Digitalisation can be described as the process of using IT to improve business models and increase capacity while creating new projects, and during the COVID-19 pandemic this process has been heightened even further. Analysts, however, have said that readiness among enterprises to embrace digitalisation remains quite low. 

Some enterprises sell goods and services by undertaking time-consuming and laborious steps such as seeking information on customers and passing this on to call centres. Thanks to AI call centres with management and sales features, however, these enterprises have seen an increase in business efficiency.

The application of IT in business first became considered the future 10 years ago, and such trends are even more relevant in the era of Industry 4.0, where IT solutions are critical for businesses to thrive. Amid COVID-19, the application of IT has proven to be far more superior than conventional business methods. Many Vietnamese enterprises, however, continue to meet obstacles in the digitalisation process.

The Government is creating the necessary conditions for enterprises to complete their digitalisation process in the fields of services, healthcare, and tourism, but progress has been slow. Over 90% of enterprises are proceeding at a very slow rate, with small and medium-sized enterprises becoming wary of the legal obstacles.

Digitalisation helps save time and money and improves the chances of finding new customers and increasing business efficiency. These potential advantages prompted the Government to aim for e-commerce to account for 20% of GDP by 2025. More micro policies and solutions will be implemented to reach the target, along with raising awareness among enterprises./.

PM requests effective solutions for economic recovery in coming years

Prime Minister Nguyen Xuan Phuc on August 19 chaired a meeting of the Government’s permanent members to discuss draft development plans for coming years, asking for effective and feasible solutions to minimise COVID-19-caused losses and recover the economy in both short and medium terms.

The event looked into the draft socio-economic development plan and State budget estimates for 2021, the draft financial-State budget plan for 2021-2023, along with the draft medium-term socio-economic development plan and public investment plan for 2021-2025.

PM Phuc stressed that economic development must be ensured amid the COVID-19 pandemic so as to provide jobs and guarantee people’s livelihoods.

He also underlined the need for staying proactive in governance and plan making, noting that facing serious impacts of COVID-19, effective and feasible solutions are necessary to ease losses and spur economic development in both 2021 and the medium term of 2021-2025.

He asked Government members to be unanimous to exert efforts to support socio-economic recovery this year, as well as the following years.

Noting countries around the world have taken measures like large-scale aid packages to minimise impacts of COVID-19, especially on people and businesses, the PM requested ministries and sectors, especially the Ministry of Finance, the Ministry of Planning and Investment, the Ministry of Labour, Invalids and Social Affairs, and localities, to devise timely support solutions that are strong enough to help affected people and enterprises.

Those solutions must be proactive, flexible and match the “new normal”. In particular, the fiscal and monetary policies should be more flexible to stimulate demand, create jobs and promote growth while still maintaining macro-economic stability, according to the Government leader.

Meanwhile, the State budget plan for 2021 should include funds for social security policies for workers facing job losses and those in the informal sector, and for vocational training to help labourers adapt to changes in supply chains.

PM Phuc also requested continued assistance for certain sectors heavily affected by the pandemic like transportation, tourism, textile-garment, health care, and education; along with policies to encourage rational consumption.

He demanded priority be given to development investment, especially in developing socio-economic infrastructure, including transport facilities, by using every possible resource.

The public investment plan for 2021-2025 needs to include projects and programmes important to national development like the ones on North-South Expressway, coastal roads, and digital economy, he added.

Construction of Viet Nam-Thailand wind power plant underway

Construction of the V1-2 wind power plant – a joint venture between the Truong Thanh Vietnam Group and the Thai-based Sermsang Power Corporation Public Company Limited – kicked off in the Mekong Delta province of Tra Vinh late last week.

Covering about 1,220 ha in Duyen Hai Town’s Truong Long Hoa Commune, the 48 MWp facility consists of 12 wind turbines. Costing in excess of VND2.23 trillion (US$96 million), it is expected to generate 162.97 million kWh of electricity each year.

It will also create dozens of new jobs once operational and contribute between VND45 billion and VND50 billion to the local budget annually.

Under wind power planning for Tra Vinh, which was approved by the Ministry of Industry and Trade (MoIT) in 2015, the province’s total capacity can reach about 1,608 MW. Local authorities have accepted five projects to date, which together are capable of generating 270 MW.

The provincial People’ Committee has made a proposal to include 17 more wind power projects, with total capacity of 2,400 MW, in the revised national electric power planning VII.

Vietnam sees rice prices grow

Vietnam 5% broken rice is being sold at higher prices than rice from competitors Thailand or India.

According to the Vietnam Food Association, for several days, the Vietnam 5% broke rice has been exported at USD493 to USD497 a tonne while Thai rice price dropped slightly to USD463 to USD467 a tonne. A tonne of Vietnamese rice price is USD27 higher than Thai rice, USD15 higher than Indian rice and USD80 higher than Pakistani rice.

Ly Thai Hung, director of Hung Cuc Company, one of the largest rice export companies in the northern region, said the price of Vietnamese rice was higher than Thai rice for the first time in 30 years.

"With such good prices and stable export volume, we may export more rice in 2020 than Thailand and will be the biggest rice exporter for the second time," he said.

As a result, farmers also have much better incomes. On the field, the IR 504 rice is sold at VND5,800 (24 US cents) a kilo, and the price for Jasmine rice is VND6,000. Most of the farmers in the Mekong Delta hae finished the Summer-Autumn crop. An Giang is the last to finish but harvested 5.53 tonnes per hectare over 230,000ha this year. This result is 80-150kg higher compared to last year’s crop.

The farmers will harvest the Autumn-Winter crop in over a month and it is predicted that this will be equally big. According to the Department of Agriculture and Rural Development, the farmers in Can Tho City have grown to Autumn-Winter crop on 68,163ha or 107% of the set goal.

Many farmers have also mechanized to improve productivity and quality. As of now, 95% farmers have rice planting machines.

According to the Ministry of Agriculture and Rural Development, the supply for Summer-Autumn crop is very high and will stay high thanks to the Autumn-Winter crop in over a month.

Fruit and vegetable exports to Thailand surges despite pandemic

The Ministry of Agriculture and Rural Development has reported that Vietnam’s fruit and vegetable exports to Thailand in the first seven months of this year have sharply surged.

Between January and July, Vietnam earned nearly USD2 billion from fruit and vegetable exports, down 12.3% on-year. 

The ministry attributed the decline to falls in the shipments of certain commodities, including dragon fruit, which made up the largest part of total exports at 34%, down 6%; bananas 9.5%; durian 71%; and watermelon 38.5%, according to Vietnam News Agency.

China was the leading buyer of Vietnamese fruit and vegetables in the period, accounting for 59%, but exports to the market fell by some 29%. Shipments to Singapore also dropped by nearly 1%.

Vietnam recorded higher fruit and vegetable exports to most of the remaining markets, including South Korea (up 25.5%), Thailand (234%), the US (10%), and Japan (13%).

However, during the period, Vietnam’s fruit and vegetable export to Thailand was estimated at USD79 million, up 234% on-year.

Dang Phuc Nguyen, General Secretary of Vietnam Fruit and Vegetable Association said that supermarkets operated by Thailand’s Central Group in Vietnam have intensified the purchase of Vietnamese fruit and vegetables for the distribution in its supermarkets in Thailand.

Meanwhile, the Thai market’s vegetable and fruit importing standards are not as strict as the EU and the US. Instead, the products only need to meet Vietnamese Good Agricultural Practices (VietGap) standards.

In the first half of this year, Chanh Thu Fruit Import & Export Co., Ltd only exported durians worth a total USD4 million to Thailand.

Local airlines offer ticket discount to boost market demand

A range of local airlines have simultaneously launched promotional campaigns with discounted tickets in an effort to stimulate greater demand among the local market.

A representative of national flag carrier Vietnam Airlines revealed that it will deploy a promotional scheme featuring discounted tickets priced from VND98,000, excluding taxes and additional fees. 

In line with this promotion, a discount will be applied on the price of flights operated by Vietnam Airlines or Pacific Airlines on routes between Hanoi and Da Nang, Chu Lai, Hue, and Vinh in addition to flights from Ho Chi Minh City to Da Lat, Nha Trang, Phu Quoc, and Quy Nhon, as well as flights between Ho Chi Minh City and Hanoi, Hai Phong, Thanh Hoa, and Vinh.

Tickets are set to be sold on the airline’s website at www.vietnamairlines.com and www.pacificairlines.com, the mobile app, in addition to official ticketing offices and agents, and will be applicable to itineraries from September 7 to March 31, 2021, with customers urged to book between August 19 and September 2.

Furthermore, a representative of low-cost carrier VietJet Air also launched a super savings promotional campaign with tickets priced from only VND 2,021, excluding taxes and fees. This scheme will apply to all domestic flights departing from northern and central provinces to the south during the Lunar New Year festival, known locally as Tet.

This promotion will run from August 18 to August 22, with more than 2.6 million special tickets available for flights scheduled to run from August 18 to February 28, 2021.

Passengers will be able to purchase tickets through the airline’s website at www.vietjetair.com, the mobile app, the Facebook page at www.facebook.com/vietjetvietnam, and through official VietJet Air ticketing offices and agents.

Enterprises suspending operations due to Covid-19 to enjoy land rent reduction

Enterprises, organizations, households and individuals that lease State-run land lots and have suspended their operations for at least 15 days due to the Covid-19 pandemic will be entitled to a 15% reduction in their land rents this year.

The prime minister has issued Decision 22 on the reduction of land rents in 2020 for those affected by the pandemic, Nguoi Lao Dong newspaper reported.

Accordingly, the policy will be applicable to land rents in 2020 only, not in previous years, and inapplicable to fines for late land rent payments.

Lessees that conduct production and business activities but have had to suspend their operations on the land lots leased by the State will also be entitled to the policy.

Dossiers for the land rent reduction must include lessees’ applications for the reduction and copies of the competent agencies’ decisions to lease land or land lease contracts.

Lessees must take responsibility before the law on the accuracy of the information provided by them and make sure they are eligible for the land rent reduction.

The prime minister’s decision also states that lessees must submit dossiers for land rent reduction to tax agencies, the management boards of economic zones or hi-tech parks and other agencies in accordance with the law from August 10 to December 31.

The competent agencies must determine the reduced amounts and issue decisions on the reduction for no more than 20 days since they receive the lessees’ lawful dossiers.

If lessees receive a reduction in land rent but are later found to be ineligible for the policy, they must pay back the reduced amounts to the State budget and fines for late payments calculated based on the reduced amounts, in line with regulations on tax management.

Banking sector looks to promote non-cash payment

Promoting non-cash payment, digital banking, and green banking is the direction of the banking sector in the 2020-2025 tenure, State Bank Governor Le Minh Hung told a meeting in Hanoi on August 17. 

Besides restructuring credit institutions, banks should increase investment in renewable energy, clean energy and less carbon consumption and production industries, he suggested.

Particularly, to support businesses affected by the COVID-19 pandemic, the sector needs to synchronise monetary, credit, interest rate, and payment tools and solutions to soon recover the economy, the  official suggested.

He noted that in the 2015-2020 period, the banking sector has adjusted monetary policies to curb inflation at a low level, while stabilising the macro economy and monetary market.

The sector also had the policy against the dollarisation in the local economy by converting foreign currency and gold into cash in service of socio-economic development, he added.

Investors from tax havens set up shop in Vietnam

An increasing number of investors from tax havens such as Cayman, Bermuda, British Virgin Islands, Luxembourg, Ireland, Mauritius and Malta have invested in Vietnam, with July marking the first time that an investor from the Southern European island country of Malta has invested in Vietnam, according to the Foreign Investment Agency.

With a registered capital of US$600,000, the project helps Malta become a fresh foreign investor in Vietnam.

Until now, 137 countries and territories have invested in Vietnam but many of them have developed very small projects.

Lebanon has invested in five projects in Vietnam but their combined registered capital is just US$525,000, while Iran has invested only US$83,500 in five projects.

Vietnam’s other small foreign investors include Portugal, with four projects worth over US$200,000 and Mexico, with four projects worth over US$170,000.

Bangladesh has invested in 15 projects in Vietnam but the total registered capital is below US$1 million.

Along with Malta, Guinea is also a fresh foreign investor in Vietnam this year, with a project worth US$10,000, the smallest foreign project here.

So far, there have been 21 countries and territories that have invested in only one project in Vietnam and 18 others that have developed two projects.

Data of the Ministry of Planning and Investment showed that South Korea is still Vietnam’s largest foreign investor, with nearly 8,860 projects worth over US$70 billion up to now, accounting for 18.4% of the country’s total foreign direct investment. Japan comes second with nearly 4,570 projects worth US$60.2 billion, followed by Singapore with over 2,500 projects worth some US$55 billion.

The top 10 investors also include Taiwan, Hong Kong, British Virgin Islands, China, Malaysia, Thailand and the Netherlands.

Vietnam emerges as destination for international industrial property investors

With the participation of major foreign investors such as Logos and GLP in the local market, the nation looks set to continue being a popular destination for international industrial property investors moving forward.

A media representative of Logos, a member of the ARA Asset Management Co, Ltd, officially confirmed that the firm is in the process of mobilising capital of US$1.2 billion in order to invest in both the country and in the Republic of Korea. 

Of the figure, approximately US$400 million is set to be poured into Logos's core business based in Vietnam. including e-commerce logistics along with food and cold storage.

Furthermore, GLP, a Singapore-based global corporation that specialises in logistics, real estate, infrastructure, finance, and technology, is reportedly eyeing the Vietnamese market. Despite this speculation, information regarding the group's investment in the Vietnamese market has yet to be confirmed.

Most notably, the impending participation of giant foreign investors in the country proves that the Vietnamese market is fast becoming a magnet for international industrial real estate investors.

At present, the industrial real estate market locally remains in the early stages of development, with participation mainly led by major foreign investors such as VSIP, Mapletree, DEEP C, WHA, and Ascendas, as well as domestic companies such as KTG, Beijing, and Becamex.

Paul Tonkes, director of Industrial and Logistics Services at Cushman & Wakefield Vietnam, said Vietnam is one of the most competitive manufacturing hubs in the world, ranking second only behind China.

Moreover, last year, the country also came in fourth place in an annual ranking of the most suitable locations for global manufacturing, with the list featuring 48 countries in Europe, the America, and the Asia-Pacific region.

Data from Focus Economics indicates that the nation’s Industrial Production Index enjoyed a bounce back in June with a year-on-year increase of 7%, the majority of which was driven by recoveries in manufacturing and electricity production.

Industrial output is projected to grow by 2.71% during the year and is expected to expand to 9.2% by 2021, indicating a number of positive signs for growth within the sector.

Kien Giang cracking down on illegal fishing

The Mekong Delta province of Kien Giang is identifying the measures needed to have the “yellow card” warning from the European Commission (EC) for illegal, unreported, and unregulated (IUU) fishing removed, according to local authorities.

Director of the provincial Department of Agriculture and Rural Development Nguyen Van Tam said that as of December this year, all the fishing vessels measuring 15 metres or longer will have been equipped with vessel monitoring systems.

The province will also strengthen the management of fishing boats and fishermen, preventing them from violating foreign waters to conduct illegal fishing.

It will also increase patrols at fishing ports to quickly detect and handle infringements.

Joint patrols will be conducted with the seven Mekong Delta provinces of Binh Thuan, Ben Tre, Tien Giang, Tra Vinh, Soc Trang, Bac Lieu, and Ca Mau.

Local agencies have been directed to coordinate with naval and coast guard forces to intensify patrols.

Since the beginning of this year Kien Giang has handled 12 violations and imposed fines totalling nearly VND12 billion (US$519,520).

More than 3,410 fishing vessels had tracking devices as of July.

Many hotel owners sell their properties due to Covid-19

Apart from laying off staff, several hotel owners in Vietnam have also had to resort to selling their properties at low prices due to the Covid-19 pandemic.

In the early days of the pandemic, many small hotels were sold. But until now, some owners of four- or five-star hotels, which are supposed to have large capital reserves, have also had to put their properties up for auction or seek buyers.

A five-star hotel in HCMC is seeking buyers at US$160 million, while a riverside hotel has an offer price of US$425 million.

In the coastal city of Nha Trang, a beachfront five-star hotel has an offer of VND1.5 trillion (US$65 million), while a four-star hotel on Phu Quoc Island has an offer of VND700 billion.

A businessman told The Saigon Times that there could be more hotel owners selling their properties in the time to come because the hospitality market has been down for too long and it would need at least one year to recover. 

Several hotel developers who operate a hotel chain have had to sell one or some of their hotels to have money for debt payments.

Some businesses said the current hotel prices are much lower than they were before the outbreak. A four-star hotel with 80 rooms in HCMC was priced at over VND600 billion before the outbreak but it will now sell for only VND400 billion.

A hotel in HCMC has seen its offer price much lower than it was before the outbreak but it attracted only a few buyers because it has too many shareholders, which will take a long time to finalize a deal.

Tran Thi Thanh Tam, director of Chez Mimosa Hotel Management and Consulting Company, said the factors that define a hotel’s price are location, area, quality of facilities, reputation, current business situation and future expectations.

The grade of the rooms will also affect the price. Suites require an investment of 1.5 or two times higher than that of regular rooms so hotels with more suites will sell at a higher price.

Some businesspeople told The Saigon Times that most investors are very careful while buying hotels and commonly hire professional consultants to evaluate their prices as well as the long-term risks.

Online shopping spikes amid new COVID-19 outbreak

Retailers are focusing on online shopping as more and more consumers are seeking to avoid public places amid the new COVID-19 outbreak.

Le Thi Thanh Lam, deputy general director of Sai Gon Food Joint Stock Company, said during the first outbreak, consumers panicked and stocked up on goods, and so online shopping saw impressive growth.

While they are more composed this time, online shopping is still seeing huge growth on Sai Gon Food’s websites since they are familiar with them and they frequently offers good deals, she said.

A spokesperson for online platform Tiki told Nguoi Lao Dong (Labourers) newspaper that ever since the first COVID-19 cases appeared in Da Nang city late last month, demand for health-related products has spiked, especially face masks, demand for which grew 12-fold, and hand sanitisers, which saw sales double.

Other sought-after products have been air filters, school text books, bottled drinks, and canned foods, they said.

Tran Tuan Anh, managing director of Shopee, said his company has been working with suppliers and brands to meet growing demand.

The change in consumer shopping behaviour caused by COVID-19 has forced businesses to focus on their online shopping platform sooner than they had originally planned.

For example, wholesaler MM Mega Market had to launch its shopping website sooner than planned to offer products in demand, and other products will be added later.

Lotte Mart Vietnam’s shopping website, speedl.vn, saw massive growth during the outbreaks in March and July and had to double its online department payroll.

Many businesses have said that there is a fierce competition to offer the best prices online.

Shopping platforms are also offering sellers advertising packages that are featured more prominently and reach more customers.

According to the HCM City Department of Industry and Trade, retail revenues in the first seven months of the year were 8.2% up year-on-year to VND463.45 trillion (US$20 billion). 

Thousands of retailers, wholesalers fear dissolution due to Covid-19

With customers cutting back on purchasing non-essential items due to the Covid-19 pandemic, over 8,000 retailers and wholesale businesses have halted their operations and fear they may soon have to shut shop for good.

Data from the Business Registration Agency under the Ministry of Planning and Investment indicated that between January and July, firms active in the retail and wholesale sectors accounted for the largest proportion of the total firms awaiting dissolution, with over 8,100 retailers and wholesalers.

Businesses operating in the processing and manufacturing industry came second with over 2,510 firms, followed by enterprises active in the construction sector, with 2,350 units.

K. Oanh, owner of a fashion shop on Huynh Van Banh Street in HCMC, noted that she returned the rented premises in late June as the shop’s sales dipped due to the coronavirus pandemic. The revenue was not enough to pay the salaries of employees and cover rent.

Many other stores and shops in HCMC, despite opening their doors, are hanging transfer signs at the entrance due to fewer buyers. Other major cities in the country have also seen poor trade activities.

Over the past seven months, the country saw over 21,800 firms suspend their operations and head toward dissolution, down 12.2% year-on-year.

Transport projects connecting HCMC and southern provinces snailing

Several transport projects connecting HCMC and the southern provinces are moving at a snail’s pace or have been suspended, Giao Thong newspaper reported.

The project of expanding the city’s northeastern gateway remains incomplete even though work on it commenced 10 years ago.

Some parts of the section crossing the districts of Thu Duc and 9 have not been expanded, while the 2.2-kilometer-long section in Binh Duong Province has made little progress due to site clearance problems.

The site clearance cost for this section has increased to VND2.78 trillion, two times higher than the initial plan. The two localities have worked together several times but the problem has not yet been resolved.

The HCMC government planned to expand a section of the National Highway 13 connecting the city with Binh Duong Province to 60 meters in width 15 years ago but the project has not been kicked off until now. The Binh Trieu 2 Bridge, a part of the project, is the only component that has been completed.

The HCMC Department of Transport recently sent a proposal to the city government to turn the project from the build-operate-transfer format to a public project. However, the department has not completed negotiations with the current investors.

Similarly, the city planned to expand a section of the National Highway 22 connecting with Tay Ninh Province under the public-private partnership format three years ago but the project has not yet commenced. The city has only repaired the road surface of some deteriorated parts.

A section of the National Highway 1 connecting the city’s Binh Chanh District with the Mekong Delta province of Long An has yet to be expended although it has been overloaded for years.

Tran Quang Lam, director of the HCMC Department of Transport, said the city will need more than VND900 trillion to improve its transport infrastructure in the next 10 years.

Dr. Tran Quang Thang, director of the HCMC Institute for Economics and Urban Management Study, noted that HCMC’s budget retention rate of 18% is too low, leaving the city with hardly any money to invest in transport projects.

Vo Kim Cuong, former deputy chief architect of HCMC, stated that the city’s budget retention rate should be raised to meet its capital demand for transport development. Improved transport infrastructure will contribute to the development of not only the city but also of the southern region and the country.

Cashback websites, apps show signs of multi-level marketing: ministry

Many cashback websites and apps in Vietnam are indulging in illegal multi-level marketing, the Vietnam Competition and Consumer Authority (VCCA) under the Ministry of Industry and Trade has warned.

Cashback websites and apps pay their users a percentage of the money earned when they purchase goods and services via affiliate links, bank cards or digital wallets.

“Cashback is a business-to-consumer e-commerce model that enterprises and service providers use to increase customer loyalty and reach out to more customers by offering users a reward when they make a purchase or refer new customers to the cashback websites or apps,” a representative of the VCCA said.

Although the cashback model has recently emerged popular, the VCCA has found that many cashback websites and apps in the country have shown signs of multi-level marketing and nontransparent operations.

Some cashback websites and apps lure users with rewards equivalent to 80-100% of each purchase they make. However, the reward is mostly presented in points and the users receive only a fraction of the reward in cash.

Besides this, the accumulation points of some cashback websites and apps are related to certain types of cryptocurrency or e-wallets such as Gem, CBP, Silling, USDT, ETH, ONE and VNDC, which are not recognized by the Vietnamese law. Therefore, consumers will not be protected by the law in case of disputes.

Some cashback websites and apps also invite users to upgrade their accounts to a higher level such as Silver, Gold, Platinum, Diamond, Global Executive Commission or Millionaire to enjoy higher benefits.

To avoid legal and financial risks, the VCCA suggested that consumers should not become members of cashback websites and apps that indulge in one of the activities listed above. SGT

Samsung rejects info on smartphone production shift from Vietnam to India

A representative of Samsung Vietnam has rejected information that the firm would shift part of its smartphone production from Vietnam to India.

Samsung’s smartphone production plants in Bac Ninh and Thai Nguyen provinces remain operational, Tuoi Tre Online reported, citing the source.

Samsung Vietnam is still playing a key role in the group’s global smartphone production, the representative said.

According to the Indian journal Economic Times, Samsung had earlier submitted a plan to diversify its smartphone production lines to the Indian Government. Accordingly, the group would shift part of its production from Vietnam and other countries to India.

Vietnam is not only an attractive investment destination, but also the group’s second home, the Samsung representative told Tuoi Tre.

Samsung has been Vietnam’s biggest foreign investor with its total investment in the country amounting to US$17.3 billion to date, a 26-fold increase from that of 2008, when its first cell phone plant, Samsung Electronics Vietnam, worth US$670 million opened in Bac Ninh Province.

Up to now, Samsung Vietnam is running six plants and one research and development center, with the two smartphone facilities in Bac Ninh and Thai Nguyen being Samsung’s largest smartphone plants in the global market.

Apart from this, Samsung Electronics HCMC Complex is the biggest electronics plant in Southeast Asia. SGT

Japanese businesses seek to take advantage of Vietnam potential

Japanese enterprises are expanding investment in sectors that are seen to have growth potential in Vietnam, according to experts.

Japanese company Nikkiso Vietnam MFG Co.,Ltd. last month decided to pour an additional 3 million USD into its medical equipment factory at the Tan Thuan Export Processing Zone in Ho Chi Minh City.

The company said the money would be used to install more machinery and equipment to increase the production of blood tubing lines used for haemodialysis to 24 million a year.

Nikkiso Co., Ltd, the parent company, also has a factory to produce the lines in Thailand, but it decided to increase production in HCM City.

Many Japanese supporting-industry projects have been licensed this year in many localities in the south, including large ones such as Furukawa Automative Systems in Vinh Long (48.8 million USD) to produce electric wires for cars.

In Dong Nai province, SMC Manufacturing (Vietnam) Co., Ltd. at the Long Duc Industrial Park, which produces automatic devices for offices, factories and warehouses, has increased its investment by 70 million USD.

Lixil Global Manufacturing Vietnam Co., Ltd has registered to increase its capital by 25 million USD, making it the largest Japanese company in the province.

Masahiko Makata, CEO of Long Duc Investment Co., Ltd., which builds the seven-year-old park’s infrastructure, said almost all the space has been leased out.

Many Japanese companies want to continue investing and the company seeks to expand the park in the second phase.

According to the Japan External Trade Organization (JETRO), of 30 companies selected by Japan’s Ministry of Economy, Trade and Industry from 124 applicants to receive support to expand in Southeast Asia, 15 chose Vietnam to invest and expand production.

This was a testimony to Vietnam’s attractiveness, said Takeo Nakajima, Chief Representative of JETRO in Hanoi. In the long term, they also aim to take advantage of the opportunities arising from the country’s free trade agreements.

Takeo said the process of diversifying value chains by the Japanese enterprises began a while ago, and the COVID-19 pandemic requires firms to diversify production to two to three destinations to avoid supply chain disruptions though production costs might rise as a result.

Japanese firms established supply chains in China and the Republic of Korea, and expanded in recent years to Southeast Asia, which is an important investment destination, he said.

The Japanese Government has earmarked 70 billion yen (653 million USD) to support firms that diversify their supply chain out of China.

Experts said this would help boost investment by Japanese firms in Vietnam.

Japanese investments are expected to flow into sectors like medical equipment, agricultural and food processing, agriculture, education, and manufacturing, they said.

Ninh Thuan ordered to suspend renewable projects

After inspecting the approved renewable projects in the central province of Ninh Thuan, the Government Inspectorate has urged the provincial government to work with investors to temporarily suspend or reduce investments in such projects.

According to the inspectors, there remain some shortcomings in the procedures over land transfer and land lease documents conducted in the province. Some solar power projects use land that was zoned for irrigation projects.

Based on the projects’ power transmission facilities and investment progress, the provincial government has to review and reach a consensus with the investors over halting and slowing down investments in solar power projects for which they have sought an investment approval from authorities but have yet to break ground on. This is aimed at minimizing the number of projects whose power generation capacity has decreased after being put into commercial operation.

The provincial government was required to ensure that 15 operational projects and five other projects that were completed last year generate 100% of their capacity, and review seven wind projects that received investment approvals but have not had their plans to get hooked to the national grid appraised and approved by the Ministry of Industry and Trade.

The Inspectorate asked the province to suggest to the Industry and Trade Ministry to consider and appraise projects that can fully produce power.

In recent years, Ninh Thuan has become an investment hotspot for renewable projects, especially solar and wind ones thanks to its huge potential and advantages of wind and sunlight. Over the past three years, investors have rushed to pour capital into renewable projects in this locality to enjoy incentives for high power buying prices offered by the Government.

However, as the incentives were only valid to projects approved before November 23, 2019, and connected to the national power grid prior to December 31 this year, investors developed their projects at all costs, thus leading to many projects seeking investment approval while they were yet to be permitted to connect to the national grid or have electricity purchasing contracts, leaving an impact on the national grid. SGT

Finance Ministry cuts road use fee by 10-30%

The Ministry of Finance has issued Circular No.74/2020/TT-BTC to reduce the road use fee by 10-30% from now until December 31, 2020, to support those affected by the Covid-19 pandemic.

Accordingly, the road use fee will be cut by 30% for passenger cars and public buses and by 10% for trucks, special-use cars and tractors.

Private cars that have been turned into passenger cars will enjoy the incentive from the date they are identified as passenger cars in the accreditation management program by the Vietnam Register.

From January 1, 2021 onwards, the road use fee will return to normal as regulated by Circular No. 293/2016/TT-BTC, according to the Government’s news website.

Indonesia records BoP surplus of 9.2 billion USD in Q2

Bank Indonesia (BI) reported on August 18 that the balance of payments (BoP) of the country had a surplus of 9.2 billion USD in the second quarter of 2020.

According to a report from the bank, the BoP experienced a deficit of 8.5 billion in the first quarter.

BI said the improvement in the BoP was supported by a decrease in the current account deficit (CAD) and a large surplus in the capital and financial account.

In line with the development of the BoP surplus, the position of foreign exchange reserves at the end of June stood at 131.7 billion USD, it added.

The current account deficit of Indonesia was recorded at 2.9 billion USD or 1.2 percent of gross domestic products (GDP), lower than the deficit in the previous quarter of 3.7 billion USD or 1.4 percent of GDP. The decline in the CAD stemmed from a surplus in the goods trade balance due to lower imports due to weakening domestic demand.

Meanwhile, the capital and financial account surplus was recorded at 10.5 billion USD mainly from net inflows of portfolio investment and direct investment, after recording a deficit of 3.0 billion USD in the first quarter of 2020.

Direct investment also contributed to the surplus on the capital and financial account, in line with the domestic economic contraction of the Southeast Asian nation, the bank said./.

Vinh Phuc emerges as destination of choice for investors

The northern province of Vinh Phuc has been a destination of choice for investors, both domestic and foreign, amid the COVID-19 pandemic.

Representatives from the province’s Department of Planning and Investment said factors that help draw investors to the locality include the availability of clean infrastructure, convenient transport and reasonable land lease prices.

As of the end of June 2020, Vinh Phuc was home to 392 foreign direct investment (FDI) projects with total registered capital of 5.57 billion USD, according to statistics of the department. The projects were run by investors from 18 countries and territories. The Republic of Korea has the most projects with 210, followed by Japan, China and Thailand.

Many global groups have made their presence in Vinh Phuc, such as Toyota, Honda, Sumitomo from Japan, Piaggio from Italy, De Heus from the Netherlands, Daewoo, Haesung Vina, Partron Vina, Cammsys from the Republic of Korea, Prime Group from Thailand and Weldex from the US.

The province has also attracted 782 domestic direct investment (DDI) with total investment surpassing 93.7 trillion VND (around 4 billion USD at current exchange rate). Several major Vietnamese corporations have chosen Vinh Phuc for their investment, such as FLC, Vingroup, SunGroup, and Viet Duc Steel.

The flow of investment capital, both FDI and DDI, into the province in the first six months of this year decreased as a consequence of the coronavirus pandemic. Total FDI capital in the period stood at 135.6 million USD, equivalent to only 32.1 percent of the figure in the same period last year. The money was poured into 14 new projects and 19 existing ones.

Meanwhile, DDI capital attraction in the period came to 2.67 trillion VND, equivalent to 51.5 percent of the figure in the same period of 2019. The capital was pumped into 24 new projects and 9 existing ones.

Officials from the Department of Planning and Investment said the provincial authorities will continue to push forward with administrative reform, focusing on streamlining administrative procedures to reduce time and costs for enterprises. Vinh Phuc will promote the application of information technology (IT) in administrative procedures with the goal of creating the best possible environment for production and business, thus enhancing the attraction of FDI and investment from society.

At the same time, attention will be paid to removing difficulties and obstacles faced by businesses in various fields, from business registration to business conditions, customs clearance and taxation.

During the period of social distancing to curb the spread of the COVID-19 pandemic, agencies in Vinh Phuc still maintained their connections with investors through many channels, providing them with consultations and latest information. The province has also intensified online investment promotion activities, so as to attract investors after the pandemic is put under control.

Vinh Phuc has designated 18 industrial parks with total area of 5,228 ha in a master plan to 2020 approved by the Prime Minister. By now nine industrial parks have received investment certificates. Industrial parks in Vinh Phuc have good technical infrastructure and professional management, thus contributing to attracting investors to the province. They reported an average occupancy rate of nearly 62 percent.

Thanks to the province’s endeavours to complete infrastructure in industrial parks and a transport system connecting them, as well as efforts to improve the business environment and reform administrative procedures, Vinh Phuc has become more popular among foreign investors.

The province reported total industrial production value of 11 trillion VND in the first six months of this year, down 9 percent year on year, which it attributed to the impact of the COVID-19 pandemic. The output of most main products declines, such as automobile down 24.8 percent, motorbike 14.4 percent, and electronic parts 7.7 percent.

More admin procedures integrated into national public service portal

The General Department of Taxation (GDT) reported on August 18 that it has completed the integration of additional 27 administrative procedures into the national public service portal, lifting the total number of online public services provided through the portal to 120.

As a result, the tax sector has exceeded the target set by the Government and the Ministry of Finance, reaching nearly 130 percent of the plan for 2020, it said.

According to GDT, via the portal, submissions of more than 14 million taxpayers have been sent to tax agencies for handling since May 2020.

The 1,000th public service on the portal, which is expected to be launched on August 19 on the portal, will be the service of declaration and payment of registration fee and submission of automobile and motorbike registration declarations, it said.

To achieve the above-mentioned results, the tax sector has made constant efforts in renovating and upgrading the information technology system, integrating the tax management system into the national public service portal.

The sector plans to continue upgrading and integrating all tax administrative procedures into the portal, thus making it easier for people and businesses in fulfilling their tax obligations to the State budget.

In order to promote administrative reform and create more favourable conditions for businesses and people, Prime Minister Nguyen Xuan Phuc issued Decision No. 411/QD-TTg dated March 24, 2020 approving the list of integrated public services available on the national public service portal in 2020.

Binh Dinh wants two large projects to seek FDI

 Binh Dinh Province has proposed two large projects to be added to the list of those calling for foreign direct investment (FDI) in a recent report sent to the Ministry of Planning and Investment.

One is an automobile plant project with a capacity of 30,000-50,000 units per year, covering 50 hectares in Becamex – Binh Dinh Industrial, Urban and Service Complex. The project is expected to need an investment of US$250 million.

Mitsubishi Motors Viet Nam is looking for an appropriate destination for its second plant in Viet Nam with an investment of about $250 million.

At a working session with Binh Dinh authorities in June, Mitsubishi Motors Viet Nam’s general director Kenichi Horinouchi said the south-central coastal province was among the company’s top choices thanks to the developed transport and technical infrastructure system coupled with a huge clean land fund which was favourable for building automobile component plants.

Chairman of the provincial People’s Committee Ho Quoc Dung said he expected Mitsubishi Motors would invest in the province, pledging favourable policies for foreign investors, especially the automobile plant.

Dung said the province was speeding up administrative reforms and improving the investment climate, which together with the availability of clean land would create favourable conditions for foreign investors.

The second project is a 300-bed hospital in Nhon Hoi Economic Zone which would cover an area of 3.5 hectares and have total investment of $15 million.

The previous list of projects seeking investment in Binh Dinh included four, of which a $24 million hospital and a $4 billion thermo-electricity centre are no longer seeking investment as projects are no longer appropriate to the province’s development planning.

The other two projects, including Cat Nhon solid waste treatment project with an estimated investment of $75 million and a road upgrade project worth around $100 million, found investors.

According to the provincial Economic Zone (EZ) Management Board, Nhon Hoi EZ and other industrial zones (IZs) in the province attracted 33 FDI projects as of February, worth $506 million in registered capital. Twelve countries and territories have invested in Ezs and IZs in the province with China, Singapore and Japan being the largest investors.

The Ministry of Planning and Investment’s statistics showed Binh Dinh attracted more than $2.3 million FDI in January-July, with two new projects and one existing project raising its registered capital. 

Source: VNA/VNN/VIR/VNS/VOV/SGT/Dtinews