Vietnam automobile manufacturers association

Vietnam manufacturing index inches up

March 2, 2021 by e.vnexpress.net

The index, which represents an improvement from the previous month if it rises above 50, has now strengthened for three successive months, according to a note by market research company IHS Markit.

There has been sustained growth in new orders for six straight months amid signs of improving international demand, the report said.

Employment increased for the second time in three months as firms responded to rises in demand and production requirements, it added.

Factories in some provinces like Binh Duong and Dong Nai in the south and Bac Giang in the north are struggling as they need thousands of new workers following a surge in new orders.

Yet IHS Markit’s data showed that business confidence continued to wane in February, the third straight month it fell and at the lowest level since last August, after 865 new Covid-19 cases were found following the latest outbreak on January 28.

“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,” Andrew Harker, the company’s economics director, said.

Vietnam has in the past proved successful in quickly containing the virus, and if this success is repeated the manufacturing sector would remain in growth territory, he added.

IHS Markit forecasts a rise in industrial production of 6.8 percent this year.

Car prices in Vietnam set to be cheaper

March 2, 2021 by hanoitimes.vn

The Hanoitimes – With the Covid-19 impacts still looming on local economy, domestic car prices have gone down but remained nearly double the prices of vehicles sold in Thailand and Indonesia, mainly due to high fees and taxes for locally made cars.

Rising domestic production capacity and existing government’s support policies to cut fees and taxes for locally made cars are expected to be major factors dragging down car prices in Vietnam in the coming time.

Car production at Hyundai Thanh Cong manufacturing plant. Photo: Hoang Giang

A representative from the Truong Hai Auto Corporation (Thaco), one of Vietnam’s leading car manufacturers, expected the country’s participation in free trade agreements (FTAs) with major partners, including the EU, Japan, UK and South Korea, would help further abate costs for importing car parts with import duty at 0%.

With the Covid-19 impacts still looming on local economy, domestic car prices have gone down but remain nearly double the prices of vehicles sold in Thailand and Indonesia, mainly due to high fees and taxes for locally made cars.

“High product quality and low base cost are essential for Vietnam cars to compete with their foreign peers,” said auto expert Nguyen Minh Dong, adding only a bigger market size could attract more investors to come in to produce cars in the country and enhance localization rate.

Director of Hien Toyota noted while car manufacturers can streamline operation to drive down the production cost, taxes and fees are dependent on state policies.

“Lowering taxes and fees for cars will no doubt reduce prices and bring more benefits for customers,” she said.

Booming market demand

A recent report from the SSI Securities Corporation suggested Vietnam’s income per capita is on the rise and set to grow at an average of 8-10% in the next decade.

“Compared to regional countries, the current income per capita is fast approaching to a point of bursting demand for cars,” asserted the SSI, adding cars would soon move from the luxury category with a passenger vehicle density of 34 per 1,000 to a more ordinary one with a density level comparable to countries in the region.

The SSI also pointed to a key factor that the domestic car market is big enough for car manufacturers to shift from importing cars to assembling/manufacturing domestically.

At present, six major car manufacturers of Thaco, Huyndai, Toyota, Mitsubishi, Ford and Honda account for 90% of the market share in Vietnam with a combined production capacity of 30,000-60,000 units per year, exceeding the break-even point for domestically-produced cars of 30,000-40,000 cars per year for an assembling plant, or 10,000-20,000 units for each car model.

According to the SSI, domestic car production capacity is increasing rapidly to meet customers demand, a key step to lower car prices.

With more cars manufacturing and assembling plants scheduled to complete in the 2022-23 period, the SSI expects a heating up car markets with steep discount policies would drive up domestic car demands.

Along with existing Vietnam’s support policies for the automobile industry, the National Assembly is currently discussing a possibility of reducing the excise tax rate for locally made cars, in which the specific reduced rate would be in line with the localization rate, aiming to boost sales of affordable car models.

Four leading experts join treatment of critical Covid-19 patients in Vietnam

August 14, 2020 by hanoitimes.vn

The Hanoitimes – The four leading Vietnam physicians have been to the two hospitals that are currently treating some serious Covid-19 patients.

Four leading medical professionals of Vietnam were sent to Hue Central Hospital and Quang Nam General Hospital on August 13 to reinforce the frontline contingent of doctors in treating serious Covid-19 patients, Tuoi Tre online reported, citing Acting Minister of Health Nguyen Thanh Long.

Acting Minister of Health Nguyen Thanh Long speaks at an online meeting on Covid-19 prevention. Photo: Thuy Anh

The professionals are Dr. Nguyen Gia Binh, president of Vietnam Association for Emergency Resuscitation and Poison Control; Dr. Nguyen Van Kinh, president of Vietnam Infectious Association; Dr. Nguyen Lan Hieu, director of Hanoi University Medical Hospital; and Dr. Ngo Quy Chau, president of the Vietnam Respiratory Association.

As reported by the Covid-19 treatment subcommittee, the two hospitals are currently treating some Covid-19 patients who are in critical condition and at high risk of fatality.

Acting Minister of Health Nguyen Thanh Long also confirmed that his ministry has fully met the needs of medical equipment, drugs and supplies for treating Covid-19 patients in the two above-mentioned hospitals. The ministry will continue to provide ventilators and telemedicine devices for remote treatment and consultation in Quang Nam General Hospital.

The acting minister acknowledged the great efforts of all health workers in the two hospitals to treat Covid-19 patients.

On behalf of the Ministry of Health, the minister announced the donation of VND1 billion (US$43,040) to each hospital for supporting daily activities of health workers.

Mr. Long also asked the two hospitals to make efforts to minimize Covid-19 fatalities.

At the time of writing, Vietnam had reported 911 Covid-19 cases, of which 425 have recovered and been discharged from hospital, and 21 deaths.

Made-in-Vietnam satellite to be launched into orbit this September

March 2, 2021 by vov.vn

Dr. Le Xuan Huy, deputy director general of the Vietnam National Space Centre (VNSC), says the satellite, which weighs approximately four kg, has been completely researched and manufactured by VNSC engineers. Indeed, local workers have completed the project through its design phase to its installation, including the mechanical structure and power distribution circuit.

In the near future, NanoDragon will be sent to Japan’s Kyushu Institute of Technology in order to undergo further tests in a simulating environment. Following the completion of these tests, the satellite is due to be returned to Vietnam before being launched by the Japanese Epsilon missile in September.

Dr. Huy notes that the micro satellite is anticipated to operate in solar synchronous orbit (SSO) at an altitude of roughly 520 km. Its main task will be to integrate an Automatic Identification System (AIS) used for the purpose of tracking and monitoring vessels at sea. In addition, it will make use of an optical imaging device in order to verify the quality of the satellite posture controller while operating in orbit.

At present, engineers from the VNSC are putting the finishing touches to installing the ground station which will operate the satellite following its launch.

The VNSC is a pioneer agency in the country that researches and develops modern space technologies that aim to support economic development and environmental protection locally.

In addition to NanoDragon, it previously researched and manufactured the PicoDragon satellite which weighs one kg, along with the MicroDragon satellite which weighs 50kg, both of which proved to be highly-successful projects.

Vietnam is one of the countries in the world to be most affected by global warming and climate change. Space services and technologies will help the nation to gain a better understanding of climate change whilst supporting the process of monitoring and prevention of natural disasters, thereby contributing to mitigating their consequences.

Health crisis fails to impede business confidence

March 2, 2021 by en.nhandan.org.vn

In June last year, Ngo Dinh Vuong halted the operation of his garment factory in Quang Minh Industrial Park in Hanoi’s Dong Anh District due to the health crisis. The factory was opened in late 2018 and is the third to have been opened by Vuong in the northern region of the country since 2016.

Then in July, the second factory, based in Hung Yen Province, faced the same plight, leaving the first factory operating moderately also in Hung Yen. The three factories are managed by Hoang Yen Garment and Trading JSC, established in 2016, where Vuong is the director.

However, in early January, the two factories with halted operations began resuming operations as some big contracts have been landed with local and foreign experts. This would allow 800 workers to have incomes.

“We are happy that all of our three factories are in full operations now,” Vuong told Nhan dan Online.

Hoang Yen Company’s case is among more than 11,000 enterprises resuming operation in the first two months of this year nationwide.

According to the General Statistics Office (GSO), also in the first two months of 2021, the economy saw 18,100 newly-established enterprises with total registered capital of VND334.8 trillion (US$14.55 billion), employing 172,800 new labourers – up 4% in the number of enterprises, 52.2% in capital, and 9.7% in the number of labourers as compared to those in the same period of last year.

In particular, the average registered capital of each newly-established business in the two months of the year is VND18.5 billion (US$804,347), up 46.4% year-on-year. If an additional VND385.6 trillion (US$16.76 billion) registered by 6,500 operational enterprises is included, the total registered capital inserted into the economy in the first two months is VND720.4 trillion ($31.32 billion).

In February, despite the Lunar New Year, the number of newly-established firms hit more than 8,000 registered at VND179.7 trillion (US$7.81 billion), down 20.3% in the number of enterprises but up 15.9% month-on-month and 85.6% year-on-year in capital. The average registered capital of each business in the month reached VND22.4 billion (nearly US$974,000), up 45.5% month-on-month and 111.6% year-on-year.

Also, in February, the number of businesses with halted operations reduced 80.1 month-on-month and 21.3% year-on-year. Furthermore, the number of those with halted operations and waiting for dissolution decreased 53.5% month-on-month and 32.2% year-on-year.

“These are extremely positive signals for the economy in the context that the COVID-19 pandemic remains very complicated, badly affecting the business and production activities of businesses,” said a GSO report on the economy’s two-month economy.

Optimistic expectations

According to global data analyst and provider FocusEconomics, after economic growth gained further momentum in the fourth quarter of last year, whose growth hit 2.91% in 2020, signs for the first quarter of 2021 are generally positive.

“Economic growth is projected to rocket this year amid strengthening domestic and foreign demand, with Vietnam set to continue outperforming its regional neighbours. The recent spike in COVID-19 cases and associated implementation of restrictions are a cause for concern, however, while a possible prolonged downturn in the tourism sector remains a key downside risk,” FocusEconomics told Nhan dan Online in a statement. “Our panellists expect GDP to expand by 7.4% in 2021, which is unchanged from last month’s forecast, and by 6.9% in 2022.”

A few weeks ago, Standard Chartered released its fresh forecast for Vietnam’s 2021 GDP growth.

“Standard Chartered expects Vietnam’s GDP growth to rebound to 7.8 per cent in 2021, from 2.91 per cent in 2020, with manufacturing likely continuing to drive the economy and helping Vietnam outperform the rest of Asia,” said the bank on a statement. Spurring confidence

With a view to fuelling the economy and support enterprises and investors, on January 1, 2021, Prime Minister Nguyen Xuan Phuc signed and enacted Resolution No.01/NQ-CP on key tasks for implementation of the socioeconomic development plan and state budget estimates for 2021, as well as Resolution No.02/ND-CP on continuing implementation of measures to improve the domestic business climate and enhance national competitiveness in 2021.

According to Resolution 01, in order to realise the socioeconomic development plan for 2021-2025, the government has identified “solidarity, discipline, innovation, and aspiration for development” as guidelines for action this year.

The government defined 11 key missions and measures, including effective implementation of tasks to serve the organisation of the Party Congress, election of deputies to the National Assembly and all-level people’s councils, and preparation, issuance, and implementation of action programmes to carry out the resolutions.

The government will also continue implementation of tasks in a flexible and effective manner to simultaneously fight the pandemic and boost economic growth; while completing institutions for the socialist-oriented market economy, thus facilitating economic recovery and development based on stabilising the macro-economy and curbing inflation rate, as well as improving the economy’s resilience.

Meanwhile, according to Resolution 02, the government requested ministries, municipal and provincial people’s committees, and other governmental agencies to comprehensively and effectively enforce main tasks and solutions to enhance Vietnam’s business environment and national competitiveness in 2021.

The government ordered priority to be given to improving several indexes and indicators regarding construction permit issuance, asset registration, settlement of contract disputes, bankruptcy of enterprises, land administrative management quality, application of information technology, quality of vocational training, students’ skills, patent granting, fighting against corruption, online transactions, job opportunities in knowledge-intensive sectors, and a sustainable ecosystem.

Notably, Resolution 02 underlined the mission for the national digital transformation programme by 2025 with a vision towards 2030 approved under Decision No.749/QD-TTg last June, which must align with public administrative reforms.

Both resolutions 01 and 02 aim to reach the ultimate goal of securing an economic growth rate of at least 6.5% for 2021, with improvements in national economic competitiveness and in the local investment and business climate in favour of investors and enterprises.

The resolutions demonstrate the government’s unceasing efforts to drive the economy forward, though last November the NA seemed to take great caution when it set the economic growth target at about 6% only.

Each percentage of growth can create 300,000 direct jobs and many other hundreds of thousands of indirect jobs, according to experts.

Ngo Dinh Vuong of Hoang Yen Garment and Trading JSC said that he expected the resolutions will be materialised via specific solutions and programmes by ministries, agencies, and localities.

“The economy is bouncing back, and we hope the solutions will continue helping enterprises like us to not only stay afloat but also to weather all difficulties now and ahead. This will help the economy ensure the government desired economic growth,” Vuong told Nhan dan Online.

Key targets for the country’s socioeconomic development in 2021
	Index	Unit	Plan for 2021 by National Assembly	Government targets for 2021
1	GDP growth	%	About 6	About 6.5
2	Per capita GDP	US$	About 3,700	About 3,700
3	Average consumer price index	%	About 4	About 4
4	Ratio of total factor productivity in economic growth	%	About 45-47	About 45-47
5	Increase of labour productivity	%	About 4.8	About 4.8
6	Trained labourers	%	About 66	About 66
In which, labourers with diplomas and certificates	%	About 25.5	About 25.5
7	Population with health insurance	%	About 91	About 91
8	Reduction of poverty rate under multidimensional poverty index	Score	1-1.5	1-1.5
9	Urban residents with access to clean water via concentrated water supply systems	%	Over 90	Over 90
10	Collection and treatment of urban solid waste from households	%	Over 87	Over 87
11	Operational industrial parks and export processing zones with concentrated wastewater treatment facilities that meet environmental standards	%	About 91	About 91
12	Forest coverage	%	About 42	About 42

Source: Resolution No.1/NQ-CP dated January 1, 2021, on key tasks for implementation of the socioeconomic development plan and state budget estimates for 2021

IFC supports Hanoi to attract high value-added investments

June 27, 2020 by hanoitimes.vn

The Hanoitimes – IFC will work with Hanoi to formulate a new-generation FDI strategy in response to the government’s master plan on foreign investment promotion toward 2030.

IFC, a member of the World Bank Group, today [June 27] signed a memorandum of understanding (MoU) with the People’s Committee of Hanoi to support its efforts to attract new-generation foreign direct investment (FDI) and diversify its funding sources, thereby sustaining the city’s rapid economic development, competitiveness, and inclusive prosperity.

IFC will work with Hanoi to formulate a new-generation FDI strategy. Photo: Nguyen Tung.

As one of the fastest growing cities in Asia and home to over eight million inhabitants, Hanoi accounts for one-fifth of Vietnam’s gross domestic product (GDP).

Hanoi attracted US$8.45 billion in FDI in 2019, highest among the country’s 63 cities and provinces. Three areas namely property development, processing and manufacturing, and telecommunication and information drew the largest shares of FDI.

To sustain robust socioeconomic development, Hanoi aims to attract higher-quality streams of FDI. This will support the city’s strategy of developing high-tech and high value-added industries, increasing local sourcing, and creating more and better jobs.

“Strategic FDI as guided in the Politburo’s Resolution 50/2019 on orientations to finalize policies and mechanisms to promote FDI quality and effectiveness toward 2030 plays an essential role in sustaining Hanoi’s sustainable economic and employment growth and in realizing its industrialization and modernization plan toward 2030,” said Nguyen Duc Chung, Chairman of the People’s Committee of Hanoi.

“We welcome IFC’s support in developing a new investment strategy and diversifying funding sources as well as mobilizing quality investors through its global network,” Chung added.

Under the MoU framework, IFC will work with Hanoi to formulate a new-generation FDI strategy in response to the government’s master plan on foreign investment promotion toward 2030. Where possible, IFC will also assist Hanoi in diversifying its funding sources. The overall effort will leverage IFC’s global network of clients and partners, with benefits to potential key sectors including financial markets, infrastructure, logistics, and health and education.

“Hanoi already possesses many key factors that are attractive to higher quality FDI. The current environment of global supply chain changes — as a result of the Covid-19 pandemic — provides a good opportunity for the city to further prioritize FDI inflows in line with its development strategy,” said Kyle Kelhofer, IFC Regional Manager for Vietnam, Cambodia, and Lao.

“This includes FDI with increased local value-addition, with increased technology focus, to strengthen foreign-local firm linkages and help enhance local supply chain opportunities, foster improved job opportunities, and boost the overall competitiveness of the city.”

Promoting private sector development, IFC has been supporting Vietnam to improve business competitiveness and attract international investors over the past two decades. Most recently, IFC worked with the Ministry of Planning and Investment on recommendations for Vietnam’s new national FDI approach. It is also helping Vietnamese manufacturers improve capacity and supply to multinationals through a pilot Vietnam Supplier Development Program.