BUSINESS NEWS IN BRIEF 10/9 Vietnam-WEF cooperation in agriculture becomes fruitful: official   Vietnam has been an important partner and worked closely with the WEF in various spheres, including the New Vision for Agriculture, according to Deputy Minister of Agriculture Le Quoc Doanh  Ahead of the World Economic Forum (WEF) on ASEAN to be opened in Hanoi on September 11, Deputy Minister of Agriculture Le Quoc Doanh has noted the outcomes of agricultural ties between Vietnam and the WEF and future cooperation prospects. Doanh said over the years, Vietnam has been an important partner and worked closely with the WEF in various spheres, including the New Vision for Agriculture (NVA). Joining this initiative in 2010, the country has promoted partnerships between the State and the private sector through public-private partnership (PPP) commodity-based working groups in the Partnership for Sustainable Agriculture in Vietnam (PSAV), aiming to achieve sustainable growth in local agriculture. So far, the PSAV has successfully implemented seven PPP working groups for coffee, tea, vegetables and fruits, aquatic products, pepper and spices, rice and agricultural chemicals, the official said. These commodity-based working groups have also piloted farming models and expanded the cultivation of new varieties and the application of environmentally friendly techniques. Nearly 220,000 farmers have been assisted to take part in demonstration farm models, received training and applied advanced farming measures that meet sustainability standards. Danh noted these models have satisfied socio-economic and environmental criteria of the 17 Sustainable Development Goals of the United Nations. The WEF has recognised that PPP commodity-based working groups in Vietnam have generated good outcomes and are one of the most successful models of its NVA in Asia, he added. The Ministry of Agriculture and Rural Development is pressing on with an agricultural restructuring plan to improve agricultural products’ added values and step up sustainable development. It is working to develop value chains in three groups: the national key group with 10 commodities with export turnover of more than 1 billion USD each, provincial key products and regional specialties. Promoting these value chains aims to increase the quality and competitiveness of Vietnamese farm produce, ensure inclusive growth and protect the environment. It is necessary to boost PPP-based production and investment models in agriculture, the Deputy Minister said. Doanh added the Ministry of Agriculture and Rural Development wants the WEF, through the Grow Asia initiative, to continue assisting Vietnam’s agriculture to restructure. Vietcombank sells entire OCB stake      Vietcombank sold all 1.47 million shares of Orient Commercial Bank (OCB) at an auction on Thursday. According to the Ha Noi Stock Exchange, two individual investors bought the shares at a total cost of more than VND30 billion (US$1.27 million). The winning price averaged VND20,501 per share, of which the highest winning price was VND22,200 and the lowest was VND20,500. The price was higher than the starting price of VND18,876 set by Vietcombank, but some 20 per cent lower than a sale in April this year. In April, Vietcombank also sold 6.67 million OCB shares to 128 investors at an average price of VND25,771 per share, compared with the starting price of VND13,000 set by Vietcombank, helping the bank earn VND171.96 billion. Offloading holdings at OCB is one of Vietcombank’s moves to comply with the central bank’s Circular 36, which allows commercial banks to hold shares in a maximum of two other credit institutions, with the stake in each not exceeding 5 per cent of the total equity of that institution. Apart from OCB, Vietcombank also plans to divest from Eximbank and Military Bank, where it holds stakes of 8.19 per cent and 6.97 per cent, respectively. The northern bourse said OCB’s charter capital had reached VND5 trillion, with more than 122 branches and transaction offices nationwide. OCB reported impressive business performance in the first half of this year with pre-tax profit of more than VND1.3 trillion, rising 163.5 per cent year-on-year and meeting 65 per cent of the bank’s target set for 2018. OCB plans to list 750 million shares on the HCM Stock Exchange during the late third quarter or early fourth quarter to increase in the bank’s market capitalisation to $1 billion.  HCMC textile industry on the rise      The HCM City textile and garment industry has achieved growth of 10.5 per cent in the first eight months. According to the city’s Department of Industry and Trade, a raw materials supply chain consisting of textile, dyeing and garment companies has been successfully set up, helping reduce imports and even export to some foreign markets. Exports of feedstock during the period were worth US$125.5 million, a year-on-year increase of 10.4 per cent while imports fell by nearly 1.1 per cent to $485 million. The city’s Garment Textile Embroidery and Knitting Association said design is the most important aspect in creating value for the textile and garment industry, and city’s companies are focusing on design and distribution while production is being shifted to neighbouring provinces. This has enabled companies to take advantage of low-cost labour in neighbouring provinces and focus on increasing their competitiveness. Many textile and garment enterprises have taken advantage of free trade agreements (FTAs) with Japan, South Korea and Australia to increase their exports, while other important trade deals like the CPTPP and Viet Nam-Europe FTA are set to come into effect soon, Sai Gon Giai Phong (Liberated Sai Gon) newspaper quoted Nguyen Thi Tuyet Mai, chief representative of the Viet Nam Textile and Apparel Association in HCM City, as saying. Viet Nam is one of world’s top 10 exporters of biggest textile and garment products. The Vietnamese textile and garment industry has achieved a strong foothold in international markets, but has not paid attention to building brands, analysts said. Mai said: “Many Vietnamese textile and garment products are sold in the international market under the brand names of Thai, Chinese and European companies. Therefore, the value added by the industry is not high.” The Ministry of Industry and Trade said to improve the situation it is working with relevant agencies to set up an export capability support project for local enterprises. It would assist enterprises that do not have export experience export their products under their own brand names through foreign retailers in Viet Nam like Aucham, Lotte, Aeonmall, and Metro, the ministry said. This would allow them to become familiar with international quality, design and safety standards, it said. For those with experience, it would instruct commercial counselors abroad to provide up-to-date information and support, it said. It is also making plans to advertise Vietnamese products, changing the focus, which used to be on price, to upmarket segments, it said. Nguyen Phuong Dong, director of the industry and trade department said his department has identified three key textile and garments products. It has also identified three locations for building fashion centres in District 9, two in Truong Thanh Ward and one in Long Thanh My Ward, and the city’s administration will choose one of them. “This fashion centre will help add value to the textile and garment sector,” Dong added.  Petrol prices rise after stable two months      The retail price of biofuel E5 RON 92 rose VND300 to VND19,911 (85 US cent) per litre on Thursday after two months remaining unchanged, the ministries of industry and trade and finance have announced. The price of RON 95 also rose by VND300 to VND21.477 per litre, while the prices of diesel and kerosene went up by VND383 and VND296 to VND18,069 and VND16,559 per litre, respectively. The price of mazut increased by VND173 to VND14,916 per kilo. According to the Ministry of Industry and Trade (MoIT), the two ministries review fuel prices every 15 days to adjust the prices in accordance with fluctuations on the world market. The global price for RON92, which is the base for the production of E5 petrol, stood at $85 per barrel in the 15-day period prior to September 5, increasing $3.22 a barrel. RON95 was sold at $87.2 per barrel, up $4.8 from the previous adjustment. The two ministries also decided to increase the use of the petrol price stabilisation fund for E5 RON 92 from VND1,272 to VND1,563; RON 95 from VND697 to VND960; diesel VND400 and kerosene VND300 per litre. Kerosene and diesel did not use the fund in the previous adjustment. The price of ethanol E100, which is used as the basis for the calculation of the price of biofuel E5 RON 92 after the elimination of petrol RON 92, stands at VND14,874 per litre without value added tax.  VN-Russia trade booms, but there’s room to grow      Viet Nam and Russia have enjoyed booming bilateral trade, but more efforts are needed to match potential. According to the General Department of Viet Nam Customs’ data, Viet Nam has recorded a trade surplus each year with Russia since 2011. Two-way trade turnover has risen and hit a record US$5.23 billion in 2017, up 36 per cent on-year. In the first seven months of this year, the trade surplus reached $265 million, down 39 per cent against the same period last year. The decline was thanks to stronger growth in imports compared to exports. Ending July, Viet Nam sold goods worth almost $1.47 billion to Russia while spending $1.2 billion on imports from the country. These figures represented growth of 21 per cent in exports and 55 per cent in imports year-on-year. Russia was the 19th largest trading partner of Viet Nam in the first seven months.  It is a key market for Viet Nam’s key export products such as telephones and components ($710 million, up 15.6 per cent), computers and electronic devices ($120.6 million, up 81 per cent) and coffee ($113 million, up 64 per cent). On the opposite side, wheat was Viet Nam’s top import product with value of $358.4 million, 32 times more than the same period of last year and accounting for nearly 30 per cent of the total import value. In the first seven months, Viet Nam imported coal from Russia for the first time with value of $145 million, being the second highest import value item. Besides, iron and steel, fertiliser, machinery and spare parts and petroleum were among the main import items. These six products accounted for 75 per cent of the total value of Viet Nam’s imports from this market. According to Vladimir Buianov, chairman of the Russia-Vietnam Friendship Association, the two countries still have a lot of co-operation potential. “The current results are clearly too low. I think the $10 billion trade value target will be achieved within 2-3 years, with just one kick,” Buianov told Vietnam News Agency. More discussion and agreements have been made by the two countries but they still need to be put into action, he said, suggesting co-operation expansion among small and medium enterprises. Russia currently ranks 23rd among countries and territories investing in Viet Nam with total registered capital of $931.6 million (including projects valid as of August 20), according to the Foreign Investment Agency under the Ministry of Planning and Investment. Russia’s projects are mostly in oil and gas, manufacturing, mining, transport, telecommunications and aquaculture and fishing. Meanwhile, Viet Nam has invested in 18 projects in Russia, with combined registered and added capital of $2.4 billion by the end of March 2018. Most of the investment comes from projects invested by Rusvietpetro joint venture, Hanoi-Moscow Trade Centre Investment JSC and a dairy cow breeding and milk processing in Moscow of TH Group. To date, 17 projects are among Viet Nam-Russia prioritised projects, which were approved at the 20th session of the Viet Nam-Russia Intergovernmental Committee for Economic-Commercial and Scientific-Technological Cooperation in September 2017. These projects are in oil and gas, transport, agriculture, electricity, construction, industry and high technology. The two sides are working on a plan to implement the projects.  Start-ups need to think for themseves      Start-ups in the field of hi-tech agriculture must think for themselves and not follow previous models. This was the message that came out of a discussion panel yesterday which urged new businesses to research and fully understand the market. Hoang Minh Ngoc Hai, CEO of Value Commerce Hub, said hi-tech agriculture offers solutions to consumers and businesses’ demand for clean, high-quality produce, improving farming productivity and creating reliable databases. But the use of technology in agriculture remains limited since it is still relatively new in Viet Nam and many farmers are still used to traditional methods and mindsets, he said. Huynh Kim Tuoc, CEO of Saigon Innovation Hub, said despite lots of interests from investors, many start-ups lack longevity and innovation, which reduces their competitiveness, since they merely try to emulate successful examples. Nguyen Viet Duc, CEO of Innovation Capital Management, said the rate of businesses investing in hi-tech agriculture is still relatively small. “Many young entrepreneurs often copy ideas from other businesses or provinces they deem applicable without really analysing their local markets or whether they can actually successfully execute the ideas.” Careful research into markets and technologies, seeking consultancy and having innovative solutions are crucial to attracting investments, and many investors are indeed keen on investing in hi-tech agricultural start-ups, he said. Hai said encouraging the use of technology would require raising awareness of its benefits as well as highlighting current local and societal problems. Start-ups need to have a thorough understanding of the Viet Nam market, culture and climate and network with professionals from various fields to succeed. The discussion was part of a conference organised by Saigon Times newspaper’s Saigon Times Club, which also launched the Saigon Times Start-ups Assistance Club to foster entrepreneurship.  Vietnamese Entrepreneurs Abroad association to open office in Can Tho     The Association of Vietnamese Entrepreneurs Abroad (BAOOV) and the People’s Committee of Can Tho City will jointly speed up the establishment of BAOOV’s representative office in the Mekong Delta region’s Can Tho City at a meeting held in the city on Thursday. According to Peter Hong, vice chairman of BAOOV, the association has branches in more than 50 countries. The mission of the association in general and branches in particular is to create a network to connect Vietnamese enterprises around the world together; provide legal advice as well as information to help businesses increase competitive advantages in the market, building a strong brand for products exported from Viet Nam. Particularly for the Mekong Delta, there are advantages in export of agricultural and fishery products, but it is only advantagous in quantity instead of value of products and turnover. Therefore, the establishment of BAOOV’s representative office of the Mekong Delta region Can Tho is expected to help agro-forestry export enterprises in the region reduce losses due to lack of import market information and increase profits through the building of strong brands. The office will also act as a bridge between local authorities and Vietnamese businessmen around the world, attracting them to invest in Viet Nam; sending the voice of overseas Vietnamese businessmen to the authorities, thereby contributing to the promotion of multinational trade more effectively. Truong Quang Hoai Nam, vice chairman of Can Tho City People’s Commitee, said the city is ready to create favourable conditions for members of the association to set up branches in the city. At the meeting, Nam also introduced and connected the association with focal points in Can Tho such as the Young Businessmen Association, City Business Association, Centre for Student Development and Support and Department of Industry and Trade in order to promote the establishment of the office as well as plan for trade promotion activities. Biggest livestock trade show to open in HCM City in October      As many as 350 businesses will take part in Vietstock 2018, the biggest livestock trade show in Viet Nam, in HCM City. Speaking at the press conference, Nguyen Xuan Duong, acting director of the Ministry of Agriculture and Rural Development (MARD)’s Animal Husbandry department, said processing and market connectivity are the two weakest points in the domestic livestock industry. He aims to improve these areas through concentrated slaughter and processing. “The livestock and seafood industries are on a path towards enhanced processing and market connectivity,” said Duong. “When we have met the country’s demand, it is time for us to focus on potential export markets.” He said this exhibition, that runs on October 17-19, is also an opportunity for animal husbandry businesses to seek partners in order to meet both domestic and export demands. More than 350 leading companies from all over the world will showcase their new products and technologies. Twelve thousand visitors and trade delegates are expected to attend. The international conference will offer seminars on environmental law, the latest industry innovations, market trends and other issues. Dialogue sessions between Viet Nam and China, South Korea and Brazil will also take place. "It is not simply a regular exhibition; VIETSTOCK 2018 will connect farmers, households, cooperatives and businesses in Viet Nam, moving them towards sustainable and effective animal husbandry," said Duong. VIETSTOCK 2018 Expo and Forum continues to include VIETFEED 2018, VIETMEAT 2018 and the Aquaculture Vietnam 2018 Conference, providing a one-stop venue to all who are involved in livestock, feed, meat and aquaculture. It is jointly organised by MARD’s Animal Husbandry Department and UBM Asia.  HCM City’s innovation district, a launch pad for 4th industrial revolution      By merging districts 2, 9 and Thu Duc into a single innovation district, HCM City wants to create a new driving force for economic prosperity in the era of the fourth industrial revolution. According to Nguyen Thien Nhan, secretary of the city’s Party Committee, the city, the country’s economic hub, accounts for just 0.6 per cent of the land area and 10 per cent of the population but 22 per cent of the GDP and 27 per cent of the Government’s revenues. The number of university graduates in its workforce and labour productivity are, respectively, 2.3 and 2.7 times the country’s average. But the city has encountered challenges amid increasing globalisation and rapid development of technologies, while its rapid economic development and urbanisation have put pressure on socio-economic infrastructure. Nhan said: "In the coming decade the city wants to achieve rapid and sustainable economic growth, increase labour productivity, contribute 30 per cent of the country’s GDP, and become Viet Nam’s ’core’ during the fourth industrial revolution." So it has identified breakthrough solutions, including establishment of the “innovation district” in the east of the city to enable it to achieve the targets. Explaining the reason for choosing the three districts, he said Thu Duc has a high concentration of educational institutions, research centres and four large universities with more than 10,000 lecturers, including over 1,000 professors and doctors, and over 100,000 students. "So it would serve as a place for training high-quality human resources." "District 2 with the new Thu Thiem Urban and Financial Centre would provide infrastructure and international exhibition and financial centres for the innovation urban area and the city as a whole," he said. District 9 with the Saigon Hi-Tech Park would be a "hub for research and incubating innovative technologies", he said. The eastern area also has convenient and modern infrastructure, including Metro Line 1 from Ben Thanh in District 1 to Suoi Tien in District 9, the expressway from HCM City to Long Thanh-Dau Giay in Dong Nai Province and Cat Lai Port, the largest in Viet Nam. "Creating the innovation district is aimed at creating close interaction between research centres, training schools and hi-tech factories, and at the same time provide a good working and studying environment for experts, scientists and skilled human resources," city deputy chairman Tran Vinh Tuyen said. "Governance of the innovation hub would be done online and be transparent and without red tape. Once in place, these areas will be the launch pad for the city’s fourth industrial revolution," he said. Prof Phan Van Truong, an expert on the urban economy and planning, hailed the idea of building an innovation urban area. “We must think that HCM City will spearhead the nation’s economic development, and the eastern districts have a solid foundation to develop further.” "But to make this plan work, the city has to start with the basics, namely traffic infrastructure," he said. “We must build a fully new urban area where priority is given to pedestrians, buses and metro and no longer motorcycles and private cars.” Former director of the HCM City Institute for Research and Development, Prof Dr Nguyen Trong Hoa, said: “The policy of creating an innovative district in the east of HCM City has revolutionised the urban management task of the city, lessening the gap between Viet Nam and other modern developed metros around the world.” Many experts have thrown their weight behind this initiative, but some expressed concern. Pham Chanh Truc, former deputy secretary of the municipal Party Committee, said: "The city should carry out the plan step by step by first designating a smaller area as the innovation district and then expanding it because it would involve huge expenditure." Pham Thai Son of the Viet Nam-Germany University agreed saying the city’s resources would be insufficient. Pointing out the possible obstacles the city could face in creating the innovation district, Dr Nguyen Cao Tri of Van Lang University said: "It is difficult for the city to change the management mechanism immediately. So it must find creative ways based on current policies." He and other experts suggested the city should "prioritise the role of the private sector in the innovation district” because “the private sector … will immediately make investments when they see efficiency”. Many experts said the city needs "specific policies and mechanisms for the development" of an innovative urban area. Speaking at a recent forum to discuss the vision for the innovation district, Ousmane Dione, the World Bank’s country director in Viet Nam, said: “A clear vision, good planning and well-skilled workforce are keys to a successful innovation district.” "Global experience shows that to successfully create an innovation district, a city needs to have a clear vision from the outset. Sound urban planning, policies and management of the innovation district and integration of the district with the rest of the city are crucial. “It is important to know that since we are planning for innovation districts, we need to think beyond innovation districts and consider regional and global factors, trends and incentives which influence the outcome of these initiatives.” Therefore, when cities adopt urban plans and management policies, "harmonisation between innovation districts and the rest of the city’s economy and development needs to be considered", he said. “Innovation districts, if developed successfully, contribute to job creation and inclusive economic development of a city.” The city has said it will continue to involve international and local advisory agencies to draft a master plan for the innovative district.  Dong Nai trade surplus makes up 64 per cent of country’s total      The southeastern province of Dong Nai achieved a record trade surplus of US$1.8 billion in the first eight months of the year, the highest in the country, according to the provincial statistics office. In the first eight months of the year, total exports reached $12.2 billion in the province, up by nearly 12 per cent compared with same period last year, while the total import value for the period was $10.4 billion. According to the General Statistics Office (GSO), the country gained a trade surplus of $2.8 billion in the first eight months of this year, making up 64 per cent of the country’s total. The province has around 50 products with high export turnover, including textiles and garments, footwear, wooden products, and steel, exported to around 170 countries and territories. The products are highly regarded by foreign businesses. For the first eight months of the year, the province’s footwear exports reached more than $2.4 billion, up by 11 per cent compared with same period last year, while garment and textile value reached $1.3 billion, up by seven per cent, and textile fibres rose to $1.1 billion, up by 17 per cent. Dong Nai’s main export markets are the US, the EU, South Korea, China and Japan. Businesses in Dong Nai are increasingly taking advantage of trading blocs and free trade agreements that Viet Nam has inked with other countries, as well as the ASEAN Economic Community. The Dong Nai Province’s Department of Industry and Trade said the province’s trade surplus would reach more than $2.5 billion this year. Last year, the trade surplus of Dong Nai reached $2.2 billion, making up 77 per cent of the country’s surplus of $2.7 billion.  HCMC tech companies get licences      Duc Thanh Investment and Technology Joint Stock Company on Friday received an investment licence from the Saigon Hi-tech Park in HCM City for a high-tech factory to produce building materials. The company has invested more than VND269 billion (US$11.8 million) in a production line to make unbaked bricks with fully automated transportation, loading and unloading and packing using robots. It will recycle products from coal ash to reduce pollution. The factory is expected to become operational in the first quarter of next year. Nguyen Quoc Huy, chairman of the company, said the plant would produce eco-building materials to replace imports. On the same day Misan Electronics Co Ltd also received the certificate for a plant that will produce components for electronic devices for companies in the Hi-tech Park. The total investment of the project is $1.1 million.  WWF report warns ASEAN banks      A new World Wild Fund for Nature (WWF) report finds that ASEAN’s biggest banks are increasingly aware of the impact their businesses have on the environment and society, but are slow to act on the huge potential they hold in addressing climate change and financing sustainable food, energy and infrastructure systems in the region. The report, published in collaboration with the National University of Singapore (NUS) Business School’s Centre for Governance, Institutions and Organisations, found that ASEAN banks were not disclosing how they managed climate risks in line with the recommendations of the Taskforce for Climate-related Financial Disclosures (TCFD). The region is particularly vulnerable to climate change, which exacerbates food and water insecurity. By not considering these issues, banks stand to miss out on ‘game changing’ opportunities for the region’s sustainable development and may face unmitigated climate risks in their own balance sheets, according to the report. Of the 34 banks assessed in six Southeast nations, including Viet Nam, only four disclosed that senior managers have oversight of climate change risks and opportunities, a key recommendation of the TCFD. Meanwhile, none of the banks disclosed whether they had reviewed their portfolio exposure to climate risks. They had also not disclosed their portfolio alignment with the Paris Climate Change Agreement or Sustainable Development Goals (SDGs). Although some progress on Environment – Society – Governance (ESG) integration has been made, particularly on the part of Singaporean banks and a few Malaysian and Thai banks, disclosure of specific ESG requirements of banks across ASEAN remains limited. Nineteen banks disclosed they have a standardised framework for ESG risk assessment, but only seven disclosed that they have specific policies for high ESG risk sectors. Even then, disclosure of the policies themselves is limited, with just three banks disclosing one or two of their key policies. Regarding specific environmental and social risks, only five banks in ASEAN recognised deforestation risks - a key contributor to climate change - in their clients’ activities and only two recognised water risks. Given these are key risks for the food and agriculture sector highlighted by the TCFD, the implications for regional food and water security are worrying. Vietnamese banks have shown slight progress, with more banks understanding that their impact lies in their portfolios rather than their own direct operations. However, they have not disclosed ESG policies and processes, indicating that disclosure is not yet a mainstream practice. The report finds that ASEAN banks are capitalising on opportunities in response to climate change and the need for sustainable development with 22 banks disclosing they have developed green financial products such as green bonds and sustainability-linked loans. However, these niche products will not be sufficient on their own for the huge investments required to meet the Paris Agreement and the SDGs by 2030. In order to properly capitalise on this opportunity, banks must set science-based targets to align their portfolios to a resource- and carbon-constrained world. The report finds that banks in ASEAN have not yet done this, and may be missing out on opportunities while continuing to be vulnerable to the impending transition and physical risks of climate change. If the ASEAN region is to experience resilient and sustainable development, banks must accelerate the rate at which they fully integrate ESG, including climate, deforestation and water risks, into core business strategies. Banks play a crucial role in financing the transition to sustainable food, energy and transport systems in ASEAN and must be part of the solution. Responsible investors, as stewards of capital, need to ensure that their portfolio banks are making timely progress on this, and engage actively with them to support the transition.  Khanh Hoa works to attract more tourists from ASEAN nations Authorities of the south central province of Khanh Hoa see the need to attract more tourists, especially from member countries of the Association of Southeast Asian Nations (ASEAN).  Many measures have been devised, focusing on promoting the province’s images and developing its infrastructure.  Khanh Hoa, with a coastline of more than 380 km and hundreds of islands and islets, and mild and sunny year-long climate, has many advantages for tourism, especially sea-island tourism. Besides Nha Trang Bay, Khanh Hoa also boasts Cam Ranh and Van Phong bays, both being natural masterpieces.  Khanh Hoa’s tourism sector has experienced a breakthrough in recent years. The number of tourists visiting the province has enjoyed average expansion of 15 percent - 17 per year in recent years.  In 2010 - 2016, the number of tourists to Khanh Hoa reached 21.5 million, including more than 5.1 million foreigners. In 2017, 5.5 million domestic and international holiday-makers visited and stayed overnight in the locality.  In the first eight months of this year, Khanh Hoa welcomed 4.4 million visitors, including nearly 1.9 million foreigners.  However, Khanh Hoa has not focused on attracting tourists from ASEAN countries. With nearly 1.9 million visitors to Khanh Hoa from the beginning of the year, the number of visitors from ASEAN countries is less than 100,000.  In September last year, low-cost airlines AirAsia of Malaysia opened a direct flight from Kuala Lumpur  to Cam Ranh International Airport of Khanh Hoa and vice versa.  According to Spencer Lee, Commercial Director of AirAsia, the new route helps not only bring more holiday-makers from Malaysia to Khanh Hoa, but also makes it easy for Khanh Hoa people and those from adjacent localities to access 120 destinations in the airline’s Asian network.  A number of international travel agencies in Khanh Hoa’s Nha Trang city have taken advantages of the new route to run tours to Malaysia and Singapore.  After a year, the number of visitors from Malaysia to Khanh Hoa has increased tenfold. In the first eight months of 2018, Khanh Hoa received more than 30,000 visitors from Malaysia, up 15 times compared to the same period last year. Khanh Hoa aims to welcome 8.5 million tourists by 2020, with 3.5 million international visitors, raking in 70 trillion VND (more than 2.98 billion USD). The province’s tourism industry is hoped to become a spearhead economic sector, creating momentum for its development. Renewable energy integration faces challenges Power drawn from renewable energy is expected to soar in the future, although the country’s capacity to integrate this source of energy into the national power grid is still limited, possibly causing throttling on the network, heard attendants at a seminar held in Hanoi last week. The seminar, entitled ‘Renewable Energy Integration: Challenges and Technology,’ co-organised by the Ministry of Industry and Trade (MOIT) and ABB Vietnam, aimed to explore the challenges in achieving Vietnam’s ambition to increase the generation and consumption of renewable energy, and how technology can help resolve them. Nguyen Van Thanh, Deputy Director of the Electric and Renewable Energy Department under the Ministry of Industry and Trade, said Vietnam has seen rapid development of power plants which posed great challenges to transmission networks. According to Vietnam’s Power Development Master Plan for the 2016-2020 period (PDP VII), the demand for electricity consumption in Vietnam will increase by about 10-11 percent annually, which exceeds the annual GDP growth rate. As one of the fastest growing economies in the region, Vietnam is experiencing rapid industrialisation. In parallel with the industrialisation process, people tend to move to cities and vast urbanisation is taking place. To support socio-economic development sustainably, the country is encouraging renewable energy development to reduce the dependence on fossil fuel based energy. Under the plan, the total designed capacity of solar power generation must amount to 850MW in 2020 and 4,000MW by 2025. Meanwhile, the total capacity of solar and wind power set for 2030 are 12,000MW and 6,000MW, respectively. “However, fossil fuel accounted for more than half the country’s power in 2017 according to an annual report by Electricity of Vietnam (EVN),” he said. The PDP VII outlines active steps that Vietnam is taking to develop renewable energy resources in order to meet the country’s electricity demand, in which renewable energy will account for 10 percent of the country’s power generation by 2030 (12 GW). The plan also outlines the need to invest in a power transmission grid with flexible operation and high automation capabilities from electricity transmission to distribution; as well as developing unmanned substations and substations. In addition, it highlights the need to accelerate electrification in rural and mountainous areas to ensure access to electricity of households by 2020. Sharing the opinions, Nguyen Minh Quang from Power System Analysis and Planning under the EVN’s National Load Dispatch Centre, said Vietnam produces more than 170 billion kWh from fossil fuel based energies such as coal and gas. “Vietnam has had to import coal for power generation since 2017. The investment for thermal power plants faces difficulties due to capital shortage as banks have not encouraged lending to coal-fired electricity plants but renewable energies,” Quang said.  However, power grid conditions are not prepared to adopt this kind of energy, he added. It takes three years, on average, to build a power grid project, while a solar power project needs only one year to be put in place. As a result, electric grid development cannot catch up with the proliferation of solar and wind power projects. Brian Hull, General Director of ABB Vietnam, noted that Vietnam should apply advanced technology to cope with challenges in its power system. Simultaneously, the country should upgrade electric load and controlling systems, to ensure it can promptly tackle potential incidents. Venu Nuguri, Group Senior Vice President for ABB’s Power Grids Division in South Asia, Middle East and Africa, said as the country moves towards clean energy, the power grid will need to adapt to the influx of renewable energy, which is intermittent and also characterised by distributed generation. “Not only does this call for wider industry collaboration and policy discussions, it is also important to make the right technology choices. Technology will enable the grid to be flexible and adapt to the new realities of distributed generation and multi-directional power flow. Digitalisation is key to create the power grid of the future,” he added. WEF ASEAN 2018: Chances for Quang Ninh to draw capital from Northeast Asia The northern province of Quang Ninh will be the destination for a two-day field-trip of delegates to the World Economic Forum on ASEAN (WEF ASEAN) 2018, which it considers a good chance to attract more investment from the Northeast Asian region. Many of Quang Ninh’s important investment, trade and tourism partners are located in the Northeast Asian region. Out of the 120 valid foreign-invested projects in the province, 79 are run by firms from Northeast Asia with total investment capital of 2.1 billion USD. China has 66 projects capitalised at 1.7 billion USD in Quang Ninh, mostly involving tourism-hospitality, service, industry, mining, construction materials and fiber production. Japanese investors have poured more than 380 million USD in 7 projects in Quang Ninh, focusing on industry-construction and agriculture. Investors from the Republic of Korea have 6 projects with 33 million USD operating in agriculture, trade and service. Since 2012, nearly half of 127 investor delegations visiting Quang Ninh to look for investment opportunities are from the Northeast Asian region. In the field of tourism, Quang Ninh set up ties with several Chinese localities such as Guangxi, Fujian, Yunnan and Hainan in as early as 1995. The province became a member of the East Asia Inter-Regional Tourism Forum (EATOF) in 2006, which gave a boost to linkages in tours, tourism promotion, product development, brand building and experience sharing between Quang Ninh and 12 provinces in East Asian countries which are members of the forum. Total trade turnover between Quang Ninh and the three Northeast Asian countries of China, Japan and the Republic of Korea surpassed 1 billion USD in the first half of 2018, with Quang Ninh’s exports valued at 537 million USD. Pham Ngoc Thuy, Director of the province’s Tourism Department said the Northeast Asian region is the most important market for Quang Ninh’s tourism, accounting for two thirds of the number of foreign visitors to the province. Arrivals from this region during 2013-2017 increased by 48 percent compared to the previous five–year period. Despite such figures, economic experts are of the opinion that Quang Ninh has not fully optimised available opportunities. They pointed out that investment into the province mainly concentrated in tourism, service and industry, with only a small fraction going into agriculture and forestry even though those two sectors have great potential and offer many incentives for investors. Agriculture and forestry have so far attracted only 6 out of 79 projects of Northeast Asian investors with 61.7 million USD, which caused an imbalance in the economic structure. While Japan and the RoK are the two leading investors in Vietnam, Quang Ninh has so far failed to catch the attention of companies from those two Northeast Asian economic powers. In the first six months of this year, Japanese investment in Quang Ninh stood at only 43.4 million USD, and that from the RoK 31.4 million USD. In addition, a majority of projects by Northeast Asian investors in the province are of medium and small scale. Among the 79 investment projects by investors from the region, only 10.1 percent have registered capital exceeding 50 million USD. Deputy Director of Quang Ninh’s External Affairs Department Vu Dinh Xung said the province will work to intensify its partnership with localities in the Northeast Asian region in trade, investment and tourism promotion. The province has reviewed its investment promotion in order to find shortcomings and seek suitable solutions. Xung added that a series of major transport projects have been or will be put into operation soon, such as the Hai Phong-Ha Long-Van Don highway, the Van Don international airport and the Hon Gai international port, greatly improving Quang Ninh’s connection with the world. He said Quang Ninh will optimise its advantages to create a breakthrough in wooing partners over the world in general and in the Northeast Asian region in particular. The WEF ASEAN 2018 will receive more than 1,000 delegates, including high-ranking government representatives and executives of regional and world-leading corporations. It is scheduled to take place in Hanoi from September 11 to 13 under the theme of “ASEAN 4.0: Entrepreneurship in the Fourth Industrial Revolution”.  The forum will feature an open forum on ASEAN 4.0 for people’s benefits, an opening ceremony of the plenary session on September 12, and 60 in-depth sessions and discussions.  On the sidelines, an innovative startup forum is scheduled for September 11, the Vietnam Business Summit 2018 on September 13, and a two-day field trip to Quang Ninh province and its world-famous Ha Long bay starting September 13.  VNN