VIETNAM BUSINESS NEWS AUGUST 4
15:15
Coca-Cola in Hanoi suspends operations after reporting
one Covid-19 case
Beverage manufacturer Coca-Cola in
the outlying district of Thuong Tin in Hanoi has temporarily suspended its
operations after a worker at the firm tested positive for Covid-19, reported
Saigon Times. Kieu Xuan
Huy, chairman of the district’s government, today, August 3, confirmed that
the district has reported another coronavirus case, who is a worker at
Coca-Cola. He resides in Tu Hiep Commune, Thanh Tri District, in the capital
city, Nguoi Lao Dong newspaper reported. Earlier, the
worker went to the Thang Long Hospital for a medical check-up after he
developed symptoms of fever and a cough on August 1. He underwent a Covid-19
test at the hospital and the result came back positive. On being
notified of the case, the district’s authorities at night on August 1 asked
Coca-Cola to suspend production as Covid-19 preventive measures. The local
competent forces discovered around 30 people of the firm were linked to the
infected worker. They disinfected the firm and coordinated with the relevant
agencies to conduct contact tracing work. Data from
the Department of Health in Hanoi showed that from 6 p.m. yesterday to this
morning, the city reported 29 new cases, including 21 cases in quarantine
areas and eight other cases whose source of transmission remains unknown. In the
fourth wave, which began in late April, the capital city has reported 1,374
infections. Proposed steel import tax reduction to threaten domestic
steel production: VSA Reducing the
import tax for construction steel products will threaten domestic steel
production, the Viet Nam Steel Association (VSA) has said. In a draft
of a decree submitted to the Government in mid-July to amend and supplement
Decree 57/2020 on the Preferential Import-Export Tariff, the Ministry of
Finance (MoF) proposed reducing the import tax for construction steel but
increasing the export tariff for steel billets. According to
the draft, the import tax for some construction steel products will be cut to
10-15 per cent from a range of 15-25 per cent. The import
tax reduction will contribute to lowering the price of construction steel
products helping businesses to reduce their costs, the MoF said, adding that
a recent steel price increase had affected several projects, especially
public investment projects. Meanwhile,
the ministry has proposed increasing the export tariff for steel ingot from 0
per cent to 5 per cent. This export
tax increase is aimed at stabilising the supply of steel billets for the
domestic market, leading to stability in steel prices and limiting the export
of steel billets for domestic steel production, according to the ministry. Nghiem Xuan
Da, VSA chairman, said the reduction of the import tax for construction steel
was unnecessary as domestic steel production can meet local consumption and
export demand. Local steel producers were also facing a number of COVID-19
related challenges. "Import-export
tariff policies are long-term policies to boost the domestic manufacturing
sector, including the steel industry. Therefore, the Government needs to have
a consistent policy to protect domestic production," Da said. VSA and
other large steel producers such as Viet Y Steel, Kyoei Viet Nam Steel,
Phuong Nam Steel Sheet, Hoa Sen, Fomosa Ha Tinh and Hoa Phat have sent
documents to the Government raising a number of challenges with implementing
the new tariffs. They have
proposed the MoF and relevant agencies consider not increasing the export tax
rate for steel ingot and not reducing the import tax for finished steel products. According to
VSA, since the outbreak at the end of April 2021, special distancing measures
have forced a number of construction activities to be suspended, leading to a
decrease in domestic steel consumption. Specifically,
sales of finished steel products in June on the domestic market decreased by
20 per cent month-on-month but increased only 1 per cent year-on-year. Exporting
steel is one solution to maintain production, and ensure jobs for workers.
This will help to maintain economic development and bring in revenue for
businesses, according to the association. Many steel
enterprises believe that they will have more difficulty and face the risk of
having to stop production or even file for bankruptcy if the proposal is
approved. They said
steel prices had been decreasing and were gradually stabilising, but sales
volume was still slow and steel product inventories were increasing. As a
result, many steel production enterprises had cut output by up to one third. Steel prices
were not only increasing in Viet Nam but also all over the world. The
increase was expected to be short-term and the State should not use tax
policy to deal with these short-term price fluctuations, a Hoa Sen Group
representative said. According to
Nguyen Phu Duong, representative of the Viet Trung Minerals and Metallurgy
Company (VTM), domestic construction demand has sharply reduced due to the
COVID-19 pandemic, and the consumption of construction steel, for most
brands, has been at a record low. The domestic
market has almost no demand for steel billets, while their selling price has
decreased to near-production cost. Therefore, steel billet manufacturers must
export their products to maintain their operations. If the steel
billets export tax is increased, manufacturers will face difficulty in
selling their products. According to
a VSA report, steel ingot consumption in June reached more than 1.5 million
tonnes, down 13.5 per cent month on month. Of which, steel ingot exports
reached only 110,000 tonnes, down 66.7 per cent year on year. Bank stocks recover, VN-Index rises Viet Nam’s
stock market settled higher on Tuesday as more investors returned to riskier
assets in the afternoon trade. The market
benchmark VN-Index on the Ho Chi Minh Stock Exchange (HoSE) jumped 18.22
points, or 1.39 per cent, to 1,332.44 points. The index had climbed for seven
consecutive sessions and broke over the 1,330 point-level. The market’s
breadth was positive as 243 stocks increased while 140 fell. The
liquidity was also higher than yesterday with nearly VND21.5 trillion
(US$935.2 million) poured into HoSE, equivalent to a trading volume of 647
million shares. The index’s
breakthrough was driven by pillar stocks in real estate sectors. The
VN30-Index, which tracks 30 biggest stocks in market capitalisation on the
southern bourse, jumped 1.5 per cent, or 21.66 points, to 1,469.87 points. Vingroup SJC
(VIC) still led the market’s trend, up 6.51 per cent, followed by Vinhomes
JSC (VHM), up 2.59 per cent. The
benchmark got more support from bank stocks in the afternoon trade as these
stocks claimed back some losses from the morning session. Many bank
stocks recorded rises of more than 1 per cent, including Vietcombank (VCB),
Techcombank (TCB), JSC Bank for Investment and Development of Vietnam (BIDV,
BID), MBBank (MBB) and Vietinbank (CTG). Analysts
from Saigon - Hanoi Securities JSC (SHS) said that investors, who were
already bottom fishing on July 19 when the market corrected back to the
support zone of 1,260 points and took profits last Friday and earlier this
week, should continue to watch and take short positions when the market moves
up. On the Ha
Noi Stock Exchange, the HNX-Index also finished higher yesterday on bullish
sentiment. The index jumped 1.33 per cent to 319.13 points. During
Tuesday's trade, over 113.6 million shares were traded on the northern
market, worth nearly VND3 trillion. The
UPCOM-Index reversed the morning course, climbing 0.27 per cent to 87.59
points. In the morning trade, the index fell 0.22 per cent. On the other
hand, foreign investors’ interest in the country's market was intact as they
were still net buyers on both exchanges with a total value of VND169.75
billion. Accordingly,
they net bought a value of VND160.6 billion on HoSE, and a value of VND9.15
billion on HNX. Shares finish higher, foreign investors net buy at the beginning
of new month The market
ended higher on Monday, boosted by gains in large-cap stocks, with foreign
investors continuing to net buy on both main exchanges. The VN-Index
on the Ho Chi Minh Stock Exchange (HoSE) rose 0.32 per cent to 1,314.22
points, expanding last week’s rally. The index finally surpassed the
threshold of 1,300 points last Friday and gained 3.2 per cent for the week. The market’s
breadth was positive as 210 stocks increased while 167 declined. The
liquidity continued to improve with nearly VND19.8 trillion (US$861 million)
poured into the southern bourse, equivalent to a trading volume of 614.5 million
shares. The gain was
still driven by big stocks in all sectors. Accordingly, the 30 biggest stocks
tracker VN30-Index witnessed an increase of 0.07 per cent to 1,448.21 points. Fifteen
stocks of the VN30 basket climbed while 15 fell. Of the top
five stocks influencing the bullish trend, PetroVietnam Gas JSC (PVGas, GAS)
led the gain on Monday, up 4.35 per cent. It was
followed by JSC Bank for Investment and Development of Vietnam (BIDV, BID),
Mobile World Investment Corporation (MWG), Masan Group (MSN) and Vietnam
Airlines JSC (HVN). All these stocks jumped at least 1.64 per cent yesterday. Other big
stocks also recorded good performance such as FPT Corporation (FPT), up 1.7
per cent, and Vietjet Aviation JSC (VJC), up 2.21 per cent. However the
gain was capped by some profit-taking activities, mostly in bank stocks.
Vietcombank (VCB) posted the biggest lost in market capitalisation, down 1.02
per cent. Vietinbank (CTG) and Asia Commercial Joint Stock Bank also lost
1.66 per cent and 1.89 per cent, respectively. On the Ha
Noi Stock Exchange (HNX), the HNX-Index also finished higher on Monday, up
0.03 per cent to 314.93 points. During the
session, over 107.6 million shares were traded on the northern bourse, worth
more than VND2.6 trillion. Meanwhile,
foreign investors continued to be net buyers on both exchanges with a net
value of VND301.34 billion. Of which, they net bought a value of VND296.85
billion on HoSE, and a value of VND4.49 billion on HNX. Foreign
investors net bought in the last trading week of July. In general, they
bought 176 million shares, worth over VND8.2 trillion, while selling 168
million shares, worth nearly VND7.5 trillion. Therefore, they net bought 8.4
million share, worth VND723 billion last week. Ministry works to ensure enough supply of essential goods Deputy
Minister of Industry and Trade Do Thang Hai on August 3 emphasised the need
to ensure the sufficient supply of essential goods for people, especially
those in provinces and cities which are applying social distancing measures. The Ministry
of Industry and Trade (MoIT) is preparing various plans to respond to all
situations of the COVID-19 pandemic, Hai said. Regarding
industrial production, he requested the MoIT's Industry Agency to work with
associations and enterprises to promptly address difficulties facing them and
maintain production. To support
goods consumption, the Vietnam Trade Promotion Agency must take measures to
assist the urgent sale of agricultural products which are in harvest time,
with the focus on the domestic market. He also
asked the Department of Asian-African Markets and the Department of
European-American Markets to strengthen coordination and find solutions to
boost the export of commodities, particularly farm produce. Acknowledging
the importance of e-commerce, the Department of E-Commerce and Digital
Economy has worked with six major e-commerce platforms to step up the sale of
agricultural products. Ngo Khai
Hoan, Deputy Director of the Industry Agency, emphasised that as industrial
production was not strongly affected by the fourth wave of COVID-19 in the
first six months of 2021, the industrial sector’s added value increased by
11.45 percent, in which manufacturing rose by 11.42 percent. However, in
July, the situation worsened, as the pandemic broke out and spread widely in
southern provinces and cities. Therefore, to maintain production in
enterprises and avoid production disruption, vaccination is still the
fundamental solution and needs to be carried out soon, Hoan added. During the January-July
period, Vietnam earned 185.33 billion USD from exports, up 25.5 percent
year-on-year. This showed an optimistic sign amidst the complex developments
of the pandemic./. HCM City to increase number of mobile sales points, fresh food
stores In order to
ensure stable supply and prices of groceries and foods, the HCM City
Department of Industry and Trade has set up 66 more mobile sales points and
87 fresh food stores. The mobile
sales points will mostly be set up in densely populated areas but with few
shops or supermarkets or just small ones and demand is not fully met. Korean
convenience store chain GS25 has been given the go-ahead to organise 87 fresh
food stores in 22 city districts and Thu Duc city, according to the
department. The
department has also worked with suppliers to organise mobile price-stabilised
sales points to mainly benefit poor and disadvantaged people and those living
in quarantined and locked-down areas. Mai Thuy
Nhan, general director of GS25, said his company had the resources in place
already and all fresh food stores would start functioning by August 4. Supermarkets
and grocery stores are limiting the number of people buying at a time, and
many have started selling combination sets comprising groceries for making
three meals a day for four people at VND200,000-500,000 (US$8.6-21.7). This
ensures people do not have to spend a lot of time selecting individual
grocery items. Deputy head
of the department, Nguyen Phuong Dong, has hailed these innovations, saying
limiting crowds and increasing supply in this manner would limit the spread
of the disease. Since July
20 the department and groceries and foodstuff distributors have organised
1,269 mobile sales points across the city. Steelmakers question timing of product tax adjustments  Under the
proposal, Vietnam plans to impose a 5-per-cent export tax on steel billets
and cut the import tax on some products. This move comes as steel prices have
increased sharply since the beginning of the year by nearly 40 per cent,
affecting the disbursement progress of public investment projects and input
costs of many manufacturing industries. “Although it
will reduce the state budget revenue, reduction of import tax rates is not
expected to be large because current import demand for iron and steel is not
high,” stated the Ministry of Finance (MoF), while stressing the key target
of stabilising local prices. This is not
the first time the imposition of steel tax has been discussed. If approved,
the tax could influence the operation of steel billet makers such as Hoa Phat
Group, Taiwanese-backed Formosa, and Vina Kyoei. If the tax
is imposed, these large Vietnamese exporters would need to offer prices
uncompetitive in key Asian markets. For instance, Hoa Phat Group is currently
the largest exporter of squared billets in the country, with more than
560,000 tonnes, followed by Formosa with an export volume of more than
128,000 tonnes. To support
its members, the Vietnam Steel Association (VSA) has petitioned the
government to refrain from applying the tax, saying it is necessary for local
mills to keep exporting billets to maintain production, particularly as
domestic demand is not high enough to support production levels. The VSA
stressed that the recently rising steel prices are mainly driven by
increasing global raw material costs and demand, with some saying that
Vietnamese steel will lose its competitiveness, while the domestic market
could become fiercer. Nghiem Xuan
Da, chairman of the VSA, said the Vietnamese steel market relies on imported
input materials such as scrap steel, coke, ore, and others. When the prices
of raw materials increase globally, domestic steel prices will surely rise as
well, he said. Along with
that, the pandemic disrupted the global supply chains, causing delays in
delivery times – which is another reason for the sharp increase in steel
prices. “Therefore,
to cope with the current situation, steelmakers need to boost production,
maximise supply capacity, and take measures to reduce costs, while
coordinating the supply chain to further reduce prices, stabilise the market,
and avoid speculation and hoarding,” Da said, adding that now is not the
right time for a tax adjustment. Nevertheless,
the government and related ministries have yet not replied to the VSA’s
petition. A
representative of Hoa Sen Group commented that the increase in steel prices
not only happens locally but also worldwide, arguing that the price hikes are
only happening in the short term. “Thus, there should not be a tax policy to
regulate short-term price fluctuations of the market, as proposed by the
MoF,” the representative said. Hiroyuki
Iwasa, general director of Vina Kyoei Steel Company, said that the draft
related to import tax on steel products will not make any sense at the
present time. Prices of finished steel products are heavily affected by
global market prices. The new policy, if applied, would increase the existing
pressure on domestic manufacturers, forcing some into bankruptcy, according
to Iwasa. Frozen summer fruit exported to Australia A Vietnamese
company has shipped 22 tonnes of frozen dracontomelon duperreanum to
Australia and the summer fruit is scheduled to be put on sale at a Australian
supermarket chain in the near future. Uu Dam
Import-Export Company Limited that delivered the shipment said it is set to
sell the fruit at AUD18 per kilo. The total
value of the shipment in the Australian market stands at more than AUD390,000,
equivalent to over VND6.5 billion, according to figures released by the
Vietnamese Trade Office in Australia. With the
harvest season typically lasting between June and September, there remains
plenty of room for the export of the frozen fruit to various markets,
including Australia. A
representative from the Trade Office revealed that based on market research,
the unit has deployed promotional activities for the fruit through social
media and large distribution networks in Australia. At present,
the Vietnamese Trade Office in Australia is planning to release a culinary
book in English aimed at introducing different groups of Australian customers
to Vietnamese dracontomelon duperreanum. Despite
COVID-19 Vietnamese fruit and vegetable exports to the Australian market in
the first half of the year enjoyed robust growth of more than 52%, reaching
over US$40 million compared to the same period from last year. Along with
other key agricultural products such as cashew nuts, peppers, coffee, and
rice, agricultural exports to this market have hit roughly US$110 million. Africa represents potential market for Vietnamese goods Africa has
been identified as a potential export market for Vietnamese goods, with a
particular focus on farm produce, according to the Ministry of Industry and
Trade. Nguyen Minh
Phuong, an official of the Ministry of Industry and Trade’s Asia-Africa
Market Department says the Vietnamese import and export turnover to Africa
has consistently increased over the past three years, with the country now
enjoying a trade surplus with the market. Despite this
growth, experts point to a number of different hurdles that exist in order to
penetrate deeper into this market, including geographical distance, different
customs, language barrier, and complicated payment methods, especially
fraudulence when it comes to carrying out transactions. Nguyen Duy
Hung, head of the Vietnamese Trade Office in Egypt, therefore advises local
businesses to comply with Halal standards as a means of making further
inroads into the market as Egypt is a majority Muslim country. The trade
representative underscores the importance of State-owned companies helping
with the process of distributing Vietnamese goods, noting that local firms
should not sign contracts via brokers to avoid risks of trade fraud. Do Viet
Phuong, Vietnamese Trade Counselor in Morocco, says the Moroccan market also
shares many similarities with other markets within the African bloc. He
recommends that Vietnamese businesses request legal documents from foreign
partners operating in this market, use reputable banks and immediately
contact competent authorities to resolve any problems which may arise. Taiwan extends anti-dumping investigation into Vietnamese
ceramic tiles The
International Trade Commission (ITC) of Taiwan’s Ministry of Economic Affairs
unveiled that it has moved to extend the ongoing anti-dumping investigation
into Vietnamese ceramic tiles until September 17. The ITC is
set to issue a report on the damage suffered by the domestic industry on
August 9, according to details provided by the Trade Remedies Authority of
Vietnam under the Ministry of Industry and Trade. It is
anticipated to hold a public consultation session on August 16 for relevant
stakeholders in order to review the damage. All
concerned parties are required to register with the ITC in order to
participate in the session at www.moeaitc.gov.tw before August 11. Taiwan
released the preliminary results of anti-dumping investigation on ceramic
tiles originating from the four countries in April, in which the dumping
margin for Vietnamese enterprises ranged between 2.35% and 28.64%. Programme launched to aid export via e-commerce The 90-Day
Amazon Launchpad programme is part of the ministry’s Go Digital Go
Global aid package for enterprises’ digital transformation during 2021-2025,
aiming to help small- and medium-sized ones bring their products to global
markets using digital tools and platforms. Amazon Global Selling is among
partners of the package. Deputy head
of the Enterprise Development Agency Bui Thu Thuy said she hopes the
initiative can support the group in boosting their exports and building their
trademarks in international markets. During 90
days participating in the programme, enterprises will be equipped with
knowledge and guidance in switching to trans-border ecommerce platforms, and
expanding their export channels via such platforms including Amazon. They will be
assisted in building business plans, receive 1-on-1 instruction from the
Amazon Global Selling Vietnam team, and access other support activities. Eligible
participants must operate in the consumer goods sector, target export to the
US and the EU, and commit to building a workforce on ecommerce. Amazon
estimated that more than 1.9 million small- and medium-sized firms are doing
business on Amazon's e-commerce sites, with the profit of third-party sellers
on Amazon reaching US$25 billion. Bilateral trade grows fast after EVFTA coming into force
The EU-Vietnam
Free Trade Agreement, or EVFTA, entered into force on August 1 last year and
has created the conditions needed to boost bilateral trade between Vietnam
and the EU. According to the General Statistics Office, total import-export
turnover between the two sides in the first seven months of 2021 topped 32.2
billion USD, an increase of 4.4 billion USD compared to the same period of
2020. This figure
is expected to rise when the EU-Vietnam Investment Protection Agreement
(EVIPA) comes into force after being ratified in member states. The EVFTA is
considered one of the most advanced trade deals Vietnam has signed. It will
further grow in importance once the COVID-19 vaccination campaign is launched
nationwide and the pandemic is brought under control./. Vietnam's semiconductor market to grow by $6.16 billion Vietnam's
semiconductor market is poised to grow by $6.16 billion during 2020-2024,
progressing at a compound annual growth rate of almost 19 per cent, according
to market research firm Technavio. The growing
use of the Internet of Things will offer immense growth opportunities. To
leverage the current opportunities, market vendors must strengthen their
foothold in fast-growing segments while maintaining their positions in slower
ones. In Vietnam,
the semiconductor industry is deemed to be a platform to facilitate the
development of other industries and was named among the nine national
products to convert sci-tech achievements into high value-added commercial
goods. To develop
the semiconductor industry, the government has allocated $3.2 billion to set
up Integrated Circuit Design Research and Education Center, Saigon High-Tech
Park Labs, and two Integrated Circuits R&D centres, and launched the
first Integrated Circuit Development Programme in 2009. The
programmes provided training to electronic engineers to turn them into
microchip designers and incubated over 30 domestic technology firms. Under
the programme, in 2012-2017, some local chips have been successfully commercialised. Indeed,
Vietnam has attracted more semiconductor companies. In January, Danang
Hi-Tech Park Management Board also granted a license to Hayward Quartz
Technology from the US to develop a semiconductor factory with a total
investment capital of $110 million. Hayward Quartz Technology is from the
Silicon Valley in the US. The company is a leading supplier supporting all
major original equipment manufacturers in the semiconductor business segment. Also in the
same month, Intel Corporation has invested a further $475 million in Intel
Products Vietnam. This new investment comes in addition to Intel’s $1 billion
investment to build a state-of-the-art chip assembly and test manufacturing
facility in Saigon Hi-Tech Park (SHTP) that was first announced in 2006. This
takes Intel’s total investment in its Vietnam facility to $1.5 billion. Pandemic
compelling switch to digital currency The sudden
and unexpected emergence of the Covid-19 pandemic has raised serious concerns
among people in all countries about the transmission of the virus through
paper currency. It is for
this reason that more thought is being given to create alternate non-cash
payment methods, with online and non-contact with cash across countries. This
new preference and shift towards digitization will bring about a new form of
exchange between service providers and consumers. According to
recent statistics from Square, which is a global payment service provider,
the percentage of cashless service providers have more than doubled in the
United States, Australia, Canada, the United Kingdom, and Japan. A survey by
Frost & Sullivan shows that 53% of consumers in the Asia-Pacific region
shop online more often than they did before the Covid-19 pandemic broke out.
It was also seen that almost 54% of consumers in Thailand, 57% consumers in
Singapore, and 68% consumers in Malaysia shop online more often now, than
they did during the years before the global Covid-19 pandemic. With the
rise of e-commerce platforms, the use of digital pay services is forecast to
also increase. A survey shows that non-cash payment methods, such as online
payment by card, e-wallets, digital money transfer, will all grow strongly in
the future. Contact
forms of payment such as at a POS or transactions via ATM will drop sharply.
Along with this will be the development of cashless payment support
infrastructure such as UPI, IMPS, and BBPS. In addition, new payment types
such as Buy Now Pay Later (BNPL) services have also appeared, which are often
advertised as interest-free. BNPL
services also allow users to make payments in scheduled recurring
instalments. In Singapore, about 1.1 million people, or 38% of the total
population, are using BNPL services. Along with
the development of non-cash payment methods in commercial activities,
governments have also promoted the use of non-cash payments in disbursing
support to people and businesses through digital payment service providers.
For example, the Malaysian Government supports people through the MySejahtera
application which is a government mobile application, and Malaysia's main
e-wallet service providers, Boost, GrabPay, and Touch 'N Go. While Indonesia
offers support via Bank Negara Indonesia (BNI) bank account or e-wallets such
as GoPay, OVO and LinkAja. Vietnam is
also moving fast towards this new trend. A survey by Visa in April 2021
showed that non-cash payment methods such as QR code increased by 56%,
e-wallet increased by 51%, online card payment increased by 45%, non-contact
payment by card increased by 48%, and non-contact payment by Mobil increased
by 50%. In addition, a new form of payment, the BNPL form, has also appeared
in Vietnam in the past two years. The serious
effect of the Covid-19 pandemic has compelled the need to digitize payment
methods, and develop forms of digital payments to also meet the needs of
introducing a full scale digital economy in the future. In the post-Covid
pandemic phase, payment forms such as digital currency and e-wallets,
wearable and contactless payments, and QR code scanning will continue to be
emerging payment technologies as consumers will feel more comfortable and
safe about such payment technology methods. In the
future, stablecoins, especially stablecoins with very low value and
volatility, will increase as a means of payment, because stablecoins have the
potential to be universally accepted for payments globally and become a
convenient means of payment for e-commerce, especially when integrated into
online platforms. However, the
development of digital forms of payment also pose several challenges. If cash
is not accepted as a means of payment, this can create a ‘payment gap’
between those who can access digital payment services and those who cannot.
This could negatively impact elderly consumers and those consumers who do not
bank. A BIS report in 2020 showed that in London difficulties in paying with
cash made it difficult for 1.3 million consumers who did not bank in the
United Kingdom. Along with
the diversity of digital payment forms is the increasing participation of
Non-Banking Payment Service Providers (NBPSP), especially for financial
technology companies and big techs. The participation of these organizations,
in addition to promoting financial inclusion, also increases competition and
efficiency in the payment market. However, this comes with potential risks in
terms of consumer protection, operational resilience, and complicated network
infrastructure, protecting customer funds when using payment services, data
protection, user access issues, and market concentration. In addition
to the development of private sector powered digital payment methods,
countries will also accelerate the conversion of paper money to digital
currencies. According to a report released by the Bank for International
Settlements (BIS) in January 2021, a survey conducted with Central Banks of
65 countries and regions around the world, showed that 86% of banks are
actively learning about Central Bank Digital Currency (CBDC). Six out of ten
central banks are in the process of piloting, while 14% are in the process of
developing and arranging for pilot implementation. In this field, China is
currently the leading country in the development of CBDC. Almost all
forecasts for the future show that retail payments will first switch to using
digital currency, especially those currently only using high-value transfers.
If this becomes a reality, banks will need to review their existing payment
infrastructure methods to ensure that they have the necessary capacity,
capability and resources to implement CBDC payment methods in the very near
future to meet a fast rising consumer demand. Sai Gon Hi-Tech Park maintains production while ensuring safety
for workers The city’s
health sector and Thu Duc city authorities must apply strict Covid-19
prevention measures to maintain safety and industrial production value at Sai
Gon Hi-Tech Park (SHTP) amid the pandemic, Phan Van Mai, deputy secretary of
HCM City’s Party Committee, said. During a
visit to the park on Monday, Mai said the park should strive to become “a
green zone” that offers absolute safety even after the current outbreak ends. He said the
city’s health sector should give priority for vaccinations to workers at the
park to help production activities return to normal. Nguyen Anh
Thi, head of the SHTP Management Board, said that 60 of 157 enterprises in
the park were struggling to maintain production with more than 10,000
employees, or only 20 per cent of the number of workers compared to normal
days. They have
set up temporary accommodations and food at work sites or have found places
for their employees to stay following the “One road, two locations” programme
from the city authority. The two
giants Intel and Samsung have seen a decrease in the number of employees but
they have reached production value of more than 60 per cent. The park’s
management board has been working with health authorities to evaluate safety
for people at 10 enterprises so they can add 4,000 more workers. The
enterprises must ensure good living conditions for the workers for the long
pandemic fight, Mai said. “If a risk
or a bad situation happens, it should be handled promptly, without
compromising enterprises’ production and the whole area,” he said. Mai checked
pandemic prevention activities at Samsung Viet Nam Company, and the park’s
canteen for workers. By 2025,
SHTP aims to become a key contributor to the city’s export turnover, reaching
export value of about US$30 billion. It has 164 projects with a total
investment of $8.4 billion. Despite
being hit hard by the outbreak, its production value reached $11.2 billion in
the first six months of the year, accounting for 45 per cent of the set
target. Its export
and import value were $10.5 billion and $9.3 billion in the first six months
of the year, respectively. Vietnam warned of lagging behind in economic recovery The serious
Covid-19 situation and subsequent restrictive measures across 20
provinces/cities in Vietnam have taken a toll on the local business community
as nearly 11,700 enterprises are forced to exit the market every month. Without
drastic measures for aiding businesses, the economy would face an uphill task
to stay on the same wavelength of recovery with their regional and
international peers. Such issue
has been among major topics getting debated at the first session of the 15th
National Assembly (NA) that was recently wrapped up. During the
hearing, Minister of Planning and Investment Nguyen Chi Dung informed that
Vietnam currently has 870,000 enterprises, of which 97% are small and
medium-size with low competitiveness and limited financial capabilities. “Without new
orders, many have been operating with no revenue, and even if that is not the
case, the disrupted supply chains put them in a difficult situation to finish
contracts on time,” Dung said. For the
first half of 2021, the number of enterprises leaving the market rose by 25%
year-on-year, to 70,200, averaging 11,700 per month. Chairman of
the Vietnam Chamber of Commerce and Industry Vu Tien Loc noted except for
those operating in fields of finance, banking, and insurance, the majority
are fast becoming vulnerable. “Many in
aviation, tourism, transportation, and hospitality services are agonizing,
and unless substantial supports are provided, there would barely survive to
see the end of the pandemic,” Loc said. According to
Loc, measures tailor-made for small and micro enterprises are essential and
the timing should be similar to “rescue a dying patient”. Taking a
more specific view on such measures, Deputy Phan Duc Hieu from Thai Binh
Province said while the government should expand current supports in terms of
waiving and reducing fees and taxes, enterprises also need the resources to
restructure operation and improve their corporate governance capabilities to
not only survive but thrive. “They should
be equipped with the ability to absorb and take full advantage of the
financial support provided,” Hieu said. Hieu said in
this context, enterprises that managed to adapt to the situation and with
strong financial capabilities would get ahead of their competitors and gain market
share. On July 30,
Deputy Prime Minister Le Minh Khai approved a proposal from the Ministry of
Finance (MoF) for financial support worth VND24 trillion ($1 billion) for
businesses affected by the pandemic. This would
be the second rescue package for the economy that is initiated by the new
government, following a social package worth VND26 trillion ($1.13 billion)
15 days ago. In April,
the government issued Decree No.52 on extending the payment deadline for
taxes and land rental fees until the end of 2021, estimated at around VND115
trillion ($5 billion). At a hearing
held by the NA on July 25, the MoF is proposing postponing the effective date
of Circular No.40 which provides stricter guidelines on the payment of
value-added tax, personal income tax, and tax administration for business
households and business individuals, until January 1, 2022, instead of August
1, 2021. 583 Volvo cars recalled due to faulted fuel pump fuses A total of
583 Volvo cars have been recalled in Vietnam, which were 2019 and 2020
versions of XC60, S90, V90 and XC90 models, for replacement of fuel pump
fuses. The vehicles
were manufactured from January 2019 to April 2020, imported and distributed
by Sweden Auto Co.Ltd. The recall started from July 31, 2021 and will finish
by July 31, 2022 in Volvo Car Hanoi, Volvo Car Saigon and Volvo Car Da Nang
agents. It will take
about one hour to replace faulted fuse for free. In April
2020, the Ministry of Industry and Trade’s Vietnam Competition and Consumer
Authority (VCCA) oversaw the recall of 732 Volvo cars, including XC90, XC60,
CX40, V90 and S90 models to update emergency braking control software. Of
them, 476 are running and 256 in warehouses. They were
manufactured in Sweden and Malaysia from January 21, 2019 to March 15, 2020
and distributed by Sweden Auto Co.Ltd. The recall started from March 20, 2021
and will finish by December 31, 2022. The VCCA
said the recall was due to the lack of a software code in active safety
domain master./. HCM City economy remains strong despite COVID Despite
struggling to cope with a COVID-19 resurgence, HCM City managed to achieve
positive economic growth in the first seven months of the year, according to
the city Statistics Office. Its
industrial production index (IIP) increased by 2.3 per cent during the
period, with its four key industries, food and beverage, pharmaceutical
chemistry, electronics, and mechanical engineering growing by 2.15 per cent
annually on average. This is
considered a bright spot in the context that the city has to cope with the
fourth wave of the pandemic, while a number of its partner countries are also
dealing with the pandemic, affecting imports of raw materials. The city
needs to continue to perform epidemic prevention tasks well and promote
production at locations where there are no infections, the office said. Enterprises
need to keep a close eye on the situation and safely and effectively carry
out production, it added. Exports by
city enterprises (including crude oil) rose by 8.8 per cent to over US$24.6
billion. Five items
exceeded $1 billion each: computers, electronic products and components,
garment and textiles, machinery, equipment, tools and parts, and footwear. The epidemic
impacted retail sales of consumer goods and services, which reduced by 1.8
per cent to VND583.19 trillion ($25.5 million), but the tourism and travel
industry was affected the most. In the year
until mid-July 20,906 enterprises with a total registered capital of VND
350.4 trillion ($15.3 billion) were set up, year-on-year decreases of 4.6 per
cent and 9.1 per cent. Foreign
direct investment in the first seven months reduced by 25.1 per cent to just
$1.78 billion. Tax and
other revenues were up 18.1 per cent to VND 230.82 trillion ($10.1 billion). An official
from the city tax department said it was expected that collections in the
coming months would be affected. “In July
they decreased by VND2 trillion from June, while in June they decreased by
VND1 trillion.’ Le Duy Minh,
director of the department, said to help enterprises, business households and
individuals revive their business, the department had strived to help them
get VAT refunds quickly. Tax
collection for the rest of the year would be a struggle and require
comprehensive and effective measures, he said. HCM City plans to replace Truong Tho Port with new ICD HCM City
authorities are working on a new inland container depot (ICD) to be built in
Long Binh Ward, District 9, to replace the existing Truong Tho Port complex
in Thu Duc District. The city
People's Committee has directed Thu Duc City to soon submit the 1/2000-scale
zoning plan for the ICD to competent agencies for approval. Once it is
approved, the Department of Planning and Investment will hire contractors to
develop it. With an area
of more than
670,000m2, ICD Long Binh will receive goods from the city’s neighbouring
provinces of Dong Nai and Binh Duong, receive and store raw materials, and
package, label, and distribute goods to ports in HCM City, Dong Nai and Ba
Ria - Vung Tau, and industrial parks and industrial clusters in the
south-eastern and Central Highlands regions. Despite the
threat of Covid-19, many trucks and container trucks continue to queue up in
long lines every day outside Truong Tho port area to deliver and receive
goods. According to
the Department of Transport, the volume of goods passing through it in recent
years is 15 million tonnes a year, while for many years 2,000-2,500 vehicles
have been entering or leaving it every day, exceeding designed capacity. As a result,
the Hanoi Highway section in Thu Duc District, the only road leading to the
port complex, often suffers from congestion. People living in the area live
in fear because of the regular occurrence of deadly accidents involving
motorbikes and trucks. Truong Tho
Ward is expected to become the centre of the newly created Thu Duc city under
urban plans for the east of HCM City, and in the event is not suited to
housing a large cargo port. The city has
instructed Thu Duc to promote investment to develop the Truong Tho urban
area. Source: VNA/VNS/VOV/VIR/SGT/SGGP/Nhan
Dan/Hanoitimes |
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