After two years of pilot implementation, the Hanoi Department of Customs officially introduced an Aviation National Single Window and automated system for customs management and supervision on September 29.
 
According to the department, the window and system will minimise the contact needed with businesses in completing customs procedures, adding to administrative reform efforts and making procedures more transparent for customs authorities.

Using the two systems will change the management method from manual to electronic data collection.

For the management of vehicles and passengers upon exit and entry, the application of risk management will help customs authorities gradually reduce unnecessary inspections and only focus on targeted flights and persons, reducing the instance of smuggling, trade fraud, and illegal transportation of goods via international airports.

The official introduction of the system will bring efficiency and major benefits to customs authorities, airlines, businesses, and individuals. It has so far met targets set. All airlines have sent information to the Aviation National Single Window. The rate of automated handling of goods and information collection has hit over 99.5 percent.

Silkworms to create wealth in remote area

Farmers in remote Đăng Hà commune in Bù Đăng district, southern Binh Phuoc province, toiled away at inefficient cashew nut farming before switching to mulberry trees to breed silkworms. And the little worms have helped local people wiggle away from poverty.
 
They can earn handsome and sustainable profits from breeding silkworms, as investors have undertaken to buy them all.

Boxes of silkworm breeds can be bought for just 22 USD each, with 15 days needed to nurture them. Farmers could harvest 45 kg and earn a profit of some 100 USD on each batch.

Mai Kỳ Khánh from Hamlet 6 in Dang Ha commune has been planting mulberry trees and breeding silkworms for two years. He now earns over 500 USD per batch - quite a sum compared to his neighbors.

Local farmers had struggled with growing cashew nuts until they switched to new economic models, including planting mulberry trees and breeding silkworms. After seeing how effective the switch has been, local authorities are planning to encourage others to follow suit./.

Banks target consumer loans for higher credit growth

Commercial banks are trying to boost individual consumer loans, especially to home and car buyers, since credit growth had slowed due to low capital demand from businesses.

SHB has recently launched attractive loan packages for home and car buyers, with interest rates of 6.5 percent and 6.8 percent per year, respectively, down from 7.5 percent.

In a similar move, BIDV said it had set aside 30 trillion VND (1.29 billion USD) to lend to individual clients with interest rates of 5.5 percent per year for loans with terms less than six months, and 6 percent for 6-12 month loans. These rates are down 0.5 percent against last month.

At Maritime Bank, clients can borrow money to buy cars at 6.99 percent per year while the rate at NCB is 7.99 percent.

Other banks offering car purchasing loans at interest rates below 10 percent include Techcombank at 8.19 percent, Vietcombank at 8.4 percent and Military Bank at 8.5 percent.

Foreign banks have also joined the push, offering car loans at interest rates below 10 percent.

Woori Bank is lending to fund car purchases at a rate of 7 percent per year for the first 12 months.

HongLeong Bank quotes a rate of 7.55 percent per year for the first 12 months and 8.55 percent for 24 months, Standard Chartered 7.25 percent and 8.49 percent, and Shinhan Bank 7.69 percent and 8.6 percent, respectively.

Interest rates for home loans offered by foreign banks are also attractive. Standard Chartered provides loans at a preferential interest rate of 6.49 percent, HongLeong Bank 6.75 percent, Shinhan Bank 6.9 percent and Woori Bank 7 percent.

According to industry insiders, interest rates for car and home loans were nearly equal to 6-12 month term deposit interest rates.

Home and car loans account for the largest proportion of banks’ consumer loans. Home loans are estimated to account for 50 percent, and car loans 10 percent.

According to experts, banks had to cut interest rates for consumer loans to boost lending as deposits had continued to rise while lending to firms had slowed.

According to the State Bank of Vietnam (SBV), as of mid-August, deposits had increased by 6.3 percent, while loans had risen by only 4.13 percent.

Money had continued to flow into banks, despite deposit interest rates falling. Meanwhile, individuals and firms with large amounts of cash were leaving their money in banks.

Banking expert Nguyen Tri Hieu told Vietnam News that banks were focusing more on consumer lending as these loans had interest rates far higher than other kinds of loans because of the higher risks.

Finance reports from some profitable banks showed that their profits were due to the increase in consumer loans.

Hieu said at the moment, with the economy struggling to recover from the COVID-19 pandemic, consumer loans would help stimulate general demand, thus supporting economic growth.

A recent report from BIDV Securities Company (BSC) forecast that credit growth in the entire banking system this year would be only 9 percent, compared with the 13 percent set in 2019.

Analysts from Saigon Securities Incorporation (SSI) estimated an even lower rate. SSI’s recent report on the outlook for the banking industry in the second half of 2020 forecast credit growth in 2020 would be around 7.5-8.5 percent.

According to the analysts, the credit demand may continue to weaken as the country still suffered impacts of the pandemic while banks, especially large-sized ones, may not lower their credit granting standards.

Due to the low credit growth, besides consumer loans, banks were increasing their purchases of Government bonds, despite the lower interest rates.

The Hanoi Stock Exchange (HNX) reported that it had mobilised 22.8 trillion VND through Government bond issuances in August. The figure had reached 1,230 trillion VND as of August 31.

Banks were also buying more corporate bonds. Bankers were the biggest buyers of bonds, especially real estate bonds. In the first half of this year alone, banks bought VNĐ28 trillion worth of bonds issued by real estate firms, which accounted for 40 percent of the total bonds issued./.

Kaspersky willing to share cyber security solutions with Vietnam

Stephan Neumeier, Managing Director of Russia’s Kaspersky Lab Asia Pacific, said the company is willing to share its experience and security solutions to help protect Vietnam from cyber attacks.

Kaspersky and its researchers have more than 20 years of experience and a range of security solutions it stands ready to share with Vietnam, he affirmed.

Similar to other countries around the world, COVID-19 has increased the number of Internet users in Vietnam, and its increasing influence and presence in daily life opens up the opportunity for cybercriminals to operate, he said.

Kaspersky has cooperated with the Vietnamese Government for many years, with the aim of protecting the country from cyber crime and helping it build national network security capacity.

The Russian company signed a memorandum of understanding with the Authority of Information Security (AIS) in 2018 and another with the National Cyber Security Centre (NCSC) in 2019, he said.

Vietnam is implementing a national campaign to review and remove malware nationwide, and he believes this is a great example of how public and private organisations can work together to create a more secure cyberspace.

The Vietnamese Government has worked with a number of private partners, including Kaspersky, he went on, and the company believes that through cooperation the two sides will achieve the goals of the campaign to reduce malware infections and the number of IP addresses in ten popular botnet networks in Vietnam.

Regarding the potential of Vietnam and Kaspersky’s prospects for cooperation with the Southeast Asian nation, Neumeier said Vietnam is a key market in the Asia-Pacific region.

The popularity of the Internet in Vietnam is growing and will continue to do so over the next few years, he said, while the Vietnamese Government is also actively promoting digitalisation and the fourth Industrial Revolution in parallel with efforts to raise awareness of cyber security in the country.

Kaspersky considers Vietnam a regional cyber security centre and is honoured to participate in its campaigns to create a secure cyber space at an organised and national level, he affirmed./.

EU partners with ASEAN nations on counterfeit drug prevention

EU Ambassador to ASEAN Igor Driesmans said the EU has launched a new social media campaign entitled “Your Health Is Priceless” which aims to raise awareness of the harms that counterfeit pharmaceutical and healthcare products can cause falsified medicines in Southeast Asia.

The campaign, part of the EU-funded project Intellectual Property Key South-East Asia (IP Key SEA), constitutes a call for the public to share their experiences with counterfeit medicines on social media.

The IP Key SEA is a four-year 7 million EUR (8 million USD) programme implemented by the European Union Intellectual Property Office (EUIPO).

The programme’s main objective is to support intellectual properties (IP) right protection and enforcement across Southeast Asia, with a view to creating the appropriate legal and economic environment conducive to trade and investment in the region.

According to a study recently released by EUIPO and the Organisation for Economic Cooperation and Development (OECD), 90 percent of counterfeit medicines can be harmful to a patient’s health, because they do not comply with intellectual property law.

They can either be medical drugs like antibiotics, painkillers, and medicines for diabetes, central nervous system, heart disease, cancer, malaria, and HIV/AIDS, or lifestyle drugs and medicines for an esthetical purpose, ranging from beauty injections to skincare.

However, some of these counterfeit products are classified as food supplements or cosmetics in some countries.

According to Tiago Guerreiro, IP Key SEA Project Leader, fake medicines may contain both placebo and dangerous substances. The objective of counterfeiters is to make as high a profit as possible from the sale of counterfeit medicines, using cheap substances and materials that could be readily available, but are not intended for human consumption./.

Mobile banking helps the poor access financial services

Financial education has helped poor households and policy beneficiaries access and use financial products and services, thus promoting comprehensive finance, attendees heard at a conference held in Hanoi on September 29.

In early 2019, the Vietnam Bank for Social Policies (VBSP) and Oxfam signed a cooperation agreement to study access to financial education of the poor and disadvantaged via mobile phones. The financial education for poor households and disadvantaged groups via mobile phones is a solution to inform customers about credit programmes, loan procedures and detailed products at banks, as well as basic knowledge on family financial management.

This study aimed to help customers improve financial understanding, capital efficiency, increase savings and manage family spending, becoming familiar with digital technology, especially customers in rural and remote areas. It also helps create equality and narrow the gap between urban and rural areas, between the poor and disadvantaged groups in society.

Financial education has indirectly supported the implementation of national target programmes on new rural construction, social security and sustainable poverty reduction.

VBSP cooperated with Oxfam to conduct a survey on the financial education needs of clients in three provinces of Hai Duong, Thanh Hoa and Quang Ngai. Survey results showed that over 80 percent of interviewed customers were aware of financial education’s benefits for their families.

Based on survey results, the bank designed and tested financial education applications on mobile phones. The app is available on the iOS and CHPlay stores with a simple, easy to understand and easy to use interface, suitable for poor households and policy beneficiaries.

According to Nguyen Thanh Phuong Chi, Deputy Director of the VBSP’s International Cooperation and Communication Department, this application helps customers keep up with the implementation of e-Government and national public services. In addition, it is one of the transparent tools and solutions to protect customers’ interests.

Nguyen Thi Kieu Chinh, Vice Chairman of the Women's Union of Thuong Tin istrict of Hanoi, said this application is easy to install with useful content. The app provides customers with knowledge of personal and household financial management, support business and production, helping women know how to calculate loans and bank savings.

Nguyen Thi Thu, a leader of the savings group in Duyen Thai commune, Thuong Tin district, said: “The application has helped me and many other village members understand how to calculate interest rates, repayment schedules, savings deposits, thereby creating conditions for us to create own capital to get rich.”

Phan Cu Nhan, Director of the VBSP’s International Cooperation and Communication Department, said through more than 20 policy credit programmes, over 38 million poor households and policy beneficiaries have access to capital for economic development.

Policy credit capital has been invested in all communes, wards and towns nationwide; in which, priority is given to lending to ethnic minority groups or those in extremely difficult, remote and border areas. As of August 31, the total outstanding loans for social policy credit programmes reached 221.5 trillion VND (9.56 billion USD), with over 6.5 million customers.

Nhan added one of the bank’s development goals is to diversify products and services, promote the application of modern technology in professional operations to promote a comprehensive financial strategy in Vietnam.

Over the years, VBSP has taken necessary steps to enhance comprehensive financial development in the bank's customer community in particular and in Vietnam in general, such as strengthen financial education for partners and customers. The bank’s products are always oriented towards customers’ convenience, enhancing customer rights assurance and applying digital finance in operations./.

Singaporean economists upbeat about Vietnam’s economy

Vietnam’s economy recovered in the third quarter, but growth has come in slightly weaker than what Singaporean economists have expected.

The country’s gross domestic product (GDP) in the third quarter rebounded 2.6 percent year on year, compared with 0.4 percent seen in the previous quarter, falling short of private sector economists’ expectations of 2.7 percent growth.

The recovery pace remains weak after the interruption from a temporary resurgence of COVID-19 cases in Da Nang city in late July, said the United Overseas Bank’s head of research Suan Teck Kin, adding the authorities have regained control of the situation and businesses activities are back on track; however, they are still below “normal”.

Maybank Kim Eng economists Linda Liu and Chua Hak Bin noted that Vietnam has escaped a recession amid the pandemic this year, but recovery has been dampened by the emergence of a "second wave".

Suan said while the worst of the impact from COVID-19 appears to be over, as is the case for other Asian countries, it is still "a long way" before Vietnam's economy could return to full capacity.

So far, data has shown an "anemic recovery" for the industrial and services sector, which account for more than 70 percent of Vietnam's economy, he said. At the same time, the services sector, which is heavily reliant on inbound tourism, has been hit by border closures around the world and could continue being in "a dismal state" for some time, he added.

He is expecting recovery to extend further in the fourth quarter, but with a restrained pace due to the ongoing pandemic, predicting a 4 percent growth in Q4 and for full-year expansion to come in at 2.8 percent.

Maybank Kim Eng economists lowered their forecast for the fourth quarter from 6 percent to 4.5 percent, and for full-year growth to come in at 2.9 percent instead of 3.6 percent, as the recovery momentum appears to be losing steam.

They said that the industry and construction sectors will continue to lead the recovery, while services will trail due to softer demand and the lack of a meaningful tourism recovery.

However, they said better recovery will be in the retail sales, which grew from 3.6 percent in August to 4.9 percent in September. This means non-tourism-related services are starting to catch up./.

Vietnam willing to welcome investment from Japanese IT firms: Official

Vietnam is willing to welcome investment from Japanese IT enterprises, Deputy Minister of Information and Communications Pham Anh Tuan told an online conference on September 30.

Held to promote Japanese investment in the central city of Da Nang, the conference attracted the participation of about 200 investors and IT businesses from Japan.

In his remarks, Tuan said the Vietnamese Government has been completing its model, mechanism, and policy for the breakthrough development of concentrated IT and high-tech areas in Vietnam’s major economic hubs.

Da Nang is emerging as a “Silicon Valley” of Southeast Asia, with local authorities working to build its digital ecosystem and prioritising FDI projects in the high-tech sector, he added.

Vietnam is switching to the so-called “Make in Vietnam” movement, while boosting the formation of joint ventures and attracting foreign conglomerates, especially those producing smart equipment using the Internet of Things (IoT), artificial intelligence (AI), and big data technologies, among others.

The country has already released a national programme for digital transition by 2030, to create a digital space that covers activities in health, education, finance, agriculture, and transport, and a cooperative environment that assists foreign investors in Vietnam.

A Japanese representative at the conference said Japan is Vietnam’s second-largest foreign investor, pouring over 60 billion USD into some 4,200 projects, including more than 700 in IT and communications.

As of September, Japan led in foreign investment in Da Nang, with 214 projects and more than 816 million USD, mostly in industrial production and services. Japan possesses strengths in capital, high quality human resources, and advanced IT, so boosting its IT investment in Da Nang would bring benefits to both.

Japanese enterprises also joined a business matching event on the sidelines of the conference on the afternoon of September 30./.

HCM City’s CPI inches up 0.17 percent in September

The consumer price index (CPI) in Ho Chi Minh City in September went up by 0.17 percent in comparison to the previous month, the municipal Statistics Office reported on September 29.

According to the office, the prices of three out of 11 groups of consumer goods and services in the CPI basket witnessed month-on-month decreases, including food and catering services (0.06 percent), household appliances (0.27 percent), and culture, entertainment and tourism (0.28 percent).

Meanwhile, seven groups with higher prices were education (1.39 percent); beverage and tobacco (0.21 percent); clothing, hats and footwear (0.05 percent); housing, electricity, water, fuel and building materials (0.36 percent); transportation (0.14 percent); post and telecommunication service (0.82 percent); and other commodities (0.07 percent).

The prices of medicine and medical services remained unchanged.

In the month, the gold prices fell 0.74 percent from the previous month, while the USD/VND exchange rate slid 0.04 percent.

The city’s average CPI in nine months expanded 3.12 percent as compared to the same time last year./.

Da Nang, FPT cooperate in building digital government

Officials of the central city of Da Nang held a working session with executives of telecom group FPT on September 29 to outline plans for bilateral cooperation in the time ahead.

FPT Director General Nguyen Van Khoa proposed that the group can send experts to help Da Nang in upgrading its electronic government architecture and advise the city in building a digital government.

The group is also willing to assist the city in drafting a plan on the application of information technology for 2021-2025 with orientations to 2030.

At the same time, FPT hopes to work together with Da Nang in deploying such services as building a platform integrating all data-sharing services, perfecting shared databases, implementing digital health care and smart hospitals, setting up a smart traffic centre, and realizing online education and testing.

Standing Vice Secretary of the municipal Party Committee Nguyen Van Quang affirmed the city’s policy on facilitating investment projects by IT groups in the city.

The two sides agreed to start a pilot project on assisting with digital transformation by the administration of Ngu Hanh Son district, which houses a FPT-invested urban area./.

Binh Duong seeks to attract foreign investors

The southern province of Binh Duong has committed to further improving its investment climate to ensure it remains an ideal destination for foreign investors.

The province has greatly improved road infrastructure to enhance transport connectivity with HCM City and nearby provinces, developed concentrated industrial zones and attracted workers from provinces and cities around the country.

According to Bui Minh Tri, head of the province industrial zones (IZs) management board, as one of the fastest growing provinces in the key southern economic zone, Binh Duong is among the hottest investment destinations in the country.

Therefore, it is always looking for means to develop transport infrastructure to help ship goods to other provinces as well as abroad without suffering from congestion.

It plans to further improve connectivity by developing waterways and, in the future, a rail link to transport goods to ports in HCM City and Dong Nai province.

Mai Hung Dung, deputy chairman of the province People’s Committee, said one factor that had attracted investors to Binh Duong was its infrastructure development.

The widening of major roads such as Highway No.13 and My Phuoc - Tan Van that run between concentrated industrial zones has created a big advantage in transporting quickly efficiently to ports.

Sompob Witworrasakul, general director of Vina Kraft Paper Co., Ltd, said his company chose Binh Duong to invest in because it has modern infrastructure and offers convenience in goods transport.

Besides, it was a leading province in plans to create a smart city.

Under the smart city scheme, Binh Duong aims to improve its workforce’s skills and education, expand R&D activities and develop a start-up eco-system, attract more FDI in high-tech manufacturing, and improve transport, ICT infrastructure and living conditions.

Binh Duong New City will be the centre of the Binh Duong Smart Province and house the most important urban areas, research and educational institutions and industrial zones.

Dung said the province has prioritised investment in high-tech industries, supporting industries, IT, precision engineering, trade, and services.

A total of 3,999 companies have been set up in the southern province this year with total capital of 26.95 trillion VND (1.16 billion USD).

The figures represent year-on-year declines of 2.5 percent in number and 1 percent in total capital, caused mainly by the impacts of the COVID-19 pandemic./.

Nearly 99,000 businesses established in nine months

Nearly 99,000 new enterprises were established in the first nine months of this year, a year-on-year fall of 3.2 percent, according to the General Statistics Office (GSO).

The firms registered to invest a total capital of more than 1.4 quadrillion VND (60.56 billion USD), and hire 778,000 labourers, up 10.7 percent and down 16.3 percent as compared to the same time last year.

The average registered capital of each new business was at 14.4 billion VND, a year-on-year surge of 14.4 percent.

Meanwhile, 29,500 operating enterprises registered to increase capital by 2.1 quadrillion in total for their business. As a result, the domestic economy received a total capital of more than 3.6 quadrillion VND from newly established and existing businesses this year, expanding 19.2 percent year on year.

In three quarters, 34,600 companies resumed operation, up 25.5 percent from the same time in 2019.

Additionally, there were 38,600 businesses temporarily suspending operations, a surge of 81.8 percent compared to the previous year; while about 27,600 enterprises were waiting for dissolution procedures and nearly 12,100 completed dissolution procedures, down 2.4 percent and up 0.1 percent, respectively.

A survey on business trends of enterprises in the processing and manufacturing sector in the third quarter showed that 32.2 percent of businesses had better business performance than the previous quarter. About 32 percent of surveyed firms had difficulties in production and business, and 36 percent had stable operation.

Up to 45.6 percent of enterprises felt upbeat about their business in the quarter, 19 percent forecast difficulties, and 35.4 percent believed they would have stable business and operation./.

Opportunities await sugarcane farmers if they change their way of thinking

While many people believe that sugarcane farmers will face difficulties after Viet Nam implements the ASEAN Trade In Goods Agreement (ATIGA), there are also some who say it could offer bright prospects for Vietnamese sugarcane to maximise its economic value if there is co-ordination between the State, scientists, entrepreneurs and especially farmers.

Professor Vo Tong Xuan, a top agricultural expert, said that if it was invested and exploited thoroughly, sugarcane could bring high economic value for Vietnamese farmers and businesses.

The State has been pushing solutions to support farmers in recent years, including providing funding for scientists to research and provide new sugarcane varieties for farmers, and to guide scientific cultivation to improve sugarcane productivity.

Sugarcane had many advantages and high economic value, the Dau Tu Chung Khoan (Securities Investment) magazine quoted the professor as saying.

At the same time, the State, scientists and entrepreneurs had been creating conditions for the development of sugarcane, he said.

Farmers should change the way of their thinking about growing sugarcane, apply the correct technical processes for selecting varieties, soil and fertiliser, while increasing links with businesses to improve sugarcane productivity and reduce production costs, he said.

Sugarcane was an important industrial crop, providing the main raw material for sugar production, an essential necessity in daily life, and at the same time contributing to poverty alleviation in many rural areas, added the professor.

The country's sugarcane plantations cover 270,000 hectares, with average sugar output reaching 1.3-1.5 million tonnes per year, creating livelihoods for over 35,000 farming households.

Sugarcane had many advantages over other short-term crops, said Xuan.

In terms of biology, sugarcane is widely adaptable and easy to cultivate, with good resistance to harsh natural conditions and environments. It also has the ability to regenerate, helping to reduce production costs.

In term of industry, sugarcane is a multipurpose tree, with possible economic benefits from root to top. Sugarcane stems can be used for sugar, wine, paper, plywood, pharmaceutical and electricity production.

Sugar cane tops and leaves can be used as green manure. In particular, the development of commercial electricity from bagasse is considered to have great potential, as currently biomass electricity only reaches about 26.5 per cent of the development target.

On the other hand, according to OECD-FAO forecasts, domestic sugar consumption in Viet Nam would increase by 5 per cent to about 1.8 million tonnes by 2023.

Quang Ninh plans to become dynamic development hub

The northern coastal province of Quang Ninh has set a goal of building modern industry and service sectors and becoming one of the region’s most comprehensive and dynamic development hubs by 2025.

The goal is part of the province's growth targets for 2020-2025, which were outlined in the resolution of the recent 15th provincial Party congress which took place from September 25-27. The other goals included building a strong and transparent Party and political apparatus; promoting unity, democracy, discipline, and innovation; mobilising concerted efforts for sustainable socio-economic development; and ensuring defence and security.

Regarding economic growth, the province aims to increase its gross regional domestic product (GRDP) by 10 per cent on an annual average during the period, and the per capita GRDP to over US$10,000 by 2025. The urbanisation rate is expected to surpass 75 per cent, while the rate of poor households is to go down to below 1 per cent.

Quang Ninh will work to maintain its leading position nationwide concerning the provincial competitive index (PCI), public administration reform (PAR) index, Satisfaction Index of Public Administration Services (SIPAS), and Public Administration Performance Index (PAPI). By the end of 2030, the province targets to complete the new-style rural building task.

To realise these goals, apart from Party building, Quang Ninh will implement socio-economic development solutions, which include restructuring the local economy with step-by-step development of the digital economy and developing services and tourism to make it a spearhead sector.

Quang Ninh will focus on increasing the proportion the processing and manufacturing industry accounts for in its economic structure, industries applying high-tech environmentally friendly technologies, and smart industries with high added value. The development of economic zones, coastal industrial parks, as well as coastal urban areas and economic corridors will also be prioritised.

The province will spare no effort to diversify its investment forms, accelerate growth, and complete synchronised infrastructure. Specifically, resources will be focused on completing the Van Don – Mong Cai highway in 2021, the Ha Long-Cam Pha coastal route, the Cua Luc 1,2 and 3 and other key projects in Ha Long City. The province will work with the northern coastal city of Hai Phong to get the Rung and Lai Xuan bridges open as soon as possible.

The congress identified three strategic breakthroughs of the province in the period. They were developing high quality human resources in association with increasing population scale and quality; speeding up the development of synchronised and modern strategic infrastructure; and promoting local cultural identities while shortening the income gap.

Concluding the congress, the re-elected Secretary of the provincial Party Committee Nguyen Xuan Ky highlighted such important factors for sustainable and fast growth in the future, such as a strong and transparent Party and political apparatus, anti-corruption work, loss of public asset prevention, and solidarity within the community.

Quang Ninh is viewed as a strategic destination in northern Viet Nam and an important link in the northern economic growth triangle of Ha Noi - Hai Phong - Quang Ninh.

The province possesses major advantages for Van Don District to become a multi-sectoral maritime economic zone and entertainment centre with a casino and high-end sea-island tourism and services. It is also a gateway for international trade, creating unique, modern, and high-quality products that are internationally competitive.

Over the past five years, Quang Ninh has experienced high and sustainable growth, with an average annual growth rate of 10.7 per cent. Average GRDP per capita is estimated at US$6,700 in 2020, two times higher than the national average.

It topped the PCI rankings for the third year in a row in 2019, according to the PCI 2019 report compiled by the Vietnam Chamber of Commerce and Industry.

In addition to the PCI, Quang Ninh also led the country in the PAR Index for three consecutive years from 2017 to 2019. The province has also been among the best performers in the SIPAS for many years and rose to the top in 2019.

It has made great strides forward in improving governance and public administration capacity, moving from 62nd place in 2016 to third last year on Viet Nam’s PAPI.

Quang Yen Coastal Economic Zone – new push for northern development

Deputy Prime Minister Trinh Dinh Dung has signed a decision to establish the Quang Yen Coastal Economic Zone in the northeastern province of Quang Ninh. Earlier this May, Quang Yen was added to the national plan for coastal economic zones.

Located in the southwest of Quang Ninh and on the border with Hai Phong, the zone covers a total area of 13,303ha built on two functional sub-zones including a nearly 6,900ha subzone for seaport services and an industrial zone named Dam Nha Mac, and over 6,400 ha for an urban area and high-tech sub-zone.

Quang Yen has three development goals, the first of which is to enhance economic, trade and services connections with other coastal economic zones such as Van Don, Dinh Vu – Cat Hai (Hai Phong) and Thai Binh, and develop socio-economic links between economic zones and neighbourhoods. Investment attraction to Quang Yen must work hand in hand with national defence and security, and the preservation and promotion of marine ecosystems and historical and cultural relics in the zone.

Secondly, the ambition is to develop Quang Yen into a centre of industry, services, logistics and a modern urban area for Quang Ninh and the Hong (Red) River Delta through the synchronisation of technical and social infrastructure, the development of hi-tech, environment friendly industries and a research and development centre.

These two goals must be achieved together with improvements to the workforce with increased incomes and employment opportunities.

The decision will enter into force from November 15, 2020, after which the Economic Zone Tax Package will be automatically activated for every new project in Quang Yen regardless of investment size and number of employees. This is a game-changer for enhancing the investment climate of the Quang Yen Economic Zone and Quang Ninh Province as it lures more capital flow from overseas and domestic investors.

Before the establishment of the Quang Yen Economic Zone, many investors already saw its huge potential and had elaborated on a long-term business plan to reap the benefits, including DEEP C Industrial Zones, an industrial zone developer backed by Belgian group Rent-A-Port.

“Connectivity and tax incentives are crucial criteria that investors take into consideration in their search for an investment destination. Quang Yen Economic Zone, with improved regional and global linkages through a series of mega projects and preferential tax incentives soon to be applied, satisfies both requirements,” said Bruno Jaspaert, general director of DEEP C Industrial Zones.
An industrial zone invested by DEEP C in Quang Yen Economic Zone. — Photo courtesy of DEEP C
DEEP C has invested in two industrial zones in Quang Yen Economic Zone called the Bac Tien Phong and Tien Phong industrial zones, but more generally known as DEEP C Quang Ninh. Of the nearly 6,900ha in the Dam Nha Mac subzone, DEEP C Quang Ninh occupies 1,680 hectares.

“Quang Yen is well-positioned for us to go beyond the industrial zone concept and build a seamless industrial zone ecosystem connected to seaports,” Jaspaert said, adding that the future investment plan for DEEP C was in sync with the development goals of the Dam Nha Mac sub-zone as an industrial zone, seaport and associated services complex.

“Besides, a 150,000-square-metre ready-built factory space in DEEP C Quang Ninh is scheduled to be built and put into operation next year,” he added.

With the new change, the Quang Yen Economic Zone now has on offer all the factors that are of prime concern in investment decisions: tax incentives, accessibility, governmental support. To further enhance the investment climate and prepare infrastructure for businesses to manufacture in a fast manner, Quang Ninh Province is calling for more experienced developers like DEEP C to raise the standard of industrial infrastructure. These will play an important role in developing growing Quang Yen into a high-tech and eco-friendly economic zone that contributes to the regional development of the Ha Noi – Hai Phong – Quang Ninh economic triangle.

Revised Law on Credit Institutions to cover bad debt recovery

The Government has directed the State Bank of Viet Nam (SBV) to add non-performing loan (NPL) settlement regulations under Resolution No.42/2017/QH14 into the revised Law on Credit Institutions, SBV’s deputy governor Nguyen Kim Anh said on Wednesday.

Addressing a forum on Viet Nam’s banking industry in 2020 held in Ha Noi, Anh said the restructuring of the credit institutions system, in association with bad debt handling, has been one of the key tasks of the banking industry during the 2016-20 period.

The National Assembly issued Resolution No.42/2017/QH14 in 2017 as a pilot programme for the first time to speed up the bad debt handling of credit institutions.

"The resolution has created positive changes and proved effective in the handling of bad debts and restructuring of credit institutions in the past few years", Anh said.

He said credit institutions have so far followed the resolution to build and implement their restructuring plans associated with bad debt handling in the 2016-20 period. As a result, credit institutions' credit quality has improved with their on-balance-sheet NPL ratio controlled below 2 per cent. Their size, financial strength, governance capacity and transparency have been also improved significantly, Anh added.

Besides, based on the resolution, inspection and supervision of competent authorities over credit institutions have been strengthened, which have contributed to removing cross-ownership of groups of shareholders in the institutions.

Nguyen Dang Phi, SBV’s deputy chief inspector, reported the NPL ratio of the banking sector has been gradually decreasing over the years, from 2.46 per cent at the end of 2016 to 1.99 per cent, 1.91 per cent and 1.63 per cent at the end of 2017, 2018 and 2019, respectively.

On average, the banking industry recovered some VND6.92 trillion (US$298.27 million) of bad debts per month by the end of July this year, much higher than the rate of VND3.94 trillion in the 2012-17 period.

However, deputy governor Anh noted the COVID-19 pandemic this year had adverse impacts on the restructuring and bad debt settlement of credit institutions in the 2016-20 period.

"If the pandemic continues, causing production and business to stagnate and affect the country’s economic growth adversely, the credit risk will rise and the pressure of bad debt will be very high. Therefore, meeting the Government’s targets of controlling bad debts is still a huge challenge for the banking industry," Anh said.

According to Do Giang Nam, deputy general director of the Vietnam Asset Management Company, despite its effectiveness, Resolution 42 is only a pilot programme and took effect for five years from August 15, 2017.

Therefore, Nam said, if there were no other regulations to replace the resolution after it expires, bad debt buyers would be concerned, causing a delay in the banking industry’s bad debt settlement. 

Viet Nam Rubber Group to expand tyre production via M&A

The Viet Nam Rubber Group JSC (VRG) plans to invest in tyre and tube production via mergers and acquisitions (M&As) over affiliate companies of the Viet Nam Chemical Group (Vinachem).

In a recent meeting with the Committee for Management of State Capital (CMSC), GVR said that they were focusing on restructuring the business, increasing investment in the rubber industry, adding that the M&As would help close the value chain of rubber tyre and tube products.

Currently, GVR is focusing on five main activities of planting and processing rubber latex, processing rubberwood, processing rubber industrial products, running industrial parks on rubber cultivation land and high-tech agriculture.

In the natural rubber segment, GVR is managing more than 400,000ha of rubber with an average yield of 1.56 tons per ha in 2019. However, this business has been on a downward trend in recent years due to low selling prices.

The impact of the COVID-19 pandemic further hurts the demand for rubber, resulting in lower output.

Therefore, expanding tyre and tube production can help the group earn more. In fact, the group started to penetrate this segment in 2017, when it started to partner with The Southern Rubber Industry Joint Stock Company (Casumina or CSM) to produce VRG-branded rubber tyres.

Vinachem is a multidisciplinary conglomerate involved in chemical production. As for the tyre segment, Vinachem is a major player in the industry with four-member units producing rubber tyres, namely Da Nang Rubber (DRC), Sao Vang Rubber (SRC), Southern Rubber Industry (CSM) and Inoue Rubber Vietnam Co Ltd.

In 2019, there were 9.4 million units of bicycle tyres sold, 6.48 million units of motorcycle tyres sold and 3.43 million units of car tyres sold.

DRC has a slightly higher production scale compared to other units with the output of tires and tubes of all kinds accounting for about one-third of the whole group.

In the first half of this year, DRC recorded net revenue down 17 per cent to VND1.59 trillion (US$68.7 million). Pre-tax profit reached VND107 billion, down 3 per cent compared to the same period in 2019 and fulfilled 38 per cent of the yearly plan.

According to the company, rubber tyre exports had improved after being hit hard in the second quarter by COVID-19. Export sales in July and August were both estimated at over $6 million, higher than the average of $4.4 million per month in the second quarter.

A full-steel radial tyre factory with a capacity of 600,000 tyres per year has come into operation, doubling the capacity of rubber tyre products of DRC.

Regarding CSM and SRC, after difficult periods in 2017-2018, business results improved in 2019 and early 2020.

CSM's pre-tax profit reached nearly VND40 billion in the first half of this year, 4 times higher than the same period last year and fulfilling 27 per cent of the yearly plan.

In H1, CSM recorded output of 18.14 million units for motorcycle tubes, 3.73 million units for bicycle tubes, 3.29 million units for motorcycle tyres, 2.46 million for bicycle tyres, and nearly 2 million units for all kinds of car tyres.

SRC reported pre-tax profit of more than VND33 billion in the first half this year, up 88 per cent over the same period in 2019 and exceeding 58 per cent of the yearly plan.

The company reported output of more than 15.9 million units for all kinds of tyres and tubes, of which motorcycle tubes accounted for 6.77 million units, bicycle tubes 4.27 million units, bicycle tyres 3.24 million units, motorcycle tyres 1.1 million units and car tyres 286,364 units.

In early 2018, the Prime Minister issued a decision to restructure Vinachem during the 2017-2020 period. Accordingly, this group would have to divest capital in all three tyre companies to below 51 per cent.

At DRC, Vinachem once filed an auction of 17.2 million shares with a starting price of VND25,170 per share in May 2019. However, the auction was cancelled because no investors registered to purchase the shares. Vinachem is still holding nearly 60 million DRC shares, equivalent to 50.51 per cent of charter capital.

In contrast, at SRC, Vinachem also held an auction of 4.2 million shares with the starting price of VND46,452 per share and attracted four investors to buy all shares. After the divestment, Vinachem still holds 36 per cent of charter capital.

Vinachem still holds 51 per cent of capital of CSM and 24 per cent of capital in Inoue Rubber Vietnam Co Ltd. 

ASEAN Finance and Central Bank Deputies’ Meeting held online

The ASEAN Finance and Central Bank Deputies’ Meeting (AFCDM) was held online in Hanoi on October 1 in preparation for the sixth ASEAN Finance Ministers’ and Central Bank Governors’ Meeting (AFMGM) scheduled for the following day.

Participants discussed the outcomes of cooperative initiatives within the framework of the ASEAN monetary-financial integration roadmap and other regional financial cooperation initiatives.

They were also updated on the regional economic situation, the results of the G20 Finance Ministers and Central Bank Governors’ meeting, and preparations for ASEAN 2021, and considered the approval of the draft Joint Statement of the sixth AFMGM.

Despite COVID-19, ASEAN has made important strides forward in the implementation of its monetary-financial integration roadmap, contributing to realising targets in the 2016-2025 comprehensive plan on financial integration and strengthening policy dialogue and financial collaboration with partner countries.

The working group on capital market development has continued to promote finance sustainably via the application of ASEAN standards, including standardising documents on infrastructure funding.

Recommendations in the group’s sustainable finance report will serve as a reference for ASEAN member states to devise policies.

With the aim of fully removing barriers to financial services in the bloc, including insurance, securities, and banking, the working group on financial services liberalisation has completed eight rounds of negotiations, with the ninth expected to be completed next year. After next year, ASEAN will build a Framework Agreement on Services (AFAS), containing wider commitments.

Last year the ASEAN Insurance Forum adopted a Roadmap to the ASEAN Insurance Integration Framework, with a target of liberalising insurance services and opening financial service markets in 2021.

ASEAN finance and central bank deputies also agreed to approve reports from working groups, which will be submitted to the sixth AFMGM, slated for October 2, for consideration./.

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