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Vietnamese fleet to handle a fifth of exports by 2030: transport ministry

VN has set an objective to build up its merchant fleet to handle as much as 20 per cent of the country's exports by the year 2030, according to deputy minister of transport Nguyễn Xuân Sang. 

He said the main goals included the development of a modern fleet, improvement of efficiency and quality and greater integration into the international market. 

The short-term focus was to build up a fleet of container ships for the Asia-Pacific region, with an objective to gain operational experience and set the foundation for long-distance routes in the future. 

In addition, the Vietnamese maritime authorities could use the experience to improve their management capacity, legal framework, implementation of science and technology and administrative procedures to better support economic enterprises. 

He said Việt Nam was to increase collaboration with countries around the world and enter into international maritime treaties, especially a speedy conclusion to maritime transport agreements with neighbouring partners including China, Cambodia and Thailand. 

Earlier, the ministry mentioned several tax cuts for container ships with a capacity of 1,500 TEU or greater, ships fuelled by green energy and ships specialised in the transport of LNG. Crew members who operate on domestic routes may also be eligible for income tax exemptions. 

Sang said the country had been and would stay committed to the development of Vietnamese shipping companies. He urged Vietnamese companies to form alliances, pool resources and build up their expertise to reach farther destinations such as Europe and America. 

In addition, Việt Nam would stay on course with its transition to green energy in maritime transport in accordance with a roadmap set out and agreed upon during the 2021 United Nations Climate Change Conference (COP26). 

Vietnam - Australia trade goes up 37% in eight months

Trade revenue between Vietnam and Australia approximated 11 billion USD in the first eight months of 2022, up 37.44% from a year earlier, statistics show.

Notably, Vietnam’s exports to Australia surged 42% to 4.9 billion USD, according to Vietnam’s trade office in the country.

Among the main exports to Australia, fishery products brought home 247.6 million USD (up 49%), timber and wood products 135.4 million USD (up 23.99%), confectionery over 50 million USD (up 50%), and steel 142 million USD (up 232.92%).

Meanwhile, imports also rose 34.75%, with input materials for production such as coal, iron ore, metal, and wheat being the main commodities purchased from Australia.

Sustainability key to cotton production growth: Experts

At Cotton Day Vietnam 2022 held in Ho Chi Minh City on October 4, experts held that among the new trends of the garment and textile sector, verified data and supply chain transparency are the top factors that enhance the competitiveness of products.

President of Cotton USA (CCI) Carlos Garcia said that Vietnam is the second largest cotton importer of the US and also an important source of supply of the material.

President of the Vietnam Textile and Apparel Association (VITAS) Vu Duc Giang said that this year, Vietnam aims for 42-43 billion USD in garment and textile exports. To this end, the sector has paid great attention to material supply sources and regulations on origin in import markets, he said.

Giang underlined that Vietnamese enterprises are in need of information on the cotton material sources as well as market forecast report for the 2023-2024 period.

A CCI representative said in the coming time, more and more global brands and retailers will require cotton products imported to the US and EU to be sustainable and in a transparent supply chain that is verified to be free of forced labour.

At the event, US experts, suppliers and producers also shared information and market trends and ideas to optimise cooperation opportunities between Vietnam’s garment and textile sector and the US cotton industry.

Benjamin Petlock, Senior Agricultural Attaché at the US Consulate General in Ho Chi Minh City, said that the breakthrough growth in Vietnam's garment and textile exports has made the country a promising market for multinational material suppliers. Meanwhile, changes seen in the sector recently has proved the timely adaptation and flexibility of the industry, he added.

Government to stay consistent with macro-economic stability goals

Amid fluctuations in the world situation, especially the increase in interest rate, soaring inflation and tightened monetary policies, the Government will stay consistent with the targets of maintaining macro-economic stability, reining in inflation, promoting growth and ensuring major economic balances in the rest of the year.

Towards those goals, in its Resolution No. 126/NQ-CP, the Government asked the State Bank of Vietnam to coordinate with ministries, sectors and localities to implement a cautious and steady but flexible monetary policy in combination with other fiscal policies to control inflation and keep macro-economy stable.

The bank was requested to combine tools and solutions regarding exchange rate, interest rate, growth credit, and speed up the implementation of the policy of 2% interest rate support, while strengthening communications to create social consensus and improve the efficiency of the policy implementation.

In the decision, the Government also assigned specific tasks to the Ministry of Finance, Ministry of Planning and Investment, Ministry of Industry and Trade, Ministry of Agriculture and Rural Development, Ministry of Labour, Invalids and Social Affairs, and Ministry of Construction.

Hanoi wakens agritourism potential

With high potential in agricultural tourism in 18 outlying districts, Hanoi has focused on bringing agritourism products closer to tourists, attracting more visitors to rural areas, and contributing to the building of new-style rural areas and boosting local socio-economic development.

Thanks to ancient agricultural villages and a diversity of local specialties, outskirt districts such as Thuong Tin, Ung Hoa, Dong Anh, Soc Son, Thach That and Ba Vi have attracted a large number of visitors.

The number of educational farms and agricultural eco-tourism areas have been developed, meeting the demand to explore and experience agricultural activities of visitors. They have been connected with craft villages and ancient villages to form attractive tours in the city outskirts.

However, there are still a number of shortcomings in the city's agricultural tourism development, including the small scale of tourism farms and poor connections with the new-style rural area building programme.

To deal with the problem, recently, the People’s Committee of Hanoi has issued a plan to boost the development of agritourism in line with the building of new-style rural areas in the 2022-2025 period.

Meanwhile, the city tourism sector has implemented plans to develop relevant tourism products and encourage traveling activities, while focusing on training human resources and building tourism criteria for model new-style rural areas to support businesses and individuals to develop agritourism in the city.

Director of the Hanoi Department of Tourism Dang Huong Giang said that in order to create typical agritourism products, Hanoi will optimise its advantages wet rice cultivation and culture of the northern delta region, and foster the combination of agritourism and cultural heritage and craft village. Rural farms have been developed serving school tourism activities and weekend vacations in outskirt areas and vicinity.

The department has worked with six districts of Thach That, Thuong Tin, Son Tay, My Duc, Dan Phuong and Thanh Tri to evaluate their infrastructure for agritourism activities and explore issues needing improving in the localities, Giang said.

Imports, exports via Lao Cai border down 39.4% in value

The import and export value of goods and services transferred via Lao Cai province’s international border gates neared 1.7 billion USD in the first nine months, down 39.4% year-on-year.

According to reports from the People’s Committee of the northwestern province, nine-month exports reeled in 708 million USD, a year-on-year drop of 31.28%. Key export products included peeled wood, dried cassava and fruit.

Meanwhile, the import value was down 18.58% to 460.05 million USD in the reviewed period. Key imports were mostly coke, fertiliser, chemicals and consumer goods.  

Due to COVID-19, fruit exports to China via the Kim Thanh II international border gate fell by more than 90%.

Hoang Chi Hien, director of the provincial Department of Industry and Trade, said the volume of customs clearance activities remains limited at local sub-border gates. Trade at the international railway border gate is continuing as normal, he added.

Mining, construction expo attracts over 100 firms

More than 100 domestic and foreign enterprises are participating in the Vietnam International Mining, Minerals Recovery and Construction Exhibition, which opened in Hanoi on October 4.

The businesses came from 18 nations and territories, including the Czech Republic, China, and Poland. 

Lasting until October 6, the expo is taking place at the International Centre for Exhibition (ICE) at 91 Tran Hung Dao, Hoan Kiem district.

The organiser said it offered an ideal networking venue for the participating businesses operating in the mining, mineral, and construction industries.

Customs sector’s budget revenue surges 14.7% in nine months

The General Department of Vietnam Customs announced on October 4 that its state budget revenue surpassed 328.83 trillion VND (13.77 billion USD) in the first nine months of 2022, up 14.7% year-on-year.

This year, the sector was assigned to collect 352 trillion VND for the State budget.

In the remaining months, the general department will maintain concerted and drastic measures to facilitate trade, improve the efficiency of state management, and prevent losses in budget collection.

Over the past months, it has paid special attention to fighting cross-border smuggling and commercial frauds.

As of September 15, the sector had detected over 12,200 violation cases with seized commodities worth 4.43 trillion VND, and 253.9 billion VND collected to the State budget.

Agro, forestry, aquatic trade surplus doubles in nine months

Vietnam’s foreign trade of agro, forestry and aquatic products hit some 74.7 billion USD in the first nine months of 2022, a year-on-year rise of 10.7%, according to latest data released by the Ministry of Agriculture and Rural Development (MARD).

Exports reached about 40.8 billion USD while imports totalled 33.9 billion USD, up 15.2% and 5.7%, respectively, year-on-year, and this means the trade surplus of the sector mounted to 6.9 billion USD, doubling the same period last year.

In September alone, exports spurred 28.7% compared to the same month last year to over 4.2 billion USD. However, the figure was 8.8% lower than the previous month’s.

During the nine-month period, Vietnam exported more than 16.8 billion USD worth of key agro products, a year-on-year increase of 7.5%. Shipments of major forestry products valued around 13.3 billion USD and seafood, 8.5 billion USD, up 10.8% and 38%, respectively.

Seven products with export revenue surpassing 2 billion USD each include coffee, rubber, rice, vegetables and fruits, shrimp, and wood.

High upturn was seen in the export of coffee (37.6%), cassava (21%), tra fish (83.3%), and shrimp (24.8%).

A downturn, meanwhile, was recorded in some others, including vegetables and fruits (11.1%), cashew nuts (14%), and livestock products (18.4%).

The US remained Vietnam’s largest buyer, spending over 10.5 billion USD which accounts for 25.8% of the total. It was, again, followed by China (7.4 billion USD) and Japan (3.1 billion USD).

Seafood exports on course to beat US$10 billion target this year

Vietnam has earned US$8.5 billion from seafood exports during the past three quarters, up 38% year on year, and the seafood export value is likely to hit US$10 billion by the end of November, according to the Vietnam Association of Seafood Exporters and Producers (VASEP).

In September alone, seafood exports brought in more than US$850 million, a year-on-year rise of 36%. But this was the first time after seven months, monthly seafood exports fell to below US$900 million.

Seafood exports slowed down in September compared to the previous months due to mounting inflationary pressure in major markets that affected their import demand, said Le Hang, deputy director of VASEP.PRO Center under VASEP.

China topped the list of Vietnamese seafood consumers in September, spending US$153 million on imports, up 97% compared to the same period in 2021.

Seafood exports to the US decreased 11% in value (to US$140 million), while those to the EU and the Republic of Korea rose 31% and 19% respectively.

Among aquatic products, pangasius raked in US$161 million from export in September, up 97%. Despite falling import demand due to high inflation, Vietnamese pangasius fillets are affordable for ordinary consumers.

Overall in nine months, seafood exports to the EU exceeded US$1 billion, up 41% over the same period last year. But the US took the lead, importing nearly US$1.8 billion worth of seafood from Vietnam, up 22%.

Rubber exports gross US$2.32 billion over nine months

Vietnam exported approximately 1.41 million tonnes of rubber worth US$2.32 billion during the past nine months of the year, representing a rise of 9.7% in volume and 7.8% in value compared the same period from last year.

According to figures released by the General Department of Vietnam Customs, September alone saw the country ship some 210,000 tonnes of rubber worth US$305 million abroad, representing an annual rise of 16% in volume and 2% in value.

The average export price in September reached US$1,455 per tonne, marking a drop of 4% from the previous month and 12.1% lower than September last year.

In the initial eight months of the year, major Vietnamese rubber exports mainly consist of a mixture of natural rubber and synthetic rubber, Latex, SVR 3L, SVR 10, RSS3, and SVR CV60.

Of these, the mixture of natural rubber and synthetic rubber is the most exported item, accounting for 56.4% of the nation’s total export volume of rubber with turnover hitting US$14 billion, representing a decline of 1.3% in volume, but up 1.1% in value against last year’s corresponding period.

Most notably, rubber exports to the Chinese market made up 99.7% of the country's total export of natural and synthetic rubber, with turnover reaching US$1.13 billion, a drop of 1.1% in volume, but up 1.3% in value on-year.

Firms change capital-raising plans amid bearish sentiment

Many firms have begun to change their capital-raising plans amid the recent decline in the stock market, according to experts.

Sao Mai Group Corporation (HOSE: ASM) initially planned to issue roughly 168 million shares to raise over VNĐ2 trillion.

About VNĐ1.6 trillion of the proceeds would be used to add to its operating capital, VNĐ253 billion to invest in An Giang Tourism Development JSC, and VNĐ69 billion to invest in Dong Thap Tourist JSC.

However, the firm later announced the cancellation of the plan on grounds of global uncertainties and unfavourable market conditions.

Louis Capital JSC (HOSE: TGG) followed suit by shelving its plan to issue 54.6 million shares, of which one half was offered to existing shareholders and the other to investors via private placement.

Kien Giang Construction Investment Consultancy Group (HOSE: CKG) did likewise by suspending its registration for the private placement of 13.4 million shares.

Approved in August, CKG's plan aimed to offer the shares, VNĐ15,000 apiece, to professional investors to raise VNĐ201 billion, which would be used for debt settlement and wage payments.

Experts attributed the cancellation of the capital-raising plans to a bearish market, which saw many stocks fall off peaks by between 50 and 70 per cent in prices.

Price drops make the share offerings less attractive to investors, leaving many issuers with no choice but to cancel their plans to avert unsuccessful issuances.

However, some issuers stayed the course by lowering their offering prices amid bearish sentiment.

Development Investment Construction JSC (HOSE: DIG) drew up a new plan to offer 100 million shares at most to its existing shareholders to mobilise VNĐ1.5 trillion for the Long Tân Tourism Urban Project.

Under the plan, DIG new offering price (VNĐ15,000 per share) was set at half the offering price set in late May (VNĐ30,000 per share).

Thu Duc Housing Development Corporation (HOSE: TDH) initially approved the plan to offer 120 million privately-placed shares at a price of VNĐ12,000 apiece in its general meeting early in the year.

However, the firm later adjusted the plan by cutting the offering volume to 58 million shares and the offering price to VNĐ10,000 apiece, down 20 per cent.

The purpose of issuance was changed as well, from financing Đông Trung Residential Project in Bình Dương Province to financing Nhã Đạt Residential Project in Long An Province.

Although share offerings were not so successful for some firms, total capital raised by the channel in the first nine months of 2022 stood at tens of trillions of đồng.

Securities firms and banks took the lead in terms of volume and success rates. Remarkably, NamA Bank, SEABank, VNDirect and SSI managed to raise trillions of đồng through share offerings to existing shareholders.

BIDV Securities JSC (BSC) successfully raised nearly VNĐ2.7 trillion from offering privately-placed shares to its Korean shareholder Hana Securities with a price of VNĐ41,000 apiece, about 37 per cent higher than their market price.

Vietnam Container Shipping JSC said it took them up to 11 months to raise capital via public offerings. In the capital-raising plan in mid-September, it switched to private placement to not "pass up the opportunity to competitors".

Public offerings allow issuers to distribute shares to more than 100 investors. However, this means of issuance sets the bar high on issuers' financial health and incurs a lengthy procedural process.

FDI into industrial property doubles in the first nine months
Foreign direct investment (FDI) continued to flow into Viet Nam's industrial property market, accounting for 19 per cent of total FDI or US$3.5 billion during the first nine months of the year, doubling the figure recorded during the same period last year.

Industrial properties will likely see the most growth, according to Savills Viet Nam. Strong economic indicators in recent years have sent foreign investment soaring, especially in the northern and southern economic hubs.

In a report released by the agency in September, industrial property supply remained stable with demand soaring, especially in Ha Noi and HCM City. Improved infrastructure and enlarged land allocation have resulted in increased ability to compete but not without a surge in prices.

On average, rental for industrial property in Ha Noi has reached $140 per square metre (sqm), HCM City $200 per sqm. Prices tend to be slightly lower in the two industrial hubs' neighbouring provinces and could be strong alternatives as provincial authorities have distributed more land to industrial projects.

Strong contenders for FDI included Bac Ninh, Hai Phong, Hung Yen and Hai Duong in the north, Binh Duong, Ba Ria-Vung Tau and Long An in the south.

During the second quarter of 2022, nine industrial projects worth a total of VND29.4 trillion ($1.23 billion) with a land area of 2,472 hectares have been given the green light, which have been projected to go into operation during 2023-25.

PM asks for solutions on import and export activities
The Prime Minister has called for import and export activities at border gates to be rectified to prevent congestion while any violations must be strictly handled.

This request was raised as there appeared brokers are carrying out administrative procedures for faster customs clearance at border gates.

Due to new COVID-19 pandemic development in the region, vehicles transporting goods must queue for customs clearance, especially at Tan Thanh Border Gate, Lang Son Province and a number of other land border gates in the northern provinces, which caused congestion, disorder and seriously affected economic and social activities as well as production of enterprises.

Taking advantage of this difficulty, many people colluded to provide services for administrative procedures in customs clearance.

The Prime Minister asked heads of relevant ministries and agencies, including the ministries of public security, national defence, finance, industry and trade, foreign affairs, transport, agriculture and rural development and provincial/municipal people’s committees to keep a close watch on the import and export activities to raise measures to prevent congestion and other problems.

Violations must be handled strictly, the Prime Minister said.

The customs departments must review procedures for customs clearance at land border gates for adjustments and strengthen digital transformation to speed up the clearance process. In addition, customs departments must work with China customs to raise solutions to enhance clearance capacity, especially for some seasonal agricultural products.

The relevant ministries must coordinate to ensure the circulation of goods is appropriate with the clearance capacity of border gates. Inspections would also be enhanced to prevent smuggling and trade fraud. 

Higher funding costs to have limited impact on Vietnamese banks
The Vietnamese central bank’s move to lift short-term deposit rate caps is likely to raise the average cost of funds – both deposit and interbank rates – for Vietnamese commercial banks.

However, the banks should be able to pass some of the additional cost on to borrowers, limiting the impact on net interest margins (NIM), according to Fitch Ratings.

In a recent report, the rating agency said the State Bank of Vietnam’s (SBV) decision to raise key policy rates by 100 basis points on September 22 exceeded its expectation that these rates would rise by only 50 basis points by end-2022.

It follows a sharp rise in US interest rates and weakening global demand prospects, which have increased the risk of capital outflows and contributed to downward pressure on the Vietnamese dong, although the currency has weakened by less against the US dollar than many other APAC currencies this year.

According to Fitch, the policy rate adjustments will have little impact on Vietnamese banks, as they apply to central bank facilities that do not constitute an important source of funding for most major banks. The increase in deposit rate caps, which took those for one-six month dong deposits to 5 per cent, will have more impact as the caps have constrained deposit rates at a number of banks in recent months.

Fitch believes demand for credit is likely to outstrip the quota-constrained supply in the remainder of the year and credit conditions are unlikely to ease much, as persistent inflationary pressures amid robust domestic growth and further dong depreciation will leave the SBV wary of faster credit expansion.

According to Fitch, Vietnamese banks could nonetheless be vulnerable if interest rates rise sharply beyond Fitch’s base case. Corporate leverage is high and interest-rate hedging rare, so a spike in lending rates would weigh on asset quality. Banks’ capital buffers are generally thin, especially at State-owned banks, reflecting persistently rapid loan growth. This reduces their ability to absorb any unexpected spike in credit costs. 

Agricultural sector urged to scale up by-product use

Vietnam’s biomass potential from by-products has been assessed to surpass 160 million tonnes annually and is valued at around $46.5 billion. However, only a minor part of this potential is being tapped, experts have said.

Nguyen Huu Ninh, deputy director of the Department of Science, Technology and Environment under the Ministry of Agriculture and Rural Development (MARD), believes that by-products in the agri-forestry and fisheries sectors should be deemed renewable resources to bolster agriculture’s value chain and minimise waste.

Ninh made the remarks at the international workshop “Agricultural by-products – Renewable resources” hosted by the MARD in Ho Chi Minh City on September 30.

According to the MARD, the volume of by-products in the agricultural sector currently approximates 160 million tonnes, of which about 90 million tonnes stem from crop harvesting and agricultural processing, accounting for 56 per cent of the total; 62 million tonnes are generated in livestock breeding, equal to 38.7 per cent; six million tonnes is from the forestry sector, making up 3.7 per cent; and nearly one million tonnes, 0.6 per cent, is from the fisheries sector.

Annually, these by-products can supply about 43 million tonnes of organic fertiliser; 1.8 million tonnes of urea fertiliser; 1.6 million tonnes of superphosphate fertiliser; and 2.2 million tonnes of potassium sulfate fertiliser.

In animal husbandry, with about 84.5 million tonnes of waste discharged into the environment each year, only about 20 per cent is reused effectively (biogas production, composting, fishmeal among others), while the remainder is mostly unused.

In farming, about 10 per cent of farming by-products are used as on-site fuel, 5 per cent as industrial fuel, 3 per cent as animal feed, while over 80 per cent is either discharged into the environment or burned, causing pollution.

Meanwhile, in the fisheries sector, by-product processing generates about $275 million currently, whereas given nearly 1 million tonnes of by-products in the sector, the amount of proceeds is expected to touch $4-5 billion through efficient technology use.

According to Nguyen Hong Long, director of the Centre for Creativity and Sustainability Study and Consultancy, the biomass potential of Vietnam’s by-products surpasses 160 million tonnes per year, generating $46.5 billion in value, generating jobs for 180,000 labourers, and bringing benefits to 13 million households and 900,000 food and drink trading units.

With just a marginal part of these by-products being tapped, there is a vast amount of waste.

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



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