BUSINESS NEWS HEADLINES JUNE 4 01:07         Hanoi to turn Hoa Lac into sci-tech hub    The new urban area is expected to become a driving force for socio-economic development of suburban districts. The Hoa Lac new urban area on the outskirts of Hanoi will become a science and technology urban center as Vietnam seeks to advance its economy and reduce population density pressure on the downtown of the capital city.  Hoa Lac urban area will become a driving force for socio-economic development of rural districts. According to the latest general planning for 2025 approved by the prime minister, with a surface of over 17,000 ha, Hoa Lac township comprises areas of two districts of Quoc Oai and Thach That, and Son Tay town. It is planned to be a modern urban area with uniform social and technical infrastructure and a driving force for socio-economic development of rural districts. The township is expected to focus on developing modern technologies, training high-quality human resources; researching science and high technology for the whole country. It will become a center of national universities and vocational colleges; medical center, among other purposes. The place will also become an eco-urban area which would be a green, smart, energy-saving urban center to the west of Hanoi. Hoa Lac will be divided into two specific zones: urban development zone and green zone. The urban development zone includes Hoa Lac Hi-Tech Park (1,600 hectares), Hanoi National University (1,000ha) and Dong Xuan - Tien Xuan new urban area (1,250ha). The green zone will surround the inner city, which is delimited by urban ring roads, including the agricultural area in west of the Tich river, Vietnam Mountain Forest Ecoregion, Hoa Lac airport area connecting with Dong Mo Lake and the Ba Vi National Park. The population of the Hoa Lac urban area is estimated at about 150,000 by 2025 and 600,000 by 2030. Monthly CPI falls to lowest in five years According to the General Statistics Office, the CPI in May decreased by 0.03 per cent compared to April, down 1.24 per cent from last December, the lowest level since 2016. However, the average CPI of the first five months of this year still increased by 4.39 per cent over the same period in 2019. The office said inflation was controlled in May even when pork prices were increasing. This was thanks to the Government’s synchronous implementation of support policies for local businesses and people during the COVID-19 pandemic. It was also helped by an initiative to control petrol prices and the proactive monetary policy of Vietnam./. Malaysia seeks to reinvigorate tourism industry amidst COVID-19 Malaysia could set up travel bubble with other ASEAN nations such as Singapore, Vietnam and Thailand, said Zaidi Isham Ismail in a recent article posted on New Straits Times. The writer explained that the bubble or corridors denotes a safe or a protected perimeter between two travel destinations or countries or states already declared as green zones ready to receive tourists which is set to help the tourism sector recover. In Malaysia, he said, the obvious and nearest travel bubble is with Singapore. “Perhaps the two countries could consider setting up their very own travel bubble”, he said. Subsequently, this concept could be expanded to the rest of ASEAN such as Vietnam and Thailand which are also headed towards green zone status, he added. The essential requirement of implementing this initiative is trust between countries and cooperation of multi agencies, according to the writer./. Viet Nam’s agricultural exports decline in May due to COVID-19 Exports and imports of agricultural goods saw a decline in the first five months of 2020 due to the negative impacts of the COVID-19 pandemic, according to the Ministry of Agriculture and Rural Development (MARD)’s monthly report last week. Export value in the first five months of 2020 saw a decline of 4.1 per cent year-on-year and was valued at US$15.5 billion. Coffee, rice and vegetables were among the commodities with the strongest export growth, whereas rubber, tea and pepper saw a sharp fall. China is Việt Nam’s largest exporting market of agricultural products, with export turnover at $3.7 billion, a 15.5 per cent drop in value, closely followed by the US and the EU, reaching $3.4 billion and $1.6 billion, respectively. Nguyễn Quốc Toản, Director of the MARD’s Agro Processing and Market Development Department, says the ministry will closely observe the situation in COVID-19-affected markets to provide corresponding solutions. “We will collaborate with the Ministry of Industry and Trade, agencies and companies to closely monitor the price, supply and demand of essential agricultural goods in the domestic market to ensure food security in Việt Nam while still maintaining agricultural exports,” he said. The ministry will also focus on resolving technical barriers in agricultural trade, as well as expanding and diversifying markets through negotiations with trade partners.  Effects of COVID-19 see industrial production plummet The opening five months of the year have seen the Index of Industrial Production (IIP) grow annually by approximately 1%, the slowest pace recorded in many years due to the negative impacted caused by the novel coronavirus (COVID-19), according to the General Statistics Office (GSO). With the epidemic being successfully brought under control, the entire nation has entered a period where it is simultaneously both combating the epidemic and making every effort to revitalise the national economy with plenty of positive signs ahead with regard to industrial production activities.  In line with this positivity, the IIP surged by 11.2% in May in comparison with the previous month, despite suffering a 3.1% decrease in comparison with the same period from 2019. Indeed, the past five months have seen the IIP grow by an estimated annual amount of 1%, much lower than the 9.5% increase seen during the same period from last year. Most notably, the processing and manufacturing sector increased by 2.2%, contributing 2% to the general increase, while electricity production and distribution rose by 2.6%, therefore contributing 0.2%. In contrast, the mining industry dropped by 8.1%, leading to a 1.3% fall in the overall increase. The GSO stated that the complex developments of the COVID-19 pandemic globally have led to a shortage of input materials, subsequently hitting industrial production. Other key products that have followed this downward trend are beer, down 24.5%, automobiles, down 26.9%, motorbikes, down 15.6%, crude oil, down 13.7%, and liquefied petroleum gas, down 11.8%. Elsewhere, some industries are still recording fair growth such as phone components, monosodium glutamate MSG, and steel. The number of employees working in industrial enterprises as of May 1 grew by 0.9% from the previous month, a 1.7% decrease on-year, of which employees at state-owned enterprises fell by 1.9%, with non-state enterprises falling by 2.5%, and FDI enterprises by 1.3%. Air corridors could offer pathway to rejuvenate national tourism industry The New Straits Times recently published an article by author Zaidi Isham Ismail discussing the prospect of restoring Malaysia's tourism industry amid the COVID-19 pandemic. Notably, the author said that Malaysia could apply the form of "air travel" with ASEAN member states such as Singapore, Vietnam and Thailand in the near future. Without a doubt, COVID-19 had unleashed havoc all over the world and one of the worst affected sectors is the tourism and travel industry. However, a beacon of light had possibly shone on the industry with the advent of the travel "bubble." Some call it "travel corridors" while others name it "air bridges." The bubble or corridors denotes a safe or a protected perimeter between two travel destinations or countries or states already declared as green zones ready to receive tourists which is set to help the tourism sector recover. Already there are bubbles being mooted between Australia and New Zealand and between South Korea and 10 territories in China, the article said. Perhaps in Malaysia, the obvious and nearest travel bubble is with Singapore. Granted the situation in Singapore is extremely volatile right now but it only involves foreign workers while the rest of the population are relatively COVID-19 free. According to the author, perhaps the two countries could consider setting up their very own travel bubble. Subsequently, this concept could be expanded to the rest of ASEAN such as Vietnam and Thailand which are also headed towards green zone status. But will this travel bubble concept work? Ultimately for the initiative to work, the essential requirement is trust between countries. Safe travel corridors also require the cooperation of multi agencies. This includes the health ministries of both nations, the immigration, customs, airport authorities and the tourists themselves who must be honest in their health status backed by health certificates. Everybody must practise the standard operating procedures such as the social distancing, hand sanitisers and face masks. Participating partners must also have a standard operating procedures between them involving hotels, restaurants and tourism spots. The economies of nations are fledgling and the prospect of a COVID-19 vaccine is still far away, the author added. Vietnam Airlines gears up to open six new domestic routes National flag carrier Vietnam Airlines are poised to open six new domestic air routes throughout June, according to a representative from the airline on June 1. In line with the move, the Hai Phong-Da Lat and Hai Phong-Phu Quoc air routes will begin operation from June 12, with four round trips per week being held on Monday, Wednesday, Friday, and Sunday.  Elsewhere, air routes such as Hai Phong-Can Tho, Hai Phong-Buon Ma Thuot, and Vinh-Can Tho will start as of June 12 at a frequency of three round trips per week on Tuesday, Thursday, and Saturday. The Can Tho-Buon Ma Thuot route will operate with a frequency of four return flights per week on Monday, Tuesday, Thursday, and Saturday, beginning from June 22. The Vietnam Airlines representative stated that in order to mark the opening of a new route, the firm will be selling 6,666 air tickets at a price of only VND 66,000 for a one-way trip, excluding taxes and fees. Tickets will go on sale from June 6 to June 12 with departures lasting until December 31. Moreover, passengers will also be able to purchase special promotional tickets at a price of only VND99,000 for a one-way trip, excluding taxes and fees, with ticket validity and departure until July 31. This move comes following Vietnam Airlines opening five new domestic routes during May, including Ho Chi Minh City-Tuy Hoa, Hai Phong-Nha Trang, Vinh-Da Lat, Vinh-Buon Ma Thuot, and Thanh Hoa-Buon Ma Thuot. In an effort to ensure the safety of passengers and the wider community, Vietnam Airlines will be maintaining preventive measures against the novel coronavirus in line with regulations. Stimulus packages boost local consumption and tourism Ho Chi Minh City has recently completed a range of plans in order to deploy a series of stimulus schemes aimed at reviving the tourism industry and increasing local consumption in order to negate the negative impacted of the COVID-19 pandemic. In line with the plans, the Ho Chi Minh City Department of Industry and Trade will be hosting a scheme aimed at stimulating consumption demand, with the event taking place from July 2-5 at 19 Dao Trinh Nhat street in Thu Duc district.  The programme aims to strengthen connectivity between various production units and distributors whilst simultaneously showcasing the southern city’s key export products across 500 stalls at the event. Moreover, participating businesses will also be given the chance to launch an array of discount schemes aimed at promoting sales and establishing supply chains in an effort to support the introduction of agricultural products to distribution systems throughout the southern metropolis. The Ho Chi Minh City Department of Industry and Trade hosted a press conference to unveil its plans to run a 60 golden-day programme which is scheduled to take place between June 1 and July 30. The event will be part of the southern city’s trade promotion scheme for the year and aims to remove various difficulties that businesses may be facing following the impact of the COVID-19, while also helping to stimulate domestic consumption, along with restoring production and business activities in the post-pandemic period. During the event, a range of businesses are expected to put on several diverse promotional activities, with a maximum discount on the value of goods and services reaching up to 100%. Nguyen Phuong Dong, Deputy Director of Ho Chi Minh City Department of Industry and Trade, said the programme is anticipated to offer an ideal venue for firms to introduce their new products. Furthermore, it will also contribute to accelerating the city’s economic growth in the post-pandemic period, whilst offering firms a platform to join hands in order to carry out the action plan of "Vietnamese people prioritise using Vietnamese goods”. Disbursement of investment capital from State budget rises sharply in May Approximately VND31.1 trillion (US$1.33 billion) in investment capital sourced from the State budget was disbursed in May 2020, an increase of 17.5% over the same period in 2019, according to the General Statistics Office. In the January-May period, total investment capital from the State budget was estimated at VND116.3 trillion (US$4.99 billion), equivalent to 24.9% of the year’s target and up 15.6% over the same period last year. The disbursement rate of investment capital from the State budget in May and in the first five months of this year reached the highest levels in the 2016-2020 period. The investment capital has soared sharply in the context that the COVID-19 pandemic has been well under control while investment in basic construction has returned to normal and the progress of major construction projects is being accelerated. Landmark Holding to be delisted from HSX over financial troubles Developer Landmark Holding is neck-deep in financial troubles and is plagued by uncertainties around its notorious Manhattan Tower project which has been delayed for almost 10 years now – and has drawn lawsuits from hundreds of homebuyers. Landmark Holding JSC (code: LMH), formerly known as Thang Long International JSC specialising in petrochemical products and real estate, has just sent its unaudited financial statement for 2019 to the Ho Chi Minh City Stock Exchange (HSX). However, Viet Values Audit and Consulting Co., Ltd. refused to confirm the accuracy of items in the statement, including VND53.5 billion($2.3 million) in short-term revenue from clients, VND214.3 billion ($9.3 million) in advance payments to vendors, VND20.7 billion ($0.9 million) in short-term receivables, and VND134.8 billion ($5.8 million) in advance payment from buyers, among others. The accuracy of these items will impact other items in the accounting balance sheet and business results. Additionally, Viet Values highlighted that there is no contract to prove the accuracy of VND136.4 billion ($5.9 million) in receivables and VND31.1 billion ($1.3 million) in the balance of Landmark Holding (as of the end of 2019), which are unsecured loans without any collaterals or guarantee commitment of a third party. Notably, these questionable items have existed in the financial statement 2018 with bigger amounts. Thus, if these items in the unaudited financial statement of Landmark Holding are not made-up, the heads of the company should be able to explain or make a comment after the refusal of Viet Values, to set investors and shareholders’ mind at rest, as well as change the audit firm's decision. However, so far the company has remained, and LMH is being forced to delist its stock. In fact, business results in the fourth quarter and the whole of 2019 of Landmark Holding were quite a lot worse than in the previous year. At the end of 2019, the LMH stock dropped for the 25th consecutive session to VND2,000 (8 US cents) from VND12,200 (53 US cents) last December. Moreover, the company's first-quarter business results showed that revenue was much less than its expenses, resulting in a VND7 billion ($304,000) loss. Landmark Holding was listed on HSX in October 2018 with 23 million shares initially, which was raised to 25.6 million since then. However, over the last 19 months, the internal shareholders of the company purchased 4.1 million shares only and sold approximately 7.6 million ones. Besides, numerous big shareholders have also divested their holdings in LMH significantly, like Nguyen Thanh Tung, Luong Quan Vinh, and Tran Thanh Tung. This confirmed their lack of faith in LMH’s financial status. In addition to financial troubles, hundreds of homebuyers who paid a lot of money to buy apartments of at Tower (21 Le Van Luong, Hanoi’s Thanh Xuan district), are dogging Landmark Holding for a refund, while the owner of the project – Ba Dinh Construction Consultancy-Investment JSC (Ba Dinh JSC) – has been sued by Global Petroleum Commercial Bank (GPBank) to recover the loans of VND290 billion ($12.6 million) (as of April 2019 only). Entering the real estate sector several years ago, Landmark Holding seems unable to spot reputable and reliable projects and partners, which contributed to its present catastrophic business results. If it cannot quickly resolve and overcome these financial difficulties, the developer could very well go bankrupt, leaving investors, homebuyers, and shareholders empty-handed. SK Group acquires 25 per cent of Imexpharm South Korean conglomerate SK Group has become a large shareholder of Imexpharm (IMP), adding to its considerable portfolio of shares in Vingroup, Masan, and PV Oil. On May 29, SK Investment III, a subsidiary of South Korea’s third-largest conglomerate SK Group, received 12.32 million shares, equivalent to 24.9 per cent of Imexpharm Corporation (code: IMP). The transaction was carried out through Vietnam Securities Depository (VSD) at an undisclosed value. However, at the end of last week, the price of IMP shares was around VND54,000 ($2.35), so if the transaction was made at market price, it would be around VND665 billion ($28.9 million). Most of the shares (11.3 million) were acquired from Dragon Capital Group, while the rest came from CAM Vietnam Mother Fund, Kingsmead, and Mirae Asset. The latest investment is quite modest compared to the two previous transactions where SK Investment Vina I spent $470 million on 9.4 per cent of Masan Group, and SK Investment Vina II poured $1 billion into acquiring 6 per cent of Vingroup. Additionally, another SK Group subsidiary, SK Energy, also holds 5.2 per cent of PV Oil. At Imexpharm, foreign investors now hold approximately 49 per cent of the total shares. Other big shareholders are VinaCapital (7 per cent), KWE Beteiligungen AG (14.3 per cent), and Vietnam Pharmaceutical JSC – Vinapharm (22.9 per cent). At present, numerous big pharmaceutical firms have raised their foreign ownership limits to 49 per cent, enabling foreign companies to raise ownership, the way Taisho Pharmaceutical boosted its interest in DHG Pharmaceutical JSC (DHG) to 51 per cent, Abbot in Domesco Medical Import-Export JSC (DMC) to 51.7 per cent, or Stada in Pymepharco (PME) to 62 per cent. Life Lab and eDoctor sign strategic partnership SDG Life (Life Lab) and eDoctor have signed a strategic partnership, marking the beginning of a fruitful, long-term co-operation. Accordingly, Life Lab has become an official partner of eDoctor in doing medical tests for the latter’s customers, and will also act as a consultant for eDoctor in developing new healthcare products and services packages. Duong Ngoc Cuong, general director of Life Lab, said that, “With the two sides’ capacity and growth potential, the co-operation will produce fruitful results. It will bring good healthcare services for customers.” Established in 2019, Life Lab is a high-tech and professional testing centre. Meanwhile, Vietnam-based eDoctor is a mobile app where millions of Vietnamese people can easily access healthcare information and connect with doctors, hospitals, and pharmacies. Soya Garden chain closes most stores in Ho Chi Minh City Half of Soya Garden shops in Ho Chi Minh City have been closed after the pandemic, while the remainder only see a handful of customers a day. Recently, Soya Garden is said to have closed most of its shops in Ho Chi Minh City to stop losing and keep only three at golden land plots with enough customers to operate. In fact, 10 of the 13 Soya Garden shops located in suburban districts have been closed. Elsewhere, others are still open, including the flagship one on District 1's Ly Tu Trong Street, the one on Tan Binh district's Le Van Sy Street, and the one on Binh Thanh district's Vu Huy Tan Street, while the one on Nguyen Dinh Chieu (also the representative office of Soya in Ho Chi Minh City) is open without serving. Six of the shops closed are at 35 Phan Dang Luu Street (the first Soya Garden store in the city), three ones in Go Vap district, and two ones in Tan Binh and Tan Phu districts. Moreover, on Facebook, a friend of Hoang Anh Tuan, the CEO of this chain, is offering to lease the house at 27B Nguyen Dinh Chieu Street, District 1, where the first floor is home to a Soya Garden, above which is the headquarters of the chain. Meanwhile, the fan page of Soya Garden has stopped posting anything since May 11, and its website has been closed all of a sudden.  Soya Garden has also been shutting down stores in Hanoi. Some owners of franchised shops in Hanoi are offering to transfer their stores. At the end of January, Soya Garden announced having 45 shops including 29 in Hanoi, 13 in Ho Chi Minh City, two in Haiphong, and one in Nha Trang. In last September, the chain inaugurated the 50th store at District 1's Ly Tu Trong Street. This means the chain closed five shops in the few months ending 2019.  After calling for investment on the TV show Shark Tank 2018, Soya Garden received a total of VND100 billion ($4.35 million) from EGroup of Shark Nguyen Ngoc Thuy – chairman of Apax Holdings JSC and EGroup – and has massively expanded for the last two years. The CEO of Soya Garden originally targeted having 100 stores in 2019 and 300 ones in 2020 and setting foot in South Korea, Thailand, and Japan in the next years to make Soya Garden drinks as popular as coffee or bubble tea, which has come to naught after the global health crisis.  January-May foreign investment inflows reach $13.9 billion, promising strong rebound Although the total foreign investment capital in the first five months of this year reported a decrease of 17 per cent on-year, however, capital inflows are expected to increase once again thanks to drastic government measures to grab opportunities from the global wave of investment relocation. According to statistics published by the Foreign Investment Agency (FIA) under the Ministry of Planning and Investment, foreign investors poured $13.89 billion in total into Vietnam during January-May, signifying a decrease of 17 per cent on-year due to the impact of the COVID-19 pandemic. The period saw 1,212 newly-registered projects with a total registered capital of $7.44 billion, down 11.1 per cent in the number of projects but up 15.2 per cent in capital value. Meanwhile, 436 existing projects were allowed to raise investment by more than $3.45 billion, up 31.4 per cent on-year. According to the agency, foreign-invested capital disbursement reached $6.7 billion in the five months, equivalent to 91.8 per cent of last year’s corresponding period. Foreign investors pledged to pour capital into 18 sectors, in which manufacturing and processing took the lead with nearly $6.87 billion, accounting for 73.6 per cent of the total capital. It was followed by power production and distribution ($3.92 billion); real estate ($800 million); and wholesale and retail ($776 million). Among the 54 localities receiving foreign investment in the period, the southern province of Bac Lieu ranked at the top with $4 billion. The southern province of Ba Ria-Vung Tau came second with $1.93 billion and Ho Chi Minh City placed third with $1.6 billion. Singapore is still the largest foreign investor of Vietnam with the total capital of $5.3 billion, followed by Thailand with $1.46 billion, China with $1.27 billion, and Japan with $1.26 billion. At a recent meeting hosted by the prime minister, the representatives of the Ministry of Planning and Investment (MPI) and localities shared that after studying investment opportunities in the country, foreign investors found Vietnam a safe and promising investment destination and a likely candidate for their diversification of supply sources. The PM also agreed to establish a special working group headed by the Minister of Planning and Investment to catch this wave of new investment. The special working group was established to build competitive investment attraction policies to tap into the wave of investment going into this global strategic relocation. The policies to be created include incentives on tariffs, access to land, as well as solutions to prevent further disruptions to the supply chain and a lack of human resources. In addition, as a key priority for investors is stability and legal consistency, the special working group will complete the relevant legal framework. PV Power to take a dive into solar power PV Power plans to establish a member company to set foot in the renewable energy sector. At first, the group will construct rooftop solar power systems on the buildings and factories in the holding of PetroVietnam. According to the representative of PV Power, the company has distinct advantages due to its experience in management, operation, as well as partner relationship with EVN. Besides, the company has the available infrastructure to help connectivity. In the first year, the firm expects to generate 50MW of solar power. Although this figure is rather small compared to other projects in the power industry, however, with its advantages in infrastructure and human resources, numerous businesses expressed intentions to co-operate with PV Power. According to PV Power's recently published business statement, its net revenue in the first quarter decreased by 6 per cent to VND7.97 trillion ($346.5 million) and its after-tax profit saw a plunge by 45 per cent to VND505 billion ($21.96 million). The company said that this bleak result is still within its plans and was mainly due to a plunge in the capacity of its two hydropower plants. Besides, it has yet to add the profit from Nhon Trach 2 thermal power plant. Regarding other projects invested by PV Power, Nhon Trach 1 thermal power plant has seen decreasing gas sources and PV Gas plans to take gas from Sao Vang Dai Nguyet field to offset the lack. Besides, PV Power is considering using liquefied natural gas (LNG) as an alternative. In addition, PV Power completed the feasibility study for the implementation of large-scale projects, including Nhon Trach 3 and 4 thermal power plants, and has mobilised capital to develop projects located in Ong Keo Industrial Zone in the southern province of Dong Nai. According to information published by PV Power, the consultancy agency of Nhon Trach 3 and 4 – Power Engineering Consulting JSC 2 – completed the feasibility study. PV Power will submit the basic report to the Ministry of Industry and Trade for approval and send a document to EVN to discuss grid connection. Besides, the company will work with Electric Power Trading Company and PV Gas to negotiate power and gas purchase agreements for the two projects. Regarding the investment capital, along with loans from banks and credit funds, as well as equity, PV Power announced that the Thai investor B.Grimm Power expressed intention to invest in these two projects, as part of their MoU on investment co-operation. Việt Nam’s agricultural exports decline in May due to COVID-19 Exports and imports of agricultural goods saw a decline in the first five months of 2020 due to the negative impacts of the COVID-19 pandemic, according to the Ministry of Agriculture and Rural Development (MARD)’s monthly report last week. Export value in the first five months of 2020 saw a decline of 4.1 per cent year-on-year and was valued at US$15.5 billion. Coffee, rice and vegetables were among the commodities with the strongest export growth, whereas rubber, tea and pepper saw a sharp fall. China is Việt Nam’s largest exporting market of agricultural products, with export turnover at $3.7 billion, a 15.5 per cent drop in value, closely followed by the US and the EU, reaching $3.4 billion and $1.6 billion, respectively. Nguyễn Quốc Toản, Director of the MARD’s Agro Processing and Market Development Department, says the ministry will closely observe the situation in COVID-19-affected markets to provide corresponding solutions. “We will collaborate with the Ministry of Industry and Trade, agencies and companies to closely monitor the price, supply and demand of essential agricultural goods in the domestic market to ensure food security in Việt Nam while still maintaining agricultural exports,” he said. The ministry will also focus on resolving technical barriers in agricultural trade, as well as expanding and diversifying markets through negotiations with trade partners. Foreign investors eye moving production bases to Thailand Many foreign investors are looking to move their production base to Thailand, according to Kriangkrai Thianukul, vice president of the Federation of Thai Industries (FTI). The main reason for their interest in Thailand is the COVID-19 pandemic, which caused manufacturing facilities in China to shut down and affected the supply chain of the industrial sector, he said. Many companies are planning to move out of China to reduce future risk and are eyeing countries in Southeast Asia, he added. He further noted that Thailand is among the top choices as the country has several seaports to facilitate logistics and the geographical location is at the centre of the region. Thailand also has basic infrastructure for high-tech industries as well as cheap labour, he said. The fact that Thailand has handled the pandemic well also proves its ability in dealing with a crisis and helps strengthen investors’ confidence, he explained. As Asian supply chains reshuffle in the wake of the pandemic, the Thai government is focusing its efforts to attract foreign investors in the medical devices sector, a promising industry in light of the health crisis. Thailand’s Board of Investment (BoI) aims to set up joint ventures or convince foreign firms to move their manufacturing base for medical devices to the country. Sonklin Ploymee, executive director of industrial linkage development at BoI, said the group is focusing on developing the country's subcontracting sector to serve new targeted industries in the future. Initially, the BoI will focus on the aerospace, medical devices, electric vehicle, smart electronics and the railway system sectors, she said. The division has successfully conducted several programmes to assist foreign assemblers and manufacturers with sourcing high-quality parts and components from Thai small and medium-sized enterprises. The BoI plans to hold Subcon Thailand, ASEAN's largest international industrial subcontracting event, between September 23 – 26 in Bangkok to facilitate business matching and create a targeted 12 billion THB (nearly 400 million USD) in value from 8,000 business matches./. Thai rice exports facing price disadvantage The price of Thai rice is higher than that of competitors due to limited supply and the strengthening of the baht, which could hurt exports, the Thai Rice Exporters Association (TREA) said. TREA President Charoen Laothammathat cited data of the Customs Department that the country exported 2.11 million tonnes of rice worth 43 billion baht (1.38 billion USD), down 32.1 percent and 15.7 percent year-on-year respectively during the first four months of 2020. The figure during the first four months of 2019 was 3.1 million tonnes worth 51 billion baht. In April alone, Thailand exported 643,852 tonnes of rice, earning 14.55 billion baht, up 23.7 percent and 32.7 percent respectively compared to the previous month as countries in America, Africa and Asia imported more rice due to uncertainty following the COVID-19 outbreak. The association expected the export of rice in May to drop to approximately 500,000 tonnes, as rice importing countries were delaying orders, while competitors Vietnam, India and Pakistan had returned to the market. In addition, the price of Thai rice was higher than that of competitors due to limited supply and strengthening of the baht, he noted. He explained that the price of 5 percent white rice in Thailand was 501 USD per tonne, higher than that of competitors by 30 USD to 130 USD. In 2019, Thailand shipped 7.58 million tonnes of rice abroad, raking in 131 billion baht (over 4 billion USD), down 32 percent in volume and 25 percent in value compared to the previous year./. THACO exports first semi-trailers to US Truong Hai Auto Corporation, known as THACO, exported its first 36 semi-trailers to the US on June 1. In order to make its inroads into the US market, THACO has conducted surveys and signed a memorandum of understanding on distributing semi-trailers in the US market with PITTS Enterprises Company - one of 15 major semi-trailers manufacturers in North America. Under the contract, these 36 semi-trailers are the first of the 69-unit batch that will be exported to the US through PITTS Enterprises. According to THACO, the semi-trailers are manufactured at THACO Special Vehicles Manufacturing Limited Company, the firm that specialises in manufacturing high-quality semi-trailers and special vehicles for local and foreign markets. In the coming time, PITTS Enterprises will continue to cooperate with THACO to design, develop and manufacture new products to meet the demand of customers and expand the distribution in the US market. THACO said it will hand over the remaining 33 semi-trailers to PITTS Enterprises in late June, and continue to fulfill its production commitment signed by the two sides in 2020. It will also boost exports to Japan, Australia and ASEAN countries. The firm expects to export more than 1,600 vehicles of all kinds with a total value of 50 million USD this year. Its successful export to the US market proves that THACO has appropriate strategies to join deeper in the global value chain./.  Indonesia to offer nine toll road projects in 2020 The Indonesian Ministry of Public Works and Housing (PUPR) said it will offer nine toll road projects during 2020. Minister Basuki Hadimuljono said this year, the Indonesian government prepared an investment of 395 trillion Rp (26.33 billion USD) for toll road projects across the archipelago. “Although the finance ministry saved a budget of 44 trillion Rp, no activities were canceled,” he told reporters through a virtual press conference after a limited Cabinet meeting on the National Strategic Projects led by President Joko Widodo on May 28. Hadimuljono reported that some of the toll roads will be inaugurated this year, including Banda Aceh – Sigli with a length of 14 kilometers (km), Pekanbaru – Dumai 131 km, Manado 21 km, and Balikpapan – Samarinda 33 km. Then, part of Makassar toll road, Cibitung – Cilincing, and Kriyan toll road in East Java will be opened at the end of the year. The head of Indonesia’ Toll Road Regulatory Agency, Danang Parikesit, added that six of the nine projects to be auctioned were proposals or initiatives from business entities. They will have a total investment of 135.60 trillion Rp and a total length of over 461km. The Indonesian government set a target of building 3,000 km of new toll roads across the country in the next five years. President Joko Widodo said during his first term, the country has build 720 km of toll roads. “In the next five years, we hope that we already have 5,000 km of toll roads. Therefore, we are still focusing on infrastructure development in addition to human resource development,“ he stated not long ago./. Good funding urged for appraisal of North-South express railway’s pre-feasibility study Deputy Prime Minister Trinh Dinh Dung has ordered relevant ministries to allocate sufficient funding for the appraisal of the pre-feasibility study of the North-South high-speed railway project. The Ministry of Transport was tasked to promptly work with the Ministry of Planning and Investment and the Ministry of Finance to provide adequate funding for the assessment of the study in accordance with regulations. The study is being assessed by a state appraisal council exclusively set up for the project last year. The Ministry of Transport’s Party Civil Affairs Committee was requested to set a timeline for the submission of a plan on construction of the North-South high-speed railway to the Politburo, which should be reported to the Prime Minister before June 10. The railway is designed to have a total length of about 1,560 km, running along the North-South corridor through 20 cities and provinces to connect Hanoi and Ho Chi Minh City. Of the total, the 14-km section in Hanoi shares the infrastructure with the Hanoi urban railway No.1 (from Hanoi station to Ngoc Hoi station), and the remaining connects Ngoc Hoi station to Thu Thiem station, with 27 stations, five depots, and 42 infrastructure maintenance facilities. It is designed for passenger trains to run with a maximum speed of 350km per hour. The first phase of the project has a total investment of 561.6 trillion VND (about 24.71 billion USD), while the second costs 772.6 trillion VND. The whole project is scheduled to be completed in 2050./. Agricultural imports, exports fall due to COVID-19 Exports and imports of agricultural goods saw a decline in the first five months of 2020 due to the negative impacts of the COVID-19 pandemic, according to the Ministry of Agriculture and Rural Development (MARD)’s monthly report last week. Of which, export value in the period dropped 4.1 percent year-on-year to 15.5 billion USD. Coffee, rice and vegetables were among the commodities with the strongest export growth, whereas rubber, tea and pepper saw a sharp fall. China is Vietnam’s largest exporting market of agricultural products, with export turnover of 3.7 billion USD, a 15.5 percent drop in value. It was closely followed by the US and the EU, reaching 3.4 billion USD and 1.6 billion USD, respectively. Nguyen Quoc Toan, Director of the MARD’s Agro Processing and Market Development Department, says the ministry will closely observe the situation in COVID-19-affected markets to provide corresponding solutions. “We will collaborate with the Ministry of Industry and Trade, agencies and companies to closely monitor the price, supply and demand of essential agricultural goods in the domestic market to ensure food security in Vietnam while still maintaining agricultural exports,” he said. The ministry will also focus on resolving technical barriers in agricultural trade, as well as expanding and diversifying markets through negotiations with trade partners./. Workshop looks into bottlenecks in post-COVID-19 development The Central Institute for Economic Management (CIEM) held a workshop in Hanoi on June 1 to look into bottlenecks in Vietnam’s development post-COVID-19. CIEM Director Tran Thi Hong Minh said Vietnam’s economy was greatly affected by the coronavirus outbreak in the opening months of 2020. The country has, however, basically brought the pandemic under control and has now begun its economic recovery. Now is the time to focus on bottlenecks in economic development to identify solutions, she said, noting that such bottlenecks existed prior to COVID-19 breaking out. Nguyen Anh Duong, head of the CIEM’s division for macro-economy, said international organisations have downgraded global growth projections, including for Vietnam. Many forecast that the pandemic’s impact on the global economy could be even more serious than that of the global financial crisis and may linger for some time. He noted that Vietnam’s economic growth slowed in the first quarter compared to the same period in 2010-2019. Exports and the trade balance remained positive in the opening months but will be hard to maintain after April. Efforts by domestic businesses are not sufficient in the current context, and it is necessary to adopt a friendly approach to FDI, he believes. Looking at bottlenecks in post-COVID-19 development, Duong pointed to those that are relevant to institutional quality, e-Government building, the use of public resources, and inclusive and sustainable growth. He stressed matters relating to the treatment of investors, noting that they are not simply eliminating unnecessary procedures. To effectively channel FDI into targeted sectors, Vietnam must issue standards on investment attraction. Meanwhile, Dau Anh Tuan, Head of the Legal Department at the Vietnam Chamber of Commerce and Industry (VCCI), underlined the need to push ahead with substantive administrative reform. He said the country has made great strides forward in administrative reform but has also encountered more difficulties, such as in dispute settlement and asset protection. Reform must therefore be carried out more firmly and in a way that creates optimal conditions for businesses and does not simply tackle the difficulties they face./. Vietnam has ‘golden opportunity’ to reactivate economy: official Vietnam now has a “golden opportunity” to reactivate its economy earlier than many other countries, Minister-Chairman of the Government Office Mai Tien Dung said on June 2. At the Government’s regular press conference in Hanoi, he cited the Government’s assessment that there were many bright spots in the economy over the last five months. Exports declined, but not strongly compared to the same period last year, and a trade surplus of 1.9 billion USD was still recorded. Only tourism revenue and the number of international arrivals experienced sharp falls. The macro-economy remains stable, the monetary policy stays flexible while the attraction of foreign capital along with businesses and people’s absorption of capital have also proved effective, Dung noted. He highlighted the Government’s viewpoint that ministries and sectors must push ahead with the COVID-19 fight and adamantly prevent the return of this pandemic so as to focus every resource on production recovery and economic development. The official also quoted the Ministry of Planning and Investment as reporting that 5,056 businesses resumed operations in May, up 32.7 percent month on month. Total retail sales of goods and service revenue also grew 26.9 percent from April, the index of industrial production (IIP) 11.2 percent, and exports 5.2 percent. These figures showed the economy has begun to return to normal after the social distancing period, he said. However, the minister noted, the report also pointed out that big difficulties still lie ahead. Revenue from trading activities and services last month soared by 26.9 percent against April but dropped 4.8 percent year on year. The five-month retail sales of goods and service revenue shrank 3.9 percent from the same period of 2019. Meanwhile, the IIP in May still fell 3.1 percent from a year earlier, and the five-month figure rose by only 1 percent year on year – the slowest pace in many years. According to the General Statistics Office, as the COVID-19 situation remains complex around the world, supply chains of input materials will continue to be interrupted, and so will industrial production./. Vietnam-China trade conference focuses on building materials, décor An online trade conference between Vietnam and China was held in Hanoi on June 2, focusing on construction materials and interior and exterior décor. Head of the Trade Promotion Agency Vu Ba Phu said this was the second conference jointly held by the Agency and the Department of Commerce in China’s Guangxi Zhuang Autonomous Region (GZAR) over the past two months, as part of a trade promotion agreement signed by the two offices and 10 northern Vietnamese localities in June 2019. The conference aimed to realise a common view held by Minister of Industry and Trade Tran Tuan Anh and Secretary of the GZAR’s Party Committee Lu Xishe on intensifying measures and cooperation between Guangxi and Vietnamese localities to resume trade and economic activities. The production and trade of construction materials and interior and exterior décor depend very much on the real estate market. Real estate in both Vietnam and China, however, has been downbeat since virtually the beginning of the year, especially since COVID-19 broke out. Enterprises in the two countries operating in the field should therefore intensify their cooperation and adopt methodical investment strategies on finance and technology to anticipate new opportunities when the pandemic is defeated. Jiang Liansheng, Director of the GZAR’s Department of Commerce, said the two sides have organised numerous fairs on construction materials and interior and exterior décor. Two-way trade of household appliances, building materials, décor, and sanitary equipment rose from 24.78 billion USD in 2017 to 39.73 billion USD in 2019, of which turnover of building materials and décor increased from 7.16 billion USD to 14.76 billion USD, for average annual growth of 53.1 percent. Phu stressed that his agency is willing to facilitate links between enterprises from Vietnam and Guangxi./. VNN