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Enterprises need to be pro-active during the pandemic

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Nguyen Bich Lam, former director general of the General Statistics of Vietnam, talks on what Vietnamese enterprises need to do to maintain their business production during the COVID-19 pandemic.

Enterprises need to be pro-active during the pandemic
Workers at Tien Hung Garment Joint Stock Company in Hung Yen Province. — VNA/VNS Photo Pham Kien

What are the impacts of the current COVID-19 on the international economy?

The COVID-19 has caused heavy negative impacts on the international economy and Vietnamese enterprises.

The global supply chain has been disrupted and many people have lost their jobs. The pandemic has weakened the purchasing power of people all over the world, particularly in the fields of tourism and services.

More seriously, the pandemic has caused a negative impact on global economic growth as well as international trade and investment.

It has become a hurdle in the economic, trade and investment co-operation among trade partners in the world when their governments and enterprises have decided to temporarily stop their economic activities in areas/regions which have been hit by the COVID-19 pandemic.

For example, the Japanese Government has reserved US$2 billion to support Japanese enterprises which are operating in China to return to Japan. It has also been suggested that US enterprises will leave China to create more jobs for the Americans.

It is projected that in a near future the world economic growth rate and trade will seriously be impacted.

What will be the impact on Vietnam?

Before the breakout, Vietnamese enterprises were exposed to certain weaknesses. The country has many enterprises, but most of them are small and medium enterprises and the structure between different economic entities is quite irrational.

It is reported that only 44.1 per cent of the enterprises are operating successfully while up to 48.4 per cent of enterprises are operating at a loss. Meanwhile, the pre-tax profit from the business sector saw an increase of just 2.1 per cent.

By mid-September 2020, it was reported that up to 83.7 per cent of enterprises were negatively impacted by COVID-19.

However, it is reported in the context of COVID-19, enterprises operating in the fields of insurance, health care, post office gained certain benefits from the pandemics.

Do you have any suggestions or measures to help to enterprises recover when the pandemic is successfully controlled?

For the time being, we have to use the State budget to supply or to give preferential loans to enterprises for them to continue their operations. We should simplify the administrative procedures to enable the enterprises to apply for loans from the State budget or from credit funds.

In the meantime, the Government should also give more support to domestic investment while attracting more direct foreign investment – of course with proper screening.

I hope, the Party, the National Assembly and the Government will soon come up with good and workable strategies to develop the country’s socio economy in the context of the changing of the world economy and the international politics.  VNS

Source: https://vietnamnet.vn/en/business/enterprises-need-to-be-pro-active-during-the-pandemic-687981.html

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Unprecedented: Chinese car imports selling well in Vietnam

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Chinese car brands made a breakthrough in 2020 when their cars began selling well in Vietnam, which had never before favored products from China.

Unprecedented: Chinese car imports selling well in Vietnam

Car dealers revealed that the two Chinese models Beijing X7 and Brilliance V7 are in short supply. There has been no Chinese arrival since the beginning of 2021, so car buyers have had to wait for deliveries.

Beijing X7 has been the best Chinese seller, while Brilliance V7 has ranked second. Though the design and equipment of Brilliance V7 is inferior to Beijing X7, it has a large interior compartment and uses a BMW engine.

One source said that a total of 500 Beijing X7s were imported to Vietnam as of the end of 2020. Imports of other models, including Brilliance V7, Zotye Z8 and BJ 40, had reached 300.

Despite Covid-19, which had an adverse impact on Vietnam’s automobile market, Chinese brands in 2019 had sales increases, especially in the last months of the year.

Car dealers hope their business will be even better in 2021, considering the orders they have taken. Their biggest worry now is the supply shortage and price increases.

“Chinese suppliers now cannot satisfy our orders for Beijing X7 and Brilliance V7. Meanwhile, as the reminbi/US dollar exchange rate has fluctuated, every imported car is $1,000 more expensive. The transport cost of every car has also surged to $1,800, six times higher than previously,” said a car dealer specializing in Chinese imports.

However, some analysts still doubt that Chinese cars will continue to sell well in 2021. They said Chinese cars sell well at launch, but see sales decrease later.

They said some buyers said that they had bought Chinese cars just to have some experience and still need some more time to evaluate their quality. In general, Chinese brands are not considered strong brands.

The common characteristics of Chinese next-generation models are that they have beautiful designs like European cars and are equipped with many high technologies, while the prices are very affordable.

However, in addition to these characteristics, Vietnamese want strong brands and high quality. The preconception that Chinese products mean low-quality products still exists.

With VND700 million, Vietnamese now have many choices for non-Chinese cars. They can buy Japanese and South Korean products, which don’t have too many high tech features but are relatively modern and have good design. And importantly, there us no need to worry about the quality of the products.

Most imported Chinese models have selling prices of around VND700 million. With an engine of less than 2.0L, the import tariff is 70 percent, luxury tax 35-40 percent and VAT 10 percent. The production cost is estimated at VND300 million. 

Tran Thuy

Source: https://vietnamnet.vn/en/business/unprecedented-chinese-car-imports-selling-well-in-vietnam-706772.html

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G-Group launches e-wallet

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 HÀ NỘI — E-wallet firm Gpay, a member company of G-Group Technology Corporation, announced it had completed its Series A investment with the participation of KB Fina, a joint venture between G-Group and South Korean KB Financial Group, in Ha Noi yesterday.

KB Financial Group invested VNĐ425 billion (US$18.4 million) in Gpay through KB Securities, its representative in Viet Nam.

Within the event, the Gpay e-wallet was officially launched.

Nguyễn Thuần Chất, co-founder and CEO of Gpay, said: “The investment will be used to grow users based on the existing ecosystem, develop strategic technology solutions and people investment with the mission to bring convenience, security and happiness for Vietnamese people by providing platforms in financial services on mobile devices.”

With a supportive ecosystem from G-Group with nearly 30 million users across financial services, financial technology and social networking platforms, Chất said: “We aim to provide a comprehensive range of payment and financial services to 5 million users by 2023.”

He said the additional resources and in-depth experience in the financial sector from KB Financial Group would bring a lot of opportunities for Vietnamese people to use fintech services and contribute to developing digital platforms for the financial industry and boosting local cashless payments.

Mentioning KB Fina, which KB Financial Group invested VNĐ300 billion in, Peter Chunsoo Park, chairman of KB Securities Vietnam said: “KB Fina is a comprehensive financial digital platform to serve Vietnamese consumers who are unbanked or under-serviced.”

As one of the leading technology corporations in Việt Nam, G-Group is growing an ecosystem of nearly 30 million users across financial services, financial technology, intermediary payment, e-wallet, social network, online games, digital media platforms, cybersecurity and high-tech R&D. —

Source: https://vietnamnews.vn/economy/858883/g-group-launches-e-wallet.html

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Construction of expy linking Dong Nai and Dalat under consideration

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A section of the National Highway 20, currently the only road connecting Dong Nai and Dalat City. The Ministry of Transport is drawing up a prefeasibility study report for the Dau Giay-Lien Khuong expressway project connecting Dong Nai Province with Lam Dong Province – PHOTO: LE ANH

HCMC – The Ministry of Transport is drawing up a prefeasibility study report for the Dau Giay-Lien Khuong expressway project connecting Dong Nai Province with Lam Dong Province in the 2021-2025 period.

The ministry said in Document 72 responding to the Dong Nai voters’ proposal on the investment in the expressway that the Dau Giay-Lien Khuong expressway would comprise the Dau Giay-Tan Phu, Tan Phu-Bao Loc and Bao Loc-Lien Khuong sections.

In 2019, the ministry assigned the Thang Long Project Management Board to conduct prefeasibility studies for the three subprojects to ensure the construction is ready in the five-year period.

The Dau Giay-Tan Phu section had earlier been scheduled to be 60 kilometers long and get off the ground in 2019. However, obstacles over funding hindered the construction of the project.

Recently, Lam Dong Province proposed the prime minister assign the province to implement the Tan Phu-Bao Loc expressway project in the 2021-2025 period under the public private partnership (PPP) format with support from the Government.

The Tan Phu-Bao Loc expressway project will require some VND18.2 trillion in investment, according to calculations by the provincial government.

The province is studying four investment solutions for the project under the PPP format with a capital recovery period of nearly 30 years. If the proposal is approved, work on the project will start this year.

Once in place, the Dau Giay-Lien Khuong expressway will shorten the travel time from HCMC to Dalat City and ease the traffic overload on National Highway 20, the only road linking Dong Nai Province and Dalat City.

Source: https://english.thesaigontimes.vn/80241/construction-of-expy-linking-dong-nai-and-dalat-under-consideration-.html

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