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VIETNAM BUSINESS NEWS SEPTEMBER 25

Action plan to promote green growth in agriculture
Action plan to promote green growth in agriculture hinh anh 1

The Ministry of Agriculture and Rural Development (MARD) has approved an action plan to implement the National Strategy on Green Growth from 2021-2030.

The plan aims to specify goals, tasks and solutions to realise the strategy and the national action plan for green growth.

Under the plan, the ministry will work to develop the agricultural sector in an ecological, organic, circular and low-carbon direction to improve growth quality, added value, competitiveness and sustainable development, while reducing pollution in agricultural production and rural areas, and promoting energy efficiency towards carbon neutralisation by 2050.

Specifically, the sector aims for 2.5-3% in annual growth, and 42% in forest coverage. 

It will strive to increase the use of organic fertilisers to 30% of all those consumed, along with 30% of pesticides and at least 30% of farm areas using water-saving systems.

The sector will switch 300,000 hectares of rice to other crops with higher economic and environmental efficiency, while aiming for over 2% of organic farms out of the total farming area.

It will also upgrade small-scale breeding farms to larger scale ones, while applying solutions to protect fishery resources sustainably, developing concentrated material forest areas, recovering natural forests, and dealing with pollution caused by agro-forestry-fishery processing activities.

Vietnam eager to boost fertiliser supply

Aware of the key role of fertilisers in the economy, Prime Minister Pham Minh Chinh in early September said that boosting domestic production would create stable supply for agricultural production, decrease imports, and contribute to building an independent and self-governing economy.

The PM asked ministries and sectors to solve difficulties at the Ha Bac fertiliser plant and Ninh Binh Nitrogenous Fertiliser Co. Ltd., both units of state-run chemical group Vinachem.

On a business trip to these plants in mid-August, he said that the two plants had many similarities, such as cumulative losses, initial low capital, engineering, procurement, and construction (EPC) contract agreement, and poor performance.

To stabilise the price in the domestic market, in late August, the Ministry of Finance again asked the government to apply an export tax rate of 5 per cent. The first proposal was submitted in April.

PM Chinh asked ministries and local authorities to cooperate with the companies to resolve the EPC contract agreement, minimise losses, increase productivity, solve credit contracts, and reduce prices.

The Ha Bac fertiliser plant opened seven years ago, but environmental and financial issues have arisen since. After being upgraded and expanded, the plant is expected to eventually raise its annual capacity to 500,000 tonnes from 180,000 tonnes.

Ninh Binh Nitrogenous Fertiliser was established in 2011 with total charter capital of VND2.5 trillion ($108.7 million). Since it began operations, the company has reported losses for consecutive years.

In the last two years, business results have been more positive. In 2021, they earned over $174 million in revenue, increasing 229 per cent from 2020. In the first half of 2022, it acquired over $109 million in revenue and made a profit of nearly $30.4 million. Its total current assets now reach $382 million.

However, the company still suffers big losses. In 2021, it had debts of $521.7 million. It has made plans to build a debt restructuring strategy to submit to the government.

Concentrating on these two fertiliser plants has been the government's priority because they were two of 12 loss-making projects managed by the Ministry of Industry and Trade.

The mission has become more urgent as the price of imported fertilisers and materials for production is volatile due to political instability elsewhere.

To stabilise the selling price in the domestic market, in late August, the Ministry of Finance (MoF) again asked the government to apply an export tax rate of 5 per cent. The first proposal was submitted in April.

According to the MoF, the proposal will help retain fertilisers for domestic consumption amid the price surge. In addition, applying the same tax rate for all fertilisers will reduce administrative pressure on enterprises and customs agencies as they will no longer have to determine the precise proportion of natural resources and minerals in their products.

Investors wait for wind power administration system

Offshore wind offers a route to diversify the energy system in a cost-effective way, given the technology’s unmatched track record in driving down costs in the context of the major energy crisis facing the world today.

As part of the meeting between Prime Minister Pham Minh Chinh and foreign-invested enterprises and business associations on September 17, Sebastian Hald Buhl, country manager for Ørsted in Vietnam, mentioned the importance of developing offshore wind power.

According to Orsted, offshore wind power is an untapped natural resource, which like oil and gas, can deliver significant economic benefits and provide reliable and domestic power in quantities needed to fuel the country's booming economy.

To ensure a successful launch of Vietnam's offshore wind industry, it is necessary to issue site survey permits urgently so major project development can start. These should be granted exclusively using pre-qualification criteria to ensure efficient use of Vietnam's seabed.

An improved PPA will also mobilise financing and lower the cost of offshore wind. In fact, a few key improvements, such as curtailment protection, would deliver significantly cheaper offshore wind for energy users in Vietnam.

In Vietnam's north, there are now 22 registered projects with a total capacity of 51.6GW. Meanwhile, in the centre and south, there are 74 offshore wind power projects registered with a total installed capacity of 104.6GW.

The total installed capacity of offshore wind power registered in the Power Development Plan VIII is more than 156GW, many times higher than the target of 7GW by 2030.

My Thuan-Can Tho expy might be opened to traffic next April

The Ministry of Transport has told the My Thuan Project Management Board to speed up work on the My Thuan-Can Tho expressway project so that the road can be put into operation before the end of April next year.

The ministry asked the board to urge contractors and workers to complete all bridge projects on the expressway this month, the local media reported.

As for the surface of the road, the soft ground must be handled by late 2022, while work on the macadam foundation and asphalt concrete surface must be completed before April 30 next year, according to the ministry.

The three installation and construction packages of the project are only 48.5% complete and slightly behind schedule. The ministry blamed the contractors for the delay due to their illogical construction operations.

As the project is facing obstacles over site clearance, the ministry asked the management board to work with the local authorities and relevant units to hand over the cleared site this month.

The 23-kilometer-long My Thuan-Can Tho expressway project, which got off the ground in early 2021, will run through the two Mekong Delta provinces of Dong Thap and Vinh Long.

The expressway requires an investment of over VND4.8 trillion and will have six lanes and allow a maximum speed of 100 kilometers per hour.

Once in place, the expressway will help shorten the distance between HCMC and Can Tho City, ease the traffic load on National Highway 1A and boost the socio-economic growth of the Mekong Delta region.

Danang welcomes first international MICE tours

The Tourism Promotion Center under the Danang Tourism Department welcomed 138 guests of a Malaysian company for a MICE tour on September 19.

Danang earlier received a MICE tour of 558 guests of PT. Gajah Tunggal Tbk from Indonesia, organized by the Dong Travel agent from August 29 to October 16, 2022.

According to the Danang Tourism Department, these two international MICE tours are subject to incentives under the support program for MICE tours, such as airport welcoming, communications support, tour consultancy support and art performances.

For MICE tours of over 200 guests, the city will offer free tours in Danang to a maximum of five persons in charge of the event organization survey in three days, accommodation support and site recommendation for event organization.

According to Nguyen Xuan Binh, deputy director of the Danang Tourism Department, Danang has been running the support program for MICE tours on a trial basis since 2020, considered a stimulus for domestic tourism once Covid-19 is brought under control.

Following the support program for MICE tours from February 21 to August 1, 2022, Danang welcomed 31 domestic MICE tours with merely 15,600 visitors, of which seven tours had over 700 guests, nine tours had 300-700 guests and 15 tours had over 100 guests.

Work on Cat Bi Airport’s Terminal T2 to start in mid-2023

Construction of Terminal T2 at the Cat Bi International Airport in Haiphong City is expected to begin in the middle of next year, according to the Airports Corporation of Vietnam (ACV).

Deputy general director of ACV Tran Anh Vu has written to the Ministry of Transport that Terminal T2 at the Cat Bi Airport will be constructed between May 2022 and November 2024 after the completion of site clearance.

The total cost of the project is over VND2.4 trillion.

The corporation has been assigned to complete the pre-feasibility study before September 30 and to seek approval for the environmental impact assessment from the Ministry of Natural Resources and Environment from October to November this year.

The Passenger Terminal T2 project at the Cat Bi International Airport was approved by the Government in July this year.

Upon completion, the terminal will be able to handle five million passengers per year, according to the ACV.

Terminal T2 will be in charge of domestic services, while the existing T1 will become the main international terminal of the airport.

With a total area of 15,630 square meters, Terminal T1 of Cat Bi has been put into service since May 2016, serving around two million passengers each year.

ETC systems need urgent improvements for more effective operation

After nearly 2 months launching the non-stop electronic toll collection system (ETC) nationwide, traffic congestion around toll plazas has seen a reduction, with the time passing a toll booth decreasing by 6-7 times. However, in order for these systems to demonstrate their full potential, service providers need to improve the technical aspect while the State should introduce strict sanctions for violations.

General Director Vu Thi Nguyet of Vietnam Electronic Toll Collection Co. Ltd (VETC) shared that it took Vietnam 5 years just to install ETC booths at toll plazas all over the nation. This is necessary to both address problems in policies, to raise the awareness of the public, and to handle technical inadequacies of ETC systems.

To fully tackle the third issue, Cao Dinh Ngan from Vietnam Digital Transport JSC. (VDTC) stated that it is critical to complete the connection between VETC and VDTC, the two ETC service providers. This can be done through a set of uniformly applicable criteria on system operation between these companies and BOT investors, along with a frequent evaluation of service quality just as telecoms and IT networks have.

He also stressed on too light sanctions and loose policies at present as to ETC, resulting in service providers having to assign more staff to toll booths, which is a dear operation cost. Therefore, he suggested that the Transport Ministry, the Directorate for Roads of Vietnam introduce specific sanctions to handle cases of drivers using fake vehicle license plates. Also, it is advisable to use post-paid methods to tackle mistakes in checking the balance of traffic accounts. This means a traffic account is consider an e-wallet for customers to easily use and manage.

VDTC has already sent its operation, performance evaluation, service contract signing processes, as well as its recommended standards, to the Directorate for Roads of Vietnam as a reference for the introduction of a common procedure for all service providers to work more smoothly.

By now, VDTC has installed its ePass on 1.6 million vehicles, while this figure of VETC is 2.3 million. nevertheless, many people commented that it is unwise to permit only two service providers. There should be more for the public to choose, along with close technological connections among them.

In addition, the way tolls are calculated now is not at all fair since some drivers have to pay for a full route even though they travel only a short distance.

In response to this matter, Deputy Minister of Transport Le Dinh Tho informed that Circular No.45/2021/BGTVT stipulates two toll collection methods. The closed one is used on expressways, where drivers have to pay one fixed toll according to vehicle types regardless of the distance they travel. The open one, in contrast, is used on highways, where the toll is calculated depending on the travelling distance. It is applied on highways because most investment projects under a BOT contract are merely improvements for existing roads, which have a lot of same-level intersections to enter or exit these highways, making it impossible for the closed toll collection method.

Vietnam to have 31 airports by 2050

Vietnam will have 28 airports by 2030 and 31 by 2050, comprising 14 international and 17 domestic ones, according to the Transport Ministry’s airport development plan.

In the 2021-2030 period, the ministry will focus investment on major airports such as Noi Bai in Hanoi and Tan Son Nhat in HCMC, upgrade the current airports and build six more, Long Thanh, Na San, Lai Chau, Sapa, Quang Tri and Phan Thiet.

Sapa, Quang Tri, Lai Chau and Phan Thiet airport projects will get off the ground in late 2022 and early 2023 as they have already been approved for investment and construction.

After the period, three domestic airports, Cao Bang, Cat Bi and the second airport in Hanoi, will be developed, taking the total number of domestic airports to 17 and that of all airports to 31 by 2050.

Work on Con Dao airport upgrade to start next year

The expansion of the airport on Con Dao Island off Ba Ria-Vung Tau Province is slated to begin in 2023 for completion in 2024, according to the Ministry of Transport.

The ministry has assigned the Civil Aviation Authority of Vietnam (CAAV) and the relevant agencies to complete a pre-feasibility study for upgrading the runways, the terminal and aprons at the Con Dao airport.

The plan is expected to be approved in next month.

The Vietnam Air Traffic Management Corporation has begun the planning stage for building an air traffic control tower and an automatic weather observation system at the airport. The construction will be completed in the first quarter of 2024.

As planned, the airport will be expanded to handle two million people annually, five times the current capacity. Its enlarged runway, which will be 15 meters longer and five meters wider, can serve the A320/321 aircraft and alike.

Signal lights and technical facilities will be installed so the airport can operate at night.

CAAV said in August that the Con Dao airport would be closed from April to December next year for a nine-month runway upgrade.

The project costs around VND1,590 billion, funded by the central budget and CAAV.

Central Retail eyes shopping mall project in Dong Thap

Thailand’s retail giant Central Retail plans to develop a shopping mall and Mini Go! project in the Mekong Delta province of Dong Thap, it was announced at a working session between representatives of Central Retail Vietnam and the provincial government on September 19.

According to Central Retail, Mini Go! is an integrated small-scale shopping destination targeting customers in middle-small cities and towns in Vietnam. It provides a shopping mall experience and services such as a supermarket, a playground and F&B services.

Olivier Langlet, general director of Central Retail Vietnam, spoke highly of the potential and advantages of Dong Thap in developing an ecosystem of tourism, services and commerce. Central Retail Vietnam expects the local government to create optimal conditions for the project’s development.

He added that the project, once put into service, would connect manufacturers and suppliers in the area to bring local products onto the shelves at Central Retail stores.

In response, a representative of Cao Lanh City of Dong Thap suggested some locations suitable for the project for Central Retail Vietnam to consider.

Pham Thien Nghia, chairman of the Dong Thap government, affirmed that the province would create optimal conditions for the investor.

Nghia said that aside from its advantages in agro and fishery products, Dong Thap is among the top localities by the number of One Commune One Product (OCOP) items.

Fuel retailers cry for help

Petrol retail enterprises said they would have to cease business in the next few months if relevant policies are not revised.

The volatile fuel market has pushed retailers into difficulties this year and the situation has only worsened in the past two months. 

Petrol agents can hardly maintain their business operations under the current circumstances, business executives said at a conference on September 21. 

Speaking at the conference, the board chairman of Son Hai Petroleum Joint Stock Company, Nguyen Duc Hanh, said the commission offered by major fuel trading enterprises has dropped since July, ranging from VND50 to VND100 per liter or even no commission at some points.

Petrol retailers have tried to maintain their operations despite losses, he added. Their business licenses will be indefinitely revoked if they shut down.

Vietnam has some 17,000 fuel retailers, 75% of which are small and medium, said a representative of My Bao Company.

“The current mechanism would kill private-owned, small- and medium-sized retail enterprises, thereby posing a challenge to the Government’s target of having 1.5 million enterprises by 2025,” My Bao Company’s representative said.

Le Thi Nha, a representative of Van Phuc Petroleum Company Limited, proposed abolishing the regulation that gas stations can buy fuels from just one distributor, saying that this regulation discourages competition and make life difficult for retailers.

Ngo Trung Son, a representative of Trung Son Petroleum Company, proposed shortening the time limit of the price regulation to three days, including weekends and public holidays.

Hoang Anh Tuan, deputy head of the Ministry of Industry and Trade’s domestic market department, said he would report the opinions of fuel retailers to the competent authorities.

Quang Ninh’s Jan-Sept imports and exports grow 53%

The northern province of Quang Ninh reported VND10.8 trillion in imports and exports in the first nine months of 2022, a year-on-year rise of 53%.

As of September, Quang Ninh’s budget revenue reached an estimated VND40.6 trillion, a 21% surge over the same period last year.

Data showed domestic revenue hit over VND29.8 trillion, soaring 13% over the same period.

The province’s budget revenue was set at over VND55 trillion in 2022, up 5% from the year earlier, with VND13 trillion from import-export activities and VND42 trillion from domestic revenue.

As for budget expenditures, the province exceeded VND21,1 trillion, up 117% from the same period last year. Among them, public investment disbursement is estimated at over VND12.7 trillion, a year-on-year rise of 116%.

HCMC to set aside 20 land lots for social housing projects

HCMC will set aside 20 land lots covering over 38 hectares to build 1.3 million social homes for low-income earners in the city, the HCMC Department of Construction said in a recent report on the city’s social housing development plan sent to the Ministry of Construction.

These social homes will be located in the districts of 12, Binh Tan and Go Vap, the local media reported.

In the 2021-2025 period, some 519,000 people in HCMC will need social homes, while over 524,000 others, including workers, will need affordable homes in the next five years, according to the municipal department.

In addition, 20% of the areas of commercial housing projects will be earmarked to develop social homes. There will be 25 commercial housing projects in Thu Duc City, Binh Chanh District and District 7. Among them, 14 projects are ready for social housing development.

The department proposed the ministry quickly issue guidelines on the use of capital for infrastructure investment and site clearance compensation to build social homes on 20% of the area of commercial housing projects.

Vietnam striving to ensure information security in digital era

The Authority of Information Security (under the Ministry of Information and Communications) yesterday cooperated with Viettel Cyber Security and IEC Group to hold a roundtable discussion themed ‘Optimizing Resources – Increasing Performance for Investments in Information Security in the Digital Era’.

The discussion attracted senior managers of IT and Information Security organizations to exchange experience and new trends, strategies for cyber security. It also aimed at delivering optimal solutions for investments in cyber security of businesses sited in Vietnam.

Statistics from the Authority of Information Security reveal that in the first half of 2022, on average there are 44.7 cyber-attacks a day in Vietnam (a rise of 1.6 times compared to this time last year), leading to tough challenges in maintaining cyber security, especially during the national digital transformation process.

Head of the Institute for Information and Communications Strategies Nguyen Thanh Phuc shared that the trend of uploading data onto cloud servers becomes a lucrative chance for cyber criminals. The risk of information leak or loss has never been this high, yet most businesses and organization still exercise no practical method to lower this risk and protect themselves.

According to Robert Trong Tran, Deputy General Director of the Consultation Service for Technology Risk and Cyber Security (under E&Y Vietnam), the Covid-19 pandemic has forced businesses to neglect necessary security procedures, whereas cyber-attacks have become more complicated. It is wiser to focus on cyber security as much as on digital transformation, with a detailed strategy at hand.

Viettel Cyber Security said that it has always followed this proposal, and has integrated its services onto one platform for ease of administration. It has also synchronized investment projects for digital transformation and information security maintenance via strengthening its technological defense capacity. The organization suggested a balanced, safety, and strong digital transformation model among the three partners of investor – digital transformation partner – information security partner.

SBV announces to supervise commercial banks to correct activities

Following people’s complaints that they were encouraged to buy life insurance but in fact, they were forced to buy the insurance by bank staff when asking for loans at many commercial banks, the State Bank of Vietnam (SBV) announced to strengthen supervision of this matter.

According to customers, only when buying insurance, they can be disbursed or get loans at a lower interest rate.

The SBV has just issued a document about voters' complaints that customers are forced to buy life insurance at some commercial banks to get loans. The State Bank of Vietnam affirmed that the law on insurance business stipulates the principles, rights, and obligations of the parties involved in the insurance business and exploitation on a voluntary basis and on a client's financial ability.

The regulation also clearly states that insurance agency contracts signed with banks also do not require insurance products to be sold with or associated with banking products and services. The signing and performance of insurance agency contracts under the agreement between the insurance enterprise and the bank must abide by the law.

The SBV said that it will pay visits to commercial banks for reviewing this matter. It promised to have tough penalties on commercial banks which forced customers to buy insurance that is not really necessary when commercial banks grant credit to customers or approve loans for customers in accordance with regulations. The SBV affirmed that it will continue to strengthen the inspection and supervision of this activity, prohibiting commercial banks from persuading customers to buy insurance. If any violations are detected, the State Bank will throw a book on commercial banks in accordance with the provisions of law.

Hanoi to tighten management of land use
     
Ha Noi is to implement a new set of rules to govern the establishment and development of infrastructure and its support policies from September 26, according to a recently announced city mandate on land use.

The mandate covers most, if not all, industrial parks and residential projects located within the capital city's limit, which demands all projects must fall in line with the city's future planning and development goals. They must also comply to all existing land-use, security and environmental regulations.

According to the new mandate, the city's People Committee is to preside over all matters and ultimately decide on what projects are to get the go-ahead signal and who their investors will be.

Notably, the city is to set up bids for new projects with a total investment value of VND2.5 trillion and above or projects with sizes of 10ha within the metropolitan area and 25ha for the rest. District and commune-level people's committees are to be tasked with selecting the investors for projects located in their respective administrative areas.

Projects that require the approval of the National Assembly will also be put under the management and care of the city's People Committee and bids must be held to find suitable and capable investors under existing regulations.

The capital city's planning and investment department has been told to work closely with potential investors to identify, in a timely manner, socio-economic development issues and public concerns, as well as to propose solutions to address them.

There were more than 700 development projects within the city with a total land area of 5,000ha reserved that have been classified as moving with sluggish speed, according to a review conducted last month by the city's authority. Of which, many have received warnings but have not shown signs of improvement.

Chairman of the Ha Noi People's Committee Tran Sy Thanh said the city considers said projects as major hurdles to the capital's socio-economic development and an urgent matter that must be resolved quickly.

According to Thanh, out of some 135 projects that have not been granted land for development the city has proposed to cancel 12, with 45 more under consideration before a final decision can be made. The city has also reviewed over 400 projects that have been granted land for development. Of which, 105 have made significant progress, 71 have been given extensions and 37 have been proposed to be removed from the city's future development planning.

Director of the city's planning and investment department Bui Duy Cuong said the city is to ramp up efforts to study the rest in the third quarter of 2022. Depending on the result of said study, the city intends to remove projects that have failed to progress or are considered to be sluggish. 

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

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