Unsecured new business loans

The country’s trade turnover during January-February topped some 95.81 billion USD, a year-on-year surge of 25.4 percent.

Vietnam’s trade balance posted positive, 1.29 billion USD, in the first two months of the year, the General Department of Customs said on December 28.

The country’s trade turnover during January-February topped some 95.81 billion USD, a year-on-year surge of 25.4 percent. Of the total, exports amounted to 48.55 billion USD, a yearly hike of 23.2 percent, while imports were estimated at 47.26 billion USD, or 25.9 percent higher than the same time last year.

Foreign-invested companies accounted for 76.4 percent, or 37.07 billion USD, of Vietnam’s total export turnover. Meanwhile, the domestic sector shipped abroad 11.48 billion USD worth of products.

There were nine commodities joining the billion-USD export club, including telephones and parts (9.3 billion USD, up 22.8 percent year-on-year); electronics, computers and parts (6.9 billion USD, up 27.3 percent); equipment, machines and parts (5.5 billion USD, up 72.6 percent); footwear (3.2 billion USD, up 15.4 percent); and wood and wooden products (2.4 billion USD, up 51 percent). They made up 73 percent of the country’s export turnover.

The US was Vietnam’s biggest importer as it splashed out 14.2 billion USD on Vietnamese products, or 38.2 percent higher than the amount it spent the same time last year. China came second with 8.5 billion USD, followed by the EU with 6.3 billion USD, ASEAN 4.2 billion USD, the Republic of Korea 3.4 billion USD, and Japan 3.2 billion USD.

Meanwhile, the country spent big (47.26 billion USD) on imports, with foreign-invested sector purchasing 31.64 billion USD worth of products from abroad for production, up 31.4 percent, while that of the domestic sector surged 16 percent to 15.62 billion USD.

In the two-month period, China was the largest exporter of Vietnam, with revenue estimated at 17.3 billion USD, up 85.7 percent year-on-year, followed by the Republic of Korea with 8.4 billion USD, ASEAN 5.6 billion USD, Japan 3.1 billion USD, EU 2.3 billion USD, and the US 2.1 billion USD.

In a bid to support local firms in promoting production and exports, the Ministry of Industry and Trade said that it will work to capitalise on opportunities from the signed free trade agreements to seek measures for market development. Additionally, it will keep close watch on the global market to identify key export products, while paying due heed to penning measures for market development./.

Switzerland-Vietnam business group debuts

The Vietnamese Embassy in Switzerland has recently held a ceremony to launch the non-profit Switzerland-Vietnam business group (SVBG), which aims at promoting exchanges and investment and trade cooperation between enterprises of the two nations.

Based in Lausanne, the SVBG, the first of its kind founded by Vietnamese expatriates in Switzerland, has been set to focus on offering trade information via workshops, forums, and internal bulletins; providing legal consultations and guidance; developing links for technological transfers and improvement; and introducing quality human resources. It will also make recommendations for more favourable business climate to competent agencies of both nations, while organising socio-cultural activities serving its goals.

Speaking at the debut ceremony, Vietnamese Ambassador Le Linh Lan stressed the group came into being at a special time as Vietnam has placed the COVID-19 pandemic under control and prepared best conditions possible to welcome Swiss investors.

In 2020, Vietnam’s economy grew 2.91 percent, making it one of the few countries that have maintained positive GDP growth while many others in the world fell into severe recession. Also in August last year, the EU-Vietnam Free Trade Agreement took effect, opening up huge trade and investment opportunities for both sides. In last November, as the Chair of the ASEAN, Vietnam successfully pushed the signing of the Regional Comprehensive Economic Partnership (RCEP), establishing the biggest free trade area worldwide.

According to the diplomat, Switzerland is the 6th largest European investor in Vietnam, with its investment totaling 2 billion USD, mostly in manufacturing – processing and electricity. Currently, close to 100 Swiss firms are operating in Vietnam.

Meanwhile, Vietnam is the four biggest trade partner of Switzerland in ASEAN, with bilateral trade exceeding 3.6 billion USD in 2019. Since 2012, Vietnam and the European Free Trade Association (EFTA) – the intergovernmental organisation of Iceland, Liechtenstein, Norway and Switzerland – began negotiations for a FTA, which is expected to be signed this year.

As scheduled, the SVBG will make debut to its Swiss partners at the Webinar Market Focus Vietnam that the group co-hosts with the embassy and the Geneva Chamber of Commerce, Industry and Services./.

Shopping online, a new trend amid COVID-19 pandemic

Online shopping has been increasingly welcomed by Vietnamese consumers since the outbreak of COVID-19. Even though the pandemic has now been largely brought under control, many have continued with this way of shopping due to its convenience.

Many online shopping apps were introduced during the COVID-19 outbreak, creating fierce competition between e-commerce platforms despite the market being relatively new.

Online shopping platforms are forecast to redefine Vietnamese people’s shopping habits even after the pandemic. Experts, however, have recommended that people follow prestigious brands to avoid counterfeit goods./.

Kien Giang keen to become sea-based economic powerhouse by 2025

Boasting 200 km of coastline and 143 islands, the Mekong Delta province of Kien Giang is striving to branch out its maritime sector and become a sea-based economic powerhouse by 2025.

The move aims to contribute to realising the “Strategy for Sustainable Development of Vietnam’s Marine Economy by 2030 with a Vision to 2045”.

According to Standing Deputy Secretary of the provincial Party Committee Mai Van Huynh, the province is prioritising building its maritime sector to boost economic development while protecting the environment and strengthening national defence at sea and on islands.

Major investments have been made in several spearhead industries, such as seafood, tourism-marine services, energy, and maritime industry, among others, helping the province rank second among the 13 Mekong Delta localities in terms of maritime economic development in 2020.

The sea-based economy accounted for 79.75 percent of the local gross regional domestic product (GRDP) during the year, he added.

High-capacity fishing vessels have been built to bolster off-shore fishing, contributing to sustainable fisheries and the protection of the nation’s sovereignty over sea and islands.

With vast fishing grounds and a strong fleet, the province’s annual seafood output tops 500,000 tonnes and its aquaculture yield was estimated at more than 264,100 tonnes in 2020.

Kien Giang is working to secure a total seafood catch and aquaculture output of 800,000 tonnes by 2025.

According to the provincial Department of Agriculture and Rural Development, farming areas in Phu Quoc city, Kien Hai island district, the island commune of Tien Hai in Ha Tien city, and Son Hai and Hon Nghe in Kien Luong district will focus on farming groupers, cobias, yellow-fin pompanos, and seabass, as well as blue lobster, mantis shrimp, crab, and oysters for pearl farming.

Meanwhile, coastal areas in Ha Tien city and the districts of Kien Luong, Hon Dat, An Minh, and An Bien will develop zones for farming molluscs such as blood cockles, saltwater mussels, green mussels, and oysters.

Furthermore, due attention will be paid to high-tech aquaculture, the development of quality staples with high economic value, and measures to prevent illegal fishing.

Local maritime tourism has become a locomotive for growth of the tourism sector, with renowned destinations like Phu Quoc Island. A huge amount of capital has been injected into Phu Quoc city for years, most of which comes from strategic investors like Vingroup, Sun Group, BIM Group, and CEO Group.

According to the provincial Department of Tourism, the province welcomed over 5.2 million visitors in 2020, accounting for 55.8 percent of the plan but down 40.7 percent year-on-year. Revenue from tourism services was put at more than 7.8 trillion VND (339.8 million USD), or 39.3 percent of the target, and down 57.7 percent compared to 2019.

Local tourism is seeing a sound recovery thanks to supportive stimulus measures.

The province will sharpen its focus on tourism infrastructure at key attractions, including Phu Quoc Island, which is to become a world-class marine eco-tourism services hub.

Vice Director of the Department of Tourism Bui Quoc Thai said the province encourages all economic sectors to build and diversify local tourism products, as well as join in efforts to form a major tourism centre.

Regarding energy development, the province prioritises investment in wind power, electrification, solar power, and many other sources of renewable energy.

In the meantime, it has plans to build coastal roads and improve logistics services, while working to preserve ocean biodiversity and restore ocean ecosystems, in particular protecting mangrove forest in tandem with the effective and sustainable exploitation of marine resources./.

Cargo throughput at sea ports posts positive growth in January

More than 62 million tonnes of goods were handled at Vietnam’s sea ports in the first month of 2021, up 17 percent on year despite COVID-19.

Of the total figure, container throughput exceeded 2.2 million TEU, an annual increase of 27 percent.

The Cai Mep – Thi Vai port in Ba Ria – Vung Tau province recorded the highest growth in cargo throughput, at 29 percent, followed by the Hai Phong and Ho Chi Minh City ports, at 26 and 27 percent, respectively.

According to a representative from the Vietnam Logistics Business Association, the volume of goods shipped by sea was affected by not only the pandemic, but also the shortage of ship space and empty containers, and a slowdown in the Vietnamese export market and the global supply chains./.

High-tech farming needs investment and proper policies

Vietnam’s agriculture sector is aiming to be among the 15 most developed countries in the world, in which the agricultural processing sector ranks among the top 10 countries by 2030.

To realise the goal, the Government issued a resolution in 2019 on measures to encourage businesses to invest in effective, safe and sustainable agriculture as part of efforts to help the sector integrate globally.

The Ministry of Agriculture and Rural Development (MARD) recently submitted to the Government a project of export promotion of agro-fishery products by 2030.

The export turnover is expected to reach 50-51 billion USD by 2025 and 60-62 billion USD in 2030.

To implement the target, the MARD will review and propose policies for investment attraction from private and foreign investors into the agro-fishery product processing industry.

For the last five years, there has been a wave of investment into agricultural production with 52,000 businesses, of which the firms directly participating in production hit 13,300, triple the figure of 2015.

The businesses’ participation not only contributed improve the value of agricultural products but also helped farmers access international standards.

In 2020 alone, 18 new factories for agro-product processing opened, a positive signal in improving Vietnam’s agricultural sector.

However, according to experts, although investment in agriculture has flourished in recent years with the participation of many new tycoons, it has not become a strong wave.

Notably, the majority of agricultural enterprises are still small, of which 90 percent are small and super small with capital of less than 10 billion VND (430,000 USD) while the number of enterprises investing in high-tech agriculture is even more modest.

Tran Van Tan, Chairman of Safe and Organic Businesses’ Association of Thanh Hoá Province in central Vietnam, said: “Agricultural businesses had many difficulties in accessing preferential policies leading to difficulties in seeking assistance.”

“Capital was also a big problem. To have the capital to buy agricultural land from farmers was a difficult problem,” said Tan.

“Access to capital from banks was not easy due to many procedures that agricultural enterprises struggled to meet,” he said.

“The accumulation of land to invest in setting up high-tech agricultural zones was also difficult so it required the help from local governments,” he added.

Similarly, Nguyen Thi Diem Hang, Director of the Vietnam Organic Farm Company, said initial expenses for high-tech farming were always higher than traditional farming while high-tech production did not bring immediate economic benefits.

Access to capital and land were also tough problems for agricultural enterprises, Hang said.

“It is necessary to increase the number of businesses taking part in the processing industry to become a kernel for 8.6 million farmers nationwide,” the director said.

“On the other hand, promoting science and technology to produce hi-tech agro-product is an inevitable trend,” she said.

Meanwhile, Ha Van Thang, Chairman of the Vietnam Agriculture Businesses’ Association, said the thing most businesses needed was a legal framework for high-tech farming development.

There was a need for incentive policies such as simplifying loan procedures and completing criteria of high-tech agricultural enterprises to easily access bank loans.

Policies on land accumulation and granting land use right certificates, houses and properties attached with land ownership must be improved, according to Thang.

According to experts, to attract investment in agriculture it was necessary to cut 40-50 per cent of current administrative procedures, improve the business environment and develop businesses substantially.

At the same time, reviews are needed to avoid overlaps in management and inspection and not let one product be subject to the management of too many units. Management methods should change to post-check from pre-check.

Besides, there must be clear planning of material zones connecting with businesses as well as support for the training of human resources for high-tech farming./.

Viet Nam aviation is among fastest growing markets

Southeast Asia will need 4,400 new airplanes valued at US$700 billion to support expanding demand for air travel over the next 20 years, said Darren Hulst, Boeing vice president of Commercial Marketing.

In an online conference yesterday, Hulst quoted Boeing’s 2020 Commercial Market Outlook (CMO), saying: “The intra-Southeast Asian market will become the fifth largest in the world by 2039, and the vast domestic and regional air-travel network across the region positions it well for a post-pandemic recovery.”

With low-cost carriers providing affordable service and added capacity, CMO estimated traffic growth in Southeast Asia to grow by 5.7 per cent annually in the next 20 years, making the region the second largest aviation market in the Asia-Pacific region after China.

Boeing, at the same time, projected the region’s commercial airplane fleet to grow 5.3 per cent annually during the period while the demand for aftermarket commercial services could reach US$790 billion.

Hulst said: “Southeast Asia’s fundamental growth drivers remain robust. With an expanding middle-class and growth in private consumption, the region’s economy has grown by nearly 70 per cent over the last decade, which increases propensity to travel,” adding: “Governments in the region continue to recognise the travel and tourism sectors as important drivers of economic growth.”

Boeing’s vice president said: “Indonesia, Thailand, Viet Nam, Malaysia and the Philippines are the markets that most contribute to the growth in the global aviation market. They are also places with more room for expansion because of the emerging middle class, which could be 60 million new passengers in the next 15 years.”

Hulst also considered Viet Nam as the fastest growing market in terms of growth of air travel in the region with the advantage of a strong domestic market and the recent control of the pandemic.

Mentioning the demand for airplanes in the region, he said though the near-term airplane deliveries were impacted as a result of the pandemic, Boeing estimated operators would need more than 3,500 new single-aisle airplanes in the region by 2039 as the low-cost-carriers have the highest market penetration globally.

The airplane maker said twin-aisle airplanes such as the 777X and 787 Dreamliner still remain foundational to Southeast Asia’s air travel industry, adding one in four twin-aisle airplanes delivered to the broader Asia-Pacific region would go to a carrier operating in Southeast Asia. It forecast the region would need 760 new widebodies by 2039.

As the region’s commercial aviation services growth remained promising in the long term, said the CMO, Southeast Asia commercial services were valued at $790 billion over the next 20 years, a slight increase from last year’s projection, driven largely by growth in freighter conversions and digital solutions and analytics. With such estimation, Southeast Asia expected to require 183,000 more commercial pilots, cabin crew members and aviation technicians.

Globally, Boeing forecast the demand for 43,110 new commercial airplanes and the demand for aftermarket services to be equivalent to US$9 trillion over the next two decades when world air cargo traffic was projected to grow 4 per cent annually due to solid industrial production and world trade. The CMO said freighters would remain the backbone of the cargo industry with the need for 930 new and 1,500 converted freighters during the same span.

High-tech farming needs investment and proper policies

Viet Nam’s agriculture sector is aiming to be among the 15 most developed countries in the world, in which the agricultural processing sector ranks among the top 10 countries by 2030.

To realise the goal, the Government issued a resolution in 2019 on measures to encourage businesses to invest in effective, safe and sustainable agriculture as part of efforts to help the sector integrate globally.

The Ministry of Agriculture and Rural Development (MARD) recently submitted to the Government a project of export promotion of agro-fishery products by 2030.

The export turnover is expected to reach US$50-51 billion by 2025 and $60-62 billion in 2030.

To implement the target, the MARD will review and propose policies for investment attraction from private and foreign investors into the agro-fishery product processing industry.

For the last five years, there has been a wave of investment into agricultural production with 52,000 businesses, of which the firms directly participating in production hit 13,300, triple the figure of 2015.

The businesses’ participation not only contributed improve the value of agricultural products but also helped farmers access international standards.

In 2020 alone, 18 new factories for agro-product processing opened, a positive signal in improving Viet Nam’s agricultural sector.

However, according to experts, although investment in agriculture has flourished in recent years with the participation of many new tycoons, it has not become a strong wave.

Notably, the majority of agricultural enterprises are still small, of which 90 per cent are small and super small with capital of less than VND10 billion (US$430,000) while the number of enterprises investing in high-tech agriculture is even more modest.

Tran Van Tan, chairman of Safe and Organic Businesses’ Association of Thanh Hoa Province in central Viet Nam, said: “Agricultural businesses had many difficulties in accessing preferential policies leading to difficulties in seeking assistance.”

“Capital was also a big problem. To have the capital to buy agricultural land from farmers was a difficult problem,” said Tan.

“Access to capital from banks was not easy due to many procedures that agricultural enterprises struggled to meet,” he said.

“The accumulation of land to invest in setting up high-tech agricultural zones was also difficult so it required the help from local governments,” he added.

Similarly, Nguyen Thi Diem Hang, director of the Viet Nam Organic Farm Company, said initial expenses for high-tech farming were always higher than traditional farming while high-tech production did not bring immediate economic benefits.

Access to capital and land were also tough problems for agricultural enterprises, Hang said.

“It is necessary to increase the number of businesses taking part in the processing industry to become a kernel for 8.6 million farmers nationwide,” the director said.

“On the other hand, promoting science and technology to produce hi-tech agro-product is an inevitable trend,” she said.

Meanwhile, Ha Van Thang, chairman of the Viet Nam Agriculture Businesses’ Association, said the thing most businesses needed was a legal framework for high-tech farming development.

There was a need for incentive policies such as simplifying loan procedures and completing criteria of high-tech agricultural enterprises to easily access bank loans.

Policies on land accumulation and granting land use right certificates, houses and properties attached with land ownership must be improved, according to Thang.

According to experts, to attract investment in agriculture it was necessary to cut 40-50 per cent of current administrative procedures, improve the business environment and develop businesses substantially.

At the same time, reviews are needed to avoid overlaps in management and inspection and not let one product be subject to the management of too many units. Management methods should change to post-check from pre-check.

Besides, there must be clear planning of material zones connecting with businesses as well as support for the training of human resources for high-tech farming.

Thai conglomerate SCG now dominates Viet Nam’s plastic production industry

Under the contract signed on February 9 via a virtual conference, Duy Tan will sell 70 per cent of its shares in five of total twenty-two subsidiary companies, including Duy Tan Plastic Manufacturing Corporation and Duy Tan Long An Corporation, to SCG’s SCG Packaging, Duy Tan said.

Duy Tan Plastic is a leading company in the plastic goods market in Viet Nam with revenue of VND4.7 trillion in 2020. It has nearly 1,000 commodities units and 16,000 distribution agents across the country. The company’s annual capacity reaches 116,000 tonnes of hard plastic packaging and plastic goods.

SCG, Thailand’s largest cement producer, will buy the stakes over three years, starting from 2021. The deal takes a long time as it is based on business results, Duy Tan Plastic said.

Through the deal, SCG and Duy Tan Plastic want to create a solid foundation for a completed supply chain.

Duy Tan Plastic aims at developing hard plastic packaging products, plastic goods and expanding export markets, while the investments help SCG Packaging broaden its hard plastic packaging businesses in ASEAN, especially strengthen capacity to serve FMCG producers and consumers in Viet Nam.

The deal is a part of SCG’s investment plan worth 10 billion baht (US$334 million) to extend its businesses in Viet Nam that has big and growing demands in plastic packaging products.

Wichan Jitpukdee, CEO of SCG Packaging, said that the company will keep investing in Viet Nam, resulting in revenue growth of over 10 per cent each year.

Dominating Viet Nam’s plastic production industry

The plastic production industry in Viet Nam has around 3,300 enterprises with total value of approximately US$18 billion.

The upstream sector of this industry includes petrochemical refineries and chemical enterprises whose main activities are to convert fossil materials into raw plastic beads.

Meanwhile the downstream sector is turning raw plastic beads into plastic products. The downstream can be divided into four main segments, including plastic packaging products, plastic building materials, plastic goods and engineering plastics.

With the deal for Duy Tan Plastic’s shares, SCG is dominating Viet Nam’s plastic industry, especially in plastic packaging products and plastic building materials. These two segments account around 61 per cent of the total market value.

In 2019, SCG Packaging founded Vina Kraft Paper in Binh Duong Province to produce paper packaging products with total capacity of 500,000 tonnes/year.

The company continued to invest in Tin Thanh Packing JSC (BATICO) in 2015. And recently SGC bought 94 per cent of Bien Hoa Packaging JSC’s stakes, with the deal worth of VND2.07 billion (US$89 million).

SCG also owns stakes in many plastic companies including Binh Minh Plastics JSC, Vietnam Construction Materials JSC, Prime Group, Viet Thai Plastchem Joint Venture Company Ltd, TPC Vina Plastic and Chemical Corporation Ltd, Viet Nam Chemtech Company Ltd and Minh Thai Plastic Material Company Ltd.

In 2018 June, SCG signed a contract to buy 29 per cent of Viet Nam Oil and Gas Group (PetroVietnam)’s shares in Long Son Petrochemical Complex Project, raising its equity from 71 per cent to 100 per cent with total investment value of 8.5 billion baht per year.

HCM City to ensure transparent, fair and competitive environment for property market

The chairman of the HCM City People Committee has pledged to review all housing projects in the city and work out solutions to create a “more transparent, fair and competitive business environment”.

Speaking at an annual meeting with the HCM City Real Estate Association (HoREA) last weekend (Feb 27), Nguyen Thanh Phong said the city would work with agencies to address delays in “the issuance of investment policy approval for developers and ownership certificates for homebuyers”.

Le Hoang Chau, chairman of HoREA, said over the past years, the association has submitted numerous petitions and proposals to the Government and local authorities to resolve problems related to investment and construction.

Businesses have frquently petitioned the People’s Committee to speed up procedures for investment approval for commercial housing projects, he added.

In 2020 alone, 61 commercial housing projects were delayed because the land they were allotted was a mix of plots with various purposes and uses, he said.

“A number of projects being built on public lands were halted and are being reviewed for compliance,” Chau added.

According to a report from the Department of Construction, procedures for investment approval of commercial housing projects take up to 247 working days, or 50 weeks, excluding 14 public holidays, which is too long.

The association has also urged city authorities to speed up the issuance of home ownership certificates for more than 30,402 housing units in 163 projects in the city.

“The Department of Natural Resources and Environment needs to work with the Department of Finance, the City Land Price Appraisal Council and other agencies to determine land-use fees for the housing projects to speed up the process,” he noted.

“Priority should be given to home-ownership certificates for homebuyers who have fulfilled their obligations under the housing purchase contract,” he added.

A number of apartment buildings have been built in violation of approved plans and designs in the city, delaying the issuance of land-use and home ownership certificates, according to the Department of Construction.

Many developers have even mortgaged their buildings to get loans for other projects, meaning buyers have been unable to get ownership certificates, it said.

New guidelines

Recently, city authorities issued guidelines to speed up the issuance of land-use and home ownership certificates to buyers to prevent disputes with housing developers.

They divided apartment projects into two categories related to collection of land-use fees and issuance of ownership certificates.

For apartments within a compound, the entire project area is identified as “residential land” and is subject to fees for issuance of certificates for land-use rights, house ownership and other land-related assets.

For those without compounds that come with public areas such as parks, schools, hospitals, and main roads connecting to public roads outside the apartment building, only the area of ​​land used for apartment construction is considered “residential land”.

For the public areas, the city will organise bids to select investors.

The construction of technical works such as electricity and water supply, drainage, lighting, and telecommunications systems must be done by the developer and handed over to the city. No land-use fees will be collected.

The Department of Natural Resources and Environment has been assigned to work with the departments of planning and architecture, construction, and other agencies to classify land areas in each project (both already completed and upcoming) subject to fees for issuance of ownership certificates.

The Department of Construction will be responsible for monitoring compliance with construction norms and penalising violators.

The city has ordered agencies to carefully review investors’ financial capacity before licensing projects. Investors found to have committed violations must be severely sanctioned.

There are 15,000 real estate firms operating in the city.

Experts attributed the challenges facing businesses to inconsistent regulations on housing and land investment. Hundreds of housing projects are under inspection for legal procedures, delaying their progress.

Modern trade channels, e-commerce to be further thrive: experts

Modern and online shopping channels recorded strong growth last year and will continue to thrive this year, according to experts.

Nielsen Vietnam’s retail chain consulting said the COVID-19 pandemic has boosted online shopping and more consumers would choose to shop online even after the pandemic ends.

As of December there were around 8,500 stores nation-wide, including 453 supermarkets and 5,566 minimarts with the rest being convenience, health and beauty, drug, and cash & carry stores.

There is a fierce competition in the retail market, and so each chain has to identify its strengths to retain competitiveness.

According to the Ministry of Industry and Trade, average retail sales and consumer services revenue per capita increased from 19.3 million VND in 2010 to 51.2 million VND in 2019, accounting for 8 percent of GDP.

E-commerce, supported by electronic payment, has grown especially strongly in recent years, averaging over 27 percent growth, it said./.

Cargo throughput at sea ports posts positive growth in January

More than 62 million tonnes of goods were handled at Vietnam’s sea ports in the first month of 2021, up 17 percent on year despite COVID-19.

Of the total figure, container throughput exceeded 2.2 million TEU, an annual increase of 27 percent.

The Cai Mep – Thi Vai port in Ba Ria – Vung Tau province recorded the highest growth in cargo throughput, at 29 percent, followed by the Hai Phong and Ho Chi Minh City ports, at 26 and 27 percent, respectively.

According to a representative from the Vietnam Logistics Business Association, the volume of goods shipped by sea was affected by not only the pandemic, but also the shortage of ship space and empty containers, and a slowdown in the Vietnamese export market and the global supply chains./.

HCM City’s CPI inches up 1.19 percent in February

The consumer price index (CPI) in the southern largest economic hub of Ho Chi Minh City increased 1.19 percent in February from the previous month, according to the city’s Statistics Office.

Among 11 groups of products and services in the CPI basket, the group of housing, electricity, water and construction materials had the highest price increase of 2.06 percent. This included a 13 percent hike in power price, 2.65 percent rise in water price, and 0.14 percent fall in housing rent due to the COVID-19 pandemic.

The prices of restaurant and catering services showed a big jump of 1.35 percent, with those of foodstuff growing 1.79 percent from January. The strongest surges in this group were seen in the prices of pork (5.28 percent), beef (2.36 percent), poultry (3.99 percent) and aquatic products (3.12 percent) due to high demand during the traditional Lunar New Year (Tet) holiday – the biggest traditional festival of Vietnamese people.

Moving in the same trend were groups of beverage and tobacco (0.41 percent), and garment, hats and footwear (0.35 percent).

Affected by the petrol price hikes on January 26 and February 25, transportation fees increased by 1.68 percent.

In contrast, the prices of medicine and medical services dropped by 0.05 percent, and those of the education group decreased by 0.01 percent.

The Statistics Office also said that the gold price went up by 1.1 percent while the price of US dollar expanded 0.02 percent as compared to January./.

Over 18,000 new firms set up in first two months

More than 18,000 new businesses were established in the first two months of 2021, a year-on-year decline of 4 percent, according to the Ministry of Planning and Investment.

The number of employees registered by the newly-established enterprises rose 9.7 percent to 173,000.

The months saw an addition of over 720.4 trillion VND (32.24 billion USD), in total registered capital, up 12.4 percent. Average level in registered capital per enterprise surged 46.4 percent to reach 18.5 billion VND in the period.

About 11,030 enterprises resumed operations in the first two months, down 7.6 percent while 33,611 others were dissolved, an increase of 18.6 percent.

In February alone, as many as 8,038 new businesses were set up with a combined registered capital of nearly 179.74 trillion VND.

The number of new firms represented a year-on-year drop of 12.3 percent while the amount of capital surged 85.6 percent.

The number of workers registered by these businesses reached almost 57,000, down 22.1 percent./.

Udmurtia keen on boosting bilateral trade with Vietnam

First Deputy Prime Minister of the Udmurt Republic of the Russian Federation Konstantin Suntsov has expressed his belief that its bilateral relations and trade with Vietnam will be enhanced in the coming time.

Talking with a Moscow-based Vietnam News Agency reporter, Suntsov said that two-way trade hit 165 million USD in 2019, which was estimated at 200 million USD last year despite impacts from the COVID-19 pandemic.

He noted that Udmurtia is running a trade surplus with Vietnam, with its exports accounting for up to 70 percent of the total value, mostly metal and forestry products, cellulose and papers. Meanwhile, Vietnam has mainly shipped consumer goods to Udmurtia.

While expressing his interest in Vietnamese coffee, Suntsov said Udmurtia’s Tasty Coffee company accounts for about one-third of Russia’s coffee market share.

According to the official, Udmurtia already exported military technical products, metal and wooden products and medical equipment to Vietnam, and plans to ship more farm produce, light chemical industry products and IT services.

At an online trade promotion forum held in late 2020, Udmurtia introduced unmanned aerial vehicles, medical equipment, food colouring products, bleaches used in agriculture and farm produce to Vietnamese partners.

Mentioning important points in the Russia-Vietnam comprehensive strategic partnership, he said the two nations already signed a free trade agreement, thereby raising two-way trade to 6 billion USD in 2018.

He also praised Vietnam for its natural, art and cultural beauty which he felt during his visits to Hanoi, Sa Pa and Ha Long Bay in 2015.

On its capacity as rotating ASEAN Chair in 2020, Vietnam well performed its role in assisting other regional member states in coping with the COVID-19 pandemic, Suntsov said.

In his opinion, the Regional Comprehensive Economic Partnership (RCEP) agreement, signed in 2020, will become a bridge between Russia and Southeast Asia.

As Vietnam is really a bridge between Russia and ASEAN, Udmurtia will also take advantage of that, he said.

Udmurtia is a federal subject of the Russian Federation within the Volga Federal District. Industry now accounts for over 45 percent of Udmurtia’s economic structure. Its enterprises also manufacture equipment for nuclear power plants, medical and oil-gas equipment, metal and plastic products. Agriculture is also an important priority of its development./.

Vietnamese and Japanese firms receive support to expand operations

The Japan Trade Promotion Organisation (JETRO) will host an online scheme on March 3 in Hanoi aimed at connecting Japanese businesses in the field of manufacturing and production, known as Monozukuri in Japanese to facilitate co-operation amid the negative impacts caused the COVID-19 pandemic.

According to a representative from the JETRO, the business matching programme will see the participation of 40 Japanese companies for the purpose of accelerating the development of the country’s supporting industry.

At present, the scheme has received registration for 50 negotiations from enterprises from Japan, Vietnam, and Taiwan (China), whilst it is still receiving registration from businesses wishing to purchase and seek Japanese suppliers in the Monozukuri field until March 1.

A recent survey conducted by the JETRO unveiled that Japanese businesses remain keen on the Vietnamese market as the country is viewed as an alternative investment destinations for Japanese enterprises looking to move away from China due to the COVID-19 pandemic.

The survey indicates that approximately half of Japanese enterprises in the nation plan to expand their production activities, while roughly 70% of them seek opportunities to increase revenue in the local market.

Most notably, 46.8% of Japanese enterprises unveiled that they have initiated plans to expand their business in the nation over the course of the next two years, with the expansion rate ranking fourth, the highest in the Asia-Pacific region.

Japanese enterprises have therefore attributed their expansion to an increase in revenue in the domestic market and high growth potential.

Furthermore, Japanese firms are also considering re-establishing some supply chains which have been impacted by the COVID-19 pandemic, with Vietnam able to capture the attention of suppliers and buyers of materials globally.

Air service on HCMC-Van Don route set to resume

Vietnam Airlines will resume flight operations on the HCMC-Van Don route starting from March 3, as the Covid-19 outbreak in Quang Ninh Province, where the Van Don International Airport is located, has been brought under control.

This is the first local carrier to announce its plan to resume flights to Van Don since the outbreak hit Quang Ninh, reported Nguoi Lao Dong Online.

The national flag carrier will operate one weekly flight on the route on Wednesdays between March 3 and 17 and plans to increase it to three flights per week on Wednesdays, Fridays and Sundays from March 18 to December 31 this year.

The flights will depart from HCMC at 1 p.m. and from Van Don at 3:45 p.m.

The carrier is offering special ticket prices starting from VND33,000 per leg (equivalent to VND507,000 per leg including taxes and fees) for the first three flights on the route between March 3 and 17.

From the fourth flight onward, which will be operated from March 18 to the end of the year, the airfare will start from VND109,000 (or VND590,000 including taxes and fees) for trips taken from March 18 to June 30.

Earlier, the Ministry of Transport decided to shut down the Van Don airport in 15 days from January 29 to February 13 to combat Covid-19, as an airport security staff member tested positive for the coronavirus.

The ministry later extended the airport’s closure to February 21 and then to March 3.

During the recent Lunar New Year holiday, the Vietnam Airlines Group operated 6,050 flights carrying nearly 800,000 passengers, while all of the local airlines operated a total number of 14,400 flights with over 1.7 million passengers.

Construction of US$115 million high-tech dairy farm starts in An Giang

Construction of a large-scale project of high-tech dairy cow farming and milk processing has been kicked off in the Mekong Delta province of An Giang.

Speaking at the kick-start ceremony, Permanent Deputy Prime Minister, Truong Hoa Binh highly appreciated the provincial government that has created advantages for the implementation of the project, towards the sustainable development associated with benefits of business and the community.

He hoped the project will become a typical dairy farm in the region and asked ministries and State units to support An Giang and the investor, TH Group to complete the project on time.

The project costing VND2,655 billion (US$115 million) will have a herd of around 10,000 cows that are expected to produce 135 tons of milk per day.

Besides, the investor plans to build an eco-accommodation site and focus on organic farming and growing to provide agricultural products meeting Global GAP (Good Agricultural Practices) standards.

Gas price increases for the third time in 2021

A statement of the Ho Chi Minh City One-Member Limited Liability Oil & Gas Company (Saigon Petro) said that gas price has edged up VND417 per kilogram, equaling to VND5,000 a 12-kilogram cylinder as from March 1.

With the price spike, a 12-kilogram cylinder costs VND400,500 (US$17.31). The gas prics of Pacific Petro, City Petro, ESGas also surge VND5,000 a 12-kilogram cylinder.

According local gas companies, on March 1, the world gas price is estimated at US$610 per ton, an increase of US$15 per ton in comparison with February. As this reason, they adjusted the domestic gas price.

This has been the third hike of domestic gas price in 2021.

Indonesian Consulate General works to promote investment in Dong Nai

The Indonesian Consulate General in Ho Chi Minh City said it will work as a bridge helping Indonesian firms to invest in the southern province of Dong Nai.

Hanif Salim, Indonesian Consul General, on March 1 visited Dong Nai to explore investment projects in the locality.

Speaking at a working session with local leaders, Hanif Salim said Indonesia’s investment in the province remains limited and is yet to match potential of both sides.

Located in the southern key economic region, Dong Nai has posted high, stable economic growth over the past year.

The province has established 32 industrial parks, of which 31 are operational, attracting 1,533 FDI projects from 45 countries and territories, with total registered capital amounting to 31.8 billion USD.

Indonesia contributes two projects worth 12 million USD./.

Source: VNA/VNS/VOV/VIR/SGT/Nhan Dan/Hanoitimes

The Ministry of Finance has submitted a proposal to the Government seeking approval to create a decree expanding the timeframe for tax and land lease payments.

The move is expected to ease difficulties faced by enterprises amid the COVID-19 pandemic, especially those in tourism and transportation.

Under the proposal, payments of value added tax are to be extended by five months, during which revenue to the State budget will fall by nearly 68.8 trillion VND (2.99 billion USD).

Regarding corporate income tax, around 40.5 trillion VND in payments during the first and second quarters will be delayed by three months.

Meanwhile, the payment of some 1.3 trillion VND in value added tax and personal income tax from business households and individuals will also enjoy a delay.

The ministry suggested extending the deadline for land lease payments in the first installment, valued at about 4.4 trillion VND.

The total value of delayed taxes and land lease will amount to 115 trillion VND.

Tax agencies allowed delays in tax and land lease payments worth some 87.3 trillion VND last year, for 184,900 taxpayers./.

Vietnam to overcome difficulties in 2021 through solidarity: MoIT leader

Challenges remain ahead in 2021, but Vietnam will overcome all with solidarity between the political system, businesses, and the people, Politburo member, head of the Party Central Committee’s Economic Commission, and Minister of Industry and Trade (MoIT) Tran Tuan Anh has said.

In an interview with the Vietnam News Agency, Anh said that this year, amid the complex developments of the COVID-19 pandemic, the major target defined by the Party, State, and Government continues to be effectively containing the pandemic to protect people’s lives and public health.

The country will coordinate with the international community to fight COVID-19 while continuing to recover its economy and return to true normal, ensuring people’s living conditions and building a foundation for the country’s sustainable development over the next five and 10 years, he said.

All economic recovery and normalisation activities will be conducted on the basis of ensuring the prevention of COVID-19, he added.

He underlined that the new integration frameworks Vietnam is engaging in, especially free trade agreements (FTA) and new-generation FTAs, bring unprecedented opportunities for the country in all fields, helping to fuel economic growth.

Anh stressed the need for the Ministry of Industry and Trade to further speed up the restructuring of economic sectors towards reforming the growth model, and improving added value.

At a ceremony to ship the first coffee batch to Europe (Photo: VNA)

He highlighted the necessity for Vietnam to further expand markets, especially within the FTAs, while engaging more deeply in supply chains to promote supporting industries as well as the manufacturing and processing sector and agriculture. This is a vital factor for the successful international integration by agriculture and farmers under the country’s general strategy.

In particular, it is crucial to immediately implement Politburo Resolution No 55 on sustainable energy development and Resolution No 23 on national industrial policies, he said, describing those documents as the cornerstones for the building and development of essential infrastructure of vital significance for the economy, serving sustainable development in the future.

He noted that Vietnam signed three FTAs in 2020: with the EU and the UK as well as the Regional Comprehensive Economic Partnership (RCEP).

Thanks to its integration process, Vietnam has made fundamental changes in its macro-economy, thus securing economic and socio-political stability and paving the way for continuous sustainable development in the years ahead, he said./.

Investment booms as Soc Trang improves business climate

Soc Trang province’s efforts to improve its business climate is paying off with more and more investors, both domestic and foreign, coming since 2016.

The Mekong Delta province has worked with hundreds of potential investors seeking to invest in areas where the province has strengths like hi-tech agriculture, tourism and wind and solar power.

It approved 116 projects with a total investment of 27.3 trillion VND (1.18 billion USD) in 2016-20, 5.5 times the amount in the previous five years.

Nine of them are FDI projects.

Soc Trang authorities have been making efforts to improve the investment climate and provincial competitiveness by focusing on infrastructure and providing lands for projects.

They are keen on projects that are sustainable and environment-friendly.

Nguyen Thi Thuy Nhi, deputy director of the province’s Department of Natural Resources and the Environment, said her department had been reforming administrative procedures, boosting the province’s competitiveness in terms of attracting investment and business climate.

One key infrastructure project is the upgrade of Tran De deep-water port, which will reduce logistics costs for exports from the Mekong Delta.

The recently approved Chau Doc – Can Tho – Soc Trang highway will connect to the port, aiding goods transportation and improving links with the rest of the country.

The province is also creating a start-up eco-system with development assistance, incubation programmes and sponsorship for creative small and medium-sized businesses.

In the last five years 1,900 new businesses were set up, a 47.2 percent increase from 2011 – 15. Many companies have invested in manufacturing in the An Nghiep Industrial Park, creating tens of thousands of jobs.

In 2021 – 25 Soc Trang seeks to further improve its business climate and competitiveness, focusing on business assistance services, labour training and helping investors start projects smoothly.

There are 3,300 registered businesses in the province with a total charter capital of 33 trillion VND.

Soc Trang’s economy grew by 6.75 percent in 2020./.

Ministry takes action on market stability in new circumstances

The Ministry of Industry and Trade has called for concerted solutions to maintain market stability, remove difficulties facing domestic firms, and increase the total retail sales of goods and services.

Such solutions rolled out in line with the Government’s Resolution No 01/NQ-CP dated January 1, 2021, are expected to contribute to the country’s socio-economic stability.

The ministry will continue to improve the socialist-oriented market economy mechanism to facilitate economic recovery, and spur growth in the industry and trade sector in a rapid and sustainable manner.

It has also focused on improving the sector’s adaptability and resilience against external shocks to stabilise production and consolidate the domestic and foreign market so as to flexibly and effectively realise the dual goals of containing COVID-19 and recovering and developing the sector in the “new normal”.

Notably, the sector has stepped up restructuring in tandem with growth model reform, and paid more attention to the processing and manufacturing industry in combination with smart technologies and digital transformation to raise productivity, quality, efficiency, and competitiveness.

More attention will be paid to developing the domestic market, promoting the consumption of Vietnamese goods, enhancing trade promotions, and boosting e-commerce.

Given the impact of COVID-19, the ministry has asked businesses to increase the supply of goods, especially necessities, and requested local Departments of Industry and Trade to take measures to ensure market stability.

To remove difficulties in the consumption of agricultural products, the ministry has adopted solutions to boost consumption links domestically and negotiated with major buyers to facilitate exports./.

HCM City: Work begins to supply power for Metro Line No 1

The Management Authority for Urban Railways of Ho Chi Minh City (MAUR) and contractors kicked off work on power supply for the southern economic hub’s first metro line project on February 19, which has now seen 82 percent of works completed.

Consultation and construction are now underway to link power sources from the 110kV Binh Thai and Tan Cang electricity stations to supply all power stations along the metro line.

According to the MAUR, if COVID-19 can be controlled, the work of cable pulling will be completed in the second quarter of this year, which would allow for trial runs and commercial operations taking place earlier.

MAUR deputy head Huynh Hong Thanh vowed to work with contractors on speeding up construction progress, with quality put first and pandemic control and prevention measures implemented effectively.

The 2.05 billion USD metro line, which runs between Ben Thanh Market in District 1 and Suoi Tien Theme Park in District 9, is the first of at least six to be built in the city and aims to ease traffic congestion in its north-eastern gateway.

It is designed to have 14 stations, three of them underground. There will be 17 three-carriage trains plying the route, running at a maximum speed of 110 km/h above ground and 80 km/h below ground./.

Fight with e-commerce fraud to be increasingly fierce

The General Department for Market Surveillance has shown determination in the war against counterfeit goods and trade fraud products in e-commerce channels.

Last year saw e-commerce flourish and it is forecast that this will continue in the coming years. Therefore, the fight will be increasingly fierce this year, especially as “the border gate is at the door of each citizen”, according to one official.

Tran Huu Linh, director-general of the General Department for Market Surveillance, said that in the past, large warehouses were often located in big cities such as Ha Noi and HCM City, but now, the largest warehouse is located in the northern mountainous province, just a few kilometres from the border.

Along with that, modern logistics, delivery and payment services help bring the “border gate” to the front of houses, he added.

By just packing the goods and delivering them to shipping companies, the goods could be taken anywhere domestically without any difficulty, said Linh.

This created more challenges for authorities as transactions through e-commerce become more and more popular with all people, he noted.

“We have determined that there must be a more professional and methodical plan in this fight. In the immediate future, it is necessary to propose units in the Ministry of Industry and Trade to soon submit to the Government a decree replacing Decree 52/2013 on e-commerce,” Linh told online newspaper phapluatplus.vn.

One reason the decree is needed is the speed of e-commerce development, meaning it’s time to consider and treat goods in the e-commerce environment as in the traditional environment, he noted.

Linh said that the decree was issued to promote the development of e-commerce, so it has not strictly regulated goods traded via e-commerce.

Besides, the decree has not specified the responsibilities of e-commerce trading floor managers. This loophole has caused the floors not to strictly control the origin of the goods displayed for sale.

Therefore, it was necessary to hold e-commerce floor owners responsible so that when having trade fraud problems, they are also subject to inspection and post-inspection sanctions. Important services including payment and transportation would also be included in the new decree, he said.

In addition, the General Department for Market Surveillance will focus on e-commerce for two to three years because as it was forecasted that the ratio of trade fraud in e-commerce would be about 50-60 per cent in that period compared to overall types of fraud in general, said Linh.

That is why the General Department for Market Surveillance has built a relatively comprehensive plan to mobilise strength for this tough war.

It is proposed to set up an official division of the market surveillance force specialised in preventing fraud in e-commerce, at the same time, improving the post-inspection capacity of the market surveillance force and regularly reviewing and inspecting e-commerce trading floor owners and social networking platforms.

Public investment disbursement must be sped up: minister

Speeding up the disbursement of public investment from the start of this year was an important solution to accelerate economic recovery amid the COVID-19 pandemic, Minister of Finance Dinh Tien Dung has said.

The global economy was expected to embark on the recovery process after a deep downturn in 2020 due to the pandemic. However, the recovery would be different from country to country, depending on the developments of the pandemic and efforts to contain the virus.

“It is necessary to drastically implement measures to accelerate the disbursement of public investment in 2021, right from the first months of the year to create the impetus for economic growth to meet and even exceed targets,” Dung said.

Accountability must be enhanced, he stressed.

To make public investment a pillar for economic growth, the finance ministry is developing a programme with a focus on removing legal bottlenecks to disbursement of public investment.

Inspections would also be enhanced to ensure the allocation and use of public investment to follow National Assembly and Government plans while close watch would be kept on the process to tackle problems.

Regarding the disbursement of public investment from foreign loans, Dung said the progress remained stagnant, partly due to the pandemic.

There were also subjective reasons for the stagnation, including slow site clearance, a lack of accountability and poor preparation which required adjustments and slowed disbursement, he said.

Dung said that to fulfil the public investment plan for 2021-25, it was important to enhance the accountability of all parties relevant to the use of public investment in all stages, from preparation to implementation and settlement.

Projects which failed to meet planned progress should have their capital revoked, he stressed.

Statistics of the Ministry of Planning and Investment showed the disbursement of public investment was estimated at VND398 trillion (US$17.3 billion) as of the end of December, meeting 82.8 per cent of the Government’s plan – the highest rate in the 2016-20, thanks to the Government’s determination to speed up the disbursement of public investment as a major driver for economic growth.

According to the General Statistics Office, every increase by 1 per cent in public investment disbursement would push GDP by 0.06 percentage points.

The Vietnamese economy expanded at 2.91 per cent in 2020, the lowest rate in the past decade but this was considered a big success in the context of the COVID-19 pandemic.

More than 14,000 tonnes of dragon fruit exported to China via Lao Cai border gates

More than 14,000 tonnes of dragon fruit were exported to China from February 10-17 through border gates in the northern province of Lao Cai, according to the provincial Border Gate Customs Sub-Department.

Lao Cai authorities, including customs, border guards, and medical quarantine officials, maintained operations in the opening days of the Lunar New Year to ensure the quick and safe customs clearance of goods.

During the period, total import-export revenue through border gates in Lao Cai topped US$11 million, including $2.4 million worth of imports, mainly fertilisers and farm produce, and $8.8 million worth of exports, mostly agricultural products.

According to the Border Gate Customs Sub-Department under the Lao Cai Department of Customs, in 2020, despite the impact of COVID-19, the sub-department completed its ‘twin targets’ by processing customs clearance declarations for 516 businesses with an import-export value of more than $1 billion and ensuring safety from the pandemic.

In 2021, it will work with other sectors to speed up administrative reform while exhibiting better performance in e-customs clearance activities to save time and costs, ensuring economic development and COVID-19 prevention and control at the same time, the department said.

Bac Ninh eyes $123 million IP

Prime Minister Nguyen Xuan Phuc has approved investment intention in a project on infrastructure development at the Thuan Thanh I Industrial Park in northern Bac Ninh Province.

The project covers a total area of some 250ha in Ninh Xa, Tram Lo and Nghia Dao communes of Thuan Thanh District, with total investment of VND2.84 trillion (over US$123 million), of which VND859.73 billion comes from its investor – Viglacera Corporation.

The construction is scheduled to last for 36 months from the land hand-over, and the project is set to operate for 50 years from February 17, 2021.

The PM required the provincial People’s Committee to ensure the accuracy of information and data reported, and carry out land reclamation, site clearance, compensation and land lease in line with approved documents.

The construction must comply with the detailed planning scheme that has been approved, he said, stressing that the committee needs to instruct the management board of industrial parks in Bac Ninh and relevant agencies to supervise and assess the implementation of the project.

The PM also highlighted the building of houses, and social, cultural and sport facilities for labourers in the industrial park, as well as employment and vocational training support to local residents who have to relocate to make way for the project.

Hybrid model, the new rising trend in office market

A hybrid working model comprising both remote and office-based work is a trend that many companies will embrace since working methods have changed globally after the pandemic broke out, including in Viet Nam, experts have predicted.

In a note on trends in the property market this year, property consultancy Jones Lang LaSalle (JLL) said a year of lockdowns that forced people to work from home showed many tasks could be done remotely, spurring companies to adopt new, hybrid working models.

The shift was already underway at many businesses, but was accelerated by COVID-19 like many other things, it said.

“In 2020 a work from home experiment took place globally and showed that businesses can continue to operate effectively by leveraging technology” Paul Fisher, country head of JLL Vietnam, said.

“But for many, the lack of face-to-face interaction has put pressure on teams and whilst a number of our clients expect to adopt flexible working practices in the future, for the majority this will include the office remaining the central point for business activities.”

But many aspects of work would not change, the note said. People would still need to collaborate, innovate and liaise with managers on projects and their careers, a reason why people missed the office, and it was why for many offices would retain a central role in corporate life.

The office still existed as the best and most convenient place for team building and connecting with management.

WeWork predicted at an ongoing roundtable on office trends in the region that beyond economic pressures and realities that enterprises face, tapping new workspace strategies is crucial for future-proofing themselves in a volatile climate.

Amidst the changing face of its enterprises, Southeast Asia is seeing a shift towards flexible workspaces bridging enterprises’ challenges and opportunities, it said.

Talking about the future of the workplace after the pandemic, Elizabeth Fuller, the company’s head of growth, SEA, said after a year of pandemic working from home might be an alternative option for many companies.

But this is not sustainable for businesses in the long term, she claimed.

In the workplace, innovation, creativity and organisational health hinges on successful collaboration, and a loss of these would hinder sustained business performance, employee engagement and organisational health in the long run, she said.

The new work order would thus be a hybrid of flexible workplace arrangements, she said.

She cited the example of two Fortune 500 companies that have expanded their presence with WeWork across several buildings by establishing a headquarter presence in one location and supporting functions and business units in the others.

“They have leveraged our CBD presence, with locations in close proximity to each other. This allows them to scale accordingly without having to renegotiate existing real estate commitment, implement distributed workforce as a safety measure and also enjoy engagement.”

Property consultancy CBRE said the pandemic has changed the structure of office demand.

Due to COVID-19, technology and online shopping utilisation have increased significantly, which led to the expansion of e-commerce companies last year, it reported.

The pandemic has also changed the real estate strategies of occupiers. Previously employees were heavily relying on being in office, but are now more willing to work in different spaces.

Pham Ngoc Thien Thanh, associate director, CBRE Vietnam, said: “COVID-19 has reshaped the market’s dynamics, and unaffected sectors will drive market demand in 2021.

“Besides, tenants will start paying more attention to all factors including saving rental costs, ensuring employees’ wellness and maintaining business performance.

“To do that, occupiers tend to adopt a hybrid workplace model, designing offices with lower density and also diversifying the workplace into different sites such as decentralised options and co-working spaces.

“The market will be intensely competitive in the next two years with a wave of new supply. To stay ahead of the competition, landlords should consider applying workplace strategy tools to evaluate current strengths and deficiencies of their buildings to come up with an optimal solution to increase their assets’ values.”

The HCM City office market remained in a deep slump last year due to COVID, which badly affected many enterprises. It witnessed negative net absorption of – 20,544sq.m of leasing area.

Three new office buildings came into the market, Friendship Tower (grade B), UOA Tower (decentralised grade A) and Opal Tower (grade B), with a combined 65,372sq.m of net leasing area, but it represented a fall of 31 per cent in area compared to the previous three years.

Switching to HNX can help reduce overload on HoSE: VNDirect CEO

Market regulators should consider policies to encourage companies listed on the Ho Chi Minh Stock Exchange (HoSE) to temporarily switch to the Ha Noi Stock Exchange (HNX), said CEO of VNDirect Securities Co Do Ngoc Quynh.

He said such a move aimed to help mitigate the overload of the transaction system at HoSE while awaiting the completion of a new technology system for the whole market, he said.

Since the end of 2020, Viet Nam’s stock market has witnessed a booming trading period with multi-session liquidity of more than VND15 trillion (US$653.2 million).

The wave of new investors entering the stock market has helped set new liquidity records, which is a positive signal for the market, he said.

As interest rates are still at low levels and people’s understanding of the financial market is improving, this can be considered a very favourable period for attracting investors and developing Viet Nam’s stock market.

However, skyrocketing liquidity has far exceeded market forecasts, leading to frequent congestion in many sessions, causing a lot of trouble for investors and affecting the quality of the market.

“The sudden increase in liquidity recently is unpredictable, causing undesired interruptions in trading,” said Le Hai Tra, Chairman of the Board of Members of HoSE.

“To tackle this issue, the State Securities Commission said it was speeding up the implementation of a new information technology system for the entire stock market, known as KRX.

“However, due to the impact of the COVID-19 pandemic, the implementation of the new system is delayed and if the disease progresses more complexly, it will be difficult to continue the plan,” he said.

In the short term, one of the solutions applied by the State Securities Commission (SSC) is to increase the minimum trading volume for a transaction on HoSE from 10 to 100 shares to help reduce the burden on the transaction system.

Although officially in place at the beginning of 2021, congestion still occurs when investors flock into the market and push the liquidity to new heights, sometimes reaching $1 billion per session.

The SSC has also instructed the HoSE to request securities companies to review, limit errors arising from the companies’ processes, limiting automatic transactions to avoid negative impacts on the system, to check internal control, control risks, limit errors that may occur in the trading system and arrange staff on shift duty at peak transaction times.

In the short term, as the KRX system is not immediately available while trading demand is huge, a temporary solution is to transfer some companies from HoSE to HNX, said Quynh.

This can be considered as an appropriate step because the Prime Minister issued Decision 37/2020/QD-TTg to establish the Vietnam Stock Exchange (Vietnam Exchange), based on the merger between HoSE and HNX.

“This is the quickest and least costly solution at the time being. This will not only help to reduce the overload on the HoSE system but also ensure the smooth transaction of the Vietnamese stock market, meeting the legitimate trading needs of investors, ensuring credit of the stock market in the eyes of domestic and foreign investors, maintain an effective capital mobilisation channel for enterprises in the economy,” he said.

If the SSC approves and facilitates administrative procedures for companies to switch from the HoSE to HNX, VNDirect will volunteer to help them with the transferring procedures, Quynh added.

Wood exports enjoy sharp increase during January

Vietnam’s timber and wood exports in January witnessed a surge of 48.4% to US$1.25 billion in comparison to the same period from last year, according to figures released by the Ministry of Agriculture and Rural Development (MARD).

The United States, Japan, and China remain the three largest importers of Vietnamese timber and wooden products last year, making up 78.1% of the country’s total export value.

Most notably, strong export growth has been seen in markets such as the US, Thailand, and Canada with the export value rising by 33.8%, 20.4%, and 14.1%, respectively, while wood exports to the UK endured a downward trajectory of 26.5%.

Furthermore, the import value of wood and wooden products in January recorded an annual rise of 64.8% to US$280 million.

Last year saw the total import value of wood and wood products increase by 0.6% to US$2.56 billion compared to 2019, of which imports from China, the US, and Thailand made up 33.7%, 12.2%, and 5.1%, respectively.

In line with these figures, local imports of timber and wooden products from China and Thailand saw a boost of 31.1% and 14.7%, respectively, while imports from the US suffered a decrease of 8%.

The MARD stated that 2020 proved to be a successful year for the wood industry despite facing an adverse range of impacts caused by the novel coronavirus (COVID-19) pandemic. The resilience of the Vietnamese wood industry in recent times can largely be attributed to the openness of the local legal system, coupled with the enforcement of various free trade agreements (FTAs).

Moreover, the MARD have revealed that there remains plenty of room for wood exports to grow in the near future as the global furniture market has a commercial value of approximately US$450 billion per year, of which wooden furniture makes up roughly US$150 billion annually. Meanwhile, Vietnamese wooden furniture exports account for only 6% of the global market share.

Moving forward, the local forestry sector aims to export US$14.5 billion this year, a rise of 12% compared to 2020, with timber and wooden products set to reach a figure of US$13 billion.

China increases imports of cassava chips and starch from Vietnam

Vietnam exported 400,000 tonnes of cassava and cassava-based products worth US$144 million in January, with the market share of Vietnamese cassava chips and starch as part of China’s total imports last year increasing sharply compared to 2019’s figures.

These statistics show a rise of 88.1% in volume and 97.1% in value compared to the same period from last year, while the average export price recorded an increase of 4.8% to US$360 per tonne, according to data released by the Ministry of Industry and Trade.

According to figures compiled by China Customs, Chinese import of cassava chips increased by 22% last year to US$782.85 million compared to 2019, with the country joining Thailand, Cambodia, and Laos as the four largest suppliers of cassava chips to China.

Most notably, the nation was the second largest provider of cassava chips to China last year with US$95.91 million, an increase of 90.8% compared to 2019.

Last year saw the neighbour import 2.75 million tonnes of cassava starch worth US$1.13 billion, a rise of 16.1% in volume and 9.7% in value compared to 2019, with the majority being imported from Vietnam Thailand, Laos, and Cambodia.

Most notably, the nation  was the second largest provider of starch to China last year with 982,480 tonnes worth US$ 388.76 million, up 30.4% in volume and 24.9 % in value in comparison to a year earlier.

Thai group purchases 70% stake in Vietnamese plastics manufacturer

It is expected that SCGP’s acquisition will be completed in the first half of 2021. Duy Tan manufactures household plastic containers with a capacity of 116,000 tonnes per year.

The company’s increased investment in Vietnam is in line with its strategic plan, which foresees an increase in the diversity of products, including plastic and paper packaging, as well as the development of domestic design teams, according to Wichan Jitpukdee, CEO of SCGP.

“We are prepared to work with all partners to share experience and knowledge in the development of integrated packaging solutions and support the growing demand for diverse types of packaging among customers in ASEAN,” Jitpukdee added.

During the past decade, the Thai company has continuously increased investment in Vietnam, which has yielded a revenue growth of more than 10% annually.

All three projects of the company in Vietnam including Vina Kraft Paper Co., Ltd. in the southern province of Binh Duong, the packaging producer Tin Thanh Packing JSC and Bien Hoa Packaging JSC are expected to contribute to its increased sales of about 8.5 billion baht (US$283.1 million) per year.

The Thai company is also looking into expanding its paper production capacity in the north of Vietnam. “This is to satisfy domestic demands and expansion of export markets, which will be a boon to Vietnam’s economic growth as well,” Jitpukdee said.

Imports and exports of FDI sector enjoy sharp increase in January

The total import and export value of foreign direct investment (FDI) enterprises in January saw a surge of 60.1% to US$39.16 billion, equivalent to an increase of US$14.69 billion, according to figures compiled by the General Department of Vietnam Customs.

The country’s import and export value throughout January soared by 48.2% to US$55 billion, equal to an annual rise of US$17.88 billion.

In relation to the figure, total Vietnamese exports increased sharply to US$28.55 billion, while imports also soared by 41.3% to US$26.46 billion against the same period from last year, with the country recording a trade surplus of US$2.09 billion.

Most notably, the total import and export value of the local FDI sector rose by 60.1% to US$39.16 billion, while the domestic sector’s imports and exports increased by 25.2% to US$15.85 billion on-year.

The export value of FDI enterprises also skyrocketed by 70% to US$21.57 billion compared to the previous year, therefore accounting for 75.5% of the country’s total export value. In addition, its import value rose by 49.4% to US$17.59 billion, making up 66.5% of the country’s total import value.

Source: VNA/VNN/VNS/SGGP/VOV/NDO/Dtinews/SGT/VIR

During the period, total import-export revenue through border gates in Lao Cai reached over 11 million USD, including 2.4 million USD worth of imports, mainly fertilisers and farm produce, and 8.8 million USD worth of exports, mostly agricultural products.

In 2020, despite the impact of COVID-19, the Border Gate Customs Sub-Department under the Lao Cai Department of Customs completed its “twin targets” by processing customs clearance declarations for 516 businesses with import-export value of over 1 billion USD and ensuring safety from the pandemic.

In 2021, it will closely coordinate with other sectors to speed up administrative reform while exhibiting better performance in e-customs clearance activities to save time and cost, ensuring economic development and COVID-19 prevention and control at the same time./.

Local automobile group exports over 200 units, parts

Automobile producer THACO recently shipped more than 200 Kia vehicles and auto parts to Thailand, Myanmar, Japan, and the Republic of Korea (RoK).

The conglomerate’s largest export consignment to date, made on February 17, comprised of cars, buses and semi-trailers manufactured at its factories at the THACO-Chu Lai Industrial Park in central Quang Nam province.

The exports included 80 Grand Carnival cars to Thailand, the company’s seventh consignment to its partner, Yontrakit, since December 2019.

One hundred and twenty Kia Soluto cars were shipped to Myanmar, the sixth batch to this market.

Kia cars manufactured by THACO are increasingly appreciated by customers in ASEAN countries since their quality is equivalent to those made in the RoK and meets global Kia standards, while their prices are very competitive.

In 2021, THACO plans to export 1,480 automobiles to Thailand and Myanmar, expand exports to other markets, and gradually achieve its goal of becoming a production and export base for Kia Motors cars and spare parts in the ASEAN region.

This is THACO’s first export of semi-trailers to Japan, one of the most challenging markets in the world with stringent quality requirements.

It exported through its Nippon Trex, a leading manufacturer and exporter of semi-trailers in Japan.

Nippon Trex carried out extensive research on and technical discussions about semi-trailer product development in the Japan before appreciating THACO’s capacity and collaborating with it to manufacture and export semi-trailers to the market.

This time THACO also exported buses to Thailand via VOLVO Group’s VOLVO Buses Corporation, one of the world’s biggest manufacturers of large buses.

THACO buses were selected by VOLVO Buses for shipping and distributing in Thailand since they met all requirements in terms of technology, quality, safety, and competitive prices and Thailand’s standards and certification requirements (with respect to design, size, ECE certificates, and others). The company uses over 60 per cent locally made parts.

The shipment kicked off THACO’s plans to export 66 buses to Thailand and South Korea this year.

In addition to cars and semi-trailers, auto parts too were exported to the RoK, including seat covers, gearshift covers, air-conditioning radiators, and specialised vehicle components for Hyundai Santafe. The consignment was worth 200,000 USD.

With the import tax on CBU cars within the ASEAN bloc scrapped since the beginning of 2018, many car assemblers in Vietnam have switched to importing and distributing cars, whereas THACO has been expanding production and increasing the use of local parts to serve its strategy of exporting to Southeast Asia.

This year THACO will continue to export to existing markets Thailand, Myanmar, the Philippines, the US, and Japan and expand to other ASEAN countries, with a total of 2,500 vehicles. It expects to earn 30 million USD from exports of auto parts and other mechanical products.

Exports of large numbers of cars since last year have attested to the fact that cars made in Vietnam can compete in foreign markets, which is gradually helping raise the country’s profile in the global market.

THACO plans to increase exports to ASEAN and enter new markets in Africa, West Asia, South Asia, Australia, and elsewhere./.

Dinh An Economic Zone – driving force for Mekong Delta region

The Dinh An Economic Zone in the Mekong Delta province of Tra Vinh is one of eight coastal key economic zones in Vietnam. With an orientation to develop a multi-sector economic zone associated with sustainable marine economic development, Dinh An has focused on investment to become an economic driving force of the province and the Delta.

Dinh An has attracted nearly 50 projects to date with total investment capital of about 6.7 million USD. It is expected that by 2030 it will contribute up to 80 percent of the provincial budget.

Dinh An also has a strategic position in economic development associated with security and defence. Despite its huge potential, however, investment attraction in the zone is still lower than its potential.

Existing bottlenecks are hindering the Dinh An Economic Zone from becoming a driving force for economic development in Tra Vinh and the Mekong Delta as a whole./.

Conference discusses role of Vietnam in Asia-Europe partnership

A conference has been held in Moscow to discuss the outlook of the Eurasian Economic Union (EAEU) and the role of Vietnam and Belarus in the expansion of the Asia-Europe development space.

Addressing the event, President of the “Asia-Europe House” Association Alexander Makhlaev highlighted the role of Vietnam’s traditional values in the country’s development.

He held that the political stability has paved the way for Vietnam’s economic development.

Meanwhile, Natalya Ivanova, an expert from AV Group, underlined the significance of international business environment in the integration process of each country.

She asserted that the EAEU is creating a new motivation, especially for the strengthening of cooperation among member countries as well as with partners, including Vietnam.

According to Chairman of the Council of Experts of the Eurasian Research Fund Grigory Trofimchuk, Vietnam, a dynamic developing country and a member of many integration mechanisms and international organisations, is working hard to speed up integration process.

Vietnam is the first partner to sign a free trade agreement with the EAEU in 2015, he noted, adding that the union should focus more on partnership with Vietnam as the country is a door to the world.

The official highlighted the dynamism of Vietnamese firms in Russia as well as other countries in the world. However, he said that Vietnam and the EAEU have yet to optimise each other’s advantages and potential, while a number of trade barriers between the two sides are still existing.

He held that both sides should discuss the maintaining of trade defence measures to increase trade in the future, adding the EAEU should show its advantage in the current period when the COVID-19 pandemic is developing complicatedly in the world.

Within the conference’s framework, Trofimchuk introduced his book entitled “Vietnam wings up”, expressing his hope that the book will help Vietnam and Russia become closer together in economy, trade and humanity./.

Investment booms as Soc Trang improves business climate

Soc Trang province’s efforts to improve its business climate is paying off with more and more investors, both domestic and foreign, coming since 2016.

The Mekong Delta province has worked with hundreds of potential investors seeking to invest in areas where the province has strengths like hi-tech agriculture, tourism and wind and solar power.

It approved 116 projects with a total investment of 27.3 trillion VND (1.18 billion USD) in 2016-20, 5.5 times the amount in the previous five years.

Nine of them are FDI projects.

Soc Trang authorities have been making efforts to improve the investment climate and provincial competitiveness by focusing on infrastructure and providing lands for projects.

They are keen on projects that are sustainable and environment-friendly.

Nguyen Thi Thuy Nhi, deputy director of the province’s Department of Natural Resources and the Environment, said her department had been reforming administrative procedures, boosting the province’s competitiveness in terms of attracting investment and business climate.

One key infrastructure project is the upgrade of Tran De deep-water port, which will reduce logistics costs for exports from the Mekong Delta.

The recently approved Chau Doc – Can Tho – Soc Trang highway will connect to the port, aiding goods transportation and improving links with the rest of the country.

The province is also creating a start-up eco-system with development assistance, incubation programmes and sponsorship for creative small and medium-sized businesses.

In the last five years 1,900 new businesses were set up, a 47.2 percent increase from 2011 – 15. Many companies have invested in manufacturing in the An Nghiep Industrial Park, creating tens of thousands of jobs.

In 2021 – 25 Soc Trang seeks to further improve its business climate and competitiveness, focusing on business assistance services, labour training and helping investors start projects smoothly.

There are 3,300 registered businesses in the province with a total charter capital of 33 trillion VND.

Soc Trang’s economy grew by 6.75 percent in 2020./.

Legal move supports realty market development in 2021

According to Ha Quang Hung, deputy head of the Housing and Real Estate Market Management Department under the Ministry of Construction, many policies regulating housing and real estate market growth have been improved and aligned with the current regulatory system on investment, construction, and doing business.

Significantly, the Law on Construction 2020 has been united with the Law on Housing, Law on Real Estate Business, and the Law on Environmental Protection regarding investment proposal approval, investor approval, or developer recognition, creating a healthier and more transparent investment environment while mitigating speculation and price manipulation activities.

“In 2020, despite the impacts of COVID-19, the real estate market still managed fair growth of about 8-11%, if indirect factors like capital, land, and building materials were taken into account,” said Hung.

Le Hoang Chau, chairman of the Ho Chi Minh City Real Estate Association opined that several revised laws (Law on Investment, Law on Securities Business, and Law on Enterprises) coming into force from January 2021 have bolstered market growth.

“The realty market has undergone the most difficult period and will gradually rebound. Positive legal changes would motivate firms to join the affordable housing and mid-level segments more robustly,” he said.

From another angle, Su Ngoc Khuong, senior director at Savills Vietnam, a leading real estate consultancy firm, noted that the success of the 13th National Party Congress would bring vitality to the whole economy, particularly the real estate, especially in Ho Chi Minh City and Hanoi – Vietnam’s two growth engines.

The new “city in city” urban form of in Ho Chi Minh City is deemed an inspiring breakthrough, whereas in Hanoi transport infrastructure has witnessed noteworthy improvements.

In addition, experts assumed that fiscal and monetary policies in the past decade have proven successful, with well-controlled interest rates.

Nguyen Van Dinh, deputy general secretary of the Vietnam Real Estate Association (VNREA), outlined two scenarios for market development in 2021.

In the first scenario, with the mindset “cash is king” lingering in the first and second quarter of 2021, the market will be full of challenges due to low transaction volumes. COVID-19 will only be contained by the middle or the end of the first quarter with no new infections reported, allowing the market to gradually rebound.

In the second scenario, the pandemic would drag on to be contained no sooner than June. In this scenario difficulties would continue mounting. Accordingly, housing prices in the primary market are expected to shed an average 5% compared to last year, with sales volumes taking a plunge.

For commercial real estate, the lingering pandemic would lower operation efficiency as well as occupancy rates, while resort real estate would remain in “hibernation” the way it was in early 2021.

The latest report by Colliers International Vietnam forecast that more than 4,000 shop houses would be released in the Ho Chi Minh City market in 2021. The birth of Thu Duc City would fuel the development in the city’s northeast. Colliers data also show that products from six projects in Thu Duc, Binh Chanh, and Nha Be districts will enrich supply in the upcoming time.

Businesses urged to capitalise on opportunities to increase exports

Local businesses have been advised to diversify their markets to intensify import and export activities this year, alongside maximising the benefits of free trade agreements (FTAs), restructuring export products, developing stronger brands, whilst grasping market information and changes in the policies of importers, according to insiders.

With an impressive trade surplus of over US$19 billion last year, the industry and trade sector aims to increase the total export turnover for this year by between 4% and 5%, with the country’s trade surplus anticipated to maintain its momentum.

Despite this, Vietnamese exports this year are largely dependent on the prospects of the global economy, particularly if the novel coronavirus (COVID-19) pandemic can be brought under control.

With regard to the export situation in the year ahead, Vu Duc Giang, chairman of the Vietnam Textile and Apparel Association (VITAS), said textile and garment exports this year will continue to face numerous difficulties ahead in the post-pandemic period. In line with this, Vietnam is likely to export goods worth between US$37 billion and US$38 billion providing that the pandemic is brought under control globally.

Giang pointed out that over the long-run, the Vietnamese garment and textile sector will continue to encounter challenges over the subsequent three years, noting that exports to major markets gradually return to a normal state once the pandemic is successfully curbed by the end of the third quarter of 2023.

He emphasised that new-generation FTAs, especially the EU-Vietnam Free Trade Agreement (EVFTA), the Regional Comprehensive Economic Partnership (RCEP), and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) can be expected to boost exports moving forward.

Experts have therefore attributed these difficulties to the current low level of market diversification among some agricultural and aquatic products, pointing out that although several products enjoy a tariff reduction of 0%, a number of domestic agricultural products have been not been allowed to gain entry into some markets.

Furthermore, despite the proportion of the FDI sector’s export value decreasing in recent years, it accounts for over 64% of the country’s total export value. This is due to the sector’s production and export activities being largely dependent on regional and global supply chains.

Moreover, the impact of the rising trend of protectionism, trade conflicts, and complicated developments of the COVID-19 pandemic globally have changed the structure of global supply chains, with several countries, especially the United States and western nations, strengthening trade protectionism measures.

Phan Thi Thanh Xuan, vice president and General Secretary of the Vietnam Leather, Footwear and Handbag Association, revealed that the leather and footwear sector has made the best use of the EVFTA, adding that the industry’s exports are poised to grow by between 15% and 20% this year if the COVID-19 epidemic is successfully contained.

Xuan underlined the need to devise stronger policies aimed at accelerating the development of the local supporting industry so it can independently produce raw materials and avoid a heavy reliance on imports.

In an effort to maintain the export growth in the year ahead, the Ministry of Industry and Trade is expected to help businesses take full advantage of opportunities from FTAs by removing barriers for market expansion and keeping a close watch on the developments of the COVID-19 pandemic in order to take timely response measures.

She pointed out that new generation FTAs ​​such as the CPTPP and the EVFTA are expected to provide fresh impetus to export growth over the coming year thanks to tariff incentives, adding that the shift in FDI investment flow from regional countries to the nation, along with the restructuring of supply chains, will also contribute to boosting exports this year.

Key solutions that can promote import and export activities moving forward will largely focus on diversifying markets, maximising the benefits from relevant FTAs​, restructuring export products, developing brands, whilst grasping market information and changes in policies of importers, Xuan noted.

Deputy Minister of Foreign Affairs Le Hoai Trung also underscored the importance of opportunities brought about by FTAs while urging the local ecnonomy to improve its autonomy to prepare for any worse-case scenarios and utilising the system of commercial counselors to perform tasks in line with these changes.

Minister of Industry and Trade and deputy head of the Party Central Committee’s Economic Commission Tran Tuan Anh, said there will be a positive outlook for the country in the years ahead thanks to favourable conditions from integration strategies and the enforcement of FTAs.

In addition, the Government’s schemes on economic restructuring, social security, reforms, open-door policies, and efforts to fine tune the legal system will also be beneficial.

Domestic food and beverage industry has development potential

The domestic food and beverage market has great potential for development despite the difficulties caused by the COVID-19 pandemic, according to experts.

Hanoi – The domestic food and beverage market has great potential for development despite the difficulties caused by the COVID-19 pandemic, according to experts.

Food and beverages are in the fast-moving consumer goods (FMCG) category. For many years, this has always been one of the important economic sectors with great potential for development, according to the Vietnam Report 2020.

The food and beverage market’s growth rate is forecasted to reach from 5-6 percent annually in 2020-2025.

Despite suffering negative impacts from the COVID-19 pandemic, the food and beverage industry in Vietnam also has many strong growth opportunities. At present, more and more consumers pay attention to nutritional foods of plant origin, organic foods or food with healthy ingredients.

A survey conducted by Vietnam Report at the end of 2020 showed due to COVID-19, half of customers have spent more on foods boosting their immune system and clean foods. Meanwhile, 63.7 percent of customers have cut spending on alcohol and beer. Therefore, businesses in this industry must adjust their production to suit demand.

Food businesses have to increase their production capacity by about 30 percent, while beverage businesses must reduce their production to lower than 80 percent compared to before the pandemic.

Besides that, Vu Dang Vinh, general director of the Vietnam Assessment Report Joint Stock Company, said COVID-19 has forced nearly 70 percent of food and beverage businesses to focus on the digital transformation for survival and development, reported the Vietnam News Agency.

Many businesses have built modern technology processes in production and management. Food and beverage companies have also sped up investment activities to renovate the distribution system and adjust the proportion between traditional and modern trading channels. They develop applications to enhance the customer experience when shopping and innovate packaging design, eco-branding and product line development.

Nguyen Dang Quang, chairman of Masan Group, said the COVID-19 pandemic is a good opportunity to promote e-commerce.

The group is building plans to attract more and more people to online shopping, he said.

Vinh said food and beverage businesses need to focus on strategies such as revenue growth, market development, promotion of research and improving product quality. They should also diversify supply sources with priority for domestic suppliers and develop online distribution channels on e-commerce platforms.

According to experts in the food and beverage industry, the stable macroeconomy and commitments in free trade agreements signed between Vietnam and its partners such as the European Union-Vietnam Free Trade Agreement (EVFTA) and the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) would bring export opportunities and more foreign investment. They would promote the transfer of technology and technological advancement in the industry.

Along with that, the food and beverage companies need to improve their competitiveness and increase investment in infrastructure systems and modernisation of production processes and corporate governance.

Foreign investors divest Ninh Van Bay due to bleak performance

Two foreign investors, namely Recapital Investments Pte., Ltd and Belton Investments Ltd., decided to divest Ninh Van Bay Travel Real Estate JSC, the developer of Six Senses Ninh Van Bay Resort in Nha Trang.

Notably, Recapital Investments Pte., Ltd. issued an announcement to sell 10.7 million shares at Ninh Van Bay Travel Real Estate to decrease its ownership from 11.9 per cent to zero. Recapital Investments is an investment fund owned by Rosan P. Roeslani, the former president of Inter Milan football club.

Besides, Belton Investments Ltd. has also registered to sell its entire 6.4 million shares, equaling 7.07 per cent of the stake, in this company. The sale is expected to be completed between February 5 and March 1.

Previously, in 2013 Recapital Investments bought 30 million shares at the price of VND7,500 (32.61 US cents) apiece. Belton Investments has been a large shareholder since 2012. However, since 2019, both investors started to decrease their ownership in Ninh Van Bay Travel Real Estate.

The reason for the divestment may be the bleak business results of Ninh Van Bay.

Notably, the company listed its stake on the Ho Chi Minh City Stock Exchange in 2010 with the initial price of VND30,000 ($1.30) apiece, however, the stocks plunged to VND1,000 (4.35 US cents) apiece in 2017. Besides, the company suffered a loss of VND479 billion ($20.83 million).

After two years of restructuring, the company reported a profit of VND27 billion ($1.17 million) in 2019, more than 13 times the figure of VND2 billion ($86,960) in 2018. In 2020, the company acquired VND211 billion ($9.17 million) in net revenue, down 24 per cent on-year. The main reason for this bleak business result came from the impact of the COVID-19 pandemic.

At present, Ninh Van Bay stocks are traded at VND5,680 (24.70 US cents), rising 22 per cent over the past three months.

Upbeat export-import picture in early 2021

Many of Vietnam’s growth engines have posted impressive export-import performance, with Ho Chi Minh City, Bac Ninh, and Binh Duong being the top performers.

The latest statistics from the Vietnam General Department of Customs show that the country raked in $55 billion in total export-import turnover in the first month of 2021, a 48 per cent jump on-year.

Many localities have posted fairly impressive growth in their export import value compared to the corresponding period in 2020 despite the impacts of the recent COVID-19 reemergence.

Leading the list is Ho Chi Minh City which counted $8.9 billion in total export-import value, followed by Bac Ninh with $7.7 billion, Binh Duong with $5 billion, Thai Nguyen with $4.4 billion, and Hanoi with $3.8 billion.

Many localities have posted fairly impressive growth in their export import value compared to the corresponding period in 2020 despite the impacts of the recent COVID-19 reemergence.

This is an impressive performance as Hai Duong needs to ramp up efforts to carry out the dual target of preventing and curing COVID-19, while still ensuring socio-economic development.

Last year, the province attracted nearly $7.76 billion in total export value and more than $6 billion in total import value, and carved out a place among the localities with biggest export-import value in the northern region.

Quang Ninh, Lao Cai, and Lang Son (the major export players) have increased business even during the Lunar New Year holiday. For instance, on the first three days of the new year, the Lao Cai International Border Gate’s Customs Bureau had completed customs clearance for 4,000 tonnes of export-import goods valued at more than $2 million.

In Ho Chi Minh City, right on the eve of the Lunar New Year, Saigon New Port Corporation conducted a ceremony to receive goods marking the New Year of the Ox.

In 2020, the cargo volume calling on Ho Chi Minh City’s Cat Lai port rose 8.2 per cent, making it one of the top performers worldwide in cargo throughput volume. This year, the cargo volume through Cat Lai port is expected to surge 5 per cent.

More than 7,000 tonnes of goods passed through each day Mong Cai International Border Gate Customs Bureau under Quang Ninh Customs Department during the Lunar New Year holiday.

The Ministry of Industry and Trade forecast that export business would maintain its growth momentum in February, especially in localities hosting the manufacturing complexes of South Korean tech giant Samsung Group, leveraging the proliferation from January 2021. The exports of handsets and accessories could lift up, capitalising on Samsung’s fresh roll-out of new items such as Samsung Galaxy S21, Samsung Galaxy S21 Plus, and Samsung Galaxy S21 Ultra.

Larger frame of mind for logistics

Throughout more than three decades of economic reform, Vietnamese companies from many sectors have been venturing abroad and become role models. Yet, the logistics sector remains too focused on the domestic market. Tran Thanh Hai, deputy director of the Ministry of Industry and Trade’s Agency of Foreign Trade, emphasised that local players should follow regional examples and take their business to international arena.

In this context, logistics activities were affected significantly, with railways, roads, and air transport being the most heavily affected, while waterways and warehouses remained largely unscathed and even saw growing business due to rising inventory.

Different from five years ago, logistics have been given due attention by all state levels, as shown in the directive documents of the government, ministries, and branches, that all considered logistics a crucial aspect of the economy. From there, policy changes and significant investments in infrastructure could be accomplished, along with the easing of administrative procedures for businesses in this sector.

However, one of the current challenges is the lack of large-scale Vietnamese enterprises with influence in the logistics industry, while large foreign-invested enterprises (FIEs) such as FedEx, UPS, and DHL from the United States and Europe dominating the country’s logistics sector.

In Vietnam, telecom, real estate, and manufacturing enterprises have built outstanding businesses that drive their respective industries. Within the logistics sphere, however, there is no such role model.

Companies like Saigon Newport, Gemadept JSC, Transimex JSC, and Sotrans Co., Ltd. are contributing their share but can hardly be called outstanding yet. The general picture of today’s businesses is stiffening, with competing FIEs operating in Vietnam, while those from other countries are integrating into global markets.

Additionally, the domestic logistics sector remains rather small with limited international operations, while this industry is really about going global and partaking in imports and exports. So far, the number of Vietnamese enterprises operating in foreign markets is also small, with even the bigger names not providing services to foreign markets. In the era of global integration, we must go to the world to develop, and thus this remains the Achilles heel of the domestic industry. Moreover, weak links with other service providers elsewhere have not been established and utilised sufficiently. Although Vietnamese manufacturers have been able to export goods to Europe in large volumes, there is no logistical presence of local companies.

As such, logistics groups stop all operations at Vietnam’s gates, after selling and delivering goods to customers, resulting in low added value and a lack of competitiveness against foreign counterparts.

Against this backdrop, the largest difficulties relate not to capital but to the awareness of Vietnamese entrepreneurs, who are typically shy in new environments, especially when confronting foreigners. Many businesses dare to run their operations but mostly focus on the domestic market as they feel that doing business in their own country is easier. Problems here can be handled the familiar Vietnamese way, while they would have to follow foreign rules outside and establish new personal networks and relations. Within the current logistics community, FIEs and state-owned enterprises are relatively stable, but the private sector consists mainly of small-scale businesses, with some newly established or separated from others.

In Vietnam, the number of FIEs is increasing constantly, with nearly 40 multinational corporations and many smaller ones present in the market. However, companies from Japan and South Korea are very ethnocentric and prefer to use the services of their country’s enterprises, which support and protect each other. Meanwhile, European and American businesses are somewhat more open-minded. They use traditional services but do not pay much attention to their partners’ country of origin. Multinationals have financial advantages, so it is easier for them to establish a foundation and attract high-quality human resources than it is for domestic ones. They also make great use of experienced CEOs.

The great advantage of FIEs is their cooperative relationship with partners worldwide. From these relationships, they provide most of the services requested by manufacturers at competitive prices. The service quality of these enterprises is often at a higher level than that of domestic ones, reflected in their professionalism, the assurance of standardised service quality, and strict rules and norms, which provide credibility for these businesses.

Those businesses also pay special attention to customer care and focus on the long-term benefits, instead of immediate returns. Therefore, at some stages, they even accept losses to win customers’ sympathy and build a reputation. Meanwhile, some Vietnamese businesses follow a fast-paced approach that aims for quick profits rather than long-term relationships and market presence. Such a mentality will also not pay attention to quality.

Models to follow

With a growth rate of 12-14 per cent per year, Vietnam’s logistics sector is growing, albeit merely gradually. It may take another 5-10 years to see strong differences today. As this speed remains slow, Vietnam’s logistics needs to go faster to avoid lagging behind other countries.

Up to now, Vietnam’s logistics growth has mainly relied on the scale of commodity production, consumption, and import-export, which are natural factors for growth advantages. However, these are not intrinsic factors of the logistics sector, they are just objective ones.

If one of these factors changes – such as COVID-19, natural disasters, and the declining domestic demand – the sector’s growth will suffer if it is not well established in foreign markets.

Thus, Vietnamese groups need to step out of their comfort zone, adapt quickly, and avoid thinking of themselves as small and inferior. Small does not mean weak.

At present, Vietnamese enterprises focus only on the domestic market, and give little thought to venturing abroad. Meanwhile, I am confident that Vietnam’s logistics can provide decent services to the regional market, such as Laos, Cambodia, and Thailand – all of which are close by and of similar development levels. Vietnam already has top enterprises in leather, footwear, steel, and automobiles. Thus, the logistics sector can build on their experience and develop leading groups from those sectors.

Singapore can also be a good example for Vietnam. Its government was determined to put all its advantages into developing the logistics sector and to turn Singapore into the largest transshipment port in the world. To do that, Singapore has largely sacrificed marine tourism. Nowadays, the island nation is housing some of the leading enterprises in logistics fields. It boasts PSA Co., Ltd., the world’s largest port operator, which also has a joint venture in Vietnam’s Cai Mep port complex in the south.

In the aviation industry, it has Singapore Airlines – a 5-star airline which for many years maintained its position as the world’s leading airline. Before the pandemic hit, Changi Airport was consistently one of the busiest airports in the world.

Another model is Taiwan, which has strong logistics development. Of course, there are also more developed economies like Japan or Germany whose level of development is already at a much higher level. The country needs it, the government needs it, and the businesses that want to grow strong also need to be bold and venture abroad with an outward-looking spirit. Vietnam opened its doors to global integration 35 years ago, but it is now up to businesses to step out or not. The government alone cannot do this.

Vietnam’s mobile devices reached the export value of $51 billion last year

Mobile devices and components produced in Vietnam last year were exported to 50 markets and reached the export value of more than $51.18 billion, according to the latest data published by the General Department of Vietnam Customs.

In comparison with 2019, export value was slightly down 0.4 per cent. Nevertheless, it is still one of the Vietnamese economy’s main sectors by occupying nearly one-fifth (18 per cent) of the export value.

China remained the largest consumption market for the goods category with $12.34 billion, making up 24 per cent of Vietnam’s export turnover from mobile phones, and up 48.8 per cent on-year. Europe was the second-largest export market with a turnover of $9.9 billion, up 18.9 per cent on-year.

The runners-up were the US, South Korea, and the United Arab Emirates with $8.79 billion, $4.58 billion, and $2.53 billion. In addition to China, other markets like Hong Kong, Canada, and Japan last year increased their purchasing of mobile devices and components from Vietnam by 44.14 per cent to $1.73 billion, 34.3 per cent to $826.23 million, and 16.5 per cent to $937.75 million, respectively.

2020 is the first year Vietnam has seen a plunge in the export turnover of mobile devices and components. Over the previous 10 years, the sector has been going from record to record, even recording triple-digit growth in a few years like in 2011 when it hit 178.3 per cent.

Thanks to that, mobile devices and components exceeded garment and footwear production to become the sector with the largest export value for Vietnam, mainly driven by foreign-invested enterprises, lead by Samsung. To date, about 60 per cent of the South Korean giant’s items are produced in Vietnam.

Impetus for rubber suppliers to bounce back even higher

Although expectations for an increase in rubber prices remain low, the recent spikes have left rubber growers in Vietnam less worried. Nevertheless, to cash in on the recovering carmakers and other industries after the pandemic, as well as compete with regional rivals, local latex gatherers may need to step up their game and apply for official certificates.

More than an hour’s drive from Pleiku, the capital of the Central Highlands province of Gia Lai, small roads are running through immense rubber forests. The town of Ia Kha is crowded with more than 8,000 people, but unlike in the past, these people are less occupied with farming than before.

Ro Mah Kiu, a worker in the 15 Corporation at 74 Company, often wakes up at 3am to scrape latex. When he was still farming, he lacked the necessary skills, often left behind a wasteland, and struggled all year round. As his life remained difficult, Kiu became worried about his future.

Eventually, he joined 74 Company’s local farmer support group to focus on latex extraction. But it was not easy to become a latex farmer. Proper care for mature rubber trees is tricky and learning the right technique for extracting the latex from the tree even more so.

The pandemic caused a scarcity in labourers and made it difficult to gather and process latex. Colonel Hoang Van Sy, commander of the 15 Corporation, told VIR, “The recruitment of new workers is cumbersome. Workers lost their jobs in other industries and returned to their localities in huge numbers, but after being recruited for latex exploitation, it always takes a lot of time training for them to become skilled enough for the job.”

In addition, between 2018 and 2019, the corps saw nearly 3,000 workers reaching retirement age, leaving a hole in the corps’ workforce that has yet to be filled.

Unlike in many other sectors, workers in the rubber industry are not just dependent on markets but also the weather, which sometimes leads to heavy impacts on price calculation.

“We are forced to cut input costs to a minimum, from over VND50 million ($2,175) per tonne of latex to VND32 million ($1,400) to reduce the pressure on prices,” Sy said.

The long chain of declining prices in the rubber sector had lasted for nearly 10 years, with few people thinking they would ever bounce back. However, in the last months of 2020, rubber prices at the Osaka exchange – the reference for the natural rubber market in Europe and Asia – experienced nine consecutive gains. On October 28, the most-traded April 2020 futures contract increased by ¥20 (19 US cents, equalling 7.9 per cent) to ¥274.3 ($2.65) per kilogramme, the highest closing price since March 2017. The increase in this session was also the highest since the end of 2008.

Reversing prices for rubber can be easily envisioned in a period of economic development, but with 2020, a year of stagnation and economic decline amid the pandemic, market interference from the Chinese market becomes more apparent. Statistics of the Chinese Customs Department said that in the first 11 months of 2020, China’s rubber imports reached $9.76 billion, up 4.5 per cent compared to the same period in 2019.

The staggering market recovery can also be explained by the fact that rubber production in China last year dropped by 30 per cent on-year, due to massive storms on Hainan Island and droughts in Yunnan province.

China has seen a significant increase in imports with only a gradual decrease in consumption. The 11-month data of Vietnam’s Ministry of Industry and Trade shows that China spent $4.34 billion, up 35.2 per cent over the same period in 2019, for the import of a popular mixture of natural and synthetic rubber.

Meanwhile, the Chinese auto industry – one of the key sectors for rubber consumption – remained on a downturn due to the global health crisis. Although the situation is slowly improving, the China Association of Automobile Manufacturers estimates that sales in 2020 dropped by 10 per cent, much lower than forecast.

The ability for rubber prices to recover globally stands in stark contrast to the decrease in supply. The Association of Natural Rubber Producing Countries (ANRPC) predicts that in 2021, global rubber production could recover to around 13.7 million tonnes, an increase of 8.6 per cent compared to last year. However, even with this increase, 2021’s production would still be lower than that of 2019 and 2018, with about 13.8 million tonnes.

Rubber production across Southeast Asia, which accounts for two-thirds of global natural rubber supply, has been severely affected by labour shortages due to the pandemic, natural disasters, and other disadvantages. The demand-supply gap is widening, while rubber traders fear the supply shortage will be further exacerbated by the continuing political instability in Thailand and the uncontrolled pandemic.

According to the ANRPC, 2020’s production decreased by about 6.8 per cent compared to 2019, to 12.9 million tonnes, mainly due to the decline in Thailand and India, of which Thailand’s output decreased by about 332,000 tonnes. This corresponds to the forecast of the Rubber Authority of Thailand on last year’s production, which was already estimated to be about 10 per cent lower due to the constant rains in the south of the country.

In Vietnam, the trend of decreasing latex plantation areas is also apparent at some large suppliers.

Dong Nai Rubber Co., Ltd., which had specialised in natural rubber supply, has started its plan to reduce 40-50 per cent of its exploitation and preliminary processing by 2025 to switch into fields with higher margins. According to Do Minh Tuan, general director of Dong Nai Rubber, latex exploitation so far contributed around 70-75 per cent of the company’s revenue. Last year, the firm even recruited 250 more locals as workers but remained unable to make up for the shortage to meet production goals.

Less worried farmers

Although some multilateral deals like the EU-Vietnam Free Trade Agreement have opened a door for exports to grow, Vietnam’s rubber sector has yet to make real use of these opportunities. The EU market has a large demand for high-end rubber, for which Vietnamese producers could provide the input materials. According to statistics from the General Department of Customs, the European market accounted for merely 5.1 per cent of the total export volume of 1.1 million tonnes of rubber within the first nine months of 2020.

Meanwhile, Huynh Tan Sieu, head of technology and environment at the Vietnam Rubber Industry Group, pointed out that local businesses also miss out on the opportunity to further the competitiveness of Vietnamese rubber in the global market by not applying for the FSC forest management certification, which confirms social and environmental characteristics of a company’s operations.

John Heath, commercial director at London-based natural rubber company Corrie MacColl Ltd., said in January that the European market is currently paying much attention to FSC-certified rubber. His company is distributing about 500 tonnes of certified latex to the European market each month, “a very small fraction of the growing demand for FSC-certified rubber in this market,” Heath explained.

In response to growing pressure from civil organisations and consumers, companies take more responsibility for supply chains, and Heath said that Corrie MacColl aims to “do the right thing, so it will not buy rubber from customers who cut primary tropical forests to plant rubber.”

Good products and official forest certifications have enabled 15 Corporation to access markets outside of China, led by the desire to reduce the focus on a single export market. As such, customers from Russia, Sweden, India, and Japan are considering buying the company’s latex and rubber.

However, since costs are currently higher for sourcing from the Central Highlands, “sustainable solutions with mutual benefits have to be agreed on,” said Sy of the 15 Corporation.

He hopes that the output of the 40,000ha will suffice this year to reach the targeted 10-15 per cent increase in revenue and secure the jobs of more than 10,000 workers. In 2020, the corporation banked a gross revenue of over VND1.5 billion ($65.2 million).

Vietnam leading car dealers struggle with Covid-19 impacts

While car prices in 2020 were significantly lower compared to the pre-Covid-19 period, customers had become more cautious in spending, leading to an 8% year-on-year drop in car sales to 296,634 units.

Major car dealers in Vietnam, including Savico, Haxaco and City Auto, posted modest return on sales (ROS) of 1-2% in 2020, mainly due to customers tightening their belt amid a difficult Covid-19 year.

“The pandemic had led to fierce competition in car prices, causing a downturn in the company’s business performance,” stated Savico in its financial statement.

Savico, a distributor of major car brands of Toyota, Volvo, Honda, Mitsubishi, recorded the highest revenue among the three with VND16.13 trillion (US$700.2 million), down 12% year-on-year, and profit of VND224 billion (US$9.72 million), or ROS of 1.38%.

While car prices in 2020 were significantly lower compared to pre-Covid-19 period, customers had become more cautious in spending, leading to an 8% year-on-year drop in car sales to 296,634 units, data from the Vietnam Automobile Manufacturers’ Association (VAMA) noted.

City Auto, a major distributor of Ford and Huyndai, suffered a same fate with a decline of 11% year-on-year in revenue to VND5.67 trillion (US$246.1 million) and net loss of over VND4 billion (US$173,800).

Last year, City Auto predicted a challenging year of 2021 for the automobile industry following a sharp drop in market demand.

In a letter to the Ho Chi Minh City Stock Exchange, City Auto attributed its negative business performance to lower car sales volume.

In contrast, Haxaco, a leading Mercedes-Benz car dealer in Vietnam, recorded a rise of 8% year-on-year in revenue to VND5.57 trillion (US$241.8 million) and after-tax profit of VND125 billion (US$5.42 million), up 150% year-on-year.

A senior official at Haxaco said the firm took advantage of the government’s policy of reducing 50% of the registration fee for domestically-produced cars to boost sales revenue. However, Haxaco’s ROS remained at a modest rate of 2.24%.

A study from SSI Securities Corporation suggested 2021 could start the upward trend of Vietnam’s automobile industry with a 16.3% year-on-year growth rate in terms of car sales number, citing high demand from the domestic market for cars.

Source: VNA/VNS/VOV/VIR/SGT/Nhan Dan/Hanoitimes

The STARSHIP URSA of Marshall Island

Vietnam welcomed two foreign commercial vessels, STARSHIP URSA of Marshall Island and CMA CGM J. ADAMS of Malta, to ports in Ho Chi Minh City and the southern province of Ba Ria – Vung Tau on February 12, the first day of the Lunar New Year, according to the Vietnam Maritime Administration (VINAMARINE).

A representative from the authority said in the first months of 2021, the maritime industry has recorded strong growth.

Despite difficulties posed by the COVID -19 pandemic, Vietnam still recorded impressive growth in trade, especially exports to Europe and America, because of the high demand from these markets.

The increasingly modern and comprehensive seaport infrastructure and transport system have also created a momentum for the maritime industry’s development.

The operation of deep-water seaports will promptly replenish container berth infrastructure to serve the growing demand of customs clearance

In order to meet the increasing cargo transportation demand in recent times, VINAMARINE has directed sea port authorities to coordinate with State management agencies to speed up the processing of administrative procedures for ships.

It has also worked with management agencies of ports and shipping companies to develop marine safety plans to allow port calls by large ships./.

First dragon fruit lot exported to China in new Lunar Year

Some 190 tonnes of dragon fruits were shipped to China through Kim Thanh II International Border Gate in the northern province of Lao Cai on February 12, the first day of the lunar New Year.

According to the Lao Cai Border Gate Customs Sub-Department, the lot, the first to be exported to China in the lunar New Year, was worth 2.8 billion VND (121,512 USD).

Departing from the Mekong Delta province of Long An, the lot was transported through the border gate in a safe manner with quick customs clearance and strict implementation of preventive measures against COVID-19 pandemic.

In 2020, 1.15 billion USD worth of goods was transported through Kim Thanh International Border Gate, including 606 million VND worth of exports. In the year, 337 million USD worth of dragon fruits were exported to China through the gate./.

Vietnam maintains stable exports to Israel in 2020

Vietnam earned an estimated 700 million USD from exporting goods to Israel in 2020 despite difficulties and obstacles posed by the COVID-19 pandemic, according to the  Vietnamese Trade Office in the Middle East country.

The figure showed a slight reduction from 774 million USD reported last year. This is said to be a positive result in the context that the Israeli market witnessed fluctuations, disturbances and difficulties amid political instability and negative impacts from the pandemic.

Notably in November last year, Vietnam’s export value to Israel surged by 27.2 percent compared to the previous month, reaching 51.04 million USD.

Turnover of most key export items rose strongly in the month, with coffee up 108.6 percent, footwear (35 percent), phones and accessories (31 percent), and textiles and garments (21.4 percent) cashew nuts (16.9 percent), and seafood products (3.3 percent).

Israel, with a population of only 9.3 million, is the third largest export market of Vietnam in the Middle East, after the United Arab Emirates (UAE ) and Turkey./.

Khanh Hoa’s tourism sector looks forward to rebound in 2021

The COVID-19 pandemic has costed Khanh Hoa province a negative growth of 10.5% and budget collection shortage of over 25%. Tourism is the hardest hit sector in the locality. The locality has sped up several stimulus programmes to rock the market in the coming time.

In the coming time, Khanh Hoa province looks to introduce stimulus tourism packages and new tourism products and services to attract visitors. In the instant future, it has deployed a contest for new logo and slogan for Khanh Hoa’s tourism sector to renew the province’s image in visitors’ eyes.

COVID-19 vaccines have sparked hope of economic recovery globally, especially in tourism industry. Khanh Hoa province, whose spearhead economic sector is tourism, is also looking forward to a big rebound in 2021./.

Bamboo Airways announces pre-tax profits of over 17 million USD

Bamboo Airways has recently announced its pre-tax profits of over 400 billion VND (17.38 million USD) in 2020, up 34 percent year-on-year.

The airline attributed the profit to the favourable conditions thanks to the Government’s drastic and effective pandemic prevention and control measures, and its own proactive and prompt solutions to overcome difficulties.

It is currently operating nearly 30 aircraft, including the most modern types such as Boeing 787-9 Dreamliner, A321NEO ACF and Embraer E195. The fleet is expected to reach 50 this year.

Last year Bamboo Airways transported a total of over 4 million passengers, up 40 percent in the numbers of flights and passengers against those of 2019.

HCM City aims for 33 million tourists in 2021

The southern largest economic hub of Ho Chi Minh City has set a target of welcoming 33 million tourists with total revenue of more than 4.3 billion USD in 2021.

Some notable events include the 8th HCM City Ao dai Festival and HCM City Tourism Day, along with tours at old Sai Gon’s relics.

Last year, the city’s tourism market suffered greatly from the COVID-19 pandemic. The total number of international visitors to HCM City in 2020 was 1.3 million, down 84.8 percent year on year, while the number of domestic travellers to HCM City was 15.8 million, a decrease of 48.4 percent year on year.

Total tourism revenue was estimated at nearly 3.7 billion USD, down 39.6 percent compared to 2019./.

Vietnam gains cassava export growth in 2020

Vietnam gained growth in the export of cassava chips and cassava-made products in 2020 despite the COVID-19 pandemic, according to the Department of Agricultural Product Processing and Market Development.

Exports last year reached 2.76 million tonnes, earning 989 million USD, an increase of 9 percent in volume and 2.4 percent in value compared to 2019. However, the average export price of those products reduced by 6 percent to 358.3 USD per tonne year on year.

In December alone an estimated 330,000 tonnes with a value of 118 million USD were exported.

Impacts of the COVID-19 pandemic did cause problems for the cassava production industry according to the department under the Ministry of Agriculture and Rural Development, but it was still one of the few agricultural products with a positive growth in export value.

The exports of cassava chips in 2020 reached 640,000 tonnes, earning 139 million USD, up 60 percent in volume and 75 percent in value over the same period last year. The average export price for this product reached 217 USD per tonne, up 10 percent.

Tapioca export was estimated at 2.1 million tonnes with a value of 850 million USD, down 1 percent in volume and 4 percent in value over the same period in 2019. Its average export price reached 401 USD per tonne, down 4 percent.

According to the department, China was the largest export market with the total volume of cassava chips and cassava-made products reaching 1.9 million tonnes, earning 772 million USD. That’s an increase of 11.5 percent in volume and 2.7 percent in value compared to 2019.

Taiwan and Malaysia were also two other largest export markets of Vietnamese cassava with the growth in export value of 15 percent and 3 percent year on year, respectively, in the first 11 months of 2020.

In China market, Vietnam is currently the second largest supplier of both cassava chips and tapioca, according to China’s General Department of Customs./.

Online trade promotion helps businesses adapt to COVID-19

The spread of COVID-19 around the world created difficulties for businesses in promoting their products and seeking new customers but many were prompted to change trade promotion strategies and adapt.

Bui Thi Thanh An, Vice Director of the Trade Promotion Agency at the Ministry of Industry and Trade, said nearly 50 national-level trade promotion programmes were cancelled or postponed last year due to the pandemic.

This had a major effect on export activities and the economy in general, she said.

To address the situation, the agency has sped up the introduction of information technology (IT) and changed how trade promotion activities are held.

Since March when COVID-19 spread globally, the agency has changed all trade promotion activities to online. More than 500 international online trade conferences have now been organised, along with more than 1 million online trade exchanges.

These events helped connect more than 2,000 businesses with foreign partners in different markets, An said.

The agency has also coordinated with foreign customers based in Vietnam, such as AEON and Central Group, to organise special “weeks” featuring Vietnamese products, through which many goods have been selected for sale in foreign-owned supermarket chains around Vietnam and then headed to foreign markets.

It has also made use of social networks and Vietnamese trade offices abroad to support businesses seeking markets, An added. Such efforts contributed to maintaining export growth and speeding up economic recovery, while helping enterprises remain updated on market developments, trends, and demand, she added.

Though online trade promotions have become more common since the pandemic broke out and were initially considered just a temporary solution, experts and enterprises agree that they will now become a key part of the trade promotion ecosystem.

Vietnam’s economy is heavily reliant upon exports, so the country must adapt to sudden disruptions to international trade. Taking advantage of IT platforms to seek trade opportunities is considered the most feasible option at this time.

Zacharie Blondeau, Sourcing Director at Source of Asia, said business-to-business (B2B) is the most effective method of connection, but in certain contexts, such as pandemics and travel restrictions, businesses should actively connect online.

An underlined that even after COVID-19 is fully brought under control, online trade promotions will continue to be organised.

The Trade Promotion Agency is developing digital technology-based platforms to create a new promotion ecosystem comprising of online trade fairs and exhibitions and online databases and origin tracing, creating the conditions necessary for enterprises to access trade promotion programmes at the lowest cost and with the greatest efficiency.

She advised businesses to regularly participate in online and direct trade exchanges, conferences, and workshops, while actively digitalising their operations by improving websites and joining large and reputable e-commerce platforms./.

Fresh impetus could spur on Vietnamese economic growth in 2021

Vietnam is capable of achieving a higher GDP growth rate than the set target of 6% in 2021, providing it accelerates reforms and draws up proper plans for economic recovery in the post-COVID-19 period, according to economist Nguyen Dinh Cung, former Director of the Central Institute for Economic Management.

Cung, who is also a member of the Prime Minister’s economic advisory think-tank, underlined the need to immediately launch stimulus packages in an effort to bolster the economy, promote the development of new sectors, and mobilise all resources for a more dynamic economy.

The country’s successful containment of COVID-19 in 2020 coupled with its recent socio-economic development achievements indicate the resilience of the national economy, especially the business resilience shown by local firms during this challenging period.

It’s the Government’s prompt response and timely support for local firms that helped the country to record several major economic achievements last year, the economist told VOV.

Cung also pointed out that while the global economy slipped deeper into recession due to COVID-19, Vietnam was one of few economies that enjoyed positive growth last year.

“The 2.91% growth rate in 2020 will create the prerequisite for the country to even beat the 6% target as set by the National Assembly for this year should the government continue with radical reforms and a thorough economic recovery plan,” said the economist.

According to Cung, 2021 is the first year Vietnam starts implementing the freshly-concluded National Party Congress’s resolution and the new socio-economic development strategy ti;ll 2030. Therefore, he expressed his belief that this year’s breakthroughs will lay a solid foundation for future socio-economic development.

The economist went on to underscore the importance of facilitating the sustainable development of the private economic sector, accelerating efforts of institutional reform, and launching new stimulus packages aimed at aiding the economy.

“Institutional reform must be stronger and more comprehensive with a focus on simplifying administrative procedures, improving the business climate, and carrying out radical reforms to raise the market level of the economy, especially the allocation and use of resources in an effective manner,” he noted.

As part of efforts to help the private economic sector develop steadily and become an important driving force for Vietnamese economic development, Cung stressed the need to make stronger transformations, liberalise the domestic market, reduce costs for enterprises, and re-allocate resources towards building a wealthy and strong nation.

The economist also called for the removal of barriers faced by businesses, whilst protecting their legitimate rights and interests, along with fine-tuning the legal system and facilitating the application of science and technology for further development.

It is essential to form and develop large private economic groups that can boast great potential and stringent competitiveness in both regional and international markets, he suggested, anticipating with the goal of having at least two million enterprises by 2030, the private economic sector can contribute between 60% and 65% to the country’s GDP by this date.

Local businesses increase production capacity for Tet

An array of local businesses have devised plans in which they offer promotions and ramp up communication activities in an effort to serve people before, during, and after the Lunar New Year festival or Tet.

A wide variety of food and beverage products at stable prices will be distributed to supermarkets, shops, traditional markets, and e-commerce channels, with an abundant supply of goods.

According to the Department of Industry under the Ministry of Industry and Trade, at present most firms operating in the processing and manufacturing industries have temporarily halted production ahead of Tet, with the exception of a few enterprises involved in the paper and cement industry. Indeed, a handful of companies will maintain a certain output throughout the holiday period due to the specific characteristics of production lines that require regular operation.

Furthermore, some businesses in other industries such as electronics and car production will still maintain operations as a part of their production lines, although they will not complete any new products.

As a labour intensive industry, garment and footwear enterprises must employ many workers from different localities throughout the country, meaning that they have to give their employees time off for the Tet holidays, according to the Government’s announced schedule. Despite being impacted by the novel coronavirus (COVID-19) pandemic, the industry still recorded positive growth compared to the same period from last year.

Most notably, the textile production index and garment production index recorded respective increases of 16.6% and 9.9% compared to the same period from last year. Indeed, textile and garment export turnover in January was estimated to be US$2.6 billion, an annual rise of 3.3%, while footwear export turnover of all kinds in January hit an estimated US$1.8 billion, up 26.4% over the same period from last year.

Electronic businesses are therefore catching up with the trend of shifting production from multinational electronic corporations, thereby opening up plenty of opportunities to participate in the global supply chain.

By January, the domestic electronics industry had grown by 38% compared to the same period from last year. As such, local electronic businesses will take Tet holidays according to the schedule announced by the Government and will not have to maintain continuous production over Tet.

With regard to fertilizers, due to the preparation for cultivation in the Winter-Spring crop over the first days of the Lunar New Year, the price of various fertilizers tends to increase. Providing that the total amount of fertilizer meets demand and there is no shortage of goods, there will also be no price hike.

Moreover, the power supply to the national power system has come up with a plan to ensure that there are no problems in the power source and grid, especially before, during, and after Tet.

Milk consumption to grow by 7% this year: securities brokerage

Milk consumption is expected to increase by 7 per cent this year, analysts at SSI Securities Corporation have said.

They said it is based on a baseline scenario that assumes the pandemic would be controlled by mid-year and there would be no more social distancing.

They also forecast the prices of existing SKUs (stock keeping unit) would not increase this year.

But they admitted demand among low-income consumers could be impacted given the fact that COVID-19 has hurt them, and companies like Vinamilk and Vinasoys have seen downtrading in the first nine months of last year.

In contrast, premiumisation would continue as middle- and high-income groups are less impacted, and are more open to consuming higher quality dairy products, they said.

“We assume dairy raw material prices will increase by 4 per cent in 2021. Also, higher oil prices in 2021 are likely to affect packaging and shipping costs.”

The study also found that investors are paying more attention to environmental, social and governance criteria when investing in dairy companies.

As a result, the sector has begun to diversify its products, including shifting to plant-based beverages.

According to market research company Euromonitor, the dairy industry was worth VND135 trillion (US$5.84 billion) last year, an increase of 8.3 per cent from 2019, thanks to the rapid growth in the yogurt and fresh milk segments.

Currently, modern distribution channels only account for 10-15 per cent of dairy sales, but analysts expect it to outpace traditional channels.

Recognising the trend, companies are now focusing on the former, they said.

But according to SSI, it would mean lower profit margins due to the fierce competition between a multiplicity of brands.

The dairy industry is expected to see more M&A deals this year after a number of them involving leading companies took place last year, such as Vinamilk’s acquisition of a controlling stake in Moc Chau Milk and the acquisition of IDP by investment consultant Blue Point and asset management firm VietCapital.

Both acquired companies saw profits skyrocket after the deal.

Moc Chau’s net profit grew by 68 percent year-on-year in the first nine months of 2020 and IDP’s was up nearly 34 per cent.

There is fierce competition in the market with the appearance of new players, the SSI report said, adding that Masan Group has recently launched new dairy products, B’fast cereal milk, while Vitadairy has been expanding rapidly in the powder milk segment.

Saigon Hi-Tech Park seeks to attract investment in tech, supporting industries

The Saigon Hi-tech Park will create favourable conditions to attract investment in the tech and supporting industries this year, its head has said.

Dr Nguyen Anh Thi, head of the board of management of Saigon Hi-tech Park (SHTP), said the park has this year set an FDI target of US$200 million.

It recently issued investment registration certificates to two major hi-tech projects.

They include $19.5 million by US company Arevo to manufacture 3D-printing machines and carbon fibre and nanotube-reinforced polymers for 3D printing and provide software services.

Korea’s SNST and Finger Vina have invested $1 million to produce high quality integrated circuits.

Last year Hong Kong company TTI, Inc., a wireless industrial electrical equipment manufacturer, invested $650 million in the park and is looking for local suppliers to increase its use of local parts.

It plans to set up a plant and an R&D centre with the intention of making Viet Nam its new manufacturing base.

It wants to increase investment in manufacturing for export, while simultaneously developing German-standard training schools to improve the quality of the Vietnamese engineering workforce.

It is set to encourage companies to relocate to Viet Nam to join its supply chain.

The plant will manufacture hand-held power tools with integrated technology for designing and manufacturing control devices, electronic transformers, mechanical engineering products, and others.

As part of its efforts to attract investment, the park has organised high-tech supporting industry development programmes to help local firms link up with lead firms, through business matching activities between foreign and Vietnamese enterprises, and with export processing zones and industrial parks around the country.

The park has also developed 162,000sq.m of high-rise factories for local firms in supporting industries, according to Thi.

Hua Quoc Hung, chief of the HCM City Export Processing and Industrial Zones Authority (HEPZA), said his agency has set an investment target this year of $550 million in industrial parks and export processing zones.

Science and Technology Park

Speaking at a recent meeting Thi said the park would focus on building a ‘world-class’ science and technology park.

It has a vision of laying the foundation for development of high-tech industries in HCM City, he said.

“We aim to create an environment to improve the quality of human resource training as this is the most important factor in production.”

He said it is important to enhance links between educational institutions, businesses and the park.

In the last 20 years various types of science and technology park models have sprung up globally such as innovation centres, incubation centres, innovation towns, and public science and Al technology urban areas.

In 2011 the city began consulting experts for building the park at a cost of more than VND4.3 trillion ($185 million).

The new park will tie up with educational and research institutes as part of a city programme to improve the quality of human resources, especially in new technologies.

Central city to develop hi-tech supportive industries

Plans are in the pipeline to build an industrial park in Da Nang dedicated to supportive industries.

It is part of the Government’s master plan of industrial park development from 2030-2045.

It will be built on the edge of the Da Nang Hi-Tech Park.

Head of the city’s Hi-Tech park and the Industrial Zones Authority (DHPIZA), Pham Truong Son said the decision was signed by Deputy Prime Minister Trinh Dinh Dung, and the 58.5ha supportive industries park will offer investment for domestic and foreign businesses.

Son said the supportive industry park, which is sandwiched between the Hi-Tech Park and Da Nang Information Technology Park in Hoa Vang District, has completed 85 per cent of infrastructure since 2016.

He said Da Nang has yet developed supportive industries – one of the disadvantage factors of the city in luring investment from domestic and foreign investors.

Son said the city wants to boost the development of supportive industries over the next decade.

The city has been building a development plan on three new industrial zones – Hoa Cam, Hoa Nhon and Hoa Ninh on total 880ha – for approval by the Prime Minister.

According to DHPIZA, the construction of the three new IZs would be soon commenced in 2021.

The city has called for investment for infrastructure works on the three new IZs in 2020-23 with an estimated investment capital of VND13.8 trillion (US$604 million).

The new IZs have been designed as ‘green’ and ‘clean’, and hopes to attract hi-tech and environmentally-friendly industries.

The Da Nang-based Sunshine Aerospace components manufacturer plant, which was invested by the Universal Alloy Corporation from the US worth $170 million, began operation after one year of construction in March of 2020.

Da Nang’s industrial infrastructure projects offer advantage location for investors as it boosts connection of key traffic routes including the Da Nang-Quang Ngai Expressway, the Chan May Economic Zone in Thua Thien-Hue, the Chu Lai Economic Open Zone in Quang Nam and Dung Quat Economic Zone in Quang Ngai Province.

The Hi-tech Park and IZs would be a magnet for global industrial firms and producers, offering flexible land rent, land clearance, income tax and import tax policies.

Investors with projects valued at more than $133 million will enjoy a 10 per cent tax rate for 30 years, according to DHPIZA.

Struggling shopkeepers at HCM City traditional markets learn to sell online

With traditional markets in HCM City struggling amid the COVID-19 pandemic, more and more of their shop owners are looking to sell their goods on online channels such as delivery apps and social media.

According to the management of Ben Thanh Market in District 1, most stalls except those selling fresh produce have few customers, especially handbag, clothing and handicraft shops.

Demand has dropped by 80 per cent compared to the same time last year, and around half the stalls remain closed.

An Dong Market in District 5 is suffering a 90 per cent drop despite a recent renovation that has greatly improved its appearance.

Nguyen Thanh Chau, head of the management of Thai Binh Market, said sales were down by half and some stalls that closed down had not even reopened for Tet.

Traders learn online selling

Traders in markets have been looking at selling online. Truong Thi Hue, who sells clothes at An Dong Market, said for the past two months her daughter had been showing her how to use Facebook and Vietnamese social media Zalo to sell her products.

Nguyen Thi Thai Trang, another clothes seller in the same market, said after she took part in an online Cho Lon Market fair last September, she was able to network with many businesses, including Co.opmart, which greatly benefited her business and her employees.

She has asked An Dong Market also to organise online market fairs.

Foodstuff, fruit and vegetable traders in Ben Thanh Market are selling their products via delivery service Grabmart.

Duong Thi Thanh Thuy, a confectionery seller there, said while her family business had been relying on customers and tourists over the last 60 years, she now had to make use of technology.

According to Nguyen Thi Ngoc Anh, a beo (water fern) cake seller in the market, doing business through food delivery service Now.vn boosts her income by around 30 per cent helping it survive COVID-19.

Some traders said selling online had not been profitable so far since it was still new to them, but, nevertheless, these were new channels and in the long run could be more profitable.

Ben Thanh Market is working with the District 1 Information Technology Centre to improve its website to help traders sell their goods online.

Tran Huy Cuong, director of District 5’s Centre for Economic Development and Labour Supply Assistance, said the district had organised online fairs to help traders get used to using online channels. They were also being taught how to use social media to sell their goods, take photos and write about their products, he added.

According to Associate Professor Pham Khanh Phong Lan, head of the city Food Safety Management Board, many Tet food items are being sold online, a low-cost method that limits close contact during the pandemic, but safety risks are involved since there are no checks.

While traders on large online platforms are monitored, small ones that operate on social media such as Facebook are not well monitored, and so customers should look for trustworthy sites to shop.

The city reduced shop rents in traditional markets by half for the last six months of 2020.

Pandemic reveals enterprises’ view of responsibility

The unprecedented challenges arising from the COVID-19 pandemic have highlighted more than ever the importance of responsible crisis management and sustainable development at enterprises.

Viet Nam’s successful containment of the virus significantly helped leverage the image of the country and its enterprises globally, according to Vo Tri Thanh, director of the Institute of Branding and Competition Strategy. It also confirmed the importance of corporate social responsibility (CSR) efforts, associating enterprises’ brands with social responsibility and sustainable development, he said.

“Many enterprises, not only large ones but also small and medium-sized enterprises, shared the burden with the Government and citizens during the time of crisis,” he said.

“Their sense of responsibility towards the community and society will certainly be recognised and be a very good basis for post-pandemic recovery and development.

“We saw Vietnam Airlines bringing Vietnamese abroad home, while Viettel, VNPT, and FPT lowered telecommunications fees. Electricity of Vietnam cut power prices, Hapro and Co.op Mart stabilised prices, and many other companies joined hands in the fight against COVID-19.”

In August, Vingroup gave the Ministry of Health DrAidTM software and attached devices to provide prognosis assistance in novel coronavirus treatment. The first AI software introduced helps to rapidly identify abnormalities based on upright chest X-rays in less than five seconds and adds to the accuracy of test results, reduces false negatives, and assists in enhancing treatment consistency and knowledge transfer from central-level doctors to grassroots-level doctors.

The country’s leading real estate conglomerate also donated 3,200 ventilators to the Ministry of Health to help combat COVID-19 and sponsored chemicals for 56,000 COVID-19 PCR tests in Da Nang City, Hai Phong City, and Bac Ninh Province.

Towards sustainable development

Developing sustainably, contributing to growth, and ensuring social welfare would be at the core of enterprises’ development, said Vu Tien Loc, chairman of the Viet Nam Chamber of Commerce and Industry.

“Never in history have we seen the world change so quickly and considerably,” Loc went on. “The world is changing constantly, requiring that every government, every economy, and every enterprise be resilient and innovate to keep up with the speed of change and develop sustainably.

“It is in the historic challenge of the COVID-19 pandemic that we see enterprises’ efforts to maintain jobs, restructure and prepare for recovery, and work with the Government and the community to fight the virus.”

According to Nguyen Xuan Duong, vice president of the Viet Nam Textile and Apparel Association, CSR contributes significantly to resolving social problems like the pandemic.

CSR proves that when a business cares about social issues, there will be a positive impact on its profitability, which will help increase its value and sustainability.

Hoang Ngoc Hai from the Academy of Politics Region 1, in an article published in Tap chi Tai chinh (Finance Journal) wrote that CSR should not be seen only as an action to resolve social problems for charitable and humanitarian purposes.

“CSR should be understood as a way in which a business strikes a balance between economic, environmental, and social requirements, and at the same time meets the expectations of shareholders and partners,” Hai wrote.

“It can help support enterprises’ brands and bring benefits, which contribute to creating humanistic value and building a corporate culture as well as increasing competitiveness in the context of rapid international integration.”

Still, many enterprises do not fully understand the importance and benefits of CSR, as exhibited through many committing business fraud, producing poor-quality products, and causing environment pollution to maximise profits.

According to Tran Thi Tra My from Thuong mai University (Commerce University), to have an appropriate action plan, enterprises must understand pressing social issues.

She pointed out that, in recent years, Viet Nam had faced increasing challenges in climate change and environmental pollution, which were threatening social welfare and human health as well as the sustainable development of the ecosystem. There were also difficulties in providing education and building a future for the young.

My cited a survey by the Institute of Labour Science and Social Affairs carried out on 24 garment and footwear enterprises, which found that revenue was up around 25 per cent for those with a CSR programme.

During international integration, the implementation of CSR has become a must, according to My, and will not only bring benefits to enterprises and to society but also help improve the competitiveness of enterprises and the country as a whole.

“It is necessary to develop mechanisms and policies to support enterprises in implementing CSR initiatives,” she said.

Construction firms urged to apply technology to improve efficiency

The impacts of the COVID-19 pandemic and Industry 4.0 required construction firms to invest in technology to improve efficiency.

According to the Ministry of Construction, more than 1,500 enterprises operating in the construction industry completed dissolution procedures in 2020, demonstrating that the COVID-19 pandemic had negative impacts on the operation of these companies, although the Government lowered banking interest rates last year to aid enterprises.

Another problem was that input costs increased significantly while real estate prices did not see a corresponding increase, which also affected operation efficiency.

The ministry said that the real estate market was showing signs of recovery but the recovery was not taking place as rapidly as expected. In addition, legal problems at a series of property projects were causing stagnation in construction.

Large firms also encountered difficulties.

Nguyen Xuan Dong, general director of Vinaconex Corporation, said that the company’s revenue in 2020 fell by 42 per cent against the previous year, in which construction revenue dropped by 45 per cent and real estate business by 86 per cent.

Economic expert Can Van Luc said that the Vietnamese economy expanded at three per cent in 2020 despite the impacts of the COVID-19 pandemic, higher than the world’s average.

The gross domestic product (GDP) growth rate in the 2018-19 period averaged around 6.8 per cent, forecast at 6.5-7 per cent in 2021 and seven per cent on average in the next 10 years. The positive economic prospects would fuel the development of the real estate market and provide opportunities for construction enterprises to expand operation and enhance efficiency in the future, Luc said.

According to Cao Van Ban from the Viet Nam Association of Construction Economy, the macroeconomic situation and the positive prospects for real estate market recovery were opening new opportunities for construction companies to develop but also bringing challenges and new requirements.

Ban said that constrution firms must raise solutions to speed up construction progress, lower costs and improve quality.

“The most important thing to construction companies at the moment is to take advantage of science and Industry 4.0 to create breakthroughs,” Ban stressed.

For State-owned construction enterprises, it was necessary to strengthen restructuring and renovation through privatisation to improve efficiency, he said.

Renovating technology is an unavoidable trend, not only for construction enterprises.

The Prime Minister in late January issued a national technology renovation programme to 2030 which set the target that the number of enterprises renovating technology increases by 20 per cent per year on average.

Investment booms as Soc Trang improves business climate

Soc Trang Province’s efforts to improve its business climate is paying off with more and more investors, both domestic and foreign, coming since 2016.

It has worked with hundreds of potential investors seeking to invest in areas where the province has strengths like hi-tech agriculture, tourism and wind and solar power.

It approved 116 projects with a total investment of VND27.3 trillion (US$1.18 billion) in 2016-20, 5.5 times the amount in the previous five years.

Nine of them are FDI projects.

Soc Trang authorities have been making efforts to improve the investment climate and provincial competitiveness by focusing on infrastructure and providing lands for projects.

They are keen on projects that are sustainable and environment-friendly.

Nguyen Thi Thuy Nhi, deputy director of the province’s Department of Natural Resources and the Environment, said her department had been reforming administrative procedures, boosting the province’s competitiveness in terms of attracting investment and business climate.

One key infrastructure project is the upgrade of Tran De deep-water port, which will reduce logistics costs for exports from the Mekong Delta.

The recently approved Chau Doc – Can Tho – Soc Trang highway will connect to the port, aiding goods transportation and improving links with the rest of the country.

The province is also creating a start-up eco-system with development assistance, incubation programmes and sponsorship for creative small and medium-sized businesses.

In the last five years 1,900 new businesses were set up, a 47.2 per cent increase from 2011 – 15. Many companies have invested in manufacturing in the An Nghiep Industrial Park, creating tens of thousands of jobs.

In 2021 – 25 Soc Trang seeks to further improve its business climate and competitiveness, focusing on business assistance services, labour training and helping investors start projects smoothly.

There are 3,300 registered businesses in the province with a total charter capital of VND33 trillion.

Soc Trang’s economy grew by 6.75 per cent in 2020.

Source: VNA/VNN/VNS/SGGP/VOV/NDO/Dtinews/SGT/VIR

Le Hoang Diep Thao – the CEO of King Coffee, received the Most Admired CEO award in 2020 from Global Brands Magazine (GBM) and conceived a project called ‘Women Can Do’ to help 100,000 women to launch a start-up.

Ms. Le Hoang Diep Thao – CEO of King Coffee in a supplied photo

Continuing her success in 2020, Thao was officially appointed by the Vietnam Coffee and Cocoa Association (VICOFA) to the position of vice president for the ninth term (2017-20).

In a discussion with Tuoi Tre (Youth) Newspaper, Thao talked about her passion for coffee and her ambition of building a Vietnamese characteristic in the global coffee market.

“A coffee girl”

Talking about coffee, your face exudes an extraordinarily strong passion. What sparked this passion for you and how has it been nurtured?

“I was born and grew up along with coffee nuts. My love for coffee is so strong that it can be felt by everyone surrounding me, including friends, farmers, to merchants, so they called me ‘a coffee girl’ as a nickname during my childhood.

To me, coffee is a treasure of humanity. Vietnam is fortunate to be blessed with this magical treasure by nature, so I am determined to make coffee processing a national strategic industry of our country.

From the opportunities of meeting with coffee experts and reading books on this topic, I understand more about the dark side of the production chain, so I have to do something for the farmers and the country’s coffee industry.

My next opportunity was brought by Vu [Dang Le Nguyen Vu, chairman and CEO of Trung Nguyen Group], who is a very excellent person that shared this passion with me. Together, along with Trung Nguyen, we elevated the third wave of coffee, thus changing the way the Vietnamese enjoy coffee.

Vietnamese now find that choosing coffee is choosing a lifestyle, and their own unique tastes.

During my time in Italy, I regularly paid visits to second-hand markets to hunt for coffee antiques. Seeing that I was so enthusiastic, a person told me that they ‘would sell the coffee museum that I loved so much to you.’

According to many experts, Vietnam has a marvelous opportunity to break through and become the number one powerhouse in the coffee industry. As vice president of VICOFA, do you believe that?

I believe in it and I have repeatedly affirmed that Vietnam is the second largest coffee exporter in the world and the number one for exporting Robusta coffee. We are fully able to rise to become the world’s number one coffee exporter.

The entire world’s coffee industry is worth more than US$200 billion, ranking second after that of oil. We need to further elevate the coffee industry with other segments in the global value chain. We need to create motivation from which Vietnamese coffee can break through. We also need an innovative mindset, thoroughly aimed towards responsible creativity and sustainable development.

We now have good brands, good coffee quality, and good conditions. Therefore, please support Vietnamese brands, so Vietnamese coffee is able to make a fast and strong global expansion instead of adoring foreign brands, which do not contribute to our country’s coffee industry, or to Vietnamese farmers.

Currently, coffee beans are sold at VND5,000 ($0.22) per kilogram, but a cup of coffee is sold at $5. What a terrible disparity! The farmers must work so hard to care for coffee trees, but they have not received worthy results because coffee prices are too low and precarious.

Le Hoang Diep Thao smiles when she poses for a photo in a supplied photo

“Women Can Do”… with coffee

In 2020, she received the Global Inspiring Entrepreneur Award and launched a project “Women Can Do” with the aim of helping 100,000 women to start a new business.

What is the message you want to convey with your “Women Can Do” project?

I have thought long and hard about what I can contribute to the community, especially the women. I think of a livelihood for them to actively earn money, an opportunity to gain financial knowledge. The women will be able to receive financial support and specific guidance and be involved in a community to help each other…. Coffee is an answer to the problem.

Given these thoughts, from mid-June 2020, King Coffee has collaborated with Vietnam Women’s Union to implement the project “Women Can Do,” aimed at women who need to do business themselves.

I promote women to be strong and brave enough to step out their own safety zones to learn how to do business and to actively manage their finances. The project not only helps the women’s family have a stable income, but also create more untapped resources for society.

Over the past 20 years, I have travelled to many countries around the world, attended many international seminars, met with friends and partners domestically and internationally. I have found that everyone praises Vietnamese women as beautiful and excellent. I hope the roles they have played will be recognized and affirmed in a worthy way in the society.

To inspire women to start a business and young people who want to start up with coffee, what do you want to share?

You must have a passion for it! Start-ups want to succeed, they must first have passion. Without intense passion, I would advise you not to get involved. Only with such a passion would you have the motivation that helps you surmount all obstacles in your way because the first step is the hardest.

From being a co-founder of Trung Nguyen trademark, bringing it to a number one Vietnamese brand from zero, building G7, and now King Coffee…, my only principle is to focus on making differences and avoid going the ways as others have done.

The second is the startup spirit. An entrepreneur with a startup spirit will do everything to achieve their goals based on law and prestige, from which, to gain success and go long term.

The coffee industry is an extremely challenging industry because you will encounter many major competitors. With our support, you will start up on the right track and can build up yourself thanks to being trained by a community of over 100,000 people.

Le Hoang Diep Thao touches on a branch of coffee in a supplied photo

During the COVID-19 pandemic, it is necessary to fly high to avoid storms

After a year of volatility due to the impact of the novel coronavirus (COVID-19) pandemic, did your coffee business and the coffee industry in general suffer losses? How do you predict the entire picture of the coffee industry next year?

The COVID-19 pandemic caused a huge shock to the market, causing disruption to the global supply chain. This is not only a substantial loss for people, but also for the world market.

It is great that we can even sit together here. This is something that I am extremely grateful for the Government and the State of Vietnam.

To my business activities, right from the beginning of the pandemic, I immediately thought about how to make the company fly higher, faster, and stronger to be able to avoid that storm. We used every measure for the business to accelerate.

After a year, despite many difficulties, the achieved business results are very well. At the international market alone, we have doubled our exports thanks to using a global network of agents, which take advantage of people’s spare time at home during social distancing periods to expand the international business network.

In the next five to 10 years, the world coffee market will have a shortage of supply, so Vietnam needs to take practical actions to quickly welcome new opportunities, such as replanting coffee trees, setting standards of the coffee industry, and building a better reputation in the world market. We will have an advantage in terms of output and achieve a greater value.

In addition, we also have the responsibility to facilitate the best development of specialty coffee, reaching the international level.

As a person with a wealth of experience as both co-founder of Trung Nguyen Group and head of TNI Corporation with King Coffee brand, how will you take steps to help improve the value of the coffee industry and Vietnamese brand?

Many other industries in the world have decreased both supply and demand, but the coffee industry has still increased around 2-4 percent per year. Particularly, the Vietnamese coffee industry in particular could enjoy a growth rate of around 9-10 percent per year.

Our country is an agricultural country and coffee is one of the strategic agricultural exports. But the value of the revenue is not high, only about $3 billion per year. Therefore, we need to promote the coffee industry to increase the value of revenue.

When it comes to Italy, people think of pizza, when it comes to Germany, we think of machines, techniques, when it comes to America, people think of fast-food brands. I hope that in the future, when it comes to Vietnam, people around the world will remember coffee. Vietnamese coffee is delicious, so Vietnam must have a world-class coffee brand.

Le Hoang Diep Thao (right) talks with a reporter in an interview in a supplied photo

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Vietnam’s sea ports have berthed some 4,900 foreign vessels over the last two months, a decline of 6 percent year-on-year, according to the Vietnam Marine Administration.

The fall was due largely to the impact of COVID-19, which is resulting in major fluctuations in the transport sector, a representative of the administration said.

Despite the lower number of foreign ships, the volume of import and export goods through ports grew. In January and February, 35.3 million tonnes of imports and 26 million tonnes of exports were handled at ports nationwide. The former represented an annual increase of 14 percent while the latter was as same as that last year.

In particular, nearly 1.3 million TEUs for exports and 1.2 million for imports were handled during the period, up 32 and 16 percent, respectively, year-on-year; the highest growth since the pandemic began.

Meanwhile, the arrival of domestic vessels totalled 5,300, up 11 percent year-on-year./.

Quang Ninh’s Van Don airport reopens on March 3

The Ministry of Transport has decided to allow Van Don International Airport in the northern province of Quang Ninh reopen from 6:01am on March 3 after the COVID-19 pandemic has been put under control in the locality and the airport is safe to transport passengers.

The airport was temporarily shut down from January 29 after an airport security staff was confirmed positive for the coronavirus SARS-CoV-2 that causes the COVID-19 pandemic.

The national flag carrier Vietnam Airlines announced earlier that it will resume flights between Ho Chi Minh City and Quang Ninh on March 3, thus becoming the first to restart flights to the Van Don airport since the local COVID-19 outbreak began.

From March 3 to 17, one weekly flight will ply the route between the two destinations, on Wednesdays. Flight numbers will be increased to three a week, on Wednesdays, Fridays, and Sundays, from March 18 until the end of the year.

Flights will take off at 1:00pm from HCM City and 3:45pm from Van Don.

Passengers on the first three flights after resumption will enjoy a discounted fair of 507,000 VND (22 USD), including taxes and fees, per leg./.

Webinar on Vietnamese market held in Switzerland

The Vietnamese Embassy in Switzerland, in collaboration with the Geneva Chamber of Commerce, Industry and Services and the Switzerland-Vietnam Business Group (SVBG), organized the Webinar Market Focus Vietnam on March 2.

This was also a chance for the newly-established SVBG to introduce itself to Swiss partners.

The webinar aimed at boosting trade and investment cooperation between Swiss and Vietnamese businesses.

Speaking at the event, Ambassador Le Linh Lan stressed that Vietnam and Switzerland have maintained good friendship and cooperation for half a century.

This year, the two are celebrating the 50th anniversary of their diplomatic ties.

Switzerland is the 6th largest European investor in Vietnam, with its investment totaling 2 billion USD, mostly in manufacturing – processing and electricity. Currently, around 100 Swiss firms are operating in Vietnam.

Meanwhile, Vietnam is the four biggest trade partner of Switzerland in ASEAN, with bilateral trade exceeding 3.6 billion USD in 2019. Since 2012, Vietnam and the European Free Trade Association (EFTA) – the intergovernmental organisation of Iceland, Liechtenstein, Norway and Switzerland – began negotiations for an FTA, which is expected to be signed this year./.

Vietnam, Austria shape up economic-trade cooperation

Vietnam and Austria discussed measures to promote economic-trade collaboration during a recent working session between Vietnamese Ambassador to Austria Le Dung and Austrian Deputy Minister for Digital and Economic Affairs Michael Esterl.

The Vietnamese diplomat thanked Michael Esterl and his ministry for boosting cooperation between the two sides, affirming the Memorandum of Understanding on Industry 4.0 cooperation clinched between the Vietnamese Ministry of Industry and Trade and the Austrian ministry provides a sound basis for both sides to carry out collaboration activities in the coming time.

Michael Esterl, for his part, laid stress on the significance of the regular policy and legal consultation between the Vietnamese Embassy and the Austrian ministry as it creates opportunities for both sides to exchange trade and investment policies and regulations as well as market information in each nation.

He suggested both sides maintain this mechanism in the forms that suit COVID-19 situation such as holding virtual conference.

The Vietnam-Austria business conference could be organised to update information and pen measures to support enterprises of both sides so that they can seek cooperation opportunities and expand investment in each country, he added.”

Touching on cooperation in the time to come, he said Austria is pushing procedures to ratify the EU-Vietnam Investment Protection Agreement (EVIPA).

Dung thanked Austria’s support, stressing Austrian businesses have many opportunities to land investment in Vietnam.

With a population of 97 million, Vietnam is a potential market for Austrian firms to expand their business operation, while it serves as a gateway for Austrian products and services to get access to the 670 million-strong ASEAN market.

Additionally, being a favourite destination for foreign investors in the “China, Plus One” strategy, Vietnam will have preferential policies to attract foreign investment, he said, holding when the EVIPA takes effect, Austrian companies will gain great competitive edges if they invest in Vietnam.

At the event, both sides reaffirmed they want to cooperate with each other in the fields of vocational training and labour. Austria said the country has huge demand for skilled workers in information technology (IT) and nursing in the future.

They also reached consensus on urging competent authorities to kick off a pilot project to carry out Austria’s vocational training model in Vietnam.

Dung took the occasion to invite Michael Esterl to visit Vietnam in a suitable time when the COVID-19 pandemic is put under control./.

Making greater efforts towards a year of economic growth

The Ministry of Planning and Investment has made a draft report on additional evaluation of the implementation of the socio-economic development plan in 2020 to collect comments from ministries, sectors and localities. The report’s latest data update shows that the implementation of many targets is better than the estimate reported to the National Assembly.

The highlight of 2020 was that Vietnam achieved and exceeded 10 out of the 12 main targets assigned by the National Assembly, up two targets compared to the estimate, including the targets on the growth rate of total export revenue and on the unemployment rate in urban areas.

This is an encouraging economic result amid the “COVID-19 period” because the pandemic caused dramatic declines on consumption worldwide, pushing production and export activities to stagnation and raising unemployment rate.

In addition, the implementation of four other goals has better performance than the estimates reported to the National Assembly, including the growth rate of gross domestic product (GDP), the average growth rate of consumer price index (CPI), trade surplus, and the percentage of population participating in health insurance.

Basically, the growth quality of the economy has been improved with less dependence on natural resource exploitation, raw exports, and cheap labour while gradually shifting to rely on application of science, technology and innovation, and the processing and manufacturing industry.

It can be said that Vietnam’s economy had a year of brave growth in both quantity and quality, which were not only kept stable but also growing.

This result has added a highlight to the economic picture of Vietnam in such a difficult year while reinforcing the confidence of the whole society in the Government’s policy and governance in the context unpredictable developments of the COVID-19 pandemic.

However, with GDP growth rate of 2.91% in 2020, Vietnam’s economy had the lowest growth year in the past ten years and failed to meet the target set for the 2016 – 2020 period.

This is a big challenge in the starting year of the implementation of the 5-year socio-economic development plan in the 2021 – 2025 period and the ten-year strategy in the 2021 – 2030 period.

To continue with another year of brave growth, right from the beginning of 2021, the entire political system has made every effort to drastically restrain the third wave of the COVID-19 pandemic while continuing to promote production and business activities towards the annual growth target of 6.5%.

At the beginning of the year, the Ministry of Finance asked the Government to develop a decree to extend the deadlines for tax payment and land rent for enterprises in the context of prolonged COVID-19 epidemic with an estimated value of about VND115 trillion.

Amid the increasingly unpredictable global political and economic situations and difficulties in making forecasts due to the impact of the pandemic, more than ever, “rewards” will be given to the economies which early and flexibly take response activities.

Travelling to nearby, safe destinations: the main tourism trend in Vietnam in 2021

In 2021, domestic tourism is still the development focus of the sector; meanwhile, famous seas and islands and tourist cities continue to be leading destinations and are predicted to continue to be popular destinations for Vietnamese tourists.

Before COVID-19, exploring a crowded city, strolling through bustling markets, enjoying dinner at a bistro brimming with locals, or touring major attractions were Vietnamese tourists’ favourite activities. However, as the epidemic has still been fully resolved, tourists are now giving their top priority to their safety in the new situation.

Therefore, socially distant travel is expected to be the trend once again in 2021. Travelers will select sparsely populated areas nearby so that they can set plans and tours that align with their travel demands and ensure protection from the pandemic.

Vietnamese tourists often spend 2-3 days, especially weekends or short holidays, travelling to domestic destinations. This year once again, they will choose destinations that are easy to move and near their cities they live.

Coastal and island destinations are still the Vietnamese tourists’ favourite, with Vung Tau and Nha Trang emerging as popular destinations for domestic tourists. In addition, other famous tourist sites such as Ha Long, Sapa, Phu Quoc and Da Lat will attract a large number of visitors.

If socially distant travel is how independent travelers will adapt to the new situation, small group travel is the choice for people who want to travel as a group and adapt to the current situation.

Different from regular trips in 2019 that could accommodate 20 – 30 visitors, sizes have shrunk down to control the spread of infectious diseases.

According to Outbox Consulting, the COVID-19 pandemic will make wellness travel an emerging trend this year. Wellness travel is not a new trend in the tourism industry; however, during the pandemic, fatigue and stress have become familiar to almost everyone. So, after the pandemic is controlled, visitors will find wellness retreats useful after a long period of repressed travel demand.

Vietnam was considered an emerging destination in the wellness travel trend in the Asian Pacific region in 2019. This, combined with an increase in visitors’ demands for wellness travel trends in 2021 will present an opportunity for Vietnam’s wellness tourism market, especially as Vietnam is emerging as a safe destination in terms of controlling the pandemic.

Another feature that has emerged during the outbreak of COVID-19 pandemic is that visitors tend to book accommodation at the last minute because they they perceive it may be harder to cancel and get a refund for hotel bookings as opposed to flight tickets.

Pre-COVID, Vietnamese travelers often planned their trip and booked services long before their departure, especially when it came to overseas tours, in order to save money. However, in the face of the complicated developments of COVID-19, shorter booking timeframes will help mitigate the risk of travel policy changes and mobility restrictions.

The use of technology in tourism has long been popular across the world and in Vietnam in recent years. The COVID-19 pandemic sped up this digital transformation in 2020.

This year, technology will be a leading factor helping visitors regain their confidence. A survey conducted by Censuswide tshowed more than 4 out of 5 travelers said that technology would increase their confidence to travel in the next 12 months. They noted that a mobile app that provides warnings and updates during trips, for example local outbreaks or the government’s latest guidelines, will be essential this year.

In addition, contactless payments (for example, Apple, Google Pay, PayPal, and Venmo) will help tourists travel more confidently within next 12 months. In 2021, safety will be of paramount importance, and simple technological solutions will be the driving force for travelers to explore the world more confidently. Vietnamese tourists are part of the general global technological .

Commenting on the roadmap for the recovery of Vietnam’s tourism, the Outbox Consulting report said it will depend on foreign countries’ ability to control the epidemic. Beside vaccines, the speed of tourism’s recovery depends partly on factors that boost destinations reopening timeframes.

China represents largest import market of Vietnam over two-month period

China made up the nation’s largest import market during the first two months of the year with an estimated turnover of US$17.3 billion, representing a year-on-year increase of 85.7%, according to data recently released by the General Statistics Office of Vietnam (GSO).

Throughout the reviewed period, import turnover stood at an estimated US$47.26 billion, an increase of 25.9% over last year’s corresponding period, of which the domestic economic sector reached US$15.62 billion, a boost of 16%, with the foreign-invested sector rising to US$31.64 billion, a surge of 31.4%.

Most notably, there were 11 commodities in total which recorded an import turnover of over U$1 billion, accounting for 67.6% of the country’s total import turnover, while nine items had an export turnover of over US$1 billion, making up 73.8% of the overall export turnover.

With regards to export markets, the US was the largest Vietnamese export market during the two-month period with a turnover of US$14.2 billion, posting a rise of 38.2% on-year.

Businesses urged to change mindset to overcome COVID-19 challenges

Amid complicated developments by the COVID-19 pandemic, local textile and apparel firms have been forced to change their business mindset, boost connectivity, expand into new markets, and maximise the benefits from free trade agreements (FTAs) to meet this year’s export target of US$39 billion, according to insiders.

Despite challenges caused by COVID-19, Vietnam raked in approximately US$2.6 billion from garment and textile exports  in January, representing a year-on-year increase of 3.3%, with some products recording high growth rates of between 9.3% and 35.6%.

Nguyen Xuan Duong, chairman of the Board of Directors of Hung Yen Garment Corporation (Hugaco), said that domestic textile businesses are anticipated to encounter numerous difficulties moving forward due to a shortage of export orders and cash flow, thereby making it tough to maintain production activities whilst ensuring the jobs of workers.

Le Tien Truong, chairman of the Vietnam National Textile and Garment Group (Vinatex), said that outsourcing costs will decrease significantly due to the trend of simple goods being replaced by fashion products this year, adding that firms should be flexible in altering their business strategies in order to adapt to market fluctuations and seize upon new opportunities.

Than Duc Viet, general director of Garment Corporation 10, revealed that the cancellation of export orders due to the COVID-19 pandemic has made the company draw up a number of fresh strategies aimed at increasing its competitive advantages.

In line with this, the business has turned to export fabric and medical masks, protective suits, knitwear, as well as small orders that have a high value and short production period.

Viet stated that the group will focus on surveying the market, whilst selecting suitable export products, enhancing workers’ skills, and increasing labour productivity in an effort to boost exports in the near future.

Tran Nhu Tung, vice chairman of the Board of Directors of Thanh Cong Textile Garment Investment Trading JSC, said the company has received a sufficient amount of orders until the end of the first quarter, with the prospect of new orders ahead during the year’s second quarter.

Tung also revealed that the company has initiated plans to begin construction of another factory in Hoa Phu Industrial Park in the southern province of Vinh Long with an estimated capacity of 12 million products annually, with estimated revenue from the EU market set to see a double-digit increase.

With a complete production procedure from yarn, weaving, dyeing, and sewing, the group is anticipated to enjoy preferential tariffs in line with the EU-Vietnam Free Trade Agreement (EVFTA) and Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) regulations.

Land brokers rush to Binh Phuoc although airport project still being mooted

Although an airport project has only been proposed in Hon Quan District of Binh Phuoc Province and is still being considered by the competent agencies, a large number of land brokers have rushed to the district and inflated the prices of land lots in surrounding areas.

Over the last week, land brokers from HCMC, Hanoi and the neighboring localities of Binh Phuoc flocked to Hon Quan. Besides posting advertisements on social networks, they also took land buyers to visit the site proposed for the development of the airport, the local media reported.

They have advertised land lots measuring some 1,000 square meters each and put up them for sale at VND700-900 million each. They have also said that only a small number of people could buy the land.

According to the Hon Quan District government, the land price inflation and large gatherings of people are abnormal, posing a high risk of social disorder and Covid-19 infection.

The land price inflation may encourage local residents, especially the ethnic minority people, to sell agricultural land. Therefore, the competent agencies have been educating residents so that they are not tricked by land brokers who spread false information.

Due to the complicated situation, on February 26, the government of Hon Quan District asked the police and military forces to support communes in the district to handle large gatherings and those without face masks to prevent the Covid-19 infection, especially in the surrounding areas of the proposed airport site.

The authorities of communes and towns, especially Tan Loi and An Khuong communes, were asked to enhance the construction and land use management to promptly prevent illegal projects, the improper use of land and land violations and impose sanctions on violators.

The Binh Phuoc government had earlier proposed the Government and the Ministries of National Defense and Transport allow the province to manage the existing 100-hectare airport in the province to develop it into an airport that can be used for both civil and military purposes with an area of 400-500 hectares. The land for the airport expansion is public land and the expansion project was proposed to be executed under the public-private-partnership format.

Over 33,600 firms dissolve, suspend operations in Jan-Feb

The country saw over 33,600 firms leave the market or suspend their operations in the first two months of the year, up 18.6% year-on-year, according to the Ministry of Planning and Investment.

Of the total, over 21,630 companies signed up to temporarily suspend operations, some 8,380 halted operations to complete dissolution procedures and over 3,590 were dissolved.

The number of newly-established firms in February dropped by 12.3% year-on-year at 8,040, while pledged capital surged by 85.6% at VND179.7 trillion. Besides, some 7,700 firms left the market in February, VietnamPlus news site reported.

Between January and February, some 18,130 companies were established, inching down 4% year-on-year, while the number of firms returning to the market, mainly active in the art, entertainment and education fields, and lodging and catering services, during the two-month period was 11,030, down 7.6% against the same period last year. However, the total registered capital increased by 12% to VND720.4 trillion.

TGE to invest in wind power project in Mekong Delta

Gia Lai Electricity JSC (GEC) has passed a plan to invest in the Tan Phu Dong 2 wind power project in Tan Thanh Commune, Go Cong Dong District, Tien Giang Province.

The subsidiary of Thanh Thanh Cong Group authorized Tien Giang Wind Power JSC (TGE) to implement the 50-MW plant project, reported Bnews news site.

TGE will set up the project’s management board to monitor and execute the project. Further, it is in charge of building a power transmission line for the project; seeking, negotiating and selecting appropriate consulting firms, equipment suppliers and construction units in line with prevailing regulations and ensuring the project proves financially effective.

Besides this, GEC authorized its general director to decide, sign and implement essential procedures to ensure the project will be put into commercial operation as scheduled in the approved plan.

Earlier, GEC had passed a plan to contribute nearly VND10 billion worth of capital to TGE.

Manufacturing output returns to growth in February

The health of the sector has now strengthened in three successive months.

The Vietnam Manufacturing Purchasing Managers’ Index (PMI) ticked up to 51.6 in February from 51.3 in January, signaling a modest improvement in business conditions, according to Nikkei and IHS Markit.

The health of the sector has now strengthened in three successive months. A reading below the 50 neutral mark indicates no change from the previous month, while a reading below 50 indicates contractions and above 50 points to an expansion.

Sustained growth of new orders was recorded, helping to drive the improvement in overall business conditions. New work has now increased in six successive months. Total new orders were supported by a return to growth of new export business amid some signs of improving international demand.

Rising new orders was the main factor behind a return to growth of manufacturing production. The slight increase was also partly attributed to efforts to build stocks of finished goods. These efforts were successful in bringing an end to a four-month sequence of falling post-production inventories.

Employment increased for the second time in three months as firms responded to rises in demand and production requirements. This enhanced capacity meant that firms were able to keep on top of workloads and reduced outstanding business again.

A renewed expansion of buying activity was also recorded, but stocks of purchases continued to fall amid the use of inputs to support production.

Problems securing raw materials also contributed to falling stocks of purchases. Suppliers’ delivery times lengthened sharply again. Difficulties sourcing goods from abroad due to a lack of shipping containers and global demand for materials outpacing supply continued to cause longer lead times.

These imbalances led to a further sharp increase in input costs in February. Although the rate of inflation eased to a three-month low, the rise in input prices was still faster than the average seen across the ten-year survey so far.

Manufacturers responded to higher input costs by raising their own selling prices accordingly. That said, the rate of inflation was modest and the slowest since last November.

Business confidence continued to wane in February, dropping for the third month running to the lowest since August 2020. Sentiment was hit by concerns over the ongoing impact of the Covid-19 pandemic. That said, firms remained optimistic on balance, with hopes that the pandemic will be brought under control over the coming year supporting confidence.

“Renewed increases in output, employment and purchasing activity are all welcome signs, but a recent increase in Covid-19 cases sounds a note of caution. In fact, confidence among firms slumped to the lowest since August 2020, the last time a significant outbreak of the pandemic was seen,” said Andrew Harker, associate director at IHS Markit, which compiles the survey.

“Previously, Vietnam has proved successful in quickly suppressing the virus, and should this be the case again we will hopefully see the manufacturing sector remain in growth territory. IHS Markit currently forecasts a rise in industrial production of 6.8% this year.”

What makes Phu Quoc’s real estate attractive to investors?

Population in Phu Quoc likely triples in 2030, resulting high demand for hospitality industry.

The administration upgrading has made Phu Quoc the first island city in Vietnam, opening up an era for the locality equal in size to Singapore.

The move is considered a momentum for the island that is well-known for tourism, creating favorable conditions for the mushrooming of real estate projects, local experts have predicted.

It triggers a question on how Phu Quoc’s real estate attractive to investors. The expertise might offer a broader view of the potential there.

Dang Phuong Hang, managing director, CBRE Vietnam, said that real estate ecosystem models like hospitality will match the tourism-based island.

The development of tourism will support the growth of three-pillar model namely hospitality real estate, entertainment, and high-end housing segment, she added.

Phu Quoc’s real estate sector has significant room to grow thanks to youngling market, plenty of investment opportunities, and reasonable prices. In addition, well-equipped resort projects are expected to drive up the service prices.

Enormous potential for real estate market is obviously seen in newly-established wards like Duong Dong and An Thoi, Hang said.

“The city status will enable Phu Quoc to make master growth planning, including strategies for tourism industry. The city’s population is forecast to triple by 2030, forming elite groups that demand high-end services,” Hang said.

Nguyen Van Dinh, deputy general secretary of the Vietnam Real Estate Association (VNREA), said the three-pillar ecosystem [hospitality real estate/resort – entertainment – high-end housing segment] is the most suitable model for the island tourism city of Phu Quoc.

Notably, the well-invested infrastructure and more convenient transport have fueled the increasing flows of tourists to the island. So far, visitors go to Phu Quoc by high-speed craft with 150-300 passengers on board each and by airplane with 15-20 flights from various part of the country per day.

According to Dr Nguyen Tri Hieu, meanwhile, the upgrading to city has enabled Phu Quoc to have more budget for infrastructure and more open policies.

The local People’s Council has approved a public investment plan worth VND17 trillion (US$739 million) for 2021-25, including infrastructure, key projects, and resettlement models.

In 2020, as many as 20 out of 23 investment projects in Kien Giang Province were committed to going to Phu Quoc. The island welcomed nearly three million visitors in the same year despite Covid-19, up 60% on-year.

Relaxed policies and nature-favored living conditions help support investors’ expansion plans. The city is likely to attract additional 18,000 people by 2030, including high-skilled workers, foreign experts, and overseas Vietnamese.

The figure might be higher thanks to visa exemption scheme (up to 30 days) from July 2020 to foreigners and a stay of up to 10 years for foreign investors having at least VND100 billion (US$4.4 million).

Outlook

Nguyen Manh Ha, deputy head of VNREA, believed that real estate prices in Phu Quoc will set up a new level in a short time, unlike Nha Trang and Danang before. It will take several years to record VND500-600 million (US$21,739-US$26,000) per square meter in some places in Phu Quoc like the rate in Nha Trang currently.

However, it requires a well-prepared planning for the island city, Ha noted.

The island’s southern region is of high expectations with more investment flows in the next five years, local experts predicted.

Islands in southern Phu Quoc, if given well-designed planning, are expected to be destination of wealth-off people in the coming years, according to Dr Le Xuan Nghia, former deputy chairman of the National Financial Supervision Committee.

There remains much to say about procedures and investors need to pay more attention to legality of projects and segments they are investing in, local experts have warned, adding that Phu Quoc’s real estate must be viewed in long-term strategies with possible focus on cleared land and resort projects.

Vietnam named in Agility’s top 10 Emerging Markets Logistics Index 2021

Vietnam’s rise of three ranking positions to 8th overall is the fastest rise in the top half of the Index and displaces regional partner Thailand in the top 10.

Vietnam moved up three places to 8th in the top 10 countries of the Emerging Markets Logistics Index 2021 by Agility, one of the world’s top freight forwarding and contract logistics providers.

Among countries in ASEAN, Vietnam stood at third behind Indonesia (3rd overall) and Malaysia (5th), and was above the likes of Thailand (11th), the Philippines (21st) and Cambodia (41st).

According to Agility, Vietnam’s handling of the Covid-19 pandemic has been one of the most successful globally, with data from Johns Hopkins University showing less than 1,500 reports of Covid-19 cases in the country in 2020.

The combination of social and economic restrictions with a strict and comprehensive testing and tracing system, saw lockdowns last less than three months, and by June many factories were reopened and domestic operations were recovering quickly, it said.

“The steps taken by Vietnam in 2020 propel it into the top 10 ranking in 2021 – its rise of three ranking positions to 8th overall is the fastest rise in the top half of the Index and displaces regional partner Thailand in the top 10,” stated the logistics firm.

“The country’s economy has performed well as a result of the minimal domestic disruptions and is set to be one of the best performing globally in 2020,” noted the report.

The foundation provided by the strong performance in 2020 is expected to underpin a 2021 expansion of 6.5% as domestic and international conditions normalize and the Covid-19 pandemic recedes.

In recent years, Vietnam has added significant hightech manufacturing capacity, helping attract investment from producers higher up the value chain as costs in China increased.

The option to avoid additional costs associated with the US-China trade war has added further motivation for manufacturers to choose Vietnam, noted Agility.

Samsung, which alone contributes a quarter of Vietnam’s exports through smartphone manufacturing activity in the country, will shift PC manufacturing to Vietnam after it shut down a Chinese factory in 2020. Apple is also reported to have requested that Foxconn open a Vietnam production location to add production capacity for iPads and MacBooks.

When the production lines become active in the first half of 2021, it will be the first time iPad manufacture to take place outside China. Meanwhile, chip manufacturer Intel will operate its largest assembly plant in the country and South Korea’s LG electronics announced investment plans during 2020.

With Covid-19 further exposing the risks of over-reliance on China, Vietnam will be an attractive option for relocation – indeed, when asked, 19.2% of survey respondents cited Vietnam as the number one location for those seeking to diversify production locations outside of China.

However, so rapid has the investment and arrival of new businesses been that it is creating challenges of its own, including a shortage of skills and knowledge to produce the highest value goods.

Navigos Group, which owns the country’s largest jobs site, reports that 71% of employers cite a lack of IT skills as their most significant challenge.

By 2025, the country set the contribution rate target for logistics to be at 5-6% of GDP, services growth rate between 15-20%, while the rate for logistics outsourcing to be 50-60%, said the government’s decision No.200 referring to an action plan to enhance the competitiveness and development of Vietnam’s logistics sector through 2025 and ensure its ran in the Logistics Performance Index of at least 50th.

Giants to invest in big projects in Hue

Aeon, a Japanese-based retailer, and Vietravel, a local tourism company, are building commercial and service centers in the central province of Thua Thien Hue.

Aeon Vietnam Co., the investor of the Aeon Mall chain in Vietnam, plans to pour US$150-160 million into a large-scale shopping mall in Hue City, Thua Thien Hue Province.

This was unveiled at the signing ceremony of a memorandum of understanding about the investment research of Aeon Mall in Hue City between the Thua Thien Hue People’s Committee and Aeon Mall Vietnam.

Phan Ngoc Tho, Chairman of Thua Thien Hue Provincial People’s Committee, said the province will strongly support the investor to do studies as well as procedures so that the latter could commence the project this year.

Tho also said apart from the commercial center, the investor was also interested in developing local raw material areas.

Meanwhile, Vietravel is building the Vietravel entertainment and service complex in Hue City. The VND140-billion project will provide a chain of travel services and auxiliary services when it comes into operation by the end of 2021.

In another development, Hue is calling for investment in a complex of hotel, commercial center, floating restaurant and tourist wharf at 121 Nguyen Sinh Cung Street, Hue City with an aim to attract tourists to visit the famous Huong River.

Late last year, the People’s Council of Thua Thien Hue Province approved the socio-economic development plan for 2021, including a list of key projects in 2021.

Some major projects will be kicked off in 2021 such as the international golf project plus the auxiliary service area and resort by ​​BRG Golf Course Joint Stock Company with a total investment capital of VND3,164 and VND1,656-billion Vinh My tourist service area by ​​Heritage Vietnam Real Estate Co.

HCM City’s export turnover surges 25.1 pct. in first 2 months

Ho Chi Minh City exported 8 billion USD worth of goods during the first two months of 2021, according to the municipal Department of Statistics, a 25.1 percent increase year-on-year.

Excluding crude oil, export turnover stood at over 7.6 billion USD in the period, a rise of 26.5 percent compared to the same period last year.

The export value of wood and wooden products posted the highest growth, surging 60.4 percent year-on-year to 224.6 million USD.

China remained the southern city’s biggest buyer, with revenue totalling nearly 1.8 billion USD, a year-on-year increase of 31.6 percent and accounting for 23.2 percent of its export value.

It was followed by the US with 1.2 billion USD, up 15.1 percent.

Local enterprises spent 10.92 billion USD on importing goods in the period, up 53 percent year-on-year./.

Hanoi’s February consumer price index up 1.8 percent

The consumer price index (CPI) in the capital city grew up 1.8 percent in February from the previous month, according to the Hanoi Statistics Office.

Ten out of 11 groups of products and services in the CPI basket recorded higher prices. The group of housing, electricity, water and construction materials posted the highest price increase of 6.02 percent, mostly due to rises in the costs of electricity, gas, and construction services.

The prices of restaurant and catering services jumped 1.44 percent thanks to high consumption demand for the Lunar New Year festival – the biggest traditional festival of Vietnamese people.

Moving in the upward trend were groups of transport (1.24 percent); beverage and tobacco (0.77 percent); apparel, headwear, and footwear (0.06 percent); household equipment (0.04 percent); and other goods and services (0.11 percent). The two groups of medicine and medical services, and education both grew by 0.01 percent.

The postal and telecoms services group was the only one recording a price decline of 0.01 percent.

The Statistics Office also said that the gold price went down by 0.56 percent, while the price of US dollar dropped by 0.27 percent as compared to January./.

Aquatic exports rise 2.2 percent in two months

Export value of aquatic products reached 405 million USD in February, pushing the figure in the first two months of 2021 to over 1 billion USD, up 2.2 percent over the same period last year, reported the Vietnam Association of Seafood Exporters and Producers (VASEP).

According to the association, exports of tra fish saw positive signals since the beginning of this year after consecutive drops in 2020, with a 1.7 percent rise in the first two months of 2021 to 214 million USD.

Meanwhile, shrimp export in February was estimated at 160 million USD, down 18 percent year on year, resulting in over 380 million USD in the first two months of 2021, a slight annual fall of 0.8 percent.

At the same time, seafood exports rose 31.4 percent to 264 million USD in January but dropped 21 percent to 156 million USD in February, resulting in the two-month export value of 420 million USD, up 5.5 percent.

The VASEP said that in the first two months of this year, exports of Vietnamese aquatic products were affected by demands of markets amidst COVID-19 pandemic.

The association forecast that aquatic export value in March will reach about 640 million USD, up 1.5 percent over the same period last year thanks to high demand in the US, EU and members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP)./.

Vietjet offers free baggage allowance on domestic routes

The budget carrier Vietjet Air has offered free 20kg of checked baggage for passengers on its entire flight network across Vietnam.

Accordingly, from February 27 to March 31, 2021, passengers buying tickets and flying with Vietjet across Vietnam will receive the special gift of 20kg checked baggage in addition with 7kg hand luggage completely for free.

The special offer is for passengers booking tickets at least 3 hours before departure time on Vietjet’s official sales channels at www.vietjetair.com, official Facebook page at https://www.facebook.com/vietjetvietnam/, ticket offices and official agents, applying for all payment methods. The free checked baggage is immediately applied as customers choose to include a 20kg baggage package when booking on all domestic flight routes with the flight time from February 27, 2021 to April 25, 2021.

Especially, passengers do not miss opportunities to fly and experience the new super convenient Deluxe fare type of Vietjet at an unprecedented attractive price from only 399,000 VND (17.25 USD). In addition to the 20kg checked luggage for free, Deluxe passengers can enjoy free changes of flight, date, route for unlimited times; free priority check-in; free seat selection; and included Deluxe Flight Care programme.

Government gives in principle approval to industrial park projects

The Government has given the green light to a number of industrial park projects in the central province of Nghe An and the northern provinces of Nam Dinh and Vinh Phuc.

The Hoang Mai 1 Industrial Park project in Hoang Mai township in Nghe An received in principle approval under Decision No 276/QD-TTg and will have a duration of of 50 years.

Located in the Southeast Nghe An Economic Zone, the project covers 264.77 ha and has total investment of 750 billion VND (32.4 million USD).

In other decisions, Prime Minister Nguyen Xuan Phuc approved in principle the construction and trading of infrastructure at the My Thuan Industrial Park in My Loc and Vu Ban districts in Nam Dinh and the Thai Hoa-Lien Son-Lien Hoa Industrial Park (first phase) in Lap Thanh district in Vinh Phuc.

My Thuan will cover 158.48 ha and have total investment of over 1.6 trillion VND (69.19 million USD), while Thai Hoa-Lien Son-Lien Hoa will sit on 145.27 ha and have total capital of 774.82 billion VND (33.5 million USD)./.

Hanoi’s February consumer price index up 1.8 percent

The consumer price index (CPI) in the capital city grew up 1.8 percent in February from the previous month, according to the Hanoi Statistics Office.

Ten out of 11 groups of products and services in the CPI basket recorded higher prices. The group of housing, electricity, water and construction materials posted the highest price increase of 6.02 percent, mostly due to rises in the costs of electricity, gas, and construction services.

The prices of restaurant and catering services jumped 1.44 percent thanks to high consumption demand for the Lunar New Year festival – the biggest traditional festival of Vietnamese people.

Moving in the upward trend were groups of transport (1.24 percent); beverage and tobacco (0.77 percent); apparel, headwear, and footwear (0.06 percent); household equipment (0.04 percent); and other goods and services (0.11 percent). The two groups of medicine and medical services, and education both grew by 0.01 percent.

The postal and telecoms services group was the only one recording a price decline of 0.01 percent.

The Statistics Office also said that the gold price went down by 0.56 percent, while the price of US dollar dropped by 0.27 percent as compared to January./.

HCMC helps real estate firms to ride out difficulties

HCMC leaders, including the city’s Chairman Nguyen Thanh Phong, Vice Chairman Le Hoa Binh and heads of departments, held a meeting with 16 real estate firms on February 27 to help them ride out their difficulties.

Deputy director of the HCMC Department of Construction Huynh Thanh Khiet said the real estate supply in 2020 dropped 34% year-on-year. As investors have focused more on the up-market segment, the proportion of newly developed luxury apartments and medium apartments jumped from 25% to over 41% and from 23.8% to 57%, respectively. Meanwhile, that of budget apartments dropped from 51% to 1%.

A representative of Novaland Group said some of the group’s projects are facing difficulties related to construction permits, house ownership certificates or legal procedures of the Thu Thiem new urban area.

“We hope that the Government and leaders of the city and departments will help us promptly resolve problems, enabling us to speed up our projects. This will help provide more products for the real estate market, meet the demand of the citizens, improve social security and contribute to the state’s budget,” he said.

Le Huu Nghia, director of Le Thanh Real Estate Company, said his company’s social housing projects have faced difficulties related to the legal procedures and tax policies. The time set for completing social housing project procedures has been shortened from between three and five years to 11 months but poor coordination between departments and districts may lengthen the process.

A representative of Thao Dien Real Estate JSC said the company has completed all procedures required by the relevant agencies. However, the land has not been handed over to the company to build a social housing project over the past 10 years.

Addressing the meeting, chairman of the HCMC Real Estate Association Le Hoang Chau suggested reducing investment license procedures to only four steps to save time and costs for businesses.

HCMC Chairman Nguyen Thanh Phong assigned the city’s Vice Chairman Le Hoa Binh with working with departments to help real estate firms resolve problems related to investment certificates, tax policies and house ownership certificates.

“The city will try to help 61 projects that are struggling to resolve their problems before April 15,” Phong stressed.

Going forward, the city will regard planning as a tool for construction management. The city will support the Department of Planning and Architecture and hire foreign experts to ensure proper planning.

According to Phong, the real estate sector contributes 8.2% to the city’s total revenues. Helping real estate businesses ride out difficulties is therefore vital for the city’s development.

Source: VNA/VNS/VOV/VIR/SGT/Nhan Dan/Hanoitimes