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VinFast announced it has successfully developed three smart SUV electric cars

VinFast, the 100 percent Vietnamese-owned automobile manufacturer, announced it has successfully developed three smart SUV electric cars VF31, VF32 and VF33, having a self-propelling feature and using AI.

The manufacturer plans to begin taking orders for VF31 standard version from May 2021 and deliver in November 2021. As for VF32 and VF33, it will begin taking orders from September and deliver from February 2022.

The Vietnamese electric car market, which began developing several years ago, is expected to warm up in the time to come with the presence of VinFast.

Agencies report that car demand in Vietnam is increasing rapidly, and is expected to reach 800,000 cars per annum by 2025 and 1 million cars per annum by 2030.

The rapid increase in the number of cars will lead to a high volume of emissions which will pollute the environment. Electric cars will be a good solution, especially in large crowded cities.

Three years ago, Mitsubishi Vietnam launched two models – iMIEV and Outlander PHEV. The former used 100 percent electricity, while the latter was a hybrid, using both petrol and electricity. With a full battery, the car could run 60 kilometers.

However, they didn’t sell well.

Porsche Vietnam in October 2020 distributed the electric Taycan model with three versions – Taycan 4S, Turbo and Turbo S. However, only two products were brought to Vietnam and shown at the product introduction ceremony.

Fuso, a brand of German Diamler, once had a plan to bring electric vans to Vietnam in 2019, but that has not occurred.

A survey by Frost & Sullivan, in Southeast Asia, including Indonesia, Thailand, Malaysia, Vietnam and the Philippines, high prices are not the reason behind the modest sales of electric cars. The problem is that consumers have worries about the way the vehicles operate and about infrastructure quality.

Manufacturers say that electric cars are 27 percent more expensive than petrol-run cars, but their operation cost is 25 percent lower. It is estimated that the total amount of money spent on one electric car is equal to one petrol-run car after five years of operation. So, electric cars are affordable for many people.

Nguyen Minh Dong, an automobile expert, said the biggest disadvantage of electric cars is that they cannot go far. The best models go 400 kilometers at maximum. Meanwhile, it takes a long time to recharge cars.

One of the most important components of electric cars is the energy storage unit. All the electric cars now available use Lithium technology. However, the energy storage capacity of these batteries is believed to be critical. If manufacturers want to improve the energy storage capacity of the batteries, the weight of the batteries will be higher, which leads to high costs and poor performance.

In general, the current battery technology cannot satisfy the requirements on travel distance and cost optimization. And the currently used liquid batteries pose high risks of explosion and fire.

Agencies report that car demand in Vietnam is increasing rapidly, and is expected to reach 800,000 cars per annum by 2025 and 1 million cars per annum by 2030.

To successfully commercialize electric cars, it is necessary to improve the energy storage capacity to allow longer travel distance after each recharge and shorter recharging times.

The second problem lies in infrastructure conditions. There should be many fast recharging stations everywhere. But this has not occurred. Electric cars remain uncommon and are just considered vehicles that serve short-distance travel.

However, what concerned him was the poor infrastructure conditions in Vietnam and the lack of recharging stations. Finally, he gave up his intention to distribute electric cars.

He said that Tesla 3 can travel up to 300 kilometers, which is the distance from Hanoi to Vinh City. If drivers stop to recharge the car at a café or restaurant on the way, they will have to wait too long.

Automobile manufacturers can see the problem and they have tried to develop infrastructure. VinFast is joining forces with petrol retailers and some large cities to develop networks of recharging stations.

The stations would be set up at parking lots, convenience stores, basements of apartment buildings, schools, dormitories and filling stations. Drivers would just need to spend 15-30 minutes to recharge their cars.

Porsche Vietnam, before importing Taycan to distribute in Vietnam, built two fast recharging stations in Hanoi and HCM City, which recharged 80 percent of battery capacity within 22.5 minutes.

Tran Thuy

Mitsubishi Corp has decided to pull out of the Vinh Tan 3 power plant in Vietnam, two sources familiar with the company’s thinking on the matter told Reuters , as it shifts away from carbon intensive businesses in the face of climate change.

Mitsubishi’s move to exit the estimated $2 billion project shows how willing Japanese companies and financiers are to drop their once-strong support for coal amid pressure from shareholders and activists.

Japan’s big banks regularly topped lending league tables for coal mines and power stations. But, in a little over a year, they have committed to ending their financing for the dirtiest fossil fuel, albeit over decades.

The Japanese trading house will pull out of the 2-gigawatt Vinh Tan 3 project, located in the southern province of Binh Thuan, because of climate targets, the sources who spoke on condition of anonymity said.

Mitsubishi has committed to reducing their investment in coal power to keep in line with international climate goals, according to its environmental statement, which a company spokesman pointed to in response to questions on Vinh Tan 3. He declined to comment on that particular project.

The Japanese trading house also has a stake in the Vung Ang 2 coal station being built in the central province of Ha Tinh, which is more widely known due to the focus on that project by environmental and other groups as well as investors.

Mitsubishi is a sponsor of the project through a joint venture with Hong Kong’s CLP Holdings where they have a 49% stake. Electricity of Vietnam Group has a 29% stake with Thai Bin Duong Group holding the remainder, according to Market Forces. Operations were due to start around 2024.

Vietnam is likely to shift away from a large rollout of coal power as renewables investments start to take hold, analysts have said.

Rice exports enjoy opportunities for breakthrough in 2021

High hopes are pinned on Vietnam’s rice exports in 2021 when major export markets such as the Philippines and Africa continue to sign contracts to buy rice from Vietnam, while many others have great demand for fragrant rice and sticky rice – which are advantageous staples of Vietnamese enterprises.

The bilateral and multilateral free trade agreements between Vietnam and other countries such as the EU-Vietnam and the UK-Vietnam FTAs with preferential tariffs would create favourable conditions for Vietnamese rice to compete with that from rival countries, the Vietnam Food Association said.

According to the Vietnamese Trade Counsellor in the UK Nguyen Canh Cuong, rice shipments to the country this year will sharply rise against 2020. He added more UK firms will purchase Vietnamese rice under the UK-Vietnam FTA, creating a chance for Vietnamese rice to expand its market share in the UK this year.

In 2019, rice exports from Vietnam to the UK had a leap forward with a turnover growth of 376 percent. That meant the UK has great potential as a rice export market for Vietnam.

In order to tap into the advantages under FTAs, rice export giants such as Intimex JSC, Loc Troi Group, VRICE Co, Trung An High Technology Agriculture JSC are planning to seek new customers in markets where Vietnam had signed FTAs, especially in the UK.

The Ministry of Industry and Trade said it would provide rice export firms with information about the market demand situation in a timely manner while implementing trade promotion activities to help Vietnamese rice exporters better access customers.

Detailed information about the regulations and barriers under these FTAs’ commitments will be also offered by the ministry so that businesses can improve their understanding and draw up suitable business plans.

As part of its efforts to facilitate Vietnam’s rice exports, the VAF has built up online sales channel and participated in online trade seminars to develop the rice industry.

It suggested rice exporters focus on high quality products with good export results, ensuring food hygiene and safety to be able to enter fastidious markets such as Europe, America and Canada.

Experts have said that if Vietnam wants to maintain rice export growth in 2021 it needs to focus on building a complete rice value chain and controlling quality in production, processing, and distribution.

According to the Ministry of Agriculture and Rural Development, Vietnam’s rice output totalled 42.8 million tonnes in 2020, down about 0.2 percent because of the shrinkage of some 192,000 hectares in farming areas. However, the productivity rose 50kg per hectare from a year earlier.

The areas of high-grade rice varieties have expanded to 74 percent, compared to 50 percent in 2015, as a result of the country’s efforts in improving the value of the Vietnamese rice.

Thanks to that, the shipments of high-grade rice made up more than 85 percent of the total, resulting in the growth of average rice price from 440 USD per tonne in 2019 to 496 USD per tonne in 2020.

The country exported 6.15 tonnes of rice for 3.07 billion USD last year, down 3.5 percent in volume but up 9.3 percent in value year-on-year.

The Philippines was Vietnam’s leading rice importer, making up 34 percent of the total. Rice exports to this market in 2020 reached 2.22 million tonnes and 1.06 billion USD, up 4 percent in volume and 19.3 percent in value compared to 2019.

Other outlets with significant export growth in 2020 were Indonesia, (nearly triple 2019’s figure) and China, up 93 percent year-on-year.

VFA Vice Chairman Do Ha Nam described 2020 as a successful year for Vietnam’s rice exports, which he attributed to increasing demand in many countries and the improved competitiveness of Vietnamese rice around the world.

Amid the difficulties posed by the ongoing COVID-19 pandemic, rice exporters quickly made appropriate adjustments and actively sought new markets while fully tapping into the advantages brought about by FTAs.

The EU-Vietnam FTA had created a major opportunity for Vietnamese rice to enter European markets and then make inroads into other choosy markets, Nam said./.

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.

Online shops see robust business amid a global pandemic

While various businesses reported losses and difficulties, online shops have had a solid development in 2020.

According to Vietnam’s e-Commerce and Digital Economy Agency under the Ministry of Industry and Trade, the growth rate of the local e-commerce sector in 2020 was 18% and valued at USD11.8bn. It accounted for 5.5% of the country’s retail goods and consumer service revenue.

Nguyen Chanh Trung, a shop owner on Lazada, said he started his online business after working for five years in the construction sector. His shop was opened on the first days of the Covid-19 outbreak in Vietnam and gained unexpected profits.

“I learned everything from scratch and tested out new ideas. I also attended training classes offered by Lazada to optimise the business and take care of the customers,” he said. “Online trading minimise staff and rental costs. After a year, staff numbers fell from 20 to 10 and revenue increased by 10%.”

Even though Trung had a website to introduce his products before, his business was mostly offline and badly affected by Covid-19.

Another online seller also saw great profits from selling face masks and handwash.

The number of sellers on Lazada doubled in 2020. LazMall, a trade site based on Lazada saw both customers and orders double on normal days and triple during festivals. Another e-commerce platform Tiki said in March and April 2020, the number of orders on the platform increased by 15% compared to the two busiest months in 2019. Sometimes, there were 4,000 orders placed per minute.

Vietnamese sellers also went to international e-commerce platform to sell their products overseas like Amazon or Alibaba. Over USD1m worth of products were sold via Amazon in 2020, triple the total amount sold in 2019.

Dang Hoang Hai, head of Vietnam’s e-Commerce and Digital Economy Agency said Covid-19 actually gave a strong boost to online businesses, forcing many firms and individual sellers to go online. Decision 645 issued by the government about the e-commerce development plan for 2021-2025 also helped speed up the transition.

Estimations from Google, Temasek and Bain and Company showed that Vietnam’s e-commerce market would be worth USD52bn and stand among the three biggest markets in ASEAN in 2025 if the growth rate stays at 29% a year.

Tran Toan Thang from the National Centre for Socio-Economic Information and Forecast said the e-commerce market would have developed strongly with or without the pandemic. However, Covid-19 has been a strong boost to the local market.

“Some product sales increased by 300% online. Because of the pandemic, shopping online has become a habit now,” he said.

HCM City Real Estate Association optimistic about 2021

HCM City Real Estate Association (HoREA) is optimistic that the real estate market in 2021 will see strong recovery and provide a large amount of accommodation for the city in the next 5-10 years.

One of the main development areas is the newly-established Thu Duc City which has the highest number of real estate projects in HCM City. It will attract various kinds of real estate projects. Cu Chi, Hoc Mon, Binh Chanh and Nha Be districts will all be upgraded and urbanised.

Both the number of farmers and farming lands in these districts will be reduced by 3-31%. Can Gio District was planned to become a seaside and eco-friendly town with the mangrove forest which is a part of Can Gio Biosphere Reserve.

According to the HoREA, HCM City has been allowed to convert 26,000ha of agricultural land in several outskirts districts into industrial and commercial lands. The government also issued many support policies to help real estate investors operate and complete procedures more smoothly.

Le Hoang Chau, chairman of HoREA, confirmed that Resolution 148 which took effect on January 1, 2021, the 2020 Investment Law and the adjusted 2020 Construction Law have helped make the policies and regulations clearer and more suitable.

“In 2021, the government will issue more detailed regulations and directives about the Investment Law and adjusted Construction Law to speed up the renovation of dilapidated apartment buildings and apartments for low-income people. This will help boost the real estate market in 2021 and the following years,” he said.

Quick action required to attract high-quality FDI

The US-China trade war and the COVID-19 pandemic have provided Vietnam with an opportunity to attract foreign investment (FDI) as global capital flows tend to shift to safe havens. This is also a time when our country needs to drastically change our thoughts and actions in the selection of FDI partners and projects to move more towards high-quality capital flows as directed in Politburo Resolution No. 50. These factors make FDI attraction become a focal point of the “COVID year” in 2020 and will continue to do so in the years to come.

At a seminar held between Vietnam’s chief representatives abroad for the 2020-2023 term and the Committee for the Management of State Capital at Enterprises, Deputy Minister of Foreign Affairs Bui Thanh Son said that Vietnam is now a bright spot in investment attraction and more than 126 large corporations shifting their investments are now looking to invest in Vietnam.

Meanwhile, Director of the Foreign Investment Agency under the Ministry of Planning and Investment Do Nhat Hoang revealed that although investment activities were interrupted due to the impact of the pandemic, the Ministry of Planning and Investment (MPI) and senior leaders of large corporations around the world still maintained discussions about investment cooperation opportunities through many channels. In particular, a number of online seminars were held at the operation centre of the MPI to connect with destinations across the world so that large corporations can find out more investment information regarding Vietnam. Through this activity, many large corporations started negotiations to bring investment projects into Vietnam with registered capital of billions of US dollars.

According to the United Nations Conference on Trade and Development (UNCTAD) global investment in 2020 declined by 40%, but FDI inflows into Vietnam saw a much lower rate than other countries in the world and the region, especially in disbursed capital. Export and import turnover of FDI enterprises also decreased slightly compared to the same period in 2019.

“Despite the many difficulties that arose due to the COVID-19 pandemic, FDI enterprises have still maintained relatively good production and business activity levels. This is a positive signal, demonstrating the confidence of foreign investors in the investment environment in Vietnam and also proving that Vietnam is still seeking further FDI,” Hoang emphasised.

In 2020, not only manufacturers, but also supply companies shifted investment to Vietnam, as well as providers of logistics and warehouses services and others doing likewise. Big manufacturers are considered “queen bees” coming to Vietnam to build a hive, bringing along “worker bees” – suppliers and supporting manufacturers, and creating a new ecosystem and supply chain in Vietnam.

This trend is happening in the electronics industry, as the story of Samsung has shown and is now also evident in the story of animal feed, e-commerce, consumption, and auto parts industries.

Acting fast to seize opportunities

Dr Nguyen Dinh Cung, a member of the Economic Advisory Group to the Prime Minister, expressed his concerns about FDI attraction in Vietnam. According to the expert, opportunities for Vietnam in terms of the shifting of global investment capital flows is great, but the “eagle” itself will not come if we take no action.

“I have just had the opportunity to work in Quang Ninh and Hai Phong, a region with a lot of potential in terms of its land and synchronous infrastructure, thanks to its seaport system and airport linked with Hung Yen ,creating a large industrial park capable of attracting the world’s leading technology enterprises. If there is a policy of regional linkage, these localities can create further intrinsic attractiveness to lure “eagles” to turn Vietnam into an important global production location. If these localities still compete in the attraction of FDI as before, they will only scatter and reduce Vietnam’s attraction in the eyes of foreign investors,” Cung said.

To seize the opportunity, it is advisable to take quick action and change the methods of attracting investment. First of all, the concept of “high quality investment” must be clearly defined to set screening criteria and formulate suitable policies for each industry and region in order to actively attract investors. To do this, it is necessary to have a new approach tailored to specific projects and investors, not applying a general policy to all projects.

Meanwhile, investors pouring capital into Vietnam can enjoy outstanding incentives but must also meet set conditions and be a reputable and socially responsible investor.

Referring to the concept of “preparing the nest to welcome the eagles”, used recently to regarding the attraction of high-quality FDI in Vietnam, Prof. Nguyen Mai, President of the Vietnam Association of Foreign Invested Enterprises (VAFIE) said that there were “eagles” but so far only Asian and a few European or American eagles. This is the time for Vietnam to proactively direct the flow of FDI and prepare conditions to attract high-tech and pervasive projects to meet the needs of the country’s new development period.

In the context of a decline in global investment activities due to the impact of the COVID-19 pandemic, although Vietnam has many advantages and has emerged as a bright spot in investment attraction, FDI inflows have not yet strongly recovered. This is the time for Vietnam to improve its investment and business environment to stand ready to welcome big waves of FDI.

Shrimp exports set target of US$ 4.4 billion in 2021

Despite the complicated developments of the Covid-19 epidemic, shrimp was still a commodity that brought high economic value in 2020, with export turnover of US$3.7 billion, an increase of 11% over the same period in 2019. It is expected that in 2021, shrimp exports can increase by 15% compared to 2020, the export turnover would reach over US$ 4.4 billion.

In order to achieve the goal, businesses should focus on promoting deep processing and increasing added value, while at the same time proactively seizing opportunities from changes in the market due to the impact of Covid-19 translation.

High growth forecast

Looking through the whole year 2020, shrimp exports achieved very encouraging results.

According to Tran Cong Thang – Director of Institute of Policy and Strategy for Agriculture and Rural Development (IPSARD), compared to rival countries in 2020, Vietnam had an advantage due to better control over the Covid-19 epidemic. The main consuming markets such as the US, the European Union (EU), and China gave priority to buying shrimp from Vietnam.

While major shrimp producing countries such as India, Ecuador, and Thailand, etc. all suffer from the negative impacts of the Covid-19 pandemic, such as stagnated production and transport of goods, the decrease in shrimp prices is leading to a decrease in shrimp production.

In addition, the proactive market rotation, taking advantage of the opportunities created by the changes in the market caused by the Covid-19 pandemic, diversifying products suitable for each market segment, has helped businesses in the industry to not only maintain but also increase export turnover. Therefore, the shrimp export turnover reached US$3.7 billion, up 11% compared to 2019. Shrimp have been exported to 135 markets through 508 export enterprises.

The major markets that kept positive growth rates were: the US, with an increase of 33%; the EU (6.1%); the Republic of Korea (ROK) (3.3%), and the UK (20.1%).

In addition, to achieve the good growth in export turnover, the domestic supply also plays a significant role.

In the first months of 2020, shrimp production faced difficulties due to Covid-19 epidemic accompanied by saltwater intrusion in key farming areas, leading to a decrease in brackish water shrimp production, especially black tiger shrimp.

By the end of 2020, brackish water shrimp production had recovered, with the disease under control. The export of brackish water shrimp has been restored; the disease on farmed shrimp is also under control, helping brackish shrimp production grow well, ensuring a sustainable supply for export.

According to the General Department of Fisheries, in 2020, the production of black tiger shrimp reached 267,700 tons, an increase of 1%, and white leg shrimp reached 632,300 tons, up 8.5% over the same period.

In Ca Mau Province, the first months of 2020, many seafood importers have suspended, postponed or canceled deliveries, making seafood export difficult. However, the Government, ministries, central branches, and provincial People’s Committee have promptly implemented many support measures to ensure stable production and business conditions.

At the same time, the EVFTA took effect to create more favorable conditions for businesses to export to EU countries (by 2020, seafood export turnover to the EU reached about US$100 million, accounting for 9.7% of the province’s export turnover, up more than 400% over the same period in 2019).

Experts say that, if the farming and processing stage is well ensured, Vietnam’s shrimp export growth milestones will be achieved in 2021. The introduction of Covid-19 vaccine together with the advantages from FTAs being utilised by businesses will be the driving force for shrimp export activities in 2021.

These forecasts are grounded, as from the beginning of 2021, eight cargo containers, with more than 160 tons of shrimp, owned by Minh Phu Seafood Corp. (at Song Hau Industrial Park, Chau Thanh District, Hau Giang Province), have been exported to potential markets of Vietnam, namely the EU, the US and Japan. This shipment is a good signal for the export shrimp industry in 2021.

Taking advantage of opportunities

According to experts in the fisheries sector, in 2021, Vietnam’s the good control of Covid-19 epidemic and joining bilateral trade agreements with other countries will create favourable conditions for exporters.

According to the Vietnam Association of Seafood Exporters and Producers (VASEP), world shrimp demand will continue to increase, especially in the context of the Covid-19 pandemic, while the demand for processed seafood eaten at home will increase sharply. VASEP forecasts that shrimp exports can reach an export turnover of US$ 4 to 4.4 billion in 2021.

However, in order to continue good export growth, it is necessary to have specific solutions:

Firstly, it is necessary to organise the production management and management of suitable cultured shrimp breeds, control diseases well and ensure the quality of seed supplied, avoid production risks to stabilise supply, increase high quality products.

Second, it is necessary to ensure the supply of raw materials with sufficient quantity and quality, especially in the farming stage by applying new science and technology.

Third, it is necessary to make good use of market expansion opportunities through increasing supply capacity to compensate for production shortages because other supplying countries are being negatively affected by the Covid-19 epidemic that affecting production and export supply chain; it is necessary to increase competitiveness and market share in big and strategic markets such as the EU, the US, Japan, South Korea, and the UK. It is necessary to improve the quality of export products, take advantage of tariff advantages for pure Vietnamese origin of farmed shrimp products in the new generation of free trade agreements (FTAs).

In order to effectively implement the above solutions, according to IPSARD’s Director Tran Cong Thang, it is necessary to improve the processing capacity of enterprises, focus on technology investment, intensive processing, to meet the needs of importing countries.

The enterprise should develop deeply processed products and value added products to serve a wide range of customers and market segments. Enterprises and farmers need to prepare well the conditions and stocking according to the 2021 seasonal calendar.

It is necessary to attach importance to disease prevention and control, control impurities, chemical and antibiotic residues in shrimp products to ensure disease safety and food safety. In addition, it is necessary to strengthen links between units participating in the production chain in order to improve quality, ensure traceability, and continue to increase the proportion of value-added goods in exporting.

It is necessary to replicate effective models and production chains while maintaining and developing the “output” market. It is also necessary to participate in trade promotion programs to promote seafood products, including processed shrimp, seek new markets and toward sustainable export.

Experience in implementing FTAs

Despite violent pandemic and geopolitical upheavals, 2020 marked an important milestone in Vietnam’s international economic integration.

In addition to the effectiveness of the EU-Vietnam Free Trade Agreement (EVFTA) since August 1, 2020, the Regional Comprehensive Economic Partnership (RCEP) agreement was signed under the framework of the 37th ASEAN Summit, helping to create a market with 2.2 billion consumers, accounting for about 30% of the world’s population and a total GDP of approximately VND26.2 billion (about 30% of the global GDP). This is a happy ending after eight years of intense negotiations, even without the participation of India.

By the end of November 2020, Vietnam had been negotiating 16 free trade agreements (FTAs) that cover almost all continents including nearly 60 economies, with total GDP accounting for about 90% of world GDP, as well as 14 agreements set to come into force.

The signed FTAs ​​also contribute to creating optimism in the business community, consolidating business confidence as well as promising a bright economic outlook.

“Despite a difficult year for international trade in 2020, our survey shows that Vietnam’s quick and effective response to the global pandemic has proved its efficiency. Leaders of European enterprises feel more positive about their businesses as well as Vietnam’s trade and investment environment,” said Chairman of the European Chamber of Commerce (EuroCham) in Vietnam Nicolas Audier at the ceremony to announce the Business Climate Index (BCI) in the fourth quarter of 2020.

Caring for orchard in the wait to pick fruit

Prime Minister Nguyen Xuan Phuc expressed his delight at the effectiveness of the EVFTA but also reminded that results gained from FTAs ​​have yet to match the potential and raised many big bottlenecks that must be removed. It is the necessity to improve communication efficiency about international economic integration and FTAs in particular, to remove invisible barriers for businesses, and to change the mindset of doing business in a more proactive manner to meet the requirement of FTAs, among other tasks.

Indeed, if you compare FTAs ​​to an orchard, the gardeners must invest both capital and effort in the orchard every day before they can enjoy the fruit from this garden. And almost no single enterprise can do this alone; the process requires cooperation and linkage.

According to General Director of Garment 10 Corporation Than Duc Viet, Garment 10 produces 18 million shirts and 1.5 million suits each year, so it needs 30 million meters of shirt fabric and 5 million meters of suit fabric. However, the company has to import 60-70% of materials from China to serve its production because raw materials produced in Vietnam are more expensive than imports from China while the speed of development of models and production time is also longer.

It means that the company cannot benefit from EVFTA and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) because it does not meet requirements on origin of products.

“The policy of promoting multilateral relations through Vietnam’s participation in a series of FTAs ​​is absolutely correct, but it will only bring into full play when Vietnam can successfully solve challenges regarding labour conditions, environmental protection and social responsibility,” said Dr. Vo Tri Thanh, Director of the Institute for Brand and Competitiveness Strategy.

Responding to barriers

Although the dispute settlement mechanism will be more complete because both the CPTPP and the EU-Vietnam Investment Protection Agreement (EVIPA) have provisions to improve the transparency of the proceedings, Vo Tri Thanh warns that once tariff barriers are no longer an effective tool for protection, importing countries tend to use non-tariff measures (anti-dumping, anti-countervailing and trade remedies measures) to protect their own domestic manufacturing industry.

As an experienced lawyer in handling international economic disputes, Dinh Anh Tuyet, an arbitrator from the Vietnam International Arbitration Centre (VIAC) said that: “It is important to note that signed FTAs are not only a “sweet fruit”, but also a “bitter fruit” for Vietnamese enterprises because if businesses do not comply with the standards stated in the FTA, the partners will apply new handling measures, and even lawyers like us do not know what the measures are, because they all appear for the first time in the agreements.”

The implication that the lawyer wants to talk about is that Vietnamese enterprises need to have the right attitude and actively respond to the risks of commercial disputes. It is also the choice that proves the correctness that shrimp exporting enterprises have applied from 2004 to present.

The preparation is sometimes very simple things such as maintaining detailed traceability records, accounting records, and production records in order to request timely support from the State and lawyers to protect their interests when there are violations under trade and investment agreements or when there are signs of trade fraud and tax evasion.

The cooperation with associations and importers and the coordination with investigating bodies when under investigation are also obvious recommendations but are sometimes neglected by enterprises. Besides FTAs, institutional reform and efforts from each enterprise are also key forces for long-term development.

A historical milestone in this Spring

The year 2020, with so many difficulties and challenges, has passed. Vietnam has shone once again! The world showed admiration and the people were excited and believed in.

The COVID-19 pandemic has cast a shadow across the globe. Millions of people have died, and the world economy has declined dramatically. Although the pandemic has been quite well controlled, our economy with large openness and deep integration could not avoid difficulties. Natural disasters, storms and floods raged in the Central region; and droughts and salt water intrusion in the Mekong Delta, etc.

In that very special context, under the sound leadership of the Party, the management and administration of the State, the entire political system and the entire people joined in a drastic, synchronous and persistent manner to comprehensively fulfil almost all set targets and tasks. The year 2020 is still considered the most successful year in the whole tenure, having gained remarkable achievements. Vietnam is considered a bright spot for disease prevention and control and socio-economic development. People’s living conditions are constantly being improved; and national defence, security, social order, and safety have been maintained. The work of Party building and rectification as well as the fight against negative activities, corruption and wastefulness has been drastically directed, achieving many positive results. Foreign affairs have been carried out effectively, contributing to consolidating and enhancing the position of Vietnam in the international arena.

The Party Congresses at all levels were a success, creating a premise for the successful 13th National Party Congress.

In difficulties, the tradition of patriotism, solidarity and mutual care of the people has been promoted, and the superiority of the socialist regime has been confirmed.

The New Year has come with intertwined opportunities and challenges. The situation of the world, the region and the East Sea (South China Sea) is still complicated and unpredictable, while our country is still facing numerous difficulties and challenges in socio-economic development and adaption to climate change, as well as ensuring national defence and security.

Along with the achievements obtained in the past year, the gift to celebrate the Spring has a very important meaning to decide the direction and development of the country in the next five years, with a vision to 10 years and 20 years from now is the Resolution of the 13th National Party Congress. In his speech at the year-end virtual conference of the Government, Party General Secretary and State President Nguyen Phu Trong affirmed that the entire political system needs to be proactive, actively grasp and well implement the Resolution of the 13th National Party Congress and resolutions of the Party Central Committee, the National Assembly and the Government right from the beginning of the year, with specific programmes and working plans that are in line with reality and have high feasibility, with the general spirit of being more proactive, active, and creative in order to achieve higher overall results than in the previous years and the previous tenure.

This spring, the success of the 13th National Party Congress marked another historic milestone on the path of national construction!

Long Thanh Airport expected to promote regional socio-economic development

The Long Thanh International Airport Project is a key project in the country’s transport infrastructure network approved by the National Assembly at the Resolution No. 94/2015/QH13 dated June 25, 2015 on the investment policy of the project and the Decision No. 1777/QD-TTg of the Prime Minister dated November 11, 2020 on approving the first construction phase of the Long Thanh International Airport Project with the total investment of US$4,664 billion.

The first items in the first phase of Long Thanh International Airport Project officially began construction on January 5. It is expected to create a hitch to promote socio-economic development not only in Dong Nai Province but also in the Southeastern region and the whole country after coming into operation.

Since the National Assembly approved the investment policy for the project, there have been more changes in people’s lives so far in the context of urbanization development in Binh Son Commune as well as in Long Thanh District.

Particularly, people whose land was acquired or affected by the project have received acceptable compensation to do their own business, to change jobs from agriculture sector to other careers.

If the agricultural land price around the airport project was only about VND1 billion (US$43,000) per hectare in advance the National Assembly’s approval, the price has increased by 10-15 percent following the approval. The compensation price from the State for people whose land was acquired to build the airport is about VND400 million (US$17,000) per hectare.

Mr. Vo Dinh Viet, a resident living in Long Thanh Town, has received VND21.4 billion (US$926,000) for 4.4 hectares of rubber trees affected by the project. After receiving the compensation, his family used the money to pay loans which they had got before for building a 3-star hotel and restaurant in the town’s center since 2016 and to continue to invest into land.

The project implementation also opens up opportunities to develop the finance and services industry for Dong Nai Province and attract large-scale banks to open their branches and transaction offices in the locality, thereby helping Dong Nai Province as well as the Southeastern region develop high-quality human resources.

Nearly US$1 billion has been disbursed in compensation for 5,000 hectares of land reclaimed for construction of the airport. So far, the project- affected people have been resettled, bought land and built houses. This has created more jobs in the fields of banking industry, land brokerage services and construction materials.

According to the leaders of the People’s Committee of Dong Nai Province, since the Long Thanh International Airport Project has not been started works yet, many domestic and foreign investors want to seek investment opportunities in the promising area.

When the airport comes into operation with a smoothly connected traffic infrastructure system, it is expected to certainly stimulate investment attraction and technology development in the Southeastern region. Currently, local economists are expected the approach and transfer of the latest and most modern technologies as well as machinery and equipment from the world’s leading technology corporations for construction of the project.

Once the airport comes into operation along with a smoothly connected traffic infrastructure system, it is expected to certainly stimulate investment attraction and technology development in the Southeastern region.

Deputy Secretary of the Provincial Party Committee cum Chairman of the People’s Committee of Dong Nai Province Mr. Cao Tien Dung informed that in the development plan for the upcoming years, Dong Nai Province has defined the construction of Long Thanh Airport Project as a motivation for socio-economic development.

According to the plan, the local authorities and private sectors will focus on certain investments to determinedly build an airport city, which is expected to create a great opportunity to develop the high technology, create a driving force for the province to boost the development of high-tech parks and head to export.

Dong Nai Province will focus on the development plan of socio-economic and traffic infrastructure to fuel industry and services development in districts near the airport.

Besides, the province will also re-plan agricultural development in remote districts, determine areas appropriate for fruit trees or vegetables and domestic animal breeding to invest in road and electricity infrastructure.

On the other hand, Dong Nai Province has just approved an Israeli-style high-tech agricultural development program. Experts from this Middle Eastern country will accompany local farmers to build and widen hi-tech models.

As for Ho Chi Minh City, once the Long Thanh airport comes into operation, it will contribute to reducing the overloading at Tan Son Nhat International Airport as well as traffic jams around the airport.

In order to make this plan soon come true, it is necessary to early build an overhead urban railway system connecting the two airports, strengthen investment into transport network systems, speed up building key projects through the airport such as Ben Luc – Long Thanh Expressway, Ring Road 3 and Cat Lai Bridge to reduce traffic pressure through the inner of Ho Chi Minh City, notably Cat Lai port area, National Highway No.1 through Binh Chanh District, National Highway No.22 running through districts of Hoc Mon and Cu Chi.

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

Logistics, considered a backbone of Vietnam’s economy, is among eight sectors prioritised by the national programme for digital transformation until 2025.

According to the Vietnam Logistics Business Association (VLA), the sector has grown 14-16 percent annually over recent years. It now gathers together some 3,000 domestic firms and 30 others offering transnational services.  Of those, 89 percent are domestic businesses and 10 percent are joint ventures while the number of foreign-funded companies represents just 1 percent of the total.

The VLA said the cost of logistics in Vietnam as a proportion of GDP is 18 percent, compared to 9-14 percent in developed countries. The high cost is attributable to limited sea port infrastructure and weak cost reduction efforts. Together with fierce competition, the digital economic boom, and pressure from the COVID-19 pandemic, these have made digitisation in the sector a must.

Vietnamese logistics companies offer between 2 and 17 services, mostly in transport, warehousing, and fast delivery. About half apply technology in their operations.

Nguyen Tuong, VLA Deputy General Secretary, said investment shortages from the very beginning, difficulties in choosing suitable technological applications, a sense of distrust in technology, and a fear of change are hindering the sector from pressing ahead with digital transformation.

Tran Thanh Hai, Deputy Director of the Agency of Foreign Trade at the Ministry of Industry and Trade, said transformation in this core sector would trigger a similar process in other parts of the supply chain.

Experts have said that smart logistics involve master plans and strategies with the involvement of cloud computing technology, adding that it will be conducive to improving customer services, information flows, and automation.

To reduce logistics costs, Nguyen Hoang Long, Deputy General Director of the Viettel Post Joint Stock Corporation, said the engagement of both the Government and enterprises is needed. While the Government should offer planning and assistance for the building of national logistics centres, as well as preferential land and port taxes, enterprises need to invest in better management and boosting connectivity within the sector, he said.

Administration reform and capital support are also necessary for logistics firms undertaking digital transformation, insiders have said./.

US removes anti-dumping duty on Minh Phu frozen shrimp

The Minh Phu Seafood Joint Stock Company announced on February 17 that US Customs and Border Protection (CBP) has cancelled a decision issued on October 13, 2020 on the imposition of anti-dumping tariffs on the company’s frozen shrimp products exported to the US.

Its CEO Le Van Quang said the latest CBP decision allows Minh Phu to continue exporting frozen shrimp to the US without being subject to an anti-dumping duty imposed on shrimp from India or any other anti-dumping duties.

Minh Phu has also been refunded anti-dumping duties it temporarily paid under the October 13 decision, Quang added.

The CBP had applied the Enforce and Protect Act (EAPA) to conclude that frozen shrimp products exported by Minh Phu to the US should be subject to duties in accordance with the anti-dumping order imposed on shrimp from India. It said the company did not provide sufficient evidence as requested by the CBP to prove that it was not using shrimp originating from India for export to the US.

Minh Phu decided to send an administrative complaint to the CBP’s senior agency, because the decision ignored key evidence that it had an effective traceability system and was not using raw shrimp from India for exports to the US.

In fact, Minh Phu clearly demonstrated its separation and traceability method approved by the National Oceanic and Atmospheric Administration (NOAA) under the US Department of Commerce, based on its requirements for the Seafood Import Monitoring Programme.

Minh Phu successfully applied and effectively operated a high-tech shrimp farming model at its two farming areas of Minh Phu Kien Giang on 600 ha and Minh Phu Loc An on 300 ha. It has also been establishing a network of shrimp suppliers across the Mekong Delta and Vietnam’s south that use diverse models of sustainable shrimp farming./.

HCM City sees sharp fall in number of tourists

Ho Chi Minh City recorded 1,800 visitors booking hotel rooms during the Lunar New Year (Tet) holiday from February 9 to 17, the municipal Department of Tourism reported after summarising figures from 22 of the 124 local 3 to 5-star hotels.

Tourists numbers were down sharply compared to Tet last year, primarily due to the COVID-19 outbreak right before the holiday.

Recognising that many people had decided not to return to their homeland because of the pandemic, many travel companies offered various short tours to nearby safe destinations.

Department Director Nguyen Thi Anh Hoa said it coordinated with accommodation providers to manage those coming from pandemic-hit regions while strictly implementing safety standards for COVID-19 prevention and control.

Providers were also asked to ensure guest safety by applying the Ministry of Health’s message featuring 5K (in Vietnamese) Khau trang (facemask)- (Khu khuan) disinfection- (Khoang cach) distance- (Khong tu tap) no gathering – (Khai bao y te) health declaration.

Analysts have forecast that fluctuations will be seen in the number of visitors to local accommodation providers this year, which are posting occupancy of less than 10 percent./.

Hapaco eyes investment in 4-trillion-VND wind power project

The Hapaco Group JSC is planning to invest 4 trillion VND (174.1 million USD) in a wind power project in the Central Highlands province of Gia Lai.

The project is among those to be submitted for approval at the group’s annual shareholders’ meeting, which is slated for March 14.

The meeting will also discuss an investment in building a 23-ha care centre for the elderly in the northern city of Hai Phong’s Thuy Nguyen district as well as Hapaco’s new development orientations in social housing and guest worker services.

Hapaco (stock code HAP) was one of the first listed on Vietnam’s stock market. As of December 31 last year, its total asset exceeded more than 808 billion VND.

Last year, the group reeled in 335 billion VND in revenue, an annual decrease of 11 percent. Its after-tax profit, meanwhile, hit 34.3 billion VND, up 69 percent on-year./.

HCM City: Consumer prices see slight rise after Tet holiday

Consumer prices in Ho Chi Minh City showed slight fluctuations on February 16, or the fifth day of the new lunar year and the last day of the Lunar New Year (Tet) holiday, with most traders in wet markets resuming business.

It is noteworthy that prices of fresh vegetables and fruit increased remarkably compared to before Tet, as consumers tend to buy more of those goods after feasting during the holiday.

Reports of the Thu Duc wholesale market said supplies of vegetable, fruits and flower are abundant at stable prices.

Besides wet markets, most supermarkets, convenience stores and shopping centres in the city are scheduled to re-open on February 17, ensuring supplies of goods when residents return to the city after the holiday.

In the context of unpredictable developments of the COVID-19 pandemic in the city and the country, businesses in HCM City have stocked 57.5 million facemasks and 3.39 million bottles of hand sanitizer to meet epidemic prevention demands./.

Brand building – key to add value to business

Vietnam enterprises need greater efforts to build their brand names so as to better competitive edge amidst rapid integration, according to experts.

According to the Ministry of Industry and Trade’s Trade Promotion Agency, although the number of businesses honoured with the Vietnam National Brand increased throughout years (from 30 in 2008 to 124 in 2020), it lagged behind expectations.

Deputy head of the agency Hoang Minh Chien said the Vietnam National Brand (Vietnam Value) Programme has raised awareness of many local firms and corporations of the important roles of brand name in improving value of their products and the businesses themselves.

It is difficult to develop Vietnam brand for specific products, he said, adding despite being the world’s leading agro-forestry-fisheries exporter, Vietnam lacks in branded products in its shipments.

Up to 80 percent of Vietnamese agricultural exports are yet to have brand name. Many exports in the nation’s “one-billion USD” club such as timber, rubber, pepper and cashew nuts have not their own brand names yet, according to agricultural specialist Hoang Trong Thuy.

Chairwoman of the Ngan Ha Science and Technoloy Company Limited Pham Thi Kim Loan said a good brand is developed from good-quality products as well as fine customer service and marketing strategies.

Meanwhile, Chairman of the Advice Council to the Institute for Brand and Competitiveness Strategy Nguyen Quoc Thinh stressed that besides financial resources, businesses need dogged determination and in-depth knowledge of brand building.

Chien said the Ministry of Industry and Trade will accompany enterprises to develop and popularise their brand names, adding focus will be sharpened on raising public awareness of brand development, helping businesses to satisfy criteria of the Vietnam National Brand Programme, and introducing the brands to domestic consumers and international partners.

According to the Brand Finance, value of the Vietnam Nation Brand skyrocketed 175 percent from 141 billion USD in 2016 to 319 billion USD in 2020. The country also jumped 17 places from 2016 to 33rd in the list of the world’s 100 most valuable brands compiled by the UK consultancy./.

Ninh Binh strives to host 7 million visitors in 2021

Ninh Binh  has launched promotion activities on social networks, among other activities.It is also working with the provincial tourism association to mobilise travel agencies’ engagement in demand stimulus activities and increase service quality.

Ensuring related security and order, environmental sanitation, and COVID-19 prevention and control are also key tasks, noted the official.

According to statistics from the department, during the recent three-day New Year holiday, the province received more than 32,000 visitors. Most of them went to local renowned destinations like Trang An Landscape Complex – a world cultural and natural heritage site, Cuc Phuong national park, and Van Long submerged natural reserve.

In 2020 the province hosted 2.8 million tourists, equaling to just 37 percent of the 2019 figure. The reduction was largely due to the impact of the pandemic./.

Kien Giang promotes border trade infrastructure connectivity with Cambodia

The southern border province of Kien Giang has facilitated the implementation of a memorandum of understanding on border trade infrastructure development and connectivity between Vietnam and Cambodia.

Ha Tien city and Giang Thanh district have been asked to build a list of border trade infrastructure items, with priority given to connectivity with Cambodian localities, according to the Vice Chairman of the provincial People’s Committee Nguyen Duc Chin.

Kien Giang has also supported trade promotion and the attraction of investments in border trade infrastructure construction.

Local competent agencies have taken measures to simplify administrative procedures in order to make it easier for traders and border residents in customs clearance.

The province has effectively implemented cooperation agreements with Cambodian localities and joined hands with the Cambodian side in national defence as well as external affairs in border areas./.

Kien Giang moves to promote marine economic growth

The Mekong Delta province of Kien Giang has planned to further promote sustainable marine aquaculture in line with the “Strategy for the Sustainable Development of Vietnam’s Marine Economy by 2030 with a Vision to 2045”.

Local leaders said the province will fully tap its potential and advantages to promote marine aquaculture in a modern manner in connection with tourism development, while ensuring the environment and national defence and security at seas and islands.

The plan aims to contribute to accelerating the restructuring of agriculture, promoting marine economic growth, and improving competitiveness and local incomes.

It aims to have 7,500 farming cages by 2025, including 4,700 traditional fish cages, 1,900 hi-tech fish cages, and 900 cages for breeding other seafood.

The water surface areas for cage farming and mollusc farming are expected to reach 7,000 ha and 24,000 ha, respectively.

The farming yield is to reach 113,530 tonnes and be worth 7.54 trillion VND (327.6 million USD), including 29,870 tonnes from cage farming and 83,660 tonnes from mollusc cultivation. The sector is forecast to employ 18,510 workers.

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.

Local authorities must also fully tap the potential and effectively use the sea for farming, towards promoting agricultural economic restructuring, increasing productivity and output, and ensuring food hygiene and safety.

The locality has worked hard to create more jobs and improve incomes in coastal communities and those on islands, cut inshore fishing activities, preserve the environment, and minimise activities that deplete natural aquatic resources.

It aims to develop marine farming at an industrial-scale using modern technologies that can produce a large volume of products for both export and domestic demand.

The province also attaches special importance to promoting links and cooperation in producing raw materials, processing and consuming aquatic products, ensuring food hygiene and safety, and protecting the environment, contributing to protecting and regenerating aquatic resources and preserving biodiversity.

It has synchronously implemented solutions on land and water surface areas for marine farming, and mechanisms and policies to boost production and attract investors to high-tech aquaculture.

The locality has also paid heed to applying credit and incentive policies to support aquaculture development and high-tech agriculture, as well as to improving the quality of human resources in the sector./.

Lao Cai aims to welcome 5 mln visitors this year

The northern province of Lao Cai, home to the popular holiday town of Sa Pa, has set a target of welcoming 5 million visitors this year and earning more than 696 million USD in tourism revenue.

The province will exert efforts to attract more domestic holidaymakers.

Sa Pa has long been among the country’s leading destinations. Of note, young people accounted for more than 70 percent of tourist arrivals to the town in 2020.

Lao Cai also aims to devise 130 new tourism products to meet demand from tourists and encourage them to return in the future.

Lao Cai’s tourism sector bore the brunt of the ill-effects of the pandemic and welcomed just 2.2 million visitors last year, down by more than half against 2019./.

Opportunities forecast for Vietnam’s economy in 2021: experts

Apart from challenges, many opportunities will be offered to the Vietnamese economy in 2021, experts have said.

Such agreements as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the EU-Vietnam Free Trade Agreement (EVFTA) to which Vietnam is a signatory will open up wide doors for the country to further integrate into the world.

Economist Nguyen Minh Phong forecast that Vietnam’s agriculture, industry, export-import, and the domestic financial, stock and real estate markets will grow further in the year.

Notably, with the current growth rate of the local processing sector, Vietnam would join the group of newly-emerging industrialised countries in the coming years.

Pham Dinh Thuy from the General Statistics Office said that the GDP growth target of 6.5 percent set by the Government is feasible in the normal situation. However, this would be a challenge for the country as 2021 is the first year of implementing the 2021-2025 socio-economic development plan.

The official pinned hope on the development of such sectors as food, garment-textile, wood processing, metal production, construction and electricity production.

To achieve the set economic targets, it is a must to contain the COVID-19 pandemic, he said, suggesting stepping up economic restructuring, churning out typical products, streamlining administrative procedures, improving the domestic investment environment, and improving the country’s competitiveness.

Thuy also highlighted the significance of trade promotion and foreign investment attraction, which, he said, needs specific plans.

Pham Viet Hoai, Chairman of Kym Viet JSC, said the application of digital technology would bring about positive results to any firm.

According to Deputy Minister of Planning and Investment Tran Duy Dong, after the PM adopted the national digital transformation programme, many sectors have reaped significant outcomes, benefiting people and the entire economy.

Digital transformation is vital as it helps enterprises improve their business governance and adapt to the latest changes in technology, market and consumer taste, he said./.

Exports from six ASEAN countries drop only 2.2 pct despite pandemic: JETRO

Exports from six Southeast Asian countries fell 2.2 percent in 2020 from a year earlier to a combined 1.35 trillion USD, a relatively marginal decline despite COVID-19, according to data from the Japan External Trade Organisation (JETRO).

Of the six, only Vietnam posted an increase in exports for the year, up 7 percent to 282.66 billion USD, with a 5.2 percent drop to Japan more than offset by a 25.7 percent rise to the US and an 18 percent expansion to China.

Meanwhile, the Philippines logged a 10.1 percent fall in exports last year, followed by a contraction of 6 percent in Thailand, 4.1 percent in Singapore and 2.6 percent each in Malaysia and Indonesia.

The combined trade surplus of the six ASEAN members more than triple to 133.66 billion USD, as easing energy prices and shrinking domestic demand led to steeper declines in imports than exports.

Thailand’s trade surplus surged 144.5 percent, compared with an increase of 83.5 percent for Vietnam, 43.9 percent for Singapore and 25.6 percent for Malaysia.

The Philippines narrowed its trade deficit by 46.3 percent to 21.84 billion USD. Indonesia chalked up a trade surplus of 21.74 billion USD, a turnaround from a deficit of 3.6 billion USD in 2019.

Singapore accounted for 27.4 percent of the six countries’ total trade by value in 2020, followed by Vietnam at 21.3 percent, Thailand at 17.1 percent, Malaysia at 16.5 percent, Indonesia at 11.9 percent and the Philippines at 5.8 percent./.

Central Da Nang city to build duty-free zone

Da Nang’s authorities are building a detailed plan for the city’s first international duty-free zone and smart urban area for investors, with construction set to commence soon as the Import-Export Pan Pacific Group (IPPG) has asked the city to allocate land for the project.

Director of the city’s Investment Promotion Agency Huynh Thi Lien Phuong told Vietnam News that the project had been finalising the city’s first international standard downtown duty-free zone and factory outlet centre.

Lien said the city would offer the best conditions for the investor to start the project.

She said the city also planned a downtown free-duty shop at the coastal crown plaza in Ngu Hanh Son District to seek investment.

In 2019, IPPG proposed the project with an investment of 434 million USD, but an appropriate land area was yet to be offered.

In 2018, chairman of the group, Jonathan Hanh Nguyen, urged the city to build a third terminal to ease congestion and design an international standard duty-free zone and recreational area to funnel tourism towards Hoi An, Hue and Da Nang.

He said Da Nang would be a new location for a luxury shopping centre for future development and investment attraction.

Da Nang has been designing the 1,100ha Hi-Tech Park as Vietnam’s ‘Silicon Valley’ to earn revenue of 1.5 billion USD each year with 25,000 jobs and a satellite city of 100,000 people after 2023.

The US-based aviation firm Universal Alloy Corporation (UAC) put the Sunshine Aerospace Components Factory into operation in the first phase in 2020.

The Republic of Korea’s LG Electronics also debuted its research and development (R&D) centre – the second in Vietnam – at the Da Nang Information Technology Park Tower

CMC Corporation, the second-largest information and communications technology (ICT) group in Vietnam, plans to build the Da Nang-based CMC creative space – a digital hub in the Asia-Pacific region – with an estimated investment of 522 million USD.

To date, Da Nang has 876 foreign direct investment projects worth a total of 3.52 billion USD./.

More trade remedy probes predicted for Vietnamese enterprises this year

The Ministry of Industry and Trade (MoIT) is set to bolster action while Vietnamese enterprises have been recommended to gear up preparations as more trade remedy investigations are expected in 2021.

Vietnam’s participation in 14 free trade agreements (FTAs) has helped fuel its trading activities.

MoIT data shows that export turnover boomed from 15 billion USD in 2001 to nearly 100 billion USD in 2011 and then 281.5 billion USD in 2020. The figure is expected to rise 4-5 percent this year.

Sharing the same upward trend in exports, however, is the number of trade remedy cases instigated against Vietnamese goods.

Vietnamese exports, including major foreign currency earners like shrimp, tra fish, steel, and wooden products, have been subject to nearly 200 trade remedy cases so far.

The country has successfully dealt with about 43 percent of cases, thus ensuring the continued export of basa fish and shrimp to major markets like the US and the EU at zero percent or very low tariffs.

It has also launched 19 trade remedy probes itself into imported goods, including steel, chemicals, plastics, fertiliser, monosodium glutamate (MSG), and sugar.

Chu Thang Trung, Deputy Director of the MoIT’s Trade Remedies Authority of Vietnam (TRAV), said trade remedies are appropriate policy tools that the WTO recognises and permits its members to use in international trade.

WTO figures show that more than 4,500 trade remedies have been applied by members since the organisation was established in 1995. Such measures are clearly not an abnormal phenomenon, Trung said.

Vietnam’s membership of many FTAs has sped up the removal of tariff barriers on its exports, giving its goods a greater degree of competitiveness in import markets. It has also put more pressure on producers in importing countries, forcing them to use legal trade policy tools to protect their interests, including trade remedies, the official added.

TRAV Director Le Trieu Dung said trade remedies are increasingly common and are legal measures permitted by the WTO to ensure fair competition between domestically-made goods and imported equivalents.

He pointed out that due to some countries’ trade protection policies and lingering difficulties in the global economy in 2021, the number of trade remedy investigations targeting both Vietnamese exports and imports into the country is predicted to remain high for the foreseeable future.

This will expose domestic manufacturers to new challenges, especially as key FTAs like the EU-Vietnam FTA (EVFTA), the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), and the Regional Comprehensive Economic Partnership (RCEP) will present fierce competition.

Therefore, he added, TRAV has recommended businesses equip themselves with knowledge on trade remedy regulations, particularly those of Vietnam and its export markets, while gearing up resources to cope with any trade remedies.

Pointing out certain shortcomings, experts have said the capacity of local businesses in regard to trade remedies remains modest, while there are ongoing problems in legal regulations and coordination among related agencies.

MoIT has developed a plan on improving the capacity of Vietnamese enterprises to handle trade defence measures now the country is party to many new-generation FTAs.

Experts also held, however, that enterprises themselves need to change their thinking and turn competitive pressure into momentum for reform, development, and product improvement.

Nguyen Thao Hien, Deputy Director of the MoIT’s European – American Market Department, said that to help reduce trade remedy cases, businesses should promote the manufacturing of goods for which domestic material supplies are at hand, as well as those with high added value and rich growth potential amid the pandemic, such as agricultural products, food, and medical equipment.

They must ensure strict quality control and update processing technology so as to raise the value of their products, she added.

Trade remedy investigations can be initiated by one or just a few foreign companies but they pose risks for entire sectors, analysts said, suggesting that Vietnamese firms stay updated with information and actively work with their business associations and State agencies on an effective response.

TRAV Director Dung said that this year, apart from plans on enhancing trade remedy-related capacity and coordination, the authority will also implement plans on building and operating an early warning system for trade remedies and overhaul rules of origin./.

Tens of wind power projects to be operational in Quang Tri

As many as 22 wind power projects with a combined capacity of 907 MW are set to be put into operation in the central province of Quang Tri by year end.

To meet the deadline, the locality has urged project investors to speed up the construction, while pushing ahead with the maintenance of National Highway 9 and other routes to facilitate project equipment transportation.

The local Department of Industry and Trade has also suggested the provincial People’s Committee instruct relevant agencies and units to swiftly remove bottlenecks to site clearance.

As of January, the Ministry of Industry and Trade had approved 31 wind power projects in Quang Tri to date, with an accumulative capacity of 1,177 MW, of which seven are under construction.

Earlier, Huong Linh 1 and 2 wind power projects in the province came into service, significantly contributing to local budget collection.

Apart from projects that had received the green light of the ministry, Quang Tri has tens of others that are under study with a total capacity exceeding 3,600 MW.

The locality has adopted various solutions to support businesses operating in energy in general and wind power in particular such as providing them with consultations in tax, insurance, contract, land and environment, and building the e-government.

Estimations by the ministry showed Vietnam would face a shortage of 6.6 billion kWh in 2021, 11.8 billion kWh in 2022 and 13 billion kWh in 2023. It would require a total investment of 130 billion USD in new power projects by 2030 to make up for the shortages, equivalent to 12 billion USD annually.

The country’s power demand was forecast to increase by 8.5 percent per year over the next five years and seven percent between 2026 and 2030.

Research showed Vietnam had the potential to develop around 8,000MW hydroelectricity from small plants, 20,000MW of wind power and 3,000MW of biomass power and 35,000MW of solar power by 2030./.

UKVFTA hoped to promote Vietnam’s exports

The UK-Vietnam Free Trade Agreement (UKVFTA), which became effective on January 1, is expected to create a strong motivation pushing Vietnam forwards on the path of economic development and international integration.

According to Kenneth Atkinson, head of the British Business Group in Vietnam (Britcham), the deal will help strengthen trade and support employment, while promoting growth in both countries.

The erasing of 65 percent of the total tariff immediately after the deal takes effects and 99 percent of the tariff in 6-7 years will bring about practical benefits to British exporters of machineries, chemicals, and brandy, he held.

Along with the reduction of legal barriers as well as burden in administrative procedures in the two markets, the official said, highlighting that the UKVFTA will help observe the regulations and commitments that the two Governments and business communities have agreed on.

The deal will also ensure the increase in the trade by more than 3,000 UK businesses engaged in export activities to Vietnam, while meeting the demand for Vietnamese goods of UK customers, he said.

Atkinson asserted that the area of solar and wind power will receive priorities from the business communities and governments of both sides.

Experts held that Vietnamese products account for only 1 percent of the 700 billion USD import revenue of the UK, so Vietnam has high potential to provide more products to the promising market, including telephones, accessories, garment and textile products, footwear, seafood, wood and furniture, computers, cashew, and peppercorn.

The UK is currently the third largest trade partner of Vietnam in Europe.

Hoang Quang Phong, Vice President of the Vietnam Chamber of Commerce and Industry (VCCI), said that the UKVFTA not only facilitates the trade of goods and services but also helps promote partnership in many other areas, including green growth and sustainable development.

As the UK has officially left the EU, which means the preferential policies that Vietnam enjoys thanks to the EU-Vietnam Free Trade Agreement (EVFTA) will not be applied in the UK anymore, the UKVFTA has eased concern of the business community about the interruption of trade with the European country, he added./.

Vietnam targets modernity-oriented agriculture: Minister

Vietnam will continue with the building of a modernity-oriented agriculture sector with complete value chains in 2021, according to Minister of Agriculture and Rural Development Nguyen Xuan Cuong.

Cuong told the Vietnam News Agency (VNA)’s reporter that such production chains will be developed on the basis of three groups of major products – the club with export revenue of at least 1 billion USD, agricultural products that are of localities’ strength like longan in northern Hung Yen province and lychee in northern Bac Giang province, and “One Commune, One Product” (OCOP) goods.

Vietnam has paid attention to product quality during its international economic integration, Cuong said, stressing the significance of organic agriculture.

The sector will also take various solutions to call for the involvement of businesses, while promoting the linkages between them and farmers and cooperatives.

To attract more enterprises, the sector will further provide consultations for the Prime Minister in order to complete mechanisms and policies, as well as administrative reforms, he said.

The Ministry of Agriculture and Rural Development (MARD) will also closely coordinate with localities to facilitate investment, the minister said, adding that greater efforts will be made to step up the formation of new-style cooperatives.

Cuong said the application of digital technology should be intensified in spheres, and the MARD will join hands with the Ministry of Science and Technology and the Ministry of Information and Communications in this regard.

In another interview with the Dien dan Doanh nghiep (Business Forum) newspaper, Cuong said that 2020 was a year full of challenges and difficulties for Vietnam’s economy, including the agriculture sector, due to the COVID-19 crisis. The sector also had to face natural disasters, including unprecedented drought.

The growth and trade targets for the sector last year were also the highest ever, with exports set at over 41 billion USD.

However, Cuong noted, thanks to the efforts of the entire political system, ministries, sectors, localities, and economic elements, the agricultural sector managed to secure growth of about 2.65 percent and post export earnings of 41.25 billion USD, with nine groups of commodities enjoying shipments of over 10 billion USD.

The agriculture sector’s export target of 44 billion USD this year, set by Prime Minister Nguyen Xuan Phuc, is a high but feasible goal. Vietnam earned about 3.49 billion USD from exports of agricultural, forestry, and fisheries products in January, up 27.1 percent year-on-year, data from the Ministry of Agriculture and Rural Development shows.

Under a plan recently approved by the PM, Vietnam expects the annual figure to reach some 60-62 billion USD by 2030./.

Thanh Hoa looks to develop tourism into spearhead economic sector

The north-central province of Thanh Hoa has set a target of turning tourism into a spearhead economic sector by 2030.

Amid the difficulties posed by COVID-19, the province welcomed 7.3 million visitors in 2020, earning 10.394 trillion VND (over 453.6 million USD), representing 65.5 percent and 50.7 percent of targets, respectively.

Thanh Hoa’s tourism sector has posted impressive growth in recent years.

But Vice Chairman of the provincial People’s Committee Nguyen Van Thi said that its development is still not commensurate with potential.

Thanh Hoa lacks high-quality products to attract and meet the demand of international tourists, while its promotional activities remain ineffective and tourism human resources fail to meet requirements in the context of integration, he said.

According to Deputy General Director of the Vietnam National Administration of Tourism (VNAT) Nguyen Thi Thanh Huong, Thanh Hoa needs to introduce changes to take its tourism industry forward.

It should propose that the Government allow it offer incentives for tourism investment, she said.

Attention should be paid to accelerating the implementation of priority strategies for tourism development and administrative reform, and supporting businesses towards attracting strategic investors in developing infrastructure facilities serving tourism development, especially transport infrastructure.

Thanh Hoa should also focus on enhancing its cooperation with other localities to create new tours, develop high-quality and competitive products, and promote digital transformation and the application of information technologies in tourism activities./.

Kien Giang eyes 60-100 million USD in FDI over next five years

The Mekong Delta province of Kien Giang has set its sights on pulling in 60-100 million USD worth of FDI over the next five years, according to Vice Chairman of the provincial People’s Committee Nguyen Duc Chin.

It will focus its efforts on fulfilling plans on medium-term public investment and socio-economic development in 2021-2025, striving to attract 40 to 50 FDI projects with registered investment of 60-100 million USD in total, Chin said.

It aims for local social investment to reach 48 trillion VND (2.07 billion USD) this year.

The province has been accelerating communications campaigns on its strengths, potential, and investment incentives to attract both domestic and foreign investors.

Priority is being given to numerous areas, including road infrastructure; river ports; sea ports; electricity; water supply; solid waste treatment; renewable energy; infrastructure development in industrial parks and clusters; fishing, aquaculture and fish processing; intensive farming and industrial agriculture; supporting industries; tourism; services; education; and high-quality healthcare.

It also wants to attract large-scale projects with advanced technologies in high-tech agriculture and food processing.

Cooperation with ministries and government agencies will be stepped up to take part in investment promotion events in major partners such as the Republic of Korea, Japan, Singapore, and the US, as well as those who are members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the EU-Vietnam Free Trade Agreement (EVFTA).

The province will also increase dialogue with local businesses and investors to help them tackle any difficulties and create an open and fair business climate.

Kien Giang is calling for investment in 144 projects in priority fields. It has to date granted in-principle approval and investment licenses to 49 projects with total investment of 22.66 trillion VND.

The Mekong Delta province welcomed 206 projects during the 2016-20 period, including 22 foreign projects with nearly 133 trillion VND in total capital./.

Outlook positive for Vietnam’s retail market

Despite a raft of difficulties facing Vietnam’s retail market, economists and insiders are still optimistic about the outlook for the sector in the time ahead, according to the Vietnam Report JSC.

In a recent survey, Vietnam Report found that nearly 42 percent of Vietnamese retail companies have been seriously impacted by COVID-19, while half said the impact has not been too serious and 8 percent experienced only minor effects.

Many people have had to cut their spending after becoming jobless or having their wages reduced due to the pandemic. Retail companies, meanwhile, have had to face a shortage of capital and disrupted supply chains.

However, Vu Dang Vinh, General Director of Vietnam Report, said economists and insiders remain optimistic about the sector’s outlook.

In following COVID-19 prevention and control regulations, many consumers have opted for online shopping, convenience stores, shopping centres, and supermarkets, rather than traditional markets.

Vinh pointed to the increased popularity of multi-channel marketing, both online and in-person, while adding that thanks to quick changes, many retail businesses, including giants like Lotte Mart, have posted online sales growth of 100 to 200 percent, especially in Hanoi and HCM City.

Mergers and acquisitions (M&As) are also expected to boom in Vietnam’s retail market in the time ahead, he said, explaining that more than 60 percent of local retailers are of small and medium-size and have significant demand for capital, so are ready to enter into partnerships.

Analysts also said the mini-supermarket model has proven superior amid the pandemic, as it can limit large gatherings.

Retailers have therefore poured more investment into this model while introducing more changes to better meet customer demand./.

Tra Vinh-based business promotes coconut product export

An enterprise based in the Mekong Delta province of Tra Vinh has been stepping up the export of coconut shell activated carbon and other coconut products as a way to benefit the company itself and local farmers.

Between January 1 and February 10, the Tra Bac Joint Stock Corporation (TRABACO) shipped more than 900 tonnes of coconut shell activated carbon to various markets, including the US, the UK, the Republic of Korea, Japan, Peru, Ecuador, Israel, and China.

General Director of the firm Huynh Khac Nhu said his company has inked a number of contracts with both new and existing partners since the year’s beginning, with 2,000 tonnes of coconut shell activated carbon to be delivered between now and June 2021.

TRABACO’s activated carbon, used for air purification, gold refining, electroplating, and odor control in different industries, meets environmental and health safety standards, thus winning over trust from many domestic and foreign businesses and consumers, he noted.

The product has been exported to more than 30 countries and territories in around the world.

Apart from coconut shell activated carbon, the company also produces and exports others made from coconut like coir carpets, dried coconut shreds, and frozen coconut milk.

To improve product quality and ensure stable material supply, it has contracted farmers to develop a 300ha organic coconut farming zone in Tieu Can district and partnered with a local agricultural cooperative in coconut purchase.

Nhu added these are initial steps in the firm’s plan to form a zone of clean material supply, which will help promote TRABACO’s product quality as well as income for farmers in Tra Vinh province./.

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