OCOP producers of Hanoi and over 10 other localities.

Meanwhile, another OCOP showroom was opened in Hong Van commune of Thuong Tin district on October 15.

Also on October 15, the municipal Department of Industry and Trade launched a showroom in Bich Hoa commune of Thanh Oai district, which has long been renowned for such specialties as the Boi Khe and Bo Nau rice, Kim Duong orange, Uoc Le pork pies, Cu Da soybean jam, and Chuong village’s conical hats.

Many of local products have been rated three - four stars under the OCOP programme, helping improve their value and make them more popular among consumers and visitors.

Hanoi is taking the lead nationwide in the number of OCOP products, with 1,649 products of 426 businesses, cooperatives, and business households given stars. They include four products rated five stars, 1,098 others rated four stars, and 534 rated three stars. There are 1,071 food products (65% of the total), 35 beverage, 17 herbal, 492 handicraft, and 34 fabric and apparel products.

So far, the city has developed about 60 OCOP showrooms across 26 district-level localities. The sites display and sell not only local products but also those of 25 other provinces and cities.

Austrian firms seek opportunities in Vietnam

A delegation of enterprises from Styria, the second biggest in term of area and the fourth populous state of Austria, arrived in Vietnam last weekend to learn more about business opportunities in the Southeast Asian country.

The delegation was led by Regional Minister for Foreign Affairs Barbara Eibinger-Miedl.

An article recently published on Austria’s Kronen Zeitung newspaper said the Vietnamese economy is booming with the presence of more and more foreign firms and investors, which is a trend that firms in Styria do not want to miss.

It quoted Eibinger-Miedl as saying that there are ample opportunities for Austrian firms to invest in Vietnam in energy technology and environment, design and construction, as well as green technologies.

Chief Executive of the Internationalisation Centre Styria Robert Brugger said after 2 years of closure due to COVID-19 pandemic, now is the right time for Styria to rise again while Vietnam has also returned to its growth trajectory in a spectacular way. He quoted experts as saying that that Vietnam's economy could grow by 7% annually and Austrian businesses want to seek opportunities there.

So far, a number of Austrian firms are doing well in Vietnam, namely equipment manufacturer Andritz, power train system developer EVL List, steel maker Voestalpine, among others.

Data from the Austrian Federal Economic Chamber (WKO) showed that in 2021, Styria exported 28 million EUR worth of goods to Vietnam while spending 147 million EUR on imports from the country.

Vietnam anticipates surge in foreign arrivals over coming months

Representatives of local travel operators indicate they have made plans to welcome hundreds to thousands of foreign visitors to Vietnam in the final months of the year.

Pham Duy Nghia, director of Vietfoot Travel, stated that his firm has prepared a total of 25 50-seater buses to welcome a delegation of up to 1,000 people, including many international tourists from the UK and Sri Lanka wishing to tour Quang Ninh province which is home to UNESCO-recognised Ha Long Bay.

Sharing this perspective, Tran The Dung, general director of Fiditour, revealed his company has recently received several groups of international holidaymakers who all gave extremely positive feedback about their trips.

Vietnam received 1.87 million foreign visitors in the Jan. – Sept. period and it aims to attract five million foreign travelers this year.

Market tools help businesses export: experts
     
Businesses should look more into using market research tools to identify foreign trade opportunities amid rising challenges, experts have said.

Speaking at a conference last week on helping businesses expand export markets, Huynh Minh Vu, deputy director of the HCM City Centre of International Integration Support (CIIS), said Viet Nam’s integration and free trade agreements were providing enormous export opportunities.

But many countries were increasingly using non-tax barriers to protect their domestic markets.

Global inflation was also changing the behaviour of consumers in Viet Nam’s key markets such as the US and the EU, making them prudent with their spending and buying fewer non-essential products, he said.

This was hindering Viet Nam’s key exports such as textile and garment, footwear and wood furniture, he said.

Le Viet Dung Linh, a market research expert at the International Trade Centre (ITC) Viet Nam, said that Vietnamese businesses could use ITC’s market research tool for free.

They could also keep up to date with sanitary standards and technical barriers in various markets, and can even be notified of the latest developments, he added.

Experts at the conference said there were many other good market tools that could provide useful information but businesses needed to be able to use the data effectively.

Northern provinces make efforts to lure Korean investors
     
Northern provinces in Viet Nam are making great efforts to promote their potential and call for investment from South Korea.

Ha Nam has become a popular destination in the northern region, stepping up its efforts to attract large investment from the Republic of Korea (RoK).

In order to strengthen connectivity, promote friendly cooperation activities, and attract investment between Ha Nam and Korean localities and businesses, last month the province coordinated with the Vietnamese Embassy in South Korea and Korea Chamber of Commerce and Industry (KCCI) to organise an investment promotion conference on boosting trade promotion. The event drew about 100 firms from the RoK.

Korean technology combined with the intrinsic advantages and openness of Viet Nam's economy increase the competitiveness of goods in the global value chain, he said.

The RoK currently leads 13 countries and territories investing in Ha Nam in both project number and value. Outstanding Korean firms operating in the province include Seoul Semiconductor Co., Ltd, Anam Electronic Co.,Ltd, Kortek Co., Ltd, and Dream Plastic.

Vinh Phuc has also called for investment from RoK at a conference in Gyeong province of RoK in September.

The northeastern province of Quang Ninh is no exception and also wants to call for investment from South Korea.

The provincial leaders have called on Korean investors and are willing to offer advantages for investors in industries in which the province has outstanding competitive advantages and distinct potentials, especially tourism and services, processing, manufacturing and support industries, high-tech, marine, logistics services and green economy such as renewable energy, wind power and digital economy.

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