VIETNAM BUSINESS NEWS AUGUST 3115:20 HCM City tells businesses to test staff for COVID The HCM City Department of Health has instructed businesses to themselves perform rapid COVID-19 tests for their workers once a week to ensure a safe working environment. They need to send their scheduled testing plans to local health centres and authorities overseeing businesses’ activities with the dates and the types and number of test kits required. They have to procure their own medical equipment for testing and arrange staff for the purpose. Training for sampling and testing would be provided by local health centres or the city Centre for Disease Control. They can also work with private hospitals for the tests. They need to send the test results to health centres and relevant authorities for monitoring, and strictly follow the Ministry of Health’s instructions if anyone tests positive. The department has instructed the city’s districts, the HCM City Export Processing and Industrial Zones Authority, Saigon Hi-tech Park, and other similar organisations to keep an eye on businesses’ testing activities and results. Businesses had sought permission to carry out rapid tests for staff by themselves and to vaccinate them to be more proactive in tackling the pandemic and ensuring safe working conditions. HCM City has nearly 700 businesses and factories that have staff living either on-site or at nearby locations since mid-July based on the administration’s mandate. It has been training the public to perform rapid COVID tests at home to ease the burden on medical staff and identify suspected positive cases quicker. The HCM City Export Processing Zone and Industrial Park Authority Business Association has called on the Government to have workers at industrial parks and processing zones and the Saigon Hi-tech Park vaccinated quickly. It wants workers who received their first AstraZeneca vaccine more than eight weeks ago to be given their second jabs soon. It also wants around 20 per cent of staff currently working on-site and who are yet to get their first shot to be vaccinated soon. Nguyen Van Be, chairman of the association, said vaccination would enable more workers to return to work soon and create a safer working environment. A health-care programme for managers and employees at companies in HCM City’s industrial parks, processing zones and hi-tech parks amid the COVID-19 pandemic was launched last week. Dubbed ‘Accompanying businesses to take care of employees' health,’ it will be carried out by the HCM City Export Processing Zone and Industrial Park Authority Business Association (HBA), Vietnam E-commerce Association, HCM City Young Physicians Association and Digital Transformation Alliance for Small and Medium-sized Enterprises (DTS), IM Group, Aloha, iCitizen, and private hospitals and clinics. "The programme offers practical and effective solutions and models,” said Tran Thien Long, vice president of HBA. Its key targets include periodically testing employees, vaccinating employees, helping enterprises’ medical teams test and handle infections, providing test kits at low prices, and providing medicines for COVID treatment. It has a hotline at 1900633336 to advise on prevention and treatment and arrange a hospital to treat infected employees for free or at low cost. Nguyen Ngoc Quynh, CEO of DTS, said the programme has tied up with seven international hospitals and clinics for periodic testing, vaccination, providing health advice to employees, and helping train medical personnel at enterprises in testing. Measures suggested for Vietnam’s economy to navigate pandemic An official of the Japan International Cooperation Agency (JICA) has suggested ways for the Vietnamese economy keep moving forwards amid considerable challenges caused by the fourth wave of COVID-19 infections. In its latest update on Vietnam’s economic performance, the World Bank projected the country’s GDP growth rate at about 4.8 percent in 2021, two percentage points lower than its previous prediction in December 2020. Replying to the Vietnam News Agency’s questions, Shimizu Akira, Chief Representative of the JICA Vietnam Office, said it is unfortunate that the disruption of supply chains has occured while Vietnam has gained so much attention and been considered one of the most desirable countries for the global diversification of supply chains since the beginning of the pandemic. There are many Japanese suppliers of Japanese assemblers or manufacturers being affected. Although the impacted production items are limited only to those Japanese suppliers, since some of which are global companies, such structure of supply chain have given a significant impact on the global supply chain, including Vietnam. To the companies which are included in this supply chain, this issue is highly critical, and they have reportedly had to cut down the production as planned on global basis, Shimizu pointed out. The pandemic has given insights to the importance of the relavant support which has been carried out, he said, noting that firstly, it is important for Vietnam to strengthen its own enterprises so that they enhance their competitiveness by being able to produce high-quality parts, goods, and so forth by themselves. For this purpose, JICA is working closely with the Agency for Enterprise Development under the Ministry of Planning and Investment to enhance the capacity of local enterprises to be able to participate in the supply chain. Secondly, the disruption of corss-border movement shows how important it is for Vietnam to have an enough number of qualified manager/engineers/workers with proper knoweldge and skill without depending on external experts so that they can manage its business without any interruption. For this purpose, JICA cotinues its assistance in developing industrial human resources through trainings on Japanese business models and strengthening vocational schools, the Chief Representative said, expressing the belief that such efforts will help create a resilient supply chain in the Vietnamese industry. Shimizu also held that the Vietnamese Government should accelerate the disbursement of public investment, which is viewed as one of important tools to not only serve economic development but also cope with post-pandemic difficulties in the country./. SMEs hit hard by COVID-19 call for emergency aid A number of small and medium enterprises (SMEs) in Ho
Chi Minh City, the largest coronavirus hotspot in Vietnam, have urgently
called for immediate assistance from the Government in order to help them
cushion the impact caused by the COVID-19 pandemic. Other factors such as land rent, social insurance, and wages for employees have also led them to suspend production activities. “We earnestly request that the Government direct relevant ministries and agencies to urgently make policies to save businesses, so that businesses can accompany the Government in the fight against COVID-19,” read the document. Under the proposal put forward, SMEs requested that the Government devise support policies relating to employees, tax and fee reductions, and finance and banking activities. Most notably, businesses wished to temporarily stop paying social insurance for employees for a period of at least six months until the pandemic is fully brought under control. Moreover, local firms proposed that they receive support in terms of expenses incurred during the pandemic, including help with expenditure such as testing for COVID-19 and accommodation costs for their workers. Currently, employees are subject to COVID-19 testing three times a day and employers are required to pay for the testing. With regard to financial and banking policies, they called for the deployment of a loan scheme with a preferential interest rate package of at least 4%, while also deferring taxes, debts, and land rent for them. Businesses also proposed that a detailed roadmap should be drawn up to show when operations can resume once workers have begun to be fully vaccinated. Market extends rally, VN-Index gains nearly 15 points Shares settled higher yesterday, boosted by pillar stocks. However the market still witnessed foreign investors fleeing from both main exchanges. The VN-Index on the Ho Chi Minh Stock Exchange (HoSE) ended yesterday’s trade at 1,328.14 points, equivalent to a gain of 14.91 points, or 1.14 per cent. Last week, the index had lost 1.22 per cent due to a sell-off. The market’s breadth was positive as 333 stocks climbed, while 64 stocks slid and 34 stocks ended flat. The liquidity was high with more than VND21.3 trillion (US$941.79 million) being injected into the southern bourse, equivalent to a trading volume of over 676.5 million shares. The index was pulled by gains in many large-cap stocks with a quick recovery from bank stocks after last week’s tumbles. Despite a positive session, analysts from SSI Securities Corporation (SSI) warned that the benchmark would soon face correcting pressure as the VN-Index was heading to the resistance area near 1,340 points and it was still in a short-term downtrend. The 30 biggest stocks tracker VN30-Index recorded a rise of 0.88 per cent to close yesterday at 1,431.05 points. Of the VN30 basket, 20 stocks increased while only three stocks fell, and one stayed unchanged. Bank stocks led the market’s rally trend, with four out of the top five most influential stocks in the banking sector. Data compiled by vietstock.vn showed that Vietinbank (CTG) was the biggest gainer yesterday with an increase of 3.69 per cent, followed by Vietcombank (VCB), up 1.53 per cent. The other three stocks were Hoa Phat Group (HPG), up 2.31 per cent, Techcombank (TCB), up 2.39 per cent and BIDV (BID), up 1.94 per cent. Gains in real estate, utilities, information technology (IT) and retail stocks also supported the market. On the other hand, selling pressure rose against some big material stocks in the afternoon session. Accordingly, Masan Group (MSN) posted losses of 2.43 per cent, while Saigon Beer - Alcohol - Beverage Corporation (SAB) fell 0.88 per cent. Vingroup (VIC) also inched down 0.74 per cent yesterday. The HNX-Index on the Ha Noi Stock Exchange (HNX) climbed 0.74 per cent to 341.3 points. During the session, nearly 144.4 million shares were traded on the northern bourse, worth VND2.8 trillion. Meanwhile, foreign investors were still net sellers on both main exchanges as they sold a total of VND408.36 billion. Of which, they net sold a value of VND392.3 billion on HoSE and a value of VND16.06 billion on HNX. Vietnam’s export turnover up over 21% in eight months
Vietnam’s export turnover in the first eight months of this year rose by 21.5 percent year on year to more than 212 billion USD despite a decline of 5.4 percent in August. The group of industrial processing goods reeled in a largest share of total export earnings, with over 189 billion USD, up 22.5 percent year on year. The US remained the biggest export market of Vietnam from January-August. It was followed by China. Meanwhile, the country spent 216 billion USD on imports in the eight-month period, an annual growth of nearly 34 percent, with China being the biggest source of imports./. Vietnam invests $18.3 million in upgrading fairway of Quy Nhon Port Vietnam's Ministry of Transport has signed a decision
approving a project on upgrading the fairway of Quy Nhon Port with an
investment sum of VND421 billion ($18.3 million). The investment will come from the 2021-2025 mid-term public investment plan. The project will be carried out in 2021-2024. Earlier, Le Duy Duong, deputy general director of Quy Nhon Port JSC said that the volume of goods via the port has risen in recent years from 9.1 million tonnes in 2019 to 11 million tonnes in 2020. The port operates at five times its designed capacity. However, the port is facing a problem in attracting more sources of goods as the fairway is able to accommodate 30,000 dead-weight tonnage (DWT) vessels. Duong hopes that after the upgrade it will be able to receive vessels of up to 50,000DWT, thus increasing the volume of goods via the port by 10 per cent. Singapore leads foreign investment in Vietnam Singapore became the largest foreign investor in Vietnam in the first eight months of 2021 with total investment capital of US$6.2 billion as of August 20, accounting for nearly 32.5% of total foreign direct investment (FDI) in Vietnam. According to the Ministry of Planning and Investment, foreign investors have poured US$19.12 billion into Vietnam as of August 20, 2021, equivalent to 97.9% of the figure for the same period in 2020. Of the total, newly registered capital and supplemented capital saw increases while capital contribution and share purchases by foreign investors continued to fall during the eight-month period. The foreign investment went to 18 areas, with the largest investment of US$9.3 billion injected into manufacturing, accounting for 48.4% of total registered capital. Electricity production and distribution came in second for FDI attraction with total investment of nearly US$5.5 billion, occupying 28.7% of total registered capital. A total of 92 countries and territories have invested in Vietnam during the first eight months of this year, with Singapore being the top investor. Japan was the runner-up with total investment of US$3.2 billion, accounting for 16.8% of total FDI capital into Vietnam and up 94.9% compared to the same period in 2020. It was followed by China, Hong Kong (China), and Taiwan (China). FDI capital was poured into 58 provinces and cities nationwide, with the largest investment of US$3.6 billion in Long An, making up 18.9% of total registered capital. Ho Chi Minh City ranked second in FDI attraction with nearly US$2.2 billion, occupying 11.4% of total registered capital. About US$11.58 billion of FDI capital had been disbursed as of August 20, up 2% over the corresponding period in 2020. However, the FDI disbursement in August declined by 12.2% over the same month in 2020 and decreased by 14.3% compared to July 2021 due to the COVID-19 pandemic. Companies rush to provide for COVID-19 orders The demand has soared for tents to help out factories attempting to provide facilities for workers to eat and sleep on the premises. Dang Quang Vu, head of marketing at An Phu Packing Production Co., Ltd in Ho Chi Minh City, told VIR that it has been inundated with orders for tents. “The customers often ordered 500, 700, or 1,000 units each, which are records since the company started operation. At peak times, the company has decreased the capacity of packing manufacturing lines, which are the company’s key product to focus on producing tents.” In order to meet the rising demand, An Phu Packing has had to import products from China or link with other facilities that have seen fewer orders come in. “We also had to refuse some orders, which require a large volume of products in a short time,” Vu added. He said that the selling prices were not currently stable because of a scarcity of materials and an increase in transportation fees for imported products. “At present, rapid-fire orders have calmed down but the demand for tents is still high. The company has received orders from Ninh Thuan, Binh Thuan, and Gia Lai, as they want to prepare carefully in case the pandemic breaks out in these provinces” Vu said. In mid-July, enterprises in 19 cities and provinces in the southern region started to conduct operations under one of two arrangements – “three on the spot” or “one road, two places” to ensure safety amid the ongoing pandemic. Such companies rushed to meet the measures placed to be able to continue operations, which meant either allowing employees to work, eat, and sleep at the facilities, or organise strict strategies for travel to and from home. Koyu & Unitek Co., Ltd. (K&U), a joint venture between Unitek Enterprise Co., Ltd. and Japanese industrial chicken farming group Koyushokucho Co., Ltd., applied the three-on-the-spot method at its factory in the southern province of Dong Nai. K&U general director James Hieu Nhon Khuu told VIR, “The company manufactures and processes essential goods and thus we cannot work from home. When the arrangements were announced, all relevant departments focused on completing the setup for over 300 employees. We have to prepare essential products to ensure convenience and comfort for employees, for example, bunks and mattresses, blankets, pillows, and other necessities.” Meanwhile Nguyen Thi Son Binh, chairwoman of Wanek Furniture Co., Ltd., said that three of its four facilities in the southern province of Binh Duong had to halt operations due to the pandemic restrictions. It moved to set up new measures for 6,000 employees to maintain operations and complete orders. “The company has had to mobilise its entire resources to order tents and relevant essential goods. At the time, so many enterprises were registering to set up the new working models and so ordering became difficult because suppliers are overloaded. We have to track down these goods from various channels,” Binh said. According to a report from Binh Duong Industrial Zones Management Authority, as of late July, approximately 1,450 of 2,000 enterprises arranged for their employees to work, eat, and sleep at their facilities. And in Dong Nai, over 1,000 businesses registered to implement three-on-the-spot, of which nearly 860 were approved. In the Mekong Delta province of Long An, approximately 930 manufacturing facilities with 49,000 employees complied with the measures. Viettel Post’s e-commerce platform ready to help people buy necessities The Ministry of Industry and Trade’s task force in collaboration with the Viettel Post Joint Stock Corporation (Viettel Post) have launched a shopping service on Viettel Post’s Voso.vn e-commerce platform to help people access sources of food without leaving their homes amid the COVID-19 pandemic. Accordingly, the force will support Viettel Post in linking goods sources and forming connections with the Departments of Industry and Trade of provinces and cities to implement the service. Voso has so far debuted 63 websites for the service in 63 cities and provinces nationwide, with the service became operational in 61 of them. In Ho Chi Minh City and Da Nang, where social distancing measures are tightened, Viettel Post and Voso have their resources ready to kick off the service whenever getting permission from the local authorities. Tran Trung Hung, General Director of Viettel Post, said Voso is capable of supplying high quality products to every districts and communes via its professional delivery teams. Earlier, Voso’s shopping service was piloted in 11 localities, including Dong Thap, Hau Giang, Quang Binh, Bac Lieu, Dak Lak, Can Tho, Kien Giang, Tra Vinh, Khanh Hoa, Ca Mau and Hanoi, delivering over 100,000 orders with more than 500 tonnes of products. Based on the pilot, Viettel Post and Voso are committed to delivering between 500-600 tonnes of goods a day in provinces and cities nationwide while ensuring the Ministry of Health’s pandemic prevention and control measures. Viettel Post's delivery teams have been prioritised for vaccination and is requested to seriously follow the Ministry of Health’s 5K message of khau trang (facemask), khu khuan (disinfection), khoang cach (distance), khong tu tap (no gathering) and khai bao y te (health declaration). The teams are equipped with protective gears, with goods packages disinfected before delivery./. Automatic fare collection system for Hanoi urban railway delivered to Vietnam An automatic fare collection system for the Hanoi urban railway line No.3 (Nhon-Hanoi Station) has been delivered from France to Vietnam to prepare for the installation and commercial operation of the elevated section of the project. The Metropolitan Railway Management Board (MRB) has coordinated with contractors to transport relevant equipment from Hai Phong port to Hanoi. Package CP09 “Design, supply and installation of the 4th rail system: Automatic Fare Collection (AFC)” is the final bidding package of the railway line project. It was officially started on October 22, last year. According to the MRB, in late August, 74 percent of the project's workload has been completed. Trains have been safely commissioned on the 8.5-km elevated section of the railway from Nhon depot to Cau Giay station. The urban railway line No.3, connecting Nhon and Hanoi Station, will span 12.5km, running through six districts: Nam Tu Liem, Bac Tu Liem, Cau Giay, Ba Dinh, Dong Da and Hoan Kiem. It consists of 12 stations including eight elevated and four underground. The underground track is scheduled to begin operations in 2022. The project has an investment of about 30.1 trillion VND (1.29 billion USD) sourced from official development assistance of the French Development Agency and loans from the French Government./. Deal sealed for development of 18.6 trillion VND integrated urban project in Dong Nai
Nam Long Group has signed a strategic cooperation pact with the Japan-based realty group Hankyu Hanshin Properties Corporation on developing an 18.6 trillion VND (819.4 million USD) integrated urban project in the southern province of Dong Nai. The 170-ha Izumi City is among Nam Long's key project for 2021-2025, expected to ensure the leading Vietnamese real estate developer's long-term growth. The project is expected to offer some 3,000 low-rise buildings surrounded by many services like health and school facilities. Its first products are scheduled to debut in the third quarter of 2021. Toda Masahiko, director at Hankyu Hanshin Properties Corporation, praised industrial development and housing development potential of Dong Nai. He said his company appreciates the growth of Dong Nai and believes in Nam Long’s development strategy. Nam Long and Hankyu Hanshin Properties have cooperated in five projects in the past five years. Tran Xuan Ngoc, general director of Nam Long, expected the sides’ cooperation to expand beyond housing and land development to include commercial realty, retail and hotel segments./. Better linkage sought in warehouse system Although warehouse real estate is the most promising segment in the industrial property market for foreign investors, the lack of synchronous transport connectivity is a major deterrent for many looking to expand their warehouse systems in Vietnam. Paul Fisher, country head in Vietnam of JLL, said that compared to regional peers, the local logistics market is still at a nascent stage. “We see some much-needed investment going into infrastructure, as well as private sector funds into developing state-of-the-art facilities. Driven by growth in e-commerce and manufacturing, as well as growing domestic consumption, we believe that the Vietnamese logistics market will continue to thrive and evolve in the same way we have witnessed in other markets,” Fisher said. Vietnam, which has been one of the fastest-growing e-commerce nations in Southeast Asia even before the pandemic, has seen a massive acceleration in the segment in 2020-2021 as shoppers stuck at home have taken their purchases online. “Logistics is crucial to the day-to-day operations and future success of the Vietnamese e-commerce market. Many foreign logistics providers are moving to meet the rapidly growing needs of the market,” said Fisher. These trends are only expected to grow stronger over the coming years as Vietnam move from a production to a consumption hub, with logistics providing a key foundation. Experts also said that industrial real estate in Vietnam is only in the initial stage of linking supply chains, warehouses, and the infrastructure system. Thus, it needs the right strategies to support investor participation as well as better human resources that can meet the increasing demands of foreign investors. “The government needs to ramp up infrastructure development so that the private sector can deploy projects offering logistics and supporting services,” said Su Ngoc Khuong, senior director from Savills Vietnam. “Export-import procedures are another problem to consider. Supporting domestic and foreign businesses in clearing and exporting goods will help reduce costs, attracting other foreign investors,” he said. Vietnam’s industrial real estate sector is one of the greatest attractors of foreign investment, with world-class names like GLP, LOGOS, Warburg Pincus, DSV, and Frasers Property, among many others, already present. However, the market is in close competition for foreign investment with China, Thailand, Malaysia, Indonesia, Singapore, and even the Philippines, urging an even more conducive environment for investment. With the aim of pairing runaway growth potential in consumption and trade with improved infrastructure, the National Assembly is discussing public investment until 2025. It is estimated that a total of $35 billion will be invested in the next five years in the southern provinces alone, benefiting industrial producers and the logistics market as a whole. Business environment reform as necessary as vaccine for economic recovery Right at a time when the resilience of the business
community has reached its limit because of the unpredictable development of
the COVID-19 pandemic, the progress of reforming the business environment in
Vietnam is slowing down. In addition, the implementation of social distancing in many localities during this fourth wave has also generated blockages to the flow of goods and production materials. A new report recently released by the Central Institute for Economic Management (CIEM) shows that there are currently five major barriers to Vietnam's competitiveness improvement based on the global competitiveness ranking. They are institutional barriers, the skills of workers and quality of training, inadequacies in management and the specialised inspection of goods, a reduction in business development levels, and limitations in policies supporting innovation. Amid this situation, Dr. Nguyen Dinh Cung, former director of CIEM, worries that if reform is suspended, it will take a few years to regain momentum. Meanwhile, Head of the Legal Division of the Vietnam Chamber of Commerce and Industry Dau Anh Tuan said it is time for Vietnam to have a new and more difficult reform programme in order to create a favourable business environment and foster business development. Since 2014, the Government has chosen an approach to improving the business environment according to international practices with the issuance of Resolutions No. 19/NQ-CP and Resolution No. 02/NQ-CP. After seven years of its implementation, the quality of business environment reform in our country has improved positively and clearly. The reform is not only to move up on the global rankings, but more importantly, to remove thousands of obstacles and barriers to business activities, making the business environment really open and convenient. In addition, the Government also shows its dynamism and creativity in designing and implementing resolutions on improving the business environment and enhancing national competitiveness. The slowdown of reform at this time is worth thinking about as business environment reform is as crucial as a vaccine for enterprises to recover and grow. The COVID-19 pandemic has pushed the world into a new order in which improving the business environment is one of the solutions to drag the country out of the crisis. The business environment will affect how enterprises survive the pandemic and how well they take advantage of opportunities at the beginning of the recovery process. August retail sales plunge as COVID-19 cases on rise Total retail sales of goods and services in August slid 10.5 percent month-on-month and 33.7 percent year-on-year as a result of restrictions imposed to contain the ongoing COVID-19 resurgence, data from the General Statistics Office (GSO) shows. The spike in COVID-19 cases has forced many parts of the country to go into social distancing state under the Prime Minister’s Directive No.16, bringing trade, travel and tourism to a grinding halt, according to the GSO. This month, the transport sector carried more than 60.7 million passengers and nearly 91.1 million tonnes of goods, down 75.9 percent and 39.3 percent, respectively, compared to the same period last year. International arrivals were estimated at around 9,300, up 24.4 percent month-on-month but 43 percent year-on-year. In the first eight months of 2021, total revenue from retail trade and services dropped 4.7 percent year-on-year to exceed 3.04 quadrillion VND (over 133.43 billion USD). The transport industry served over 1.92 billion passengers and handled close to 1.07 billion tonnes of goods during the period, down 18.8 percent and 3.5 percent, respectively. Foreign arrivals shrank 97.2 percent to just 105,000 over the last eight months./. Thai Binh speeds up site clearance to boost economic development The northern province of Thai Binh is taking measures to speed up ground clearance for investment projects in the locality, considering it an effective solution to deal with major bottlenecks in economic development. The provincial People’s Committee held an online conference on August 20 to implement the Directive No.08 dated July 5, 2021 of the provincial Party Committee's Standing Board on strengthening leadership over the implementation of ground clearance to serve the construction of investment projects in the province. At the event, the provincial People’s Committee put forward a plan to implement the directive, in which Thai Binh strives to complete the site clearance for key works and projects in the third quarter of 2021. At the same time, it will carry out an emulation movement "Speeding up the implementation of site clearance to serve the implementation of investment projects in the province” during 2021-2022, starting in August 2021. Speaking at the conference, Chairman of the Thai Binh Provincial People's Committee Nguyen Khac Than said that, besides the achieved results, the province's site clearance still has many limitations and shortcomings that hinder the construction of most of projects, even the key projects, thus causing great obstacles to the implementation of the locality’s economic development tasks and investment attraction. Than requested all departments and sectors to be properly and fully aware of the position and importance of site clearance, and consider it the urgent and annual task of the People's Committees of districts and Thai Binh city. He also asked Chairpersons of the district-level People's Committees to direct the site clearance work. The Department of Planning and Investment was required to actively study investment capital for projects that have effective ground clearance plans and are supported by locals. The Department of Public Security was ordered to keep a close watch on security, social order and safety situation, especially in places where site clearance is being carried out to promptly handle any cases that oppose or hamper the work. According to the provincial Party Committee, following the Resolution of the 20th provincial Party Congress and the Resolution of Party Congresses at all levels for the 2020-2025 term, all departments, sectors and localities in the province have focused on implementing key tasks and solutions synchronously to promote socio-economic development, especially investing in technical infrastructure development and improving the investment and business environment to attract more investment in the province. In particular, the site clearance has received special attention, and achieved positive initial results, thus creating favourable conditions for the implementation of investment projects. On this occasion, six collectives and individuals with outstanding achievements in site clearance were awarded certificates of merit by the Chairman of the provincial People's Committee. In the first half of 2021, the number of newly-established enterprises and branches and representative offices in Thai Binh province rose by 14 percent over the same period last year with a total of more than 420 enterprises, branches and representative offices and a total registered capital of 3.8 trillion VND (166.8 million USD), up 13.8 percent year-on-year. Disbursement of construction investment during January-June reached 77 percent of the yearly estimate, making Thai Binh rank second in the country, after Hai Phong city, in terms of construction investment disbursement so far this year. In the total local budget revenue in the period, domestic revenue reached 67 percent of the estimate with an amount of more than 4.56 trillion VND, a year-on-year jump of 50.1 percent. The northern province has targets its gross regional domestic product (GRDP) growth of 13 percent in the second half of 2021 to fulfil its goal of at least 9.1 percent of expansion for the whole year./. Vietnam’s aquatic sector urged to invest in modern technology Seafood processors and exporters need to invest in advanced technologies and expand markets to match orientation to restructuring the agro-fisheries sector in the direction of improving added value and sustainable development, said Dr. Dao Trong Hieu from the Ministry of Agriculture and Rural Development’s Agro Processing and Market Development Authority. In an interview recently granted to the Vietnam News Agency, Hieu said the sector needs to deal with issues such as the quantity and quality of input materials, low-cost resources and workforce. Meanwhile, over half of processed products still bring trademarks of foreign importers. According to him, the most difficult is how to synchronise the supply of materials and consumption. Domestic firms are yet to be self-sufficient in materials while linkage among production-processing-consumption of aquatic products remains loose, he said. Apart from policies issued by the Party Central Committee, the centrally-run cities and provinces need to continue studying and issuing their own mechanisms to promote the development of their local processing sectors, contributing to lowering production costs and improving added value. At the same time, authorities should build a legal framework and assist firms in large-scale farm produce cultivation, he concluded./. Vietnam Banks Association urges Visa, Mastercard to reduce fees The Vietnam Banks Association (VNBA) has urged international card organisations Visa and Mastercard to reduce several types of fees on Vietnamese banks as the fourth wave of COVI-19 pandemic in Vietnam has seriously affected the lives and production of people and businesses. According to the VNBA, the international card organisations are collecting three to four types of fees for each transaction. The COVID-19 pandemic has a big impact on the card business of Vietnamese banks, the association said in a written document sent to Visa and Mastercard. Regarding payment, the value of transactions by international cards in the first six months of this year saw a drop of 23 percent compared to the same period of 2019. The value of transactions in the foreign markets plunged by 85 percent against 2019’s figure while in the domestic market by 50-70 percent over the pre-pandemic period. Meanwhile, Vietnamese banks still have to pay huge fees to international card organisations. The total fee collected by Visa and Mastercard from Vietnamese banks was estimated at more than 200 million USD per year in 2019-2020, it said. Thus, the association urged the international card organisations to simplify the fee collection mechanism to avoid overlaps in collecting fees. It is essential to have a preferential fee policy for domestic transactions which is in line with that of the card switching organisation currently applied in Vietnam. The VNBA proposed the transaction fees to be cut by at least 50 percent for both banks which issued cards and received payment. It also requested Visa and Mastercard to consider the above proposals and deliver a response before September 10 or arrange a meeting with the association in mid-September to solve the issues./. Hanoi announces 600 online points selling essential goods The Hanoi Department of Industry and Trade on August 30 announced a list of online points of sale and units providing the services on its portal http://congthuong.hanoi.gov.vn Among 600 selling points, 565 are located in districts and wards together with 35 supermarkets, distribution systems and e-commerce platforms to meet public demand amid the COVID-19 pandemic. They mostly sell necessities such as fresh and processed food via orders on telephone, website and Zalo, Gozek, Now apps./. Viettel Post’s e-commerce platform ready to help people buy necessities The Ministry of Industry and Trade’s task force in collaboration with the Viettel Post Joint Stock Corporation (Viettel Post) have launched a shopping service on Viettel Post’s Voso.vn e-commerce platform to help people access sources of food without leaving their homes amid the COVID-19 pandemic. Accordingly, the force will support Viettel Post in linking goods sources and forming connections with the Departments of Industry and Trade of provinces and cities to implement the service. Voso has so far debuted 63 websites for the service in 63 cities and provinces nationwide, with the service became operational in 61 of them. In Ho Chi Minh City and Da Nang, where social distancing measures are tightened, Viettel Post and Voso have their resources ready to kick off the service whenever getting permission from the local authorities. Tran Trung Hung, General Director of Viettel Post, said Voso is capable of supplying high quality products to every districts and communes via its professional delivery teams. Earlier, Voso’s shopping service was piloted in 11 localities, including Dong Thap, Hau Giang, Quang Binh, Bac Lieu, Dak Lak, Can Tho, Kien Giang, Tra Vinh, Khanh Hoa, Ca Mau and Hanoi, delivering over 100,000 orders with more than 500 tonnes of products. Based on the pilot, Viettel Post and Voso are committed to delivering between 500-600 tonnes of goods a day in provinces and cities nationwide while ensuring the Ministry of Health’s pandemic prevention and control measures. Viettel Post's delivery teams have been prioritised for vaccination and is requested to seriously follow the Ministry of Health’s 5K message of khau trang (facemask), khu khuan (disinfection), khoang cach (distance), khong tu tap (no gathering) and khai bao y te (health declaration). The teams are equipped with protective gears, with goods packages disinfected before delivery./. Loopholes remain in management of State capital, assets: State audit office The State Audit Office of Vietnam (SAV) has detected a number of loopholes in the management and use of State capital and assets at enterprises through its audit activities last year. In its report on outcomes of audits in 2020, the SAV said it had conducted audits of financial reports and activities related to the management and use of State capital in the previous year of 160 firms under 17 groups and corporations. Most of them committed mistakes in accounting and performing financial obligations to the State budget. Therefore, following the audits, they had to make adjustments to assets, capital, revenues and costs. As a result, an additional 1.03 trillion VND (45.2 million USD) was collected for the State budget. According to the report, numerous units have not yet issued financial management regulations, such as PVPower and PVOIL Phu Tho. Ineffective management of cash flow remains in many units, the SAV said. In addition, irresponsibility was found in debt management in many companies, resulting in overdue and bad debts. Even though the construction of a number of real estate projects have been completed, they have yet to be put into operation and thus reducing the efficiency of capital use. Some investment projects have been postponed and lagged behind schedule for years. A typical example is a project to develop infrastructure in the Yen Hoa urban area in Cau Giay district of Hanoi has expired for more than 16 years but its licence has not been renewed. There are also many others which have been behind schedule for up to 10 years. The SAV report also pointed out that some investment units recorded low operation results or even huge losses. The SAV also found many businesses have made ineffective investment, resulting in very low profit or losses. Others used land for wrong purposes and after the SAV re-evaluated land rental and taxes, many firms had to pay additional land lease fees. Furthermore, sluggish and inappropriate investment capital disbursement was reported in many companies. The SAV has asked the Prime Minister to order ministries, centrally-run agencies, localities and units to review and impose fines onto those who were responsible for the wrongdoings. So far this year, the SAV has completed 91 audits and proposed financial measures related to 50.87 trillion VND, including collecting an additional 6.65 trillion VND for the State budget and reducing budget spending by 5.79 trillion VND. The agency also proposed scrapping, amending, supplementing and issuing 67 legal documents, helping to deal with loopholes in mechanisms and policies to prevent losses and wastefulness, he said. It will strive to conduct annual audits of budget balances of 80 percent of ministries and centrally-run agencies and localities, and biennial audits for the remaining 20 percent, Auditor General Tran Sy Thanh has said. Regarding the development orientations of the SAV in the following five years, Thanh said that the agency will diversify the types of audit. The SAV is to develop into the main tool of the State which will prove effective in the inspection for the management and use of public funding and assets, as well as anti-corruption and anti-wastefulness. The office is also expected to timely provide information serving activities of the National Assembly, the State, ministries, sectors and localities. To realise the targets, the audit office has identified a number of key tasks to improve its role in corruption prevention and combat, and fostering thrift practice and anti-wastefulness, he added. It will bolster audit activities in the fields of environment, climate change adaptation, complete the legal system in the relevant field and the auditing sector's organisational structure, and improve the quality of human resources. The SAV is serving as Chair of the ASEAN Supreme Audit Institutions (ASEANSAI) Strategic Planning Committee and Chair of the Asian Organisation of Supreme Audit Institutions (ASOSAI) in the 2018 - 2021 term./. Labor shortages may impede companies’ recovery Vietnamese carmaker Vinfast has signed a memorandum of understanding with China’s Gotion High-Tech on the production of a battery for electric cars. Under the agreement, the two sides will work on building a plant in Vietnam to manufacture a lithium ferrophosphate (LFP) battery, which is widely used in electric vehicles thanks to its safety and long cycle life. The battery is also free of rare elements, making it more competitive in terms of pricing and suitable for small and medium electric cars, said Vinfast, a subsidiary of Vingroup. The plan to build an LFP battery manufacturing plant in Vietnam among Vinfast’s efforts to establish a green energy ecosystem in Vietnam, helping to increase the domestic content in its products. Vingroup has already created a subsidiary known as VinES to develop battery solutions and manufacture batteries for electric cars. In addition to Gotion High-tech, Vinfast is also cooperating with other partners from the United States, Israel and Taiwan (China) in the research and development of advanced battery technologies. The company is planning to build battery and charger plants in the US and Europe as part of its strategy to expand into the global market in the future. Interpreting new real estate statutes Real estate funding is expected to increase further thanks to new rules on investment. Tran Thai Binh, Nguyen Thi Phuong Thao, and Tran Huong Giang at LNT & Partners analyse how the new rules can impact the market in the future. Whist Vietnam has been an investment spotlight for its explosive real estate market in recent years, the complex web of legislation governing this area have by and large deterred foreign investors. Vietnam passed the new Law on Investment 2020 and issued related Decree No.31/2021/ND-CP in March, providing details and implementation of the law, which stamp out barriers to certain domestic sectors, provide more incentives for desired investment projects, and attempt to ensure uniformity of the legal framework. The Law on Investment 2020 detailed three methods of investors determination. First is an auction of the land use right in accordance with the laws on land. Competent authorities shall organise an auction of the land use right in a case of allocation or lease of land for implementation of a project, and where the proposed area of land for project implementation has already been cleared. Second is bidding for the selection of an investor. Authorities shall organise biddings to select investors for implementing the projects in the cases specified in Article 1 of the 2013 Law on Bidding, in which the investment projects using land are included. Third is investor determination regarding to the Law on Investment 2020 other than the above two methods. For projects subject to in-principle approval and not subject to auction or bidding, the competent authorities shall approve the investment in principle and concurrently approve the investor in several cases. Firstly, if the investor receives an assignment of, capital contribution portion or lease of an agricultural land use right to implement a project for non-agricultural production or business and the land is not subject to land resumption by the state in accordance with the laws on land. Secondly, local authorities shall approve if the investor has the land use right, except for the case of land resumption by the state for purposes of national defence and security or the state resumes the land for socioeconomic development in the national or community interest. The third factor is if the investor implements the investment project in an industrial zone or high-tech zone, and the fourth option involves other cases not subject to an auction or bidding in accordance with laws. While the Law on Investment 2014 did not specify in detail methods of investor determination and approval, these methods were practically covered by pre-existing legislation. The Law on Investment 2020 simply consolidates these methods in its body. In respect to the second method of investor determination, under the Law on Investment 2020 and Decree 31, for projects subject to investment in-principle approval under laws on investment, competent authorities shall issue such approval before organising bidding to select investor implements the project. The investor that succeeds in bidding shall conduct procedures for land allocation or land lease related to laws on land and laws on bidding, and implement the project in accordance with the in-principle approval and the decision accept the results of selection. In addition, Decree 31 has lifted the barriers in relation to land allocation or land lease for land-using projects subject to bidding procedures. Prior to the effectiveness of such legislation, some local authorities rejected to allocate or lease land to the project enterprise established by the investor who succeeded in bidding, since there was no regulation clearly stipulating so. However, Decree 31 amends Article 60 of Decree No.25/2020/ND-CP by replacing the phrases “the investor” and “the investor who succeeds in bidding” with “the investor who succeeds in bidding or the project” enterprise established by the investor who succeeded in bidding for implementing the project”. Under the Law on Investment 2020 and Decree 31, foreign investors shall have the same treatment as domestic investors, except in cases where such foreign investors seek to invest in organisations engaging in business lines with conditional market access; business lines with market access prohibition to foreign investors; or in economic organisations that have a certificate of land use rights on an island, at a border or coastal commune, or in another area that affects national defence and security. In general, foreign investors that purchase capital contribution or share capital in economic organisations engaging in real estate trading must meet several conditions. They include limitation on foreign ownership of contributed capital or share capital; conditions on forms and scope of investment; conditions on capacity of investors or partners participating in related activities; investment to ensure national defence and security; and investment to comply with regulations and conditions for receipt of land use rights and conditions for use of land on islands, at borders, or in coastal communes. Further conditions involve ultilisation of land, labour, and natural resources; manufacturing or supplying public goods and services or those currently a state monopoly; owning and trading houses and real estate; and applying forms of state support and subsidies to a number of branches, domains, or development of regions or territories. Although not being mentioned in the Law on Investment 2014 specifically, in practice, all of the conditions have been strictly applied, except for the fairly new conditions relating to land in areas affecting national defence and security. The Law on Investment 2020 focuses on the increase in foreign ownership in local companies. It has strictly controlled foreign investors by reducing the threshold for an enterprise to be treated as a foreign investment enterprise from “from 51 per cent and above” under Law on Investment 2014 to “over 50 per cent” under the new investment laws; which is apparently reasonable. Prior to the Law on Investment 2020, this procedure is solely subject to the laws on real estate trading. For real estate projects issued with either investor approval regarding Article 29 of the Law on Investment 2020 or the Investment Registration Certificate related to Article 37, procedures will be implemented in accordance with the newer law. For other real estate projects without the abovementioned investor approval or an investment registration certificate (investment law transfer procedure), the investor shall follow procedures under the laws on real estate trading (real estate transfer procedures). There are two notable changes in respect to the investment law transfer procedure. Firstly, it specifies a single government authority for application and contact which is the investment approval body. This is different from the real estate route where, depending on the case, the investor has to determine the authority to submit the application to. For instance, the legislation stipulates that for real estate projects that are not a new urban area or housing development, the application shall be submitted to a specialised department prescribed by the people’s committee. In practice, the application might be passed around among different authorities which might claim no jurisdiction to decide and indeed, it will frustrate the transferor and the transferee in the process. Second, the investment law transfer procedure follows a one-step approach. Particularly, applications are sent to the competent investment registration authority where the eligibility for transfer is cross-examined by relevant authorities; and any approval shall recognise the transferee and the transferor, with the project part being transferred along with the investment registration certificate as well. In contrast, under the real estate law transfer procedure, the competent authority shall only issue a decision to permit the project transfer. Within 30 days from such a decision date, the transferor and transferee must complete the execution of the transfer contract and project transfer. Before the transferor hands over the project to the transferee, the transferor must notify all its clients (if any) and announce by means of mass media 15 days prior, via at least three consecutive issues of a local newspaper, a local television station, or a website of the central agency in terms of the transfer, rights, and interests of clients and relevant entities. The transferor must also transfer all documents of the whole/part of the project being transferred along with a list of documents to the transferee. The conditions in respect to the transfer approval remain. However, it seems in theory, the process which requires the transferor to notify is being phased out. From the above observations, the investor should pay close attention to contract structuring and liaise closely with the provincial people’s committee as the procedure might vary significantly based on local interpretation and geographical features of the real estate project itself. HCM City resumes work on seven urgent construction projects Construction of seven urgent projects in HCM City, including key traffic projects, have been licensed to continue working during the Covid-19 pandemic. The municipal People’s Committee deputy chairman Lê Hòa Bình on Wednesday (August 18) approved a proposal by the city’s Department of Construction to resume the construction works to ensure completion as scheduled. The projects include construction works serving pandemic prevention and control. The Metro Line No.1 project between Bến Thành Market in District 1 and Suối Tiên Theme Park in Thủ Đức city, construction of which began in 2012, is expected to officially open for use next year. Construction work will also continue on Thủ Thiêm 2 Bridge over the Sài Gòn River linking District 1 and Thủ Đức City. It is around 70 per cent complete and is scheduled to open to traffic in the second quarter of next year. It will improve connectivity between downtown and Thủ Thiêm, and boost the development of the city’s eastern innovative urban area. The city will also resume building an overpass in front of the new Miền Đông (Eastern) Bus Station on Hà Nội Highway in Thủ Đức city. A project to build technical infrastructure will continue on nine land plots, covering 77,600 square metres, in the Thủ Thiêm new urban area in Thủ Đức city. Under the project, six land plots are planned as residential areas, while the remaining are for commercial areas. Construction of a double tunnel below Nguyễn Văn Linh Boulevard at its intersection with Nguyễn Hữu Thọ Street in District 7 is expected to be completed in the third quarter of next year. It will reduce the severe congestion and accidents that plague the intersection because of the huge number of vehicles, particularly container trucks, that travel on Nguyễn Văn Linh Boulevard daily. Construction of a cardiology centre, neonatology centre and a building for health examinations and surgery at HCM City Paediatrics Hospital 1 will be completed by the end of this year, meeting the increasing number of patients. The committee has asked the Police Department, in collaboration with relevant departments and agencies, to create favourable conditions for units to implement the projects. The city had previously required non-urgent construction projects to suspend operation under social distancing regulations amid the COVID-19 outbreak. Deputy PM orders boosting national, ASEAN one-stop-shop mechanisms Deputy Prime Minister Pham Binh Minh has asked relevant ministries and agencies to take solutions to push ahead with national and ASEAN one-stop-shop mechanisms. He also ordered reforming inspections over exports and imports, and facilitating trade activities from now to the year-end. As of June 30, the national one-stop-shop mechanism had connected 226 administrative procedures of 13 ministries and agencies. In the closing months of 2020 and the first half of this year, the Ministry of Finance coordinated with other ministries and agencies to officially launch the model, with 26 administrative procedures. Vietnam has joined the ASEAN one-stop-shop model to exchange the CO (certificate of origin) e-Form D with other members of the grouping. As of June 30, Vietnam had received a total of 375,646 certificates from ASEAN member countries, while sending 955,300 others to them. Apart from ASEAN, Vietnam has also exchanged CO with the Republic of Korea (RoK) and New Zealand, and negotiated with the Eurasian Economic Union (EAEU) for the exchange. Such agencies as the Ministry of Industry and Trade, the Ministry of Science and Technology, the Ministry of Information and Communications and the Ministry of Public Security have shifted to post-customs clearance inspections. Pointing out burdensome tasks in this regard from now to the end of this year, Minh asked the Ministry of Finance to urge other ministries and agencies to complete their tasks in line with the Prime Minister’s decisions on an action plan to boost the national and ASEAN one-stop-shop mechanisms, reform inspections over exports and imports, and facilitate trade activities for the 2018-2020 period. Joint efforts are needed to speed up the building and implementation of the master plan on building and developing an IT system in service of the mechanisms, he said, noting that the document should be submitted to the PM in the first quarter of 2022. Minh also ordered devising a plan of action to roll out the national one-stop-shop model, foster logistics and create optimal conditions for trading for 2021-2025, and sending it to concerned agencies./. Source: VNA/VNS/VOV/VIR/SGT/SGGP/Nhan Dan/Hanoitimes |
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