VIETNAM'S
BUSINESS NEWS HEADLINES JULY 7
02:37
SCIC sells shares at Khanh Hoa Seafood Export JSC
The State Capital Investment Corporation (SCIC) will sell its shares at the Khanh Hoa Seafood Export Joint Stock Company on July 22, 2020.
According to
the notice issued by SCIC on June 30, this corporation will offer 132,200
common shares in blocks at the July auction, representing 8.96 per cent of
the total shares at the Khanh Hoa Seafood Export Joint Stock Company.
Domestic and
foreign investors can participate in the auction with an initial share price
of VND32,200 (US$1.38).
The
investors can register to join this auction from June 30 until July 21 at the
BOS Securities Joint Stock Company.
The Khanh
Hoa Seafood Export Joint Stock Company's core business activities include
processing and preservation of seafood products, exploitation of fishery
products at sea and inland, and wholesale of food products.
The
company’s shares with code KSE traded on the Unlisted Public Company Market
(UPCoM) from August 11, 2017.
At present,
SCIC holds 8.96 per cent of the Khanh Hoa Seafood Export Joint Stock Company,
the second largest shareholder after Tran Thi Tinh which has 134,800 shares
equivalent to 9.13 per cent of the company’s charter capital. This company
has no foreign shareholders.
This seafood
company’s total profit after tax in 2019 reached more than VND6 billion, an
increase of 1.82 per cent over the previous year.
On the stock
market, KSE shares traded at VND30,900 per cent share on June 30. KSE's
market capitalisation is VND35.7 billion./.
June CPI in Ho Chi Minh City
up 0.66 percent
The
June CPI in Ho Chi Minh City was up 0.66 percent from last month, and up 2.1
percent from the same month last year.
Transport
services prices surged 6.92 percent month-on-month due to petrol prices being
adjusted up twice on May 28 and June 12.
The
prices of food and foodstuff group rose 0.95 percent, driven by high pork
prices. The group of restaurants and catering services also saw an increase
of 0.53 percent.
Meanwhile,
the prices of beverage and tobacco was down 0.15 percent, the group of
housing, utilities, fuels and construction materials saw a decrease of 0.69
percent.
The gold
price in June picked up 0.56 percent from May and 31.77 percent from the same
month last year. The USD/VND exchange rate dropped 0.61 percent on a monthly
basis and down 0.32 percent year on year.
The
average CPI in the first half of this year was up 3.48 percent from
the same period last year./.
Footwear sector to improve
supply chain to take advantage of EVFTA
Vietnam’s
leather and footwear industry should improve its supply chain performance to
take advantage of the milestone trade deal that the country has signed with
the EU and to recover from the effects of the COVID-19 crisis, speakers said
at a recent international footwear conference.
Diep Thanh
Kiet, deputy chairman of the Vietnam Leather, Footwear and Handbag
Association (Lefaso), said the domestic footwear industry has had strong
performance growth in recent years with increased consumer awareness about
branded products.
Vietnam, the
second-largest footwear exporter in the world, has signed free trade
agreements with a number of countries such as the Republic of Korea, Russia,
Kazakhstan and Belarus, among others.
In addition
to the Europe-Vietnam Free Trade Agreement (EVFTA), the footwear and handbag
industry can benefit from many other FTAs signed by Vietnam.
However, the
supply and distribution chains of the industry have suffered during the
COVID-19 pandemic.
“The
pandemic has left thousands of labourers in the sector jobless since orders
have been either cancelled or delayed by business partners, leading to
significant fall in revenues,” Kiet said.
Some
businesses have reported unsold inventories piling up and are not sure if
stocks will clear after the EU reopens.
“Supply
chains as well as trade policies will play a major role in the recovery,” he
noted.
Beginning in
2022, the industry’s average growth rate is expected to reach 10 per cent per
year, he said.
Kiet said
the signing of EVFTA would enhance trade and investment in the footwear
industry and that businesses would enjoy enormous tax incentives.
Thirty-seven
percent of Vietnam’s total footwear export volume to the EU will immediately
enjoy zero percent tariff, while the remainder will see tariffs fall
gradually from the current average of 12.5 percent to zero following roadmaps
of three to seven years.
Vietnam’s
biggest competitor in the industry is China. Its footwear products will enjoy
a tax difference of between 3.5 to 4.2 percent when exported to the EU,
creating a huge competitive advantage, experts said.
The EU also
offers unilateral incentives for a large number of goods originating from
Vietnam under the Generalised System of Preferences (GSP), which will help
Vietnam’s footwear become more competitive than its rival Chinese products in
the EU market.
Many foreign
footwear producers have shifted their businesses from China to Vietnam to
benefit from the EVFTA.
Although the
footwear industry has several advantages, its development still faces
challenges such as trade protectionism, rising labour costs and low labour
productivity, and lack of application of advanced technology.
According to
the Import-Export Department under the Ministry of Industry and Trade, the
ministry had recently signed a circular about rules of origin in the EVFTA.
The circular
will come into force on August 1, the day the trade deal takes effect.
With five
chapters and 42 articles, the circular is an important legal basis for
granting certificates of origin (C/O) for goods exported to the EU to enjoy
preferential tariffs provided by the trade deal, the department said.
The early
issuance of the circular on rules of origin, just a week after the National
Assembly approved the trade deal, was part of the ministry’s action plan to
improve the domestic legal framework to implement the EVFTA.
Compared to
other trade deals of which Vietnam is a member, the EVFTA’s rules of origin
have more new and complicated provisions.
The circular
is necessary for Vietnamese footwear firms to be able to take advantage of
preferential tariffs from the first day the trade deal comes into force,”
according to the department.
The ministry
said that footwear enterprises must study the rules of origin carefully to
have a proper understanding.
Each year,
Vietnam posts nearly 19 billion USD from footwear exports, with sports shoes
holding a big proportion in the sector’s total export value.
Vietnam’s
footwear and bag exports reached 22 billion USD last year, an increase of 12
percent compared to 2018.
According to
a report assessing the implications of the EVFTA from the Ministry of
Planning and Investment, EVFTA ratification will increase footwear exports to
the EU. The sector is expected to see a doubling of growth rate in exports to
the EU by 2025, with total export value of footwear jumping by around 34
percent and that of the whole sector by 31.8 percent.
After eight
years of negotiation, the EVFTA was signed on June 30 last year in Hanoi. The
European Council passed the trade deal on March 30 and the Vietnamese
National Assembly approved the trade deal on June 8./.
Retail-service revenue
increases 5.3 percent in June
Retail and
service revenue amounted to some 2.38 quadrillion VND (103 billion USD) in
June, up 6.2 percent on month and 5.3 percent on year.
However,
between January and June, the figure saw an annual decrease of 0.8 percent.
Also in the
period, the retail sector earned about 1.89 quadrillion VND, an annual
increase of 3.4 percent. The rise was attributable to abundant supply of
goods and thriving online shopping, particularly during the COVID-19 social
distancing period.
By contrast,
the accommodation and catering services earned just 234.7 trillion VND, down
18.1 percent against the same period last year.
The tourism
revenue also followed suit with an annual reduction of 53.2 percent. In the
first half, the sector reeled in just about 10.3 trillion VND due to a hiatus
in welcoming foreign visitors to control the spread of COVID-19. Meanwhile,
the summer vacation of students is yet to arrive, resulting in a less vibrant
domestic travel market./.
EVN to accept payment for
power bills via QR code
Vietnam
Electricity (EVN) is working with commercial banks and intermediary payment
services institutions to offer QR code payments for power bills.
Each
customer would have a QR Code. EVN has said it expects agreements with banks
and intermediary payment services institutions would be completed by the end
of August. In September, EVN plans to announce the list of institutions which
can provide QR code payment services for power bills.
Nguyen Quoc
Dung, head of EVN’s Business Department, said the move to implement QR code
payments was in response to Prime Minister Nguyen Xuan Phuc's directive to
promote a cashless society.
This would
also help improve labour productivity and management efficiency, Dung said.
Statistics
of VNPAY-QR showed the number of points of sales accepting QR code payments
increased from 20,000 to 70,000 during the past year./.
More than 75 tonnes of lychee
sold via MoMo
More than 75
tonnes of lychee were sold via the e-wallet MoMo in the past 20 days as part
of the programme 'Supporting Vietnamese Agricultural Products'.
According to
the firm, the first season of the programme with Saigon Co.op got better
results than expected.
Nguyen Ba
Diep, vice chairman and co-founder of MoMo said: “We first expected to sell
about 20 tonnes of lychee in HCM City. Then we sold 17.5 tonnes on the first
day and decided to sell in Ha Noi too.”
“The sale
has opened a new direction for agricultural consumption in the 4.0 era,"
he added.
According to
statistics from Saigon Co.op, lychee sold through MoMo has accounted for 20
per cent of total lychee sales in Saigon Co.op this year.
Do Quoc Huy,
Marketing Director of Saigon Co.op, said: "The programme will open up
more opportunities for other agricultural products in the future."
Diep from
Momo told Viet Nam News: “Farmers are often vulnerable in their agriculture
production due to weather and price changes. If we can help sell their
products from the beginning, it will help them be more proactive and have a
more stable source of income and they will be eager to cultivate more.”
Diep said
selling local agricultural products on the digital platform brought a new
buying experience for modern consumers.
“Saigon
Co.op is a trusted buying destination while MoMo, with more than 20 million
users, has helped the programme create a large-scale buying of the
products," he said.
Diep also
welcomed the use of MoMo as a platform for other agriculture products.
The sales of
the programme’s agricultural products reached more than VND2.2 billion (US$95,300)
and they also collected more than VND86 million of donations to school the
farmers' children./.
Japanese-imported pork sells
well despite high prices
Japanese-imported
pork products are proving popular in the Vietnamese market despite costing
4-5 times more than local products.
Over the
past six months, African Swine Fever has ravaged many localities in Vietnam,
affecting local pork supply. At markets and supermarkets in Vietnam, pork
prices range between VND150,000-320,000 (USD6.52-13.91) per kilo, depending
on different kinds.
In the first
five months of this year, Vietnam imported more than 70,000 tonnes of pork
from abroad.
Most
imported pork products are cheaper than local alternatives. However,
Japanese-imported pork products are around 4-5 times higher than domestic
options.
At many
shops, a kilo of Japanese-originated pork is priced at between VND950,000-1.1
million (USD41.32-47.82) per kilo, depending on different kinds.
The majority
of Japanese-imported pork is belly parts.
Hoang Thi
Chung, who works at a shop which specialises in selling Japanese pork, said
that her shop has been supplying this kind of meat for nearly one year. Each
day, the shop sells around 40-50 kilos.
Bui Manh
Tuan, a Japanese pork trader, said that the product is even sold better than
Spain’s Iberico pork. Every day, he can receive online orders of nearly 100
kilos in total with most of the customers from HCM City.
The Japanese
pork is often cut into small pieces of around 250-300 grammes for customers
to buy conveniently.
Vietnam has
also imported a large number of pigs from Thailand to increase the number of
livestock and domestic supply.
With these
measures, the country is expected to ensure pork demand in the local market
by the end of the third quarter of this year./.
Kido Group blasts back on
local confectionery scene
Local
manufacturers are upping the ante in Vietnam’s lucrative snack and
confectionery market to gain the market share from foreign brands.
Confectionary
specialists KIDO Group (KDC) recently announced its comeback to the market
five years after selling its snack business to Mondelez International. The
move is part of KDC’s strategy to resurrect its core business and develop
local brands for Vietnamese people.
The company
will launch its new snack and brand confectionery brand Kingdom in the third
quarter of 2020. Tran Le Nguyen, vice chair and CEO of KDC, said that the
company will change its development strategy for this comeback. Instead of
diversifying its product portfolio, the company will research and develop new
products in high demand and large market scale to quickly achieve efficiency.
With 20
years of experience in the snack industry, the company has gained a deep
understanding of local consumers. This, coupled with production capability
and distribution networks, will facilitate the company to become the
second-biggest player in the market trailing behind Mondelez in the next two
years.
According to
Nguyen, the snack and confectionery market has undergone massive changes in
the past five years with a rapid development of the gift segment and an
apparent rising demand for snack consumption from the middle-aged to elderly
people. Therefore, KDC wants to focus on developing key product lines such as
gifts for Mid-Autumn Festival and the Lunar New Year.
Another
player, The PAN Group, was also vying for a controlling stake of Bibica to
retain the long-standing Vietnamese confectionery brand amid the aggressive
expansion of foreign confectionery products. The move was aimed to solve a
dispute between Vietnam’s Bibica Corporation and its major shareholder, South
Korea’s Lotte Group.
According to
Euromonitor International, local producers are striving to keep their market
share. Vietnam One One Food JSC maintained its dominance in the popular rice
snacks category, which saw the fastest value growth over the year. Meanwhile,
Tan Tan Food & Foodstuff Company saw strong value growth in nuts, seeds,
and trail mixes for the fourth consecutive year in 2019.
In fact,
Vietnam is among the most developed snack markets in the ASEAN, joining
Thailand, Indonesia, and Malaysia in the $3.5-billion club, according to a
recent report from Japanese consultant Corporate Directions. This has
attracted many foreign brands to capitalise on the market growth. Among them,
snacking heavyweight Mondelez Kinh Do is taking the lead in the market. Other
foreign snack brands such as Oishi (Liwayway), Poca (PepsiCo), and Choco Pies
(Orion) have also stepped up their game to tap into Vietnam’s snack boom.
Most
recently, Japanese confectionary company Morinaga has joined forces with
DKSH’s Business Unit Consumer Goods, a market expansion services provider to
expand their existing partnership in Asia to Vietnam. Specifically, DKSH will
be the enabler to further unlock Morinaga’s potential in Vietnam and ensure
regional coverage through the strategic expertise of the local teams.
Damien
Morot, vice president of DKSH’s Consumer Goods in Indochina told VIR that
Vietnam offers a unique combination to snacks and confectionary brands
craving to expend outside of their core markets, and the country has the most
dynamic convenience stores network across the region.
“Though we
may see some players like key chains rationalise their number of stores in
the next few weeks and months as a consequence of the pandemic situation, the
consensus is built around strong, long-term double-digit growth for this
channel in Vietnam. This obviously stimulates the appetite of foreign brands
not yet present here,” he added.
While gum
and sugar confectionary have already reached high penetration in Vietnamese
households and broad distribution across the market, there is still huge
potential for the chocolate category. The improving logistics infrastructure
will continue supporting these categories growth in the near future and
festive periods like Lunar New Year celebrations allow introduction of a more
diverse offering to consumers.
Compared to
region peers, Morot stressed that Vietnam has an insatiable appetite for
consumers and retailers for high quality innovations, a segment where
Japanese brands are particularly doing well. Affordability remains a must in
Vietnam but those who manage to combine price points and high-perceived
quality will continue grabbing market share. The great successes of Kit Kat
and Fisherman’s Friend are a testament to this winning recipe.
On the same
note, Hemant Rupani, managing director of Mondelez Kinh Do Vietnam stated
that the country is a vibrant and competitive market as part of the ASEAN. In
Vietnam there are a large number of contenders in every industry, ensuring a
great deal of competition. In most sectors there are no dominant players, and
even those with a large market share are only operating at around the 20-30
per cent level.
“In
addition, Vietnam’s snack market will become even more competitive with the
upcoming implementation of the EU-Vietnam Free Trade Agreement. More foreign
producers and imported fast-moving consumer goods will flood the market,” he
added./.
First-of-its-kind clean
energy investment initiative for Southeast Asia
Major global
philanthropic organisations are this week launching a first-of-its-kind
high-risk philanthropic funding initiative aimed at crowding in more than
$2.5 billion of private investments for clean energy projects in Southeast
Asia.
With
traditional investors hesitant since the COVID-19 pandemic, the timely
intervention will provide the high-risk, early-stage venture capital-type
funding critical to getting transformational new clean energy projects off
the ground.
With an
initial focus on Vietnam, Indonesia, and the Philippines and managed by
Singapore-based Clime Capital, the Southeast Asia Clean Energy Facility
(SEACEF) has been supported by leading international climate foundations
including Sea Change Foundation International, Wellspring Climate Initiative,
High Tide Foundation, Grantham Foundation, Bloomberg Philanthropies, Packard
Foundation, and Children’s Investment Fund Foundation (CIFF).
“The launch
of this new fund comes at a critical moment, with the COVID-19 crisis
shrinking traditional sources of finance, dedicated towards bending the curve
of climate change,” said Imraan Mohammed, head of Impact Investing at CIFF.
“Impact investors and foundations are stepping up to bridge the gap, catalyse
other sources of funding and ensure that the transition to clean energy in
Southeast Asia continues to accelerate.”
Clime
Capital’s managing director Mason Wallick said, “Even in times of
stability, the first 1-2 per cent of development finance for clean energy
projects is the hardest to find, given it carries the highest risk. However,
the opportunities for renewable energy investment remain significant, so this
high-risk capital is a cornerstone at a time of great uncertainty, which can
catalyse the significant funding required to turn proposals into major clean
energy projects.”
According to
Bloomberg New Energy Finance, solar PV (Solar Photovoltaic panels) and
onshore wind are now the cheapest sources of new-build generation for at
least two-thirds of the global population. However, many potentially viable
projects in Vietnam, Indonesia, the Philippines, and other parts of Southeast
Asia would not happen without such early-stage funding, as most private
sector investors are unwilling to get involved until early-stage development
risks are successfully mitigated.
This is the
gap SEACEF’s investment aims to bridge. SEACEF's early-stage funding will
target globally proven technologies and business models such as solar, wind,
and energy storage, plus other business models that accelerate the low carbon
transition – such as electric mobility, demand-side management technology,
energy efficiency in buildings, and clean energy transmission infrastructure.
The
supporting global philanthropies have invested an initial $10 million into
SEACEF, and are seeking to attract up to $40 million in additional capital.
It is expected that every dollar of high-risk venture capital-type funding
deployed by SEACEF will leverage up to 50 times more in follow-on investment
into the clean energy portfolio across Southeast Asia – reaching more
than $2.5 billion of assets – while cultivating the local ecosystem of
developers to grow the market.
“On behalf
of the philanthropic funders of SEACEF, we are pleased to support this
innovative and catalytic climate investment programme that will fill a gap
left by traditional financial investors and help accelerate the market for
clean energy in Southeast Asia,” said Bill Weil, who led the design of SEACEF
at Tempest Advisors, the advisors to Sea Change Foundation International./.
LNG project illustrates new
interest
Chan May LNG
JSC will sign agreements involving American equipment, engineering,
procurement, and construction, with equity and financing worth $6.2 billion
of both United States and Vietnamese investment.
Chan May LNG
JSC is a US-Vietnam joint-stock company for the development and operation of
a $6.2 billion new gas-fired power plant in the central province of Thua
Thien-Hue. The plant is the development of a liquefied natural gas (LNG) port
for loading and off-loading, an on-shore LNG terminal, and a storage plant.
With power
generation capacity of 4000MW, the project will commercially supply LNG and
regular gas to the region and Thua Thien-Hue’s industrial and economic zones.
Chan
May-Lang Co economic zone (EZ) is at the focal point of two major zones with
the closest route to the East-West Economic Corridor. The private investment
developed in the strategic Indo-Pacific region supports the Enhancing
Development and Growth through Energy (EDGE) programme for Vietnam.
Vietnam’s
power demand has risen sharply in line with rapid economic growth,
constituting 12 per cent of GDP. As a result, resolving the power shortages
expected in the future has become a pressing issue and top priority. Under
the revised National Power Plan VII, the Vietnamese government strives to
meet the annual power demand growth of 10 per cent by stepping up its power
generation capacity to 95,500MW by 2025 and 129,000MW by 2030 through
projects like Chan May LNG.
The project
is divided into two phases. The first of 2,400MW is targeted to be completed
and delivered in 2024; and the second of 1,600MW is to be delivered by 2028.
The company expects the project to be integrated into the national power
development plan within the next few months and meet all government
regulatory requirements. About 3.5 billion cubic metres of gas per year will
be imported from the US.
The United
States is currently the world’s largest producer of natural gas. The gas
supplies nearly a third of US primary energy usage and is the primary heating
fuel for approximately half of US households. While the majority of natural
gas is delivered in its gaseous form via pipelines in the US, the growth in
the international market for natural gas has given rise to the use of natural
gas in a liquefied form.
Data from
2017 shows that the US exported over 700 billion cubic feet of natural gas in
the form of LNG in large tanker ships, along with small quantities shipped by
container or trucks. In total the following year, US LNG had been delivered
to 27 countries on five continents and the list of destinations has continued
to grow since, especially to countries like Vietnam.
The
consortium team for the Thua Thien-Hue power plant consists of international
environmental firms with a combined experience of over 80 years in Vietnam,
while the US investors and developers have a combined total of 60 years of
development experience in the country.
Development
of an LNG power plant in the Chan May-Lang Co EZ will likely generate
positive economic impacts in a variety of ways on the local economy from the
construction to the operational phase. A project of this nature and scale
generally increases local GDP by 7-15 per cent during construction and 5-7
per cent during operations, according to experts. This increase in GDP over
the life of the project will have significant benefits to families, local
businesses, and the ability of the province to meet master plan objectives.
“Chan May
LNG is pleased to support delivery of a world-class project in Thua
Thien-Hue. We aim to achieve this by bringing together experienced
professionals with first-hand knowledge regarding financing, supply,
construction, and operation of LNG power development,” said John Rockhold,
CEO and vice chairman of Chan May LNG. “Our US and Vietnamese consortium have
a successful track record working with proponents of LNG and power plant
developments, provincial governments, and local consultants to design and
construct world-class operating assets.”
Chan May LNG
will attend the Vietnam Energy Summit 2020 in Hanoi next month. The summit,
originally scheduled for March but inevitably postponed due to the
coronavirus crisis, will take place on July 22 at the capital’s International
Convention Centre.
Co-organised
by the government and the Central Economic Committee, various ministries and
institutions such as the EU, the German Development Cooperation (GIZ), and
the Embassy of Finland will be represented. Held with the aim of being timed
with the Politburo’s resolution on Vietnam’s national energy development
strategy orientation to 2030 and with a vision to 2045, the event is
considered to be the most prestigious event in the country’s energy industry
this year./.
Agriculture, forestry, and
fishery must prepare for EVFTA bounties
The upcoming
implementation of the EU-Vietnam Free Trade Agreement (EVFTA) will help
Vietnam's agriculture, forestry, and fishery sector to step onto a larger
playground and join the global supply chain.
The
information was stressed at the conference on facilitating agriculture,
forestry, and fishery companies to enter the EU market and implementing the
EVFTA efficiently held by the Ministry of Industry and Trade in collaboration
with the Ministry of Agriculture and Rural Development and Ho Chi Minh City
People’s Committee on June 30.
According to
Minister of Industry and Trade Tran Tuan Anh, the EU is Vietnam’s
second-largest export market but Vietnam only accounts for 2 per cent of its
total imports. Once the EVFTA come into force, Vietnam’s agriculture,
forestry, and fishery sector can access a potential market with 500 million
people and a GDP of $15 trillion. The export turnover of agriculture,
forestry, and fishery products to the EU has been around $5 billion per year
between 2017 and 2019.
He added
that the EVFTA is an ambitious pact eliminating
almost 99 per cent of customs duties between the EU and
Vietnam. The official entry of this FTA is expected to create a driving force
for Vietnam to recover from COVID-19. With several advantages, Vietnam’s
agriculture, forestry, and fishery sector is positioned as a major
beneficiary of the EVFTA.
The
agreement covers all rice varieties most commonly exported from Vietnam to
the EU, including milled rice, husked rice, broken rice, and fragrant rice.
These will see mostly duty-free tariffs as soon as the FTA is implemented,
except for broken rice which will see a 50 per cent tariff cut when the FTA
comes into force, followed by a linear reduction over five years.
Meanwhile,
Vietnamese seafood that will see improved market access via duty-free tariff
rates or full liberalisation include surimi (seafood paste, most commonly
fake crabmeat), canned, fresh and chilled tuna, and non-processed shrimps and
catfish.
Minister of
Agriculture and Rural Development Nguyen Xuan Cuong said that companies
should carefully prepare to meet the EU requirements and avail of
opportunities from the EVFTA. In the case of Trung
An Hi-Tech Farming JSC, which is looking to increase rice exports
to the EU, the ministry will provide further guidance about the potential
seeds, production processes, and requirements. The ministry can even seek
special mechanism for some exporters to help Vietnam fulfill the EVFTA
requirements as well as ensure product quality./.
Vinh Phuc invests technical
infrastructure to lure investors
Vinh Phuc
province is making an effort to complete technical infrastructure while
simultaneously accelerating investment promotion programmes in order to
attract potential investors, especially foreign-invested enterprises after
the pandemic.
Vinh Phuc is building out technical infrastructure to become a more welcoming investment destination Located close to Hanoi and owning 18 IZs (IZs) and 32 industrial clusters, Vinh Phuc is improving its investment and trade environment, enhancing its competitive capabilities to attract investment.
The COVID-19
pandemic has had a marked impact on socio-economic development in the
province, disrupting the operations of enterprises as well as foreign
investors’ plans. Numerous companies had to lay off employees due to a lack
of orders, which caused a plunge in revenue and profit. Other businesses had
to deal with a lack of experts and skilled employees due to Vietnam’s policy
suspending foreign entry.
In the first
six months of the year, the pandemic has caused a decrease in
foreign-invested capital in the province. Notably, investors registered only
$135.6 million, only a third of last year’s figure, in 14 newly-registered
and 19 existing projects.
In order to
help enterprises overcome their difficulties and prepare to welcome new
investment after the pandemic, the province’s leaders assigned departments
and relevant authorities to implement solutions to support businesses.
Notably, the province organised numerous meetings, seminars, and working
sessions with investors and enterprises to discover their difficulties. In
addition, the province entered into a co-operation with the State Bank of
Vietnam to build supporting policies for businesses, including decreasing
loan interest and extend debt payment deadlines. Besides, the Department of
Taxation supported enterprises to extend the deadline for tax payments and
the fee for land rental.
Furthermore,
the provincial People’s Committee asked localities to implement synchronised
solutions to deal with investors’ difficulties by removing administrative
bottlenecks for newly-registered projects, supporting enterprises investing
in infrastructure at industrial parks and clusters by accelerating land
clearance and compensation in order to accelerate the construction progress.
The province
has also completed a report on the investment planning for a series of IZs,
including Tam Duong I, Lap Thach I and II, and Nam Binh Xuyen. It is also
building dossiers to submit the construction plan of Song Lo 2 IZ to the
Ministry of Planning and Investment for appraisal and then submit it to the
prime minister for approval.
Vinh Phuc
Industrial Park Authority has built the detailed planning of Khai Quang IZ
while urging investors to complete procedures to accelerate the development
of Son Loi IZ and sign a management contract with partners in Ba Thien IZ.
“The
province is actively trying to accompany investors to overcome difficulties
and will create favourable conditions in administration procedures as well as
technical and transport infrastructure, assuring investors looking to set up
or expand operations in Vinh Phuc,” said Nguyen Van Tri, chairman of Vinh
Phuc People’s Committee.
“The
province is also paying attention to developing urban and apartment projects
to create stable accommodation for workers and experts, including affordable
apartment projects,” Tri said.
Vinh Phuc
People’s Committee also assigned the Department of Planning and Investment as
well as the Investment Promotion Agency to organise investment promotion
programmes. Notably, the province issued the investment promotion programme
for this year and organised a conference to analyse the component indices of
the province’s Provincial Competitiveness Index 2019 and discuss improvements
during this year and upcoming ones.
In addition,
during social distancing, representatives of departments made suggestions and
supported investors via social networks like Zalo to both comply with the
isolation policy and implement online investment promotion activities.
Furthermore, the province continues to reduce the time it takes for investors
to complete procedures to set up business, register business online, and
publish administrative procedures as well as the province’s planning to
ensure full transparency.
In general,
the province has received particular praise for its workforce training, the
safety of its legal institutions, and the pioneering role of local
governance, all of which are drawing attention from long-term investors. This
explains why local and global giants, especially Europe and America, are keen
on the province. One of the outstanding success stories is Piaggio which has
two plants in the province. The other is De Heus, a high-quality European
animal feed producer, one of the five largest animal feed manufacturers in
Vietnam that is making extensive contributions to the agricultural
development of not only Vinh Phuc but the whole country.
In addition,
many global corporations such as Toyota, Honda, Daewoo, and Sumitomo have
invested in Vinh Phuc, focusing mainly on the fields of processing
technology, manufacturing, electronic assembling and industrial zones
infrastructure.
Vinh Phuc
currently has 392 foreign-invested projects with the total registered capital
of $5.57 billion, from 18 countries and territories in the province./.
CPI likely to increase by
3.5- 4 percent this year: experts
The consumer
price index (CPI) is projected to increase by between 3.5 percent and 4
percent this year, according to experts at a seminar held in Hanoi on July 2,
which focused on national market and price movements in H1 and
forecasts for the whole year.
Assoc.
Prof., Dr Nguyen Ba Minh, Director of the Institute of Economics-Finance at
the Academy of Finance said there are two factors pushing the CPI up in the
second half, which are recovering prices of materials and fuels after the
pandemic is put under control, and the resumption of production
and international trade and exchanges.
Meanwhile,
factors that could restrain the CPI include slow economic recovery due to
pandemic, trade wars and political instabilities in many areas in the world.
Besides, the
prices of pork in the country are expected to subside thanks to efforts to
improve the supply of the food.
Vietnam has
carried out preventive measures against the COVID-19 pandemic,
stabilised market prices, regulated currency policies for macroeconomic stabilisation
and inflation control, thereby keeping the CPI stable, he added.
According to
Dr Nguyen Duc Do, as inflation stood at 3.17 percent compared to the same
period last year, the target of keeping inflation under 4 percent in 2020
will be possible.
He pointed
out that the oil prices would not rise much as the recovery prospect for the
world economy is gloomy, while domestic pork prices are unlikely to surge in
the coming time as the Government allows imports of pigs. Therefore, he
maintained the 3.5-percent projection for this year’s inflation./.
Indonesia listed among
upper-middle income countries by WB
Indonesia is
now an upper-middle income country, an upgrade from its previous status as
lower-middle income, according to the World Bank’s latest country
classifications by income level published on July 1.
The
classifications are based on gross national income (GNI) per capita.
Upper-middle income status categorises countries with a GNI per capita of
4,046 USD to 12,535 USD, while lower-middle income status categorises
countries with a GNI per capita of 1,036 USD to 4,045 USD. Countries with a
GNI per capita of below 1,036 USD are considered low income and those with a
GNI per capita of 12,535 USD are considered high income.
Indonesia
saw its GNI per capita rise to 4,050 USD in 2019, surpassing the income
threshold for upper-middle income, from 3,840 USD in 2018.
Indonesia’s
improved status is a proof of economic resiliency and maintained economic
growth over the last few years, the Finance Ministry said in its statement.
According to
the statement, the Indonesian government will continue to push for structural
reforms to boost competitiveness, improve industry capabilities and reduce
the current account deficit to empower the economy./.
Regional small firms prioritising
investment in technology
Investment
in technology is the top investment priority for small enterprises in
Southeast Asia this year, according to a survey.
This
priority applies even to small businesses that face cash flow concerns, the
United Overseas Bank (UOB) and Dun & Bradstreet said in a joint release
on July 1.
The release
cited findings from a survey by the UOB, Accenture and Dun & Bradstreet
in the third quarter of 2019 and in May 2020, which polled 1,000 small
businesses with an annual turnover of 20 million USD and below in five
countries - Indonesia, Malaysia, Singapore, Thailand and Vietnam.
Technology
was ranked the top investment priority for 2020 by 64 percent of businesses
surveyed, followed by investments in developing employees' skills (51
percent), and in machinery or equipment (40 percent).
Among the
five countries polled, Thailand had the highest proportion (71 percent) of
respondents prioritising technology investments this year, followed by
Indonesia (65 percent), Vietnam (63 percent), Singapore (60 percent) and
Malaysia (59 percent).
Besides,
small businesses from the food and beverage, information and communications
technology and healthcare sectors (50 percent) indicated the strongest desire
to boost their technology investments, followed by those in construction (48
percent) and retail trade (46 percent).
Although 88
percent of businesses had lowered their revenue expectations in 2020, 44
percent said they still planned to increase their overall technology budget.
This suggests
that small businesses in Southeast Asia are looking beyond the present
challenges and are set on adopting technology to improve their
competitiveness and sustainability, according to the release./.
Recruitment demands drop 20
percent in Q2
Recruitment
demands in Quarter 2 have dropped 20 percent from the previous quarter,
according to Adecco Vietnam.
The
recruitment and staffing company’s report on the labour market released on
July 2 cited a survey among 330 HR experts in May this year, in which 93 percent
of the respondents said their companies were affected by COVID-19. Up to 43
percent of the companies saw their revenues reduce by 21-40 percent.
As a result,
58 percent of the companies chose to postpone all recruitment activities.
Companies also had to suspend payment rise and promotion, or cut working
hours.
However,
there were increases by 10-15 percent in demands for technical experts and
sales persons in companies operating in technology, health care and consumer
goods.
Nguyen Thu
Ha, head of Adecco Vietnam’s Hanoi office, said local experts were more
sought after in Q2 than foreign counterparts, which is attributable to cuts
in recruitment budget and travel restrictions. The salary on offer was also
lower that the average last year.
Ha said
recruitment demands will improve in Q3 when some countries begin to re-open
its border and companies rush to implement their business plans which have
been delayed./.
Thailand: COVID-19 may cost
tourism sector 47 billion USD
Thailand’s tourism
sector would lose 47 billion USD due to the impact of the COVID-19 pandemic,
according to the UN Conference on Trade and Development (UNCTAD).
The
country’s Ministry of Tourism and Sports said Thailand may receive
only 9 million international visitors this year, compared to the record 39.8
million in 2019. Plummeting revenues from tourism is also a reason for the
Bank of Thailand (BoT) to forecast a minus 8 percent growth for the country
in 2020.
The tourism
sector has drafted a travel bubble plan for foreign travellers to make up for
the losses. The three-phase plan is slated to start in August, with 1,000
tourists per day across five provinces.
Minister of
Tourism and Sports Phiphat Ratchakitprakarn said the ministry already asked
the Association of Thai Travel Agents (ATTA) and the Tourism Council of
Thailand (TCT) to design 6-7 day tour packages in five areas that are ready
to join the pilot project, comprising Chiang Mai, Koh Samui, Krabi, Phuket
and Pattaya.
On June 30,
the Thai cabinet approved two stimulus packages worth 22.4 billion THB (723
million USD) to revitalise domestic tourism.
In the first
five months of this year, the total number of domestic flights in Thailand
dropped 58.2 percent, reaching 40.2 million trips, with revenues falling 57.9
percent to 191 billion THB.
Data from
the Tourism Authority of Thailand (TAT) showed that international arrivals to
the country plunged 60 percent in the period to 6.69 million and revenues
from them decreased 59.6 percent to 332 billion THB./.
Indonesia to cut diesel
subsidy by half next year
The House of
Representatives of Indonesia has approved the Government’s plan to cut diesel
subsidy by 50 percent to 500 RP (0.35 USD) per litre next year, on the back
of expectations that crude oil prices will remain low in the aftermath of the
COVID-19 pandemic.
According to
the Indonesian Ministry of Energy and Mineral Resources, the Indonesian Crude
Price (ICP) is projected to hover between 42 USD and 45 USD per barrel in
2021, lower than the 2019 ICP average of 63 USD per barrel.
Speaking at
a meeting on June 29, Minister of Energy and Mineral Resources Arifin Tasrif
said the lower house also gave its nod to a plan to increase the quota for
liquefied petroleum gas (LPG) while maintaining the quota for subsidised fuel
in the 2021 draft state budget (RAPBN).
The Cabinet
and the House are currently drafting the 2021 state budget, with President
Joko Widodo scheduled to announce the finalised RAPBN during the state of the
nation address in August.
Alloysius
Joko Purwanto, an energy economist at the Economic Research Institute for
ASEAN and East Asia (ERIA), estimated that slashing the diesel subsidy by
half could save the government about 12.4 trillion RP.
VNN
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Thứ Ba, 7 tháng 7, 2020
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