VIETNAM BUSINESS NEWS SEPTEMBER 29

15:23

Hanoi sees sharp drop in tourist arrivals in nine months

Hanoi welcomed 2.9 million visitors, all from localities inside the country, in the first nine months of 2021, a fall of 57.5 percent year on year, according to the city’s Department of Tourism.

The department reported that total revenue of the sector also dropped 66.2 percent over the same period last year to 8.17 trillion VND (356.1 million USD).

In the coming time, the department will focus on strengthening COVID-19 prevention and control among businesses, organisations and individuals engaging in tourism activities in the city, while increasing the application of information technology in tourism management.

Alongside, the department will finalise and submit to the municipal People’s Committee a plan to organise a travel gift festival, and a plan on agricultural tourism development in line with new-style rural area building in the 2021-2025 period.

This year, the city’s tourism sector has set an overall target of catering to between 13.16 and 19.4 million tourists, including 10.96-15.34 million domestic visitors./.

Reference exchange rate up 10 VND

The State Bank of Vietnam set the daily reference exchange rate at 23,155 VND/USD on September 29, up 10 VND from the previous day.

With the current trading band of +/- 3 percent, the ceiling rate applicable to commercial banks during the day is 23,849 VND/USD and the floor rate 22,461 VND/USD.

The opening hour rates at commercial banks turned around to drop.

At 8:30 am, Vietcombank listed the buying rate at 22,630 VND/USD and the selling rate 22,860 VND/USD, both down 10 VND from September 28.

Meanwhile, BIDV kept both rates unchanged at 22,670 VND/USD (buying) and 22,870 VND/USD (selling)./.

WB: Vietnam’s economy could converge toward pre-pandemic rate from 2022 onward

Vietnam’s GDP is expected to expand by about 4.8 percent in 2021, and the economy could converge toward the pre-pandemic GDP growth rate of 6.5 to 7 percent from 2022 onward, the World Bank has forecast.

In its East Asia and Pacific Fall 2021 Economic Update released on September 28, the bank said a sustained global recovery would ensure strong demand for Vietnamese products in its main export markets like the US, EU, and China.

According to the bank, aside from the second social protection support package, the government is considering tax relief to support businesses.

Fiscal policy would become more supportive with faster execution of public investment, especially once mobility restrictions are rolled back, it said.

Given available fiscal space, the government should deploy further resources to mitigate adverse social impacts, the bank said, suggesting Vietnam pursue the goals of green growth and digitalisation to raise the resilience and sustainability of its economy.

In its September 2021 Vietnam Macro Monitoring, the bank also said the foreign direct investment (FDI) inflow suggests continued confidence in Vietnam’s economy.

WB experts explained that Vietnam’s economy still grew 2.9 percent last year against serious decreases seen in other countries.

Earlier, the Asian Development Bank (ADB) revised down Vietnam's 2021 GDP growth forecast from 6.7 percent to 3.8 percent due to a resurgence of the COVID-19 pandemic that has tightened the labour market, lowered industrial output, and disrupted agricultural value chains.

ADB remains bullish on the country’s prospects in the medium and long term. Growth could be aided by a revival of domestic demand, an acceleration in the disbursement of public investment, and an expansion to new export markets thanks to multiple free trade agreements and the expected global economic recovery.

For the East Asia and Pacific region, the WB said its recovery has been undermined by the spread of the COVID-19 Delta variant, prolonging the distress for firms and households, likely slowing economic growth and increasing inequality.

Economic activity began to slow down in the second quarter of 2021, and growth forecasts have been downgraded for most countries in the region.

While China’s economy is projected to expand by 8.5 percent, the rest of the region is forecast to grow at 2.5 percent, nearly 2 percentage points less than forecast in April 2021. Employment rates and labor force participation have dropped, and as many as 24 million people will not be able to escape poverty in 2021.

“The economic recovery of developing East Asia and Pacific faces a reversal of fortune,” said World Bank Vice President for East Asia and Pacific Manuela Ferro. “Whereas in 2020 the region contained COVID-19 while other regions of the world struggled, the rise in COVID-19 cases in 2021 has decreased growth prospects for 2021. However, the region has emerged stronger from crises before and with the right policies could do so again.”/.

Nearly 70 percent of firms in Tay Ninh resume production

The HCM City People’s Committee has made several suggestions for a Ministry of Finance decree to support businesses and individuals affected by the COVID-19 pandemic, including ensuring bank lending rates are no more than 2 per cent higher than deposit interest rates.

In a document it sent to the Government, it also suggested reducing corporate income tax, value added tax and land rents, extending tax payment deadlines and subsidising interest.

It called for cutting corporate income tax by 50 per cent for businesses with annual revenues of less than VND200 billion (US$8.8 million) this year and by 30 per cent for 2022 and 2023.

It said the costs of testing workers, medical treatment, food and living costs, and personal protective equipment such as masks should be tax deductible.

It called for waiving income tax, value added tax, natural resources tax, and environmental protection tax on household and individual businesses in the second half of 2021 and the next two years, and income tax for some employees.

It sought a halving of value added tax for the last three months of this year and the next two years.

The deadline for filing tax should be extended until the second quarter of next year without penalty for late payment, it said.

It suggested that the land rent payable should be cut by 50 per cent for all businesses this year, and fully waived for tourism and related businesses.

Procedures to borrow from banks and rolling over debts should be simplified, it added.

Changing COVID-19 strategy key to economic recovery

Changing a COVID-19 strategy to live safely with the virus is the key to economic recovery that can help Vietnam retain foreign direct investment (FDI), according to Nguyen Hai Minh, vice president of the European Chamber of Commerce in Vietnam (Eurocham).

Foreign direct investment (FDI) attraction remains a bright spot in Vietnam’s overall economic picture despite numerous recent difficulties caused by the COVID-19 pandemic.

For instance, Taiwanese firm Polytex Far Eastern Co., Ltd increased its investment capital by US$610 million, while Japan’s Kraft Vina paper Co, Ltd also poured US$611.4 million into the northern province of Vinh Phuc.

Elsewhere, August 30 saw LG Display Co., Ltd of the Republic of Korea also increase their investment capital by US$1.4 billion in the northern city of Hai Phong.

The northern province of Quang Ninh hosted a ceremony on September 19, granting an investment license to a US$400 million project by Jinko Solar Vietnam Co. Ltd, one of the leading manufacturers of solar panels in the world.

According to statistics released by the Ministry of Planning and Investment, Vietnam had attracted roughly US$22.2 billion in FDI by September 20, representing a rise of over 4% compared to the same period from last year.

Singapore topped the list of foreign investors, pouring in approximately US$6.3 billion, followed by the Republic of Korea with over US$3.9 billion, and Japan with US$3.3 billion.

Experts said it’s time Vietnam was prepared to live safely with COVID-19 in a new model as many countries in the world have adopted. In his role as Eurocham vice president, Nguyen Hai Minh underlined the need to adapt to the pandemic in line with both modern trends and in a global context.

The COVID-19 prevention and control strategy should be changed flexibly that is the key to economic recovery, he said.

He affirmed that despite the negative impact caused by the pandemic, European businesses consider Vietnam an attractive investment destination in the long term.

Minh quoted a Eurocham survey saying the prolonged COVID-19 outbreak has negatively affected 60% of European businesses, forcing them to scale down production.

The extended enforcement of social distancing measures has exerted a significant impact on the activities of FDI enterprises, leading to a supply chain disruption and a shortage of workers, especially foreign experts.

However, many European financiers have chosen not to withdraw their capital from the Vietnamese market despite the COVID-19 challenges.

To retain foreign investment, Minh suggested that Vietnam speed up the COVID-19 vaccination process for employees of FDI enterprises, including European businesses, while simultaneously devising solutions aimed at living safely with COVID-19.

He also proposed removing obstacles for FDI enterprises by exempting quarantine period for foreign experts with a vaccine passport, as well as carrying out customs clearance procedures in a fast manner.

Three Holiday Inn Hotels to open Vietnamese location

InterContinental Hotels Group (IHG), one of the world’s leading hotel firms, has announced plans to open three Holiday Inn Resorts in Vietnam’s Ho Tram, Ha Long Bay and Sa Pa, over the next three years.

Accorrding to Business Traveller website, IHG has partnered alongside Ha Long Bay Hotel Joint Stock Company in order to open its second Holiday Inn Resort in the country, with another property located in Ho Tram Beach.

The hotel is set to be situated in a mixed-use skyscraper on Bai Chay Road, a 50-minute drive from Hai Phong’s Cat Bi International Airport.

Media outlet Business Traveler stated that the facilities will include three restaurants and bars, over 1,300 sqm of meeting space, an adult-only infinity pool, an indoor kids’ adventure pool, along with a fitness centre and spa.

“Its opening in 2023 will herald a new era of fun for the whole family in Ha Long City – a concept we know is in high demand and is reflected in our decision to open three Holiday Inn Resorts in the country – Ho Tram, Ha Long Bay and Sapa – in the next three years,” says Serena Lim, vice president of Hotel Development in Southeast Asia and Korea of IHG.

Earlier on September 9, IHG also announced the grand opening of the 350-room Holiday Inn & Suites Saigon Airport, the first Vietnamese Holiday Inn.

The hotel has a total of 350 well-furnished rooms, including 100 spacious suites, all of which feature city or pool views. The fourth-floor lifestyle zone also offers comfortable lounges, a 50-metre swimming pool, and a 24-hour gym, while the Kids Stay & Eat Free programme and Kid’s Activity Room will make the hotel a wonderful option for all families.

The group currently has a chain of 13 hotels in Vietnam, the majority of which are within its luxury and lifestyle segment.

Vietnamese seafood exports target niche markets

Vietnam’s seafood exporters are seeking ways to boost shipments to niche markets, as COVID-19 is disrupting supply chains, hindering logistics services and raising transportation costs.

According to the Vietnam Association of Seafood Exporters and Producers (VASEP), in August, Vietnam’s seafood exports to its key markets such as China, Japan, Germany, the Netherlands, Belgium, Denmark, and the UK reported year-on-year decreases of 35-45 percent.

In the contrary, impressive growth was seen in shipments to niche markets. Specifically, Vietnam’s seafood exports to Mexico rose by 72 percent, the Philippines 58 percent, Spain 48 percent, Egypt 38 percent and Portugal 14 percent.

At present, the value of exports to niche markets accounted for 8-10 percent of Vietnam’s total seafood export turnover./.

Vietnam expects 710,000 newly-established enterprises in next five years

The Ministry of Planning and Investment (MPI) has coordinated with relevant ministries, sectors, agencies and localities to build a draft resolution on supporting and developing businesses in the 2021-2025 period, with a target of about 710,000 newly-established enterprises in the period.

Under the document, various support policies will be designed to assist businesses in recovering, expanding and improving their competitiveness. In 2025, Vietnam expects to have over 2.1 million companies.

In the period, about 10 start-ups are hoped to reach the value of over 1 billion USD, while about 35-40 percent of total firms are expected to launch science-technology application and innovation activities, and 100 percent of companies are hoped to access digital transformation, with 100,000 firms getting support in the field.

To this end, the MPI will give eight groups of solutions, focusing on improving the investment and business environment, expanding domestic and foreign markets, strengthening the credit access for businesses, especially those hit by COVID-19.

Alongside, the ministry also proposed support to human resources development and the fostering of connectivity among enterprises so that they can join domestic and international value chains and gradually lead the chains in the next five years./.

MoIT helps businesses to prepare for RCEP

The Ministry of Industry and Trade (MoIT) is collecting comments on a draft circular regarding the Rules of Origin regulations for the Regional Comprehensive Economic Partnership (RCEP).

According to the MoIT, after 8 years of negotiations on the RCEP agreement, ten ASEAN countries and five partner countries (Australia, China, Japan, Korea and New Zealand) officially signed the agreement in October 2020.

When the agreement comes into force Viet Nam will be part of the largest free trade area in the world, with 2.2 billion consumers, and account for about 30 per cent of global GDP.

The RCEP will eliminate about 92 per cent of import tax between the signatory countries within 20 years, and establish common rules for e-commerce, commerce and intellectual property rights.

In particular, RCEP is designed to cut both costs and time for traders by allowing them to export goods to any of the signatory countries, without having to meet the specific requirements of each member country.

The ministry said Vietnamese enterprises will benefit from reduced transaction costs and a more business-friendly environment, as existing regulations in different ASEAN FTAs are harmonised under the RCEP agreement.

Regarding the import and export of goods, Tran Thanh Hai, deputy director of the ministry's Import-Export Department, said that although ASEAN countries and Viet Nam have some separate FTAs, the RCEP can be considered as both an upgrade and a set of higher requirements for the tradings within the region.

Hai said: "When the RCEP agreement comes into effect it will create vitality in the Vietnamese economy, as relationships between Viet Nam and other Asian countries are further developed."

Luong Hoang Thai, director of MoIT's Multilateral Policy Department, said the RCEP agreement is expected to make an important contribution to the recovery of the regional economy after the COVID-19 pandemic.

The Rule of Origin regulations on goods means, that instead of applying five sets of rules from five different agreements, the signatory countries can instead trade more freely.

The establishment of this agreement will create opportunities for Vietnamese businesses to develop new supply chains in the region.

Thai added that the recent volatility around the world has caused prolonged disturbances to supply chains. The formation of the world's largest free trade area will allow a more stable export market, meaning Viet Nam can focus instead on building an export-oriented production base for the world.

The RCEP agreement will also create a legally binding framework on trade policy, investment, intellectual property, e-commerce and dispute settlement.

In order to fully exploit the benefits of the RCEP agreement, Vietnamese enterprises need to carefully study the agreement, especially those related to the business sector, said Thai.

Experts from MoIT recommend that businesses prepare for the implementation of RCEP by strengthening the domestic market, improving product quality, and accurately identifying their brands.

They said businesses must develop a plan to open their markets and proactively prepare for some of the adverse effects caused by the agreement.

To help local businesses join the RCEP, the circular issued by MoIT regarding Rules of Origin of goods details the regulations agreed upon by the member countries.

The draft said that the certificate of origin will be a common form agreed upon by all members, with a specific reference number expressed in English and bearing the signature and seal of the issuing organisation. The certificate of origin will be valid for one year from the date of issue.

To accommodate feedback on the Rule of Origin certificate, MoIT is asking for comments on the draft to be submitted via the ministry's web portal.

Ha Noi views strong disbursement of public funds as major growth driver

Amid the complex COVID-19 situation, accelerating the disbursement of public investment is one of the main tasks Ha Noi will carry out in the remaining months of 2021 to achieve the best possible economic outcomes.

The municipal People’s Committee has demanded district-level People’s Committees take drastic actions to implement measures for promoting economic growth, public investment disbursement, and sustainable exports in line with the Government’s Resolution No 63/NQ-CP, according to the Cong Thuong (Industry & Trade) newspaper.

The Ha Noi administration asked all-level authorities and sectors to effectively manage and use the budget, reduce regular expenditures to increase local budget reserves, focus on COVID-19 prevention and control, and invest more in performing security - defence tasks and important and urgent activities of the city.

So far, Ha Noi has disbursed just 31 per cent of this year’s public investment capital assigned by the Government, lower than the rate in the same period last year and the national average.

Given this, the municipal People’s Committee requested leaders of agencies and localities to keep paying attention to the task while tackling difficulties and quickly completing procedures for projects funded by public capital.

They need to speed up the disbursement progress so as to disburse 100 per cent of the assigned public capital, the committee said, asking them to view the disbursement of public funds as one of the important solutions to fuel the city’s economic growth in the remaining months of 2021.

The People’s Committee of Ha Noi has also identified some other focal tasks, including piloting the urban administration model, developing five suburban districts (Dong Anh, Thanh Tri, Hoai Duc and Dan Phuong) into urban districts, and carrying out the Government’s Resolution No 97/NQ-CP, issued on August 28, on reducing power bills and prices for the fifth time since the start of the pandemic.

In August, many local businesses suffered from impacts of the COVID-19 pandemic, with many indices declining from July and the same period last year.

Ha Noi recorded about US$1.28 billion in exports in August, down 0.7 per cent month on month and 34.6 per cent year on year. That added up to an eight-month turnover of over $9.78 billion, down 5.2 per cent from a year earlier.

The index of industrial production (IIP) fell by some 8 per cent from the previous month, with the processing and manufacturing sector down 8.8 per cent, and electricity production and distribution down 2 per cent.

Nevertheless, the index increased 6.3 per cent year on year during the first eight months, statistics show.

Total retail sales of goods and consumer service revenue were estimated at VND25 trillion (over $1 billion) in August, down 32.2 per cent month on month and 51.2 per cent year on year. The sum stood at around VND349.5 trillion in the reviewed period, down 6.3 per cent from the same period last year.

However, the capital city also recorded encouraging outcomes in several aspects.

The January - August State budget revenue was estimated at VND164.48 trillion, equivalent to 69.8 per cent of the target assigned by the Government and 110.3 per cent of the figure in the same period last year.

The IIP of some industries still grew strongly during the eight months, including the production of motorised vehicles up 21.6 per cent, apparel 18.2 per cent, beverage 16.1 per cent, timber processing and wood product manufacturing 10.9 per cent.

Meanwhile, domestic revenue, except for oil, managed by taxation authorities increased 9.7 per cent from a year earlier, with the revenue from production and business activities up 28.9 per cent.

Amid complex developments of COVID-19, enterprises in Ha Noi have made efforts to sustain operations. Many of them have applied the “three-on-site” model, which involves workers eating, sleeping, and working at factories and taking rotational leave.

Many districts have recorded good progress in public capital disbursement such as Thanh Xuan, Phu Xuyen, Ha Dong, Hoan Kiem and Cau Giay.

Nearly 70 percent of firms in Tay Ninh resume production

The southern province of Tay Ninh saw 185 foreign-invested and domestic companies, or close to 70 percent of its total, across local industrial parks and economic zone registered to resume their operations as of September 27.

According to Ha Van Cung, head of management board of the Tay Ninh Economic Zone, the production resumption attracted 56,000 workers, or over 40 percent of the province’s total, returning to work.

To ensure COVID-19 prevention and control, the provincial authorities continue guiding firms to conduct the in-place production method, regular testing, and vaccinations for workers.

To date, nearly 30,000 labourers at the local industrial parks and economic zone have been vaccinated against COVID-19.

Tay Ninh currently houses six industrial parks in the planning of Vietnam's industrial parks approved by the Prime Minister, spanning a total natural land area of 3,969 ha. Five of them, covering 3,385 ha in total, have been licensed to operate, with their occupation rate reaching 61.14 percent. Before the fourth wave of COVID-19 hit Vietnam in late April, these parks had 268 enterprises operating with more than 133,000 employees./.

Netherlands - Gateway for Vietnamese goods to enter EU

The Netherlands, one of the leading partners of Vietnam in the EU, is a gateway for Vietnamese goods to enter the EU market, experts have said.

According to the Vietnamese Office for Trade Affairs in the EU, a large volume of Vietnamese goods exported to the Netherlands are re-exported to other European countries. Therefore, Vietnam is also considered the leading trade partner of the Netherlands in Asia.

The Vietnam-EU Free Trade Agreement (EVFTA) is expected to open up greater for businesses from both countries to foster their partnership.

According to the Ministry of Industry and Trade (MoIT), Vietnam and the Netherlands have shared close ties in various fields, especially industry, green and renewable energy, circular economy and emission reduction towards sustainable development.

Meanwhile, the Dutch Government and investors have shown interest in partnering with Vietnam in trade, industry and energy.

Vietnam has been and will be a good choice for Dutch investors, while the business communities of both sides have sought business and investment opportunities in each other’s country, thus optimising advantages brought about by the EVFTA.

Statistics from the MoIT showed that the Netherlands is the biggest export market of Vietnam in the EU and the largest European investors in Vietnam.

Last year, despite COVID-19 impacts, two-way trade still rose 1.5 percent year on year to over 7.7 billion USD thanks to the EVFTA.

In the first months of 2021, positive signs were still seen in two-way trade despite the record height of transport fee.

According to the General Department of Vietnam Customs, in the first six months of 2021, total trade between Vietnam and the Netherlands hit 4,2 billion USD, up 19.5 percent from the same period last year, accounting for 15 percent of total trade revenue of Vietnam with the whole EU.

Economists attributed the preferential tariff from the EVFTA to Vietnam’s exports to the Netherlands. They affirmed that the prospect is high for the export of consumer goods to the Netherlands as Dutch consumers’ spending is rising./.

Hai Phong grants investment certificate to terminal construction project

The Management Board of Hai Phong Economic Zones on September 27 handed over an investment certificate on a project building terminals 5 and 6 in Hai Phong Port’s Lach Huyen port area to HATECO Group JSC.

The project was given the Prime Minister's approval in principal at Decision No. 299/QD-TTg dated March 4, 2021.

With a combined length of 750 metres, the two terminals will be capable of receiving 8.000-TEU (100,000 DWT) vessels. The project’s total area is 47 hectares.

The project, which has a total cost of over 6.4 trillion VND (nearly 280.3 million USD), also include a berth for 48-TEU vessels or barges, port protection works, and warehouse systems.

Work on the construction of the project is scheduled to start this December. Once completed and put into operation, the terminals are expected to handle 25 million tonnes of goods per year.

General Director of HATECO Group JSC Hoang Dinh Tuan said this is an important project of the firm and it will mobilise all resources to implement the project.

Head of the management board Le Trung Kien said the agency and relevant units will create favourable conditions for the investor to implement the project on schedule.

Terminals No 1 and 2 came into operation in May 2018 and have served container vessels and general ships with a capacity of about 1.1 million TEU per year.

The construction of terminals 5 and 6 is expected to contribute to developing the Lach Huyen port area into an international gateway port, thus meeting the increasing demands of the market and directly bringing the northern region's exports to the European and American markets.

The Hai Phong Port handled 36.2 million tonnes of cargo last year, or more than 40 percent of the total in the city, earning revenue of over 2.19 trillion VND with a profit of 700 billion VND. In the first quarter of this year, it handled 9.3 million tonnes of cargo for 563 billion VND in revenue and 215 billion VND in profit./.

Vietnamese carmaker aims to conquer European high-end electric car market

The Le Monde newspaper of France has recently posted an article reporting that VinFast automaker of Vietnam’s conglomerate Vingroup has entered the high-end electric car market in Europe, as it is expected to launch two models in France and Germany by late 2022.

“Not so long ago, an unknown Vietnamese automaker with ambition to gain a foothold in the premium market would hardly have been taken seriously. Today, the arrival of the VinFast brand is not entirely surprising.

“The electric car has become the horizon of the automobile industry, and technological barriers such as income from the situation inherited from the reign of thermal engines are cracking,” wrote the article.

Since its presence in 2018 at the Paris Motor Show, VinFast has worked hard to build a factory capable of producing 250,000 vehicles per year in the northern port city of Hai Phong, with an investment of 4.4 billion USD, the article continued.

It added that after having produced 30,000 units of thermal models in 2020 based on BMW and General Motors technologies, the Vietnamese manufacturer on September 23 presented two full-size electric vehicles in Italy, which will be marketed at the end of 2022 in the US, Canada, Germany, France and the Netherlands. The range will expand in the following years.

“VinFast will be top-of-the-range cars with top-notch equipment, but at the right price,” assured Thomas Chrétien, the company's marketing director for Europe.

VinFast posts an annual revenue of 16 billion USD, making up over 2 percent of Vietnam’s gross domestic product./.

Tourism sector expects to revive operations soon

The Ministry of Culture, Sports and Tourism is looking forward to quickly resume operations of the tourism industry which was battered by the COVID-19 pandemic.   The Vietnam National Administration of Tourism was asked to work with localities to upgrade tourism products with the goal that each province and city have a unique one as well as connecting tourism products to create highlights for traveling activities.<o:p></o:p> It was necessary for localities that COVID-19 have been put under control,  connect with tourism associations and businesses to organise promotion and investment forums and conferences to revive tourism.<o:p></o:p> The industry would prepare to gradually expand to other destinations throughout the country, continuing to deploy communications activities and stimulate tourism demand based on inheriting the "Vietnamese people travel in Vietnam" and “Vietnam tourism - a safe and attractive destination” programmes.<o:p></o:p> In the first eight months of this year, the number of domestic visitors reached 31.2 million, falling by 5.5 percent year-on-year. The gross revenue of domestic tourism hit 6 billion USD./. <o:p></o:p> Hoa Sen Group posts increase in profit<o:p></o:p> Hoa Sen Group posted revenue of VND4 .7 trillion (US$207.6 million) and after-tax profit of VND320 billion in August, increasing 66 per cent and 47 per cent respectively over the same period last year.<o:p></o:p> The group on Monday announced its high growth despite the COVID-19 pandemic thanks to its increase in selling prices.<o:p></o:p> Its total steel consumption in August reached 167,810 tonnes, representing a 6 per cent year-on-year decrease. Of which, its steel exports accounted for 73 per cent of the total to reach 123,080 tonnes.<o:p></o:p> It said that steel exports have still been the driving force for revenue growth while the domestic market has been heavily affected by the pandemic. In the future, the company will focus on increasing exports to markets such as the US and the EU with high demand and high profit margins.<o:p></o:p> The group expected that its exports to the two markets would increase from 20-50 per cent. It would also wait for domestic steel sheet demand to increase strongly thanks to easing social distancing as production and business activities gradually stabilised in the new situation and construction projects continued to be implemented.<o:p></o:p> In the first 11 months of its financial year 2020-21, its steel sales reached 2 million tonnes, representing a 43 per cent year-on-year increase and surpassing 14 per cent of the whole year’s set target. Its revenue was estimated at VND42.5 trillion and after-tax profit of nearly VND4 trillion, increasing 74 per cent and 279 per cent from the same period last year respectively. These results also helped Hoa Sen Group surpass 29 per cent and 166 per cent of the whole year’s set targets of revenue and profit.<o:p></o:p> SSI Research assessed that the export channel can help Hoa Sen maintain full capacity in the near future.<o:p></o:p> Earlier, the group also said that it can maintain a stable sales volume of at least 160,000-170,000 tonnes a month, bringing in revenue of about VND4.5 trillion revenue thanks to its extensive export growth to more than 87 countries and territories.<o:p></o:p> Hoa Sen targets revenue of VND33 trillion and after-tax profit of VND1.5 trillion in its financial year of 2020-21, representing 20 per cent and 30 per cent year-on-year increases.<o:p></o:p> VinaCapital Ventures acquires stake in Dutycast<o:p></o:p> VinaCapital Group’s technology start-up venture fund VinaCapital Ventures (V2) has recently announced its investment in Dutycast, an assistant in cross-border online shopping.<o:p></o:p> The global e-commerce market was estimated at nearly 994 billion USD (43.2 million USD) in 2020, which is forecast to surge to 2 trillion USD by 2026 with an annual compound growth of around 17.4 percent.<o:p></o:p> Data from the Ministry of Industry and Trade’s Vietnam E-Commerce and Digital Economic Agency showed that the domestic online sales reached approximately 12 billion USD last year, or 5.5 percent of the total retail value nationwide. Vietnam is considered one of the world’s fastest-growing e-commerce markets thanks to young and tech-savvy population and a rapidly expanding middle class.<o:p></o:p> Via Dutycast, users could shop from multiple stores in different countries and check out once. They could pay in their local currency via trusted payment methods and without having to worry about foreign exchange fluctuations.<o:p></o:p> Dutycast was founded in 2020 by a group of experts in technology, global trade and consumer goods, including Nguyen Le Hoa, Dang Vu Tam, Doan Tran Thai Son and Tran Dinh Dat.<o:p></o:p> Earlier in mid-September, VinaCapital Ventures poured capital into GlobalCare, an insurtech company that provides solutions for the sales and administrative processes of insurance agencies and business partners selling non-life insurance policies./. <o:p></o:p> Thai Binh province makes breakthrough in attracting investment<o:p></o:p> With a score of 64.02 points, the northern province of Thai Binh has improved the Provincial Competitiveness Index (PCI) ranking by jumping to 25th out of 63 provinces and cities nationwide last year from 36th in 2006.<o:p></o:p> For the fourth year in a row, the province made its leap in the PCI ranking thanks to its high scores in four out of 10 sub-indices – entry and time costs and regulatory compliance, policy bias, law and order. The province also climbed 13 places to 20th out of 63 provinces and cities nationwide in the 2020 Provincial Governance and Public Administration Performance Index (PAPI) rankings<o:p></o:p> It is the result of improving the investment and business environment in Thai Binh province by 2020, creating a breakthrough in attracting investment to the province.<o:p></o:p> The Provincial Committee of the Party, People's Council and People's Committee always paid attention to and directed and conducted many solutions to improve the investment and business environment, thereby creating favourable conditions for production and business activities and promoting investment attraction into the province<o:p></o:p> To Xuan Thuc, Chairman of Dong Hung district People's Committee said that the district always focuses on dissemination so that officials, party members and people, especially those on official duty, understand the importance of the above-mentioned work and facilitate investors who pour capital in the province.<o:p></o:p> As many as 125 small and medium enterprises were set up in the 2016-2020 period. It attracted two investors who spent money on the technical infrastructure of Do Luong and Dong La industrial clusters and 31 projects in other industrial clusters, bringing the total number of projects to 110 while creating jobs for more than 21,000 employees in the period.<o:p></o:p> Regarding the administrative reform work, the province has utilised all resources to invest in facilities and equipment to serve the operation of the provincial Public Administration Service Centre (PASC) and the one-stop divisions. The provincial People's Committee issued about 500 documents of all kinds in the 2016-2020 period to direct and guide agencies, units and localities to well perform the administrative procedures in the locality. The province has also reviewed and simplified nearly 1,200 administrative procedures and cut at least 40 percent of the time for handling administrative procedures compared to normal ones.<o:p></o:p> Up to 99 percent of people and businesses felt satisfaction when conducting administrative procedures at the provincial PASC.<o:p></o:p> To date, the province has updated more than 1,500 administrative procedures on the National Public Service Portal and integrated more than 500 online public services.<o:p></o:p> Do Van Ve, Chairman of the provincial Business Association said that the implementation of administrative procedures at the PASC has been highly appreciated by investors because favourable conditions have been created for them during the execution of projects.<o:p></o:p> In order to improve the investment and business of the province, it does not only focusing on reforming administrative procedures but also issuing many mechanisms and policies to encourage investment attraction.<o:p></o:p> In addition to the Government’s incentives, the provincial authorities offer their own incentives to new or expanded investment projects in the economic zones. Investors will enjoy incentives in land access, support in the building and operation of technical infrastructure facilities, the building of centralised wastewater treatment systems, site clearance, completion of administrative formalities, and training of human resources.<o:p></o:p> Investment priorities are given to building and commercially operating infrastructure facilities and concentrated wastewater treatment systems of industrial parks and industrial clusters for large-scale, state-of-the-art and environmentally friendly industries; commerce and services; and hi-tech agriculture<o:p></o:p> Attention has been paid to vocational training and human resource development. The province constantly improves the effectiveness of linking vocational training establishments with businesses.<o:p></o:p> Agencies and units in the province have considered administrative reform, improving the investment and business environment as one of the key tasks, contributing to turning it into an attractive destination for both domestic and foreign investors./.<o:p></o:p> Cash assistance programme, faster aid delivery recommended to support people, enterprises<o:p></o:p> A cash assistance programme and faster provision of relief for people with disadvantages caused by the COVID-19 pandemic are among the proposals submitted by experts at a consultation held in Hanoi on September 27.<o:p></o:p> The event, organised by the National Assembly (NA) Office and the parliament’s Committee for Economic Affairs, was chaired by NA Chairman Vuong Dinh Hue and attended by many leading Vietnamese and foreign experts.<o:p></o:p> Terence Jones, UNDP Resident Representative, a.i., said Vietnam has introduced two fiscal measures since the beginning of the pandemic. Resolution 42/NQ-CP on supporting people affected by COVID-19 was issued in April 2020 and included a support package of 62 trillion VND (2.7 billion USD) to aid 20 million workers who had lost jobs due to the pandemic. A new 26 trillion VND support package was announced on July 1, 2021 to help workers affected by lockdowns and social distancing during the most recent wave of infections (Resolution 68/NQ-CP).<o:p></o:p> The Government has taken timely action to reduce the suffering of households that are without income due to loss of employment or earnings from self-employment, he said.<o:p></o:p> However, Jones noted, there is evidence that the support package is neither large enough, nor broad enough in scope, to protect vulnerable households from income loss resulting from lockdowns and social distancing.<o:p></o:p> He recommended a cash assistance programme of 5 percent of quarterly GDP (or approximately 77 trillion VND) be disbursed over the final months of 2021. The multiplier effect of additional consumption spending is greater than one, which means that a 77 trillion VND package would have a much larger impact on total private consumption and national output.<o:p></o:p> To achieve the twin objectives of supporting vulnerable households and stimulating economic growth, the cash assistance programme should be launched as quickly as possible, according to the Acting UNDP Resident Representative.<o:p></o:p> He held that in addition to delivering immediate support, preparations must also be made for medium-term programmes to sustain growth and private consumption if necessary. Supplemental programmes could address issues that cannot be managed in the short term.<o:p></o:p> At the consultation, Can Van Luc, Chief Economist at BIDV and member of the National Advisory Council on Financial and Monetary Policies, said to cope with the pandemic’s impacts, Vietnam issued four aid packages with the announced total value of some 1.1 quadrillion VND. However, the Government and credit institutions have just committed to providing about 184.7 trillion VND, equivalent to 2.94 percent of last year’s GDP.<o:p></o:p> The implementation of fiscal aid and social security packages remains sluggish, with only about 46 percent of the fiscal aid package and 63 percent of the social security one already disbursed, which has partly affected the effectiveness of support of enterprises and people, he noted.<o:p></o:p> Pointing out causes of this problem, he called for prompt and drastic implementation of the launched support packages, elaborating that the Government should quickly make review and preliminary assessment and immediately address obstacles to the deployment.<o:p></o:p> The Government should consider more relief packages worth nearly 40 trillion VND, equivalent to 0.62 percent of the 2020 GDP. It is also necessary to enhance enterprises’ access to capital and liquidity support. Besides, the State Bank of Vietnam should flexibly adjust credit growth limits for credit institutions so that these organisations have more resources for reducing interest rates and supplying credit to aid economic recovery, according to Luc.<o:p></o:p> Strategies and plans for pandemic prevention and control as well as socio-economic development in the new normal should be devised early, the expert said, adding that it is necessary to have new growth drivers and ensure macro-economic stability in order to capitalise on recovery chances and control risks.<o:p></o:p> He also suggested the NA and the Government soon build a legal corridor for managing and developing the digital economy, society, and administration, and that the Government should step up economic restructuring to mobilise and allocate resources more effectively./.<o:p></o:p> COVID-19 causing toughest period to tourism<o:p></o:p> The global tourism, including Vietnam, is facing the toughest period due to complex developments of the COVID-19 pandemic with the appearance of new variants.<o:p></o:p> According to the World Tourism Organisation (UNWTO), the global tourism would lose about 2.4 trillion USD to the pandemic. Countries like Turkey, Educator, South Africa and Ireland are expected to experience decreases in GDP as their industry is slowing down.<o:p></o:p> The United Nations Conference on Trade and Development (UNCTAD) estimates losses in the most pessimistic scenario, a 12-month break in international tourism, at 3.3 trillion USD or 4.2 percent of global GDP.<o:p></o:p> The nosedive in tourist arrivals worldwide in 2020 resulted in a 2.4 trillion USD economic hit, the report said, and a similar figure is expected this year depending on the uptake in COVID-19 vaccines.<o:p></o:p> “The world needs a global vaccination effort that will protect workers, mitigate adverse social effects, and make strategic decisions regarding tourism, taking potential structural changes into account,” said Isabelle Durant, the UNCTAD acting Secretary-General.<o:p></o:p> “Tourism is a lifeline for millions, and advancing vaccination to protect communities and support tourism’s safe restart is critical to the recovery of jobs and generation of much-needed resources.<o:p></o:p> “Recovery of jobs and generation of much-needed resources, especially in developing countries, many of which are highly dependent on international tourism,” UNWTO Secretary-General Zurab Pololikashvili said.<o:p></o:p> According to the report, international tourist arrivals declined by about 1 billion (or 73 percent) in 2020, while in the first quarter of 2021 the drop hovered around 88 percent.<o:p></o:p> Countries in Northeast Asia, Southeast Asia, Oceania, North Africa and South Asia are the most affected, mainly due to a lack of COVID-19 vaccines.<o:p></o:p> Vietnamese tourism bottoms down<o:p></o:p> The tourism sector was supposed to get back on track after the third outbreak. However, the fourth wave has extinguished the hope due to the appearance of new variants.<o:p></o:p> According to statistics from Google Destination Insights, since late April when the latest wave of COVID-19 hit Vietnam, the volume of domestic tourists searching for travel information has dropped sharply to a very low level.<o:p></o:p> Data from the Vietnam National Administration of Tourism also showed that the number of domestic visitors fell from 9 million in April to 3.5 million in May and 0.5 million in July.<o:p></o:p> Demand for seeking information about tourism accommodation services has plunged since May. In major tourist destinations nationwide, the rate of room cancelation has exceeded 90 percent and lodging facilities been forced to close on a large scale.<o:p></o:p> The entire nation logged 4.6 million in-house tourists in April, but the figure dropped to 1.8 million in May, 0.9 million in June, and 0.3 million in July.<o:p></o:p> Following the downward trend, demand for aviation information between May and now declined by 85 percent compared to the same period last year.<o:p></o:p> According to Google Destination Insights, the top searched domestic destinations included Ho Chi Minh City, Da Lat, Phu Quoc, Hanoi, Da Nang, and Nha Trang.<o:p></o:p> Such figures show that the domestic tourism is facing the hardest time in its history. In the coming time, even when COVID-19 is put under control and tourism activities gradually return to normal, people need to comply with the “5K” epidemic prevention regulations of the Ministry of Health - khau trang (facemask), khu khuan (disinfection), khoang cach (distance), khong tu tap (no gathering) and khai bao y te (health declaration).<o:p></o:p> It is impossible to foresee the danger of the SAR-CoV-2 virus, so everyone should develop safe travel habits to protect themselves and the community.<o:p></o:p> Experts propose three phases for post-pandemic economic development<o:p></o:p> Experts shared opinions and proposed measures to promote quality and sustainable socio-economic development amidst and after the COVID-19 pandemic at a consultation chaired by National Assembly Vuong Dinh Hue on September 27.<o:p></o:p> According to Dr Tran Thi Hong Minh, Director of the Central Institute for Economic Management (CIEM), international organizations have made optimistic, though cautious, assessments on global economic recovery momentum in 2021.<o:p></o:p> However, research and policy discussions shared the view that the world economic growth recovery is still under the influence of three main risk groups, including complicated developments of the COVID-19 pandemic, geopolitical competition, and inflation and debt risks, she went on.<o:p></o:p> Vietnam's economic prospects may be influenced by a number of factors, including the ability to control the COVID-19 pandemic, the disbursement of public investment, and the ability to ensure production recovery, implement an extensive programme on economic recovery and development and take advantage of the global economy recovery, Minh said.<o:p></o:p> The institute proposed three phases in the economic recovery programme, with the first one (to last until the first quarter of 2022) to prioritise pandemic prevention and control in combination with macro-economic policies to help businesses survive the difficult situation. The second phase will last through 2023, during which macroeconomic policies should be relaxed to stimulate demand for the economy and create momentum for businesses. In the third phase in the years after 2023, macroeconomic policies will be normalized, the macroeconomic foundation strengthened and more intensive economic institutional reform promoted.<o:p></o:p> The institute stressed the need to apply flexibly macroeconomic policies in line with scenarios to cope with adverse developments of the world and regional economy, promote export diversification, encourage new economic models in the domestic market, and speed up the implementation of support packages for people and businesses.<o:p></o:p> Minh suggested the National Assembly pay special attention to law-making work in order to reduce overlap, thus strengthening the legal framework for production and business activities.<o:p></o:p> A representative from the World Bank proposed four lessons to accelerate the recovery process in Vietnam and help the country enter the new normal situation.<o:p></o:p> The WB underlined the importance of vaccination against COVID-19 along with testing in controlling the pandemic and minimizing economic losses, adding that it is necessary to find a suitable balance between fiscal policy and monetary policy, and increase social assistance to prevent financial distress among vulnerable groups and inequality from widening.<o:p></o:p> Vietnam needs to strengthen its resilience through a strong and flexible social assistance system, it said, recommending allocating more capital social assistance programme./.<o:p></o:p> Vietnam advised to attract more FDI to boost economic growth<o:p></o:p> Despite a decrease in foreign direct investment (FDI) inflows into Vietnam in recent months due to the impact of the COVID-19 pandemic, economists assessed Vietnam remains attractive to foreign investors and needs to take advantage of FDI attraction opportunities to boost economic growth.<o:p></o:p> According to The Australia Financial Review, Vietnam is likely to remain foreign investors’ favoured destination. Though rapidly rising Delta COVID-19 infections have hit manufacturing in Ho Chi Minh City, Vietnam’s commercial hub, the big-picture story of Vietnam being a favoured destination for foreign investment is not expected to change, the daily newspaper said. Even as forecasts are trimmed, economists have faith the nation will bounce back.<o:p></o:p> “In recent decades, Vietnam has excelled in reeling in the big fish in electronics, footwear and clothing,” it said. “Low labour costs, reliable infrastructure and a smooth bureaucratic process have attracted the likes of Samsung, Foxconn, Nike, Adidas, Gap and Levis.”<o:p></o:p> As of September 20, FDI inflows into Vietnam increased by 4.4 percent year-on-year to 22.15 billion USD, reported the Foreign Investment Agency under the Ministry of Planning and Investment.<o:p></o:p> In the period, 12.5 billion USD was poured into 1,212 newly-licensed projects, up 20.6 percent in value but the number of projects was down 37.8 percent over the same period last year. Meanwhile, 6.6 billion USD was added into 678 underway projects, a year-on-year rise of 25.6 percent in capital but down 15.8 percent in project number. Foreign investors also invested nearly 3.2 billion USD to share purchase deals, down 43.8 percent compared to the same period last year.<o:p></o:p> The agency attributed the decreases in the numbers of new and expanded projects to the travel restrictions and long quarantine policy, which made it hard for foreign investors to make surveys for their planned projects. Lockdown and travel restriction measures also affected operations of FDI firms.<o:p></o:p> Nguyen Van Toan, Vice Chairman of the Vietnam Association of Foreign Invested Enterprises, stated that due to serious impact of the pandemic, many FDI enterprises faced difficulties in production and business activities. However, these difficulties are only temporary and the possibility of foreign investors moving their supply chain out of Vietnam is very small.<o:p></o:p> Moving a factory out of one country to set up another in other country is very complicated. Therefore, in the immediate future, FDI enterprises have not yet moved out of Vietnam, but they may have to push some orders to other production facilities to avoid supply chain disruption, Toan added.<o:p></o:p> Trinh Van Quang, Vina CPK Project Development Manager, said that Vietnam is still considered a country benefiting from the wave of investment shift. This once again confirms that Vietnam's investment environment is really attractive to FDI investors, not just because of the advantage of cheap labour and low rental costs compared to other countries in the region.<o:p></o:p> This shows that Vietnam’s policies and socio-political stability are a competitive advantage in comparison with others in the region, Quang said.<o:p></o:p> To ease the impact of the COVID-19 pandemic, economists stressed the necessity to keep a close watch on the pandemic developments so as to have timely solutions to attract and maintain FDI inflows.<o:p></o:p> Economist Nguyen Bich Lam, former Director of the General Statistics Office, proposed the Government support foreign investors and accompany them to overcome current difficulties by such measures as stepping up vaccination, and devising long-term policies to ensure their interests.<o:p></o:p> At a recent meeting with Prime Minister Pham Minh Chinh, the European Chamber of Commerce (EuroCham) made many recommendations to the Government, including speeding up vaccination for workers, and adjusting the current “three-on-site”, and “one road, two destinations” strategies as they place a huge burden on both companies and their workers in practice.<o:p></o:p> Experts advised Vietnam to focus on stepping up administrative reform, which will bring practical benefits to investors.<o:p></o:p> Another suggestion is that Vietnam should work to access investors from new markets. Deputy Minister of Planning and Investment Nguyen Thi Bich Ngoc said that the Middle East has always been considered a region with great potential for investment cooperation. However, at present, investment from this region into Vietnam is still limited. To attract investment flows from this market, she proposed studying cooperation models with a third party to jointly invest in large projects in Vietnam, and building a cooperation mechanism connecting large investment funds of the Middle East in the development of large infrastructure projects in the Southeast Asian nation./.<o:p></o:p> Vietnam-US trade ties enjoy “spectacular” growth<o:p></o:p> The Vietnam-US trade ties have enjoyed impressive growth during 26 years since the normalization of diplomatic ties.<o:p></o:p> Looking back at the past 20 years in international trade, there is no relationship which has such a fast growth rate like that of the Vietnam-US trade relationship, said Nguyen Xuan Thanh, senior lecturer at Fulbright School of Public Policy and Management in Vietnam.<o:p></o:p> Prof. David Dapice, leading expert on development economics in Southeast Asia, Harvard Kennedy School, Harvard University, used the word “spectacular” to describe the development of economic cooperation between Vietnam and the US.<o:p></o:p> Two-way trade rose from over 400 million USD in 1995 to more than 90 billion USD in 2020.<o:p></o:p> Vietnam’s total export turnover to the US from 1 billion USD in 2000 increased to 10 billion USD in 2007, mainly thanks to the bilateral trade agreement taking effect in 2001. After 2007, Vietnam's exports continued to increase, partly due to the shift in the global supply chain, as foreign investors entered Vietnam to take advantage of cheap labour, David Dapice stated.<o:p></o:p> Over the last five years, Vietnam’s export value to the US has increased by 230 percent, while exports from the US to Vietnam have also jumped 175 percent. The US has become Vietnam's largest importer, while the latter has become the former’s 10th largest trading partner.<o:p></o:p> Deputy Foreign Minister Nguyen Quoc Dung emphasized that the Vietnam – US relations have made significant strides since 1995, with the most salient aspect being the economic cooperation. With a comprehensive partnership, trade and investment flows from the US have paved the way for Vietnam to further its international economic integration and gradually boost growth, thereby moving away from the status of a less developed to a middle-income country.<o:p></o:p> For US businesses, Vietnam’s fast-growing market of 100 million people with a young, industrious workforce seems to be highly promising. The country’s increasing demands for development and its being situated in one of the most dynamically growing areas of the world also offer great opportunities likewise.<o:p></o:p> Meanwhile, the US, as the biggest importer in the world with abundant capital and technology, is a potential destination for Vietnamese exporters.<o:p></o:p> What is more important is that the governments and business communities of both countries want to promote economic and trade cooperation./.<o:p></o:p> Samsung CEO: Vietnamese market remains attractive for foreign investors<o:p></o:p> Despite the negative impact caused by the prolonged COVID-19 outbreak, Vietnam remains an attractive destination for foreign investors over the long run, Choi Joo-ho, CEO of Samsung Vietnam, told local media outlets on September 27. According to the CEO, Vietnam provides an attractive investment environment thanks to its abundant labour force, socio-political stability, modern production infrastructure, and numerous investment incentives. <o:p></o:p> Vietnam will maintain its FDI inflows and growth in the near future, providing that it effectively implements COVID-19 prevention measures, alongside maintaining production and supply chains, said Choi.<o:p></o:p> He stated that Samsung supports the Vietnamese Government’s ongoing policy relating to effective pandemic control and economic growth, and believes that the prolonged outbreak will soon be brought under control nationwide, especially in Ho Chi Minh City and other industrial clusters in the south.<o:p></o:p> Choi revealed that since Samsung initially entered the Vietnamese market in 2008, it has poured a total of US$17.7 billion into the nation, becoming a key global production base with six manufacturing plants in Bac Ninh, Thai Nguyen, and Ho Chi Minh City.<o:p></o:p> Its US$200 million research and development (R&D) centre which broke ground in Hanoi in 2020 and is expected to be completed in 2022, will primarily focus on global science and technology development trends, with things such as artificial intelligence (AI), the Internet of Things (IoT), big data, and 5G networks, in order to help support Vietnam's digital transformation and anticipate changes relating to Industry 4.0.<o:p></o:p> Samsung will try its best in order to contribute to the nation’s rapid economic recovery process moving into the post pandemic period, said the CEO.<o:p></o:p> Vingroup wants to build 650-hectare park in Ha Long<o:p></o:p> Vingroup is lobbying to build a 650-hectare park in the northern province of Quang Ninh’s Ha Long City.<o:p></o:p> Vingroup’s proposed Ha Long Forest Park would be located in Ha Khau and Dai Yen wards near the group’s Ha Long Green complex project approved by the prime minister.<o:p></o:p> Vingroup wants to start the Ha Long Forest Park project in 2022 and complete it in 2023. They claim it could be an attractive tourist spot in Ha Long City.<o:p></o:p> According to Ha Long City’s urban management board, the proposed site is on the outskirts of the city, but it faces a high risk of landslides. Therefore, Vingroup’s proposal needs to be carefully considered by local authorities.<o:p></o:p> Quang Ninh has reopened some tourism activities for visitors following a long suspension due to Covid-19. However, tourists who want to come to Quang Ninh have to be fully vaccinated and have had a negative Covid-19 test result for 48 hours before visiting. <o:p></o:p> Standard Chartered forecasts fourth-quarter growth in Vietnam at 5.5 per cent<o:p></o:p> Standard Chartered expects Vietnam’s GDP growth to recover to 5.5 per cent on-year in the fourth quarter of 2021.<o:p></o:p> The bank sees downside risks to the forecast – and a potential interest rate cut – if the economic impact of Vietnam’s COVID-19 outbreak is prolonged. Such a scenario could affect Vietnam’s external position.<o:p></o:p> According to Standard Chartered, GDP growth in the third quarter may likely have slowed to 1.9 per cent on-year, from 6.6 per cent in the second quarter, as the pandemic hit the economy.<o:p></o:p> Ealier this month, the bank had revised its GDP growth forecasts for Vietnam for 2021 to 4.7 per cent from 6.5 per cent and 7.0 per cent from 7.3 per cent for 2022 due to softening economic indicators, the worsening pandemic, and a still-slow vaccination rollout.<o:p></o:p> Standard Chartered anticipates a further downgrade and an interest rate cut by the State Bank of Vietnam if COVID-19 cases are not brought under control by September.<o:p></o:p> It sees a rebound in the fourth quarter and expects trade data to remain supported by improving global trade. Softer economic growth is expected in the third quarter of this year, Standard Chartered noted. <o:p></o:p> 150,000 Covid-19 cases to be added to the tally<o:p></o:p> HCM City has proposed to the Ministry of Health to include 150,000 new Covid-19 patients who have been detected through quick testing since late August into the national tally.<o:p></o:p> The HCM City CDC said that by the end of September 27, the city had reported 375,794 Covid-19 infection cases via RT-PCR tests, including nearly 500 imported cases.<o:p></o:p> According to the Ministry of Health, only people who are tested positive via RT-PCR tests can be added to the national tally. However, the city has recorded 150,000 positive cases via quick tests since August 20. These cases have shown symptoms and have been monitored and treated at home.<o:p></o:p> The Ministry of Health said on September 27 that they were reviewing the proposal. If the ministry agrees with the proposal, HCM City will have over 525,000 positive cases.<o:p></o:p> The number of Covid-19 cases in HCM City accounts for about 50% of the total national tally and the number of Covid-19-related deaths accounts for 80% of the country's fatalities. As the outbreak is being contained, the fatality rate has also dropped down greatly.<o:p></o:p> The Ministry of Health said since the number of patients had reduced, they would gradually allow health workers, who were sent to HCM City during the peak of the outbreak, back to their home provinces and cities.<o:p></o:p> Ministry proposes extending excise tax payments for local auto firms<o:p></o:p> The Ministry of Finance has proposed the Government continue extending the payments of excise tax by local auto manufacturers and assemblers until the end of 2021.<o:p></o:p> The proposal was made after the Government on September 9 issued Resolution 105 providing support for enterprises, cooperatives and household businesses impacted by the Covid-19 pandemic, asking the ministry to consider the payment extension of excise tax, or special consumption tax, for domestically manufactured or assembled cars.<o:p></o:p> The ministry also proposed the Government allow it to build a decree with shortened procedures.<o:p></o:p> Since early 2021, the pandemic has taken a heavy toll on the automobile manufacturing and assembly sector, so it is necessary to offer support policies for local auto firms, according to the ministry.<o:p></o:p> Data from the Vietnam Automobile Manufacturers Association (VAMA) indicated that between January and August, the number of autos locally produced and assembled by VAMA members dropped by 13% against the same period of 2019, when the pandemic was yet to break out in Vietnam. Several local auto firms have reported a sharp drop of over 60% in auto sales.<o:p></o:p> Earlier in 2020, the Government issued Decree No. 109 allowing local auto firms to enjoy excise tax payment extensions.<o:p></o:p> Under the decree, the payment deadline of the March excise tax was extended to September 20, 2020, while the April and May deadlines were extended to October 20 and November 20, 2020, respectively. The excise tax payment deadlines for the remaining five months were extended to December 20, 2020.<o:p></o:p> The extension helped eliminate the financial difficulties facing local auto manufacturers and assemblers amid the coronavirus pandemic, the local media reported.<o:p></o:p> The Government’s Decree 109 and Decree 70 allowing a 50% registration fee cut for customers who buy locally produced and assembled cars have boosted domestic auto production, according to the ministry.<o:p></o:p> Vietnamese carmaker aims to conquer European high-end electric car market<o:p></o:p> The Le Monde newspaper of France has recently posted an article reporting that VinFast automaker of Viet Nam’s conglomerate Vingroup has entered the high-end electric car market in Europe, as it is expected to launch two models in France and Germany by late 2022.<o:p></o:p> “Not so long ago, an unknown Vietnamese automaker with ambition to gain a foothold in the premium market would hardly have been taken seriously. Today, the arrival of the VinFast brand is not entirely surprising.<o:p></o:p> “The electric car has become the horizon of the automobile industry, and technological barriers such as income from the situation inherited from the reign of thermal engines are cracking,” wrote the article.<o:p></o:p> Since its presence in 2018 at the Paris Motor Show, VinFast has worked hard to build a factory capable of producing 250,000 vehicles per year in the northern port city of Hai Phong, with an investment of US$4.4 billion, the article continued.<o:p></o:p> It added that after having produced 30,000 units in 2020 based on BMW and General Motors technologies, the Vietnamese manufacturer on September 23 presented two full-size electric vehicles in Italy, which will be marketed at the end of 2022 in the US, Canada, Germany, France and the Netherlands. The range will expand in the following years.<o:p></o:p> “VinFast will be top-of-the-range cars with top-notch equipment, but at the right price,” assured Thomas Chretien, the company's marketing director for Europe.<o:p></o:p> VinFast posts an annual revenue of $16 billion, making up over 2 per cent of Viet Nam’s gross domestic product. <o:p></o:p> Bac Ninh to spend over 150 billion VND in supporting industry development<o:p></o:p> The People's Committee of Bac Ninh province has approved a programme on the development of supporting industries for the 2021 – 2025 period with total funding of nearly 154 billion VND.<o:p></o:p> Accordingly, Bac Ninh aims to develop supporting industries based on the province's development needs and in accordance with requirements and orientations on Bac Ninh's industrial development.<o:p></o:p> The province targets to become a city with modern, hi-tech industry by 2030, and a smart, hi-tech industrial city by 2045.<o:p></o:p> Bac Ninh advocates to promoting the development of supporting industries via raising the competitiveness of supporting industry enterprises and attracting investments from various economic sectors, thereby increasing the number of supporting industry firms.<o:p></o:p> By 2025, Bac Ninh will have about 800 enterprises operating in supporting industries which participate in the global supply chain. Of them, 70 percent apply the management system meeting requirements of global production chains in corporate governance and production management.<o:p></o:p> Total funding for the implementation of the programme approved by the Provincial People's Committee in the 2021 - 2025 period is 153.97 billion VND (6.74 million USD), including 113.94 billion VND from from the State budget and more than 40 billion VND from other sources.<o:p></o:p> The Bac Ninh provincial People's Committee has assigned the Department of Industry and Trade to coordinate with other departments, sectors and People's Committees of districts, towns and cities in implementing the programme./. <o:p></o:p> Women-led SMEs helped to better access ADB-funded COVID-19 financial relief<o:p></o:p> A enterprise-bank connecting programme was held virtually on September 27 to introduce and discuss about the 5-million-USD COVID-19 relief provided by the Women Entrepreneurs Finance Initiative (We-Fi) to support women-led Small and Medium-Sized Enterprises (SMEs).<o:p></o:p> The event was co-hosted by the Asian Development Bank (ADB), the State Bank of Vietnam, and the Vietnam Chamber of Commerce and Industry (VCCI)’s Vietnam Women Entrepreneurs Council (VWEC), gathering over 300 representatives from women-led SMEs from all over the country.<o:p></o:p> It offered a platform for banks and enterprises to discuss procedures and conditions to apply for the grant.<o:p></o:p> The programme formed part of the VWEC’s efforts to help women-led SMEs access the ADB-run COVID-19 Relief for Women-Led Small and Medium-Sized Enterprises Project which is being implemented by five Vietnamese banks – Asia Commercial Joint Stock Bank (ACB), Bank for Investments and Development of Vietnam (BIDV), Saigon-Hanoi Commercial Joint Stock Bank (SHB), Tien Phong Commercial Joint Stock Bank (TPBank), and Vietnam Prosperity Joint Stock Commercial Bank (VPBank).<o:p></o:p> Speaking at the event, VWEC President Nguyen Thi Tuyet Minh said impacts of the COVID-19 have caused troubles for many enterprises, particularly women-led SMEs. It is critical to implement the project as fast as possible to effectively aid the affected businesses, she noted.<o:p></o:p> The programme aims to promptly respond to the current difficult time and it requires the cooperation of all stakeholders, including the ADB, the government, the five banks, VCCI and industry associations, Don Lambert, head of the Private Sector Development Unit at ADB Vietnam. It will help deliver the relief as quickly as possible to women-led SMEs suffering financial losses due to COVID-19, he added./. <o:p></o:p> Vietnam exports over 15 million medical masks in August<o:p></o:p> The General Department of Vietnam Customs reported Vietnam exported over 15 million medical masks of all kinds during August, up 24.8 percent compared to the same period in 2020.<o:p></o:p> In the first eight months of the year, domestic enterprises have exported over 305.6 million medical masks of all kinds, with January seeing a record high of 64.7 million masks.<o:p></o:p> The number of enterprises engaging in medical equipment export have also significantly dropped, from over 100 to only 12 at present, due to increasing orders for traditional products. In addition, some countries are gradually getting the coronavirus disease under control thanks to the speeding up of inoculation drives./.<o:p></o:p> Potential grows for vegetable and fruit exports to US<o:p></o:p> The US is a potential market for Vietnamese fruit and vegetable exports thanks to the diverse distribution system along with a 3-million-strong overseas Vietnamese community, according to the Vietnamese Trade Office in the US.<o:p></o:p> The US market is home to 332 million customers with high per capita income, with fruit and vegetables being a rising trend, it said.<o:p></o:p> Data from the Vietnam Fruit and Vegetable Association showed that fruit and vegetable exports were worth over 2.06 billion USD in the first half of this year, a year-on-year increase of 17.4 percent.<o:p></o:p> Of these, the shipment of these items to the US enjoyed the highest growth of 132 percent compared to the same period last year, followed by China and China with 11.6 percent and 109 percent.<o:p></o:p> Nguyen Quoc Toan, Director-General of the General Department for Agricultural Products Processing and Market Development, said Vietnamese fruit and vegetables are enjoying preferential tariffs brought by free trade agreements, including EU-Vietnam Free Trade Agreement and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.<o:p></o:p> Six types of fresh Vietnamese fruits are allowed to enter the US market including mango, longan, lychee, dragon fruit, rambutan, and star apple. Other fruits can also be exported in either frozen or processed forms.<o:p></o:p> Despite having certain advantages, however, the country still faces numerous hurdles because it had to cope with fierce competition from products that are grown in such states as Florida and California or similar items from Mexico, South American and Asian countries.<o:p></o:p> The high costs for transportation and storage due to geographical distance is causing difficulties for the export of fresh fruits to the US.<o:p></o:p> The Vietnamese Trade Office in the US suggested local enterprises coordinate with US counterparts for a flexible payment method to increase exports to the market. They were also urged to consider pouring capital into cold storage to ensure the quality of fresh fruits as well as setting up a large-scale distribution centre for Vietnamese goods at a large port on the West Coast, it said, saying that this would help reduce costs and help make businesses more proactive in selling the products.<o:p></o:p> It is necessary for Vietnamese enterprises to continue approaching large distribution chains, aiming to provide organic and processed products to meet the demand of the US market, the office said./.<o:p></o:p> Source: VNA/VNS/VOV/VIR/SGT/SGGP/Nhan Dan/Hanoitimes<o:p></o:p> </td> </tr> </table>

Kinhbac English

Thứ Tư, 29 tháng 9, 2021

VIETNAM BUSINESS NEWS SEPTEMBER 29

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