VIETNAM BUSINESS NEWS JULY 31
09:35
July retail sales plunges nearly 20% due to COVID-19
Total retail sales of goods and
services shrank 8.3 percent month-on-month in July to 14.84 billion USD as a
result of restrictions induced to stem the ongoing COVID-19 outbreak. Total retail
sales of goods and services in the first seven months of this year
exceeded 121 billion USD, up 0.7 percent year on year. The Ministry
of Industry and Trade is formulating specific plans to stimulate consumption
and sustainably develop the domestic market./. Vinamilk posts record high net revenue in Q2 2021 The Vietnam
Dairy Products JSC – Vinamilk, the largest dairy company in Vietnam, posted a
record high in net revenue of 15.71 trillion VND (682.57 million USD) in the
second quarter of 2021, a year-on-year rise of 1.4 percent, according to its
financial report. The figure
also rose by 19.2 percent compared to the previous quarter. The company’s
after-tax profit exceeded 2.86 trillion VND in the period, a year-on-year
decline of 7 percent but up 10 percent against Q1. It raked in
13.25 trillion VND in net revenue in the domestic market, surging 18.5
percent against the previous quarter. A report by
Kantar WorldPanel showed that Vinamilk maintained its lead as the
most-favoured dairy brand in Vietnam in 2020 and ranked first in the sale of
fast-moving consumer goods for the fourth consecutive year. In Q2 2021,
the dairy firm launched its Vinamilk Green Farm system in the provinces of
Tay Ninh, Quang Ngai and Thanh Hoa. Its
affiliate Moc Chau Milk earned 790 billion VND in net revenue, up 7.6 percent
against the same period last year and fulfilling 56 percent of its yearly
target. Vinamilk
posted a net revenue of nearly 1.61 trillion VND in exports, a year-on-year
increase of 17.2 percent. The Middle
East continues to be its largest export market, along with others of the US
and China./. Banks to tighten credit in risky sectors in remaining months of
this year Banks will
continue to tighten lending in risky sectors including securities, real
estate, financial, and tourism business, seeing higher credit risks in the
remaining months of this year, a survey carried out by the Monetary
Forecasting and Statistics Department has said. The survey
included 95 percent of credit institutions and branches of foreign banks
operating in Vietnam. The survey
found that credit institutions saw an increase in overall credit demand in
the first half of this year and forecast the trend would continue in the
second half. Only credit demand from tourism businesses dropped in the first
half but it was expected to see a slight recovery in the second half. Credit risk
was seen to increase in the first half of 2021 but at a lower rate than the
second half of 2020 in almost all sectors. However, securities, real estate,
financial and tourism businesses were considered sectors with higher credit
risk in the pandemic. Banks said
that they intended to tighten lending for securities, real estate, financial
and tourism business in the remaining months of this year but loosen credit
criteria for enterprises, especially those of small and medium-sized
enterprises, on positive economic prospects, improved financial capacity of
credit institutions, and the Government’s drastic measures to fight the
virus. Retail and
wholesale, import and export and lending for living expenses were the major
drivers of credit growth in the first half of this year and would continue in
the remaining months of this year and next. State Bank
of Vietnam statistics showed that total outstanding loans were estimated to
be more than 9.6 quadrillion VND (414 billion USD) as of the end of May and
banks pumped a net value of more than 455 trillion VND into the economy
through lending channels in the first five months of this year. Trade and
industry were the two sectors with the highest outstanding loans, worth more
than 2.22 quadrillion VND and 1.84 quadrillion VND respectively. Credit for
trade saw a growth rate of 5.73 percent while industry had a 6.73 percent
growth rate, higher than overall credit growth of 4.95 percent in the first
five months of this year./. Vietnam in the top 10 emerging markets for global data centres Vietnam is
rated one of the 10 emerging markets in the global data centre market, with
impressive growth, international standard service delivery capacity, and a
large number of organisations and enterprises, research firm
ResearchAndMarkets has said. The
Vietnamese data centre market stood at 858 million USD last year and is
forecast to grow at a compounded annual growth rate of over 14.64 percent
until 2026. The growth
in the Vietnamese data centre market was driven by government projects and
initiatives, the report said. Data
protection is a matter of global concern and is becoming an important issue
on the agenda of the Vietnamese Government. The data
localisation requirement under the Cybersecurity Law, plus the need for
better processing speeds to assist Vietnamese users are the main drivers,
which are anticipated to significantly enhance the demand for data centres in
the country. The
Vietnamese Government's inclination toward digitisation has further bolstered
the demand for data centres across the country. Furthermore,
the Vietnamese data centre market is driven by the shifting of enterprise
data to cloud platforms. This has led to an increase in the adoption of data
storage solutions, which in turn is expected to positively influence the
growth of the market. Additionally, growing adoption of big data solutions,
IoT and cloud-based solutions among others, is expected to propel market
growth through 2026./. Deputy minister stresses significance of processing,
manufacturing sector The
processing and manufacturing sector is a prerequisite to improve capacity for
industrial firms and those operating in supporting industries in particular,
Deputy Minister of Industry and Trade Do Thang Hai has said. In an
interview granted to the Vietnam News Agency, Hai said Vietnam should foster
its processing and manufacturing sector to open up market opportunities for
businesses operating in supporting industries, helping them become suppliers
and join supply chains. The State
should play a more active role in expanding the market for the firms, the
official said, explaining that they should learn from foreign countries’ technologies
and production experience. Hai also
suggested policies to orient social resources towards production, and the
allocation of resources to processing and manufacturing enterprises, thus
enabling them to meet regional and international standards, and optimise free
trade agreements. Under
Resolution No. 115/NQ-CP, Vietnam aims to be able to churn out supporting
industrial products with high competitiveness by 2025, meeting 45 percent of
the essential production and consumption demands at home, and making up
around 11 percent of the total industrial value. By 2030,
supporting industrial products are expected to satisfy up to 70 percent of
the domestic demands, and account for about 14 percent of the accumulative
value. To that end,
the Ministry of Industry and Trade will continue its coordination with other
ministries, agencies, localities and concerned organisations to speed up the
building of relevant mechanisms and policies to create a comprehensive legal
framework for industrial growth. Hai said the
ministry will also step up international cooperation, maximise the support of
international organisations and foreign countries to raise personnel quality,
transfer technologies, improve competitiveness of domestic firms, create
connectivity and exchange opportunities between domestic and foreign
enterprises, and further join the global production chain. Asked about
priorities in the time ahead, the official said during the 2030-2045 period,
Vietnam will focus on developing new generations of IT and telecom, promoting
digital technology, automation, high-end equipment, new materials and
bio-technology. The
Politburo’s Resolution No. 23-NQ/TW has also ordered great attention to seven
major policy groups to boost priority for processing and manufacturing industries. The groups
cover industrial structure transformation, development of priority
industries, investment environment, corporate development, personnel
development, science and technology, natural resources exploitation,
environmental protection, and climate change adaptation during industrial
development. Stable
supporting industries and restructuring of chains for industrial production
are crucial to improving the country’s manufacturing sector, according to
Vietnam Chamber of Commerce and Industry (VCCI). The
organisation has worked out a plan to develop appropriate policies for
supporting industries towards minimising reliance on the import of raw
materials as well as reducing prolonged, simple and low-value-added processes
like packaging and plastic components. This will
enable Vietnam to not only create more value and put the country in a better
position in the global supply chain, but also create more opportunities for
Vietnam in terms of free trade agreements (FTAs). According to
the VCCI, high dependence on imports for supporting industries will lead to
higher risks and increase the costs for enterprises. Dau Anh
Tuan, Director of VCCI’s Legal Department, said Vietnam's COVID-19 response
could make it an attractive investment destination as economies seek to make
their supply chains less dependent on other countries. Foreign
investors were considering shifting investments to Vietnam due to their trust
in the country's safety amid the pandemic. With a number of new generation
FTAs, Vietnam would have more opportunities if the Government could offer
better policies and clear targets to encourage and create favourable
conditions for Vietnamese businesses and attract foreign investment into
prioritised manufacturing sectors, they said./. Vietnam ranks third in logistics performance index in ASEAN Vietnam
ranks 39th among 160 countries and territories, and third in the Association
of Southeast Asian Nations (ASEAN) in logistics performance index (LPI),
heard a workshop held by the Ministry of Industry and Trade (MoIT) on July
30. The country
is also placed among the top emerging markets with a growth rate ranging from
14-16 percent, Deputy Minister of Industry and Trade Tran Quoc Khanh said. The official
highlighted in an increase in the number of logistics firms, and improved
logistics services, saying they are the outcomes of efforts made by both
businesses and the Government. Tranh Thanh
Hai, Deputy Director of the MoIT’s Agency of Foreign Trade, said Vietnam’s
total export-import revenue in the 2010-2020 period tripled the value
recorded earlier. The
logistics sector plays a significant role in the national economic
development, including export-import activities, goods circulation at home
and production, the official said. He stressed
the significance of logistics services in such localities as Ba Ria-Vung Tau,
Ho Chi Minh City, Hai Phong, Hanoi and Da Nang, saying they serve as momentum
for regional and local socio-economic development. Hai affirmed
that the Government, ministries, agencies and businesses have always paid
attention to cutting logistics costs to improve competitiveness of the
country and enterprises in particular. Experts at
the workshop shared the view on the need for the logistics sector to develop
high-quality personnel, step up IT application and modernise its management
and operation methods to reduce costs and improve service quality. Vietnam’s
logistics sector is expected to contribute 5-6 percent to the country's GDP,
record a growth rate of 15-20 percent and rank 50th in the global LPI by
2025./. US concludes anti-dumping investigation into Vietnam’s OCTG The US
Department of Commerce (DOC) has announced the results of the third
administrative review for Vietnam’s oil country tubular goods (OCTG) for the
period from September 1, 2018, to August 31, 2019, according to Trade
Remedies Authority of Vietnam under the Ministry of Industry of Trade. OCTGs are
essentially tubes that are used in oil and gas production. In the
conclusion, the DOC determined that the tariff for SeAH Steel VINA
Corporation (SSV) is zero percent. Other manufacturers and exporters of
Vietnam receive a 111.47 percent tariff. This result is similar to previous
reviews. The US data
also showed that last year the export turnover of OCTGs to this market
reached approximately 17 million USD, mainly from SSV. If new
enterprises want to export OCTGs to the US, they can ask the DOC to review
under the new exporter mechanism to enjoy separate tariffs, said Trade
Remedies Authority (TRA). The
enterprises are advised to contact the Foreign Trade Remedies Handling Office
under Trade Remedies Authority to receive more support on the review process
and procedures in line with the new exporter mechanism. According to
TRA, the US initiated an anti-dumping investigation into OCTGs from Vietnam
in 2013 and issued the final determination in 2014 with the anti-dumping rate
for Vietnamese enterprises ranging from 9.57 percent to 111.47 percent./.  Indian newspaper: Vietnam emerging as post-pandemic economic
power in region Vietnam and
India are emerging as economic powers in the region that will make a
difference in the post-pandemic times, The Economic Times cited Indian
Ambassador to Vietnam Pranay Verma as saying. The
ambassador was speaking at a recent webminar on global trade and investment
opportunities for Indian industry in Vietnam organised by India’s PHD Chamber
of Commerce and Industry (PHDCCI). Vietnam and
India have emerged as global trade partners due to their policy initiatives
and increase in their trade and investments, he said. While
applauding PHDCCI’s diligent efforts in fostering business and trade
relations of India with other countries of the world, Verma discussed
challenges faced in Vietnam related to disruption in production, supply
chain, logistics, and many more yet at the same time arising of new
opportunities in areas of technology, business practices, trade relations,
diversifying partners and trade baskets. Verma
emphasised that there is a need for Vietnam and India to take advantage of
each other’s economic strength for increasing business relations between the
two nations, at the same time leverage each other’s global value chains to
utilise each other’s trade network. There is
also a need to look at the domestic market, especially in India that can
offer growth opportunities to Vietnam with focus on e-documentation and
e-payments which help to increase business growth and foster B2B engagement,
connecting MSMEs. There is a
need for structural improvement where the government and business partners
need to work in sync and also improve shipping connectivity between the two
nations. He further
added that mutual recognition of standards and certifications will have a
positive impact on the trade and electrical machinery vertical. Counselor Do
Thanh Hai spoke about the flow of economic and trade opportunities between
Vietnam and India despite the pandemic, saying the economic and trade
exchange will pick up in the time to come. There is a
restructuring of the global supply chain and both nations have the
capabilities to take advantage of the opportunity. With the strategic
location of both nations and change in reforms, there will be an increase in
trade exchange and will be a driving engine for the global economy in near
future, he said./. EVFTA fuels Vietnam’s imports from EU Since the EU
- Vietnam Free Trade Agreement (EVFTA) took effect, the country’s imports
from the EU have been rising sharply, with many commodities posting import
value of billions of US dollars. The EVFTA,
which took effect on August 1 last year, has given an impulse to bilateral
exportation and importation, with Vietnam currently recording trade surplus
with the EU. In the first
half of 2021, the country’s exports to the EU stood at 19.3 billion USD while
imports from this bloc grew 17.2 percent from a year earlier to 8.14 billion
USD. The import turnover was 14.65 billion USD in 2020, up 4.3 percent year
on year. The largest
EU exporters to Vietnam consist of Germany, Italy, France, the Netherlands,
Spain, Belgium, Sweden, and Ireland, which accounted for 85 percent of the
country’s total imports from the EU last year. Computers,
electronic products and components; machinery, equipment, tools, and spare
parts; along with pharmaceutical products are the main groups of items with
billions-of-USD imports from the EU. They saw respective import turnover of
4.1 billion USD, 3.1 billion USD, and 1.75 billion USD last year, according
to the General Department of Vietnam Customs. The
importation of meat and dairy products is also expected to increase strongly in
the time ahead thanks to the EVFTA. The Ministry
of Industry and Trade said under the deal, Vietnam eliminated import duties
on 48.5 percent of the tariff lines, equivalent to 64.5 percent of the EU’s
exports to the country, as soon as the agreement took effect. After that,
91.8 percent of the tariff lines, equivalent to 97.1 percent of the bloc’s
exports, will have their import duties removed in seven years. For the
remaining 1.7 percent of the tariff lines, Vietnam will gradually lift duties
in more than 10 years or apply the tariff-rate quota regime under the World
Trade Organisation (WTO) commitments. At present,
agricultural and aquatic products, consumer goods, processed food, milk, and
dairy products from the EU have yet to benefit from zero-percent tariffs in
Vietnam. As livestock products hailing from the EU are still subject to the
tax rate ranging 10 percent - 40 percent, imports of these commodities have
grown but not at a fast pace. However,
import duties on the EU’s frozen pork, other types of pork, and chicken will
be slashed to zero percent in seven, nine, and 10 years, respectively, since
the EVFTA enforcement. Beef will enjoy this tax rate, from 20 - 30 percent at
present, in the next three years. Vietnam
currently ranks 17th among trading partners of and 11th among exporters to
the EU./. Webinar highlights Canada-ASEAN connections in business,
education Experts from
Canada and ASEAN member countries as well as leaders of businesses of both
sides gathered at an online conference on July 29 by York University's Centre
for Asian Studies to discuss the Canada-ASEAN connectivity, especially in
business and education. Participants
highlighted the Canada-ASEAN relations in business and education and sought
ways to further deepen their collaboration. Rhonda L.
Lenton, President of York University reaffirmed commitments to expanding
partnership with ASEAN as well as hope to explore new cooperation
opportunities. Meanwhile,
Vietnamese Ambassador to Canada Pham Cao Phong underlined the high cooperation
potential between ASEAN and Canada in various fields. He expressed
his hope that connections among leading businesses of both sides will lie not
only in trade and supply chains but also in investment, especially in the
fields of green energy and climate change-related industries, thus completing
the goal of developing green and sustainable economy. Businesses
from ASEAN and Canada should focus on making full use of existing agreements
such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership
(CPTPP), he suggested. The
Vietnamese diplomat also proposed that the two sides strengthen collaboration
in vocational training and giving training courses on economic laws to
enterprises of both sides. With more
than 20,000 students studying in Canada, Vietnam is the fifth largest country
in the number of students in the country, he noted. He held that ASEAN and
Canada should strengthen activities to promote each other's tourism. Ambassador
Phong thanked Canada for its commitment of 3.5 million CAD to the ASEAN
COVID-19 Respond Fund in the next five years. He asked Canada to support
struggling ASEAN countries in dealing with the fourth COVID-19 wave. As a
dialogue partner of the ASEAN since 1977, Canada has contributed important
resources to narrow development gap in the region. Since 2000, Canada has
offered nearly 3.7 billion CAD to support development in ASEAN and its member
countries. Trade
between Canada and ASEAN reached 26.6 billion CAD in 2020, a slight drop
compared to 27.2 billion USD in 2019 due to COVID-19 impacts. ASEAN is the
fifth largest trade partner of Canada in 2020. For his
part, Richard Le Bars, head of the Canadian Mission to ASEAN, said that
Canada is seeking ways to launch negotiations on a free trade agreement (FTA)
with ASEAN. A bilateral
FTA can bring considerable benefits to both sides, not only in trade and
investment but also in people-to-people exchange and education. Leonard F.
Hutabarat, Indonesian Consul General to Toronto, said that there is high
potential to boost trade between Canada and 10 ASEAN member countries where
the middle class is growing and developing infrastructure is offering
numerous opportunities for investors. At the
conference, participants also highlighted the valuable chances that may be
brought from the close Canada-ASEAN relationship, while providing foundations
allowing governments, universities and officials of Canada and ASEAN member
countries to share information and foster partnership./. ASEAN-China trade surges 85 times in 30 years Trade
between China and the Association of Southeast Asian Nations (ASEAN) has
skyrocketed by 85 times since the two sides established their dialogue
relations 30 years ago. Ren Hongbin,
Chinese assistant minister of commerce was quoted by Xinhua News Agency as
saying at a press conference on July 29 that China has remained ASEAN's
largest trading partner for 12 consecutive years. Last year, ASEAN also
became China's largest trading partner. In the first
half of this year, bilateral trade continued robust expansion, registering a
38.2 percent year-on-year growth, he noted. On the
investment front, ASEAN has become one of China's major outbound investment
destinations and sources of foreign direct investment, with cooperation
booming in sectors such as manufacturing, agriculture, infrastructure,
high-tech, the digital economy, and the green economy. Mutual
investment between China and ASEAN exceeded 310 billion USD as of June 2021,
while the business revenue of Chinese enterprises from project contracts in
ASEAN countries reached 350 billion USD. Looking
ahead, Ren said China would actively promote economic and trade ties with
ASEAN by enhancing cooperation against the COVID-19 pandemic and jointly
pushing forward the implementation of the Regional Comprehensive Economic
Partnership (RCEP) agreement. The 18th
China-ASEAN Expo and China-ASEAN Business and Investment Summit will be held
from September 10 to 13 in Nanning, the capital of south China's Guangxi
Zhuang Autonomous Region. With an
exhibition area of 124,000 square meters, the expo this year will set up a
special area for RCEP members and invite more countries and enterprises to
take part, according to Liu Hongwu, Vice Governor of Guangxi Liu Hongwu./. Vietnamese, Japanese firms shake hands in affordable housing
project in Long An The
Vietnamese real estate developer Nam Long Group has partnered with Japan's
Nishi Nippon Railroad Co. Ltd in the EHome Southgate housing project in the
Mekong Delta province of Long An. In its
announcement on July 29, Nam Long Group said that this is the first time the
Japanese firm has teamed up with the company in developing an affordable
housing project with the price of an apartment at about 1 billion VND (43,565
USD). Tran Xuan
Ngoc, General Director of the Nam Long Group, said that although the EHome
products do not bring Nam Long as much profit as those belonging to other
segments. The firm is delighted to share with Nishi Nippon Railroad a common
mission and vision in creating the valuable living environment and products
for the community. Meanwhile,
Fukumori, chief representative of Nishi Nippon Railroad, said that Nam Long
and Nishi Nippon Railroad have jointly developed six projects from small to
large scales. EHome is a
highly appreciated affordable apartment product line of Nam Long. This
product line has an average price of about 1 billion VND with three core
values: Economy (affordable), Ecology (green living environment), Efficiency
(effective design). Nam Long
introduced the product line for the first time in 2007. Since then, EHome has
realized the dream of having a house for 5,000 households with income of
10-15 million VND per month. The EHome
Southgate, which covers 4.5 hectares of land in the area, was designed to
have seven apartment blocks, equivalent to more than 1,400 apartments. The
project is expected to have a synchronous utility infrastructure system and
easily connect to the infrastructure of the competed Waterpoint River area. Online sales
of the project will start in the third quarter this year./. Source:
VNA/VNS/VOV/VIR/SGT/SGGP/Nhan Dan/Hanoitimes |
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