VIETNAM BUSINESS NEWS OCTOBER 3
Of the amount, 348 million USD was poured into 567 new projects, down 7.6 percent in value compared to the same period last year.
Singapore was the biggest investor in the southern hub with 97 new projects totaling 121.8 million USD, accounting for 35% of the total newly-registered capital. It was followed by Japan and the Republic of Korea with 60 and 81 projects worth 60.2 million USD and 47.1 million USD, respectively.
Meanwhile, nearly 1.49 billion USD was added to 114 existing projects, 2.5 times higher than the same period last year.
Besides, there were 1,797 approved transactions of capital contribution and share purchases by foreign investors in the period with a total value reaching nearly 1.13 billion USD, down 16.2% year-on-year.
Vietnam-Canada Business Association debuts
The Vietnam-Canada Business (VCB) Association made its debut during a congress held in Vancouver, Canada on October 1.
The establishment of the VCB Association took place in the context that the comprehensive partnership between Vietnam and Canada has made impressive strides, with a 5-year milestone this year.
The two countries are also looking forward to celebrating the 50th anniversary of their diplomatic relations in 2023.
Despite suffering the negative impacts of the COVID-19 pandemic last year, the two-way trade turnover between Vietnam and Canada still reached more than CAD10 billion, of which the value of trade between Vietnam and the province of British Columbia hit CAD 2.5 billion.
The establishment of VCB Association comes from the desire to meet, connect and support each other in trade and investment of the two countries' businesses.
Construction starts on Long Thanh airport’s flight management works
Work has started on the flight management works at Long Thành International Airport Project in the southern province of Đồng Nai.
These are large-scale infrastructure works with the most complex technology ever used by the Vietnam Air Traffic Management Corporation (VATM).
The component project has a total investment of nearly VNĐ3.5 trillion (US$147.3 million). Its works include an air traffic control tower and supporting items, primary/secondary surveillance radar stations and VHF radio base stations, weather surveillance radar, and automated weather observing system (AWOS).
Covering a total area of more than 5,580 hectares, the Long Thành International Airport will spread across six communes in Long Thành District in Đồng Nai Province. The airport’s total investment is VNĐ336.63 trillion, with construction divided into three phases.
In the first phase, a runway and one passenger terminal, along with other supporting facilities, will be built at the cost of VNĐ109.112 trillion to serve 25 million passengers and 1.2 million tonnes of cargo each year.
The project started in 2021. Once fully completed by 2050, the airport will be able to handle 100 million passengers and five million tonnes of cargo annually.
Located 40km east of HCM City, the airport is expected to ease the overload at Tân Sơn Nhất international airport in the southern metropolis, now the country’s largest airport.
Gwangju businesses and Vietnamese importers seek trade opportunities
A business-to-business (B2B) trade event was organised last week to connect companies from Gwangju – the sixth-largest metropolis of the Republic of Korea (RoK) – and Vietnamese importers.
During the five-day event held by the Korea Trade and Investment Promotion Agency (KOTRA Hanoi), Gwangju businesses introduced their products of strength, including cosmetics, food and medical supplies.
Lee Dahye from Unique Medicare Co Ltd said such event offers a good chance for Korean firms, especially those that have never exported to foreign countries, to explore information about foreign partners.
KOTRA Hanoi has been employing online trade promotion events thoroughly to strengthen trade connection between the RoK and Viet Nam.
Head of KOTRA Hanoi’s office Tran Thi Hai Yen said as of mid-September, KOTRA had carried out 58 online events connecting 850 RoK businesses with nearly 900 Vietnamese importers.
The agency will continue to organise more events of this kind by the end of this year, aiming to connect 1,300 Korean enterprises and over 1,200 Vietnamese partners, helping lift the two-way trade between Viet Nam and the RoK to US$100 billion in the year.
VinFast to deliver first Evo200 e-scooters to customers
Vietnamese e-vehicle maker VinFast will deliver the first batch of its new electric scooter, Evo200, to customers in northern Hai Phong city on September 29.
Evo200, which was announced in April this year, can travel more than 200km after each full charge. It has a price tag of VND22 million (US$925) each.
According to VinFast, after 48 hours of opening sales of the bike on September 21, the firm received more than 18,000 orders for two models of Evo200 and Evo200 Lite.
VinFast Evo200 is the only brand-new two-wheeler the brand will launch in 2022 alongside four upgrades to Feliz S, Klara S (2022), Vento S, and Theon S.
Suspicion over Hoang Anh Gia Lai Group's long-term growth trajectory
Since exiting the real estate segment in 2012, privately-held Hoang Anh Gia Lai Group (HAGL) has continually been pivoting to the agriculture business. However, the business efficiency of the fresh approach remains vague.
In light of the company’s fresh trajectory, next year HAGL would launch into the market with around 1,000 stores selling pork products from banana-eating pigs, of which franchised stores are accounting for 80 per cent.
Since the economic downturn back in 2008, Vietnam’s real estate market weathered stormy times. In late 2012, HAGL chairman Doan Nguyen Duc took a breakthrough decision of pivoting from real estate to planting rubber.
By 2012, the company posted revenue touching $159.4 million from real estate, construction, and mineral sale segments, making up 83 per cent of its total revenue. Thus, albeit these segments proved their core line, the company decided to pivot to a new area.
By 2014, its revenue witnessed a change with agricultural products such as sugar, corn, and rubber, contributing $64 million or 48 per cent of total revenue.
The company’s captain Duc noted that HAGL’s development has stepped into a new chapter.
To underpin the change, in 2012, HAGL injected $100 million into growing sugarcane and expedited a string of rubber planting projects.
In 2014, HAGL made its debut in the husbandry field, working on cow-raising strategies in Vietnam, Laos, and Cambodia.
In 2016, cow raising generated the company $150.6 million, representing 54 per cent of total revenue while sugarcane, corn, and rubber just contributed $31.2 million, accounting for only 11 per cent of total revenue.
As the revenue from cow raising had shown signs of a slide, chairman Dao Nguyen Duc shifted into fruit trees holding high expectations with passion fruit, red dragon fruit, and banana planting.
In 2017, following the shift into an agricultural firm growing fruit trees, HAGL once expected that passion fruits could bring exceptional growth and help the company to break into the Chinese market.
In 2018, HAGL’s revenue sum from fruits reached $126 million, making up 53.8 per cent of total revenue. By contrast, revenue from raising cows only contributed $5.5 million, equaling 2 per cent of total revenue.
By 2020, HAGL counted $99.26 million in revenue from fruit sales, making up 71.9 per cent of total revenue but down 21.2 per cent compared to 2018’s level. The revenue from cow raising was not mentioned.
In the first six months of this year, the company’s revenue structure once against saw a conversion in which pig sales contributed $19.7 million, representing 22.3 per cent of total revenue, and fruit sale sum further fell to $45 million, equal to 51 per cent of total revenue.
HAGL shifted to raising pigs, and the company’s captain Duc noted that HAGL’s development has stepped into a new chapter.
Duc also said that he lost sleep after finding the recipe for raising pigs with bananas which helps pigs to grow quickly.
As of June 30, HAGL, however, just reportedly possessed $5.1 million in equity, equal to 0.61 per cent of its total asset value, meanwhile, its debt payment obligation stood high at $392 million, accounting for 46.8 per cent of the company’s total capital sources.
Along with that, HAGL’s core business line has yet to generate profit. In the first half of this year, it incurred $5.9 million in losses, compared to the loss amount reaching $76.6 million in 2020 and $27.8 million in 2021.
HCM City’s nine-month budget revenue soars
Ho Chi Minh City has collected more than 349.9 trillion VND (14.64 billion USD) in State budget revenue in the first nine months of this year, up 27.7% year-on-year, on the back of soaring revenue from real estate and crude oil, according to data from the municipal statistics office.
The amount was equivalent to 90.5% of the yearly plan.
From January to September, domestic collection surged 26.3% against the same period last year to exceed 222 trillion VND while that from foreign trade went up 19.7% to close to 104.74 trillion VND, accounting for 63.5% and 29.9%, respectively, of the total.
Nine-month budget revenue from crude oil exports reached over 23.11 trillion VND, up 116% year-on-year and 20% higher than the year’s plan. It made up 6.6% of the total.
Collection from the real estate sector spurred 152.3% year-on-year thanks to the market vibrancy in the early months of the year.
The southern hub posted a Gross Regional Domestic Products (GRDP) growth of 9.71% during the period, given that the local economy has been witnessing a strong recovery with the GRDP growth hitting more than 30% in the last quarter.
Yet, HCM City was among the country’s worst performers in public investment disbursement since the disbursement rate only reached 25% of the yearly plan, prompting the city to double efforts to tackle the issues and accelerate the progress.
Seafood exporters tasked with improving their game
Amid high inflation and the devaluation of the Euro, tie-ups with the European continent are providing an opportunity for fisheries to be more active in sustainable development and up their game when it comes to the agreed rules of origin on seafood exports to the EU market.
Vietnam’s seafood exports in 2022 could reach $10 billion with the contribution of signed trade deals. The zero-tariff advantage from Vietnam’s agreement with the EU (EVFTA) is rendering Vietnam’s seafood prices more competitive in the bloc, but it entails the challenge of implementing regulations on the origin of seafood input materials.
Over time, the EU has gradually tightened the rules on socially and environmentally-responsible production practices for imported seafood. For instance, the most important part of the new EU organic farming regulation is that producers from developing countries must comply with the same set of rules as European ones. The EU wants to ensure that all organic products sold in its territory are of the same standard.
The European Commission (EC) in March further presented an action plan for the development of organic production with the aim to promote the production and consumption of organic products, including organic aquaculture. The action plan is also designed to drive demand, maintain consumer confidence, and bring organic food closer to the nearly 600 million people in the market.
However, meeting the rules of origin will be more difficult. The EC started applying a new maximum mercury residue threshold on May 3, stipulating that mercury residues in seafood can range from 0.3-1 microgramme per kg, depending on the product type. Products already on the market will be consumed until their respective expiry date.
Truong Dinh Hoe, general secretary of the Vietnam Association of Seafood Exporters and Producers (VASEP), said, “Implementing the rules of origin of goods has many problems. Similar to most rules of origin in other trade deals, the EVFTA requires that seafood materials used for semi-processed or processed seafood must be raised, harvested, or caught in Vietnam, or alternatively originate from the EU. For example, for caught seafood, especially tuna, more than four-fifths of raw materials must be imported from countries and territories that do not have FTAs with Vietnam.
According to the VASEP, the EU is a large market with many market segments and products. Over the past 10 years, Vietnam’s seafood production has increased steadily from 4.9 million tonnes in 2009 to 8.7 million tonnes in 2021. Vasep believes that Europeans are increasingly preferring products with white fish because of health factors, while the awareness of environmental protection and seafood resources also raises, offering opportunities for farmed fish for export.
Gen Z demand flexible, digital-led work environment
People under 25 are more likely to change their jobs, have higher expectations of their employers, and demand more flexibility, according to recent surveys.
An Anphabe survey reported in June stated that 62 per cent of Generation Z in Vietnam switch jobs within the first year, which poses difficult problems for recruiters.
The younger generation like to work in a virtual reality environment, so businesses should build digital workplaces to help improve the employee experience and attract and retain talent.
Since the pandemic, favoured work patterns have changed, even for non-Gen Z workers, with 89 per cent of employees in Vietnam saying the ability to work from anywhere has made them happier and 76 per cent saying they want a combination of a remote and in-office hybrid working model in the future, according to a survey in May of over 1,000 people in Vietnam by IT conglomerate Cisco.
The change in interests and working habits has led to a shift in human resource needs between industries. Businesses operating in fields related to technology, retail, or environments with flexible working hours have become more attractive than the remaining traditional companies.
In just half a year, Mobile World was able to recruit more than 8,000 employees, not to mention thousands of freelancers, as it is seen as a modern, dynamic company. As of June, the number of its employees reached 78,600 and continues to grow.
FPT is an enterprise with a solid rate of staff expansion and a working environment appreciated by young workers for its dynamism, creativity, and flexibility. The number of FPT employees has increased by 2,100 in the last six months, bringing the total number of employees to over 39,000.
In contrast to industries with flexible working conditions, which the younger generation prefers, labour-intensive sectors such as textiles and garments, construction, and banking saw a decline in employee numbers, with young people in particular not keen to join them.
According to the General Statistics Office, by 2025, Gen Z is expected to take up 30 per cent of Vietnam’s workforce.
Investors remain determined to develop thermal power plants
The Ministry of Industry and Trade (MoIT) has reviewed the list of thermal power plant projects to report to the government, which is a requirement for approving the Power Development Plan VIII.
At present, five projects are in the preparation process but the investors reported that they face many difficulties. Four projects have foreign capital namely Song Hau 2, Nam Dinh 1, Vinh Tan 3, and Quang Trị 1, while Cong Thanh is invested by a local investor.
At the Vinh Tan 3 thermal power plant, its investors involve Vietnam Electricity, Pacific Group, and OneEnergy Asia Ltd., a partnership of Hong Kong’s CLP Holdings and Japan’s Mitsubishi Group.
In February this year, Mitsubishi withdrew from the Vinh Tan 3 thermal power plant in the central province of Binh Thuan due to increasing global concerns about climate change.
At the Nam Dinh 1 thermal power plant, in July 2017, a consortium of Saudi Arabian ACWA Power and South Korean Taekwang Power Holdings Co., Ltd. officially received an investment certificate for the $2.3-billion Nam Dinh 1 thermal power project. However, ACWA Power withdrew from the project.
The Quang Tri 1 thermal power plant, which is invested by EGAT International Co., Ltd. (EGATi), has the total investment capital of $2.39 billion. In November 2019, EGATi kicked off the construction of the plant; however, the construction has yet to be implemented because the investor is waiting for the approval of the Thai government to invest overseas.
The $3.5 billion Song Hau Coal-fired power plant II is invested by Toyo Ink Group. The project's construction is expected to commence in 2023. At present, the investor is delaying paying fees for land clearance and compensation costs due to difficulties in arranging capital.
The remaining project is the Cong Thanh thermal power plant, which is invested by the Cong Thanh Thermal Power JSC. The investor is face difficulties in mobilising capital.
According to MoIT, despite problems, the investors remain determined to develop these projects.
Currently, there are 39 thermal power plants in operation. Several projects are now under construction, such as Thai Binh 2, Long Phu 1, Quang Trach 1, Van Phong 1, Vung Ang 2, An Khanh, and Na Duong 2.
Tra catfish exports to the UK expected to rise 30 per cent in 2022
Viet Nam's tra catfish exports to the UK are expected to reach US$67 million in 2022, increasing 30 per cent from last year, thanks to spectacular growth in recent months.
According to the Viet Nam Association of Seafood Exporters and Producers (VASEP), the UK is in the top 10 seafood import markets of Viet Nam, accounting for 3 per cent of seafood export value. In the first eight months of 2022, seafood exports to the UK increased by 3.5 per cent to $213 million. Of which, the tra exports to the market soared by 28 per cent to $47 million in the eight-month period. The frozen tra fillets accounted for 79 per cent, processed tra 17 per cent, and whole tra 4 per cent.
Alone in August, tra exports to the UK market increased three-fold over the same month last year, reaching over $7 million.
Inflation in the UK is at a 40-year record high and is almost the highest in European countries. The rising energy and raw materials costs are causing “heavy and lasting damage” to the fish-and-chip industry.
According to a recent survey of 410 members of the National Federation of Fish Friers (NFFF), gas and electricity prices have increased by 300-500 per cent. Europe's energy crisis worsened after Russia stopped the flow of gas via the Nord Stream 1 pipeline to the continent.
On September 5, the price of gas in the UK increased by 35 per cent, causing even more difficulties for fish-and-chip shops in the UK. They were put under great pressure when the prices of cod and haddock as well as other input costs such as potatoes and sunflower oil increased.
Therefore, the consumption of high-priced food items is limited. As a result, exports of shrimp, tuna and some marine fish species to the UK dropped sharply.
Meanwhile, tra exports still maintained growth because of the moderate price. Moreover, the UK has a shortage of white fish due to the seafood ban from Russia, making tra a substitute fish in the UK market.
VASEP forecast that with the current favourable growth momentum, tra exports to the UK in the remaining months of the year are showing more positive signs.
BT contract for HCMC’s infrastructure project canceled
HCMC has decided to suspend the build-transfer (BT) contract for the Binh Tien road and bridge project over legal concerns.
The HCMC chairman, Phan Van Mai, made this decision on September 12, following the HCMC Department of Planning and Investment’s proposal.
The Department of Transport and the relevant agencies were tasked with studying and suggesting another investment format for the project.
The Binh Tien road and bridge project will be 3.2 kilometers long, with the bridge having a total length of over 900 meters. The project will link the Binh Tien-Pham Van Chi intersection in District 6, Vo Van Kiet Avenue, the Tau Hu and Doi canals in District 8 and Nguyen Van Linh Street in Binh Chanh District.
The prime minister authorized HCMC to choose an investor to develop the project under the BT format 12 years ago. The city then approved the investment of the project at VND2.4 trillion, but work on the project had yet to begin due to financial woes linked to site clearance and land issues.
In 2016, the city proposed the prime minister divide the project into two components. Of them, one 1.4-kilometer section will run from Pham Van Chi Street to Ta Quang Buu Street and require VND1,853 billion. The other one, which will be 1.8 kilometers long, will link Ta Quang Buu with Nguyen Van Linh, with total estimated capital of VND750 million.
However, in early 2018, after the central Government ordered the suspension of BT projects, HCMC decided to halt their execution.
Vietnam importers advised to re-negotiate with India over rice purchases
Vietnam’s Trade Office in India has urged Vietnamese rice importers to contact their Indian sellers to check the status of delivery and re-negotiate with their partners over rice purchases, as India has imposed restrictions on rice exports.
The Trade Office said on September 8 that India had banned exports of broken rice and imposed a 20% duty on the export of some types of rice. The ban took effect on September 9.
However, some shipments will still be exported until September 15 if they meet one of the following conditions: rice had been loaded on ships before the ban, an invoice had been issued and a rice-carrying ship has arrived in India, or rice had been referenced to the customs for checks and export registration.
In 2021, Vietnam imported 433,000 tons of rice from India.
India’s restrictions on rice exports have sent the Asian rice price up 5%. The rice price is expected to continue to rise, the local media reported.
Viet Nam makes tremendous progress in innovation, science, technology
Viet Nam has made tremendous progress in innovation, science, and technology, reiterated Ramla Khalidi, UNDP Resident Representative Designate in Viet Nam.
Ramla Khalidi made the above statement while attending the conference on the development of synchronous, effective, modern and integrated science and technology market in Viet Nam, which took place in Ha Noi on September 23.
According to the 2021 WIPO Global Innovation Index, the nation leads the group of lower middle-income countries, ranking 44 out of 132 countries with more than 18,500 scientific and technological discoveries, noted the UNDP Resident Representative Designate in Viet Nam.
Viet Nam aspires to become an upper middle-income country with a modern industrial base by 2030, and a high-income developed country by 2045. Science and technology are central to this vision as catalysts for a prosperous, knowledge-based economy.
Since the Doi Moi reforms were implemented in 1986, the country achieved rapid and sustained economic growth, at an average of 7 percent.
New firms set up in 9 months up nearly 32%
As many as 112,791 firms were established over the last nine months of 2022, a year-on-year increase of 31.9 percent, announced the Ministry of Planning and Investment.
Of the figure, 83,345 are service companies, making up 73.9 percent while 27,903 others operate in industry and construction, accounting for 24.7 percent.
A total number of 101,115 small-sized enterprises (with a registered capital worth under VND10 billion or US$421 million) were set up, making up 89.6 percent and up 34.9 percent against the same period last year.
The newly-established firms created 758,124 jobs, up 16.8 percent.
During the reviewed period, 50,509 firms resumed operations, up 56.1 percent, raising the number of newly-established and re-operated enterprises to 163,300, up 38 percent.
In the third quarter alone, the new firms doubled the number recorded in the same period last year with 36,558 ones.
Local administrations urged to seek private investors for early construction of airports
Deputy Prime Minister Le Van Thanh urged local authorities to rashly select private investors to early kick start construction of Sa Pa, Quang Tri, Lai Chau and Phan Thiet airports under the public-private partnership (PPP) format by early 2023.
The Deputy Prime Minister made the request at a meeting with local leaders of 15 provinces and cities that have demands for airport upgrading, expansion, and construction.
The Government called for more decentralization on airport development so that local leaders are authorized to seek investment for airport construction under PPP model.
Deputy Minister of Transport Le Anh Tuan was quoted as saying that in the 2021-2030 period, Viet Nam will have 14 international airports and 14 domestic ones. By 2050, the number of domestic airports will increase to 17.
Vietnam’s green growth investment facilitation policies introduced at AsiaBerlin Summit
Vietnam’s policies for facilitating investment in green growth have been presented at the AsiaBerlin Summit 2022 held in the German capital city.
In his speech, Nguyen Manh Hai, Counsellor and head of the investment promotion division at the Vietnamese Embassy in Germany, said political and social stability and the strategic location are among favourable conditions for Vietnam to attract foreign investment. Low labour costs and a large, young, dynamic, skillful and industrious workforce have also added to the country’s attractiveness to investors.
So far, Vietnam has signed 15 free trade agreements (FTAs), including a multilateral one among members of the Association of Southeast Asian Nations (ASEAN), bilateral deals between the bloc and other countries, and Vietnam’s bilateral FTAs with the EU and some countries like Japan, Chile, the Republic of Korea, and the UK. The country has also been assessed as a one with an optimal investment climate and many investment incentives for investors.
The summit drew a large number of startups from across Europe and Asia, aiming to connect the firms to promote entrepreneurship and the realisation of the Sustainable Development Goals in the five topics of people, prosperity, planet, peace, and partnerships.
Trade ministry eyes Vietnam’s exports to end 2022 on a high note
Vietnam stays on track to realize the export growth target of US$368 billion for this year amid severe impacts from the Russia-Ukraine conflict on global supply chains, according to the Ministry of Industry and Trade (MoIT).
The ministry’s data as of September 15 revealed the combined export turnover stood at $265.34 billion, up 17.82% year-on-year, while imports rose by 13.15% to $260.7 billion, resulting in a trade surplus of nearly $4.64 billion.
Deputy Director of the MoIT’s Import-Export Department Tran Thanh Hai noted the Regional Comprehensive Economic Partnership (RCEP) that took effect in early 2022 is vital for Vietnam to diversify export markets.
Hai added the deal with the participation of China would help Vietnam source cheaper input materials, subsequently leading to a more significant advantage in penetrating major markets in Europe and America.
Other next-generation free trade agreements (FTAs) that Vietnam is a part of, including the EVFTA and CPTPP, have gone into the next phase of higher tariff cuts. He said this, along with the subdued Covid-19 situation globally, has continued to boost exports.
A highlight in Vietnam’s trade has been rice exports, with many products having gained branding awareness and penetrated high demands markets such as the US or Europe.
In the latest move, Japan, for the first time, has imported 100 tons of ST25 rice to sell at supermarkets and convenience stores.
New models to be displayed at Vietnam Motor Show 2022
The Vietnam Motor Show 2022 will officially take place in Ho Chi Minh City on October 26 with the participation of 14 auto brands, motorcycle manufacturers and several popular brands from the supporting industry.
This information was unveiled at a press conference held by the Vietnam Automobile Manufacturers Association (VAMA) and Vietnam Genuine Automobile Importers (VIVA).
According to organisers, 14 auto brands have to date confirmed their participation in the event, including Audi, Brabus, Honda, Jeep, Lexus, Mercedes-Benz, Mitsubishi Motors, Morgan, MG, RAM, Subaru, Toyota, Volkswagen, and Volvo.
At the Vietnam Motor Show 2022, each brand is expected to introduce several of their outstanding models featuring cutting-edge technologies, in an attempt to create diverse and attractive experiences for visitors.
Most notably, leading automaker Morgan plans to display two of its newest models - Morgan Plus Four and Morgan Plus Six - for the first time at the event.
Other brands such as MG, Subaru, Toyota, Volkswagen, and Volvo will also introduce their new auto models using environmentally friendly technologies.
Automakers will also exhibit other means of transport such as trucks, large displacement motorcycles, and electric vehicles.
The expo is scheduled to run through until October 30 and is expected to attract more than 180,000 visitors.
Rice businesses seek to penetrate demanding markets
A number of Vietnamese rice businesses are planning to export high-quality products like ST25 to demanding markets such as Japan, Australia, the UK, and the EU.
ST25, which was crossbred by engineer Ho Quang Cua and recognised as the world’s best rice in 2019, is becoming increasingly popular in the global market.
Tan Long group which specialises in animal feed processing and rice exports, recently announced plans to introduce ST25 branded A An into the European market after the Vietnamese rice was positively received in Japan.
In June Tan Long successfully delivered its first shipment of ST25 rice branded A An to Japan after it passed the extremely rigorous testing process of more than 450 indicators. This was the first time that a domestic rice brand had been successfully exported to Japan widely viewed as a highly demanding market.
Most notably, its ST25 rice was part of the menu of dishes made for the Japanese Cabinet Office on September 2.
Meanwhile, Ho Quang Tri, a private business specialising in rice, corn, and other cereal grain processing, and EUTEK group of the UK signed a contract on September 8 to exclusively distribute ST 25 rice branded Mr Cua ST25 Rice in the UK.
Nguyen Hai Nam, business development manager of EUTEK Group, said the successful penetration of Mr Cua’s rice into the UK market clearly demonstrates the rising position and future potential of Vietnamese rice in the global market. He noted that his group is currently focusing on marketing so it can distribute more rice and other specialties from Vietnam to this market.
Moreover, the Ho Quang Tri firm reached a deal with AusViet Food Trading PTY.Ltd. in early August to sell Mr Cua ST25 Rice in Australia.
Early September also saw Loc Troi Group introduce the Vietnamese rice product branded ‘Com Vietnam’ at Carrefour Ormesson and E.Leclerc Viry Chatillon hypermarkets in France. A representative of the group said that roughly 860 tonnes of Jasmin rice will be sold throughout E.Leclers' outlet chains for the medium segment, whilst higher-quality rice will be delivered to the outlet chain during the Vietnamese week slated for this November.
This positive news has motivated local businesses to improve their product quality and develop brands as they seek to make inroads into the demanding markets. According to statistics unveiled by the Ministry of Agriculture and Rural Development, as of August 15, Vietnamese rice exports reached more than US$2.3 billion, up 8.1% in value over the same period from last year.
Long-term bond yields decline in emerging East Asia
Viet Nam’s local currency bond market grew 8.1 per cent from the previous quarter to US$99.5 billion. The faster expansion was driven by both the Government and corporate bond segments. This information was recently released at the Asia Bond Monitor report by the Asian Development Bank (ADB).
According to the report, long-term bond yields in emerging East Asia declined between June 15 and August 24 amid mounting risks and a dimming economic outlook, even as financial conditions eased modestly.
Yields of 10-year local currency Government bonds dropped while yield curves flattened. Both are typically signals that investors expect slower economic growth. Currencies in the region continued to depreciate against the US dollar amid the weaker outlook.
Financial conditions in emerging East Asia eased moderately from mid-July to mid-August, when equity markets rallied, risk premiums narrowed, and portfolio inflows returned amid speculation that the US Federal Reserve would slow the pace of interest rate hikes. However, ongoing and renewed risks have continued to weigh down investor sentiment, including concerns about persistent inflation, faster-than-expected US monetary tightening, lingering impacts of the COVID-19 pandemic, a greater-than-expected slowdown in the Republic of China (PRC), and the protracted fallout from the Russian 'military operation' in Ukraine.
Emerging East Asia comprises the PRC; Hong Kong, China; Indonesia; the Republic of Korea; Malaysia; the Philippines; Singapore; Thailand; and Viet Nam.
The region’s bond market saw record-high issuance in the second quarter of this year, driven mostly by the PRC’s efforts to stimulate the economy. Regional bond stock rose to $22.9 trillion at the end of June. Issuance in economies belonging to the Association of Southeast Asian Nation (ASEAN) rose 10.3 per cent, expanding the bloc’s share of regional bond issuance to 17.5 per cent.
In Viet Nam, the market increased 31.6 per cent from a year earlier. Government bonds increased 7.4 per cent from the previous quarter, driven by growth in central bank bills, to $69.8 billion. Corporate bonds climbed 9.5 per cent from the previous quarter to about $30 billion, driven by hefty issuance.
State capital for waste treatment accounts for 75 percent
Investment in infrastructure for solid waste treatment is mainly taken from the state budget with 75 percent and ODA loans whereas just a few private companies poured money into this field, said the Ministry of Natural Resources and Environment (MONRE).
The Ministry cited a study conducted by the World Bank which shows that 75 percent of waste treatment costs in Vietnam are funded by the government.
According to the General Department of Environment under MONRE, in 2021, households nationwide produced nearly 52,000 tons of domestic solid waste a day. It is estimated that daily-life solid waste will increase by 10 percent-16 percent a year. Currently, about 71 percent of waste is being treated by the landfill method.
According to statistics from the Ministry of Construction, in the 2012-2020 period, there have been 143 investment projects to build solid waste treatment plants with a total investment capital of about VND21,600 billion. However, spending on waste treatment plants is mainly taken from the state budget.
Processing - manufacturing, real estate top FDI attraction in nine months
Processing - manufacturing and real estate are the biggest magnets for foreign direct investment (FDI) in the first nine months of 2022, statistics showed.
As of September 20, registered FDI totalled 18.7 billion USD, down 15.3% year on year, according to the Foreign Investment Agency under the Ministry of Planning and Investment (MPI).
The figure includes 7.12 billion USD poured into 1,355 new projects, respectively falling 43% and rising 11.8%. More than 8.3 billion USD was poured into 769 existing projects, up 29.9% and 13.4%, respectively. Meanwhile, foreign investors spent over 3.28 billion USD on purchasing shares in Vietnamese companies, up 1.9%.
The processing and manufacturing sector continued to take the lead with over 12.1 billion USD in FDI, accounting for 64.6% of total registered capital. It was followed by real estate with over 3.5 billion USD, or nearly 19%.
The MPI said though newly registered investment has yet to fully recover from the COVID-19 pandemic’s impacts and recent global uncertainties, the capital added to existing projects and spent on share purchases have been on the rise.
In the first nine months, Vietnam recorded investment from 97 countries and territories. Singapore was the largest source of FDI during the period with more than 4.75 billion USD (equivalent to 25.3% of the total but still down 24.3% from a year earlier). The Republic of Korea ranked second (3.8 billion USD, equivalent to 20.3%, down 2.38%) and Japan third (1.9 billion USD, equivalent to 10.2%).
Ho Chi Minh City was the biggest FDI destination with over 2.96 billion USD registered, making up 15.8% of the total and rising 26.2%. It was followed by southern Binh Duong province (2.7 billion USD, equivalent to 14.4%, up 58%) and northern Bac Ninh province (1.78 billion USD, equivalent to 9.5%, and increasing 2.1-fold).
As of September 20, Vietnam was home to 35,725 valid FDI projects worth more than 431.5 billion USD.
PVFI fined VND420 million for securities violations
The State Securities Commission has fined PetroVietnam Insurance Financial Investment JSC (PVFI) a total of VND420 million for breaching securities market regulations.
A fine of VND350 million was imposed on PVFI for failure to register securities trading and listing, and another totaling VND70 million for failure to disclose information.
The company did not adhere to financial reporting obligations for the fourth quarter of 2014, all quarters of 2015, the first quarter of 2016, and annual audited reports for 2014, 2015 and 2021, among others.
Additionally, PVFI failed to update financial statements for several years on the State Securities Commission’s information system.
The firm registered as a public company prior to January 1, 2016. However, it has not applied for listing as required.
PVFI must submit an application for the registration of securities trading and listing to the Vietnam Stock Exchange and its subsidiaries within 60 days, according to the commission.
PVFI, a subsidiary of the Vietnam Oil and Gas Group (PetroVietnam), began operations on June 1, 2007.
The company’s recent loss-making operations have led to a VND173 billion negative equity. Its financial revenue fell substantially in 2021, dropping by 39% to under VND2 billion.
In September, several companies, including KB Securities Vietnam, Tien Phong Securities, VPS Securities, Everest Securities and An Binh Securities, were fined more than VND1.3 billion for violations in securities activities.