VIETNAM BUSINESS NEWS OCTOBER 611:01 Enterprises survive the COVID-19 storm
The COVID-19 pandemic has hit Vietnamese enterprises in a wide range of industries but many of them have found ways to effectively mitigate the pandemic’s impact on their business, maintain production and ensure the growth of revenues and profits. In the steel sector, several enterprises such as Hoa Sen Group (HSG) survived the COVID storm thanks to their export markets. HSG reported revenue and after-tax profit of VND4.7 trillion (over US$200 million) and VND320 billion ($13.7 million) in August, representing 66 and 47 per cent year-on-year increases, respectively. The figures were reported by Nguoi Lao Dong (Labourer) newspaper, citing the group’s consolidated business results sent to the State Securities Commission and the Ho Chi Minh Stock Exchange on September 27. In 11 months of the fiscal year 2020-21, HSG estimated its total production output at over two million tonnes, far exceeding its initial plan of 1.8 million tonnes and surging 43 per cent year-on-year. The group’s revenue in the reviewed period reached over VND42.5 trillion, nearly double that of the same period in the prior financial year, while its profit after tax reached an estimated VND4 trillion compared to VND1 trillion seen in the same period. The newspaper quoted a representative of HSG as saying that export was one of the group’s two main sales channels as its products were being shipped to over 87 countries and territories. Amid the global outbreak of the COVID-19 pandemic, HSG's export volume still grew strongly. Data from the Viet Nam Steel Association showed that in the first half of 2021, the group’s galvanised steel export volume accounted for more than 42 per cent of the whole industry's galvanised steel exports. It had signed contracts to export over 120,000 tonnes of this product each month until the end of November. A deep-water seaport located at its factory, which enabled the group to ship steel products to overseas markets, helped HSG gain a competitive edge in exports. In August alone, HSG produced 681,000 tonnes of crude steel, up 40 per cent over the same period of last year, while its sales volume of steel products reached 690,000 tonnes. In the field of confectionery, KIDO is among enterprises that are promptly changing development goals and branching into new businesses in order to turn disaster into opportunity and better meet the needs of local customers. Amid the social distancing period, KIDO has focused on researching activities to churn out new and unique products which are different to those of other enterprises in the industry. Besides ice cream, milk tea, tea and coffee, branded Chuk Chuk, the firm is also offering other products such as green mango juice with chili salt and red guava juice. Meanwhile, many enterprises in the wood industry have made great efforts to implement the "3 on-site" model to ensure the supply chain and fulfil export orders. That has contributed to $11.14 billion export turnover the industry gained in the nine-month period, up 31 per cent over the same period last year. The firms have also modern technologies and equipment to partly meet the needs of automation, reducing the pressure on labourers, enjoying opportunities to seek new customers, according to Ngo Sy Hoai, vice chairman of the Viet Nam Timber and Forest Products Association. Most businesses in the industry have provided vaccinations for their workers, and they expected that a "safe and flexible adaptation and effective control of the COVID-19 pandemic" strategic policy would create opportunities for the whole sector to resume production and meet increasing export orders in the last months of the year, Hoai added. The wood industry was striving to reap about $16 billion from exports by the end of this year, much higher than $12.3 billion seen in 2020, according to the association. Similarly, fruit and vegetable exporters brought home nearly $2.75 billion from January-September, up 10.4 per cent year-on-year, said the Viet Nam Fruit and Vegetable Association. In September alone, their exports were estimated at over $232 million, up 1.52 per cent over the previous month as goods circulation improved, leading to a slight increase in export value, General Secretary of the association Dang Phuc Nguyen told the newspaper. Demand from overseas markets such as China, Japan Russia, the US and Australia, which increased between 23 per cent and 46 per cent, also helped the industry's export picture improve, Nguyen said. Agricultural sector likely to achieve US$44 bln export target despite COVID-19 The agricultural sector is expected to meet its set
target of earning US$44 billion from exports this year following its impressive
performance over the past nine months despite the negative COVID-19 impact. Its agro-forestry and fishery export turnover over the past nine months was estimated at US$35.5 billion, up 17.7% year on year, said Nguyen Van Viet, head of the MARD’s Planning Department, at a press briefing in Hanoi on October 5. MARD statistics show that the group of key agricultural products secured a positive export growth rate of 14.4% compared to the same period in 2020. Meanwhile, forest products, seafood and livestock products obtained export growth rates of 31.6%, 2.4% and 17.5% year on year. The United States emerged as the largest consumer of Vietnamese farm products, spending US$10.2 billion in nine months, or nearly one third of Vietnam’s total agricultural export value. It was followed by China, Japan and the Republic of Korea that imported US$6.8 billion, US$2.4 billion and US$ 1.6 billion worth of farm products from Vietnam. It is expected that the agro-forestry and fishery export value will hit US$44 billion, meeting the agricultural sector’ set target, said Viet. Although the sector posted an impressive export growth rate of more than 17% over nine months, it just enjoyed a trade surplus of just US$3.3 billion, down 55% compared to the US$7.5 billion figure recorded in the same period last year. Viet said the agricultural sector is also facing many risks due to the complicated developments of the prolonged COVID-19 outbreak. In the fourth quarter, the sector heavily relies on livestock and fishery farming, but both services are currently meeting many difficulties. The selling price of products remains low while the purchasing price of input materials, especially animal and aquaculture feed, is still high, said Viet. MARD deputy minister Phung Duc Tien also admitted challenges lie ahead for the sector to meet the US$44 billion export target this year given the current context. Among the four outlined tasks, Tien said the sector will promote market development, remove barriers, and create conditions for domestic consumption and export, with a primary focus on digital transformation and electronic transactions. The sector will coordinate closely with ministries, agencies, localities and craft associations to resolve technical difficulties, facilitate customs clearance and logistics infrastructure in parallel with international trade promotions, while keeping businesses abreast of export market information and implementation of free trade agreements. In addition, the sector will strengthen natural disaster prevention and control measures in order to minimize damage to the economy, production and farmers’ lives. More firms upbeat about business performance in Q4 The number of surveyed firms in Ho Chi Minh City expressing optimism about business performance in the fourth quarter of this year has surged to 49.4 percent, the General Statistics Office (GSO) has reported. In a survey conducted by the GSO, 50.6 percent of the enterprises in the city said they anticipated more difficulties in the last quarter of the year. Meanwhile, 73.7 percent of respondents nationwide were optimistic about their business performance in the fourth quarter. Those predicting more difficulties ahead dropped to 26.3 percent. Due to complicated developments of the COVID-19 pandemic across the country, especially in 19 southern cities and provinces, only 38.6 percent of the surveyed enterprises said they performed better in the third quarter than the previous three months. The remainders said they still met difficulties in production and business. In Ho Chi Minh City alone, only 9.7 percent said their operations in the third quarter were more stable compared to the second quarter. Meanwhile, up to 90.3 percent said they had to struggle with a range of difficulties./. AC Energy, BIM Group initiate US$155 million local wind farm project in Vietnam The US Cable News Network (CNN) and business magazine Forbes have published a recent article on the official commercial operation of a US$155 million wind farm project in the nation which is a joint venture between AC Energy of the Philippines and Hanoi-based BIM Group. Located in the south-central province of Ninh Thuan, the 88MW-solar and wind farm project has served to turn the country into the AC Energy’s second largest market, behind only the Philippines. AC Energy said the project, which is being completed in partnership with BIM Group, has served to boost the group's renewable capacity in the country to 1,000 megawatts (MW) and is composed of facilities which are already operational or under construction. Once the wind farm starts to operate at full throttle, AC Energy said it will be capable of producing 327 gigawatt-hours annually, "enough to power around 50,000 homes per year with renewable energy." "We are very excited to bring this new project into commercial operations ahead of the FeedIn Tariff deadline, notwithstanding the many challenges brought about by the COVID-19 pandemic," Patrice Clausse, chief operating officer of AC Energy International, was quoted as saying during a disclosure to the local bourse on Monday. "As we continue to carve a niche for ourselves by developing some of the most notable renewable energy plants in Vietnam to date, we will continue to accelerate our investments in renewables in the country and aid in its goal to increase the share of renewables in their energy mix," she added. Furthermore, leading Philippine newspaper Manila Bulletin quoted Doan Quoc Huy, vice chairman of the Board of Directors and General Director of BIM Group, as saying that the wind farm project in Ninh Thuan has affirmed the group’s experience, determination, and management capacity in implementing its projects, he noted Following the 405MW solar power plant cluster project in Ninh Thuan, the latest co-operation between BIM Group and AC Enegy in Ninh Thuan province has made the region into the largest salt and renewable energy economic zone in the country. As a result, it has contributed to ensuring sustainable economic development, environmental protection, and building a clean energy source for the future. Vietnamese startups seeks opportunities at AsiaBerlin Submit 2021 Four Vietnamese startups in the fields of
electric vehicles, energy efficiency, smart agriculture and circular economy
will introduce their innovative solutions at the AsiaBerlin Submit 2021. The next presentation will be by Plastic People
specialising in turning plastic waste into useful products; and Hachi which
applies IoT in smart farming. HCM City calendar producers hope to speed up production to meet year-end demand Calendar producers in HCM City have resumed work after the city lifted its lockdown to ensure they can supply the domestic and foreign markets for the upcoming New Year. When the lockdown was in place, most suspended operations since they could not manage to house their workers on-site. They also had difficulty getting raw materials since paper and accessories suppliers had difficulty transporting goods to the city. Some did get fully vaccinated employees to work on-site after September 15 to start meeting orders and prepare for normal production after the city eased social distancing. Nguyen Minh Tuan, deputy general director of An Hao Calendar Company, said his company had suspended operations for many months when the city locked down to contain the COVID-19 outbreak. Now, with the city reopening, it “is trying to catch up with the production schedule to ensure supply to the market at the year-end.” The calendar market usually starts buzzing in mid-October, when producers start supplying customers and also have to meet large orders from big businesses in the domestic market and export to countries with large populations of Vietnamese expatriates. The most important task is printing sheets of block calendars after obtaining the licence, and companies in the industry said this had not been done for many months, and it would be necessary to speed it up now. This required recruiting seasonal employees for production and transportation, Tuan said. “There are certain stages that need seasonal staff, especially during the rush production period. But we still do not know what requirements we will have to meet when we recruit seasonal workers.” Many calendar producers have made plans based on the city’s gradual opening schedule to both ensure safety and timely supply of goods to the market. “Our company has a roadmap with three phases,” Tuan said. “Thirty per cent of our employees returned to work on October 1. Although we want more workers, safety is very important. We are rushing production to promptly supply the market.” E-commerce platforms race to launch promotions after reopening E-commerce and delivery platforms in HCM City are launching a slew of promotions as the city eases social distancing after they remained closed or faced restrictions for a long period amid lockdowns. Food delivery app ShopeeFood has ‘October 10 - Brand Party’ with incentives for its drivers, restaurants and app users after it resumed its services following several months of closure. The two-week event until October 10 offers users a 50 per cent discount on its own meals, 10 million discount vouchers worth up to VND 101,000 and free delivery. It will support drivers’ cost of COVID-19 testing with VND500,000 (US$21.7) per week if they deliver over 60 orders between September 24 and 30. It also offers a ‘ShopeeFood Driver Support Package’ with support of VND1 million (US$43.4) per delivery driver. ShopeeFood has cut its advertising support fee for restaurants and eateries. Another e-commerce platform, Lazada, also realising that the easing of social distancing has sparked a race to gain market share, has announced attractive promotions under its ‘October 10 Shopping Festival’ from October 10 to 14. It will offer customers discount vouchers up to VND400,000 and free shipping nation-wide. From October 5-13 Tiki also has millions of super cheap deals, coupons for VND1 million discounts, VND10,000 same price programme for many products, discounts up to 50 per cent, and free delivery. Analysts said the competition between e-commerce platforms is set to become even fiercer than before, and those that invested in technology and logistics during the pandemic lockdown period would not only retain their customers but also attract new ones. The city's COVID prevention regulations require shippers to carry disinfectant solutions and spray on goods and cash before and after delivery. The city encourages people to use cashless payment methods when buying. Viet Nam to master production technology of 10 human vaccines by 2025 Viet Nam is set to master the production technology of 10 types of vaccines used for humans and be capable of producing at least three by 2025, according to a national sci-tech programme on human vaccine production research by 2030, recently approved by Deputy Prime Minister Vu Duc Dam. With the targets to rise to 15 and at least five, respectively by 2030, the programme’s objectives are to study and master the technology of vaccine production for human use; and to boost the capacity of domestic vaccine research and production organisations and enterprises, making them ready to deal with newly arising epidemics. To realise such goals, the programme set tasks to complete the legal framework and mechanisms, encourage research and international cooperation, the application of advanced technologies, and the establishment of capable research teams, among other works. Human resources development and investment in upgrading related research equipment are also listed among support activities under the programme. Organisations and firms participating in vaccine research and technology transfer will be subject to preferential policies like those applied to prioritised high-tech products. Meanwhile, regarding vaccines for epidemics prevention and control, costs of research, testing, pilot production, assessment, buying insurance, and assisting volunteers are 100 per cent subsidised. Viet Nam already produced 11 of 12 vaccines in the expanded vaccination programme, eliminating many dangerous diseases such as polio and neonatal tetanus. The country has successfully manufactured its first batch of the Sputnik V COVID-19 vaccine from semi-finished products. The vaccine will be used in the country's National Expanded Programme for Immunisation, in response to the fourth wave of COVID-19 infections and amid a limited supply of vaccines. The country has started clinical trials of the ARCT-154 vaccine, the third homemade vaccine against COVID-19. The first COVID-19 vaccine tested on humans is Nanocovax, a product of Nanogen Pharmaceutical Biotechnology JSC based on recombinant DNA/protein technology. The vaccine has gone through three phases of clinical trials with more than 13,620 volunteers. Results from the first two trial phases showed that all volunteers developed antibodies against SARS-CoV-2. The second vaccine, Covivac, from the Institute of Vaccines and Medical Biologicals (IVAC), entered phase three in September 2021. PM orders accelerating public capital disbursement The Government Office has issued the Notice No.262/TB-VPCP dated October 5, 2021 on the Prime Minister’s conclusions at the nationwide teleconference with ministries, centrally-run agencies and localities on stepping up the disbursement of public investment capital this year. Accordingly, the PM hailed four centrally-run agencies and 11 localities for disbursing 60 percent of the assigned capital plan as of late September, and reprimanded 36 ministries, centrally-run agencies and eight localities for completing below 40 percent of the target. As the COVID-19 pandemic is forecast to remain complicated in remaining months of this year, he requested pooling the involvement of the entire political system, strengthening leadership and directions of ministries and agencies, further upholding the role of leaders and the sense of responsibility of each individual, in order to accelerate public investment capital disbursement in tandem with ensuring the quality of works and fighting corruption and wastefulness. Ministers, heads of centrally-run agencies, Chairpersons of People’s Committees of centrally-run cities and provinces must regularly inspect the pace of investment projects in order to timely discover and tackle arising difficulties in each project, especially key ones, considering it one of the important political tasks this year. The Ministry of Planning and Investment is responsible for reviewing and streamlining administrative procedures as much as possible, as well as increasing online working to save time and costs. The Ministry of Finance will publicise monthly results of the work on portals of the Government, ministries, centrally-run agencies and localities. The PM’s special working group on solving tackling difficulties in projects and others on public investment capital disbursement at ministries, centrally-run agencies and localities must keep a close watch of the situation as well as promptly fix arising issues./. Reference exchange rate up 4 VND on October 6 The State Bank of Vietnam set the daily reference exchange rate at 23,158 VND/USD on October 6, up 4 VND from the previous day. With the current trading band of +/- 3 percent, the ceiling rate applicable for commercial banks during the day is 23,852 VND/USD and the floor rate 22,463 VND/USD. The opening-hour rate at commercial banks stayed stable. At 8:25 am, Vietcombank listed the buying rate at 22,630 VND/USD and the selling rate at 22,860 VND/USD, unchanged from October 5. BIDV also kept both rates unchanged at 22,660 VND/USD (buying) and 22,860 VND/USD (selling). Meanwhile, Vietinbank added 1 VND to both rates, the buying rate at 22,636 VND/USD and the selling rate at 22,856 VND/USD./. Programme promotes Russian startup
projects targeting Vietnamese market The programme is jointly organised by the Saint Petersburg Committee for External Relations and State University of Economics, as well as the Russian Federal Agency for Youth Affairs. Under the initiative, selected firms will be trained by experts in a week to grasp knowledge on doing business in Vietnam and complete their projects for the Vietnamese market. The knowledge ranges from intercultural communications, business trends and strategic cooperation directions, to legal basis and investment attraction. According to Nguyen Quoc Hung, head of the support fund for Russia – Vietnam cooperation development, trade and investment ties between Vietnam and Russia are yet to be on par with the nations’ potential and their comprehensive strategic partnership. Therefore, expanding and finding new forms of cooperation to develop such relations are an urgent task. Lauding the programme, he said it will create a premise for startups, helping them better understand business conditions and laws in both countries and broaden their visions in choosing the most suitable business partners and investment areas. CAAV supports Bamboo Airways’
regular direct flights to US The CAAV said Bamboo Airways has been granted a business license for international and domestic air transport and an air operator certificate (AOC) for the B787-9 aircraft in the North American region. Given this, it has sufficient conditions to conduct regular and charter international flights carrying passengers and cargo between Vietnam and the US. According to an air transport agreement signed between the two countries on December 4, 2003, each of the signatories has the right to designate airlines to operate international air transport in line with this deal. Such designations will be announced to the other side via the diplomatic channel, and the types of air transport those airlines will conduct must also be clarified. Therefore, Bamboo Airways is eligible to be assigned as the designated airline of Vietnam to operate regular flights between Vietnam and the US, the CAAV noted. On June 1 this year, the carrier submitted the dossier seeking permission for regular flights to the US Department of Transport. On September 23 and 24, as Vietnam’s designated airline to conduct charter flights between the two countries, it operated a round-trip flight of Hanoi - San Francisco - Hanoi as licensed by aviation authorities of Vietnam and the US. The CAAV said Bamboo Airways have made preparations in conformity with the US’s legal procedures, adding that the continued designation of this carrier to operate regular flights from/to the US after it was designated to conduct charter flights is in accordance with the Vietnam - US air transport agreement, serving as the basis for it to prepare for regular flights to the US in the time ahead. With this designation, Bamboo Airways can organise flights carrying passengers and cargo from Vietnam to the US, and transporting cargo and possibly passengers who are experts, foreign investors, and Vietnamese citizens from the US to Vietnam once getting approval from the Prime Minister, relevant ministries and sectors. The CAAV also proposed the Transport Ministry ask the Ministry of Foreign Affairs to send diplomatic notes to US agencies in charge of foreign affairs to assign Bamboo Airways as the designated airline of Vietnam to operate regular flights between the two countries. National flag carrier Vietnam Airlines was already designated to operate regular flights between the two nations, and it is still preparing its flight plan. Nine-month wood exports to Japanese market hit over US$1billion Despite experiencing a downward trajectory in August and September, the nation’s timber and wood exports to Japan during the opening nine months of the year surged 10% to reach US$1.02 billion against the same period last year, according to the General Department of Vietnam Customs. Timber and wood exports to the Japanese market in August and September dropped by 17.2% and 17% to US$96.2 million and US$90 million, respectively, compared to last year’s corresponding period. This decline can largely be attributed to the impact of the COVID-19 pandemic on the nation as it has made production and export activities encounter numerous difficulties. With regard to the structure of timber and wood products, wooden furniture and wood chips remain the most significant export items to the demanding market. According to statistics compiled by Japan Customs, Japanese wooden furniture imports during the eight-month period reached 540,000 tonnes worth US$1.55 billion, thereby representing a year-on-year rise of 9.7% in volume and 12.7% in value. Most notably, both the nation and China were the two biggest suppliers of wooden furniture to Japan throughout the reviewed period, of which imports from the Chinese and Vietnamese markets accounted for 47.8% and 25.4% of Japan’s total imports of the product, respectively. Moving forward, the country’s COVID-19 containment efforts, its ongoing vaccination drive and advantages of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) in the wood industry is anticipated to boost the exports of timber and wood products to the fastidious market in the remaining month of the year. Vinacomin adds 13.2 trillion VND to State budget in nine months The Vietnam National Coal – Mineral Industries Holding Corporation Limited (Vinacomin) has said its total revenue in the first nine months of this year was estimated at 94.6 trillion VND (4.11 billion USD), 13.2 trillion VND of which has been added to the State budget. During the period, the group produced 2.7 million tonnes of coal and sold 2.85 million tonnes, churned out over 9,300 tonnes of copper ore and 654 million kWh of electricity, thus fulfilling 75-84 percent of the yearly target. Vinacomin General Director Dang Thanh Hai said the group will continue seriously following the Government and localities’ directions in COVID-19 prevention and control. It strives to have all of its staff and workers fully vaccinated by November 12. He also asked member units to step up the production of high-quality coal to meet demand for domestic consumption and export, towards meeting this year’s targets. As planned, the group will produce 3 million tonnes of coal, 130,000 tonnes of aluminum, 9,300 tonnes of copper ore and 938 million kWh of electricity this month./. Shrimp exports to Russia rise 51%
despite COVID-19 impact VASEP statistics show that Vietnam’s shrimp exports have continuously increased sharply over the years, from just US$15.7 million in 2017 to US$41.1 million in 2020, representing an increase of 162%. The 2016 enforcement of a free trade agreement between Vietnam and the Eurasian Economic Union (EAEU) to which Russia is a signatory has created plenty of opportunity for the Vietnamese shrimp to enter the Russian market, says Nguyen Hoai Nam, deputy secretary general of VASEP. Nam notes Russia has a high demand for seafood, including shrimp, but local businesses need to pay attention to product price and quality to promote shrimp exports to this market. Data from the International Trade Center (ITC) also show that in the first seven months of this year alone, Vietnam was the third largest shrimp supplier to Russia, after India and Ecuador. Singapore Stock Exchange greenlights SHB’s $300m international bond issue Saigon Hanoi Commercial Joint Stock Bank (SHB) announced that the Singapore Stock Exchange has approved in principle its first-tranche issue of international bonds of no more than US$300 million, under the Euro Medium Term Note Programme (EMTN). The bonds to be listed are comprised of international senior bonds (non-convertible, unsecured and without warrants) and tier-2 bonds (non-convertible, unsecured, without warrants and open for buy-back after five years and one day). The issue is expected to be made in several phases. In the first tranche issue, the bank will issue senior bonds worth $300 million with a maturity of 3-5 years. The coupon rate will be set later based on the State Bank of Viet Nam’s regulations and market conditions at the time of the issue. The lender hopes the bond issue will enhance its position and brand in the international market, diversify capital mobilisation channels and help ensure the capital adequacy ratio. Proceeds raised through the issue will be used to finance medium- and long-term foreign currency loans. Earlier in April, at the 2021 annual shareholders’ meeting, SHB’s shareholders approved the plan of issuing at most $500 million worth of bonds on the Singapore Exchange under the EMTN programme. Kien Giang calls for investment in 55 projects during 2021-2025 The Mekong Delta province of Kien Giang has approved a list of 55 projects calling for investment in the 2021-2025 period, with total needed capital amounting to over 20.6 trillion VND (around 910 million USD). The projects are in various areas, from industrial park infrastructure, electronics, plastics, wood, agro-fishery processing, for-export leather and footwear, to housing, culture, sports and tourism, waste treatment and water supply. Several projects in trade and the environment are also seeking investors. Among the projects, the biggest one aims to building housing for workers on an area of 60 hectares in Chau Thanh district at an estimated cost of nearly 3.7 trillion VND Another project is inviting investors to build technical infrastructure for the 210.5-ha Xeo Ro industrial park in An Bien district, with costs estimated at 3.61 trillion VND. The province will publicise the list and detailed information on the projects, along with incentives and policies for potential investors. The provincial administration will continue to intensify administrative procedure reform with a view to creating an open and favourable environment for investors./. Deposit interest rate to stay low as banks keep borrowing costs down Commercial banks' deposit interest rate has remained low at the beginning of October, the Vietnam News Agency reported. Deposit interest rate among Vietnam Bank for Agriculture and Rural Development (Agribank), Bank for Investment and Development of Vietnam (BIDV), Vietcombank and VietinBank - the country's largest commercial banks or the big 4 - stayed in the range of 5.5-5.6 per cent for 12-month, 4 per cent for 6-9-month and 3,1-3,4 per cent for 1-3 month term deposits. Other commercial banks have been offering more attractive rates at 5.4-7.1 per cent, notable among them were Techcombank, ACB and MSB at 7.1 per cent annually for 12-13-month deposits at a minimum of VND30 billion (ACB), VND200 billion (MSB) and VND999 billion (Techcombank). Meanwhile, LienVietPostBank, MB Bank, VietABank, HDBank and SCB also offered decent rates from 6.8-6.99 per cent for 12-month deposits with a minimum around ranging from VND200-300 billion. The low interest rate for deposits is part of an effort to lower lending rates for consumers and businesses, which have been struggling during the pandemic. However, even with lower rates, the banks have found it difficult to find borrowers in the last two months as demand plummeted during numerous lockdowns in major cities and provinces across the country, according to Nguyen Tuan Anh, head of the Credit Department of Economic Sectors under the State Bank of Vietnam (SBV). Anh said he expected demand to recover once lockdowns have been relaxed or lifted completely. "The country recorded a 7.18 per cent in credit growth by the end of August since the beginning of the year. It's still possible for us to meet the 12 per cent yearly target by the end of the year but it will take sound and flexible credit policies," he said. Experts said there was still room to lower the borrowing rates but by itself, it won't be enough to help businesses recover. "With plenty of liquidity in the system, we can go lower still on the borrowing rate. While this is especially helpful for many businesses who have been borrowing to speed up their recovery it doesn't help those who have not been able to secure new capital," said Dr Nguyen Tri Hieu, saying a lower rate did not mean the banks were cutting corners when it comes to safety. Commercial banks have slashed more than VND8.8 trillion (US$386 million) in interest rates from July 15 to August 31 in support of businesses that have been severely affected by the novel coronavirus, according to the SBV. Agriculture eyes 2.8 percent growth for 2021 The agricultural sector aims for a growth rate of 2.8 percent and export earnings of 44 billion USD this year, heard a press conference held by the Ministry of Agriculture and Rural Development on October 5. According to Nguyen Van Viet, head of the ministry’s Planning Department, during January – September, the sector’s added value grew at a rate of 2.74 percent and contributed 23.52 percent to the overall growth of the economy. The industry ensured an abundant supply of food, serving domestic consumption and export. The agricultural growth rate was kept at 2.74 percent mostly thanks to the contribution of the cultivation area. Fisheries saw a strong decline in the third quarter, resulting in a slight 0.66 percent growth in the nine-month period. Viet said to achieve the 2.8 percent growth target, the livestock and fishery areas must attain strong growth in the fourth quarter, because there is not much room for growth in cultivation from now to the end of the year. Therefore, the ministry has issued a plan of action that focuses on directing production suitable to weather conditions and COVID-19 development in each locality; promoting market development and facilitating domestic consumption and exports; and intensifying natural disasters alleviation measures. Nguyen Quang Hung, deputy head of the Directorate of Fishery, said the industry will re-organise fishery exploitation and develop a variety of aquaculture species in a bid to achieve this year's production and export targets./. Ho Chi Minh City yet to show signals of business recovery Industrial production firms in Ho Chi Minh City have not yet showed signals of recovery due to the COVID-19 pandemic. According to the municipal Statistics Office, the city’s index of industrial production decreased by 5.6 percent monthly in September. In nine months of this year, the index went down 12.9 percent year-on-year, mostly manufacturing and processing, electricity production and distribution, water supply and waste treatment. Only three sectors recorded expansion, including metal production up 3.5 percent, electrical equipment up 1.7 percent, water exploitation and supply up 0.1 percent. Four key industries posted contraction in nine months, including electronics down 15 percent, food and beverages 14.5 percent, mechanical engineering 8.1 percent, and pharmaceuticals 7.4 percent. Consumption index of manufacturing and processing sector slumped by 14.3 percent while that of metal production, and machinery and equipment up 11.6 percent and 1 percent, respectively. The above figures showed that local enterprises are meeting difficulties in meeting delivery schedules due to supply chain disruption. Apart from stepping up vaccination and gradually resuming production and trade activities, the city is offering support to firms, including preferential loans to small and medium-sized enterprises, reducing lending rates, and waiving individual and corporate income taxes. The Finance Ministry forecast that due to the serious impacts of the pandemic, firms in several sectors still find it hard to recover, especially those working in tourism, aviation and transportation./. PetroVietnam’s State budget payment surpasses 2021 target The Vietnam Oil and Gas Group (PetroVietnam) has surpassed important business and financial targets set for the first nine months of 2021, with its contribution to the State budget fulfiling the yearly plan. Amid the COVID-19 pandemic, PetroVietnam adopted a number of response measures, including forecasting, flexible management, and connecting links in the value chain, which helped the firm maintain production and trade, as well as expand markets. In the past nine months, its oil equivalent output reached 8.2 million tonnes, surpassing the target by 13 percent. Its total revenue also exceeded the plan by 16 percent to 437.8 trillion VND (19 billion USD) while its contribution to the State budget hit 65.9 trillion VND, higher than the yearly target by 5 percent and up 17 percent year-on-year. PetroVietnam also put the Su Tu Trang (White Lion) oil field into operation as scheduled, and ensured the progress of other fields such as BK-18A and BK-19. As the Song Hau 1 and Thai Binh 2 thermal power plants are to be operational soon, the first turbine of the Song Hau 1 plant is expected to be put into commercial operation in early November. As of September 30, PetroVietnam donated 775.8 billion VND to the fight against COVID-19, including 554.9 billion VND to the national COVID-19 vaccine fund. During the nine-month period, the company saved over 2.2 trillion VND, or 80.9 percent of this year’s plan. On September 9, the international credit rating agency Fitch Ratings assessed PetroVietnam’s standalone credit profile at BB . It also affirmed the group’s Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BB' with a Positive Outlook as well as senior unsecured rating at 'BB'. PetroVietnam General Director Le Manh Hung said in order to achieve the 2021 business and financial targets, PetroVietnam will continue flexibly adapting to the pandemic developments, thereby seeking measures to grasp growth recovery opportunities./. Visa, Sacombank cooperate in developing int'l money transfer service Visa, one of the world’s leading electronic payment technology companies, announced that it has partnered with Saigon Thuong Tin Commercial Joint Stock Bank (Sacombank) to deploy the inbound remittance transfer service through Visa Direct. Vietnamese people who are Sacombank Visa debit card holders can use the service to transfer money to any other Visa card issued in 44 countries and territories. It is applicable to the nine most traded foreign currencies in the world. Sacombank is the first bank to implement this form of money transfer in the Vietnamese market based on Visa's secure technical platform and meets the criteria of a fast and convenient service. According to statistics conducted by Visa, there are 5.3 million Vietnamese people living and working in 130 countries and territories around the world. About 190,000 overseas Vietnamese students are studying abroad with the need to receive monthly allowances from their relatives in Vietnam. The number of patients who need to go abroad for medical examination and treatment is also on the rise. Vietnamese people spent 2 billion USD to travel abroad for medical services in 2018. Dang Tuyet Dung, country manager for Visa Vietnam and Laos, said the partnership between Visa and Sacombank to develop Visa Direct service exclusively for Vietnamese consumers was a breakthrough. The overseas Vietnamese community is growing stronger, so the demand for services to support their relatives in Vietnam to transfer money abroad is also increasing. Thanks to Visa Direct, Vietnamese people can provide monthly financial assistance for their children or relatives living abroad more easily and conveniently than ever before. Sacombank Visa debit card holders can transfer money to their relatives and friends living overseas with up to 8,000 USD per transaction and up to 8,000 USD per month or equivalent value if using other foreign currencies. For non-residents or foreigners, Visa Direct service helps them transfer their legal income from salary to their home country or to other countries in the world quickly and easily. Visa Direct aims to provide a reliable platform to transfer money directly to a Visa card or bank account, minimising inconvenient intermediaries and potential risks in money transfers./. Binh Thuan dragon fruit expected to get protected status in Japan Dragon fruit, a speciality of Binh Thuan province, is expected to be awarded the Protected Geographical Indication (PGI) certificate in Japan. PGI status identifies an agricultural product, raw or processed, of which the quality, reputation or other characteristics are linked to its geographical origin. The PGI applies to agricultural, agro-food and wine products. The application for PGI status in Japan for Binh Thuan province’s dragon fruit has undergone two appraisals and recently finished receiving third-party comments on September 21. If the application was approved, Binh Thuan province’s dragon fruit would be the second fruit from Vietnam to receive PGI status in Japan, after Luc Ngan lychee in northern province of Bac Giang. Binh Thuan is among the provinces producing the most dragon fruit in Vietnam with an annual output of nearly 700,000 tonnes. As of December 31, 2020, Vietnam had received 101 PGIs for its farm produce, including six in foreign countries./. Hanoi works to support innovative startups The administration of Hanoi has issued a number of breakthrough mechanisms and policies to support the development of startups. According to the municipal People’s Committee, amid the rapid development of technology, especially the Fourth Industrial Revolution, countries around the world have been investing strongly in innovation application and innovative entrepreneurship to develop manufacturing foundation. The Vietnamese Government views innovative entrepreneurship as one of the national-level goals to provide encouragement and support to turn ideas into innovative startups. Unlike normal startups, innovative startups are capable of growing fast in terms of clientele, revenue, and profit thanks to the capitalisation of intellectual property, technology, and new business models. If they can manage to surmount difficulties and challenges, they can contribute considerably to socio-economic development. Given this, creating an optimal environment for innovative startups is one of the focal tasks of Hanoi authorities at present, the Cong Thuong (Industry & Trade) newspaper reported. The capital city is currently home to about 268,000 businesses, ranking second nationwide. It has witnessed a sharp rise in the number of enterprises over the past years, but innovative firms make up just a modest proportion, about 0.1 percent. Notably, a survey of some business incubators and associations shows that most of startups there are small- and medium-sized enterprises operating on digital platforms. This type of businesses is considered a stepping stone for the formation of innovative startups. Therefore, these companies need assistance in terms of both corporate governance skills and technical infrastructure so as to grow fast, increase the success rate, and contribute more to the economy. Learning of startups’ development demand and difficulties, Hanoi has issued breakthrough solutions to support them, including improving the economic policy, setting up an investment support fund, attracting foreign investors, offering tax incentives, and optimising business procedures. Of note, the city approved a project on supporting innovative startups for the 2019 - 2025 period. This project aims to complete and developing the innovative startup ecosystem in Hanoi; create a favourable environment for facilitating the types of enterprises able to grow fast basing on intellectual property, technology, and new business models; and perfect mechanisms and policies to boost innovative entrepreneurship, thereby contributing to fast and sustainable economic growth of the capital city. Among its detailed objectives, the project will work to connect elements of the startup ecosystem to develop a network of innovative startup support; increase communications to encourage innovative entrepreneurship in each resident, young people, and intellectual; and form a centre for innovation and entrepreneurship in Hanoi to connect domestic and international resources for bolstering startups. In particular, the project will assist the establishment of two - three more business incubators to support innovative entrepreneurship, encourage the formation of three - five private support funds for innovative startups, and attract foreign investment in innovative startups in the capital. Hanoi expects that by 2025, 500 innovative startup projects will have been helped to develop and 150 innovative startups assisted to commercialise their products. Among them, at least 20 percent will succeed in raising capital from venture funds, while mergers and acquisitions worth about 500 billion VND (21.9 million USD) will be conducted. Experts held that Hanoi holds numerous factors to become an innovative startup centre of Vietnam as it boasts high-quality human resources thanks to a large network of leading universities, colleges, vocational schools. However, to become a true innovative startup centre, it still needs to make strong and strategic investment to tap into its strengths, they said, adding that the implementation of the innovative startup support project is an urgent need, matches the current entrepreneurship demand, and also helps turn Hanoi into an innovative startup centre of the whole country./. Hanoi-based businesses speed up production, export Enterprises in Hanoi are accelerating production and export as the COVID-19 pandemic is basically put under control in the capital city. Despite impacts of the pandemic, in the first eight months of 2021, the city saw 13,100 newly-established enterprises with a total registered capital of 165.7 trillion VND (7.26 billion USD). The number of firms resuming operations in the period was 5,687, up 74 percent against the same period last year. To grasp opportunities, Hanoi has directed relevant sectors, districts and townships to map out plans to take advantage of the shifting of production facilities of international enterprises in other countries affected by the pandemic to attract more investment in production and business. Do Anh Tuan, Director of the municipal Department of Planning and Investment, said that right during the social distancing period, the Chairman of the municipal People’s Committee issued a plan on building 46 existing out of 159 industrial clusters by 2025. This shows the thorough preparation of the capital city, he said, adding that established industrial zones and clusters will help draw more investors and restructure the city’s economy based on scientific-technological application and innovation. The capital city is also taking measures to help enterprises address difficulties and stabilise productions. Mai Son, Director of the city’s Taxation Department, stressed that the department is activating policies on extension of tax and land rent payments, as well as administrative procedure reforms. Meanwhile, Deputy Director of the Department of Industry and Trade Dam Tien Thang said that the department has freely provided online COVID-19 declaration solutions to help monitor workers, and get updated information about the pandemic situation. According to experts, socio-economic recovery after a long strict social distancing period is the common aspiration and interests of the business community and people in the city. They stressed the need for special policies in support of enterprises, with focus on measures to ensure a smooth supply chain, as well as on carrying out safe production and business models, providing maximum support for logistics, transportation and goods circulation./. Imports-exports contribute 285.62 trillion VND to State budget State budget collection from import-export activities reached 285.62 trillion VND (12.53 billion USD) in the first nine months of this year, equivalent to 90.6 percent of the estimate and a year-on-year rise of 25.83 percent. According to the General Department of Vietnam Customs, the smuggling of goods across the borders tended to decrease in the reviewed period. However, drugs trafficking still occurred on air routes and on borderlines of Lao Cai and Quang Tri provinces. The custom force detected 3,129 violation cases from June 16 to September 15, seizing goods of 304.36 billion VND and contributing 48.49 billion VND to the State budget. It initiated legal proceedings against 10 cases and suggested relevant agencies launch criminal proceedings against 26 other cases./. Source: VNA/VNS/VOV/VIR/SGT/SGGP/Nhan Dan/Hanoitimes |
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