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VIETNAM
BUSINESS NEWS JUNE 26 08:43 FPT to take new trading system for HSX live at the end
of June  FPT is
confident that its trading system for the Ho Chi Minh City Stock Exchange
(HSX) will be ready to launch within the next few days. Duong Dung
Trieu, chairman of FPT Information System (FIS) under FPT Group, is confident
that the new trading infrastructure developed by FPT will dispel congestions
on the HSX. “When we
were assigned by the State Securities Commission and the HSX, the special
working group of 50 experts from FPT and 30 from HSX began working to address
HSX’s congestion and more than triple the capacity of HSX,” Trieu said. FPT has
brought its tailored-made software for the Hanoi Stock Exchange (HNX) to
deploy at HSX to alleviate order problems. To this end, FPT is modifying the
trading system to align with HSX regulations and the order receiving system
to fit the connection standards of securities companies in HSX. FPT aims to
integrate its new trading system into the existing systems of HSX and
relevant agencies such as the Vietnam Securities Depository Centre, update
daily data conversion, and help securities companies trade with the daily
transaction. Trieu also
said that FPT has already identified potential issues and prepared remedial
measures. It is expected that by the end of June, the FPT trading system can
be taken live. Investors
have been complaining since securities companies stopped allowing the editing
and cancellation of orders on HSX since June 2 to reduce the load on the
system. A week later, some companies have resumed these functions but some
securities were still locked at rush hour. Meanwhile,
Ho Duc Phoc, Minister of Finance, last week said that trading congestions on
the HSX will be addressed in July. The latest
solution will be the forthcoming adoption of technical infrastructure
from the Korea Exchange (KRX) in August. 10-year Gov’t bond futures to be launched on June 28 The 10-year
government bond future contracts will be officially launched on derivatives
market from June 28, according to the Hanoi Stock
Exchange (HNX). It is the
third derivative product following the VN30 index and 5-year government bond
futures. The HNX
hoped that the new futures will contribute to diversifying derivative
products on the market and become an effective hedging tool
for Government bond market. The product
has underlying assets as 10-year government bonds issued by the State
Treasury, each worth 100,000 VND (4.3 USD) with an annual interest rate of 5
percent. Since the start
of its operation on August 10, 2017, derivatives market has seen a surge in
trading volume, from 10,954 contracts per session in 2017 to 158,390 in
2020./. More heat expected in e-wallet market Contactless
trends reinforced by pandemic restrictions are creating a window of
opportunity for more e-wallets and payment intermediaries to further expand
in the digital ecosystem, as evidenced by recent comprehensive integration
between partners. Wirecard
Vietnam, previously a local franchise of Wirecard Singapore, secures the
largest market share in terms of POS system, cooperating with more than 40
major banks and electronic payment companies. BCCard,
which is backed by South Korea’s largest telecommunications company KT
Corporation as well as Woori Bank, said it would provide integrated terminals
that can accommodate various payment approaches. Choi
Won-Seok, president of BCCard, highlighted, “We will strive to generate
profits in various fields by diversifying our business structure by entering
overseas markets.” Vietnam’s
e-payment market is predicted to reach a total value of $15 billion by the
end of this year, and the sector is also expected to grow by 15 per cent
annually until 2025. Vietnamese state-owned telecommunications provider
MobiFone last week officially launched a MobiFonePay e-wallet – a move to tap
into intermediary payment services and mobile money. MobiFonePay
aims to enhance non-cash payment transactions such as mobile top-ups, bill
payments, internet TV, and more. In its first
stage of development, MobiFonePay will adopt a zero-fee policy for all
payment transactions, transfers, and accumulated points for consumers. This
is deemed a sufficient condition for MobiFone to join the race for mobile
money implementation, which was approved by the local government in March. Previously,
both Viettel and VNPT had rolled out their e-wallet services. Viettel Pay
announced its number of users exceeded nine million in February 2020, while
the VNPT e-wallet boasted nearly 50,000 POS across the country last year. The bill
payment market in Vietnam has gained more popularity. Payoo has also deployed
its services through a home-made platform to make bill payments more
convenient, especially utilities such as electricity, water, television, and
internet bills. Applications to track electricity numbers and bills are
prevailing in the context of social distancing and increasing demand for
electricity. Most
recently, AirPay e-wallet has been renamed ShopeePay to increase its brand
awareness. ShopeePay is integrated into Shopee to facilitate transactions on
the e-commerce platform. The ShopeePay e-wallet is also a standalone app
offering many services. The move also reflects the efforts of Sea Ltd., the
parent company of Shopee, to expand its presence in Vietnam. Foody’s Now
was one of the earliest players in Vietnam’s online food delivery market.
However, Now is in fierce competition with heavyweight competitors like
GrabFood, Go Food, and Beamin. If ShopeePay becomes more popular, it may help
Now snag more users from other rivals. Last month
VNLIFE, the parent company of VNPAY, announced its target to secure $200
million in its next fundraising round taking place in the next few months.
VNLIFE had approached Facebook for investment, but the two sides were not
able to reach a mutual agreement, cited DealStreetAsia. Dang Tuyet
Dung, Visa country manager for Vietnam and Laos, believed that the pandemic
has been a major disruptor for businesses and consumers alike. “Banks,
fintech companies, and merchants are looking at a transformed landscape where
success lies in offering consumers convenient, frictionless, and safe payment
methods, while educating non-users of the potential gains in going digital,”
Dung said. According to
a Visa Consumer Payment Attitudes study, Vietnamese expect the country’s
transition to a cashless society to happen as soon as 2030, with the majority
(84 per cent of respondents) already having attempted to go digital and get
by without using cash. Prospects abound for Vietnam to become PPE hub Vietnam is
emerging as a strong personal protective equipment manufacturing hub with
more producers beefing up capacity in order to meet the soaring demand. There are a
wide variety of categories in PPE such as respirators, head and face
protection, hearing protection, eyewear, and high visibility clothing, and
these solutions are ever more critical in people’s daily lives either for
industrial, healthcare, or the consumer market. According to
Jacky Kang, country leader of 3M Vietnam, there has been a growth in PPE
demand in Vietnam recently, indicating that people have become more conscious
about their health and safety. Nevertheless, the numbers pale in comparison
with the working population of the country. There remains, as a result, an
enormous untapped potential market in the PPE industry. As one of
the leading global PPE manufacturers, 3M is continuing to innovate and create
new products to support wellbeing and safety during the pandemic. Some of
them entail new advanced filtering masks and respirators for consumers and
businesses. Elsewhere,
Top Glove Corporation Bhd last year announced its plan to develop its first
glove factory in Vietnam at Bau Bang Industrial Zone in the southern province
of Binh Duong. Estimated capital expenditure for the first phase is about $70
million, while the factory’s annual initial production capacity is
approximately 4.8 billion gloves from its 20 production lines. Meanwhile,
the Japanese government has assisted a number of their companies to make
medical devices, face masks, and protective clothes in Vietnam. Japanese
apparel maker Matsuoka Corp. plans to invest around $28 million into its
Vietnamese manufacturing unit An Nam Matsuoka Garment Company to produce
protective clothing. Other
Japanese investors also secured Japanese government subsidies to expand PPE
production in Vietnam, like Nitto Denko Corporation producing materials for
N95 masks, Shingoshu Co., Ltd. producing PPE and its material fabric, and
Showa Co., Ltd, making medical masks, as well as Able Yamauchi making medical
protective clothing. In addition
to foreign players, some local manufacturers also identify business in this
field. As traditional suppliers struggled to meet the growing worldwide
demand, Vietnamese textile manufacturers – who in 2020 saw their orders drop
– decided to leverage their expertise and untapped production capacity to
start producing PPE, according to Filippo Bortoletti, senior manager of
International Business Advisory at consultancy firm Dezan Shira &
Associates. Data by the
Ministry of Industry and Trade showed that Vietnam is home to more than 6,000
garment and textile factories employing about three million workers. Such
significant industrial capacity makes it well positioned to take an important
role in the global PPE supply chain and results are so far moving in the
right direction. Bortoletti
said that PPE manufacturers first targeted the domestic market due to
restrictions imposed on exports. But as such restrictions were lifted over a
year ago, the PPE made in Vietnam started circulating worldwide. “This
happened naturally, and the diversification of the PPE supply chain worldwide
is beneficial to avoid future shortages and disruptions, as COVID-19 taught
us. Therefore, there is an interest – not only locally – to foster the
development of Vietnam’s PPE industry to smoothen the manufacturing process,”
he said. According to
insiders, it is likely that the global demand for PPE will stay robust and
some even forecast a steady increase in demand until 2025. When the pandemic
is over, the demand for PPE will likely drop, but not plummet, as governments
and consumers are likely becoming more sensitive towards health and
prevention. Pham Xuan
Hong, chairman of the Association of Garments-Textiles-Embroidery-Knitting in
Ho Chi Minh City, said that many textile manufacturers had shifted production
to PPE in response to the health emergency and to mitigate losses caused by
cancelled orders for garments. Another
potential sector for PPE manufacturers is the development of respirators.
Kang from 3M Vietnam pointed out that they can be considered as a highlighted
category observing significant changes and growth, and there are many factors
leading to the growth of this category. “Firstly, it
is the impact of the pandemic and media endorsements that help promote a
better understanding of respirators to ordinary consumers,” Kang said.
“Secondly, the fast growth of Vietnam’s middle class makes respirators more
accessible for far more consumers. Finally, some companies have expanded
their distribution to end-users, enabling consumers to easily purchase
high-quality respirators in their residential areas.” While PPE
manufacturing is not likely to be a long-term business for most current
producers, it could become a core business for some. Bortoletti from Dezan
Shira & Associates added, “I see the opportunity of manufacturing PPE as
very short-term solution to utilise untapped production capacity and exploit
a ‘new’ market. A few local players might seriously consider switching
towards PPE for the long-term.” New rule reshuffles tax burden While new
efforts from the Vietnamese government to press e-commerce platforms to
declare and pay tax on behalf of individual vendors and business households
would unscramble tax enforcement for local authorities, e-commerce platforms
are pushing back against the extra burden placed on them. Under the
circular, from August 1, the owners of e-commerce platforms will be
responsible for declaring and paying tax on behalf of the individuals
according to a roadmap announced by the tax authorities. While this is not
yet possible, as a temporary measure, e-commerce platform owners are now
legally obligated to provide information related to individuals’ business
activities on their platforms at the request of tax authorities. The income
threshold for business households and individuals to be subject to VAT and
PIT will remain at VND100 million ($4,350). Taxpayers include individuals
earning income from e-commerce businesses as well as digital content and
service provision. Circular 40
is part of the ongoing regulatory clampdown on Vietnam’s e-commerce market.
With the new regulation, the government can now ensure e-commerce platforms
play their part in tax collection. The circular will also create a
level-playing field for brick-and-mortar retailers which have been fighting
from a tax disadvantage in past years. Tracking
these e-commerce platforms to ensure VAT and PIT are paid through data
sharing and extending liability to platform owners will allow local tax
authorities to focus enforcement efforts on the relatively few marketplaces
rather than the millions of vendors operating through them. E-commerce
platforms, including the likes of Shopee, Lazada, Tiki, and Sendo, will have
to declare and pay tax for their online sellers from August 1, but many
questions remain unanswered. A representative of Lazada Vietnam said that it
is managing online sellers across many countries so the app is built
uniformly to ensure the efficiency and safety of the e-commerce platform. Any technical
change to serve tax management will require close coordination between
e-commerce platforms and local tax authorities. To accommodate this work,
Lazada has proposed extending the roadmap to implement the new regulation. In
addition, she suggested the clarification of which tax authorities are
entitled to request businesses to provide information as well as the exact
information businesses will have to disclose to ensure information security
and avoid clashes with other laws. Meanwhile, a
spokesperson for Shopee Vietnam said that regulations need to provide clear
guidance on distinguishing business households and individuals as e-commerce
platforms will only have to declare and pay tax on behalf of individuals.
Clear classification will help e-commerce platforms to upgrade their apps to
comply with Circular 40. She added
that regulatory bodies should also pass regulations to manage individuals
selling on social networking platforms to ensure fairness. Voicing
agreement, Nguyen Ngoc Dung, vice chairman of the Vietnam E-commerce
Association added, “The new rules will trigger inequality between e-commerce
and social commerce, such as Facebook. Inevitably, this will discourage
businesses from increasing their presence here via e-commerce, which goes
against the government’s policies to encourage the development of the digital
economy.” He also
voiced concerns over major challenges stemming from the new tax regulation.
Specifically, due to the short time until Circular 40 comes into effect,
businesses will find it difficult to prepare data in time to report to the
tax authorities. Furthermore,
there will be great geographic disparities as according to Article 45 of the
Law on Tax Administration, tax declarations have to be submitted to local tax
authorities where the tax subject is physically located. However, e-commerce
platforms maintain extensive networks with a myriad vendors located across
many cities. “This will
create conflicts with other regulations,” Dung warned. Moreover, by
creating additional administrative procedures, the new circular clashes with
Article 3.1 of Decree No.63/2010/ND-CP and the Law on Promulgation of Legal
Documents 2016. Requests to
provide information also need to ensure compliance with current regulations
on the protection of personal information in the Law on Cybersecurity, the
Law on Protection of Consumers’ Rights, and the Law on E-transactions, Dung
added. HCM City supermarkets stock up goods amid Covid-19 outbreak Supermarkets
in HCM City are stocking up and tightening preventive measures during the
Covid-19 outbreak as the number of customers increases. HCM City has
237 supermarkets and nearly 2,800 convenience stores. Some convenience stores
including a Big C Supermarket in District 10 were shut after Covid-19
patients found to have visited those stores. After HCM
City authorities ordered to close flea markets and tighten prevention
measures, more residents have switched to supermarkets and convenience
stores. As the result, supermarkets in HCM City have stocked up while
applying stricter preventive measures. Co.opmart
and Co.opXtra supermarkets ask customers to complete a medical declaration
form before entering and regulate the number of customers to avoid large crowds
inside the supermarket. Supermarkets
at Aeon Malls were disinfected four times a day. Nguyen Nhon Quy, head of the
PR Department of Aeon Vietnam, said shippers at the mall wait in a separate
area, while drivers and employees that have direct contact with customers
were provided with face shields. Nguyen Thi
Kim from Tan Phu District said she had completely switched to online
shopping. "I only have to wait at home and can avoid going to crowded
places. I can make online payments so direct contact is limited," she
said. Most
supermarkets and convenience stores in HCM City now offer online services and
have improved their services daily to attract customers. Pham Thi
Van, manager of Satrafood convenience store chain said, "Our online
orders increased by 50% and revenue increased by 30%." Fair introduces high-quality Vietnamese products to Thai
consumers A trade
promotion expo featuring more than 150 Vietnamese goods of high quality is
taking place in Thailand's Udon Thani province from June 24 to 27 as part of
activities marking the 45th anniversary of diplomatic relations between the
two countries. The
Vietnamese Goods Week in Thailand - Udon Thani 2021 themed "A Flavour of
Vietnam" is being participated by more than 20 Vietnamese firms,
including Dalat Hasfarm, which sells fresh flowers and plants; Lam Dong
Pharmaceutical JSC; Dong Xuan knitting company; Hong Ha and Thien Long
stationery companies. As part of
the event at the Central Plaza in Udon Thani, fruits imported from Vietnam by
the Central Group like lychee, dragon fruit, and sweet potato, are on
display. Notably, close to 200kg of lychees prepared by the organisers have
sold out. Other stalls selling traditional Vietnamese food like pho and
spring roll are attracting many visitors. Speaking at
the opening ceremony on June 24, Vietnamese Trade Counsellor in Thailand Tran
Thi Thanh My said the programme brings opportunities for Vietnamese companies
to introduce their goods in Thailand and for Thai people to access
made-in-Vietnam products. She said the
number of participating firms is limited due to COVID-19, expressing her
belief that Vietnamese products on display will be favoured by Thai locals. My hoped for
more trade promotion events to take place in the time to come for increasing
economic and commercial cooperation between the business communities, and
people of Vietnam and Thailand. Wanchai
Janporn, Deputy Governor of Udon Thani, informed that his province houses the
highest number of Vietnamese expatriates in Thailand, reflecting deep ties
between locals and Vietnamese people. The official also highlighted his
confidence in the success of the expo. Emmananuel
Couronne, Chief Merchandise Officer at Central Food Retail Group, said the
Vietnamese Goods Week in Thailand is an important annual event of the Central
Group, considering it a good chance for boosting Vietnam - Thailand relations
and connecting their enterprises, serving Vietnamese and Thai consumers'
demand. The Central
Group and its partners wish to play the role of a product promotion channel
for Vietnamese goods in Thailand and in the world, he affirmed./. Hanoi’s economy expands in H1 despite COVID-19 Hanoi’s
economy still expanded despite impacts from the COVID-19 pandemic, with
its gross regional domestic product (GRDP) up 5.91 precent in the
six months of 2021, higher than 3.39 percent recorded in the same period last
year, said Vice Chairman of the municipal People’s Committee Le Hong
Son. During a
conference held in the capital city on June 24, Director of the municipal
Department of Planning and Investment Do Anh Tuan said the city's state
budget collection was estimated at over 124.85 trillion VND (5.42 billion
USD) during the period, equivalent to 53 percent of the estimate and a 7.1
percent rise year-on-year. The city
continued supporting investors and firms from business registration to
project implementation, creating a healthy and fair environment to access
land. The flow of
foreign direct investment reached 694.26 million USD, including 96.05 million
USD registered for 171 new projects, 447.7 million USD added to 78 existing
projects, and 120.5 million USD in capital contribution and share purchases. The amount
of domestic investment hit over 7.1 trillion VND, including 1.47 trillion VND
registerd for 10 new projects and more than 5.63 trillion VND added to 38
underway projects. There were
13,125 newly-established firms with a total registered capital of over 165.7
trillion VND, up 4 percent in the number of enterprises and down 7 percent in
value, bringing the total firms in the city to 314,248. To achieve a
growth rate of 7.5 percent this year, Son called for further attention to the
manufacturing and processing sector, allocating State budget to key areas,
stepping up the equitisation of State-owned enterprises, providing support
for tourism companies in restructuring, popularise Hanoi’s products to cities
and provinces, and start construction of industrial complexes on schedule. He asked the
municipal Department of Justice to review and supplement legal documents to
lay a legal foundation for sustainable development. The Vice
Chairman also assigned specific jobs to agencies, departments and localities
to fulfill key tasks in the remaining months of this year./. Vietnam considered in good position to attract FDI: UK-based
website The
Vietnamese economy has fared better than most during the COVID-19 pandemic
and is well placed to capture renewed FDI interest, according to an article
posted on the UK website lexology.com on June 23. The article
said in recent years, the Vietnamese Government has focused on opening its
market while also boosting its international trade ties. After joining the
World Trade Organization (WTO) in 2007 and many regional conventional trade
agreement with the US, China, Europe, Japan, the Republic of Korea (RoK) and
most of the significant economies in the world, the country has become a
member of the “new era” global free trade agreements that form the biggest
trading blocks of the world today such as the Comprehensive and Progressive
Agreement for Trans-Pacific Partnership (CPTPP), the Regional Comprehensive
Economic Partnership (RCEP) as well as free trade agreements with the
European Union, Japan and the RoK. It noted
that Vietnam’s position in the World Bank’s annual ease of doing business
ratings has climbed from 91 out of 183 countries in 2010 to 70 out of 190
countries in 2019, adding that the country has also begun to look away beyond
low-tech manufacturing to high value added and high tech sectors of the new
economy, industry 4.0 and digital transformation. Aware of
that the ability to hold on to its competitive edge in the cheap
manufacturing space is very limited, Vietnam has thrown its weight behind
high-value industries such as electronics and software engineering,
positioning itself to capitalise upon the fourth industrial revolution. The
electronics industry is one of the country’s fastest-growing. The value of
its electronics exports rose from 47.3 billion USD in 2015 to 96 billion USD
in 2020, accounting for a third of national exports. In the global ranking of
electronics exporters, Vietnam has climbed from 47th place in 2001 to 12th
place in 2019. The article
cited statistics of the Vietnamese Ministry of Industry and Trade data which
showed that FDI firms accounted for 95 percent of electronics export revenue
in the first quarter of 2021. It affirmed that there is little reason to
suspect that this trend will change in the coming years. Vietnam has
committed to climbing the manufacturing value chain through FDI and has been
working for years to upskill its population in preparation. The Vietnamese
government’s economic and regulatory efforts will help drive FDI towards the
Southeast Asian nation in the coming years, wrote the article./. Ba Ria-Vung Tau: Container cargo through ports rise by 38
percent in 5 months The total
volume of goods passing through seaports in the southern port province of Ba
Ria – Vung Tau reached nearly 48.28 million tonnes in the first five months
of this year, up 9 percent year-on-year, according to the Vung Tau Port
Authority. It said the
volume of container cargo through the local seaports rose by more than 38
percent, despite impacts of COVID-19. The ports
welcomed nearly 40,000 ship arrivals from January-May, up 12 percent
year-on-year. This includes 6,169 ships taking domestic routes. The province
now has a total of 60 port terminals, 25 of which are located on Cai Mep –
Thi Vai River, 22 on Dinh River, one in Con Dao, and 10 offshore oil
terminals. The Vung Tau
Port Authority is cooperating with local authorities to undertake preventive
measures against the coronavirus to ensure safety for crewmen, said Director
Le Van Thuc./. Dong Nai’s six-month FDI attraction surpasses yearly target So far this
year, industrial parks (IPs) in the southern province of Dong Nai have
attracted close to 80 foreign direct investment (FDI) projects totally worth
some 715 million USD, exceeding its target of 700 million USD for the entire
year. According to
the provincial IPs management board, 485 million USD were added to 53
existing projects and the remainder, for new projects. Most of the licenced
projects are in the field of support industries, using modern assembly lines
and not labour intensive. Projects
posting large investment included the 100 million USD Hansol Electronics
project at the Ho Nai IP, the 60 million USD plant of the Ojitex company at
the Loc An – Binh Son IP, and an over 130 million USD coffee project by
Nestle Vietnam at the Amata IP. Le Van Danh,
deputy head of the board, said the total FDI attracted in the period was 15
percent higher year on year. Dong Nai is
seeing chances of obtaining more than 1 billion USD worth of foreign capital
this year, equaling its pre-pandemic average level. Danh
attributed the increase in FDI to the local administration's reform that has
simplified procedures and employed digital transaction methods. The province
is home to 32 operating IPs. To date, it has recorded close to 1,400 valid
FDI projects whose value tops 27 billion USD, from 41 nations and
territories./. Dong Thap: IPs, industrial clusters lure over 1 bln USD of
investment The Mekong
Delta province of Dong Thap has attracted 123 investment projects worth over
24 trillion VND (over 1 billion USD) to three industrial parks (IPs) and 16
industrial clusters, according to the provincial Department of Industry and
Trade. Deputy
Director of the department Nguyen Van Na said the occupancy rate in the Sa
Dec, Tran Quoc Toan and Song Hau IPs reached 98 percent. Local
authorities are paying attention to developing IPs and industrial clusters,
and border economic zones with favourable locations, and promoting connection
with neighboring regions and localities such Can Tho, Vinh Long, and Long An,
thus creating a network to catch investment inflows. IPs and
industrial clusters in the locality have seen projects belonging various
industries, especially food, aquatic and animal feed processing. The province
has 20 aquatic processing enterprises operating in IPs, creating jobs for
about 21,000 labourers, contributing to lifting the locality’s processing
industry value to 11 trillion VND in 2020. In the
coming time, local authorities will continue to focus on accelerating
administrative reform, making it easier for investors’ business and
production. Dong Thap is
striving to realise its plan to develop IPs and industrial clusters in the
2021 – 2031 period, with a vision after 2030./. Minister: Vietnam looks towards sustainable agriculture Minister of
Agriculture and Rural Development Le Minh Hoan has pledged to tackle
obstacles to two projects on food safety and hygiene, and sustainable fishery
development, saying that they are urgent to Vietnam’s agriculture. During a
working session with World Bank Country Director in Vietnam Carolyn
Turk on June 23, Hoan said following the 13th National Party Congress,
Vietnam set the goal of developing ecological and sustainable agriculture,
and changed mindset from agricultural production to agricultural economy,
thus creating multiple values. In the
document “Transforming Vietnam’s Agriculture” compiled by the WB in 2016, he
said Vietnam’s achievements and obstacles in agriculture have been pointed
out, along with successful models in the world that Vietnam could learn from. He wished
that Vietnam could receive support and advice from the lender and other
experts during the process of building agriculture ecological system to
spread to other regions, thus improving farmers’ lives. The minister
also called for the WB’s assistance in policy and strategy consultation, and
mechanism renovation so as to fully tap the strength of both public and
private sectors, farming enterprises, as well as farmers and cooperatives. The Vietnamese
Government has issued a resolution on sustainable development of the Mekong
Delta in adaptation with climate change. However, problems regarding the
shift of farming models in adaptation with reduction in water resource and
extreme weather remain, he said, adding that Vietnam also needs the WB’s
support in disaster prevention, and ensuring the safety of dykes and
irrigation infrastructure in service of production, especially clean water
and rural environment. The WB also
needs to work closely with the Ministry of Agriculture and Rural Development
(MARD) to build projects using loans, with priority orientations to fishery,
food safety and climate change adaptation. Turk, for
her part, hoped that ties between the WB and the MARD would be strengthened
in the near future. She added that challenges in the next decade will be
harder than those in the past 25 years. She wants to
partner with Vietnam to develop agriculture with low carbon emissions in the
future. According to
the official, apart from food safety, consumers also favour and are willing
pay high for farm produce with low carbon emissions. She also
proposed cleaning water sources as soon as possible to save costs, saying the
WB is ready to work with the MARD to offer financial assistance to future
projects./. Australian businesses interested in agritech in Vietnam Local
businesses in Australia’s New South Wales (NSW) have shown their interest in
joining the agricultural technology as well as food and beverage sectors in
Vietnam – a promising market in their eyes. Vietnam’s
fast and sustainable growth over the past many years has made the market
attractive to companies in NSW, said Karla Lampe, Director for International
Engagement & Market Development at NSW Treasury at an online conference
held this week to explore business opportunities in Vietnam. She said
that the advantages in population and the increase in the middle-income
people have created more trade and investment opportunities for Australian firms. Lampe said
that Vietnam is currently the ninth largest trade partner of NSW, stressing
that NSW businesses place agritech, food and beverage at the top priority for
investment in Vietnam. Meanwhile,
Rebecca Ball, Australian Deputy Consul-General in Vietnam and Cambodia said
that Vietnam’s attention to agritech development is a great chance for
Australia to engage in the market. According to
Ball, Australia can help Vietnam improve farming productivity, water
resources, animal feeds and pest management, and origin trace through
introducing effective agricultural solutions, thus responding to challenges
in food security and food safety. In the first
quarter of 2021, Australia’s export revenue of farm produce from Vietnam
increased 44 percent year on year, she noted, adding that Vietnam is likely
to become the fifth biggest export market of Australian agricultural products
in the end of 2021 from the current eighth position. At the
event, representatives from numerous of successful businesses in Vietnam and
Australian agencies shared their experience and answered questions regarding
Vietnamese agritech, food and beverage sectors./. Pangasius exports to potential markets skyrocket over five
months Vietnamese
pangasius exports to a number of potential markets, including Mexico, Brazil,
Colombia, Thailand, and Russia, have all enjoyed robust growth during the
opening five months of the year, according to the Vietnam Association of
Seafood Exporters and Producers (VASEP). May alone
saw local pangasius exports to Russia, Colombia, and Mexico increase sharply
by 458%, 230%, and 167%, to US$4 million, US$1.9 million, and US$6.42
million, respectively. VASEP’s data
show Vietnamese pangasius exports to Mexico, Brazil, Thailand, Colombia, and
Russia all witnessed surges of 61.7%, 65.5%, 18.7%, 65.7%, and 124.5% to
US$30.3 million, US$27.2 million, US$25.6 million, US$17.9 million, and US$
16.9 million, respectively, over the reviewed period. Most
notably, China remains the leading consumer of Vietnamese pangasius, importing
the fish worth US$165.5 million over five months, representing an annual rise
of 2.1% and making up nearly 26% of all Vietnamese pangasius exports. Meanwhile,
exports to the US also enjoyed a strong rise of 55.3% to US$134.2 million
during the reviewed period, with high export turnover being recorded in both
April and May. In general,
the country raked in US$637.8 million from exporting pangasius, an increase
of 14.7% against the same period from last year, with turnover reaching
US$148.4 million in May alone, up 39.3%. At present,
the price of raw pangasius in the Mekong Delta region over recent months has
seen a slight increase of between VND21,500 and VND22,000 per kilo, showing
positive signs for the industry after facing a long period of decline. Ca Mau posts growth in shrimp exports despite pandemic Shrimp
exports of the southernmost province of Ca Mau grew in the first half of this
year despite the impact of the COVID-19 pandemic, according to the provincial
Department of Industry and Trade. The province’s
shrimp output was estimated to exceed 107,000 tonnes in the period, a
year-on-year increase of 9.5 per cent, while exports raked in about US$400
million, up 16.6 per cent. This year,
Ca Mau, one of the country’s leading localities in aquatic exports, is
projected to earn more than $1 billion from shrimp shipments. COVID-19 has
been kept under control in the province as well as its traditional markets
such as the US, Europe, China, Japan and the Republic of Korea. Therefore,
demand for the products in the restaurant industry has gradually recovered. In addition,
trade deals like the EU-Viet Nam free trade agreement (EVFTA) and the
Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP)
are hoped to help exporters seek new markets. The province
is home to more than 40 export firms and 32 processing plants serving exports
with a combined capacity of 250,000 tonnes per year. Its shrimp products have
been shipped to 60 countries and territories. Statistics
of the Ca Mau Department of Industry and Trade showed the province’s revenue
from shrimp exports to signatories of the EVFTA surged 148.56 per cent and to
those of the CPTPP rose 9.8 per cent in the first half of the year against
the same period last year. The province
aims to bolster trade promotion via online platforms with foreign
distributors and businesses to search for new partners. It will also support
local firms to offer their products in prestigious e-commerce
marketplaces. Fertiliser exports reach record high Viet Nam
exported nearly 616,000 tonnes of fertiliser for US$213 million from the
beginning of the year to mid-June, up 49 per cent in volume and 1.76 times in
value from the same period last year. Statistics
from the General Department of Customs showed this was the first time the
country saw fertiliser exports hit this record high in both quality and
quantity after more than eight years of shipping fertiliser to overseas
markets. During the
period, Cambodia, Malaysia and Laos were the top importers while the
Philippines and Mozambique markets emerged as promising markets for
Vietnamese fertiliser, the department noted. Trade
experts attributed the period's positive export performance to the fact that
from the end of 2020 some fertiliser manufacturers signed contracts for
delivery in the first quarter of 2021, to reduce their inventories and
balance domestic supply and demand. Previously,
2021 was forecast to be a difficult year for the fertiliser market with a
high inventory of goods, and the possibility of natural disasters, such as
drought in the southwestern, southeastern and Central Highlands regions, as
well as floods in the northern region. Viet Nam is
home to four fertiliser factories, namely Phu My, Ca Mau, Ninh Binh and Ha
Bac, producing about 2.5 million tonnes of urea per year. These factories
sell only 1.8 million tonnes of urea per year, resulting in more than 500,000
tonnes of urea being stockpiled annually, so they have to find ways to export
the excess urea. Nhan Dan
(The People) newspaper quoted Nguyen Thi Hien, Deputy General Director of
PetroVietnam Ca Mau Fertiliser JSC (PVCFC), as saying that as the fertiliser
oversupply situation in the country led to high inventories, PVCFC has made
efforts to seek export outlets such as the Philippines, Cambodia and some
African nations. Thanks to
close geographic location and low logistics costs, Cambodia was the leading
market of PVCFC, consuming between 80,000 and 130,000 tonnes of fertiliser
each year, Hien said. VN fruit, vegetable exports to top record $4b in 2021 Exports of
fruits and vegetables were worth US$2.06 billion in the first six months of
this year, up 17.4 per cent year-on-year, and are expected to reach a record
$4 billion this year. Dang Phuc
Nguyen, general secretary of the Viet Nam Vegetables Association, said
exports would increase sharply this year since importing countries are
recovering economically, leading to an increase in demand. But in the
next few months Thailand, Malaysia, China, and other countries would also
have their fruit harvest season making competition very fierce, he said. New-generation
free trade agreements such as the EU-Viet Nam Free Trade Agreement (EVFTA),
the Comprehensive and Progressive Agreement for Trans-Pacific Partnership
(CPTPP) and Regional Comprehensive Economic Partnership (RCEP) are helping
Vietnamese businesses increase fruit and vegetable exports this year, he
said. The UK –
Viet Nam Free Trade Agreement (UKFTA) that took effect late last year
scrapped taxes on more than 94 per cent of vegetables and fruits, he said. Experts said
to take advantage of opportunities and boost exports, exporters should
improve processing technologies, especially in the post-harvest and packaging
stages, to preserve their products longer and enhance their value. Viet Nam is
gradually expanding exports to the US, EU, Japan, and South Korea, but China
remains the leading market for Viet Nam’s farming, forestry and seafood
products. It accounted
for 64.7 per cent of Viet Nam's fruit and vegetable exports in the first
quarter of this year. The Ministry
of Agriculture and Rural Development has urged the Ministry of Health to
issue safety certificates for drivers transporting agricultural products and
pay attention to deploying a priority mechanism for COVID-19 vaccination, and
the Ministry of Foreign Affairs asked to consider negotiate with bordering
countries on the form of "vaccine passport" for drivers
transporting goods across the border. Viet Nam
hopes that when COVID-19 is brought under control, Chinese experts can come
to re-evaluate the technical processes for its durian. If it gets
approval for official export to China, Viet Nam could become a competitor to
Thailand and Malaysia. Construction of major tourism site begins in Thanh Hoa A ceremony
to launch the construction of a tourism project worth more than VND3.66
trillion (US$159.61 million) took place in Nghi Son Township of the
north-central coastal province of Thanh Hoa on Wednesday. The project,
covering 84.8 ha, is invested by the T&T Group. The site
will have beachfront villas, a five-star hotel, a shopping area, a golf
course, pedestrian zones and recreation facilities, among other amenities. It is hoped
to become a driving force for the socio-economic development of the locality
and surrounding regions, especially creating a chain of tourism sites along
Thanh Hoa’s coastline. The first
phase of the project is set to be completed in October next year and the
entire project will be operational in May 2024. Speaking at
the ceremony, Vice Chairman of the provincial People’s Committee Nguyen Van
Thi spoke highly of efforts and co-operation between the investor and
relevant agencies in land clearance and meeting requirements to carry out the
project against the backdrop of COVID-19. He asked the
local authorities to continue helping the investor address bottlenecks in
terms of land and legal procedures, as well as support local people affected
by the implementation of the project. The T&T
Group was requested to ensure progress and quality of the project in
compliance with regulations. HCM City ensures social distancing does not cause scarcity of
essential goods Supermarkets
in HCM City have assured there will be no short supply of foodstuffs and
other essential goods until the end of the extended social distancing period
on June 30, a deputy director of the Department of Industry and Trade has
said. Nguyen
Nguyen Phuong said his department has drafted plans to provide more than
10,000 tonnes of food daily to consumers and has programmes to connect with
22 provinces to ensure sufficient supply of foods. The supply
of agricultural products such as vegetables and fruits, foods and livestock
and poultry meat from provinces remains smooth, supply is enough to meet
demand and prices are steady, he said. Some 8,000
tonnes of vegetables and fruits are available daily at the Binh Dien, Hoc Mon
and Thu Duc wholesale markets, enough to meet 70 per cent of demand. The
remaining 30 per cent is met by supermarkets and other large distributors. Supply is
abundant Many people
have been rushing to stock up on food, but Phuong said they need not be
worried about any possible shortage. He has
instructed enterprises to enhance online sales to reduce gatherings. Many major
supermarkets have increased supply and worked out long-term plans to ensure
sufficient availability of essential goods. Retailers
and production and business units are also encouraged to offer discounts to
share the burden with consumers amid the pandemic. Nguyen Anh
Duc, general director of the Saigon Union of Trading Cooperatives (Saigon
Co.op), said besides joining the programme to help stabilise prices, it has
also carried out many promotions. From now
until July 10, its Co.opmart and Co.opXtra chains would reduce prices by
25-50 per cent and have buy-one-get-one-free offers on more than 3.5 million
COVID-19-prevention items like cloth masks and hand sanitisers, and more than
10,000 essential items would be sold at discounted prices, he said. The prices
of cooking oil, sugar, rice, packaged foods, and nutritious drinks are
discounted by 20-30 per cent, and those of pork, seafood, vegetables, and
fruits by 15-20 per cent. Big C
supermarket is carrying out the ‘Fruit Festival Programme’ to encourage
customers to buy seasonal fruits from other provinces and support struggling
farmers. On June 19
the city People’s Committee replaced Directive No.15 with Directive No.10 to
make social distancing stricter, banning gatherings of more than three
people, instead of the earlier five, in public places and outside of offices,
schools and hospitals and requiring people to maintain a minimum distance of
1.5 metres in public. It also
closes all non-essential businesses and temporary markets, and requires the
public to refrain from leaving home except for buying food or medicine,
getting emergency care or working in factories. Good corporate governance attracts investments: securities
webinar Good
corporate governance plays an important role in improving companies’
long-term performance, experts said. Pham Hong
Son, deputy chairman of the State Securities Commission of Viet Nam (SSC)
told a webinar on ‘Corporate Governance Code of Best Practices on Tuesday
that “Listed companies are improving their corporate governance.” It would
play an important role in helping them clearly distinguish between ownership,
management and operating roles, he said. In 2019 Viet
Nam launched the Corporate Governance Code of Best Practices with a number of
recommendations on best practices, primarily for public and listed companies. Beside good
practices, which have been incorporated in laws and regulations and adopted
by companies, the code also encouraged companies to go beyond the minimum
legal and regulatory requirements and move towards international best practices. Phan Duc
Hieu, deputy general director of the Central Institute for Economic
Management, said corporate governance at many companies is actually not very
good. For example,
the 2020 Enterprise Law requires separating the positions of chairman and
general director, but hundreds of businesses have still not complied. Delegates
speaking at the webinar agreed that companies with good corporate governance
practices create confidence in investors and so have a competitive advantage
in attracting capital. Besides,
high governance standards contribute to more effective boards and management,
leading to improved decision-making, better operational efficiency and
reduced risks, they said. Do Le Hung,
an independent member of the Vinamilk board, said: “For sustainable
development, there must be good corporate governance. “The
benefits of good corporate governance are very clear. The main driving force
for the adoption of good corporate governance is not only the law or
authorities, but also the perception of a company's leadership and the
requirements of the market and investors. “The
implementation of good corporate governance is a long process of persuasion,
testing, adaptation, evaluation, adjustment, and recognition. There is no
one-size-fits-all formula. Therefore, each enterprise needs to choose the
appropriate steps and ways to do it.” Nguyen
Nguyet Anh, corporate governance expert at the International Finance
Corporation, said this code provides important guidance for Vietnamese
companies seeking to improve their governance practices based on
international standards This, in
turn, would help ensure Vietnamese companies are aligned with their ASEAN and
international peers and remain competitive for long-term growth. Tran Anh
Dao, deputy general director of the Ho Chi Minh Stock Exchange (HOSE) said
the exchange encourages large listed companies to ensure good corporate
governance to attract foreign investors. New
regulations related to corporate governance are included in HOSE’s guidelines
sent to listed companies so that they could assess where they are and try to
implement them, he added. The webinar
was organised by the State Securities Commission of Viet Nam, the IFC and the
Ho Chi Minh and Ha Noi stock exchanges. Brokers stay
upbeat Local and
foreign securities companies are beefing up their presence in Vietnam, with
increasing enthusiasm in the nation’s equity market as they are capitalising
on the resilient growth economy. According to
SSI Research, VCI is among the five largest securities brokerages in Vietnam,
with market share at the Ho Chi Minh Stock Exchange (HSX) of around 7.7 per
cent, declining 0.5 per cent compared to 2019. Its diminishing market pie
could be explained by an increasingly intense competition among local and
foreign-backed securities companies, and VCI’s reliance on investment banking
business – a component which was rather stagnant due to the COVID-19 pandemic
in 2020. The company
expects that investment banking activities will rebound in 2021, with total
value of ongoing deals estimated at $174 million in consumer finance, consumer
goods, and logistics. VNDIRECT
Securities also plans to double its charter capital, which is currently at
$95.8 million by issuing 214.5 million shares to its existing shareholders.
The Hanoi-based company expects the funding source to diversify its business,
especially by increasing its margin loan segment. Likewise, Ho
Chi Minh City Securities Corporation has announced its plan to issue 152.5
million shares for $91.3 million, raising its charter capital by 50 per cent
to over $195.7 million. Similarly, ACB recently agreed to pour another $65.2
million into its securities company subsidiary. SSI –
Vietnam’s largest brokerage – is implementing its proposal to raise capital
to $478 million. Likewise, SHS – SHB’s securities company – is planning to issue
103.6 million shares for its existing shareholders to raise more than $65.2
million. The Board of
Directors of SHS believed that Vietnam’s stock market status will likely be
upgraded in September, which is believed to be a pillar to thrust foreign
appetite forward. Furthermore, cooperation between Vietnam’s HSX and the
Korean Exchange will facilitate a better, more solid trading infrastructure
while providing a synchronous and integrated platform for the entire
Vietnamese stock market. Earlier this
month, Pinetree Securities also inked a $20 million loan contract with
Wooribank’s Hong Kong branch. The 1-year-tenure loan, with preferential
interest rate, is slated to provide additional capacity to Pinetree
Securities to expand its operation in Vietnam’s stock market. In 2019,
South Korean Hanwha Investment & Securities acquired 90.05 per cent in
Hanoi-based online stock brokerage HFT Securities for $4.3 million, then
changed its name to Pinetree Securities. Pinetree
Securities has grown strongly in the past two years and has continuously
attracted customers thanks to its zero-fee policy, low margin interest rate
at 9 per cent. In early
2021, the company raised its charter capital to more than $43.5 million in a
bid to expand its business and promptly respond to customer needs with an
increase in credit limit and portfolio of margin loans. Lee Jun
Hyuck, CEO of Pinetree Securities said, “The additional fund is envisaged to
better facilitate investors’ needs in the context of Vietnam’s stock market
proving its glitter. With the government’s efforts to beef up state
divestment, many listed companies will benefit from ongoing infrastructure
development initiatives.” He added, “The stock market continues to be one of
the most important capital mobilisations of Vietnam’s economy.” Hyuck also
revealed that Pinetree Securities will continue to increase charter capital
for the second time in 2021 to expand operations and best serve customers. In the same
vein, Maybank Kim Eng Securities company unveiled its plan to increase its
capital to $75.9 million from the parent corporation Malaysia-headquartered
Maybank Kim Eng Holdings Ltd. Its most recent capital increase was in 2018. According to
data provider FiinGroup, revenue and profit in the first quarter of 2021 of
listed securities companies increased by 21.4 per cent and 26.7 per cent
on-year, respectively. The explosion of market activity by retail and
inexperienced investors of all flavours is one of the biggest trends in the
stock sector. LienVietPostBank to increase to $523 million of charter capital The State
Bank of Vietnam (SBV) has approved LienVietPostBank (HNX: LPB) to increase
its charter capital to VND12.036 trillion ($523 million). According to
the plan approved by the annual shareholders' general meeting,
LienVietPostBank will issue nearly 129 million shares, equivalent to VND1.29
trillion to pay dividends in 2020 at the rate of 12 per cent. Thereby, the
bank's charter capital is expected to increase to VND12.036 trillion ($523 million)
after the issuance. In addition,
LienVietPostBank also plans to privately issue 66.7 million shares to foreign
investors, 265 million shares for existing shareholders and 35 million shares
under the employee stock ownership plan (ESOP). In 2021, LienVietPostBank
aims to achieve the pre-tax profit of VND3.2 trillion ($139.13 million), up
32 per cent compared to 2020. Total assets are expected at the end of the
year to reach VND282.6 trillion ($12.3 billion), up 16.6 per cent compared to
the beginning. Credit card
balance in the market for economic organisations and residents is planned to
increase by 20 per cent to VND213 trillion ($9.26 billion), capital
mobilisation increased 15 per cent to VND237.8 trillion ($10.34 billion).
With this business plan, LienVietPostBank is expected to pay a dividend rate
of 10 per cent in 2021. At the end
of the first quarter, LienVietPostBank reported a pre-tax profit of VND1.1
trillion (47.83 million), up 84.2 per cent over the same period last year
thanks to the growth momentum from lending, services, and foreign exchange. As of March
31, LienVietPostBank's total assets reached VND245.2 trillion ($10.66
billion), up 1.2 per cent, of which customer loans increased by 3.5 per cent
to VND182.7 trillion ($7.94 billion). Deposits from customers grew modestly
by 0.9 per cent compared to the end of last year. The bank's
bad debts increased slightly to VND2.6 trillion ($113 million), the bad debt
ratio remained unchanged at 1.42 per cent. The bank no longer has bad debts
at Vietnam Asset Management Company (VAMC). On June 23,
Thaiholdings JSC bought 20 million LPB shares raising its ownership to 1.86
per cent. The transaction was made after the company sold all of its shares
in the bank (719,400 shares) on June 16. It is estimated that the amount of
money this company has to spend to make the transaction is more than VND570
billion ($24.8 million). LPB shares
closed the June 24 session at VND29,450 ($1.28). E-cars gear up for policy assistance Not only
VinFast could benefit if it is exempt from taxes and fees as proposed – the
whole auto industry is also holding its breath waiting for policies. The leaders
agreed that there should be strong and drastic solutions to support the
development of electric car production, and Vingroup’s proposal will be
evaluated by the Ministry of Finance for completion. The results
of the meeting showed that VinFast is on the right track with the
government’s wishes. The mission of the car models is more important – that
is, pioneering a new development orientation for the country. About five
years ago, and especially since VinFast started construction of a 335-hectare
complex on the northern city of Haiphong’s Cat Hai Island in 2018, the goal
of developing the automobile industry was aimed towards domestic production
and assembly, while limiting imports. At this
time, when Truong Hai Auto Corporation and Thanh Cong are still focusing on
internal combustion engine vehicles, VinFast is focusing on electric
vehicles, which involves many challenges in terms of both production and
consumption. Estimates by experts around the world showed that the cost of
producing electric cars, compared with traditional internal combustion engine
cars of the same size, is still about 45 per cent more expensive. At the end
of this decade, this figure will decrease to about 9 per cent, still more
expensive to produce. While
electric cars have a simpler structure and are easier to manufacture, what
makes the production cost more expensive than gasoline cars? The answer comes
from the battery pack. Battery costs still account for about 40 per cent of
an electric vehicle. The battery is the soul of an electric vehicle, but car
manufacturers cannot hold this soul on their own, and depend on suppliers. Currently,
many companies are researching solutions to increase capacity and lifespan,
reduce size and charging time, and lower battery cost, but have not been able
to commercialise it at a cheap price. Therefore, car manufacturers must
depend on and accept higher production costs than traditional cars. In return,
with good effects on the environment such as no smoke, no polluting
emissions, and no need for lubricating oil or fuel, environmental experts
said that electric vehicles are an inevitable trend worldwide, and especially
necessary for the environment in Vietnam. Professor
Pham Ngoc Dang, vice president of the Vietnam Association for the Protection
of Nature and Environment, has noted that up to 70 per cent of fine dust in
the air comes from motorbikes and cars using internal combustion engines. In
addition the greenhouse effect and noise pollution are also problems that
electric vehicles will thoroughly solve compared to gasoline and diesel cars. As for
needing more electricity to charge cars, environmental experts said it is
practically controllable. The amount of electricity in Vietnam is currently
generated from 36 per cent hydroelectricity and renewable energy, meaning
processes that do not pollute the environment. Although the majority is
thermal power, with the potential of hydroelectricity and wind and solar
power growing, these issues can be resolved to reconcile all benefits. From an
economic perspective, electric vehicles should also be encouraged. Bui Quang
Tuan, director of the Vietnam Institute of Economics, said that this type of
vehicle should be supported and provided with economic incentives such as
exemption from excise tax and registration fees, as proposed by Vingroup. Tuan
analysed that there will be no need to worry about the budget deficit because
when there are incentives, the car price will be cheaper and sales volumes
will increase. In addition, the electric car industry is an amalgamation of
many other industries, so if electric vehicles develop, the supporting
industry also develops, which can create breakthroughs and solve macro
problems such as employment and income as well as national status. On a
national scale, electric vehicles are the trend and ambition of most
governments, from developed to developing countries. China was the world’s
largest electric vehicle market in 2020 with nearly 1.38 million vehicles
sold. There are
several groups of policies that China and other countries are applying,
including deals for car manufacturers; car-buying subsidies, and
administrative procedures for prioritising electric vehicles. Specifically,
electric vehicle manufacturing companies are supported by the power grid from
state-owned companies, a 30 per cent capital subsidy to build a charging
station, and a subsidy of nearly $8,000 for each vehicle produced. Meanwhile,
people in this country have been supported with 50-100 per cent reduction in
registration fees, and free or very low charging costs. With administrative
procedures, customers using electric cars do not have to wait 6-12 months to
be registered like petrol cars. In Europe,
where Norway was the only country in the world to sell more electric cars
than petrol cars in 2020, the policies are equally rich. Electric car
companies are exempted from a series of taxes such as sales, import, and VAT;
and subsidised 50 per cent of production costs and subsidised charging
station installation costs. Users are supported with nearly $5,000 when
buying a car, though discounts for fast-charging services, free parking, use
of bus lanes, and some road and ferry fees waived. With the
market and economic form closest to Vietnam, Southeast Asian countries such
as Thailand, Indonesia, and Malaysia all have their own policies for electric
vehicles. Based on the level of CO2 emissions to excise tax, electric
vehicles in these countries can be subject to zero or a very small 5 per cent
tax. A
synchronous policy system from production and consumption to use is being
applied by countries to promote electric vehicles and limit petrol cars. The
application of any kind of incentive depends on the reality of the economy
and the state budget as well as the long-term orientations in each place. But
according to experts, in order to popularise new vehicles, it is still
necessary to have separate mechanisms for all processes as other countries
are carrying out. Even if Vingroup’s proposal is approved, it may not be
enough to motivate consumers to buy electric cars. Moreover, if
these incentives are effective but only VinFast makes electric cars, it will
not solve the big picture. So these could be incentives for the whole auto
industry, especially joint ventures, which already have products and research
on this car line. Currently,
almost no car company besides VinFast intends to sell electric cars in the
near future because of concerns about costs, infrastructure, and user habits,
even though Nissan has registered to protect industrial designs for cars. Its
Ariya electric crossover model has been registered for industrial design
protection in Vietnam, while Thanh Cong’s TC Motor also has its own plans for
electric and hybrid vehicles when its factory in the northeastern province of
Quang Ninh comes into operation. But when
these proposals come to fruition and there are more attractive incentives,
companies may have to accelerate the progress of bringing electric vehicles
to Vietnam. If the platter is prepared, and it is full of delicious dishes,
whoever is late will lose their share, said one vehicle industry strategist. When
electric cars from Toyota, Honda, Mitsubishi, Ford, and more are produced in
Vietnam, the beneficiaries will be customers. Many companies can change the
system together and obstacles decrease with customer numbers, the strategist
said. As for the government, the problem of environmental pollution opens up
part of a simple answer, which is a move towards more electric
vehicles. Deeper funding key for agri-processing As the
oversupply of raw agri-products has been threatening local farmers and
exporters, especially amid logistical issues caused by COVID-19, plans for
deeper processing and added value are targeted by most stakeholders, aiming
to transform Vietnam into one of the world’s most important agri-product
hubs. During the
current lychee season, local authorities and management agencies have
mobilised stakeholders to ensure output of fresh lychees and minimise
negative effects on farmers. The Ministry of Industry and Trade said that
Vietnam has exported about 100 tonnes of fresh lychees to Japan, the US,
Australia, France, the Czech Republic, and China this season. In 2020,
exported lychees got stuck at the border gates in large quantities, causing
damage to businesses. Thus, the Ministry of Agriculture and Rural Development
(MARD) has been more proactive amid this year’s lychee crop as the resurgence
of the pandemic could lead to the isolation of some lychee-growing provinces. The MARD has
established working groups to support provinces in accelerating customs
clearance for products. It also sent dispatches to relevant ministries to
seek cooperation and promote the trade flow of agri-products in the peak
season. Some measures have been adapted to facilitate the transport of
agri-products including an extension of the working time, eased
administrative procedures, reduced transportation fees, and the issuance of
certificates for disease safety. Another measure has been to diversify
distribution channels by selling agri-products on e-commerce and digital
platforms. However,
these are all just short-term solutions to increase the output for
agri-products. In the long term, Vietnam may need to invest heavily in deep
processing to help farmers avoid falling prices despite the bumper harvest
seasons. According to the government’s Resolution No.53/NQ-CP dated July 17,
2019 on solutions to encourage and promote enterprises to invest in
agriculture, Vietnam aims to be among the top 15 countries with the most
advanced agriculture worldwide, and among the world’s top 10 in terms of
processing by 2030. Post-harvest
processing is also crucial to increase value of agri-products and reduce
losses, helping businesses actively find consumption markets and earn higher
revenue. However, since 2017, localities have attracted only around 70
projects in agri-forestry-fishery processing, with total capital of $2.56
billion. Meanwhile,
fishery by-products are a valuable source of raw materials for processing
value-added products. Vietnam’s total seafood output reaches about seven
million tonnes per year, of which fishery by-products account for about 15-20
per cent (about one million tonnes). Phan Thanh
Loc, vice chairman of Vietnam Food JSC, said that many developed countries
soon realised the potential of the industry and successfully developed
high-added value seafood by-products. He said Vietnam has a target of $10
billion for shrimp exports by 2025 with a total shrimp output of over 1.15
million tonnes. However, only 55-65 per cent of the shrimp’s value has been
exploited while the remaining 35-45 per cent is often discarded. MARD
Minister Le Minh Hoan said at a conference last week that only 20-30 per cent
of Vietnam’s agri-products are processed before being sold to the market.
Meanwhile, this figure is nearly 80 per cent in Taiwan. “Thus, the sector
needs to compare and formulate a development plan to create added value for
agri-products, meant to solve the oversupply issue and reduce pressure on
farmers,” Hoan said. According to
Hoan, the government needs to work with businesses to connect them with
consumers as well as conduct more research. It is also necessary to pay more
attention to cooperatives and also smaller players in order to promote
logistics, post-harvest preservation, and processing technology. Long An’s economic growth in H1 ranks third in Mekong Delta Long An
province posted high growth in the first half of 2021 despite the negative
impact of COVID-19, coming third amongst 13 Mekong Delta localities,
according to the provincial People’s Committee. The province’s
economy expanded 6.06 percent in H1, higher than the 4.34 percent recorded in
the same period last year. The outcome
made Long An rank fourth amongst eight cities and provinces in the country’s
southern key economic region. Of note, a
number of industrial sectors have seen signs of recovery, as the index of
industrial production rose 7.5 percent year on year. Power production and
distribution increased 14.9 percent and construction 10.4 percent. In the
period, Long An authorities handed over investment licences to 77 domestic
projects with a registered capital nearing 5.6 trillion VND (243.44 million
USD), and 30 foreign ones worth over 3.2 billion USD. The
provincial People’s Committee asked relevant agencies to continue realising
the dual targets of curbing the spread of COVID-19 and bolstering
socio-economic development./. Source:
VNA/VNS/VOV/VIR/SGT/Nhan Dan/Hanoitimes |
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