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Located at the noisy Thai Ha – Tay Son Crossroads, a luxury hotel is deserted with only several security guards at the entrance door. The project has been facing bad luck since its opening. It initially was an office building but offices were in oversupply and the investor had to shift to another business model.

The building was then redesigned to turn it into a hotel. However, it once again met ill fortune when the Covid-19 pandemic broke out. Lockdowns and restricted travel policy have kept it deserted.

Even a gold-plated hotel is facing difficulties. With 360 rooms and many gold-plated items, the construction required investment capital of $100 million. The work was executed within 18 months and completed in March 2020, ready to serve the F1 tournament that was later postponed because of Covid-19. The hotel opening day was also delayed.

Other luxury hotels bearing international brands in Hanoi are in the same situation. Matthew Powell from Savills Hanoi said hotels in Hanoi had a difficult quarter because of the impact of another Covid-19 wave which decreased market capacity.

One 5-star hotel in Dong Da district was officially rated earlier this year, while two 4-star hotels in Ba Dinh and Tay Ho districts saw their star rating expire.

Meanwhile, Capella Hotel in Hoan Kiem was put into operation in Q1, but it has not been rated yet. Two 3-star hotels with 130 rooms had closed by the end of the last quarter.

Regarding supply, the entire market has 10,120 rooms in 17 5-star hotels, 17 4-star and 32 3-star hotels, up by one percent QoQ and 2 percent YoY.

The market capacity was 24 percent, down by 9 percent quarter on quarter and 20 percent year on year Meanwhile, the hotel room rate was $76 per night per room, down by 23 percent year on year.

The Covid-19 resurgence in January in Hanoi led to a reduction in hotel room occupancy rate in February and March to below 20 percent. Five-star hotels led the market in terms of revenue per available room in Q1 with $25/room/night.

Local hotels are now expecting more Vietnamese guests.

According to the Hanoi Tourism Department, after the Covid-19 outbreak was controlled, tourism points in Hanoi reopened in March. About 685,000 travelers came to Hanoi, a 180 percent month-on-month and 360 percent year on year increase.

An OAG (Official Aviation Guide) report showed that the Hanoi-HCM City air route continued to be the second busiest route in the world in March with 980,000 passengers.

Duy Khanh

Shawn Tan, economist from the World Bank’s Finance, Competitiveness and Innovation Global Practice, said the digital economy is becoming more important, especially amid the pandemic. “Digital technologies allow businesses to better adapt to the Covid-19 shock,” he said.

Vietnam’s economic transition from a middle-income to high-income economy requires growth based on labor productivity. Digital technology will be a tool for Vietnam to speed up corporate productivity, improve adaptability and develop new businesses.

Digital technology reduces information and transaction costs and provides goods and services more efficiently, with better quality and a larger customer base and new markets.

“Vietnam has a lot of potential to use the recovery process as an inflection point towards a model of greener, inclusive and competitive growth driven by innovation,” said Shawn Tan.

A report from a World Bank survey in Vietnam shows that, in 2020, about 48% of Vietnamese businesses turned to digital platforms in response to the pandemic. This increased to 59% in October 2020. Meanwhile, only 5% of firms invested in digital solutions and 7% reorganized product combinations.

When surveying the application of technology in Vietnam, the World Bank’s indexes found that “the use of 4.0 technology in Vietnam is still in an early stage”.

Vietnam to quantify digital economy

At the seminar on digital economic measurement.

At the seminar on digital economic measurement held by the General Statistics Office of Vietnam and the World Bank last week, Nguyen Thu Huong, director general of the General Statistics Office, said that measuring and quantifying the digital economy has important implications for Vietnam.

Jaffar Al-Rikabi, World Bank economist, said that measuring the size of the digital economy faces many challenges: digital economy is a new concept with many different definitions; problems related to data quality; difficulty of measuring the consumption of digital products; the value of data investment in a modern economy is difficult to determine; measuring the sharing economy, and the challenges in understanding how the economy works when companies benefit from cross-border operations.

Experience in the world shows that the digital economy can be measured by production or the user (measured by supply – demand). When we want to know the size of the digital economy, we measure production from supply. The supply is often involved in digital economic production and trade, such as the value of investment, employment, research and development. To examine the economic impact of digitalization on the larger economy and society (e.g., productivity and wages), it is necessary to examine the application of digitalization in the digital economy.

After exchanging experiences from a number of countries around the world, officials of the General Statistics Office said that measuring the digital economy is a technical problem and very complicated, especially because identifying and collecting information is still a new thing.

In some developed countries as well as countries that have identified digital transformation as a key industry, they have invested in information gathering to make decisions as well as investment direction for digital infrastructure and digital economy for economic development.

“Vietnam is choosing the digital economy as one of the top priorities. Therefore, we would like to have advice to be able to make decisions, especially to agree on how to understand and identify the current and forward-looking digital economy,” Huong said.

Duy Vu

Lychee being canned for export to the US. Việt Nam’s exports to the US in the first two months of the year accounted for $13.83 billion or 28.4 per cent of total exports. VNA/VNS Photo Vũ Sinh

Compiled by Thiên Lý

Exports for the year as of March 15 were worth US$62.01 billion, a year-on-year increase of 22.7 per cent, according to the General Department of Việt Nam Customs.

Exports to the US in the first two months of the year accounted for $13.83 billion or 28.4 per cent of total exports.

In recent years the US has become Việt Nam’s biggest market. Last year, for instance, at $76.4 billion it accounted for 27 per cent of the latter’s total exports.

Thân Đức Việt, general director of Garment 10 Joint Stock Company, said there were several factors behind Việt Nam’s rapid growth in exports including to the US.

Primarily, he said, the COVID-19 pandemic has gradually been controlled around the world, especially after several countries started vaccinating their populations, enabling many of them to reopen their borders and trade to resume.

Businesses in the country, hit badly for the last year or so by the pandemic, are making strenuous efforts to bounce back, he pointed out.

Many countries around the world have rolled out large stimulus packages to spend their way out of the economic slump, and this has revived trade, he added.

Many analysts concurred with these views, saying the US recently launched a $1.9 trillion package to make direct payments of $1,400 to individuals earning up to $75,000 a year starting in April.

This is the third and largest stimulus since the COVID-19 pandemic broke out.

Việt Nam, one of the US’s major exporters, supplying essential items like fisheries products and garments and electronics, is expected to benefit from this relief package.

Việt of Garment 10 told Đầu Tư Chứng Khoán magazine that Vietnamese exporters hope to get orders from the US.

Americans are known as big spenders, and if they get the money from the Government consumption would surely rise, he said.

His own company’s exports to the US saw relatively high growth in the first quarter and are expected to grow further due to the huge new stimulus package.

Bùi Việt Quang, general director of Red River Garment Joint Stock Company, said his company had enough export orders for until August this year, 80 per cent from the US.

“The US’s $1.9 trillion stimulus package will surely affect enterprises that export to the market. We expect to see robust growth [in US export orders] in the fourth quarter.”

Analysts said a recovery in the US economy would help Vietnamese exporters, especially those in the textile and garment industry.

However, analysts also sounded a warning saying while the US stimulus packages would benefit Việt Nam’s exporters in the short term, loose monetary policies could cause high inflation, which would increase their costs whereas they would not be able to increase prices immediately, affecting their margins.

Besides, the inflation would also hurt demand, they added.

Why property companies want to own banks

Nguyễn Tuấn Anh, director of the State Bank of Việt Nam’s department of credit for economic sectors, said growth in bank lending to the property sector in 2020 was 9.97 per cent, lower than the overall credit growth rate of 12.13 per cent.

This is becoming an emerging trend.

Enterprises in the sector have found it difficult to borrow from banks after the central bank issued a circular in 2019 prescribing limits and prudential ratios for banks.

It reduced the use of short-term deposits for medium- and long-term loans from 40 per cent to 37 per cent from October 2021 and to 30 per cent from October 2022.

This was aimed at controlling credit to high-risk sectors like real estate.

In the event, the only option real estate companies have is to themselves acquire stakes in banks.

They also target owning a piece of securities firms since that would enable them to mobilise capital from the market by issuing stocks and bonds.

Thus, Trần Thị Thu Hằng, the CEO of Sunshine group, became vice chairwoman of the Kiến Long Joint Stock Commercial Bank in 2018 and chairwoman of KS Joint Stock Company (KS Securities) around the same time, indicating that Sunshine or related parties had become major shareholders in the two.

Analysts said the finance and property sectors always have a symbiotic relationship since the latter is highly capital intensive with slow returns.

Thus, Vingroup has tied up with Techcombank, MIKGroup with VPBank, Đất Xanh Group with Viet A Bank, and TNR Holdings Việt Nam with MSB.

While the Government’s efforts to control lending to the property sector have had some effect, banks remain an important source of funding for real estate development projects.

This trend is expected continue in future, analysts said. VNS

On April 18, a team led by Minister of Health Nguyễn Thanh Long travelled to Kiên Giang Province to check COVID-19 prevention and control measures including vaccinations. VNA/VNS Photo. Hồng Đạt

HCM CITY — The Ministry of Health has set up five inspection teams for COVID-19 prevention and control measures, including vaccinations, in the southwest from April 18-30.

The teams will visit Cần Thơ and the provinces of Kiên Giang, Vĩnh Long, Đồng Tháp, Long An, An Giang, Tiền Giang, Bến Tre, Trà Vinh, Hậu Giang, Bạc Liêu, Cà Mau and Sóc Trăng.

On April 18, a team led by Minister of Health Nguyễn Thanh Long travelled to Kiên Giang Province to meet the local Steering Committee for COVID-19 Prevention and Control and checked activity at the international border gate and stations, quarantine areas, and a health centre in Hà Tiên city.

Speaking at the meeting, Hà Văn Phúc, head of the province’s Department of Health, said that COVID-19 prevention and control at the border has been very stressful because neighbouring countries are seeing an increase in cases.

The province is at high risk of community transmission, Phúc said.

The control of migration through trails, border crossings and the sea is difficult, he added.

The province has already found 142 illegal immigrants.

The working conditions for soldiers at border stations are also difficult as they have to ensure strict control of migrants via the border and sea, he said.

All COVID-19 patients who enter the province are brought to Hà Tiên District Health Centre for treatment, he said, adding that the centre is small and can treat only 30 patients.

Phúc said the ministry should allow the province to set up a field hospital. The next day, on April 19, Chợ Rẫy Hospital in HCM City sent a team including 13 medical officials to the province to help set up the field hospital and COVID-19 prevention and control activities.

The province has three COVID-19 testing machines with the maximum capacity of 600 samples per day, but this number does not ensure rapid tracing as the ministry has required, he added.

Phúc said the ministry should give priority to providing two more real-time reverse transcription polymerase chain reaction machines and other items related to COVID-19 tests.

Moreover, the province needs 20,000 rapid tests for COVID-19 diagnosis and 10 million pairs of medical gloves.

Phúc also suggested that the ministry should give priority to providing COVID-19 vaccines in the next phase of the national vaccination drive.

Minister of Health Nguyễn Thanh Long said that the province should prepare for worst-case scenarios if COVID breaks out again.

Prevention and control of illegal migrants via the border and sea should be strengthened, Long said, adding that communication to encourage local people to become collaborators in COVID-19 prevention and control should be enhanced.

He told the HCM City Pasteur Institute and relevant agencies to help the province upgrade its testing capacity. VNS