Public investment is expected to be an engine for Vietnam’s economic growth in the context that global headwinds may challenge the country’s growth target of 6.5%, according to experts.

General Director of the General Statistics Office (GSO) Nguyen Thi Huong said that the Government, ministries, sectors and localities are striving to push the disbursement of public investment to fuel the development of construction, transport and building materials.

To the end of this year, the Government will prioritise capital for large-scale projects, and those which are nearly completed so as to maintain and expand enterprises’ production and business capacity, she said, adding the implementation of public-invested projects will be accelerated to boost aggregate demand.

Huong described those as bold steps to promote settlement of site clearance issue, as well as encourage businesses to enter the market, ensuring that there is sufficient supply of materials for investment.

The GSO suggested stakeholders promote investment-trade activities effectively while improving business climate towards liberalisation, facilitation, socialisation, and reduction of business costs for companies.

Besides, tariff cut policies, and increases of credit guarantee for small- and medium-sized enterprises are necessary to support businesses, Huong said, highlighting the Government should promote the equitisation of State-owned enterprsies.

Meanwhile, economist Vu Dinh Anh said the Prime Minister’s resolve to disburse at least 95% of the public investment budget, or over 675 trillion VND (27.4 billion USD), is feasible if such barriers as complicated regulations on the public investment law, and bottlenecks in project implementation are removed.

Anh blamed the slow disbursement of public investment to complex administrative procedures, sluggish site clearance, and poor sense of responsibility from officials in many localities.

Besides, highly fluctuating raw material costs are another factor that hinders the progress of public investment projects, he said, adding it is necessary to improve bidding procedures to avoid overruns caused by huge delays.

With the concerted efforts from the whole political system, the Government’s resolve and officials’ innovation and high sense of responsibility, Vietnam will realise the target set for disbursement of public investment, Anh affirmed.

VNDirect Securities Corporation expected disbursement of public capital in 2023 to grow 20-25% against the previous year, relishing prospects on infrastructure development in the coming years thanks to the settlement of raw material supply shortage and increasing material costs.

General Director of Vietnam Report JSC Vu Dang Vinh said that 2023 is a tough year, and public investment is an important factor for the economy and the construction sector in particular.

Vietnamese coffee producers urged to focus on quality for sustainable export

While Vietnam's coffee industry was on track for another record export year, driven by rising prices due to supply shortages, experts said it's time for the industry to focus on quality to increase added value and export sustainably.

According to the Ministry of Agriculture and Rural Development, Vietnam was expected to earn 4.2 billion USD from exporting 1.7 million tonnes of coffee this year, a new high after setting the record at more than 4 billion USD last year, providing a firm foundation for the export target of 6 billion USD by 2030.

Pham Quang Anh, director of the Mercantile Exchange of Vietnam’s Information Centre, said Vietnamese coffee exports could reach a record level this year thanks to domestic and global prices climbing to their highest levels in the past 15 years due to scarce supply, low coffee reserves, and a strong increase in global demand for Robusta.

Statistics from the General Department of Customs showed that Vietnam’s coffee exports reached 1.266 million tonnes worth 3.16 billion USD from January to September, a drop of 7.3% in volume but an increase of 1.9% in value over the same period last year.

The average export price was 2,499 USD per tonne during this period, 9.9% higher than the same period last year.

The average price in September was 3,151 USD per tonne, 3.2% higher than August and 29.6% higher than one year ago.

Despite strong exports, Vietnam's coffee industry faces uncertainty in maintaining exports at high levels in the long run because the exports remain heavily dependent on rising prices due to supply shortages, not on the added value of coffee products.

This fact urged the coffee industry to shift its focus to improving product quality and aligning with market taste trends, especially in the major coffee consumption markets, which accounted for around half of global coffee imports, including the EU and the US.

Customs statistics showed that Vietnam shipped 600,000 tonnes of coffee to the EU and the US in the first eight months of this year, representing 50% of the country's total coffee export volume.

Major coffee import markets were transitioning from importing Robusta coffee beans to processed coffee.

According to the US Department of Agriculture, the US was becoming increasingly reliant on Arabica coffee and has progressively reduced Robusta imports from 6.1 million 60-kg bags in the 2010-11 crop year to 3.6 million bags in 2020-21. Processed coffee's share increased from 3.1% in the 2018-19 crop year to an estimated 6.4% in 2023-24.

According to the European Coffee Federation's statistics, the percentage of processed coffee surged from 2.3% in 2017 to 5.5% in 2021.

Vietnam’s customs data also indicated a significant drop in Vietnam’s Robusta coffee bean exports to the US, decreasing from 130,200 tonnes in 2018 to 90,500 tonnes in 2023, representing a decline of 27%. Vietnam predominantly exported raw beans to the US, a trend that remained largely unchanged from five years ago, indicating that Vietnam has been slow to adapt to the evolving tastes of major markets.

Climate change was occurring globally, leading to extreme weather phenomena like El Nino and La Nina, which directly affected the coffee crop.

According to the Vietnam Coffee Cocoa Association, erratic rains and storms during the 2022 coffee harvest season in the Central Highlands caused the output to decrease by about 10-15%. This year, El Nino also led to dryness in Vietnam’s major growing areas. The association noted that the upcoming crop output might be 10-15% lower, at around 1.47 million tonnes.

A Bloomberg survey estimated that coffee output might be 7% lower than the previous harvest season.

While coffee prices remained high, Vietnam was currently short of coffee for export. The Import-Export Department under the Ministry of Industry and Trade (MoIT) mentioned that the nation’s exports in the third quarter were slowing down due to limited supply.

The coffee supply was anticipated to increase in November when the 2023-24 harvest season began.

Anh emphasised the importance for the coffee industry to concentrate on quality and enhance the added value of coffee products through processing to boost exports.

Enterprises and farmers should collaborate to establish production chains, making it more feasible to adopt modern technology and promote the shift from raw to processed coffee, he suggested.

Increasing processed coffee could be a solution for Vietnam to boost exports, benefiting from signed free trade agreements that offer preferential tariffs of 0-5% for processed coffee products, Tran Thanh Hai, deputy director of the Import-Export Department (MoIT), stated.

Hai stressed that the coffee industry couldn't separate itself from the global commodity market, which was being influenced by rising inflation, geopolitical impacts, increasing input costs, and heightened competition from major producers like Brazil and Indonesia.

All these factors would influence coffee prices, Hai said, urging companies to closely monitor the market for suitable business and production strategies.

He encouraged businesses to intensify trade promotions to broaden markets while concentrating on quality raising and processing to meet the demands of importing markets and to establish brands for sustainable exports.

Nine-month overseas remittances to HCM City up 40% year on year

Ho Chi Minh City tallied 6.687 billion USD in overseas remittances during the first nine months of 2023, up 40% year on year and 1.3% over all of 2022, according to the local branch of the State Bank of Vietnam (SBV).

The remittances stood at 2.353 billion USD in the third quarter, up 6.2% from Q2. Totals in Q2 were up 4.5% from Q1, statistics show.

Nguyen Duc Lenh, Deputy Director of the SBV branch in HCM City, said the strong upward trend in overseas remittances is impressive, and it will have positive impact on the economy in multiple aspects.

He considered overseas remittances a “golden” resource for socio-economic development as it helps families improve quality of life and also stimulates the labour market.

In Q3, the money from Asia continued to account for the most, 53.1%, and increased 19.8% from the previous quarter.

The economic, political, and social stability in Asia, together with Vietnam’s growing economic, cultural, and labour cooperation with foreign partners will directly boost remittances in the time ahead, he noted.

In particular, amid the mounting pressure on foreign exchange rates, money sent back from abroad forms a source of foreign currency that bolsters supply and demand. 
 
This effectively supports the monetary and foreign exchange markets. It is even more important as fluctuations of strong currencies and high global inflation puts pressure on local foreign exchange rates, interest rates, and inflation, said the SBV official.

Steel industry expected to recover in 2024

Despite sluggish performance driven by a fall in steel prices, experts are optimistic about the steel industry’s recovery in 2024 as the Government's policies and the revised Land Law are put in place to support the realty market and the construction industry.

According to the Vietnam Steel Association (VSA), steel manufacturing output in September totaled nearly 2.34 million tonnes, up 2.41% month-on-month and down 4.2% year-on-year. Steel consumption was nearly 2.2 million tonnes, increasing 4.69% month-on-month, and 9.4% year-on-year.

The results were spurred by the Government's policies to remove bottlenecks and bolster economic growth from January – September, including those accelerating the disbursement of public capital for transport infrastructure development.

With recovery in demand, steel enterprises have recorded sound production results. Consumption of construction steel, hot-rolled coil steel and steel billets of Hoa Phat Group reached 596,000 tonnes in September, rising 7% against the previous month. Meanwhile, Vietnam Steel Corporation sold 268,000 tonnes of steel in September, the highest amount recorded since the outset of this year.

However, the VSA said although public investment and the realty market are heating up, which will boost steel demand for the remainder of the year, it is not until Q1 of 2024 that the steel market will see strong recovery.

Vietnam’s steel industry has been in a downward spiral, with steel prices falling 19 times since the start of 2023. Prices have been hovering around 13.5 million VND (548.56 USD) per tonne, due to gloomy real estate market, slow public investment disbursement, and fierce competition from China.

According to the steel industry's specialist Nguyen Van Sua, a slump in the realty market since the end of 2022 has driven steel demand down, while steel products imported from China at cheaper prices have created pressure on domestic steel prices.

In a bid to stabilise steel prices, it is necessary to accelerate the implementation of real estate and public investment projects, Sua said, adding that when the realty market becomes more vibrant, the steel market will heat up.

VNDirect Securities Corporation said that the steel industry will boom in 2024. The adoption of the amended Land Law will help remove financial bottlenecks for house buyers, throwing a charge into the real estate market.

Meanwhile, Director of Mercantile Exchange of Vietnam Pham Quang Anh believed that concerted efforts of the Government to promote the disbursement of public capital will stimulate demand and step up domestic business and production activities.

With robust signs from the realty and construction sectors, the steel market will recover soon, he added.

Vietnam-UK trade surges 16.6% in one year

The trade relationship between Vietnam and the United Kingdom experienced significant growth in bilateral trade over the past year, according to data released by the UK government's Department for International Trade on October 19.

The total trade in goods and services between the UK and Vietnam during the four quarters leading up to the end of Q1 2023 amounted to 6.7 billion GBP (8.14 billion USD), marking a substantial increase of 16.6% compared to the same period in 2022.

The UK’s exports to Vietnam showed remarkable growth, totalling one billion GBP during this period. This represents a notable increase of 21.1% year-on-year. Of the UK's exports to Vietnam during this period, goods accounted for 797 million GBP (77.5%), while services amounted to 231 million GBP (22.5%).

The exports of goods to Vietnam surged by 33.3%, while exports of services experienced a slight decrease of 8% compared to the same period in 2022.

The top five goods exported from the UK to Vietnam were pulp and waste paper, beverages & tobacco, and medicinal & pharmaceutical products, each constituting around 10% of all UK goods exported to Vietnam. Cars and plastics in non-primary forms followed with 4.4% and 4.1%, respectively.

On the other hand, the UK’s imports from Vietnam during the reviewed period reached 5.7 billion GBP, up 15.8% year-on-year. Of these imports, goods constituted 5.4 billion GBP (94.6%), while services accounted for 306 million GBP (5.4%).

Imports of goods from Vietnam experienced a growth of 12.6%, whereas imports of services surged by 137.2% year-on-year.

The top five goods imported to the UK from Vietnam included telecoms & sound equipment (capital) (1.7 billion GBP or 31.2% of all UK goods imported from Vietnam), clothing (542.9 million GBP or 10.1%), footwear (524.8 million GBP or 9.8%), furniture (consumer) (310.3 million GBP or 5.8%), and other manufactures (consumer) (290.7 million GBP or 5.4%).

Despite the impressive trade growth, the UK reported a total trade deficit of 4.6 billion GBP with Vietnam during the four quarters leading up to the end of Q1 2023, compared to a trade deficit of 4.1 billion GBP in the previous year.

The flourishing trade relationship between Vietnam and the UK can be attributed to their robust economic ties and collaborative efforts, notably following the implementation of the UK-Vietnam Free Trade Agreement (UKVFTA) on  May 1, 2021. Additionally, the UK's recent official signing of an agreement to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) on July 16, 2023 further strengthens their trade cooperation with the bloc members, including Vietnam.

Women’s participation in banking for new challenges resolution accelerated

Standard Chartered Vietnam and the State Bank of Vietnam (SBV) have jointly organised a conference themed “Accelerating women in banking for new challenges resolution” in Hanoi.

It is one of activities under the Minutes of Cooperation in gender equity between the SBV and Standard Chartered Vietnam to provide global perspectives on women leadership and skills upgrading for women and sharing of Diversity and Inclusion best practices and experiences.

SBV Deputy Governor Dao Minh Tu delivered the welcome remarks, affirming that the central bank has achieved key targets of gender equality plan in the banking industry in the period of 2021-2030.  

Michele Wee, CEO of Standard Chartered Bank Vietnam, said: “In Standard Chartered, we are building a bank that drives commerce and prosperity through a culture of diversity and inclusion. We aim to be a Great Place to Work, Great Place to Bank and support our communities.

"Our approach includes leadership commitment, alignment to client needs and services, inclusive leadership, focus on core people practices, global governance and accountability, transparency and measurement, local focus to address specific country needs. We are delighted to collaborate with SBV to organise this conference that aim to accelerating women’s participation in the banking sector.

"We remain committed to advancing diversity and inclusion in banking industry and in the society. We are looking forward to explore further initiatives with the local authorities and the government to empower and elevate women in banking.”

Standard Chartered Bank created a culture of inclusion including mental wellbeing, physical wellbeing, social wellbeing and financial wellbeing. In Vietnam, the bank has in place formal mentoring and development programmes, recruitment process and pay, where male and female employees across its different gender identities are equally valued.

The D&I council, led by the country CEO is a key pillar under People agenda programme that demonstrates senior leadership commitment to driving the agenda and making the Bank even more agile, empathetic, resilient, and innovative. The bank also ensures equal access to leadership development opportunities, maintains a strong framework of policies and procedures, fosters inclusivity in the work environment, promotes balanced gender representation in management positions and offers flexible work conditions.

Standard Chartered sets itself apart by offering especially privileged and comprehensive maternity and paternity leave supporting package and framework for both female and male colleagues, highlighting its commitment to supporting work-life balance.

Travel demand during Lunar New Year 2024 higher than last year

Vietnamese carriers Vietnam Airlines, Vietjet Air, Bamboo Airways, Pacific Airlines and Vasco have offered over 6 million tickets for sale to meet rising travel demand during Lunar New Year (Tet) 2024, which is forecast to be higher than last year.

According to the Civil Aviation Authority of Vietnam (CAAV), the Vietnamese airlines operated a total of 221,197 flights in the first nine months of this year. Of which, Vietnam Airlines Group, comprising Vietnam Airlines, Pacific Airlines and Vasco, operated over 100,000 flights, or about 45% of the market share. It was followed by Vietjet Air with 83,933 flights, equivalent to 38%; and Bamboo Airways 32,538 flights, roughly 15%.

The domestic airlines also recorded a 15% rate of delayed flights, equivalent to 33,227 flights. The cancellation rate was 0.3%, with 715 flights being cancelled.

The CAAV said late arrival of aircraft remained the leading cause of delayed takeoffs during this period.

Specifically, Vietjet Air took the lead in terms of delayed flights with 16,520 ones, accounting for nearly 20% of the total run by the airline.

Pacific Airlines came second in the rate of delayed flights, recording 2,559 ones, or 15.8%. Vietravel Airlines recorded 10,671 delayed flights, making up 13.5%.

Bamboo Airways reported 2,470 delayed flights, accounting for 7.6% of the total, maintaining its position as the most punctual airline during the period. It also stood out with a low cancellation rate, which was 0.2% of the total.

In the January-September period, there were 187,970 on-time flights, or 85% of the total.

Central bank forecast to continue bill issuance amid abundant liquidity

The State Bank of Vietnam (SBV) will continue to issue new bills to withdraw cash from the banking system as liquidity is abundant and interbank interest rates remain low, analysts forecast.

The SBV last month issued more than 110 trillion VND of 28-day bills, and the bills will mature this month. As a result, a corresponding amount of cash will be pumped back into the banking system if the SBV does not issue new bills. However, given that interbank interest rates are still low, KB Vietnam Securities Joint Stock Company (KBSV)’s analysts believe the SBV will continue to issue new bills to replace those that are maturing.

They explained that the move will be made as the overnight interbank interest rate returns to very low levels while the interbank foreign exchange rate and the interest rate gap between US dollar-denominated deposits and Vietnamese dong-denominated deposits remain high. This will stimulate dollar speculation and put pressure on the foreign exchange rate.

KBSV’s analysts do not rule out the possibility that the SBV might even increase the size and term of bills to be issued in the coming time.

In fact, in recent sessions, the SBV has moved to increase cash withdrawal through bill issuance. In the first nine trading sessions in early October, the SBV issued bills worth less than 10 trillion VND each, but from October 12 to October 16, the SBV increased it to 20 trillion VND each. Even on October 17, the bill value reached 17.95 trillion VND and 12.05 trillion VND the following day.

In the latest five trading sessions, the SBV withdrew 90 trillion VND, marking the strongest net withdrawal series since the bill issuance channel resumed operations on September 21. At the same time, the winning interest rate also remained at a high level of 0.9-1%, indicating a more aggressive stance from the SBV in withdrawing cash.

Government proposes NA continue 2% interest rate support policy

The Government has proposed the National Assembly (NA) to allow it to continue the 2% interest rate support policy for enterprises, cooperatives, and business households.

Presenting the results of the implementation of the NA’s Resolution 43/2022/QH15 (Resolution 43) on fiscal and monetary policies to support Vietnam’s post-pandemic socio-economic recovery and development at the NA's 6th session on October 23, Minister of Planning and Investment Nguyen Chi Dung said that after nearly two years of performance, Resolution 43 has proved to be a correct and timely decision of the NA as Vietnam's socio-economic situation faced many difficulties and challenges due to the COVID-19 pandemic.

Implementing the resolution, the Government in May 2022 issued Decree 31/2022/ND-CP on a 2% interest rate reduction in  loans of enterprises, cooperatives, and business households.

By the end of August 2023, the amount of interest rate support was equivalent to about 1.95% of the resources approved by the NA, with outstanding loans reaching nearly 57 trillion VND (2.31 billion USD) for more than 2,100 customers.

In addition, by the end of September 2023, the Vietnam Bank for Social Policies disbursed preferential credit of more than 21 trillion VND to more than 366,000 customers, disbursed about 3.679 trillion in rental support for 128,746 employers and nearly 5.2 million employees.

The Government also developed a list and level of capital allocated to tasks and projects in line with the provisions of the Law on Public Investment and the principles, criteria, and subjects of capital allocation. The Government urgently completed investment procedures for projects using capital from the socio-economic recovery programme.

The Government allocated more than 166 trillion VND of the 2022 and 2023 capital plans, contributing to accelerating the construction of socio-economic infrastructure projects, highways, and large bridges.

Besides the positive results, shortcomings and limitations remained, relating to the issuance of relevant instructions, forecasting, and calculating work. The implementation and disbursement of some issued policies failed to meet expectations. The policy implementation in some places and sometimes not flexible nor proactive, thus the allocation and disbursement of the programme's capital for tasks and projects is still slow, creating great disbursement pressure, especially in the 2023 plan.

On that basis, the Government proposed the NA permit it to continue the 2% interest rate support policy.

Presenting an assessment report, Chairman of the NA's Economic Committee Vu Hong Thanh highly appreciated the efforts and drastic, positive, and timely direction of the Government, the Prime Minister as well as the participation of ministries, agencies at central and local levels on implementing Resolution 43.

The implementation has had positive impacts, helping businesses to solve difficulties, supporting production and business, promoting economic recovery, and making important contributions to socio-economic development results in 2022 and 2023.

The results were highly appreciated by voters, and people and recognised by the international community, Thanh said.

He said that in the context of low credit growth in the first nine months of 2023 and slow capital disbursement of the economic recovery programme, the NA’s Economic Committee agreed with the Government's proposal to continue the interest rate support policy.

The committee also agreed to propose the NA extend the disbursement time for development investment capital plans allocated for investment projects of the programme until the end of 2024.

The committee requested the Government to continue to harmonise capital for projects to ensure the efficiency of capital use and enhance investment efficiency.

Photovoltaic cell technology factory put into operation in Quang Ninh

A kick-off ceremony for the Jinko Solar PV Vietnam photovoltaic cell technology project was recently held at Song Khoai Industrial Park in the northern of Quang Ninh province.

Jinko Solar PV Vietnam photovoltaic cell technology project boasts a total investment capital of over US$750 million.

After coming into operation, the project will generate a revenue of over VND100,000 billion per year whilst simultaneously creating jobs for about 4,500 workers with a monthly average salary of about VND13 million per person.

In addition, after the preferential period, the project will alo contribute over VND1,400 billion annually to the state budget.

The Jinko Solar PV Vietnam photovoltaic cell technology project’s coming into operation has also contributed to completing the large-scale solar panel production chain of Jinko Solar Group in Quang Ninh province.

Tran Kinh Vi, general director of Global Operations at Jinko Solar Group, emphasised that through the project, Quang Ninh has become a locality that plays a crucial role in the group’s production lines on a global scale.

At present, factories operating in Quang Ninh account for about 50% of the group's total production output abroad.

As part of the occasion, Quang Ninh has also granted an investment registration certificate of the Jinko Solar Hai Ha photovoltaic cell technology complex project to Jinko Solar Industry Co., Ltd. Vietnam with a total investment of US$1.5 billion.

Long An, RoK enterprises seek cooperation opportunities

Enterprises from the southern province of Long An and the Republic of Korea (RoK) on October 23 joined an investment promotion workshop in Seoul.

Speaking at the event, Secretary of the provincial Party Committee Nguyen Van Duoc said Long An has signed cooperation agreements and memorandums of understanding on economic - cultural - social development cooperation with Korean localities including South Chungcheong province, North Jeolla, and Yangsan city of South Gyeongsang province.

The province wishes and is ready to cooperate with Korean investors in such fields as high technology, supporting industries, manufacturing and processing, automobile assembly, automobile component production, smart ecological urban areas development, seaport services, import-export services, logistics, renewable energy, agricultural product export, high-tech agriculture, and high-tech agriculture model combined with eco-tourism.

Meanwhile, Korean businesses expressed their interest in investment opportunities in Long An province, and briefed participants on their strengths and areas of interest as well as their plans to expand investment cooperation in Vietnam in general and Long An province in particular.

Currently, Korean investors have 207 projects in Long An province, with a combined investment capital of over 960 million USD, accounting for 9% of total foreign direct investment (FDI) in the province, ranking 2nd in the number of projects and 3rd in terms of investment capital.

Long An is among the 10 localities with the biggest FDI attraction in Vietnam.

China biggest buyer of agro-forestry-fishery products from Vietnam

Among the three markets that purchase the most agricultural products from the nation, China currently takes the top spot with US$8.7 billion during the initial nine months of the year, according to the Ministry of Agriculture and Rural Development (MARD).
During the reviewed period, the total export turnover of the entire agricultural sector stood at an estimated US$38.48 billion, down 5.1% over the same period from last year.

hina, the United States, and Japan continue to be the three largest export markets of Vietnamese agro-forestry-fishery products.

owever, export turnover to the US market fell sharply by 22.6% over the same period from last year, accounting for only 20.7% of the total export turnover of this industry during the past nine months.

Exports to Japan also dropped by 7.7%, making up 7.6% of the country’s total turnover.

Only the Chinese market recorded positive growth in terms of export turnover. By the end of September, exports to this vast market had reached US$8.71 billion, an increase of 16.7% on-year, constituting 22.1% of the nation’s agro-forestry-fishery export value.

ost notably, throughout the reviewed period, fruit and vegetable exports hit US$4.2 billion, representing an annual rise of nearly 72%. In particular, fruit and vegetable exports to the Chinese market raked in US$2.75 billion, an increase of 161.8% over the same period from last year.

Along with fruit, China also spent US$495.8 million on buying Vietnamese rice, an increase of 55.2% on-year.

Similarly, exports of cashew nuts, coffee, animal feed, and raw materials to the Chinese market all recorded growth during the nine-month period.

Dang Phuc Nguyen, general secretary of the Vietnam Fruit and Vegetable Association, attributed the strong growth in export turnover to the signing of many major fruit and vegetable export protocols.

For example, after signing the protocol durian export orders witnessed a boom with turnover hitting a record high, thereby turning durian into a billion-dollar fruit in Vietnam.

Sharing the same opinion on this issue, Nguyen Minh Tien, director of the Center for Agricultural Trade Promotion under the MARD, stated that agricultural exports have decreased mainly in the two markets of the US and the EU with two main groups, including wood, forest and aquatic products.

One positive aspect is that in early in the year China reopened its borders after the COVID-19 pandemic, thereby enabling agricultural exports to the northern neighbour to return to growth.

The Chinese market is partly helping to ease difficulties faced by Vietnamese agricultural exports, especially fruit and rice.

To promote the export of agro-forestry-fishery products to this market,  Ngo Xuan Nam, deputy director of the National Notification Office and Inquiry Point on Sanitary Epidemiology and Animal and Plant Quarantine (SPS Vietnam Office), stressed that it is necessary to improve the infrastructure system to serve export activities in the direction of joint investment by the state and businesses in order to increase the capacity. This will therefore provide logistics services and preserve goods from production areas to warehouses, as well as forming agricultural product supply hubs in border gate areas with China.

This is in addition to enhancing the application of science and technology, high technology, and digital transformation to increase efficiency whilst reducing costs in the agro-forestry-fishery export chain to China, he added.

Experts propose development direction for rare earth industry

Vietnam has the world's second-largest reserves of rare earths - an estimated 22 million tonnes - yet the resources have remained untapped, scientists have said.

Development directions for the industry were discussed by scientists at a recent symposium held in Hanoi by the Vietnam Academy of Science and Technology (VAST) and the Ministry of Science and Technology.

They suggested developing the processing of special high-value elements such as Pr and Nd, and building research and transfer centres to master core technology in extractive metallurgy.

VAST President Prof. Chau Van Minh pointed out that with the current technology, Vietnam is unable to mine and process rare earths, as so far countries do not transfer technology in the field. 

According to research studies, Vietnam’s rare earth mines are mainly concentrated in its northwestern provinces of Lao Cai, Yen Bai and Lai Chau.
 
The Prime Minister on July 18 issued a decision approving a master plan on the exploration, exploitation, processing and use of minerals for 2021-2030 with a vision towards 2050, which targets harmony, efficiency and sustainability in the rare earth industry.

Professor Nguyen Quang Liem, former Director of the Institute of Materials Science under the VAST, said it is necessary to launch projects and build laboratories to improve research capacity, as well as exploitation and processing technology, focusing on intensive processing and utilisation of rare earths for industrial products with high economic values.

Rare earths are being used to produce wind turbines and magnets, and serve renewable energy and green transportation sectors, he said, stressing that the global demand for rare earths is expected to double by 2030 and quadruple by 2050.

He also pointed to environmental impacts from rare earth exploitation and suggested more research on this issue.

The conference looked into cooperation between businesses and scientists in research in order to raise the efficiency of rare earth exploitation and processing, thus fostering the industry in Vietnam.

AI development fuels digital transformation initiatives for Vietnam’s businesses

 Tech giants and startups in Vietnam are intensifying AI investments, fostering innovative business models to benefit user significantly.

Cho Tot, a part of the Carousell Group and a multi-category platform for secondhand goods in Greater Southeast Asia, is among the technology companies in Vietnam that are currently experimenting with and applying AI to develop their products and services, aiming to provide users with convenience quickly and effectively.

Thien Pham, Cho Tot’s Senior Data Manager, introduced the "Smart Listing" feature powered by Generative AI technology for the car listing website at the Google Gen AI Cloud Summit 2023 event held last week in Singapore. Thanks to the support of Google Cloud's AI application testing, this new feature allows sellers to complete a listing in less than 1 minute, as opposed to the previous 15 minutes. Sellers simply need to take photos of the car, upload the images, and post the listing after verifying the automatically generated information.

Thien explained that selling used cars on online platforms is typically a complex and time-consuming process. Sellers usually spend 10 to 15 minutes filling in-vehicle information and specifications, pricing the car compared to the market, and creating compelling sales content, including headlines and detailed descriptions to attract buyers.

With the new feature, users can simply take photos of the car and upload them to the Cho Tot platform. The feature scans the images and automatically populates all the fields, eliminating the need for manual data input. This is made possible through the application of AI technology combined with data from Cho Tot's extensive data repository.

Thien mentioned that Vietnam is currently Carousell Group's strategic automobile market, with a growth rate of 35% from 2019 to 2022. The growing new automobile market has led to a used car market with over 10 million users nationwide during this growth phase.

The potential for development in the market is enormous, as the ratio of used cars to new cars sold in Vietnam is only about 0.5, much lower than the 1.2 figure for the entire Southeast Asia region, according to Mordor Intelligence.

"These efforts aim to improve the experience of listing cars and increase liquidity in the secondary automobile market. Buyers have more quality options with complete and accurate information, thereby enhancing Cho Tot’s competitive advantage in the market," Thien emphasized.

"Cho Tot, as a pioneer in applying technology and AI, has been chosen by Google Cloud to test the application of Gen AI models in the development of its products. Thien mentioned that the strong support from companies like Google, which provides AI application platforms, encourages businesses to quickly adopt AI applications and expand globally," he added.

Nguyen Duc Toan, Country Manager of Google Cloud in Vietnam, who is directly involved in projects supporting businesses like Cho Tot, shared that Google aims to contribute to and support the development of AI applications in Vietnam.

"AI, and Gen AI in particular, will have a profound impact on communities and commerce," he said. "By offering our latest skills development training options, AI models, developer-friendly tools, and startup support in Vietnam, Google Cloud is reinforcing our commitment to empowering organizations of all sizes to build and deploy their own enterprise-grade Gen AI applications with ease and speed, all while safeguarding their data and users."

"At this time, I don't see any difficulties with the policy mechanism; instead, any challenges mainly arise from enterprises actively embracing change and implementation. Those who swiftly adopt this technology are the ones experiencing its effectiveness, leading to increased productivity and rapid integration into their business processes," he told The Hanoi Times.

He underlined that Vietnam is embracing the direction of national digital transformation, focusing on Industry 4.0, which encompasses big data and AI. Google plays a key role in supporting AI development in Vietnam by offering cutting-edge technologies and prioritizing businesses and the government.

Vietnamese is a preferred language for Google's research and product development. Additionally, the Google for AI Startups Cloud program supports businesses with AI-first products to bring their products to the market, he said.

There is a team directly supporting the Vietnamese market, building various programs for Vietnamese customers who have a demand for applying generative AI in company development, such as human training and process transformation to apply generative AI in e-commerce and retail sectors, according to Toan.

As a partner of Google, Cho Tot will continue to enhance its features to better suit users, expecting a 15-20% increase in the number of listings in the first month after launch. Thien affirmed that Cho Tot will continue to seek solutions to reshape the used car market, aiming for a future where users can transact conveniently, securely, and with satisfaction.

In recent years, the Vietnamese Government has shown a specific orientation in promoting the development of AI applications, including the issuance of the National AI Strategy on research, development, and application of AI until 2030, with the goal of gradually making Vietnam a center of innovation and AI, ranking among the top four in ASEAN and the top 50 in the world.

The guiding perspective of Prime Minister Pham Minh Chinh, presented in early October at the National Digital Transformation Day 2023 with the theme of exploiting digital data to create value, highlights the active support for Vietnamese businesses in transitioning their production and business activities to the digital environment, enhancing international cooperation, seeking and adopting suitable modern models, technologies, and solutions in Vietnam.

Da Nang promotes tourism in Philippines for first time

The central city of Da Nang held its first-ever tourism promotion programme in Manila in the Philippines on October 23, with the occasion drawing the participation of 14 Vietnamese travel firms and 150 Filipino businesses.

The highlight of the event is the introduction of direct flights on the Manila-Da Nang air route launched by Filipino airlines Cebu Pacific Air.

Starting from December 7, flights will depart from Manila at 7:30 p.m. (Philippine time) and arrive in Da Nang at 9:30 p.m. (Vietnam time) with a frequency of three flights per week, including Tuesday, Thursday, and Saturday.

According to a representative of Cebu Pacific Air, expanding the air route will help the country lure more tourists from new markets such as the central region of Vietnam.

Throughout the opening seven months of the year, the Philippines attracted more than three million international visitors, with the Republic of Korea, the United States, Australia, Japan, and Canada among the Top 5 markets.

Cebu Pacific Airlines' direct flights are also expected to increase the number of travelers from the Philippines heading to Da Nang city in the near future.

The function is taking place as one part of a series of tourism promotion and tour service programmes from Da Nang which will be held in the Philippines, Malaysia, and Singapore between October and November.

Da Nang is one of the five centrally-run cities with high growth rates in all regards, including in the economy, culture, education, and science and technology.

In August the nation was listed among 15 countries most loved by expats, according to InterNations, the largest global expat network with more than four million members.

This comes after the renowned Travel + Leisure magazine also voted Da Nang among the most ideal destinations and best culinary spots in the world back in February.

Vietnam ready for official coconut exports to Chinese market

The southern province of Ben Tre has made great efforts to further develop organic material zones, as well as improving the coconut production process by applying for growing areas and packaging codes to officially export fresh coconuts to the Chinese market in the future.

At present, the province has built five pilot coconut cultivation areas in line with organic standards. Furthermore, the locality has developed value chains for more than 23,000 hectares of coconut, of which the total area of organic coconut stood at over 18,000 hectares.
  
Meanwhile, 11,600 hectares of coconut met the stringent standards to export to the United States, Japan, and the EU.

Currently, Ben Tre coconut products have made their presence in more than 90 countries and territories worldwide, as well as making inroads into high-standard markets in the Europe, America, and the Middle East.

There are about 20 local businesses registering to participate in developing growing area and packaging facility codes to meet export standards.

Huynh Quang Duc, deputy director of the Department of Agriculture and Rural Development of Ben Tre province, said the Chinese side have highlighted Vietnamese coconut products as they recently conducted a field trip to inspect planting regions and packing facilities of fresh coconuts in the nation.

Apart from improving product quality, Duc underscored the importance of signing the protocols for official export to the market moving forward.

Three Vietnamese resorts win Destination Deluxe Awards

Three local resorts were honoured at Destination Deluxe Awards 2023, with the event recently being held at the Banyan Tree Bangkok in Thailand.

They include Six Senses Ninh Van Bay in the southern central province of Khanh Hoa, along with TIA Wellness Resort and InterContinental Danang Sun Peninsula Resort in the central city of Da Nang.

According to the list, Six Senses Ninh Van Bay surpassed two other well-known reports in Cambodia and the United States to win the “Eco-Hotel of the Year” category.

Coming to the resort, visitors will have the opportunity to experience scuba diving and jungle adventures, with an equal emphasis placed on wellness and relaxation such as soothing spa treatments and flying yoga.

Furthermore, the “Creative Healing Retreat” healthcare programme of TIA Wellness Resort claimed second place in the “Wellness Program of the Year” category.

The programme is designed to alleviate stress or anxiety in guests who feel like their life and emotions have become imbalanced, as well as for those who are keen to improve their wellbeing, by releasing negative feelings and to feel more vibrant and centred.

InterContinental Danang Sun Peninsula Resort grabbed first place in the "Holistic Treatment of the Year" category thanks to its Mi Sol Journey of the resort’s Mi Sol Spa.

Mi Sol Spa is named after the tones in the musical scale, with the tones do, re, mi, fa, sol, la, and ti each having a specific vibration frequency. The spa obtains these different frequencies with the use of tuning forks. Through these vibrations it is able to invoke deep relaxation and emotion. Mi has a frequency at 528 Hz that reinstates equilibrium and stimulates love, whilst sol at 741 Hz cleanses the mind and body from blockages and toxins.

The Destination Deluxe Awards 2023 provides the perfect backdrop for a celebration of the finest in luxury and wellness. In recognition of the industry’s finest across 25 categories, the awards were voted on by a panel of 20 expert judges.

It aims to honour the best spas, treatments, hotels and resorts, retreats, and skincare brands that have exhibited outstanding achievements in luxury standards, innovation, quality, as well as ecological awareness, and prospective contributions to the overall growth of the wellness and travel industries.

Shrimp exports to US enjoy vigorous growth in second half

Vietnamese shrimp exports to the United States continued to witness robust growth in September, representing a year-on-year rise of 23% and marking the third consecutive month of positive growth this year, according to the Vietnam Association of Seafood Exporters and Producers (VASEP).
 
Furthermore, this was also the month that witnessed the highest export growth as shrimp exports to the market in July and August increased by 14% and 11%, respectively.
  
However, shrimp exports to the US during the nine-month period dropped by 23% to reach US$520 million against the same period from last year.

VASEP experts assessed that despite experiencing negative growth to some major markets like the EU, Japan, and the Republic of Korea, there have been positive signs from markets such as the US, Australia, Canada, Belgium, and Taiwan (China), with growth rates ranging between 1% and 54%.

Most notably, after witnessing positive growth in June, July, and August, shrimp exports to China and Hong Kong (China), continued to experience a downward trend of 13% to US$61 million in September, thereby making shrimp exports to this market in the nine-month period decline by 6% to US$454 million on-year.

According to figures released by experts, with bright prospects in markets such as the US, Canada, and Australia, the demand for processed shrimp tends to increase during the year-end period.

Moreover, with shrimp imports into the US increasing in recent times due to stable consumer spending coupled with the positive US growth projection by the International Monetary Fund (IMF), there will be a positive outlook for shrimp exports to the market moving forward.

Central bank forecast to continually issue bills amid abundant liquidity

The State Bank of Vietnam (SBV) will continually issue new bills to withdraw cash from the banking system in the context that liquidity is abundant and interbank interest rates remain low, analysts forecast.

The SBV last month issued more than VNĐ110 trillion of 28-day bills, and the bills will mature this month. As a result, a corresponding amount of cash will be pumped back into the banking system if the SBV does not issue new bills. However, given that interbank interest rates are still low, KB Vietnam Securities Joint Stock Company (KBSV)’s analysts believe the SBV will continue to issue new bills to replace those that are maturing.

They explained that the move will be made as the overnight interbank interest rate returns to very low levels while the interbank foreign exchange rate and the interest rate gap between US dollar-denominated deposits and Vietnamese đồng-denominated deposits remain high. This will stimulate dollar speculation and put pressure on the foreign exchange rate.

KBSV’s analysts do not rule out the possibility that the SBV might even increase the size and term of bills to be issued in the coming time.

In fact, in recent sessions, the SBV has moved to increase cash withdrawal through bill issuance. In the first nine trading sessions in early October, the SBV issued bills worth less than VNĐ10 trillion each, but from October 12, 2023, to October 16, 2023, the SBV increased it to VNĐ20 trillion each. Even on October 17, 2023, the bill value reached VNĐ17.95 trillion and VNĐ12.05 trillion the following day.

In the latest five trading sessions, the SBV withdrew VNĐ90 trillion, marking the strongest net withdrawal series since the bill issuance channel resumed operations on September 21. At the same time, the winning interest rate also remained at a high level of 0.9-1 per cent, indicating a more aggressive stance from the SBV in withdrawing cash.

KBSV’s analysts have outlined three scenarios for the SBV’s bill issue, corresponding to different foreign exchange rate zones.

According to the first scenario, if the foreign exchange rate remains stable at around VNĐ24,000 to VNĐ24,400 per US dollar, the SBV will likely issue an average volume of bills worth about VNĐ12 trillion per session.

In the event the exchange rate surpasses the threshold of VNĐ24,500 per dollar, the SBV will issue an average volume of VNĐ20 trillion per session until the exchange rate displays clearer signs of stabilisation.

In the third scenario, should the dollar exchange rate near the VNĐ25,000 mark, KBSV does not dismiss the possibility that the SBV will opt to sell the dollar forward to stabilise the exchange rate.

Dr. Trần Ngọc Thơ from HCM City University of Economics suggests that to circumvent the cycle of withdrawing money every 28 days and then reinjecting it, which might create negative market sentiment, the SBV could issue bills with longer terms, either monthly or annually.

However, the issuance of long-term bills requires stringent regulations and collaboration between the Ministry of Finance (MoF) and the SBV, as the MoF’s State Treasury also issues bills.

The SBV recommenced the money withdrawal channel via bill issue on September 21 this year after over six months of hiatus. With 20 consecutive sessions of issuing bills, the SBV has extracted nearly VNĐ255.7 trillion from the banking system.

Explaining the rationale behind resuming the bill issuance channel, SBV’s deputy governor, Phạm Thanh Hà, highlighted that recently, the SBV has had to issue short-term bills to diminish excess liquidity in the banking system. This strategy aims to limit significant disruptions to the interest rate level. Presently, interest rates in the interbank market remain steady, but there will be substantial pressure in the foreseeable future as Việt Nam endeavours to harmonise interest and foreign exchange rates.

According to Hà, the SBV is vigilantly observing the foreign currency market and striving to maintain a stable exchange rate. Nevertheless, Hà acknowledged the intricacy of the SBV's task, given the intricate relationship between interest rates and foreign exchange rates.

Concurrently, after a minor dip earlier this month, the dollar exchange rate in the banking market has made a comeback, currently trading at its zenith since the start of the year. On October 19, the dollar rate at commercial banks saw a significant surge, notably exceeding the VNĐ24,700 threshold. Specifically, Vietcombank – the institution with the most substantial foreign currency transactions in the banking system – set the dollar buying and selling rates at VNĐ24,370 and VNĐ24,740, respectively, a rise of VNĐ125 compared to the prior weekend.

Thus, from early October to the present day, the dollar exchange rate at commercial banks has ascended by roughly VNĐ280, equivalent to a surge of over 1.1 per cent. The rate has, to this point in the year, climbed by VNĐ1,000, or in excess of 4.2 per cent.

Given the possibility that the US Federal Reserve (Fed) might further elevate interest rates towards the year's end, these exchange rate trends are exerting definite pressure on the SBV's administrative duties, including open market operations (OMO).

PM applauds investment expansion by John Swire & Sons

Prime Minister Pham Minh Chinh received Chairman of John Swire & Sons Limited Guy Bradley in Hanoi on October 24, welcoming the UK-headquartered firm’s continuous expansion of investment and business activities in Vietnam.

He called on the over-200-year Swire Group to continue expanding its operations in such sectors as aviation, trade and industry, logistics, real estate, health care, and the production, distribution and retail network in Vietnam; develop human resources, especially high-quality ones; and consider cooperating with local universities and vocational schools.

Chinh asked the group to increase applying the latest scientific and technological advances to its activities; improve the added value and the rate of domestically made components in its products and use supporting technologies of Vietnam; boost assistance for Vietnamese businesses to join its supply chain; effectively use renewable energy; and harmonise economic targets with social responsibility fulfillment, thereby helping Vietnam achieve green growth and sustainable development targets and effectively respond to climate change.

Bradley introduced his firm and its long-term plan in Vietnam, highlighting its commitments to sustainable development, green growth, and circular economy promotion.

Swire Group has operated in Vietnam since 1988 via activities supporting oil and gas, tea, aviation, and real estate companies. In January 2023, its subsidiary Swire Coca-Cola Limited purchased Coca-Cola Beverages Vietnam Co. Ltd, the bottling partner of Coca-Cola in the country. Thanks to that, it has created over 2,000 direct jobs and 20,000 indirect ones in Vietnam, he noted.

He spoke highly of the increasingly improved investment and business climate in Vietnam and expressed his belief in the success of his group’s operations here.

The group is highly committed to Vietnam and will keep expanding its investments, especially in the fields of aviation and health care, to contribute more local socio-economic development, Bradley remarked.

Welcoming the firm’s intentions, Chinh affirmed that the Vietnamese Government always supports and protects the rights and legitimate interests of foreign investors on the basis of interest harmonisation and risk sharing, adding the country considers foreign businesses’ success as its own.

FPT Techday 2023 officially kicks off

FPT Techday 2023 has officially kicked off on Tuesday (October 24) in Hà Nội. The event is an annual technology forum held in Việt Nam, focusing on chip technology and artificial intelligence (AI).

The 2023 edition of FPT Techday with the theme "35 years of Creating Happiness" takes place from October 24 to 25.

The event is expected to attract over 10,000 visitors, including more than 2,500 technology experts, digital transformation experts and business owners from various countries around the world.

FPT group, the organiser of FPT Techday 2023, aimed to showcase its position and national reputation on the global digital map through the event. It provided a platform for the global technology community to come together and introduced international initiatives and AI solutions that are shaping the future.

During the event, FPT group presented a series of business and technology strategies to meet the needs of its global customers and enhance its service capabilities for its existing customer base of more than 50 million. One of the notable announcements was the launch of Happy Club, a membership ecosystem based on the digital platform 5.0 - DC5, which was researched and developed by FPT group itself.

In addition to FPT's activities, 11 international partners of FPT, including Schaeffler, Konica, AFLAC, SC Ventures, Olympus and Landing AI, showcased their platforms and technology products resulting from collaborations and research and development efforts with FPT. These achievements highlighted FPT's global technological endeavours and solidified its position in the international tech landscape. FPT also signed several memorandums of understanding with global companies to further its international technology leadership.

One significant partnership announced at FPT Techday was the collaboration between FPT and Landing AI. Landing AI is a leading American software company specialising in computer vision and AI, founded by Andrew Ng, a renowned figure in the field of AI and co-founder of Coursera. FPT and Landing AI signed a strategic cooperation agreement to develop business and human resources in the field of AI. This collaboration is expected to contribute to the advancement of AI in Việt Nam, the United States and worldwide.

FPT Group signed a memorandum of understanding with Toppan Group regarding the licensing and cross-selling of Metaverse-related technology. This partnership aimed to promote joint sales targeting Japanese corporate customers and to explore potential cooperation in games and entertainment in Asia. Another strategic cooperation was established between FPT Information System, a member company of FPT Group, and TradeWaltz, Japan's leading trade platform. The collaboration aimed to enhance international trade between Việt Nam and Japan.

FPT Techday 2023 showcased FPT's technological achievements, international partnerships, and its commitment to driving innovation and digital transformation in Việt Nam and globally.

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