The Ministry of Construction has proposed short- and long-term measures to ease the difficulties facing the country’s real estate market, with social housing development to drive the market forward. 

At its regular press conference in Hanoi on June 16, the ministry said the Government has provided an additional 2 trillion VND (86.9 million USD) for four commercial banks to facilitate lending for social housing projects and buyers. 

It also suggested the Prime Minister cut lending rates on social housing to about 4 percent from the existing 4.8 percent. 

The ministry also proposed amending and supplementing several contents in the Government's Decree No 100/2015/ND-CP on social housing development, including those regarding financial obligations and State management, among others. 

It is necessary to allow developers to be granted extensions on paying land use fees and for borrowers to be permitted to make debt repayments later in the year. 

In the long term, State management agencies will continue fine-tuning the legal framework on real estate investment and step up administrative reform in the field of construction.

Vietnam enjoys sharp increase in export of rice and medical masks

In total, the country exported more than 321 million medical masks throughout the reviewed period, with up to 180 million masks being shipped abroad during May alone following the lifting of restrictions regarding the export of medical masks.

This figure represents a 1.3-fold-increase in comparison to the total export volume during the four-month period.

In recent times, medical masks have started to be regarded as a special export item since the outbreak of COVID-19 epidemic began in China before spreading globally.

Within the domestic market, the price of face masks has remained stable and they are being widely sold at various distribution channels at reasonable prices.

In addition to the sale of medical masks, the country also shipped large quantities of rice abroad during the reviewed period, with the rice export volume reaching approximately 954,000 tonnes in May alone, making over 492 million USD, representing an increase of over 87% in volume and a 93% boost in value compared to the previous month.

By the end of May, rice export volume stood at 3 million tonnes, grossing 1.5 billion USD in revenue.

Group of investors invest 650 million USD in Vinhomes

A group of investors led by US-based private equity firm KKR, including Temasek Holdings of Singapore, invested 15.1 trillion VND (650 million USD) in a stake of the Vinhomes Joint Stock Company (Vinhomes).

With this investment, the Ho Chi Minh Stock Exchange (HOSE) witnessed transactions with a combined value of over 1 billion USD on June 15, a record amount since the opening of the Vietnamese stock market.  

The group purchased a 6 percent equity stake in Vinhomes. KKR is making the investment primarily from its Asian Fund III.

Following the transaction, the Vingroup Joint Stock Company will continue to be the controlling shareholder of Vinhomes.

Vinhomes is a subsidiary of Vingroup and is listed on the HOSE. Vinhomes develops and trades integrated residential, commercial and industrial real estate, and provides real estate management and related services.

KKR is a leading global investment firm that manages multiple alternative asset classes, including private equity, energy, infrastructure, real estate and credit, with strategic partners that manage hedge funds.

Japan completes procedures to amend trade agreement with ASEAN

Japan has completed its legal procedures necessary for the entry into force of the First Protocol to amend the ASEAN-Japan Agreement on Comprehensive Economic Partnership (AJCEP), announced the country’s Ministry of Foreign Affairs on June 16.

The Protocol will enter into force in Japan and four ASEAN nations of Laos, Myanmar, Singapore and Thailand that have completed necessary legal procedures on August 1.

In a press release, the Japanese Ministry of Foreign Affairs voiced its hope that the Protocol will promote further trade and investment between Japan and ASEAN and will strengthen the Japan-ASEAN cooperative relationship.

ASEAN members and Japan began talks on the AJCEP in 2005. The agreement took effect three years later, focusing on trade, while talks regarding investment and services were underway.

It was the first multilateral free trade agreement of Japan.

The First Protocol to Amend the Agreement on Comprehensive Economic Partnership was signed by Japan on February 27, 2019, and by ASEAN members in March and April, 2019.

Article 8 of the Protocol stipulates that it shall enter into force on the first day of the second month following the date by which the notifications in writing that legal procedures necessary for entry into force of the Protocol have been completed have been made by Japan and at least one ASEAN nation.

In relation to an ASEAN member who will make such notification in the coming time, including Vietnam, the Protocol shall enter into force on the first day of the second month following the date on which the notification is made.

According to Japan’s Ministry of Finance, the country earned 16.6 trillion JPY (117 billion USD) from exports to ASEAN in 2018, while purchased goods worth 12.4 trillion JPY (115.5 billion USD).

Investment intention approved for three golf courses

Deputy Prime Minister Trinh Dinh Dung has signed decisions approving the investment intention for three golf courses, two in northern Bac Giang province and one in northern Hoa Binh province.

Specifically, the Trang An Golf company will invest in the 36-hole Viet Yen Golf Course which covers 140ha of land in Huong Mai and Trung Son communes, Bac Giang’s Viet Yen district. The 50-year project will have total investment of over 1.2 trillion VND (52 million USD).

The Truong An Luc Nam Golf Company will invest over 739 billion VND in a golf course in Luc Nam district, Bac Giang province.

The project in Hoa Binh is invested by An Viet Hoa Binh Golf company with total capital of over 1.13 trillion VND.

Cambodia cuts 2021 State budget due to COVID-19

The Cambodian Government on June 16 announced a plan to reduce the 2021 State budget to 4 billion USD due to the impacts of COVID-19.

The figure accounts for about a 50 percent drop from this year’s State budget, including a 11.3 percent decrease for social affairs and 6.4 percent for general administration.

Last year, the Cambodian National Assembly approved the government’s plan to spend 8.2 billion USD in 2020, a 22 percent increase compared with 2019.

The Khmer Times the same day quoted Cambodian Prime Minister Hun Sen’s directive as saying that Cambodia’s economic growth in 2020 is predicted to be negative 1.9 percent.

The Fresh News also said the Cambodian Government earmarked 1 billion USD for the fight against the pandemic and economic recovery.

PM Hun Sen also said with optimism that the Cambodian economy could grow by 3.5 percent next year thanks to global economic recovery and external demand.

Hanoi works to boost consumption post-COVID-19

Hanoi has launched a two-month promotional campaign aimed at stimulating consumption and easing the difficulties facing local businesses following the COVID-19 pandemic. 

More than 600 companies applied from May 27 to June 9 to be part of the campaign, putting forward nearly 800 promotional offers worth 1.2 trillion VND (52.1 million USD) and discounts of up to 70 percent, mostly in electronics, with offers worth over 360 billion VND, consumer goods, with more than 240 billion VND, food with 360 billion VND, and others, such as apparel, real estate, pharmaceuticals, education, and medical equipment, with 240 billion VND.

The origin of all products in the campaign, which will last until July 31, will be traced, to protect consumers’ rights and companies’ interests.

Vice Chairman of the Hanoi People’s Committee Nguyen Van Suu said that as the city has largely brought COVID-19 under control, the municipal Department of Industry and Trade launched a number of domestic consumption drives in May and June that attracted nearly 300 companies from more than 30 cities and provinces, bringing the total retail sale of goods and services to 46.9 trillion VND in May, up 45.9 percent month-on-month and 2.9 percent year-on-year.

A number of similar activities are also planned for the remainder of the year.

Thailand approves 720-million-USD domestic tourism stimulus package

The Thai cabinet on June 16 approved a domestic tourism package worth 22.4 billion THB (720 million USD) to revitalise a key sector hit by the COVID-19 pandemic.

Deputy government spokeswoman Traisuree Taisaranakul said the stimulus, proposed by the Tourism and Sports Ministry and the Finance Ministry, will run from July to October.

The first 18 billion THB of the package will fund subsidies for accommodation, food and other services provided at tourist destinations.

A further 2.4 billion THB will fund holiday travel for 1.2 million health volunteers and officials of sub-district hospitals, who will use the services of tour firms.

The remaining 2 billion THB is to subsidise domestic flight fares for a total of 2 million trips.

Tourism, which accounts for around 20 percent of Thailand’s GDP, is among the first sectors affected by COVID-19.

Thailand saw a sharp decline of 58.2 percent in domestic trips in the first five months of 2020, resulting in revenue losses of 57.9 percent.

Data of the Tourism Authority of Thailand showed that foreign tourist arrivals contracted by 60 percent in January-May to 6.69 million people. Spending from foreign tourists plunged 59.6 percent to 332 billion THB.

Thailand welcomed nearly 40 million foreign holidaymakers last year./.

Chinese group to build 1.62-bln-USD hydropower plant in Indonesia

China Gezhouba Group Corporation (CGGC) has recently inked an 11.52 billion yuan (1.62 billion USD) deal with Indonesia Dafeng Heshun Energy Industri to construct Data Dian hydropower project in North Kalimantan province.

The project is part of the Belt and Road Initiative (BRI) and proactive connection with Indonesia’ Global Ocean Support Point strategy. The installed capacity of the power plant is 1,200 megawatt (MW) and the average annual power generation is 7,770 GWh.

CGGC Chairman Chen Xiaohua said the project should allow Indonesia to better tap into its abundant hydropower assets in the Kalimantan region and provide power supply for the construction of industrial parks with advanced metal smelting as the leading industry in such areas as Tanjung Selor.

Indonesia is aiming to transform its North Kalimantan province into the country’ energy and mining hub, while China currently considers Indonesia as a key partner in promoting the BRI, he said.

CGGC said it is looking forward to participating in additional major projects in Indonesia, including the construction of key facilities such as thermal power plants, highways, industrial parks, and ports.

In July 2019, the two countries agreed to prepare special funds in the BRI project as a result of bilateral meetings between Indonesian President Joko Widodo and Chinese President Xi Jinping on the sidelines of the G-20 Summit in Osaka, Japan.

In the meeting, Widodo took the initiative to submit a special funding request after offering Chinese projects worth of 91 billion USD.

The increase in bilateral relations helped strengthen China’ partnership with the Association of Southeast Asian Nations. Indonesia and China have signed 23 memoranda of understandings on investment and trade cooperation.

The cooperation contract includes the development of four economic corridors, rapid train research and technology cooperation, and the development of research of education.

Thailand aims to lure investment in agriculture

Thai Deputy Prime Minister Somkid Jatusripitak has urged the Board of Investment (BoI) to make tax incentives and investment packages more attractive to foreign agri-businesses to turn Thailand into an investment hub for CLMV (Cambodia, Laos, Myanmar and Vietnam) countries.

Somkid said the Thai government wants to draw more investors as the COVID-19 pandemic may cause them to consider changing their production bases, he said.

Thailand also aims to stand out among Cambodia, Laos, Myanmar and Vietnam as an investment destination, he added.

New investment packages should be designed to promote the agriculture sector as this will help local farmers deal with economic hardships under a state plan to boost the local economy following the COVID-19 period.

According to BoI secretary-general Duangjai Asawachintachit, officials are preparing to propose a plan to revamp investment options to the BoI board for approval.

The proposal will be tabled when the BoI board, chaired by Prime Minister Prayut Chan-o-cha, meets on June 17, Duangjai said.

Thailand aims to attract more foreign investment during COVID-19

To cope with the adverse impact of COVID-19 on foreign investment, Thai Deputy Prime Minister Dr. Somkid Jatusripitak, has assigned the Board of Investment (BOI) to fine-tune its work by highlighting the strengths of the country to attract more foreign investors.

The board was urged to focus on agricultural business to help raise income distribution in the local economy.

Deputy Prime Minister Somkid said that the BOI will find ways to create strong points in the country’s investment sector during the pandemic, which is expected to have an impact on the global economy for one to two years.

They will focus on the food industry, agriculture, processed food, medical services, tourism, logistics and digital technology, in an effort to make Thailand the investment center of the CLMTV (Cambodia, Laos, Myanmar, Thailand and Vietnam) region.

Investment in the agricultural sector will create jobs and incomes for both small and new farmers. The BOI will use its mechanisms and develop investment packages to support connectivity between the smart farmers’ group, local farmers and universities to help raise income distribution in the local economy.

To raise more funds from foreign investors in five years from now, the board has to help produce more unicorn businesses in Thailand. A unicorn is a startup company valued at more than 1 billion USD. This will enable the country to advance from being just part of a supply chain for foreign entrepreneurs.

MoIT requests local firms to control food safety for exports to China

The Ministry of Industry and Trade (MoIT) has recommended local enterprises to strictly implement regulations on food safety for farming and seafood products exported to China to avoid them getting stuck at border gates.

The recommendation was issued after China has again strengthened inspections for agricultural and seafood products at the border gates due to a new COVID-19 outbreak relating to the Xinfadi agricultural wholesale market in Beijing.

Chinese authorities would also inspect further food safety, quarantine and traceability for imported goods to this nation, especially fresh, frozen and processed agricultural and aquatic products at ports and border gates to prevent the COVID-19 pandemic.

“Those activities could affect customs clearance for goods at the border gates between Viet Nam and China,” the MoIT said.

Therefore, local firms and households exporting those products to China should cooperate with their Chinese partners to strictly comply with China's regulations to reduce risks and clearance time of goods at border gates, reported the Cong thuong (Industry and Trade) newspaper.

At present, many localities in China carry out the inspection of food safety and origin for those products at agricultural and food markets, according to MoIT. Of which, local households importing those products must have certificates of quarantine granted by China customs. 

PM approves investment policy of Tran De IP in Soc Trang

The Prime Minister has approved an investment policy for a project building and exploiting infrastructure of the Tran De Industrial Park (IP) in Soc Trang Province.

According to the approval, the 160-ha project has total investment capital of VND1.23 trillion (about US$53 million), including the State investment capital of VND246 billion and loans worth about VND984 billion.

The implementation of this project does not exceed 49 years from the date of issuing the decision on investment policy that was on June 12, 2020. The project would enjoy existing investment incentives.

The project’s investor is the Ha Thanh Concrete Joint Stock Company.

The investor is requested to implement this project within three years from the date it receives land, reported chinhphu.vn.

Tran De IP is one of five industrial parks under the provincial development planning by 2020 with a total area of ​​1,106 hectares, including An Nghiep, Dai Ngai, Song Hau and My Thanh IPs.

Of which, An Nghiep IP invested by the State has been put into operation since 2006. The province has been calling on investment for construction of other IPs.

Soc Trang has also approved establishment of nine industrial clusters with a total area of ​​over 410 hectares, including Nga Nam, Vinh Chau, Thanh Phu, Ap Nhi, Xay Da B and An Thanh.

In March, the province started the construction of Xay Da B industrial cluster on a total area of 54ha for textile, dying and garment with an investment of about VND1.7 trillion.

Vinh City to be economic centre of the north central region by 2023

The Prime Minister has just approved the project to develop Vinh City, Nghe An Province, into an economic and cultural centre of the north central region by 2023 in the spirit of Resolution 26-NQ/TW of the Politburo.

According to Decision 827/QD-TTg, Vinh City will be built to become a civilised and modern city, which is the centre of the north central region in the fields of finance, commerce, tourism, science and technology, information technology, hi-tech industry, healthcare, culture, sports, education and training.

The city targets to gain a growth rate of added value (according to 2010 comparative prices) of around 10-11 per cent per year in the period of 2020-23.

The total value added (at current prices) accounts for about 25-30 per cent of the province's GDP.

The average added-value per capita is about VND141.7 million (US$6,081).

Regarding social development, the city strives to reduce the rate of poor households in the area to below 0.25 per cent by 2023 and sustainable poverty reduction for near-poor households.

The rate of trained people reaches over 70 per cent, of which vocational training reaches 46 per cent.

Vietnamese export goods face 12 trade remedy cases in H1

The Ministry of Industry and Trade’s Trade Remedies Authority of Viet Nam announced that 12 trade remedy cases were initiated by foreign countries and territories for Vietnamese goods in the first six months of this year.

At the same time, there are three trade remedy cases at high risk of initiating an investigation in the near future, the department said.

Up to now, there have been 174 trade remedy cases initiated by foreign countries and territories against Vietnamese exports, including 98 anti-dumping cases, 19 anti-subsidy cases, 23 cases of anti-dumping evasion and 34 safeguard cases.

The foreign countries and territories with trade remedy investigations on Viet Nam's exports include the US with a total of 34 cases, India with 26 cases, Turkey with 21 cases, Canada with 15 and Australia with 11 cases, reported the Dau tu (Investment) newspaper.

Viet Nam has many products exported globally with increasing value each year. That has meant trade remedies for Vietnamese export goods have increased.

The ministry has also announced a list of 12 products which are at risk of being investigated for trade defence measures or origin fraud and illegal conveyance in the US and EU, including tyres for buses and lorries, hardwood plywood, mattresses, wooden cabinets and vanities, and quartz surface products. 

Lender ACB to issue bonus shares at the rate of 30 per cent

Asia Commercial Joint Stock Bank (ACB) plans to pay a 30 per cent share dividend for 2020 to prepare for life after the COVID-19 pandemic.

Every shareholder will receive three new shares for every 10 shares they hold, meaning ACB will have to issue nearly 499 million new shares.

The bank currently lists more than 1.66 billion shares on the Ha Noi Stock Exchange (HNX) with code ACB.

ACB shares gained 2.1 per cent to trade at VND23,800 (US$1.03) apiece on Tuesday.

The issuance is expected to happen in September. The previous dividend plan was 20 per cent in shares and 10 per cent in cash.

As the pandemic is nowhere near containment, the share issuance plan will help ACB increase capital for lending, government bond purchasing and investing in strategic targets for 2019-24.

ACB also hopes to move its shares from the HNX to the Ho Chi Minh Stock Exchange (HoSE) in November or December this year.

If approved, ACB shares may be added to the large-cap tracker VN30-Index and other special trackers like VNDiamond, VNFIN Select and VNFIN Lead.

The switch will improve the status of ACB shares to investors, raising the bank’s valuation, CEO Do Minh Toan said at the bank’s annual shareholder meeting on Tuesday.

CEO Toan said ACB in the first five months earned a total of VND3.5 trillion in pre-tax profit, equal to 45.8 per cent of the full-year target.

The bank might fulfil half of its profit target in June, he said.

The bank had suffered a loss in service fees while total lending grew by only 4 per cent in the five months, Toan said.

The decline of service fees was covered by the growth of bancassurance and card issuance, he added.

Lending income had declined by 30 percentage points year-on-year and credit growth was slow because ACB had activated a risk-sharing mechanism with customers to maintain its market share, he said.

Total lending is estimated at VND15 trillion and loan repayments depend on the recovery of the economy, according to the CEO.

ACB in 2020 targets to raise total assets, customer savings and credit by 11.75-12 per cent year-on-year. The bad-debt ratio is expected at a maximum 2 per cent and pre-tax profit is projected at nearly VND7.64 trillion.

The bank also plans to sell bonds on the international market and offload its ownership in the member firm ACB Securities Co (ACBS).

ACB in 2019 posted a 16 per cent annual increase in total assets, reaching VND384 trillion at year-end.

Customer savings rose 14 per cent on-year to VND308 trillion in 2019 and outstanding loans were worth VND269 trillion, up 17 per cent year-on-year.

Pre-tax profit gained 18 per cent year-on-year to VND7.5 trillion last year. 

Corporate bond issuance drops a tenth in May

Total value of corporate bond issuance fell 10 per cent month-on-month to VND27.06 trillion (US$1.17 billion) in May, according to the Ha Noi Stock Exchange.

Eighty per cent of the bonds were medium-term with maturities of three to five years.

Banks and property developers remained the biggest issuers but their issuance values declined.

Banks’ corporate bond issuance was down a fifth monthly in May to VND11.5 trillion and real estate firms’ was halved to VND4.75 trillion.

On the other hand, corporate bond issuances in the service and construction sectors rose to VND5.63 trillion and VND2.6 trillion, respectively.

The biggest bond issuers in May included the Vietnam Prosperity Joint Stock Commercial Bank (VPBank) with VND6.3 trillion, the Joint Stock Commercial Bank for Investment and Development of Vietnam (BIDV) with VND3.09 trillion, and property firm Phu Long with VND1.4 trillion.

After the first five months, 100 companies made nearly 580 bond issuances, raising a total of VND91.6 trillion worth of corporate bonds. 

Vietjet to establish e-wallet business

The board of local low-cost carrier Vietjet has approved the establishment of an e-wallet subsidiary with a charter capital of VND50 billion, in which Vietjet will hold a 51% stake.

The board also tasked Vietjet’s vice general director and chief financial officer Ho Ngoc Yen Phuong with implementing essential procedures for the capital contribution in order to set up the new business.

In 2019, an estimated US$2.5 billion of Vietjet's revenue was earned through non-cash payment. Moreover, 99.99% of transactions conducted in the Vietjet ecosystem were cashless, stated Nguyen Thi Thuy Binh, vice general director of Vietjet, at a recent seminar on cashless payment held by Tuoi Tre newspaper.

When the coronavirus pandemic was at its peak in the country, the carrier discovered new business opportunities based on the shopping habits of customers, who can use Vietjet’s platforms to not only book flight tickets but to also hire vehicles, book hotel rooms and other services needed while taking trips.

Envisioning a cashless society, the carrier decided to set up the e-wallet business and will team up with other partners to offer more methods of payment to consumers, Binh added.

Honda Vietnam recalls 19,219 cars over faulty fuel pumps

Honda Vietnam will recall 19,219 cars beginning today, June 16, to check and fix fuel pump defects that can lead to engines stalling.

The recall will be applicable to some 8,000 CR-V cars, roughly 4,000 City cars and Jazz, HR-V, Accord and Civic cars assembled or manufactured between 2018 and 2019.

A faulty fuel pump relay can cut off power to the fuel pump, which will cause the engine to stall or not start.

Honda Vietnam will implement free checks and replace defective fuel pumps at Honda authorized dealerships nationwide.

Although there have not been any accidents related to faulty fuel pumps in Vietnam, the company announced the recall to ensure the safety of its customers.

Honda car owners will receive details of the recall campaign via a letter, an email or a phone call.

Japanese fund invests US$8 million in Vietnamese cinema company

Beta Media, operating the low-cost movie theater chain Beta Cinemas, reached an agreement to receive US$8 million from Daiwa PI Partners, an investment fund from Japan, achieving an enterprise valuation of VND1,000 billion.

Beta Media has 12 cineplexes and some 60 cinema halls nationwide.

Bui Quang Minh, the founder of the company, said the call for investment was made in the first half of 2019 and an agreement was reached by the end of the same year, but the coronavirus pandemic delayed the process.

Due to the Covid-19 infection, Beta Cinemas had to shut down operations for weeks, causing further difficulties. Currently, all the cinemas of Beta Media have resumed operations and the investment deal has been completed.

The new investment will enable Beta Media to have more resources and grow stronger in the near future. According to Minh, the company is expected to own 50 cinemas in the next two to three years.

Beta Media launched the Beta Cinemas cinema model at the end of 2014, targeting students and young, cost-conscious consumers, with an affordable pricing scheme, averaging at some VND50,000 per movie ticket.

In 2015, Beta Media received investment capital from the Vietnam Investment Group and in 2017, it received US$2.5 million from the Blue HK Financial Group (Hong Kong) with a valuation of VND600 billion.

Daiwa PI Partners is an entity of the Daiwa Securities Group, engaged in the business areas of debt investments, private equities and the establishment and management of investment funds.

Masan seeks to buy out Vinacafe Bien Hoa

Masan Consumer is seeking to buy the remaining 1.51% stake in Vinacafe Bien Hoa to raise its ownership in the coffee processor to 100%, reported Thanh Nien Online newspaper.

Masan Beverage, a wholly-owned subsidiary of fast-moving consumer goods firm Masan Consumer, announced an offer to buy 401,000 shares in Vinacafe Bien Hoa for some VND90 billion between June 17 and July 16. The latest transaction was made in February 2018 when it bought around eight million shares for VND1.6 trillion to increase its holding to 98.49%.

The Vinacafe Bien Hoa stock, coded VCF, is trading at VND225,000 per share, the highest on the Hochiminh Stock Exchange. As Masan holds a majority stake in the enterprise, VCF reports a low trading volume at less than 500,000 shares per session.

As the leading instant coffee manufacturer in Vietnam, the coffee maker used to offer the most attractive dividend in 2017 at up to 660%, allowing shareholders to receive VND66,000 for every share held. In the first quarter of 2020, it reported VND483.3 billion in revenue and VND103 billion in after-tax profit, equivalent to last year’s figures.

Travel revenue in May drops by 90% year-on-year

Despite the increasing local demand, Vietnam’s travel revenue in May fell by 90% compared with the same period last year, Minister of Culture, Sports and Tourism Nguyen Ngoc Thien told a meeting on June 13.

Since the Covid-19 infection prevention and control measures were relaxed, the country’s tourism sector has gradually recovered but it has mainly relied on domestic demand as the country is still closed to foreign travelers.

Businesses and local authorities have launched a series of tourism stimulus programs but the demand for travel remains low. Many travel companies in HCMC are still closed or operating perfunctorily. While beach resorts and hotels have seen their weekend room occupancy rates improve significantly, the average rates remain low.

“To maintain the company’s operations, our staff, from the general director to the security guards, are receiving the same salary based on the base salary,” the general director of a travel company in District 1, HCMC, told The Saigon Times.

Minister Nguyen Ngoc Thien noted that getting the tourism industry back on track requires four steps including boosting local tourism demand, welcoming a limited number of foreign tourists to certain resorts that have effective Covid-19 infection prevention and control measures, receiving tourists from countries that have effectively controlled the pandemic and eventually reopening the tourism market completely. Vietnam is still in the first stage.

International tourist arrivals to Vietnam from January to May 2020 dropped by 50%, while the number of domestic tourists also fell by 58% compared with the same period last year, leading to a 50% year-on-year decline in tourism revenue.

Singapore, China boost implementation of Smart City Initiative

Singapore and China’s Shenzhen city on June 17 inked eight memoranda of understanding (MOU) in support of their Smart City Initiative (SCI) that was agreed upon last year.

With the aim of connecting business ecosystems and strengthening links between Singapore and China's tech capital, SCI will allow both sides’ businesses and people to tap into the opportunities available in Guangdong-Hong Kong-Macau Greater Bay Area and Southeast Asia.

As part of the initiative, a new Asian small-and medium-sized enterprise (SME) hub will be put into operation by July 2020, which is expected to connect about 4 million Chinese businesses with 50 Singaporean SMEs selling protective equipment and office supplies.

Firms with greenback loans see more positive outlook in Q2

Firms with US dollar-denominated debts estimate to regain significantly in the second quarter of this year as the US dollar has devalued against the Vietnamese dong in the period after reporting a surge in the first quarter.

In the first quarter of 2020, the USD/VND exchange rate increased by nearly 2 percent to 23,644 VND per US dollar in the context that the global greenback price hit a three-year high with the US Dollar Index on March 20 reaching 102.8, up 6.7 percent compared to the end of 2019.

The domestic foreign exchange rate was also affected adversely when currencies of many major trading partners of Vietnam devalued and the domestic market sentiment was hit by the COVID-19 pandemic.

According to experts, the COVID-19 pandemic caused the global financial market to plummet. The need to withdraw capital from risky assets to pour into secure, safe assets was the main reason for the rise of the dollar.

The appreciation of the dollar against the dong in Q1 2020 significantly affected firms with large dollar-denominated loans, causing them to report losses related to the foreign currency exchange rate.

However, the situation has changed since the second quarter. The USD/VNĐ exchange rate has reversed and is continuing on a downward trend. The dollar is currently traded at around 23,265 VND, down 1.6 percent compared to the beginning of Q2 2020 because the supply of foreign currencies in the domestic market has been good, especially when the country’s trade surplus is still high.

Therefore, firms with large dollar-denominated loans, such as Binh Son Refinery and Petrochemical Joint Stock Company, Vietnam Aviation Corporation JSC and PetroVietnam Power Corporation, expect to benefit from the move in the second quarter.

On June 17, the State Bank of Vietnam set the daily reference exchange rate at 23,240 VND per dollar, down 9 VND from the previous day.

With the current trading band of /-3 percent, the ceiling rate applied to commercial banks during the day is 23,937 VND per dollar and the floor rate 22,542 VND.
During the day, Vietcombank listed the buying rate at 23,090 VND per dollar and the selling rate at 23,300 VND, both down 10 VND from the previous day.

At BIDV, both rates were cut by 5 VND to 23,120 VND for buying, and 23,300 VND for selling.

Techcombank cut 1 VND for both rates, listing the buying rate at 23,104 VND for buying, and 23,304 VND for selling.

US helps Indonesia design gas infrastructure

The US Trade and Development Agency announced on June 17 that it had awarded a grant to Indonesia’s PT Nusatama Properta Panbil to promote continued economic growth and energy security in Indonesia.

The agency’s targeted investment will fund a feasibility study to evaluate the development of a liquefied natural gas (LNG) receiving terminal, as well as storage and transshipment facilities on Pulau Asam. Its engagement will also create export opportunities for US suppliers of LNG technology.

Thomas R. Hardy, USTDA’s Acting Director, said that USTDA has helped partners like Indonesia plan priority gas infrastructure for decades, and this project will provide critical resources to Western Indonesia and explore expanded options for inter-island gas transportation.

The proposed terminal and related facilities will receive and process LNG for onward inter-island transportation, pipeline injection, or as a marine bunkering fuel, depending upon the final recommendations of the feasibility study.

The study is a project of USTDA's US Gas Infrastructure Exports Initiative and the Administration's Asia Enhancing Development and Growth through Energy (Asia EDGE), which strengthen energy security and expand energy access in partner countries.

Cambodia predicted to export 800,000 tonnes of rice in 2020

Cambodia’s rice exports are expected to reach 800,000 tonnes in 2020, an estimated rise of 29 percent compared to 2019, according to China’s Xinhua News Agency.

It quoted Ngin Chhay, an official from the Cambodian Ministry of Agriculture, Forestry and Fisheries, as saying that his country had seen a remarkable increase in rice exports in the first five months of this year due to high demand from the international market as a result of the COVID-19 pandemic.

The Southeast Asian nation exported a total of 356,097 tonnes of rice to 54 countries and territories around the world during the January-May period, up 42 percent over the same period last year.

China and European remained the biggest importers of Cambodian rice in the last five months, with the volumes of 136,825 tonnes and 122,010 tonnes, up 25 percent and 51 percent, respectively.

According to the ministry, the country harvested 10 million tonnes of paddy rice last year. With this amount, Cambodia saw paddy rice surplus of about 5.6 million tonnes, equivalent to 3.5 million tonnes of rice.

Vietnam, India step up trade ties

Vietnam is making efforts to help Vietnamese and Indian export-import firms handle difficulties, especially during and after the COVID-19 pandemic, heard an online conference on June 17.

Speaking at the conference on Vietnam-India investment and trade in the new normal, Do Quoc Hung, deputy head of the Asia-Pacific Market Department under the Vietnamese Ministry of Industry and Trade (MoIT), said Vietnam commits to easing trade barriers to prevent any adverse impacts on trade and business activities in all sectors, he said.

He called on India not to impose trade defence measures on Vietnamese products, and consider removing the existing trade restrictions.

Vietnam has joined 16 regional and international free trade agreements (FTAs), including the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the EU-Vietnam Free Trade Agreement (EVFTA), Hung said.

These deals have brought about opportunities for Vietnamese enterprises to expand the market, while helping Indian firms to enhance their cooperation with Vietnamese partners, and access the Vietnamese market as well as other regions through Vietnam, he stressed.

As of May 2020, India had run 275 projects worth nearly 900 million USD, ranking 26th out of 136 countries and territories investing in Vietnam.

However, Le Thi Hai Van, deputy head of the Foreign Investment Department under the Ministry of Planning and Investment (MPI), said the figures have yet to match the potential of the fruitful relationship between the two countries.

She suggested the two countries increase trade promotion activities and enhance connectivity between their enterprises in order to boost bilateral trade ties.

At the conference, some Indian companies shared experience in business development and high-quality personnel training, and spoke of investment opportunities and prospects in India.

They shared the view that Vietnam is an emerging market that plays a significant role in the region.

The event was jointly held by the Commercial Affairs Office of the Vietnamese Embassy in India, the MPI, the Investment and Trade Promotion Centre of HCM City, and the Federation of Indian Chambers of Commerce and Industry.

East Asia Business Council discusses ways to boost economic recovery

The East Asia Business Council (EABC) has recently convened its 47th meeting in an online format, attracting representatives from 13 East Asian nations, including 10 ASEAN member states and their three partners of China, Japan and the Republic of Korea.

Chairman of the Vietnam Chamber of Commerce and Industry Vu Tien Loc, who is also EABC Chairman, said that regional countries have made efforts to minimize impact of the COVID-19 pandemic on people’s health and enterprises’ operations.

To overcome current challenges, participants discussed measures related to the Regional Comprehensive Economic Partnership (RCEP) as well as ways to boost the digital economy and support micro-, small- and medium-sized enterprises (MSMEs).

The council advised governments to speed up the signing of the RCEP, and agreed to intensify cooperation of the private sector in sharing information and establishing platforms to promote digitalization.

It committed to continuing initiatives to facilitate the development of MSMEs which are the driving force for post-pandemic economic development and recovery.

The 48th meeting of the council is scheduled to take place in August.